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This Preliminary Official Statement and the information contained herein are subject to completion or amendment. These securities may not be sold, nor may offers to buy them be accepted, prior to the time the Official Statement is delivered in final form. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

PRELIMINARY OFFICIAL STATEMENT DATED SEPTEMBER 7, 2017 NEW ISSUE (Book-Entry Only)

NO RATING

In the opinion of Sherman & Howard L.L.C., Las Vegas, Nevada, Bond Counsel, assuming continuous compliance with certain covenants described herein, interest on the Bonds is excluded from gross income under federal income tax laws pursuant to Section 103 of the Internal Revenue Code of 1986, as amended to the date of delivery of the Bonds (the “Tax Code”), and interest on the Bonds is excluded from alternative minimum taxable income as defined in Section 55(b)(2) of the Tax Code except that such interest is required to be included in calculating the “adjusted current earnings” adjustment applicable to corporations for purposes of computing the alternative minimum taxable income of corporations. See “TAX MATTERS—Federal Tax Matters.”

$11,605,000* CITY OF LAS VEGAS, NEVADA Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017 Dated: Date of Delivery

Due: June 1, as shown on the inside front cover

The Bonds described herein are being issued by the City of Las Vegas, Nevada (the “City”) to: (i) finance the acquisition of certain public improvements specially benefitting property located within the City’s Special Improvement District No. 609 (Skye Canyon) (the “District”); (ii) fund a reserve fund securing the Bonds; (iii) fund capitalized interest on the Bonds through December 1, 2017 and (iv) pay the costs of issuing the Bonds. The Bonds are being issued pursuant to Nevada Revised Statutes Chapter 271 and a Trust Indenture, dated as of September 1, 2017 (the “Indenture”), by and between the City and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”). The Bonds are issuable in fully registered form and, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York. Individual purchases of Bonds may be made in principal amounts of $5,000 and integral multiples thereof. The Bonds will be in book‑entry form only, and purchasers thereof will not receive certificates representing their beneficial ownership but will receive credit balances on the books of their respective nominees. The Bonds will not be transferable or exchangeable except for transfer to another nominee of The Depository Trust Company or as otherwise described herein. Interest on the Bonds is payable semiannually on each June 1 and December 1, commencing on December 1, 2017. Such interest, and the principal of, and any premium on, the Bonds are payable by the Trustee to Cede & Co., and such payments are expected to be disbursed to the beneficial owners of the Bonds through their nominees. The Bonds are subject to redemption prior to maturity as described herein. The Bonds will be secured by the Trust Estate, which generally consists of: (i) special assessments levied by the City on all of the assessable property within the boundaries of the District and (ii) all moneys and securities from time to time held by the Trustee in the Bond Fund, the Redemption Fund and the Reserve Fund established pursuant to the Indenture. The Bonds do not constitute a debt of the City, and the City shall not be liable thereon except from the Trust Estate. The full faith and credit of the City is not pledged to the payment of the Bonds, and the payment of the Bonds is not secured by any encumbrance, mortgage or other pledge of property of the City except the pledge of the Trust Estate. THE BONDS ARE NOT RATED BY ANY RATING AGENCY, AND INVESTMENT IN THE BONDS INVOLVES RISKS WHICH MAY NOT BE APPROPRIATE FOR CERTAIN INVESTORS. THEREFORE, ONLY PERSONS WITH SUBSTANTIAL FINANCIAL RESOURCES WHO UNDERSTAND THE RISKS OF INVESTMENT IN THE BONDS SHOULD CONSIDER SUCH AN INVESTMENT. SEE THE SECTION OF THIS OFFICIAL STATEMENT ENTITLED “CERTAIN RISK FACTORS” FOR A DISCUSSION OF CERTAIN FACTORS WHICH SHOULD BE CONSIDERED, IN ADDITION TO THE OTHER MATTERS SET FORTH HEREIN, IN EVALUATING THE INVESTMENT QUALITY OF THE BONDS. This cover page contains certain information for quick reference only. It is not a summary of the Bonds offered pursuant hereto. Investors must read the entire Official Statement in order to obtain information essential to the making of an informed investment decision. MATURITY SCHEDULE (See inside front cover page) The Bonds are offered when, as and if issued and received by the Underwriter, subject to the approval of Sherman & Howard L.L.C., Las Vegas, Nevada, Bond Counsel, and to certain other conditions. Certain legal matters will be passed upon for the Underwriter by Stradling Yocca Carlson & Rauth, a Professional Corporation, Reno, Nevada and for the City by the City Attorney. It is anticipated that the Bonds will be available for delivery in book-entry form through the facilities of DTC on or about September 27, 2017.

Dated: September __, 2017 * Preliminary, subject to change.

MATURITY SCHEDULE $__________ Serial Bonds Maturity (June 1)* 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047

Principal Amount* $140,000 210,000 220,000 225,000 235,000 240,000 250,000 260,000 270,000 280,000 290,000 300,000 315,000 330,000 345,000 360,000 375,000 395,000 415,000 435,000 455,000 480,000 500,000 525,000 550,000 580,000 610,000 640,000 670,000 705,000

Interest Rate

Yield

Price

CUSIP No.†

$________ ____% Term Bonds due June 1, 20__, Yield: _____% Price: ______ CUSIP No.† _______

* 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 S&P Capital IQ. Copyright© 2017 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. Neither the City nor the Underwriter takes any responsibility for the accuracy of such numbers.

CITY OF LAS VEGAS, NEVADA CITY COUNCIL Carolyn G. Goodman, Mayor Lois Tarkanian, Mayor Pro Tem Ricki Y. Barlow, Councilman Stavros S. Anthony, Councilman Bob Coffin, Councilman Steven G. Seroka, Councilman Michele Fiore, Councilwoman

CITY OFFICIALS Scott Adams, City Manager Gary Ameling, Chief Financial Officer Venetta Appleyard, Finance Director Bradford R. Jerbic, City Attorney

BOND COUNSEL Sherman & Howard L.L.C. Las Vegas, Nevada TRUSTEE The Bank of New York Mellon Trust Company, N.A. Los Angeles, California FINANCIAL ADVISOR Zions Public Finance Las Vegas, Nevada APPRAISER Continental Realty Advisors – VSG Irvine, California MARKET ABSORPTION CONSULTANT RCG Economics LLC Las Vegas, Nevada

Investment in the Bonds involves risks which may not be appropriate for certain investors. Therefore, only persons with substantial financial resources (in net worth and/or income) who understand (either alone or with competent investment advice) the risk of investment in the Bonds should consider such an investment. All information for investors regarding the City of Las Vegas, Nevada, its Special Improvement District No. 609 (Skye Canyon) and the Bonds is contained in this Official Statement. While the City maintains an internet website for various other purposes, none of the information available on this website is intended to assist investors in making any investment decision or to provide any continuing information with respect to the Bonds or any other bonds or obligations of the City. No dealer, broker, salesperson or other person has been authorized by the City to provide any information or to make any representations other than as contained herein and, if given or made, such other information or representation must not be relied upon as having been authorized by the City. 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 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 Bonds. Statements contained in this Official Statement that involve estimates, forecasts or matters of opinion, whether or not expressly so described herein, are intended solely as such and are not to be construed as a representation of facts. The information and expressions of opinion herein are subject to change without notice; and neither delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the City or its Special Improvement District No. 609 (Skye Canyon) or any matters discussed herein since the date hereof. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.

CAUTIONARY INFORMATION REGARDING FORWARD-LOOKING STATEMENTS IN THIS OFFICIAL STATEMENT Certain statements included or incorporated by reference in this Official Statement constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as “plan,” “expect,” “estimate,” budget” or other similar words. The achievement of certain results or other expectations contained in such 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 the results, performance or achievements expressed or implied by such forwardlooking statements. No updates or revisions to those forward-looking statements are expected to be issued if or when the expectations, or events, conditions or circumstances on which such statements are based change.

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE 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 UNDERWRITER MAY OFFER AND SELL BONDS AT PRICES LOWER THAN THE PUBLIC OFFERING PRICES SET FORTH ON THE INSIDE COVER PAGE HEREOF, AND SUCH PUBLIC OFFERING PRICES MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITER. THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, IN RELIANCE UPON AN EXEMPTION CONTAINED IN SUCH ACT. THEY HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE.

TABLE OF CONTENTS Page INTRODUCTION ........................................................................................................................................ 1 THE BONDS ................................................................................................................................................ 2 Authority for Issuance ............................................................................................................................ 2 General Provisions ................................................................................................................................. 2 Book-Entry System ................................................................................................................................ 3 Redemption ............................................................................................................................................ 3 Debt Service Schedule............................................................................................................................ 5 SOURCES AND USES OF FUNDS ............................................................................................................ 6 LIMITATION OF LIABILITY .................................................................................................................... 6 SECURITY FOR THE BONDS ................................................................................................................... 6 Assessments............................................................................................................................................ 6 Property Values ...................................................................................................................................... 9 Market Absorption Study ..................................................................................................................... 10 Collections of Assessments and Delinquencies.................................................................................... 10 Enforcement Proceedings ..................................................................................................................... 11 Prosecution of Foreclosure Actions by Owners and Other Remedies. ................................................. 12 Reserve Fund ........................................................................................................................................ 12 No Additional Bonds Except for Refunding Purposes ......................................................................... 13 THE DISTRICT .......................................................................................................................................... 14 General ................................................................................................................................................. 15 The Developer and the Contracted Project Manager............................................................................ 20 The Financing Agreement .................................................................................................................... 21 The Development Plan ......................................................................................................................... 21 THE DEVELOPER’S FINANCING PLAN............................................................................................... 24 Infrastructure Improvements and Financing Plan ................................................................................ 24 CERTAIN RISK FACTORS ...................................................................................................................... 27 General ................................................................................................................................................. 27 Concentration of Ownership................................................................................................................. 27 Development Uncertainties - General .................................................................................................. 27 Development Uncertainties - Financing ............................................................................................... 28 Availability of Water Service ............................................................................................................... 29 Availability of Sewer Service ............................................................................................................... 29 Desert Tortoise and Other Animal and Plant Resources ...................................................................... 30 Cultural Resources ............................................................................................................................... 30 Environmental ...................................................................................................................................... 30 Flood Plains and Washes ...................................................................................................................... 30 Enforcement Delays - Bankruptcy ....................................................................................................... 31 Governmental Ownership Interests in the Property ............................................................................. 31 Amendments to Indenture .................................................................................................................... 33 Loss of Tax Exemption ........................................................................................................................ 33 TAX MATTERS ......................................................................................................................................... 33 -i-

TABLE OF CONTENTS (continued) Page Federal Tax Matters.............................................................................................................................. 33 State Tax Matters.................................................................................................................................. 35 ABSENCE OF LITIGATION .................................................................................................................... 35 NO RATINGS ............................................................................................................................................ 35 CONTINUING DISCLOSURE .................................................................................................................. 35 UNDERWRITING ..................................................................................................................................... 36 ADDITIONAL INFORMATION ............................................................................................................... 36 MISCELLANEOUS ................................................................................................................................... 36 APPENDIX A - CERTAIN DEFINITIONS AND SUMMARY OF LEGAL DOCUMENTS .............. A-1 APPENDIX B - PROPOSED FORM OF OPINION OF BOND COUNSEL ......................................... B-1 APPENDIX C - INFORMATION CONCERNING THE DEPOSITORY TRUST COMPANY........... C-1 APPENDIX D - FORM OF CITY CONTINUING DISCLOSURE CERTIFICATE ............................. D-1 APPENDIX E - FORM OF DEVELOPER CONTINUING DISCLOSURE UNDERTAKING ........... E-1 APPENDIX F - THE APPRAISAL .........................................................................................................F-1 APPENDIX G - MARKET ABSORPTION STUDY.............................................................................. G-1

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SUMMARY STATEMENT THIS SUMMARY STATEMENT IS SUBJECT IN ALL RESPECTS TO THE MORE COMPLETE INFORMATION AND THE DEFINITIONS FOUND IN THE ENTIRE OFFICIAL STATEMENT, AND THE OFFERING OF THE BONDS TO POTENTIAL INVESTORS IS MADE ONLY BY MEANS OF THE ENTIRE OFFICIAL STATEMENT. Purpose:

The bonds described herein (the “Bonds”) are being issued by the City of Las Vegas, Nevada (the “City”) pursuant to the Nevada Consolidated Local Improvements Law, as amended (Nevada Revised Statutes (“NRS”) Chapter 271) and the Trust Indenture, dated as of September 1, 2017 (the “Indenture”), by and between the City and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), primarily to finance the acquisition of certain public improvements specially benefitting property located within the City’s Special Improvement District No. 609 (Skye Canyon) (the “District”). The District is within the master planned community known as Skye Canyon, which is located in the northwest section of the Las Vegas Valley. The District includes approximately 649 gross acres located within the corporate boundaries of the City. Included within the boundaries of the District is Assessor’s Parcel No. 126-12101-002 which consists of approximately 444 acres. Portions of such parcel are expected to be included in parcels 2.17 and 2.20 upon recordation of the parent map for such parcels (as described herein). Upon recordation of such parent maps, only the portion of Assessor’s Parcel No. 126-12-101-002 that is included within parcels 2.17 and 2.20 is expected to be assessed. The resulting net assessable acreage within the District following the recordation of such parent maps is expected to be approximately 218 acres.

Security for the Bonds:

The Bonds are secured by assessments (the “Assessments”) levied by the City on all of the assessable property within the boundaries of the District. The parcels with Assessments which secure the Bonds are collectively referred to herein as the “Property.” The Assessments represent liens on the respective parcels of the Property subject thereto; they do not, however, constitute a personal indebtedness of the respective owners of such parcels. Accordingly, in the event of a delinquency in the payment of an Assessment, proceedings may be conducted only against the property securing the delinquent Assessment. Installments of the Assessments and interest thereon (the “Assessment Installments”) in an aggregate amount equal to at least one-half of the annual debt service on the Bonds are to be billed semiannually by the City for the payment of the principal of and interest on the Bonds and certain administrative expenses of the City. The Assessments and moneys and securities from time to time held by the Trustee in the Bond Fund, the Redemption Fund and the Reserve Fund established pursuant to the Indenture (collectively, the “Trust Estate”) are, pursuant to the Indenture, pledged to the payment of the principal of, premium, if any, and interest on the Bonds. The monies and securities from time to time held by the Trustee in the Construction Fund, the Administration Fund, and the Rebate Fund do not constitute a part of the Trust Estate. A reserve fund (the “Reserve Fund”) has been established pursuant to the Indenture and will be initially funded from proceeds from the sale of the Bonds in the amount of $________, equal to the least of: (a) ten percent (10%) of the initial i

proceeds of the Bonds; (b) Maximum Annual Debt Service (as defined in the Indenture); or (c) one hundred twenty-five percent (125%) of Average Annual Debt Service (as defined in the Indenture) (the “Reserve Requirement”). The Reserve Requirement shall be recalculated upon (i) any redemption of Bonds from prepaid Assessments (such adjustments shall be downward but never upward); or (ii) the issuance of any Refunding Bonds (as defined in the Indenture). For the purposes of clause (a) of the definition of Reserve Requirement, the term “proceeds” means the aggregate stated principal amount of the Bonds, unless there is more than a de minimis amount (as defined in Section 1.148-1(b) of the Code (as defined in the Indenture)) of original issue discount or premium, in which case “proceeds” means issue price (determined without regard to pre-issuance accrued interest). The money on deposit in the Reserve Fund will be a source of funds with which to pay principal of and interest on the Bonds in the event of delinquencies in the payment of Assessment Installments. The Bonds do not constitute a debt of the City, and the City will not be liable thereon except from the Trust Estate. The full faith and credit of the City is not pledged to the payment of the Bonds, and the payment of the Bonds is not secured by any encumbrance, mortgage or other pledge of property of the City except the Trust Estate. Form of Bonds:

The Bonds are being issued in fully registered form and will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, which will act as securities depository of the Bonds. Ownership interests in the Bonds may be purchased only in book-entry form in principal amounts of $5,000 or any integral multiple thereof.

Payment of Interest:

Interest on the Bonds is payable semiannually on each June 1 and December 1, commencing December 1, 2017. The interest on the Bonds due on December 1, 2017 will be paid from capitalized interest.

Redemption:

The Bonds are subject to optional redemption, mandatory sinking fund redemption and mandatory redemption from prepaid Assessments as described herein.

The Project:

A portion of the proceeds of the Bonds will be used to acquire and improve a street project, storm sewer project, sanitary sewer project, drainage project, and water project. The Developer expects to complete the backbone infrastructure necessary to complete the planned development within the District by the end of 2018.

The Developer and the Development:

The District consists of approximately 649 gross acres within the approximately 1,700 acre master planned community known as Skye Canyon, located in the northwest section of the Las Vegas Valley. All 649 gross acres within the District will be subject to Assessments on the date of issuance of the Bonds. Of those 649 gross acres, approximately 218 net acres within the District are ultimately expected to be subject to Assessments following certain anticipated reapportionments. The master developer of Skye Canyon and the Property is KAG Development West LLC (the “Developer”). Section 12 LLC owns one parcel totaling approximately 444 acres within the District, portions of which (approximately 28 acres) are expected to be transferred to the Developer and ii

included in two parcels upon finalization of the parent maps for such parcels. Following the recording of such parent maps, the Assessments originally imposed on the land owned by Section 12 LLC are expected to be reapportioned by the City onto the approximately 28 acres then to be owned by the Developer. After such reapportionment, the District is anticipated to include 218 net assessable acres. The Developer and Section 12 LLC either have agreed, or will agree prior to closing, that any land transfers made by such entities will not be coupled with a request to reapportion the Assessments onto the transferred land in a manner that results in the Assessments on such transferred land exceeding $58,000 per acre; however, subsequent reapportionment requests made by homebuilders or other landowners could result in higher Assessments per acre by consent of such landowner. The Developer and Section 12 LLC are affiliates of the Olympia Companies development group. The Developer has contracted with Kyle Agent, LLC and Ninety Five Management, LLC (which is an affiliate of the Olympia group of companies) to manage and develop the property within the Skye Canyon master planned community, which includes the District. In January 2017, construction commenced on a detention basin, arterial roads (Eagle Canyon, Egan Crest and Shaumber roads) as well as two water transmission mains necessary to develop the property within the District. With the exception of an offsite water tank, construction plans for all backbone infrastructure within the District have been approved. The Developer expects that all District on-site infrastructure and improvements and shared cost components will be completed by the end of 2018. The Developer expects to develop the property within the District that is planned for residential development to the point at which it can convey such land to merchant builders. As of September 1, 2017, the Developer had conveyed one parcel to Pardee Homes and two parcels to Pulte Homes (or their homebuilding subsidiaries and divisions) which are expected to include a total of 256 single family homes. In addition, the Developer has entered into contracts to sell four parcels to Lennar Homes, Richmond American Homes and Woodside Homes (or their homebuilding subsidiaries and divisions), which are expected to include a total of 428 single family homes. Sales to such merchant builders are expected to close in September 2017. The Developer expects sales of the remaining five parcels within the District planned for residential development (which are expected to include 493 single family homes) to occur in 2018. The property conveyed or to be conveyed to such merchant builders is expected to total approximately 1,177 single family homes. The Developer has also entered into a contract to sell a 5.48 net assessable acre parcel to Somerset Academy to build a charter school which sale is expected to close in September 2017. The balance of the property within the District is planned for streets, parks, arroyos, trails, open spaces, a completed community center, and other non-assessable uses. Property Values:

An appraisal of the Property, dated August 17, 2017 (the “Appraisal”), has been prepared by Continental Realty Advisors-VSG (the “Appraiser”). The purpose of the Appraisal is to estimate the market value of the Property assuming, among things, the installation of the improvements to be financed with the proceeds of the Bonds. As indicated in the Appraisal, subject to the limitations set forth therein, iii

as of August 1, 2017 (the “Date of Value”), the total estimated market value of the Property was $41,240,000, resulting in an overall taxable value to assessment lien ratio of approximately 3.55 to 1*. Market Absorption:

In order to determine the projected absorption of the property within the District, the City engaged RCG Economics LLC, Las Vegas, Nevada (the “Market Absorption Consultant”), 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 forthcoming for-sale products within the District. The Market Absorption Consultant concludes that the Las Vegas Valley’s economy has generally recovered from the severe recession in the late 2000s, is growing at a moderate pace and is likely to remain relatively healthy through the projected absorption period of the property within the District. Based on the schedule of lot sales to merchant builders provided by the Developer and an assumed six month period for each merchant builder to commence home sales, the Market Absorption Consultant projects that the last home sales for the 1,177 single family detached products in the District analyzed by the Market Absorption Consultant will occur during the first quarter of 2023.

The City:

The City is an incorporated municipality and a body corporate and politic existing under the laws of the state of Nevada. The City was created by a special act of the Legislature in 1911. It is the county seat of Clark County and is the most populous city in the State.

*

Preliminary, subject to change.

iv

$11,605,000* CITY OF LAS VEGAS, NEVADA Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017 INTRODUCTION The purpose of this Official Statement, which includes the cover page and the appendices hereto, is to provide certain information concerning the City of Las Vegas, Nevada, Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017 (the “Bonds”). The Bonds are being issued by the City of Las Vegas, Nevada (the “City”) pursuant to the Nevada Consolidated Local Improvements Law, as amended (Nevada Revised Statutes (“NRS”) Chapter 271, the “Act”) and a Trust Indenture, dated as of September 1, 2017 (the “Indenture”), by and between the City and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) to: (i) finance the acquisition of certain public improvements (the “Improvement Project”) specially benefitting property located within the City’s Special Improvement District No. 609 (Skye Canyon) (the “District”); (ii) fund a reserve fund securing the Bonds; (iii) fund capitalized interest on the Bonds through December 1, 2017 and (iv) pay the costs of issuing the Bonds. All of the assessable property within the boundaries of the District (collectively, the “Property”) has been assessed to pay the estimated cost of the Improvement Project as well as certain financing costs related thereto pursuant to the City’s Ordinance No. 6597 adopted on September 6, 2017, and any ordinances amending such ordinance (collectively, the “Assessment Ordinance”). The Bonds are secured by the assessments applicable to the Property (the “Assessments”) as hereafter described under “SECURITY FOR THE BONDS.” The District is located within the master planned community of Skye Canyon, which is located in the northwest section of the Las Vegas Valley, positioned south of Kyle Canyon Road (SR 157) and on both sides of U.S. 95 at Horse Drive (now Skye Canyon Park Drive). At buildout, the District is expected to include approximately 1,177 single family homes and a charter school site (which is expected to be subject to Assessments). The master developer of Skye Canyon and the Property is KAG Development West LLC (the “Developer”). Section 12 LLC owns one parcel totaling approximately 444 acres within the District, portions of which (approximately 28 acres) are expected to be transferred to the Developer and included in two parcels upon finalization of the parent maps for such parcels, as further described herein. The Developer and Section 12 LLC are affiliates of the Olympia group of companies. The Olympia group of companies is a privately-held developer of commercial and retail real estate and has developed master planned communities and retail centers throughout the Las Vegas Valley. See “THE DISTRICT— The Development Plan” and “— The Developer and the Contracted Project Manager.” Of the approximately 649 gross acres in the District, approximately 213 net assessable acres are planned for residential uses with approximately 5.48 net assessable acres planned for a charter school site. Approximately 43 gross acres within the District are planned for streets, parks, arroyos, trails, open spaces, community center, and other non-assessable uses. See “SECURITY FOR THE BONDS— Property Values” for a description of the expected reapportionment of the Assessments within the District which are expected to result in approximately 218 net acres being subject to Assessments. See “THE DISTRICT.”

*

Preliminary, subject to change.

1

This Official Statement includes brief descriptions of the Bonds, the District and certain other matters. Summaries of the Indenture, the Development and Financing Agreement, dated as of August 16, 2017, by and between the City and the Developer (the “Financing Agreement”) and the Assessment Ordinance are set forth in Appendix A. Such descriptions and summaries do not purport to be comprehensive or definitive. All references herein to any of the aforesaid documents are qualified in their entirety by reference to the forms thereof, which are available for inspection at the office of the City Treasurer in Las Vegas, Nevada. Capitalized terms not defined herein shall have the respective meanings ascribed to them in Appendix A hereto or, if not defined in Appendix A, the meanings ascribed to them in the Indenture. THE BONDS Authority for Issuance Proceedings for the formation of the District were commenced pursuant to a petition filed with the City by the Developer pursuant to the Act. Pursuant to the Financing Agreement, the Developer agreed, and pursuant to separate agreements with the City, Section 12 LLC and Pardee Homes also agreed, that the District could be created, the Assessments could be levied and, for all other purposes relating to the District, the City could proceed in accordance with the expedited procedures contained in Sections 271.710 et seq. of the Act. Following the receipt of certain plans and specifications and reports concerning the District and the Improvement Project, the City Council formed the District, authorized the acquisition of the Improvement Project, and assessed the costs and expenses thereof against the Property on September 6, 2017. On September 6, 2017, the City adopted Ordinance No. 6597, authorizing the issuance of the Bonds. The Bonds are being issued and are secured pursuant to the terms of the Indenture. General Provisions The Bonds will be dated the date of their delivery to the Underwriter (the “Dated Date”) and bear interest at the respective rates, and mature on the respective dates and in the respective amounts set forth on the inside front cover of this Official Statement. Such interest will be calculated on the basis of a 360-day year consisting of twelve 30-day months and will be payable on June 1 and December 1 of each year commencing December 1, 2017 (each such date, an “Interest Payment Date”). Interest on the Bonds due on December 1, 2017 will be paid from capitalized interest. Interest on each Bond shall be payable from the Interest Payment Date next preceding the date of authentication thereof, unless it is authenticated after the 15th day of the month preceding an Interest Payment Date (the “Record Date”) and on or prior to the next succeeding Interest Payment Date, in which event interest shall be payable from such Interest Payment Date, or unless it is authenticated on or before the first Record Date, in which event interest shall be payable from the Closing Date; provided, however, that if, at the time of authentication of any Bond, interest is in default on Outstanding Bonds, interest on such Bond shall be payable from the Interest Payment Date to which interest has previously been paid or made available for payment on the Outstanding Bonds and shall be payable to the Owners thereof of record as of a special date established by the Trustee following such default. The Bonds will be issued as fully registered bonds and will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York (“DTC”). DTC will act as securities depository for the Bonds. Ownership interests in the Bonds may be purchased in book-entry form only in denominations of $5,000 and any integral multiple thereof. See the subsection below entitled “Book-Entry System.”

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Book-Entry System DTC will act as securities depository for the Bonds, and the Bonds will be registered in the name of Cede & Co. (DTC’s partnership nominee). One fully-registered Bond will be issued for each maturity of the Bonds in the aggregate principal amount of such maturity and will be deposited with DTC. So long as Cede & Co. is the registered owner of the Bonds, references herein to the Owners or Holders of the Bonds shall mean Cede & Co. and shall not mean the actual purchasers of the Bonds (the “Beneficial Owners”). Principal, redemption premium, if any, and interest on the Bonds will be payable by the Trustee to Cede & Co., which is obligated in turn to remit such payments to DTC’s participants for subsequent disbursement to the Beneficial Owners. The City does not give any assurance that DTC, its participants or others will distribute payments with respect to the Bonds or notices concerning them to the Beneficial Owners or that DTC will otherwise serve and act in the manner described in this Official Statement. See Appendix C for a further description of DTC and its book-entry system. The information presented therein concerning DTC and DTC’s book-entry system is based solely on information provided by DTC, and no representations are made by the City or the Underwriter concerning the accuracy or completeness thereof. Redemption* Optional Redemption. The Bonds maturing on and before June 1, 2027, are not subject to redemption prior to maturity, except from prepaid Assessments as set forth in the Indenture. The Bonds maturing on and after June 1, 2028, are subject to redemption prior to their fixed maturity dates, in whole or in part, in integral multiples of $5,000, at the option of the City, on any date on and after June 1, 2027, from funds derived by the City from any source (other than prepaid Assessments or the proceeds derived from the foreclosure of delinquent Assessments), and deposited in the Redemption Fund, at a redemption price equal to the sum of the principal amount of each Bond or the portion thereof so redeemed and accrued interest thereon to the date of redemption, without premium. Mandatory Sinking Fund Redemption. The Bonds maturing on June 1, 20__ (the “20__ Term Bonds”) will be called before maturity and redeemed, from the sinking fund payments that have been deposited into the Bond Fund, on June 1, 20__, and on each June 1 thereafter prior to maturity, in accordance with the schedule of sinking fund payments set forth below. The 20__ Term Bonds so called for redemption will be selected by the Trustee by lot and will be redeemed at a redemption price for each redeemed 20__ Term Bond equal to the principal amount thereof, plus accrued interest to the redemption date, without premium, as follows: Sinking Fund Redemption Date (June 1)

Sinking Fund Payments $

(maturity) Redemption from Prepaid Assessments. The Bonds are subject to redemption prior to their fixed maturity dates, in whole or in part, in integral multiples of $5,000, on any Interest Payment Date, from and to the extent of any prepaid Assessments or proceeds derived from the foreclosure of delinquent *

Preliminary, subject to change.

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Assessments required to be applied thereto pursuant to the Indenture, at the applicable redemption price (expressed as a percentage of the principal amount of Bonds to be redeemed) set forth below and accrued interest thereon to the date of redemption: Redemption Dates

Redemption Price

December 1, 2017 through December 1, 2024 June 1, 2025 and December 1, 2025 June 1, 2026 and December 1, 2026 June 1, 2027 and any Interest Payment Date thereafter

103% 102 101 100

The portion of said prepaid Assessments or foreclosure proceeds required to be applied to the redemption of Bonds and certified by the City to the Trustee to have been received by the City at least 61 days prior to the next succeeding Interest Payment Date shall be applied to the redemption of Bonds on such Interest Payment Date; the portion of said prepaid Assessments or foreclosure proceeds certified by the City to the Trustee to have been received by the City fewer than 61 days prior to the next succeeding Interest Payment Date shall be applied to the redemption of Bonds on the Interest Payment Date following such next succeeding Interest Payment Date. Notwithstanding the foregoing, the amount of any such prepaid Assessment which is less than $5,000 and cannot be used by such Interest Payment Date to redeem Bonds may be used to pay the principal of or interest on the Bonds due on such Interest Payment Date; and provided further that all or any portion of such prepaid Assessment may be used to pay the principal of or interest on the Bonds if necessary to avoid or cure a default in the payment of principal of or interest on the Bonds. Selection of Bonds for Redemption. Whenever provision is made in the 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 Bonds, among maturities of Bonds as directed by the City in writing, and (b) with respect to any redemption from prepaid Assessments or proceeds derived from the foreclosure of delinquent Assessments, among maturities of all Bonds on a pro rata basis as nearly as practicable, unless the City Treasurer determines that the Assessment Installments will be sufficient to pay the principal of and interest on the Bonds that would remain outstanding on each Interest Payment Date subsequent to the redemption date using a different method of selecting Bonds to be redeemed, in which case, the City Treasurer will provide the Trustee with written instructions as to which Bonds shall be redeemed. Bonds of the same maturity, including the 20__ Term Bonds, shall be selected by lot 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. Redemption Procedures. When redemption of Bonds is authorized or required pursuant to the Indenture, the Trustee shall give notice of the redemption of the Bonds. Such notice shall specify: (a) that the Bonds or a designated portion thereof (in the case of redemption of a Bond in part but not in whole) are to be redeemed and the Series designation and CUSIP numbers of the Bonds to be redeemed, (b) the date of redemption, (c) the place or places where the redemption will be made, and (d) the redemption price. Such notice shall further state that on the specified date there shall become due and payable upon each Bond to be redeemed, the principal and redemption premium, if any, together with interest accrued to said date, and that from and after such date interest thereon shall cease to accrue and be payable. Said notice shall be delivered electronically as long as the nominee of DTC or a successor depository is the Owner of the Bonds, and otherwise by first class mail postage prepaid, to the respective Owners of any Bonds designated for redemption at their addresses appearing on the Bond registration 4

records, at least 20 days but not more than 60 days prior to the redemption date; provided that any defect in any notice so mailed shall not affect the sufficiency of the proceedings for the redemption of such Bonds. Failure to give such notice to the Owner of any Bond, or any defect therein, shall not affect the validity of the proceedings for the redemption of any Bonds. Notwithstanding the provisions of this section, any notice of redemption may contain a statement that the redemption is conditioned upon the receipt by the Trustee of funds on or before the date fixed for redemption sufficient to pay the redemption price of the Bonds so called for redemption, and that if such funds are not available, such redemption shall be canceled by written notice to the owners of the Bonds called for redemption in the same manner as the original redemption notice was mailed. Debt Service Schedule The following table sets forth the annual debt service for the Bonds assuming no optional redemption or redemption from prepayments of Assessments. Year Ending June 1

Principal

Interest

Total

5

Total

SOURCES AND USES OF FUNDS The following table sets forth the sources and estimated uses of proceeds derived from the sale of the Bonds and certain other funds. Sources: Principal Amount of Bonds Less Net Original Issue Discount Total

$ $

Uses: Construction Fund Capitalized Interest Account of Bond Fund(1) Reserve Fund(2) Costs of Issuance(3) Total (1) (2) (3)

$

$

Interest on the Bonds due on December 1, 2017 will be paid from capitalized interest. Equals the Reserve Requirement as of the date of issuance of the Bonds. Includes Underwriter’s discount, legal fees, Financial Advisor fees, Trustee fees, Appraiser fees, City administrative expenses and other costs of issuing the Bonds.

LIMITATION OF LIABILITY The amounts on deposit in the Bond Fund, the Redemption Fund and the Reserve Fund established under the Indenture constitute the only available funds of the City to be used for payment of the Bonds in the event of delinquency in the payment of the Assessment Installments. Upon depletion of the moneys in those funds, neither the Owners nor any other person, corporation or association will have any right at law or equity to compel the City, by mandamus or otherwise, to advance or expend any other moneys of the City for payment of the Bonds during the pendency of such delinquencies. The City will only be required either to cause the sale of the delinquent parcel or prosecute foreclosure proceedings as set forth in the Indenture. See “SECURITY FOR THE BONDS — Enforcement Proceedings.” The Bonds do not constitute a debt of the City; and the City shall not be liable thereon except from (a) the Assessments, including all interest and penalties, if any, thereon and the right to enforce the same, all upon the terms and conditions set forth in the Indenture, (b) all moneys and securities from time to time held in the Bond Fund, the Redemption Fund and the Reserve Fund, and (c) any and all other real or personal property of every name and nature specially pledged as additional security for the Bonds (the “Trust Estate”). The full faith and credit of the City is not pledged to the payment of the Bonds; and the payment of the Bonds is not secured by an encumbrance, mortgage or other pledge of property of the City except the pledge of the Trust Estate. SECURITY FOR THE BONDS Assessments The payment of the amount of each Assessment, including each installment thereof, the interest thereon and any penalties and collection costs is secured by an assessment lien upon the applicable parcel of Property. Such lien is coequal with the latest lien thereon to secure the payment of general (ad valorem) property taxes, is not subject to extinguishment by the sale of any property on account of the 6

nonpayment of general (ad valorem) property taxes and is prior and superior to all liens, claims, encumbrances and titles other than the liens of assessments and general (ad valorem) property taxes. The Assessments are pledged to secure the payment of the principal of, premium, if any, and interest on the Bonds, and, as received by or otherwise credited to the City, will immediately be subject to the lien of such pledge. Although the Assessments constitute liens upon the parcels that comprise the Property, they do not constitute a personal indebtedness of the owners of said parcels. There can be no assurance as to the financial or legal ability, or the willingness, of such property owners to pay the Assessments. All Assessment Installments will be invoiced through special assessment bills administered by the City through a private firm. See “Collection of Assessments and Delinquencies” below and Appendix A — “CERTAIN DEFINITIONS AND SUMMARY OF LEGAL DOCUMENTS — THE ASSESSMENT ORDINANCE.” Assessment Installments are to be collected until the Assessment against each parcel is paid or prepaid in full. The City Treasurer shall, within thirty days after the end of each calendar month in which Assessment Revenues are received, transfer such amounts to the Trustee for deposit as provided in the Indenture; provided, however, that if there are not sufficient amounts in the Bond Fund and Reserve Fund to pay the interest and principal, if any, due on the Bonds on the next Interest Payment Date, any Assessment Revenues received during the period from May 1 to May 15 shall be transferred by the City Treasurer to the Trustee no later than May 31 and any Assessment Revenues received during the period from November 1 to November 15 shall be transferred by the City Treasurer to the Trustee no later than November 30. However, in accordance with the Indenture, Assessment Revenues derived from the foreclosure of a delinquent Assessment Installment shall be deposited to the Reserve Fund or the Assessment Revenue Fund, as provided in the Indenture. See “— Reserve Fund” below. Prepaid Assessments and, if the City Council has exercised its option to cause the whole amount of the unpaid Assessment with respect to such Property to become due and payable, proceeds derived from the foreclosure of the whole amount of the unpaid Assessment, shall be deposited in the Redemption Fund. “Assessment Revenues” are defined in the Indenture to mean the proceeds of the Assessments received by or on behalf of the City, including any prepayments thereof, interest and penalties thereon and proceeds of the sale of Property sold as a result of foreclosure of the lien of the Assessments. On the Business Day immediately preceding each Interest Payment Date, the Trustee shall withdraw from the Assessment Revenue Fund and transfer to the funds the amounts in the following order of priority: (1) to the Bond Fund, Assessment Revenues in the amount, if any, necessary to cause the amount on deposit in the Bond Fund to be equal to the principal and interest due on the Bonds on such Interest Payment Date; and (2) to the Reserve Fund, Assessment Revenues in the amount, if any, necessary to cause the amount in the Reserve Fund to be equal to the Reserve Requirement. On June 2 of each year or the Business Day immediately succeeding such June 2, the Trustee shall transfer any amounts remaining in the Assessment Revenue Fund to the City for deposit to the Administration Fund. See Appendix A — “CERTAIN DEFINITIONS AND SUMMARY OF LEGAL DOCUMENTS — THE INDENTURE  Funds and Accounts.” The interest rate applicable to the Assessments will be fixed at 100 basis points (one percentage point) higher than the highest rate of interest on the Bonds. Thus, the aggregate amount of the Assessment Installments to be billed to the owners of the Property within the District each year will be higher than the scheduled payment of principal of and interest on the Bonds payable from such Assessment Installments. This difference between the amount of the Assessment Installments billed and the debt service on the Bonds is intended to provide the City with a source of funds to help address any delinquencies in the payment of scheduled Assessment Installments. The following table compares the scheduled Assessment Installments for each Bond Year with the scheduled payments of principal of and 7

interest on the Bonds payable from such Assessment Installments. The amount of the Assessment Installments received each year in excess of debt service on the Bonds will be available to pay costs of the administration of the District. COMPARISON OF ESTIMATED ASSESSMENT INSTALLMENTS AND BOND PAYMENTS* Year Ending (June 1) 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047

Estimated Assessment Installments(1) $423,344 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688 846,688

Debt Service

Debt Service Coverage(2)

$406,850 740,200 742,850 740,150 742,275 739,050 740,650 741,900 742,800 742,675 741,475 739,875 742,500 743,325 743,475 742,950 741,750 743,000 738,250 742,750 741,000 743,250 739,250 739,250 743,000 740,250 741,250 740,750 738,750 740,250

1.04 1.14 1.14 1.14 1.14 1.15 1.14 1.14 1.14 1.14 1.14 1.14 1.14 1.14 1.14 1.14 1.14 1.14 1.15 1.14 1.14 1.14 1.15 1.15 1.14 1.14 1.14 1.14 1.15 1.14

*

Preliminary, subject to change. Based on an interest rate on the Assessments of 6.0% and no credit for any investment earnings. (2) Calculated by dividing “Estimated Assessment Installments” column by “Debt Service” column. Source: Estimated Assessment Installments provided by Assessment Management Group, Inc.; Debt Service provided by the Underwriter. (1)

The Bonds do not constitute a debt of the City, and the City shall not be liable thereon except as provided in the Indenture. In the event of a delinquency in the payment of any Assessment Installment, the City will not have any obligation with respect to the Bonds other than to apply the amounts on deposit in the Bond Fund, the Reserve Fund and the Redemption Fund to the payment of the Bonds, and to commence and pursue, or cause to be commenced and pursued, sale or foreclosure proceedings with respect to the property in question (but only if and to the extent the commencement and pursuit of sale or foreclosure proceedings is required pursuant to the Indenture; see “Enforcement Proceedings” below). 8

Property Values The extent to which the Assessments provide security for the Bonds is, at least in part, a function of the value of each of the parcels that comprise the Property. An appraisal of the Property, dated August 17, 2017 (the “Appraisal”), has been prepared by Continental Realty Advisors-VSG (the “Appraiser”), a copy of which is set forth in Appendix F. The Appraisal reports an estimated market value of the Property based on a development approach for the Property that included aspects of the income, market and cost approaches to determine the value. Based upon the methodology and assumptions set forth in the Appraisal, the estimated market value of the Property as of August 1, 2017 (the “Date of Value”) was $41,240,000. Such value results in an overall market value to Assessment lien ratio of approximately 3.55 to 1*. Such estimated market value to lien ratio is for the Property as a whole. The Assessment lien to value ratio of individual lots within the District varies. It is a condition to the issuance of the Bonds that the Appraiser deliver a certificate dated as of the date of delivery of the Bonds to the effect that nothing has come to its attention that would lead it to believe that the market values of the Property are less than the values reported in the Appraisal. The Appraisal merely indicates the Appraiser’s opinion as to the market value of the Property as of the date and under the conditions specified therein. The Appraisal is not a prediction of the value of the Property in the future. The Appraisal is specifically made subject to certain assumptions, including, among others, that the ultimate property uses (in terms of unit densities and price points) conform to the overall project description as described therein. In order for the current development program to remain in place, it will be necessary for the Developer to advance the funds necessary to complete the Improvement Project, since proceeds derived from the sale of the Bonds are to be used only to acquire the Improvement Project from the Developer upon completion of various segments thereof. See “CERTAIN RISK FACTORS — Development Uncertainties — Financing.” A list of the other assumptions upon which the values indicated in the Appraisal are based is contained in Appendix F. If any of the Appraiser’s assumptions is not realized, the value of the Property may be less than estimated in the Appraisal. The Appraisal refers to and relies upon reports concerning the Las Vegas housing market that were prepared by various consultants, including the market absorption study prepared by RCG Economics LLC (the “Market Absorption Consultant”), which is attached hereto as Appendix G. See “— Market Absorption Study” below. As the Property is subdivided, the Assessment is expected to be apportioned to the subdivided parcels generally in accordance with the methodology set forth in the Assessment Ordinance. That methodology provides that the unpaid Assessment is to be apportioned on a net assessable area basis unless such land is being divided into single family residential units or residential condominium units, in which case the allocation is made on a per unit basis. The City may also reapportion assessments on tracts (whether currently within the District or later added to the District) with the consent of property owners whose assessment will be increased thereby pursuant to Act and in accordance with the Assessment Ordinance). See Appendix A — “CERTAIN DEFINITIONS AND SUMMARY OF LEGAL DOCUMENTS — THE ASSESSMENT ORDINANCE  Apportionment of Assessments.” The values of various portions of the Property, once they have been subdivided, may vary depending upon factors such as location and anticipated land use. Thus, because the Assessment will be apportioned primarily on the net assessable area (or in the case of single family residential units or residential condominium unit, on a per unit basis), the ratio of the future value of the various parcels to the Assessment applicable thereto will not be uniform but will vary depending upon factors such as the applicable land use.

*

Preliminary, subject to change.

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The District consists of approximately 649 gross acres within the approximately 1,700 acre master planned community known as Skye Canyon. On the date of issuance of the Bonds, all 649 gross acres within the District will be subject to the Assessment lien. Section 12 LLC owns one parcel totaling approximately 444 acres within the District, portions of which (approximately 28 acres) are expected to be transferred to the Developer and included in two parcels upon finalization of the parent maps for such parcels. Following the recording of such parent maps, the Assessments originally imposed on the land owned by Section 12 LLC are expected to be reapportioned by the City onto approximately 28 acres of such property then to be owned by the Developer. After such reapportionment, the District is anticipated to include 218 net assessable acres. Notwithstanding the foregoing, the Financing Agreement permits the initial Assessments to be reapportioned by the City onto not less than 203 acres, provided the Assessment lien per net assessable acre does not exceed $58,000. Section 12 LLC, as the other major property owner within the District, will also agree at or prior to the delivery of the Bonds to not request a reapportionment of the Assessments on the Property it owns in a manner that would cause the Assessments on its property to exceed $58,000 per acre. The City will covenant in the Indenture to enforce the foregoing limitations on any reapportionments requested by the Developer or Section 12 LLC. No limitations exist, however, on reapportionments of the Assessments requested by parties other than the Developer or Section 12 LLC (such as merchant builders) and, while the City does not presently expect any such request to be made, the City, with the consent of the requesting landowner, may agree to a reapportionment of the Assessments owned by such landowner in a manner that exceeds $58,000 per acre. The Engineer’s Report prepared by the City in connection with the formation of the District currently sets a net assessable area basis rate of $53,116.99 per acre. See “THE DISTRICTGeneral.” Market Absorption Study In order to project the absorption of the planned 1,177 residential units to be developed within the District, the City engaged RCG Economics LLC, Las Vegas, Nevada (the “Market Absorption Consultant”) to perform an analysis of the product mix characteristics as well as the macroeconomic and microeconomic factors that are expected to influence the absorption of the forthcoming products in the District. In connection therewith, the Market Absorption Consultant delivered its Market Absorption Study. The Market Absorption Consultant concludes that the Las Vegas Valley economy is recovering at a moderate pace from the recession in the late 2000’s and is likely to remain healthy through the District’s absorption period (approximately 2017-2023). To project housing demand for each type of for-sale product in the District, the Market Absorption Consultant calculated the average rate of new home absorption for active subdivisions in the Las Vegas Valley as a whole and for three submarkets in the Las Vegas Valley – the northwest, the southwest and Henderson. The Market Absorption Consultant’s projected absorption rate for the District is also based upon the schedule of lot sales to merchant builders provided by the Developer and an assumed six month period for each merchant builder to commence home sales. Based on the foregoing and subject to assumptions set forth in the Market Absorption Study, the Market Absorption Consultant projects that the last home sales in the District will occur during the first quarter of 2023. Collections of Assessments and Delinquencies The City has responsibility for, among other things, collecting the Assessment Installments and commencing enforcement proceedings as necessary. The Assessment Installments will not be collected along with regular property taxes, but rather will be billed by the City directly to the owners of parcels in question. Therefore, rates of delinquencies in the payment of general property taxes may not be indicative of rates of delinquencies which might be expected in connection with the collection of Assessment Installments.

10

Assessment Installments are due on April 1 and October 1 of each year, commencing April 1, 2018. Pursuant to NRS 271.415(5), the City Treasurer will notify the owners of real property within the District of the amounts becoming due. Such notice shall state that the assessment installment is payable not later than the April 1 or October 1 next succeeding such notice. The City expects to mail, or cause to be mailed, bills on approximately March 1 and September 1 with respect to the Assessment Installments due on April 1 and October 1, respectively. To assist it in administering the District, the City has contracted with a private firm, Assessment Management Group, Inc. (“AMG”), to prepare and mail the assessment bills and to monitor and report to the City with respect to collections and delinquencies. Under the City’s arrangement with AMG, the Assessment Installments are still payable to the City, and collections thereof are deposited into the City’s bank accounts. AMG provides similar services for other special improvement districts within the unincorporated areas of the County and a total of 120 similar districts elsewhere in Nevada. The first Assessment Installment will be due on April 1, 2018. Therefore, there are no delinquencies within the District at this time. The Developer represents that it has never knowingly been delinquent in the payment of assessments in Nevada. Enforcement Proceedings Upon the failure of a property owner to pay an Assessment Installment when due the City has the option either to commence foreclosure proceedings on the amount of the delinquent Assessment Installment or cause the whole amount of the applicable Assessment to become due and payable immediately. The City may exercise its option to cause the whole amount of the Assessment to become due and payable immediately by the commencement of foreclosure or sale proceedings on the whole amount of the Assessment, and it is currently the policy of the City to exercise said option except in cases where the owner of the subject parcel is the subject of a proceeding in bankruptcy. The amount of the unpaid principal and accrued interest shall bear a penalty at the rate of 2% (or at any higher rate authorized by statute or any lower rate, which may be zero percent, for such period as may be determined by the City Treasurer) per month (not prorated for any portion of the month) commencing 15 days after the date on which the delinquent installment become due until the day of the foreclosure sale, or until the whole amount of the unpaid principal plus interest and penalties, if any, is paid. At any time prior to the date of the sale, the owner of the property may pay the aggregate amount of all delinquent installments originally becoming due on or before the date of said payment, with accrued interest thereon and all penalties and costs of collection accrued, and shall thereupon be restored to the right thereafter to pay future installments in the same manner as if default had not been suffered. In the event that any lot, tract or parcel of land assessed is delinquent in the payment of its Assessment or any installment of principal or interest, the City Treasurer promptly shall mark the Assessment Installment delinquent on the assessment roll for the District and shall notify the owner of such delinquent property, if known, in writing of such delinquency, by first-class mail, postage prepaid, addressed to the addressee’s last-known address. Unless such Assessment Installment plus accrued interest and penalties thereon have been paid in full, the City Treasurer shall proceed with the collection or enforcement of any delinquent Assessment Installment, or the whole amount of the Assessment with respect to such property if the City has exercised its option to cause the whole amount of said Assessment to become due and payable, by giving notice of the sale of the property subject to the lien of the delinquent Assessment or by proceeding to foreclosure on the Assessment as provided in NRS Sections 271.545 through 271.630. If the City exercises its option to proceed with foreclosure under NRS Section 271.625, all proceedings supplemental to the judgment in such foreclosure action, including appeal, period of redemption, sale and issuance of a deed, are to be conducted in accordance with the law relating to property sold upon foreclosure of mortgages or liens upon real property, except that there shall be no personal liability upon the property owners for any deficiency in the proceeds of such sale. 11

The City conducts foreclosure sale proceedings semi-annually in January and July of each year. All parcels that the City has offered for sale in connection therewith have been successfully sold for at least the full amount of the applicable Assessments. However, in some cases the City has been delayed in offering parcels for sale because the owners thereof have filed for bankruptcy protection. See “CERTAIN RISK FACTORS  Enforcement Delays - Bankruptcy.” Under no circumstances is the City required to bid for, or otherwise become the owner of any parcel with a delinquent Assessment Installment. Prosecution of Foreclosure Actions by Owners and Other Remedies. If any such sale or foreclosure proceedings are not promptly filed and diligently prosecuted by the City, any Owner may file and prosecute a foreclosure action in the name of the City. Any Owner may also proceed against the City to protect and enforce the rights of the Owners under the Assessment Ordinance and the Act by suit, action or special proceedings in equity or at law either for the appointment of a receiver or for the specific performance of any provision contained in the Assessment Ordinance or in the Act or in an award of execution of any power granted in the Assessment Ordinance for the enforcement of any proper legal or equitable remedy as such Owner may deem most effectual to protect and enforce the aforesaid rights. All such proceedings shall be instituted, had and maintained for the equal benefit of all Owners of the Bonds then outstanding. The failure of Owners to so foreclose upon the property which is the subject of such delinquent Assessments or to proceed against the City, or both, shall not relieve the City or any of its officers, agents or employees of any duties to take the actions described above. If an Event of Default under the Indenture occurs, the Trustee may, and upon the written request of the Owners of a majority in aggregate principal amount of the Bonds then outstanding, and upon being indemnified to its satisfaction, shall exercise any and all remedies available pursuant to law including, without limitation, the right: (1) to file and prosecute a foreclosure action pursuant to the Act in the name of the City; (2) by mandamus or other action or proceeding or suit at law or in equity to enforce its rights against the City or any officer or employee thereof, and to compel the City or any such officer or employee thereof, to observe or perform their duties under applicable law and the conditions, covenants and terms contained in the Indenture required to be observed or performed by them; (3) by suit in equity to enjoin any acts or things which are unlawful or which violate the rights of the Trustee; or (4) by suit in equity upon the happening of any Event of Default under the Indenture to require the City and its officers and employees to account as the trustee of an express trust. All rights of action (including the right to file proof of claims) under the Indenture or any of the Bonds may be enforced by the Trustee without the possession of any of the Bonds or the production thereof in any trial or other proceeding relating thereto, and any such suit or proceeding instituted by the Trustee shall be brought in its name as Trustee, without the necessity of joining as plaintiffs or defendants any Owners of the Bonds, and any recovery of judgment shall be for the equal and ratable benefit of the Owners of the Bonds then outstanding. All such proceedings shall be instituted, had and maintained for the equal benefit of all Owners of Bonds then outstanding. The failure of the Owners or the Trustee to foreclose upon the property that is the subject of delinquent Assessments, or to proceed against the City, or both, shall not relieve the City or any of its officers, agents or employees of its duty so to take the actions set forth in the Indenture. Reserve Fund The Indenture establishes a Reserve Fund which will be held by the Trustee and into which there will be initially deposited from the proceeds of the sale of the Bonds the amount so indicated under the heading “SOURCES AND USES OF FUNDS.” Said amount is the Reserve Requirement as of the date of issuance of the Bonds. The Reserve Requirement shall be recalculated upon (i) any redemption of 12

Bonds from prepaid Assessments (such adjustments shall be downward but never upward); or (ii) the issuance any Refunding Bonds (as defined in the Indenture). The Reserve Fund is a special trust fund to be held by the Trustee as a continuing reserve to secure the payment of the Bonds by meeting possible deficiencies in the payment of the principal of and the interest on the Bonds resulting from the failure to deposit into the Bond Fund sufficient funds to pay such principal and interest as the becomes due. Upon the sale of or foreclosure upon the Property which is the subject of a delinquent Assessment Installment, or upon the owner of such Property paying prior to the date of sale the amount of the delinquent Assessment Installments, the City shall deposit such moneys received (net of the costs of collection) in the Reserve Fund if necessary to restore the Reserve Fund to the Reserve Requirement and the City shall deposit any remaining moneys to the Assessment Revenue Fund. If the City Council has exercised its option to cause the whole amount of the unpaid Assessment with respect to such Property to become due and payable, upon the sale of or foreclosure upon the Property which is the subject of such delinquent Assessment, or upon the owner of such Property paying prior to the date of sale the whole amount of the delinquent Assessment, the City shall deposit such moneys received (net of the costs of collection) in the Redemption Fund as provided in the Indenture. The Trustee shall, on or before each June 1 and December 1, transfer any moneys in the Reserve Fund in excess of the Reserve Requirement to the City for deposit to the Construction Fund through December 1, 2020, and thereafter to the Investment Earnings Account in the Rebate Fund. 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 direction of the City, 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. On any date on which Bonds are defeased in accordance with the Indenture, the Trustee shall, if so directed in a written request signed by a City Representative, transfer any moneys in the Reserve Fund in excess of the Reserve Requirement resulting from such defeasance to the entity or fund so specified in such written request, to be applied to such defeasance. At the time the Assessment against any parcel of Property is voluntarily paid in full or in part, the person who owned the Property at the time of such payment shall be entitled to a refund, in cash or by credit against the Assessment, equal to a pro rata share of the balance then in the Reserve Fund, and the Reserve Requirement shall be recalculated (and adjusted downward but never upward) to reflect the payment in full of that Assessment. Such refund, in cash or otherwise, shall be made only to the extent the balance in the Reserve Fund after making the refund would not be less than the Reserve Requirement, as recalculated; but if this structure prevents all or a part of such refund, that refund (or, an additional partial refund, as the case may be) shall be made if and when money is available in the Reserve Fund to make the payment and as otherwise provided in the Indenture. The City retains the right to amend the Indenture and other related documents to provide for other uses of the Reserve Fund in connection with a refunding of the Bonds; and the owners of the Property have no entitlement to any amounts in the Reserve Fund in the event of such an amendment. No Additional Bonds Except for Refunding Purposes In addition to the Bonds, the City may, subject to the requirements of the Act and the Local Government Securities Law (NRS 350.500 to 350.720, inclusive), by Supplemental Indenture establish 13

one or more other series of bonds (the “Parity Bonds”) payable under the Indenture on a parity with the Bonds and secured by a lien upon and pledge of Assessment Revenues equal to the lien and pledge securing the Bonds, but only upon compliance by the City with the provisions of the Indenture, and subject to the following specific conditions, which are conditions precedent to the issuance of any such Parity Bonds: (a)

The City shall not be in default under the Indenture or any Supplemental Indenture.

(b) The Supplemental Indenture providing for the issuance of Parity Bonds shall require that the Reserve Fund established pursuant to the Indenture be increased, if and to the extent necessary, forthwith upon the receipt of the proceeds of the sale of such Parity Bonds to an amount at least equal to the Reserve Requirement. Said deposit may be made from such proceeds or any other source, as provided in said Supplemental Indenture. (c) The Parity Bonds shall be payable as to principal annually on June 1 of each year in which principal falls due, provided that term bonds of any such Parity Bonds shall have a principal maturity date of June 1. The Parity Bonds shall be payable as to interest semiannually on the Interest Payment Dates in each year, excepting the first year. (d) Fixed serial maturities or mandatory sinking fund redemptions, or any combination thereof, shall be established in amounts sufficient to provide for the retirement of all of the Bonds of such additional Series on or before their respective maturity dates. (e) The Parity Bonds shall be subject to redemption prior to their fixed maturity dates, in whole or in part, in integral multiples of $5,000, on any Interest Payment Date, from the portion of prepaid Assessments required, pursuant to the Assessment Ordinance, to be applied to the redemption of Parity Bonds, at the same redemption prices on the same dates as are applicable to the Bonds pursuant to the Indenture. (f) The aggregate principal amount of Bonds or Parity Bonds issued under the Indenture shall not exceed any limitation imposed by law, by the Indenture or by any Supplemental Indenture. (g) The portion of the proceeds of such Parity Bonds not deposited in the Bond Fund (as accrued or capitalized interest) or in the Reserve Fund, and not applied to the payment of Costs of Issuance with respect to said Parity Bonds, shall be applied to the refunding of Bonds or Parity Bonds issued under the Indenture and then Outstanding. (h) Annual Debt Service in each Bond Year, calculated for all Bonds and Parity Bonds to be Outstanding after the issuance of such Parity Bonds, shall be less than Annual Debt Service in such Bond Year, calculated for all Bonds and Parity Bonds Outstanding immediately prior to the issuance of such Parity Bonds. THE DISTRICT The information under this heading includes forward-looking statements. See, “CAUTIONARY INFORMATION REGARDING FORWARD-LOOKING STATEMENTS IN THIS OFFICIAL STATEMENT” on the page immediately preceding the Table of Contents. As previously discussed, such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by such statements. Readers are cautioned not to place undue reliance on such forward-looking statements, which only speak as of the date of this Official Statement. The information provided in this heading has been included because it may be considered relevant to an informed evaluation and analysis of the Bonds and the District. The information under this 14

heading has been obtained from the Developer; and the City has not independently verified it, cannot assure that it is accurate and complete, and makes no representation as to its accuracy and completeness. This discussion presents information about Phase 2 of the development of the approximately 1,700 acre master planned community known as Skye Canyon. The District includes only the Phase 2 community (planned for 1,177 residential units). No assurance can be given that the proposed development of the property within the District will occur or that it will occur in a timely manner or in the configuration or to the density described herein, or that the Developer, any owners or affiliates thereof, or any other property owner described herein will or will not retain ownership of its property within the District. Neither the Bonds nor any of the Assessments are personal obligations of the Developer or any other property owner within the District. The Bonds are secured solely by the Assessments and amounts on deposit in certain of the funds and accounts maintained by the Trustee under the Indenture. See “SPECIAL RISK FACTORS” for a discussion of certain of the risk factors that should be considered in evaluating the investment quality of the Bonds. General Skye Canyon. The Skye Canyon project, including the District, is located within the corporate boundaries of the City. Skye Canyon is an approximately 1,700 acre master planned community situated south of Kyle Canyon Road (SR 157) and on both sides of U.S. 95 at Horse Drive (currently Skye Canyon Park Drive). Skye Canyon is the first new, large master planned community in the Las Vegas Valley since the recession in the late 2000’s and upon build out is projected to encompass a maximum of 9,000 homes, including single family, multi-family and active adult categories. Skye Canyon is expected to feature amenities such as parks, trails, bike lanes throughout, a large community center, schools and commercial retail center with a number of nationally-known anchor tenants. Skye Canyon has been divided into multiple phases for planning and development purposes. The District covers Phase 2 of the Skye Canyon development. Construction within Phase 1 of the Skye Canyon development began in November 2014 and opened for sale in August 2015. The City has not formed a special improvement district within the property included in Phase 1. The Developer has sold all of its Phase 1 lots to merchant builders who are actively developing their projects. Phase 1 of the Skye Canyon development is expected to consist of 754 residential units being developed by Pulte Homes, Pardee Homes, Century Homes, and Woodside Homes (or their homebuilding subsidiaries and divisions). As of September 1, 2017, 377 of the 754 planned residential units within Phase 1 had been sold to individual homeowners. As of September 1, 2017 the Developer has spent approximately $26.8 million on Phase 1 backbone infrastructure and approximately $1.5 million on a neighborhood park, all of which has been completed. Additionally, the Developer had expended approximately $16.5 million to design, engineer and construct Skye Canyon Park, a fully developed community, fitness center and park, available for the benefit of all Skye Canyon residents (subject to applicable rules and regulations). Skye Canyon Park is a 13-acre multi-use gathering place that includes a great room, indoor and outdoor seating areas, coffee bistro, stone fireplaces, barbecue patio, fully equipped fitness center, Junior Olympic-sized pool, sports field, basketball court, jogging path, tot lot, and splash pad. The District. The District is part of the master planned community of Skye Canyon. Aerial photographs of the location of Skye Canyon and a map of the proposed lots within the District appear on pages 17 through 19. The boundaries of the District as shown on the aforementioned photographs and map are approximate and only include the approximately 218 net acres within the District that are expected to be subject to Assessments. Of the approximately 649 gross acres in the District, 213 net 15

assessable acres are planned for residential uses with 5.48 net assessable acres planned for a charter school site. Approximately 43 gross acres within the District are planned for streets, parks, arroyos, trails, open spaces, a completed community center, and other non-assessable uses. See “SECURITY FOR THE BONDS—Property Values” for a description of the expected reapportionment of the Assessments within the District which are expected to result in approximately 218 net acres being subject to Assessments. Included within the District is Assessor’s Parcel No. 126-12-101-002 which totals 443.88 acres extending north and northwest of Phase 2 of Skye Canyon. Portions of such parcel (approximately 28 acres in total) are expected to be incorporated into parcels 2.17 and 2.20 (see Table 1 below). The final mapping of these two parcels is contingent on the City obtaining right of way grants from the BLM to realign a portion of a future limited access freeway (Sheep Mountain Parkway). The City formally applied for the right of way grants from the BLM in April 2017. The Developer and the City expect approval of the right of way grants in the first quarter of 2018. Following the recording of final parent maps for parcels 2.17 and 2.20, the Assessments originally imposed on the land owned by Section 12 LLC are expected to be reapportioned by the City onto the portions of the Section 12 LLC property (approximately 28 acres) that will be incorporated into parcels 2.17 and 2.20. Upon recordation of the parent final map for parcels 2.17 and 2.20 no Assessments will be apportioned on the remaining area within Parcel No. 126-12-101-002. Once the final parent maps for parcels 2.17 and 2.20 have been completed approximately 218 net acres within the District are expected to be subject to Assessments. Zoning entitlements for the District permit up to approximately 1,537 single family residences and a charter school site. The Developer currently anticipates that there will be total of approximately 1,177 single family residences within the District at buildout. As of July 31, 2017, with the exception of an off-site water tank, the engineering, design and construction has commenced on all backbone infrastructure projects within the District. The Developer expects design approval of the offsite water tank in September 2017 and expects to commence construction of the water tank in October 2017. The developable land within the District is currently in the form of raw land with grading having commenced on certain property within the District. A detention basin to the west and an offsite water tank are included as component parts of the District’s infrastructure and partially financed by the District. Certain other area-wide infrastructure improvements have been completed to bring required utility, drainage and roadway improvements to the boundary of the District. Certain existing infrastructure was previously completed through surrounding projects by other developers as well as infrastructure that had been installed during the Developer’s development of Phase 1 of the Skye Canyon development. The Phase 1 work was funded from funds provided by the Developer and its affiliates’ and proceeds of land sales within Phase 1.

16

City of Las Vegas, Nevada Special Improvement District No. 609 (Skye Canyon) Skye Canyon Commercial Center

Phase I

17

SID 609 (Phase II) Future Residential Phases

Boundaries are approximate. District flown on August 23, 2017.

Phase II

N Hualapai Way

City of Las Vegas, Nevada Special Improvement District No. 609 (Skye Canyon)

Skye Canyon Commercial Center 18

Phase I SID 609 (Phase II)

Future Residential Phases

Boundaries are approximate. District flown on August 23, 2017.

Las Vegas Strip

19

The Developer and the Contracted Project Manager The Developer. The Developer is an affiliate of the Olympia group of companies. The Olympia group of companies is a privately-held developer of commercial and retail real estate, master planned communities, and a provider of real estate management and home owner association services. Additionally, the Olympia family of companies encompasses outdoor media, gaming, realty and a philanthropic foundation that sponsors multiple charitable events. The following is a description of certain projects developed by the Olympia group of companies in the Las Vegas Valley. Southern Highlands Master Planned Community. The Southern Highlands master planned community encompasses approximately 2,750 acres and is located approximately 12 minutes southwest of the Las Vegas Strip. More than $200 million has been invested in the development of Southern Highlands and there are plans to expand that investment as the community grows to accommodate more than 20,000 residents. The Southern Highlands community includes more than 20 residential neighborhoods and includes amenities such as an array of parks, open spaces, recreational facilities, and miles of sidewalks for biking and jogging. The community infrastructure includes a 10,000 square foot fire station, public and private schools, and both retail and corporate office centers as well as the Boys & Girls Club of Southern Highlands. Within the Southern Highlands development is a guard-gated community called The Estates, which offers custom estate lots and homes perched along the Southern Highlands Golf Course. Southern Highlands Golf Club. Southern Highlands Golf Club opened in 2000, and is one of only four courses in the world co-designed by both the late Robert Trent Jones, Sr., and Robert Trent Jones, Jr. Southern Highlands Golf Club includes a 42,000 square foot Tuscan-style clubhouse with lounges, a wine room, areas for entertaining, a full range of dining options, and other amenities. Located at the Southern Highlands Golf Club property is the Spa @ Southern Highlands, a 13,000 square foot spa and resort facility. The Spa offers treatment rooms and lounges, a full-service fitness center, state-of-theart cardiovascular center, group exercise studio, private training, lighted outdoor tennis courts, swimming pool, cabanas, an outdoor hot tub, as well as a children’s swimming pool and play area. Southern Highlands Marketplace. Southern Highlands Marketplace is a 190,000 square foot neighborhood retail shopping center. It is anchored by a Smith’s grocery store and a Walgreens pharmacy and also features various retail shops and restaurants. Blue Diamond Center. Located at the intersection of Decatur Boulevard and Blue Diamond Road in the City, the Blue Diamond Center is a 138,000 square foot retail outdoor shopping center. The Blue Diamond Center is currently anchored by an Albertson’s grocery store and also features various retail shops and restaurants. The Contracted Project Manager. The property within the Skye Canyon master planned community is held through various limited liability companies with common ownership. Various lenders acquired the land comprising Skye Canyon through a foreclosure and appointed Kyle Agent LLC as agent for the lenders. Kyle Agent LLC, at the direction of the lenders, contributed certain portions of the land to various investment and development entities. Prior to any sales to merchant builders, the property within the District was owned by the Developer and Section 12 LLC. Upon completion of the final parent maps for two parcels (parcels 2.17 and 2.20) certain portions of the property owned by Section 12 LLC (currently consisting of one parcel of approximately 444 acres), will be transferred to the Developer to be included in parcels 2.17 and 2.20. Kyle Agent LLC engaged Ninety Five Management, LLC to manage and develop Skye Canyon. Ninety Five Management, LLC is a member of the Olympia group of companies. The owners of Ninety Five Management, LLC have a minority interest in the Skye Canyon project through an affiliated entity, 20

Ninety Five Partners, LLC. The owners of Ninety Five Management, LLC have over 25 years of experience managing and developing commercial, residential and mixed-use real estate in southern Nevada, including the master planned community of Southern Highlands. In addition, the owners of Ninety Five Management, LLC, through various affiliated entities, own several commercial shopping centers and an office building in southern Nevada as well as a hotel, a casino, and a movie theater in northern Nevada. The Financing Agreement The Financing Agreement provides for the public infrastructure and facilities to be constructed by the Developer to enable development within the District. With the exception of an offsite water tank, the components of such infrastructure that are anticipated to be reimbursed from proceeds of the Bonds are currently under construction by the Developer and are anticipated to be acquired by the City with Bond proceeds once the infrastructure has been completed. See the caption “Infrastructure Improvements and Financing Plan” below. The Development Plan Projected Development and Sales Plan. The Developer intends to develop the land within the District to the point at which bulk parcels may be sold to merchant builders. The merchant builders will be responsible for all in-tract improvements within their respective developments. The Developer’s current development plan for the District is set forth in Table 1 below, and a diagram showing the locations of the various parcels referred to in the development plan appears on the diagram showing general land use classifications below. As shown on Table 1 below, as of September 1, 2017, the Developer had conveyed one parcel to Pardee Homes and two parcels to Pulte Homes (or their homebuilding subsidiaries and divisions) which are expected to include a total of 256 single family homes. In addition, the Developer has entered into contracts to sell four parcels to Lennar Homes, Richmond American Homes and Woodside Homes (or their homebuilding subsidiaries and divisions), which are expected to include a total of 428 single family homes. Sales to such merchant builders are expected to close prior to the end of October 2017. The remaining five parcels, which the Developer expects to be conveyed to merchant builders in 2018, are planned to include 493 single family homes. Of the approximately 649 gross acres in the District, 213 net assessable acres are planned for residential uses with approximately 5.48 net assessable acres planned for a charter school site. Approximately 43 gross acres within the District are planned for streets, parks, arroyos, trails, open spaces, community center, and other non-assessable uses, including Skye Canyon Park. Completion of the final maps and sales of two parcels (parcels 2.20 and 2.17) are contingent on the completion of the design of certain roadway improvements adjacent thereto (Sheep Mountain Parkway), which in turn, is dependent on the grant of certain right of ways as described below. The sale of parcel 2.17 is contingent on the City obtaining a right of way for Sheep Mountain Parkway. The sale of parcel 2.20 is contingent on the City obtaining a right of way for the Sheep Mountain Parkway and completing design of an access road in the alignment of Sheep Mountain Parkway. Prior to the Bureau of Land Management’s (the “BLM”) (an agency of the United States Department of the Interior) auction of the approximately 1,700 acres that became the Skye Canyon master planned community, the City acquired a right of way easement for a limited access freeway (which is expected to be called Sheep Mountain Parkway). Sheep Mountain Parkway was planned to traverse from I-215 north to US 95 passing through Skye Canyon and then heading east to I-15. In 2014, the United States Congress created Tule Spring Nation Monument which prevented the continuation of the proposed Sheep Mountain Parkway from US 95 to I-15. As a result, the Developer and the City agreed to a realignment of the freeway and a reduction in the overall width of the freeway. Such agreement is included in the 21

Development Agreement for the Skye Canyon Master Planned Community. The City has approved a phased vacation for Sheep Mountain Parkway. The vacation of the Sheep Mountain Parkway, currently dissecting a portion of parcel 2.20 and a small portion of parcel 2.17, is contingent on the City obtaining right of way grants from the BLM. The Developer worked with the City to prepare an application for the right of way grant. The City formally applied for the right of way grants from the BLM in April 2017. The application was accepted by BLM as complete in July 2017 and the Developer and the City expect BLM’s approval of the right of way grant in the first quarter of 2018. See “THE DEVELOPER’S FINANCING PLAN” below. See “THE DEVELOPER’S FINANCING PLAN” below. Set forth in Table 1 below is the Developer’s projection of the development and timing of sales to merchant builders of the lots within the District. As of September 1, 2017, the Developer had conveyed one parcel to Pardee Homes and two parcels to Pulte Homes (or their homebuilding subsidiaries and divisions), which are expected to be developed into neighborhoods of 88, 66 and 102 residential homes, respectively. The Market Absorption Study is based, among other factors, on the Developer’s projected land sales to merchant builders set forth in Table 1 below. The Developer currently believes such schedule is a reasonable projection of future land sales which are subject to change from time-to-time to adapt to the Developer’s perception of the market, outside market factors, and other matters. Table 1 Projected Development and Sales Plan of the District

Parcel 2.14 2.15 (sold – Pardee) 2.16 (sold – Pulte) 2.17 2.20 2.21A 2.21B 2.23A (in escrow – Richmond) 2.23B (sold – Pulte) 2.27 (in escrow – Woodside) 2.28 (in escrow– Richmond) 2.29 (in escrow – Lennar) 2.35 (in escrow – Somerset Academy) Total

Net Acres 12.25 19.92 17.08 16.94 28.17 15.12 16.01 12.52 16.76 19.53 20.32 18.38 5.48 218.48

Land Use Residential Residential Residential Residential Residential Residential Residential Residential Residential Residential Residential Residential Charter School

Projected Dwelling Units 53 88 66 50 178 85 127 96 102 110 100 122 ____ 1,177

Estimated Sales Date 2018 2017 2017 2018 2018 2018 2018 2017 2017 2017 2017 2017 2017

Source: the Developer.

Infrastructure Improvements. The projects which make up the Improvement Project include 70% of the costs associated with a detention basin, 45% of the costs of a water storage tank, two water transmission lines, and street improvements (including grading, paving, curbs, gutters, storm drains, and water and sewer mains). Such improvements are expected to be constructed by the Developer and acquired by the City pursuant to the Financing Agreement. Through July 31, 2017 the Developer had expended approximately $12.0 million of a total estimated budgeted cost of $38.6 million for the backbone infrastructure necessary to develop the 22

property within the District. Approximately $10.1 million of the $38.6 million are eligible to be reimbursed from the net proceeds of the Bonds. Table 2 below provides a summary of the infrastructure components, total budgeted amount for each component, the amounts expended through July 31, 2017 and the estimated balance to complete the improvements. As of July 31, 2017, such costs had been funded by land sale and Developer funding. The Developer expects to fund its remaining development costs from revenues of current and future land sales within the District and from net proceeds of the Bonds. Construction began on the detention basin, arterial roads (Eagle Canyon, Egan Crest and Shaumber roads) as well as the two water transmission mains in January 2017. The Developer expects to complete all on-site infrastructure, the Improvement Project, other on-site projects, and shared cost components by the end of 2018. See “THE DEVELOPER’S FINANCING PLAN” below. Table 2 District Infrastructure Cost Summary Phase 2 Budgeted Amount

Description Planning and Engineering On-Site Infrastructure: Grading Water, Sewer, Storm Drains Street Improvements(1) Dry Utilities Other On-Site: Walls Landscaping Neighborhood Park 3090 Water Transmission Main-EC 3205 Water Transmission Main-S Subtotal Direct Costs Shared Costs: Detention Basin Water Tank Power Feeder Subtotal Shared Costs

$

$

$

1,805,000

Amount Expended through July 31, 2017 $

1,509,000

Balance to Completion $

296,000

2,254,000 3,915,000 3,678,000 2,223,000

1,907,000 1,399,000 289,000

347,000 2,516,000 3,678,000 1,934,000

164,000 3,226,000 1,575,000 1,126,000 873,000 20,839,000

216,000 7,000 576,000 557,000 6,460,000

164,000 3,010,000 1,568,000 550,000 316,000 14,379,000

$

8,057,000 6,571,000 2,025,000 16,653,000

Subtotal Costs before Development Fees

$

Development Fees Total Costs

$

$

$

$

2,652,000 563,000 1,972,000 5,187,000

$

$

5,405,000 6,008,000 53,000 11,466,000

37,492,000

$

11,647,000

$

25,845,000

$

1,125,000

$

349,000

$

776,000

$

38,617,000

$

11,996,000

$

26,621,000

(1)

Includes paving, streetlights, curbs and gutters. Source: the Developer.

The information set forth above reflects the Developer’s present plans for the development of the District which are subject to change from time-to-time in order to adapt to the Developer’s perception of the market, outside market factors, and other matters. The Developer is under no obligation of any kind whatsoever to install any of the necessary infrastructure (other than the improvements to be acquired from the Developer with Bond proceeds); and there can be no assurance that the Developer will have the resources, willingness, and ability to successfully implement the development plan described above. 23

THE DEVELOPER’S FINANCING PLAN The information under this heading includes forward-looking statements. See, “CAUTIONARY INFORMATION REGARDING FORWARD-LOOKING STATEMENTS IN THIS OFFICIAL STATEMENT” on the page immediately preceding the Table of Contents. As previously discussed, such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by such statements. Readers are cautioned not to place undue reliance on such forward-looking statements, which only speak as of the date of this Official Statement. The information provided in this heading has been included because it may be considered relevant to an informed evaluation and analysis of the Bonds and the District. The information under this heading has been obtained from the Developer; and the City has not independently verified it, cannot assure that it is accurate and complete, and makes no representation as to its accuracy and completeness. Infrastructure Improvements and Financing Plan The full development of the District property requires the expenditure of substantial amounts, both directly related to the District property and for other infrastructure improvements located outside of the District. Table 3 below shows the Developer’s current projection of the sources and uses of funds associated with the development of the District property. There can be no assurance that the Developer will have timely access to the sources of funds shown in Table 3 below which are necessary to construct the various public facilities and other capital improvements necessary to complete the proposed development. There can also be no assurance that there will not be any substantial changes in the sources and uses of funds shown in Table 3 below. Although Table 3 reflects the Developer’s current projections, many factors beyond the Developer’s control, or a decision by the Developer to alter its current plans, may cause the actual sources and uses to differ from such projections. Table 3 is presented to show that expected revenues make the development proposed feasible and not to guarantee a particular cash flow to the Developer. Future changes to the Developer’s financial projections will be shown in the Annual Report to be prepared by the Developer pursuant to the Continuing Disclosure Undertaking of the Developer. See Appendix E — “Form of Continuing Disclosure Undertaking of the Developer.” The Developer’s total budgeted cost for the development of the District, including allocable shared costs, is approximately $38.6 million. Such amount does not include the cost of land. Funding of such development costs through July 31, 2017 (approximately $12.0 million) has been provided by the Developer’s and its affiliates’ funding sources and land sales within the District. The Developer expects to obtain the necessary remaining funding (approximately $26.6 million) from proceeds derived from the sale of the Bonds and land sales within the District. The Developer projects that total cash proceeds from its land sales in the District will exceed $72 million. Table 3 below sets forth the Developer’s current estimates of its projected sources and uses to complete the proposed development within the District. Notwithstanding the Developer’s belief that it will have sufficient funds to complete the planned development in the District, no assurance can be given that sources of financing available to the Developer will be sufficient to complete the property development as currently anticipated. While the Developer has made such internal financing available in the past, there can be no assurance whatsoever of its willingness or ability to do so in the future if such financing becomes necessary. Neither the Developer nor any of its affiliates has any legal obligation of any kind to make any such funds available or to obtain loans. If and to the extent funding sources described above are inadequate to pay the costs to complete the Developer’s planned development within the District and other financing by the Developer or its affiliates is not put into place, there could be a shortfall in the funds required to complete the remaining development by the Developer or to pay property taxes or Assessment Installments related to the 24

Developer’s property in the District and portions of the project may not be developed. Many factors beyond the Developer’s control, or a decision by the Developer to alter its current plans, may cause the actual sources and uses to differ from the projections. See “CERTAIN RISK FACTORS” below for a discussion of certain risks relating to real estate development. Table 3 Developer Cash Flow as of July 31, 2017

Description

Total Phase 2 Budget

As of July 31, 2017

Remaining in 2017

2018

13

1

7

5

Number of Parcel Sales Sources of Funds Land Sales (Net) Owner Financing SID Bond Proceeds Total Uses of Funds Planning and Engineering On-Site Infrastructure: Grading Water, Sewer, Storm Drains Street Improvements(1) Dry Utilities Other On-Site Improvements Walls Landscaping Neighborhood Park 3090 Water Transmission Main 3205 Water Transmission Main Subtotal Direct Costs

$

$

72,468,000 5,797,000 10,128,000 88,393,000

$

1,805,000

$

$

6,199,000 5,797,000 11,996,000

$

1,509,000

$

$

35,543,000 35,543,000

$

$

30,726,000 10,128,000 40,854,000

$

296,000

$

-

2,254,000 3,915,000 3,678,000 2,223,000

1,907,000 1,399,000 289,000

347,000 2,516,000 2,837,000 1,934,000

841,000 -

$

164,000 3,226,000 1,575,000 1,126,000 873,000 20,839,000

$

216,000 7,000 576,000 557,000 6,460,000

$

476,000 38,000 550,000 316,000 9,310,000

$

164,000 2,534,000 1,530,000 5,069,000

Shared Costs Detention Basin Water Tank Power Feeder Subtotal Shared Costs

$

8,057,000 6,571,000 2,025,000 16,653,000

$

2,652,000 563,000 1,972,000 5,187,000

$

5,405,000 1,494,000 53,000 6,952,000

$

4,514,000 4,514,000

Development Fees

$

1,125,000

$

349,000

$

488,000

$

288,000

Total Uses of Funds

$

38,617,000

$

11,996,000

$

16,750,000

$

9,871,000

$

6,718,000

$

-

$

-

$

6,718,000

$

43,058,000

$

-

$

18,793,000

$

24,265,000

Repayment of Owner Financing

Net Cash Flow (1)

Includes paving, streetlights, curbs and gutters. Source: the Developer.

The projected sources and uses of funds in Table 3 has been prepared based upon assumptions of future sales revenues, forecasts, development costs, certain estimates, operating costs, property taxes, public facilities financing and other items all of which are subject to change from time-to-time. There can be no assurance that the actual development costs will not exceed projections or occur sooner than projected by the Developer. There can be no assurance that any of the other assumptions made by the Developer in Table 3 will occur or that other matters not considered in the projections will not occur that have an adverse impact on cash available to the Developer for construction of improvements. To the extent that actual revenues are less than the revenues projected in Table 3 or are received more slowly than projected in Table 3, other needed financing mechanisms are not put into place or actual 25

expenses are greater than or occur earlier than projected above, there could be a shortfall in the cash required to complete the development as projected above. See “CERTAIN RISK FACTORS” below for a discussion of certain risks relating to real estate development. Table 4 below summarizes the Developer’s current contracts with builders. As of September 1, 2017, Pardee Homes and Pulte Homes have closed on parcels 2.15, 2.16 and 2.23B. The balance of the property subject to property sales contracts are in escrow with earnest deposits totaling approximately $2.5 million. No other contracts have been executed for the sale of the lots for the remaining planning areas, and there can be no assurance that any of these sales will occur, or if they do occur that they will occur on the dates projected, or for similar amounts. Table 4 Current Builder Contracts Builder Pardee Pulte Richmond Pulte Woodside Richmond Lennar Somerset Academy Total

APN 126-12-710-003 126-12-710-004 126-12-810-002 126-12-410-002 126-12-810-003 126-12-810-004 126-12-810-005

Parcel 2.15 2.16 2.23A 2.23B 2.27 2.28 2.29 2.35

Acreage

Contract Price(1)

Price/Acre

19.92 17.08 12.52 16.76 19.53 20.32 18.38 5.48 129.99

$6,282,000 5,540,400 4,757,600 6,051,600 5,666,610 7,620,000 6,049,998 750,000 $42,718,208

$315,361 324,379 380,000 361,074 290,149 375,000 329,162 136,861 $328,627(3)

(1)

Deposit $

475,760 679,992 762,000 605,000 15,000 $2,537,752

Actual and Estimated Closings(2) March 1, 2017 August 24, 2017 September 2017 August, 24 2017 October 2017 September 2017 October 2017 September 2017

Gross price; excludes deferred compensation. The builder parcels currently under contract have certain closing conditions which must be met prior to closing. Projected closings are based on Developer’s current review of progress towards meeting such closing conditions. (3) Average price/acre. Source: the Developer. (2)

26

CERTAIN RISK FACTORS The purchase of the Bonds involves certain investment risks which are discussed throughout this Official Statement. Each prospective investor should make an independent evaluation of all information presented in this Official Statement in order to make an informed investment decision. Particular attention should be given to the factors described below which, among others, could affect the payment of debt service on the Bonds. General The City has not pledged its general fund, taxing power or revenues (other than the Assessments) to secure the Bonds. The Bonds are not general obligations of the City, the State of Nevada, or any other political subdivision thereof. No governmental entity has pledged its faith and credit for the payment of the Bonds. In order to provide for the timely payment of debt service on the Bonds it will generally be necessary that the Assessment Installments be paid in a timely manner. In the event of delinquencies in the payment of the Assessment Installments, the Reserve Fund may be used (to the extent funds are available therein) to make up the resulting deficiencies in the Bond Fund. In addition, the City is required to initiate foreclosure or sale proceedings with respect to delinquent properties under certain circumstances. However, the failure of the owners of Property to pay the applicable Assessment Installments when due, the depletion of the Reserve Fund, or the inability of the City to derive sufficient funds from foreclosure or sale proceedings to cover delinquent Assessment Installments could result in the inability of the City to make full and punctual payments of debt service on the Bonds. The Assessments do not constitute a personal indebtedness of the owners of the various parcels upon which they have been levied. There is no assurance that such owners will be able to pay the Assessment Installments or that they will in fact pay such Assessment Installments even though financially able to do so. Concentration of Ownership As of September 2017, the Developer owned the majority of the property within the District. There is no guarantee that the Developer will complete the development within the District or when such development will be completed. The general slowing of sales in the housing market, both nationally and locally, could slow or prevent altogether the Developer’s and/or the current and any future merchant builders’ developments within the District. Unless and until ownership of property within the District is broadly diversified, the inability or refusal of the Developer to pay Assessment Installments when due could result in the rapid total depletion of the Reserve Fund. Under such circumstances, there would be insufficient moneys with which to pay principal of and/or interest on the Bonds. See the sections hereof entitled “THE DISTRICTThe Development Plan” and “THE DEVELOPER’S FINANCING PLAN” for information supplied by the Developer with respect to the proposed development within the District. The Assessments are not required by law to be prepaid in connection with any sales by the Developer to merchant builders or by merchant builders to individual homeowners. Development Uncertainties - General The majority of the Property is currently in an undeveloped state. Significant infrastructure must be constructed for the intract and homebuilding within the District to commence. In general, undeveloped land is less valuable than developed land and, therefore, will provide less security for the repayment of 27

the Bonds in the event that the City is required to initiate sale or foreclosure proceedings as a result of delinquencies in the payment of Assessment Installments prior to development of such land. A number of contingencies exist which could slow the rate of, or prevent altogether, the future planned development of the Property. A substantial reduction in the rate at which such portions of the Property may be developed could reduce its value and restrict the diversification of ownership of the Property. Specifically, development of the Property will be contingent upon, among other things, the Developer’s construction of the Improvement Project and certain improvements which are not a part of the Improvement Project. The installation of some of these improvements may require action on the part of entities other than the City over which the City has little or no control. Thus, there can be no assurance that these improvements will be constructed. See THE DISTRICT—The Development Plan—Projected Development and Sales Plan” for a discussion of certain rights of way necessary to develop two parcels within the District. Land development operations are subject to comprehensive federal, state and local regulations. Approvals are required from various governmental agencies in connection with the layout and design of developments, the nature and extent of improvements, construction activity, land use, zoning and building requirements and numerous other matters. Failure to obtain any such approval could adversely affect land development operations. The development and marketing of land within the District may also be adversely affected by competition from other developments, changes in general economic conditions, fluctuations in the real estate market in the area, and other similar factors. The development and marketing of land within the District may be particularly dependent on factors which are particular to southern Nevada. Between 2007 and 2012, the real estate market in southern Nevada experienced a significant downturn with taxable values dropping significantly and many homeowners and developers experiencing foreclosure, bankruptcy and other financial strains. In 2013 the real estate market in Southern Nevada began to stabilize and the aggregate taxable value of real property within the County has increased by approximately 10.1%, 7.7% and 5.8% in fiscal years 2015-16, 201617 and 2017-18, respectively. Unemployment in the Las Vegas-Paradise, Nevada Metropolitan Statistical Area as of July 2017 was approximately 5.4%. Development Uncertainties - Financing The successful development of the Property requires the installation of both public improvements (including the Improvement Project) and private in-tract improvements as well as funding sources for the construction of the residential units. Although proceeds derived from the sale of the Bonds will be available to purchase a portion of the public improvements from the Developer upon completion thereof, the Developer will be required to advance the funds necessary to complete the Improvement Project, and Bond proceeds will not be sufficient to reimburse the Developer for all of such advances. See “THE DEVELOPER’S FINANCING PLAN.” If and to the extent that the cost of the public and private improvements required for the development of the Property is financed through borrowings, such borrowings will increase the public and/or private debt for which the Property serves as security. An increase in such debt could reduce the ability or desire of the Developer or any future property owners in the District to pay the Assessment Installments applicable to their property. There is no assurance that either the Developer or any of the persons or entities that may buy portions of the Property from the Developer will be able to obtain the financing necessary to further improve such Property. Any public borrowing for additional infrastructure that is secured by additional assessments against the Property will reduce the value-to-lien ratio of the Property and might make the Bonds less valuable than they would otherwise be. While the Developer does not expect to request any such financing, and the City has placed certain limits on its ability to impose additional assessments on the Property (see Appendix A — “CERTAIN DEFINITIONS AND SUMMARY OF LEGAL 28

DOCUMENTS — THE INDENTURE — Parity Assessments”), there can be no assurance that such additional assessments will not be imposed. Availability of Water Service The further development of the land within the District will require potable water to meet domestic water consumption and fire protection needs. This means both that the supply of water must be adequate to meet such needs and a delivery system must be in place to distribute sufficient water to the District. The entity responsible for the delivery of water to the land within the District is the Las Vegas Valley Water District (the “Water District”). Under the Water District’s service rules, a final commitment to serve water to a parcel can be made only when the parcel is actually being developed. The Developer expects to receive commitments for water service for phases of development within the District as development thereon is undertaken. The adequacy of the water supply for southern Nevada over the longer term is the responsibility of the Southern Nevada Water Authority (the “Authority”), of which the Water District is a member. Over the past several years, significant drought conditions and regulatory restrictions have affected the availability of water in the Colorado Water Basin to the Authority and the Water District. Both the Water District and the Authority face various challenges in the continued supply of imported water to the District. A description of these challenges as well as a variety of other operating information with respect to the Water District and the Authority is included in certain disclosure documents prepared by the Water District and the Authority. The Water District and the Authority have released certain publicly available documents and have entered into certain continuing disclosure agreements pursuant to which the Water District and the Authority, respectively, are contractually obligated for the benefit of owners of certain of their outstanding obligations to file certain annual reports, notices of certain material events as defined under Rule 15c2-12 of the Securities Exchange Act of 1934, as amended (“Rule 15c2-12”), and annual audited financial statements (the “Water District and Authority Information”) with the Municipal Securities Rulemaking Board Electronic Municipal Market Access system at http://emma.msrb.org. The Water District and Authority Information is not incorporated herein by reference thereto, and the City makes no representation as to the accuracy or completeness of such information. THE WATER DISTRICT AND THE AUTHORITY HAVE NOT ENTERED INTO ANY CONTRACTUAL COMMITMENT WITH THE CITY OR THE OWNERS OF THE BONDS TO PROVIDE WATER DISTRICT AND AUTHORITY INFORMATION TO THE CITY OR THE OWNERS OF THE BONDS. THE WATER DISTRICT AND THE AUTHORITY HAVE NOT REVIEWED THIS OFFICIAL STATEMENT AND HAVE NOT MADE REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ACCURACY OR COMPLETENESS OF THE INFORMATION CONTAINED OR INCORPORATED HEREIN, INCLUDING INFORMATION WITH REGARD TO THE WATER DISTRICT AND THE AUTHORITY. THE WATER DISTRICT AND THE AUTHORITY ARE NOT CONTRACTUALLY OBLIGATED, AND HAVE NOT UNDERTAKEN, TO UPDATE SUCH INFORMATION FOR THE BENEFIT OF THE CITY OR THE OWNERS OF THE BONDS UNDER RULE 15c2-12. Availability of Sewer Service The City is responsible for supplying sewer services to the land within the District and expects to have capacity to serve the land within the District. However, the City makes no guaranty of any kind as to the availability of the sewer service required for the Property. 29

Desert Tortoise and Other Animal and Plant Resources Pursuant to the Endangered Species Act of 1973, the desert tortoise, a reptile native to arid portions of the Southwest United States and Mexico, has been determined by the United States Fish and Wildlife Service to be a threatened species in those areas located north and west of the Colorado River. This determination has resulted in the establishment of certain measures intended to protect the desert tortoise. One of these measures, embodied in the Clark County Habitat Conservation Plan, requires land developers to pay fees that are expected to be used for the acquisition of replacement habitat. The Developer will be required to pay such fees. During recent years the United States Fish and Wildlife Service has listed numerous species of plants and animals as threatened or endangered in various regions of the country. In certain instances, such listings have limited, or prevented altogether, the development of land in such regions. Similarly, the State of Nevada has taken action to protect a number of species including desert tortoises, banded Gila monsters and phainopepla. While neither the City nor the Developer is aware of the presence on the Property of any plant or animal that is currently listed as threatened or endangered, any future such listing of any species located on or adjacent to the Property could negatively affect its ability to be developed for the purposes, within the time frame, and at the cost currently projected by the Developer. Cultural Resources Land development activity can be impacted by the presence of sites identified in the National Register of Historic Places and by the presence of antiquities and/or the remains of Native Americans. While neither the City nor the Developer is aware of the presence on the Property of any such sites or antiquities and/or remains, any future discovery thereof could negatively affect its ability to be developed for the purposes as currently projected by the Developer. Environmental The value of the Property may be adversely affected by the presence, or even by the alleged presence, of hazardous substances. In general, the owner of a parcel may be required by law to remedy conditions of the parcel relating to the releases or threatened releases of hazardous substances. The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as “CERCLA” or the “Superfund Act,” is the most well-known and widely applicable of these laws, but other federal, state and local provisions pertain to hazardous substances as well. Under many of these laws, the owner of property is obligated to investigate and remediate a hazardous substance on such property whether or not the owner had anything to do with the generation or disposal of the hazardous substance. A Phase I Environmental Site Assessment dated November 14, 2014 was prepared by GeoTek Residential Services, LLC for the Skye Canyon development, including the property within the District. In general, such report concluded that no environmental conditions associated with the property within the District were identified. Flood Plains and Washes The Developer has reported that the sites proposed for development within the Property are not located within the 100 year flood plain. However, as is the case throughout the rest of Skye Canyon, there were a number of natural washes on the Property. The Developer will improve or replace these natural drainage ways with adequate drainage facilities as necessary. The Developer expects to complete the drainage facilities necessary to develop the property within the District by the end of 2018. 30

Enforcement Delays - Bankruptcy In the event of a delinquency in the payment of an Assessment Installment, the City is required, under certain circumstances, to commence sale or foreclosure proceedings as described under the heading “SECURITY FOR THE BONDS  Enforcement Proceedings.” However, prosecution of such proceedings could be delayed due to crowded local court calendars or delaying tactics. It is also possible that the City will be unable to realize sale or foreclosure proceeds in an amount sufficient to pay the applicable delinquencies. Moreover, the ability of the City to commence and prosecute sale or foreclosure proceedings may be limited by bankruptcy, insolvency and other laws generally affecting creditors’ rights (such as the Soldiers’ and Sailors’ Relief Act of 1940) and by the laws of Nevada relating to judicial foreclosure. Although bankruptcy proceedings would not cause the liens of the Assessments to become extinguished, bankruptcy of a property owner could result in a delay in the sale or foreclosure proceedings because federal bankruptcy laws provide for an automatic stay of foreclosure and tax sale proceedings. Any such delays could increase the likelihood of a delay or default in payment of the principal of and interest on the Bonds. Moreover, if a bankruptcy court determines that the value of the parcel owned by the property owner in bankruptcy is less than the lien of the Assessment applicable to such property, the amount of the lien could be reduced by the amount of the difference, and the amount of the Assessment that exceeds the reduced lien could be treated as an unsecured claim by the bankruptcy court. The various legal opinions delivered in connection with the issuance of the Bonds, including Bond Counsel’s approving legal opinion, will be qualified as to the enforceability of various legal instruments (including the Bonds), by reference to bankruptcy, reorganization, insolvency and other laws affecting the rights of creditors generally or against municipal corporations such as the City. Governmental Ownership Interests in the Property General. The ability of the City to foreclose the lien of delinquent unpaid Assessment Installments may be limited with regard to properties in which the Federal Deposit Insurance Corporation (the “FDIC”), the Drug Enforcement Agency, the Internal Revenue Service, or other federal agencies such as the Federal National Mortgage Association (“FNMA”) or Freddie Mac, has or obtains an interest. The supremacy clause of the United States Constitution reads as follows: “This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the contrary notwithstanding.” The foregoing is generally interpreted to mean that, unless the United States Congress has otherwise provided, if a federal governmental entity owns a parcel that is subject to Assessment Installments within the District but does not pay taxes and assessments levied on the parcel (including Assessment Installments), the applicable State and local governments cannot foreclose on the parcel to collect the delinquent taxes and assessments. Moreover, unless the United States Congress has otherwise provided, if the federal government has a mortgage interest in the parcel and the City wishes to foreclose on the parcel as a result of delinquent Assessment Installments, the property cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and assessments on a parity with the Assessment Installments and preserve the federal government’s mortgage interest. In Rust v. Johnson 597 F.2d 174 (9th Cir. 1979), the United States Court of Appeal, Ninth Circuit (the “Ninth Circuit”), held that FNMA is a federal instrumentality for purposes of this doctrine, and not a private entity, and that, as a result, an exercise of state power over a mortgage interest held by FNMA constitutes an exercise of state power 31

over property of the United States. For these reasons, the City may be unable to foreclose on property in which the federal government has a mortgage interest, or may not be able to eliminate the federal mortgage in the course of foreclosing, which could materially adversely affect the City’s ability to foreclose or the amount it receives as a result of a foreclosure or both. Property Owned by State and Local Governments. The City does not expect that any portion of the Property that is currently assessed or that is planned to be assessable will be acquired by a public agency for public purposes. However, it is always possible that this could occur. Although the Act permits assessments to be levied on publicly owned property, it creates no special remedy for bond holders if the public agency that owns such property fails to pay an assessment installment. Thus, at least by implication, the general remedies for delinquent assessment installments, foreclosure and sale proceedings, would appear to be available under such circumstances. However, in some other states, the courts have prohibited bond holders from foreclosing or otherwise compelling the sale of publicly owned property in such circumstances on the theory that such actions would be contrary to public policy. In some instances, the courts have suggested the possibility of other remedies, such as actions in inverse condemnation. The law in Nevada on this point is uncertain, and the City can provide no assurance as to the remedy, if any, that would be available to Bond Owners in the event of a failure on the part of a public agency to pay an Assessment Installment applicable to its property. FDIC. In the event that any financial institution making any loan which is secured by real property within the District is taken over by the FDIC, and prior thereto or thereafter the loan or loans go into default, resulting in ownership of the property by the FDIC, then the ability of the City to collect interest and penalties specified by State law and to foreclose the lien of delinquent unpaid Assessment Installments may be limited. The FDIC’s policy statement regarding the payment of state and local real property taxes (the “Policy Statement”) provides that property owned by the FDIC is subject to state and local real property taxes only if those taxes are assessed according to the property’s value, and that the FDIC is immune from real property taxes assessed on any basis other than property value. According to the Policy Statement, the FDIC will pay its property tax obligations when they become due and payable and will pay claims for delinquent property taxes as promptly as is consistent with sound business practice and the orderly administration of the institution’s affairs, unless abandonment of the FDIC’s interest in the property is appropriate. The FDIC will pay claims for interest on delinquent property taxes owed at the rate provided under state law, to the extent that the interest payment obligation is secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and will not pay nor recognize liens for such amounts. If any property taxes (including interest) on FDIC-owned property are secured by a valid lien (in effect before the property became owned by the FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of the FDIC is subject to levy, attachment, garnishment, foreclosure or sale without the FDIC’s consent. In addition, the FDIC will not permit a lien or security interest held by the FDIC to be eliminated by foreclosure without the FDIC’s consent. The Policy Statement states that the FDIC generally will not pay non-ad valorem taxes, including special assessments, on property in which it has a fee interest unless the amount of tax or assessment is fixed at the time that the FDIC acquires its fee interest in the property, nor will it recognize the validity of any lien to the extent it purports to secure the payment of any such amounts. The FDIC has taken a position similar to that expressed in the Policy Statement in legal proceedings brought against Orange County, California in United States Bankruptcy Court and in Federal District Court. The Bankruptcy Court issued a ruling in favor of the FDIC on certain of such claims. Orange County appealed that ruling, and the FDIC cross-appealed. On August 28, 2001, the United States Court of Appeals for the Ninth Circuit issued a ruling favorable to the FDIC except with respect to the payment of pre-receivership liens based upon delinquent property taxes. 32

The City is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency with respect to a parcel within the District in which the FDIC has or obtains an interest, although prohibiting the lien of the FDIC to be foreclosed at a judicial foreclosure sale could reduce or eliminate the number of persons willing to purchase a parcel at a foreclosure sale. Amendments to Indenture The Indenture may be amended in certain respects without the consent of Bond Owners and in other respects with the consent of the Owners of not less than a majority in aggregate principal amount of the Bonds outstanding at the time of adoption of such amendatory or supplemental indenture. See Appendix A — “CERTAIN DEFINITIONS AND SUMMARY OF LEGAL DOCUMENTS — THE INDENTURE — Modification or Amendment of Indenture.” Some Beneficial Owners of the Bonds may have interests which are different from, and in some cases, in conflict with, the interests of other Beneficial Owners. For example, Beneficial Owners who are also owners of any of the parcels that comprise the Property may favor changes to the Indenture that would be opposed by Beneficial Owners who are not owners of such parcels. Thus, it is entirely possible that the Indenture could be amended without the consent of some Beneficial Owners, and even over their objection, in a manner that would adversely impact the value of their Bonds. Loss of Tax Exemption As discussed under the heading “TAX MATTERS,” interest on the Bonds could cease to be excluded from gross income for purposes of federal income taxation, retroactive to the date the Bonds were issued, as a result of future acts or omissions of the City. In addition, it is possible that future changes in applicable federal tax laws could cause interest on the Bonds to be included in gross income for federal income taxation or could otherwise reduce the equivalent taxable yield of such interest and thereby reduce the value of the Bonds. TAX MATTERS Federal Tax Matters In the opinion of Sherman & Howard L.L.C., Las Vegas, Nevada, Bond Counsel, assuming continuous compliance with certain covenants described below, interest on the Bonds is excluded from gross income under federal income tax laws pursuant to Section 103 of the Internal Revenue Code of 1986, as amended to the date of delivery of the Bonds (the “Tax Code”), and interest on the Bonds is excluded from alternative minimum taxable income as defined in Section 55(b)(2) of the Tax Code except that such interest is required to be included in calculating the “adjusted current earnings” adjustment applicable to corporations for purposes of computing the alternative minimum taxable income of corporations as described below. The Tax Code imposes several requirements which must be met with respect to the Bonds in order for the interest thereon to be excluded from gross income and alternative minimum taxable income (except to the extent of the aforementioned adjustment applicable to corporations). Certain of these requirements must be met on a continuous basis throughout the term of the Bonds. These requirements include: (a) limitations as to the use of proceeds of the Bonds; (b) limitations on the extent to which proceeds of the Bonds may be invested in higher yielding investments; and (c) a provision, subject to certain limited exceptions, that requires all investment earnings on the proceeds of the Bonds above the yield on the Bonds to be paid to the United States Treasury. The City will covenant and represent in the Indenture that it will take all steps to comply with the requirements of the Tax Code to the extent necessary to maintain the exclusion of interest on the Bonds from gross income and alternative minimum taxable income (except to the extent of the aforementioned adjustment applicable to corporations) under 33

such federal income tax laws in effect when the Bonds are delivered. Bond Counsel’s opinion as to the exclusion of interest on the Bonds from gross income and alternative minimum taxable income (to the extent described above) is rendered in reliance on these covenants, and assumes continuous compliance therewith. The failure or inability of the City to comply with these requirements could cause the interest on the Bonds to be included in gross income, alternative minimum taxable income or both from the date of issuance. Bond Counsel’s opinion also is rendered in reliance upon certifications of the City and other certifications furnished to Bond Counsel. Bond Counsel has not undertaken to verify such certifications by independent investigation. Section 55 of the Tax Code contains a 20% alternative minimum tax on the alternative minimum taxable income of corporations. Under the Tax Code, 75% of the excess of a corporation’s “adjusted current earnings” over the corporation’s alternative minimum taxable income (determined without regard to this adjustment and the alternative minimum tax net operating loss deduction) is included in the corporation’s alternative minimum taxable income for purposes of the alternative minimum tax applicable to the corporation. “Adjusted current earnings” includes interest on the Bonds. The Tax Code contains numerous provisions which may affect an investor’s decision to purchase the Bonds. Owners of the Bonds should be aware that the ownership of tax-exempt obligations by particular persons and entities, including, without limitation, financial institutions, insurance companies, recipients of Social Security or Railroad Retirement benefits, taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry tax-exempt obligations, foreign corporations doing business in the United States and certain “subchapter S” corporations may result in adverse federal and state tax consequences. Under Section 3406 of the Tax Code, backup withholding may be imposed on payments on the Bonds made to any owner who fails to provide certain required information, including an accurate taxpayer identification number, to certain persons required to collect such information pursuant to the Tax Code. Backup withholding may also be applied if the owner underreports “reportable payments” (including interest and dividends) as defined in Section 3406, or fails to provide a certificate that the owner is not subject to backup withholding in circumstances where such a certificate is required by the Tax Code. Certain of the Bonds may be sold at a premium, representing a difference between the original offering price of those Bonds and the principal amount thereof payable at maturity. Under certain circumstances, an initial owner of such bonds (if any) may realize a taxable gain upon their disposition, even though such bonds are sold or redeemed for an amount equal to the owner’s acquisition cost. Bond Counsel’s opinion relates only to the exclusion of interest on the Bonds from gross income and alternative minimum taxable income as described above and will state that no opinion is expressed regarding other federal tax consequences arising from the receipt or accrual of interest on or ownership of the Bonds. Owners of the Bonds should consult their own tax advisors as to the applicability of these consequences. The opinions expressed by Bond Counsel are based on existing law as of the delivery date of the Bonds. No opinion is expressed as of any subsequent date nor is any opinion expressed with respect to pending or proposed legislation. Amendments to the federal or state tax laws may be pending now or could be proposed in the future that, if enacted into law, could adversely affect the value of the Bonds, the exclusion of interest on the Bonds from gross income or alternative minimum taxable income or both from the date of issuance of the Bonds or any other date, the tax value of that exclusion for different classes of taxpayers from time to time, or that could result in other adverse tax consequences. In addition, future court actions or regulatory decisions could affect the tax treatment or market value of the Bonds. Owners of the Bonds are advised to consult with their own tax advisors with respect to such matters. The Internal Revenue Service (the “Service”) has an ongoing program of auditing tax-exempt obligations to determine whether, in the view of the Service, interest on such tax-exempt obligations is includable in the gross income of the owners thereof for federal income tax purposes. No assurances can be given as to whether or not the Service will commence an audit of the Bonds. If an audit is 34

commenced, the market value of the Bonds may be adversely affected. Under current audit procedures the Service will treat the City as the taxpayer and the Owners may have no right to participate in such procedures. The City has covenanted in the Indenture not to take any action that would cause the interest on the Bonds to lose its exclusion from gross income for federal income tax purposes or lose its exclusion from alternative minimum taxable income except to the extent described above for the owners thereof for federal income tax purposes. None of the City, the Underwriter, or Bond Counsel is responsible for paying or reimbursing any owner with respect to any audit or litigation costs relating to the Bonds. State Tax Matters The Bonds, their transfer, and the income therefrom are free and exempt from taxation by the State or any subdivision thereof except for the tax on estates imposed pursuant to Chapter 375A of NRS and the tax on generation-skipping transfers imposed pursuant to Chapter 375B of NRS. ABSENCE OF LITIGATION The City Attorney is of the opinion that there is no action, suit, proceeding or investigation at law or in equity before or by any court, public board or body, pending or, to his knowledge, threatened against or affecting the City which would (i) adversely impact the City’s ability to complete the transactions described in or contemplated by the Indenture or this Official Statement, (ii) restrain or enjoin the collection of the Assessments (except for bankruptcy proceedings), or (iii) in any way contest or affect the validity of the Bonds, the Indenture, the Assessments, or the transactions described in this Official Statement, or in which an unfavorable decision, ruling or finding would adversely affect the validity or enforceability of the Indenture or the Bonds. NO RATINGS The City has not made, and does not contemplate making, application to any rating organization for a rating on the Bonds. CONTINUING DISCLOSURE The City will execute a continuing disclosure certificate (the “City Disclosure Certificate”) at the time of the closing for the Bonds. The City Disclosure Certificate will be executed for the benefit of the beneficial owners of the Bonds and the City has covenanted in the Indenture to comply with the terms of the City Disclosure Certificate. The City Disclosure Certificate will provide that so long as the Bonds remain outstanding, the City will provide the following information to the Municipal Securities Rulemaking Board, through the Electronic Municipal Market Access (“EMMA”) system: (i) annually, certain financial information and operating data concerning the City and the District; and (ii) notice of the occurrence of certain material events; each as specified in the City Disclosure Certificate. The form of the City Disclosure Certificate is attached hereto as Appendix D. Within the last five years, the City has not failed materially to comply with any prior continuing disclosure undertakings entered into pursuant to Rule 15c2-12 promulgated under the Securities Exchange Act of 1934. Pursuant to an inquiry by the City into its past continuing disclosure compliance, the City became aware that it filed late or failed to file event notices related to ratings changes of certain bonds issued by the City. Those event notices were due in 2013 and 2014 and all required notice filings have now been made. The City filed an amended notice of redemption in June 2016 with respect to certain special improvement district bonds which was after the date of such redemption. Further, the City filed its annual report for fiscal year 2013 one day late and did not link its annual report for fiscal year 2014 to one CUSIP for one series of bonds. The City has retained the Financial Advisor to assist it with future continuing disclosure compliance. 35

The Underwriter does not consider the Developer to be an “obligated person” with respect to the Bonds for purposes of the Rule 15c2-12. However, to assist in the marketing of the Bonds, the Developer has agreed to provide, or cause to be provided on EMMA, updated information with respect to the development within the District (the “Developer Reports”), on a semiannual basis during the development period and notices of certain material events. The Developer Reports will contain updates regarding the development within the District as outlined in Section 4 of the Continuing Disclosure Undertaking (the “Developer Continuing Disclosure Undertaking”) attached as Appendix E. In addition to the Developer Reports, the Developer will agree to provide notices of certain events set forth in the Developer Continuing Disclosure Undertaking. UNDERWRITING Stifel, Nicolaus & Company, Incorporated (the “Underwriter”) is purchasing and reoffering the Bonds pursuant to a Bond Purchase Agreement by and between the City and the Underwriter, pursuant to which the Underwriter agrees to purchase all of the Bonds for an aggregate purchase price of $____________ (being the $____________ aggregate principal amount thereof, less net original issue discount of $____________ and less Underwriter’s discount of $____________). The initial public offering price stated on the inside front cover page of this Official Statement may be changed from time to time by the Underwriter. The Underwriter may offer and sell the Bonds to certain dealers (including dealers depositing said securities into investment trusts), dealer banks, banks acting as agents and others at prices lower than said public offering prices. ADDITIONAL INFORMATION Copies of the Indenture and other documents referred to herein are available upon request and payment to the City of a charge for copying, handling and mailing from Venetta Appleyard, City Treasurer, City of Las Vegas, City Hall, 495 South Main Street, Las Vegas, Nevada 89101. MISCELLANEOUS So far as any statements made in this Official Statement involve matters of opinion, assumptions, projections, anticipated events or estimates, whether or not expressly stated, they are set forth as such and not as presentations of fact, and actual results may differ substantially from those set forth therein. Neither this Official Statement nor any statement that may have been made verbally or in writing is to be construed as a contract with the Owners. The summaries of certain provisions of the Bonds, the Indenture, the Assessment Ordinance and other documents or agreements referred to in this Official Statement do not purport to be complete, and reference is made to each of them for a complete statement of their provisions. Copies are available for review by making requests to the City. The appendices are an integral part of this Official Statement and must be read together with all other parts of the Official Statement. The distribution of this Official Statement has been authorized by the City.

36

APPENDIX A CERTAIN DEFINITIONS AND SUMMARY OF LEGAL DOCUMENTS Certain provisions of the Indenture, the Development and Financing Agreement, and the Assessment Ordinance are summarized below. These summaries do not purport to be complete or definitive and are qualified in their entirety by reference to the full terms of the documents. Purchasers of the Bonds are referred to the complete text of such documents, copies of which are available upon written request from the City’s Chief Financial Officer. THE INDENTURE Certain provisions of the Indenture describing the terms of the Bonds, the redemption provisions thereof, the use of the proceeds of the Bonds, and the requirements for the issuance of Refunding Bonds are set forth elsewhere in this Official Statement. See, “THE BONDS”, “SOURCES AND USES OF FUNDS”, and “SECURITY FOR THE BONDS –No Additional Bonds Except for Refunding Purposes.” Certain Definitions. The following are definitions of certain of the terms used in the Indenture and this Official Statement, and not otherwise defined in this Official Statement. Reference is hereby made to the entire Indenture for the definitions of all terms used in such documents. The following definitions are equally applicable to both the singular and plural forms of any of the terms defined herein: “2017 Bonds” means the “City of Las Vegas, Nevada, Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017 Bonds, issued under the Indenture. “Act” means the Consolidated Local Improvements Law, being Chapter 271 of the NRS, as amended from time to time. “Administration Fund” means the “City of Las Vegas, Nevada, Special Improvement District 609 (Skye Canyon) Local Improvement Bonds Administration Fund” established pursuant to the Indenture and held by the City Treasurer. “Annual Debt Service” means, with respect to any Outstanding Bonds, for each Bond Year, the sum of (a) the interest due on such Bonds in such Bond Year, assuming that such Bonds are retired as scheduled (including by reason of mandatory sinking fund redemptions), and (b) the principal amount of the such Bonds due in such Bond Year (including any mandatory sinking fund redemptions due in such Bond Year). “Assessment Installments” means the installments of principal and interest payable with respect to the Assessments. “Assessment Ordinance” means the ordinance pursuant to which, among other things, the Assessments levied on the Property were levied, as originally adopted or as the same may be amended from time to time in accordance with its terms and the terms of the Act and the Bond Law. “Assessment Revenue Fund” means the “City of Las Vegas, Nevada, Special Improvement District 609 (Skye Canyon) Local Improvement Bonds Assessment Revenue Fund” established and held by the Trustee pursuant to the Indenture.

A-1

“Assessment Revenues” means the proceeds of the Assessments received by or on behalf of the City including any prepayments thereof, interest and penalties thereon and proceeds of the sale of Property sold as a result of foreclosure of the lien of the Assessments. “Assessments” or “Assessment” means, with respect to the Property, or a portion thereof, the aggregate Assessments levied by the City thereon pursuant to and in accordance with the terms of the Assessment Ordinance and, with respect to an individual parcel of the Property, means the Assessment levied by the City thereon pursuant to and in accordance with the terms of the Assessment Ordinance. “Average Annual Debt Service” means, with respect to any Outstanding Bonds, the average of the Annual Debt Service for such Bonds for all Bond Years, including the Bond Year in which the calculation is made. “Bond Counsel” means an attorney or a firm of attorneys whose experience in matters relating to the issuance of obligations by the states and their political subdivisions and the tax-exempt status of the interest thereon is recognized nationally. “Bond Fund” means the “City of Las Vegas, Nevada, Special Improvement District 609 (Skye Canyon) Local Improvement Bonds Bond Fund” established and held by the Trustee pursuant to the Indenture. “Bond Law” means the Local Government Securities Law, being NRS 350.500 to 350.720, inclusive, as amended from time to time. “Bond Year” means each twelve-month period beginning on June 2 in each year and extending to the next succeeding June 1, both dates inclusive, except that the first Bond Year shall begin on the Closing Date and end on June 1, 2018. “Bonds” means, collectively, the 2017 Bonds and any Refunding Bonds. “Business Day” means a day which is not a Saturday, Sunday or legal holiday on which banking institutions in the State, or in any state in which the Office of the Trustee is located, are closed or any date on which the New York Stock Exchange is closed. “Chief Financial Officer” means the Chief Financial Officer of the City. “City” means the City of Las Vegas, Nevada, a municipality and a political subdivision duly organized and existing under the Constitution and laws of the State and the Charter of the City, or any public body succeeding to the rights and obligations of the City. “City Representative” means the City Manager, the Chief Financial Officer, or any other person designated by certificate signed by the City Manager or the Chief Financial Officer to act on behalf of the City with respect to the Indenture. “City Treasurer” means the City Treasurer of the City. “Closing Date” means the date on which the 2017 Bonds, duly authenticated by the Trustee, are delivered to the Original Purchaser thereof.

A-2

“Code” means the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder, including any regulations promulgated under the Internal Revenue Code of 1954, as amended, applicable to the Bonds. “Construction Fund” means the “City of Las Vegas, Nevada, Special Improvement District 609 (Skye Canyon) Local Improvement Bonds Construction Fund” established pursuant to the Indenture and held by the City Treasurer. “Costs of Issuance” means all items of expense directly or indirectly payable by or reimbursable by the City relating to the issuance of the Bonds, including, but not limited to, printing costs relating to the Bonds and the official statement or other offering statement; reproduction and binding costs; initial fees and charges of the Trustee (including legal fees); underwriting discount; actual and reasonable fees and expenses of Bond Counsel; financial and other professional consultant fees; and other reasonable charges and fees incurred in connection with the issuance of the Bonds. “Developer” means KAG Development West LLC, a Delaware limited liability company, and its permitted successors and assigns. “Development and Financing Agreement” means the Development and Financing Agreement, dated as of August 16, 2017 Bonds, between the City and the Developer. “District” means the City of Las Vegas, Nevada, Special Improvement District 609 (Skye Canyon). “Event of Default” means any occurrence or event specified under the Indenture. See, “Events of Default and Remedies” below. “Federal Securities” means federal securities as defined in NRS 349.174, as amended. “Fiscal Year” means any period of 12 consecutive months established by the City as its fiscal year and shall initially mean the period commencing July 1 of any year and ending on the next succeeding June 30. “Indenture” means the Trust Indenture authorizing the issuance of the 2017 Bonds, as originally executed or as the same may from time to time be supplemented or amended by any Supplemental Indenture entered into pursuant to the provisions of the Indenture. “Interest Payment Date” means June 1 and December 1 of each year, commencing December 1, 2017. “Investment Earnings” means interest, earnings or profits received in respect of the investment of money on deposit in any fund or account established under the Indenture. “Maximum Annual Debt Service” means, with respect to any Outstanding Bonds, the largest Annual Debt Service for such Bonds for any Bond Year, including the Bond Year the calculation is made. “NRS” means the Nevada Revised Statutes, as amended from time to time. “Office of the Trustee” means the designated corporate trust office of the Trustee in Los Angeles, California, or such other office as may be specified to the City by the Trustee in writing.

A-3

“Original Purchaser” means Stifel, Nicolaus & Company, Incorporated, Los Angeles, California. “Outstanding” when used as of any particular time with respect to Bonds, means (subject to the provisions of the Indenture) all Bonds theretofore authenticated and delivered by the Trustee under the Indenture except: i.

Bonds theretofore canceled by the Trustee or surrendered to the Trustee

for cancellation; ii. Bonds for the payment or redemption of which funds or Federal Securities in the necessary amount shall have theretofore been deposited with the Trustee pursuant to the Indenture (whether upon or prior to the maturity or redemption date of such Bonds); provided that, if such Bonds are to be redeemed prior to maturity, notice of such redemption shall have been given as provided in the Indenture or provision reasonably satisfactory to the Trustee shall have been made for the giving of such notice; and iii. Bonds in lieu of or in exchange for which other Bonds shall have been authenticated and delivered by the Trustee pursuant to the Indenture. “Owner” when used with respect to a Bond means the person in whose name such Bond shall be registered on the registration books required to be maintained by the Trustee pursuant to the Indenture. “Parity Assessments” means other assessments levied by the City on the assessable property within the District or any portion thereof, pursuant to the Act or any similar law, which are on a parity with the lien of the Assessments. “Parity Value-to-Lien Ratio” means a fraction, (i) the numerator of which is the market value of all or any portion of the assessable property in the District, as set forth in a Qualified Appraisal Report, with respect to which the Parity Value-to-Lien Ratio is being determined, and (ii) the denominator of which is the sum of the principal amount of existing Assessments levied on the assessable property with respect to which the Parity Value-to-Lien Ratio is being determined, plus the principal amount of any Parity Assessments theretofore levied and then proposed to be levied on such property (which shall be expressed, after reducing such fraction, as the numerator of said fraction to the denominator of such fraction). “Permitted Investments” means any investments which at the time of investment are legal investments under NRS 355.170, as amended. “Property” means the real property located within the District, as described in the Assessment Ordinance with respect to which there remain unpaid Assessments. “Qualified Appraisal Report” means a real estate appraisal report which (i) has been prepared by a real estate appraiser selected by the City having an “MAI” designation from The Appraisal Institute, (ii) at the time of its submittal to the City is not more than six months old, (iii) states that it is prepared in accordance with the applicable standards of The Appraisal Institute for such reports, and (iv) employs a methodology and provides limiting conditions that are consistent with the initial appraisal prepared at the time of the creation of the District and the levy of the Assessments.

A-4

“Qualified Engineer” means an engineer (whether independent of the City or employed by the City) or engineering firm or corporation selected by the City having skill, knowledge, and experience in special assessment districts. “Rebate Fund” means the “City of Las Vegas, Nevada, Special Improvement District 609 (Skye Canyon) Local Improvement Bonds Rebate Fund” established and held by the Trustee pursuant to the Indenture. “Rebate Requirement” has the meaning ascribed thereto in the Tax Certificate. “Redemption Fund” means the “City of Las Vegas, Nevada, Special Improvement District 609 (Skye Canyon) Local Improvement Bonds Redemption Fund” established and held by the Trustee pursuant to the Indenture. “Refunding Bonds” means Bonds other than 2017 Bonds issued under the Indenture in accordance with the terms of the Indenture and ranking on a parity with the 2017 Bonds. “Reserve Fund” means the “City of Las Vegas, Nevada, Special Improvement District 609 (Skye Canyon) Local Improvement Bonds Reserve Fund” established and held by the Trustee pursuant to the Indenture. “Reserve Requirement” means, as of any date of calculation, an amount equal to the least of (a) 10% of the initial proceeds of the Bonds, (b) Maximum Annual Debt Service on the Bonds, and (c) 125% of Average Annual Debt Service on the Bonds. For the purposes of subsection (a) of this definition, the term “proceeds” means the aggregate stated principal amount of the Bonds, unless there is more than a de minimis amount (as defined in Section 1.148-1(b) of the Code) of original issue discount or premium, in which case “proceeds” means issue price (determined without regard to pre-issuance accrued interest). The Reserve Requirement shall be recalculated by the Trustee upon: (i) any redemption of Bonds from Prepaid Assessments (adjustments pursuant to this clause (i) must be downward and never upward); or (ii) the issuance of any Refunding Bonds. The Trustee shall promptly notify the City of the existence of any new Reserve Requirement calculated in accordance with the immediately preceding sentence. “State” means the State of Nevada. “Supplemental Indenture” means any indenture amendatory of or supplemental to the Indenture, but only if and to the extent that such Supplemental Indenture is specifically authorized under the Indenture. “Tax Certificate” means the Federal Tax Certificate executed by the City at the time of issuance of the Bonds relating to the requirements of Section 148 of the Code, as originally executed and as it may from time to time be amended in accordance with the provisions thereof. “Trust Estate” means the property pledged and assigned to the Trustee pursuant to the granting clauses of this Indenture. For the avoidance of doubt, the Trust Estate does not include monies held by the City in the Construction Fund, the Administration Fund, and the Rebate Fund. “Trustee” means The Bank of New York Mellon Trust Company, N.A., a national banking association organized and existing under the laws of the United States of America, and any successor thereto permitted under the Indenture.

A-5

“Value-to-Lien Ratio” means a fraction, (i) the numerator of which is the most recent taxable value of the property which is the subject of the proposed combination or reapportionment of Assessments, as certified by the County Assessor, or, in the sole discretion of the City, is the market value of the property which is the subject of the proposed combination or reapportionment of Assessments, as set forth in a Qualified Appraisal Report, and (ii) the denominator of which is the sum of the principal amount of the Assessments which will be levied on such property after the proposed combination or reapportionment (which shall be expressed, after reducing such fraction, as the numerator of said fraction to the denominator of such fraction). “Verification” means a report of an independent firm of nationally recognized certified public accountants verifying the sufficiency of the escrow established to pay the Bonds in full on the maturity, redemption or payment date. Pledges Subject only to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth therein, all of the Assessment Revenues and any other amounts held in the Bond Fund, the Reserve Fund and the Redemption Fund are pledged 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, the Act and the Bond Law. The Assessment Revenues, as received by or otherwise credited to the City, shall immediately be subject to the lien of such pledge without any physical delivery thereof, any filing or further act. Said pledge shall constitute a first lien on such assets. Funds and Accounts Under the Indenture, the following funds and accounts, among others, are established. Moneys in each such fund or account will be held, disbursed, allocated and applied only as provided in the Indenture. Construction Fund. The Construction Fund shall be held by the City Treasurer. Moneys in the Construction Fund shall be applied by the City for the payment of the cost (as defined in the Act) of the acquisition and improvement of the Project and the payment of the Costs of Issuance of the 2017 Bonds. Investment Earnings realized from the investment of the money in the Construction Fund shall be retained in the Construction Fund or, at the option of the City, transferred to the Trustee for deposit to the Investment Earnings Account of the Rebate Fund. When the acquisition and improvement of the Project have been completed, the City shall either (i) transfer any remaining balance of money in the Construction Fund to the Trustee for deposit in the Bond Fund or (ii) retain such balance in the Construction Fund to be applied for the payment of the cost of any additional projects permitted by the Act and agreed to by the City and the Developer pursuant to the Development and Financing Agreement. Any such moneys transferred to the Trustee for deposit in the Bond Fund shall be credited against the Assessment Installments to become due and payable, with an appropriate payment to the owner of any assessed parcel whose Assessment has been paid in full. Administration Fund. The Administration Fund shall be held by the City Treasurer. All money in the Administration Fund shall be used by the City to pay the reasonable administration and other expenses of the City in connection with the Bonds, the Assessments and the Project or principal premium or interest on the Bonds. The amount of any income realized from the investment of the money in the Administration Fund shall be retained in the Administration Fund or, at the option of the City and to the extent permitted by law, transferred to the Trustee for deposit in the Rebate Fund.

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Assessment Revenue Fund. The Assessment Revenue Fund shall be held by the Trustee. At the times specified in the Indenture, the City shall transfer Assessment Revenues received by the City to the Trustee for deposit in the Assessment Revenue Fund; provided, however, that any portion of any such Assessment Revenues that represents prepaid Assessments or the proceeds derived from the foreclosure of delinquent Assessments shall be identified as such when transferred by the City to the Trustee. Proceeds derived from the foreclosure of a delinquent Assessment Installment shall be deposited to the Reserve Fund or the Assessment Revenue Fund as provided in the Indenture. Prepaid Assessments and, if the Council has exercised its option to cause the whole amount of the unpaid Assessment with respect to such Property to become due and payable, proceeds derived from the foreclosure of the whole amount of the unpaid Assessment, shall be deposited in the Redemption Fund. On the Business Day immediately preceding each Interest Payment Date, the Trustee shall withdraw from the Assessment Revenue Fund and transfer to the funds indicated below the amounts described below in the following order of priority: (i) Bond Fund. On the Business Day immediately preceding each Interest Payment Date, the Trustee shall transfer from the Assessment Revenue Fund to the Bond Fund Assessment Revenues in the amount, if any, necessary to cause the amount on deposit in the Bond Fund to be equal to the principal and interest due on the Bonds on such Interest Payment Date. See, “Bond Fund” below. The Trustee shall transfer the monies in the Capitalized Interest Account of the Bond Fund to the Bond Fund on the Business Day immediately preceding December 1, 2017 for use in paying a portion of the interest due on the Bonds on December 1, 2017. (ii) Reserve Fund. On the Business Day immediately preceding each Interest Payment Date, the Trustee shall, after having made any transfers required to be made pursuant to paragraph (i) above, transfer from the Assessment Revenue Fund to the Reserve Fund Assessment Revenues in the amount, if any, necessary to cause the amount in the Reserve Fund to be equal to the Reserve Requirement. See, “Reserve Fund” below. On June 2 of each year or the Business Day immediately succeeding such June 2, the Trustee shall transfer any amounts remaining in the Assessment Revenue Fund to the City for deposit to the Administration Fund. See, “Administration Fund” above. Bond Fund. The Bond Fund shall be held by the Trustee, and a Capitalized Interest Account shall be established within the Bond Fund. On each Interest Payment Date, the Trustee shall withdraw from the Bond Fund for payment to the Owners of the Bonds the principal, if any, of and interest then due and payable on the Bonds, including principal due and payable by reason of mandatory sinking fund redemption of such Bonds. In the event that amounts in the Bond Fund are insufficient for such purposes, 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 Bond Fund. On any date on which Bonds are defeased in accordance with the Indenture, the Trustee shall, if so directed in a written request signed by a City Representative, transfer the amount, if any, representing payments of Assessments deposited in the Assessment Revenue Fund and available to be applied to the payment of the principal of and interest on such Bonds on the next succeeding Interest Payment Date, from the Assessment Revenue Fund to the entity or fund so specified in such written request, to be applied to such defeasance. Reserve Fund. The Reserve Fund shall be held by the Trustee. All amounts deposited in 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 A-7

for payment of the principal of and interest on the Bonds or, in accordance with the provisions of this subsection, 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. See, “Bond Fund” above. The Trustee shall, on or before each June 1 and December 1, transfer any moneys in the Reserve Fund in excess of the Reserve Requirement to the City for deposit to the Construction Fund through December 1, 2020, and thereafter to the Investment Earnings Account in the Rebate Fund. 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 direction of the City, 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. On any date on which Bonds are defeased in accordance with the Indenture, the Trustee shall, if so directed in a written request signed by a City Representative, transfer any moneys in the Reserve Fund in excess of the Reserve Requirement resulting from such defeasance to the entity or fund so specified in such written request, to be applied to such defeasance. Except as provided in the succeeding sentence, at the time the Assessment against any parcel of Property is voluntarily paid in full or in part, the person who owned the Property at the time of such payment shall be entitled to a refund against the Assessment equal to a pro rata share of the Reserve Requirement, and the Reserve Requirement shall be recalculated (and adjusted downward but never upward) to reflect the payment of such Assessment or portion thereof. Such refund shall be made in cash or via credit, at the option of the City. The City shall direct the Trustee where to deposit any such credit. Such refund shall be made by the Trustee only to the extent the balance in the Reserve Fund after making the refund would not be less than the Reserve Requirement, as recalculated, but if this structure prevents all or a part of such a refund, that refund (or, an additional partial refund, as the case may be) shall be made if and when money is available in the Reserve Fund to make the payment. This paragraph does not prevent the City from amending the Indenture, the Assessment Ordinance or any other documents executed in connection with the Bonds to provide for other uses of the Reserve Fund in connection with a refunding of the Bonds and the owners of the Property have no entitlement to any amounts in the Reserve Fund in the event of such an amendment. The City shall direct the Trustee as to the amount of any credit due under this paragraph and the person to whom such credit is payable. Redemption Fund. The Redemption Fund shall be held by the Trustee. The Trustee shall deposit in the Redemption Fund amounts received from the City in connection with the City’s exercise of its rights to optionally redeem 2017 Bonds pursuant to the Indenture and any other amounts required to be deposited therein pursuant to the “Assessment Revenue Fund” and “Reserve Fund” described above or pursuant to any Supplemental Indenture. Amounts in the Redemption Fund shall be disbursed therefrom for the payment of the redemption price of 2017 Bonds redeemed pursuant to the Indenture and to pay the redemption price of Refunding Bonds redeemed under the Supplemental Indenture pursuant to which such Refunding Bonds are issued. If after a redemption of Bonds, funds remain on deposit in the Redemption Fund in an amount insufficient to redeem Bonds or any portion of a Bond in the minimum principal amount of $5,000, such funds shall remain on deposit in the Redemption Fund. Said funds, and any investment earnings thereon, shall be utilized for the next redemption of the Bonds, as directed by the City. Rebate Fund. All moneys at any time in the Rebate Fund are to be held by the Trustee, but such fund and the moneys therein are not a part of the Trust Estate. The Rebate Fund shall be maintained by the Trustee until the Trustee receives written notification from a City Representative that it A-8

be closed. The Trustee shall deposit in the Rebate Fund the amounts required by the Indenture and any amounts provided by the City with instructions to be deposited in the Rebate Fund. The Trustee shall establish and maintain in the Rebate Fund a separate account designated as the “Investment Earnings Account” and a separate account designated as the “Excess Earnings Account.” All moneys in the Investment Earnings Account and the Excess Earnings Account shall be held by the Trustee in trust and shall be applied solely as provided in the Indenture. All Investment Earnings on amounts on deposit in the Excess Earnings Account shall be retained therein. Amounts on deposit in the Investment Earnings Account shall be transferred to the Excess Earnings Account pursuant to the written instructions from a City Representative in accordance with the provisions of the Tax Certificate. No later than May 30 of each year, commencing May 30, 2018, the City shall determine, or caused to be determined, the City’s rebate liability in accordance with the provisions of Section 148(f) of the Code and a City Representative shall (a) inform the Trustee in writing as to the amount, if any, required to be maintained in the Excess Earnings Account in order to provide for the satisfaction of any such liability, and (b) instruct the Trustee to transfer from the Investment Earnings Account to the Excess Earnings Account the amount, if any, necessary to cause the amount on deposit in the Excess Earnings Account equal to the amount required to be maintained therein. After any such necessary transfer and no later than August 1 of each year, commencing August 1, 2018, the Trustee shall transfer any amount remaining in the Investment Earnings Account and any amount on deposit in the Excess Earnings Account which exceeds the amount required to be maintained therein to the Assessment Revenue Fund. Except as set forth in the preceding sentence, amounts on deposit in the Excess Earnings Account shall only be applied to payments made to the federal government in accordance with the Tax Certificate and the written instruction of a City Representative. All money at any time deposited in the Excess Earnings Account 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 “Defeasance” below or anything to the contrary contained in the Indenture, all amounts required to be deposited into or on deposit in the Excess Earnings Account shall be governed exclusively by this Section and by the Tax Certificate (which is incorporated in the Indenture by reference). Investment Authorized Moneys held by the Trustee under the Indenture (i.e., moneys in the Assessment Revenue Fund, the Bond Fund, the Redemption Fund, the Reserve Fund, and the Rebate Fund) shall be invested and reinvested by the Trustee in Permitted Investments, and the City Representative shall direct the Trustee to invest in such Permitted Investments as the City Representative may select, such direction to be received by the Trustee in writing at least two Business Days prior to the availability of moneys; provided, however, that such investment directions shall not be inconsistent with the fiduciary obligations of the Trustee. The Trustee may conclusively rely upon such written direction from the City as to both the suitability and legality of directed investments. To the extent investments are registrable, such investments shall be registered in the name of the Trustee. Absent timely receipt of such written directions, such moneys shall be held uninvested. The Trustee may purchase or sell to itself or any affiliate, as principal or agent, investments authorized by this Section. The Trustee shall be responsible for the safekeeping and for the investment of the moneys held by it in accordance with the written directions of the City Representative, but shall not be liable for any losses from investments so made provided they are made in accordance with such instructions.

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Moneys held by the City Treasurer (i.e., monies in the Construction Fund and the Administration Fund) shall be invested and reinvested by the City Treasurer in Permitted Investments. Moneys in the Construction Fund, the Administration Fund, the Assessment Revenue Fund, the Bond Fund, the Redemption Fund, and the Rebate Fund shall be invested by the City or the Trustee, as applicable, in Permitted Investments maturing not later than the date on which it is estimated by the City that such moneys will be required to be paid out under the Indenture. Up to one half of the moneys in the Reserve Fund shall be invested in Permitted Investments maturing not more than five years from the date of purchase or the final maturity date of the Outstanding Bonds, whichever is earlier and the remaining moneys in the Reserve Fund shall be invested in Permitted Investments maturing not more than two years from the date of purchase or the final maturity date of the Outstanding Bonds, whichever is earlier. Investment Earnings from the investment of moneys in the funds and accounts established under the Indenture shall be retained by the Trustee or the City, as applicable, in such funds and accounts, except as otherwise directed in the Indenture. Modification or Amendment of Indenture The Indenture and the rights and obligations of the City, 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 City and the Trustee may enter into with the written consent of the Owners of a majority in aggregate principal amount of the Outstanding Bonds, exclusive of Bonds disqualified as provided below, which shall have been filed with the Trustee. No such Supplemental Indenture shall (i) extend or have the effect of extending the fixed maturity of any Bond or reducing the amount of principal thereof or reducing any premium payable upon the redemption thereof, without the express consent of the Owner of such Bond, (ii) reduce or have the effect of reducing the interest rate on any Bond or extending the time of payment of interest thereon, without the express consent of the Owner of such Bond, (iii) reduce or have the effect of reducing the percentage of Owners of aggregate principal amount of Bonds Outstanding required for the affirmative vote or written consent to an amendment or modification of any of the Indenture, (iv) modify any of the rights or obligations of the Trustee without its written assent thereto, or (v) modify any of the rights or obligations of the owners of the Property or the Assessment liens on the Property constituting the security for the Bonds, without the express consent of the Owners of all of the Bonds, except as expressly permitted by the Indenture. Any such Supplemental Indenture shall become effective as provided in below. The Indenture or the rights and obligations of the City, 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 City and the Trustee may enter into without the consent of any such Owners, but only to the extent permitted by law and after receipt of a written opinion of Bond Counsel and only (i) to cure, correct or supplement any ambiguous or defective provision contained in the Indenture, (ii) to make such additions, deletions or modifications as may be necessary or desirable to assure exemption from federal income taxation of interest on the Bonds, (iii) to make any change that does not materially adversely affect the rights or interests of any Owner, (iv) to add to the covenants and agreements of any party other covenants to be observed, or (v) to provide for the issuance of Refunding Bonds, and to provide the conditions under which such Refunding Bonds may be issued, subject to and in accordance with the provisions of the Indenture Any such Supplemental Indenture shall become effective upon execution and delivery by the parties to the Indenture. If the consent of any of the Owners is required as described above, the Indenture may be amended by Supplemental Indenture only upon compliance with the provisions of this Section. A copy of the Supplemental Indenture, together with a request to such Owners for their consent thereto, shall be mailed by first class mail, postage prepaid, by the Trustee to each such Owner at his address as set forth A-10

on the registration records maintained pursuant to the Indenture, but failure to mail copies of any such Supplemental Indenture and request shall not affect the validity of the Supplemental Indenture when assented to as in this Section provided. Such a Supplemental Indenture shall not become effective unless there shall be filed with the Trustee the written consents of such of the Owners as are required and described above and a notice shall have been mailed as provided hereinafter in this Section. Any such consent shall be binding upon the Owners giving such consent and on any subsequent Owner of the same Bond, respectively, or a replacement thereof (whether or not such subsequent Owner has notice thereof) unless such consent is revoked in writing by the Owner giving such consent or a subsequent Owner by filing such revocation with the Trustee prior to the date when the notice hereinafter in this Section provided for has been given. After the Owners of the required percentage of the aggregate principal amount of the Bonds shall have filed their consents to such a Supplemental Indenture, the Trustee shall mail a notice to the Owners in the manner previously provided in this Section for the mailing of such Supplemental Indenture, stating in substance that the supplemental indenture has been consented to by the Owners of the required percentage of the aggregate principal amount of the Bonds and will be effective as provided in this Section (but failure to mail copies of said notice shall not affect the validity of such Supplemental Indenture or consents thereto). Such a Supplemental Indenture shall become effective upon the mailing by the Trustee of the last-mentioned notice, and the Supplemental Indenture shall be deemed conclusively binding upon the parties to the Indenture and the Owners at the expiration of 60 days after such mailing, except in the event of a final decree of a court of competent jurisdiction setting aside such consent in a legal action or equitable proceeding for such purpose commenced within such 60 day period. A record consisting of the documents required by this Section to be mailed by the Trustee and a certificate of the Trustee as to its compliance with the requirements of this Section shall be proof of the matters therein stated until the contrary is proved. Parity Assessments So long as the Bonds or any portion thereof remain Outstanding, the City covenants for the benefit of the Owners that it will not levy Parity Assessments unless: (a) a Certificate of the City is delivered to the Trustee before the approval of such Parity Assessments to the effect that (i) no portion of the project or projects for which such Parity Assessments are being levied are to be constructed within the boundaries of the District, or if the project or projects for which such Parity Assessments are being levied are to be constructed within the boundaries of the District, that not more than ten percent (10%) of the total amount of assessments being levied for such project or projects will be levied on property within the District, and (ii) the project or projects to be constructed would not have been required as a condition or requirement of development of land within the District based upon the City’s development standards in existence as of July 1, 2017; or (b) the Parity Value-to-Lien Ratio of all of the assessable property within the District against which property Parity Assessments are to be levied will in the aggregate, immediately after such levy, be not less than 3.00 to 1. Notwithstanding and in clarification of the foregoing, the City is expressly permitted to levy a Parity Assessment on any parcel of property within the District that is not, at the time such Parity Assessment is imposed, subject to an Assessment for repayment of the Bonds, and may do so without complying with clauses (a) and (b) of this Section. Any Certificate of the City pursuant to clause (a) of this Section shall be final and conclusive as to the matters contained therein absent fraud.

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Additional Covenants Additional Obligations; Other Liens. So long as any Bonds are Outstanding, the City will not issue any bonds or other obligations payable from Assessment Revenues, other than Refunding Bonds issued in accordance with the provisions of the Indenture. So long as any Bonds are Outstanding, the City will not create or suffer to be created any pledge of or lien on the Assessment Revenues, other than the pledge and lien of the Indenture. Foreclosure. Promptly (but in no event later than 60 days after the installment due date) upon a default in the due and punctual payment of any Assessment Installment due under the Indenture and under the Assessment Ordinance, the City Treasurer promptly shall mark the assessment installment delinquent on the assessment roll for the District and shall notify the owner of such delinquent property, if known, in writing of such delinquency, by first class mail, postage prepaid, addressed to such owner’s last-known address. Said assessment shall be enforced by the City Treasurer and other officers of the City as provided in NRS 271.545 to 271.630, and the assessment roll and a certified copy of the Assessment Ordinance shall be prima facie evidence of the regularity of the proceeding. The Council shall direct the City Treasurer to give notice of the sale of the property subject to the lien of the delinquent Assessment Installment, or all of the Assessment with respect to such property if the Council has exercised its option to cause the whole amount of the unpaid Assessment with respect to such property to become due and payable (subject to the provisions of set forth under “Events of Default and Remedies” below), and shall sell such property as provided in and pursuant to the Act. In the event that the owner of such property does not prior to the day of sale pay the amount of all delinquent Assessment Installments, with accrued interest thereon and penalties and costs of collection (as further provided in the Assessment Ordinance and the Act), and such property is not sold to a third party purchaser at such sale, the property may be stricken off to the City and held in trust for the benefit of the District pursuant to the Act. Upon the sale of or foreclosure upon the Property which is the subject of such delinquent Assessment Installment, or upon the owner of such Property paying prior to the date of sale the amount of the delinquent Assessment Installments, the City shall deposit such moneys received (net of the costs of collection) in the Reserve Fund if necessary to restore the Reserve Fund to the Reserve Requirement and the City shall deposit any remaining moneys to the Assessment Revenue Fund. If the Council has exercised its option to cause the whole amount of the unpaid Assessment with respect to such Property to become due and payable, upon the sale of or foreclosure upon the Property which is the subject of such delinquent Assessment, or upon the owner of such Property paying prior to the date of sale the whole amount of the delinquent Assessment, the City shall deposit such moneys received (net of the costs of collection) in the Redemption Fund as provided in the Indenture. Compliance with Assessment Ordinance. The City will faithfully observe and perform all the agreements, conditions, covenants and terms contained in the Assessment Ordinance required to be observed and performed by it. Pursuant to the Assessment Ordinance, NRS 271.415, and a resolution of the Council, the Chief Financial Officer of the City has established the interest rate on the Assessments at 1% above the highest interest rate on the 2017 Bonds; provided, however, the City reserves the right (a) to reduce the principal amount of the Assessments to an amount equal to not less than the outstanding principal amount of the Bonds in connection with the issuance of any Refunding Bonds, and (b) to reduce the interest rate on the outstanding Assessment Installments in connection with the issuance of any Refunding Bonds so long as the Assessment Installments to be collected in each Bond Year exceeds the Annual Debt Service due in such Bond Year.

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Collection of Assessment Installments; Reports from City Treasurer. Assessment Installments shall be collected and received from the owners of the Property by the City Treasurer in the manner and at the time or times as prescribed by the Assessment Ordinance. The City Treasurer shall, within thirty days after the end of each calendar month in which Assessment Revenues are received, transfer such Assessment Revenues to the Trustee for deposit as provided in this Indenture; provided, however, that if there are not sufficient amounts in the Bond Fund and Reserve Fund to pay the interest and principal, if any, due on the Bonds on the next Interest Payment Date, any Assessment Revenues received during the period from May 1 to May 15 shall be transferred by the City Treasurer to the Trustee no later than May 31 and any Assessment Revenues received during the period from November 1 to November 15 shall be transferred by the City Treasurer to the Trustee no later than November 30. The City Treasurer, within 60 days following each Assessment payment date shall provide the Trustee with a list of all delinquent Assessment Installments as of such date, specifying (a) the name of the Property owner, if known, (b) the amount of the delinquency, including the amount and year of the Assessment, and (c) the parcel number or other identifying information for the Property against which such delinquent Assessment is levied. Defeasance If any Outstanding Bonds shall be paid and discharged in any one or more of the following ways: (a) by paying or causing to be paid (i) with respect to any Outstanding Bonds, the principal, interest, and redemption premium, if any, on such Bonds Outstanding, as and when the same become due and payable at maturity or on the date of redemption prior thereto; or (b) by depositing with the Trustee, under an escrow deposit and trust agreement or other similar document, (i) with respect to any Outstanding Bonds, an amount which together with the amount of earnings calculated to accrue on any investment of such amounts in legally permitted, noncallable Federal Securities to maturity or applicable redemption date will be sufficient to pay and discharge such Bonds Outstanding (including all principal, interest and redemption premiums, if any) at or before their respective maturity dates, as shall be verified by an independent public accountant, and if such Bonds are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as provided in the Indenture or provision satisfactory to the Trustee shall have been made for the giving of such notice; then, at the election of the City, and notwithstanding that any such Bonds shall not have been surrendered for payment, all obligations of the Trustee and the City under the Indenture with respect to such Outstanding Bonds shall cease and terminate, except only the obligation of the Trustee to pay or cause to be paid to the Owners of such Bonds not so surrendered and paid all sums due thereon. Notice of such election shall be filed with the Trustee. To accomplish the discharge of liability in respect of the Bonds described in the preceding paragraph, the City shall cause to be delivered (a) a Verification, (b) an escrow agreement, and (c) an opinion of nationally recognized bond counsel to the effect that the Bonds are no longer “Outstanding” under the Indenture; each Verification and defeasance opinion shall be acceptable in form and substance to the City and shall be addressed to the City and the Trustee. Notwithstanding anything contained in this Section to the contrary, the fees and expenses of the Trustee (including reasonable counsel fees) must be paid, or provision for such payment satisfactory to the Trustee must be made, in order to effect any discharge of the Indenture and the satisfaction and discharge of the Indenture shall be without prejudice to the right of the Trustee to charge and be reimbursed by the City for any expenditures which it may thereafter incur in connection with the Indenture. Any funds held under the Indenture by the Trustee, at the time of receipt such notice from the City, which are not required for the purpose above mentioned, shall, upon payment of all fees and expenses of the Trustee, including attorneys’ fees, be paid A-13

over to the City. Nothing in the Indenture shall be deemed to limit or prevent the defeasance of less than all of the Outstanding Bonds from any moneys available therefor. Trustee Provisions The City appoints and employs the Trustee to receive, hold, invest and disburse, upon written direction of the City, the moneys to be deposited with the Trustee for credit to the various funds established by the Indenture, to cause the Trustee to authenticate and deliver the Bonds, to apply and disburse the Assessment Revenues collected by the City Treasurer and paid over to the Trustee to and for the benefit of the Owners, and to perform certain other functions all as hereinafter provided. In consideration of the compensation hereinafter provided for, the Trustee accepts such appointment, subject to the terms and conditions of the Indenture. The Trustee, prior to the occurrence of an “Event of Default” described below and after the curing of all Events of Default which may have occurred, undertakes to perform such duties and only such duties as are specifically set forth in the Indenture, and no implied covenants or obligations shall be read into the Indenture against the Trustee. In case an Event of Default has occurred (which has not been cured or waived), the Trustee shall exercise such of the rights and powers vested in it by the Indenture, and use the same degree of care and skill in the exercise of such rights and powers as an ordinary, prudent person would exercise or use in the conduct of his or her own affairs. The City shall from time to time pay the Trustee reasonable compensation for its services, subject to any agreement then in effect with the Trustee, and shall similarly reimburse the Trustee for all its actual and reasonable advances and expenditures, including, but not limited to, actual and reasonable advances to and fees and expenses of independent appraisers, accountants, consultants, counsel, agents and attorneys-at-law or other experts employed by it in the lawful and proper exercise and performance of its powers and duties under the Indenture. To the extent permitted by law, the City also agrees to indemnify the Trustee for, and to hold it harmless against, any loss, liability or expense incurred without negligence or willful misconduct on the part of the Trustee arising out of or in connection with the acceptance or administration of the trusts under the Indenture, as well as the costs and expenses of defending itself against any claim, action, suit or liability in accordance with the exercise or performance of any of its powers or duties under the Indenture. Notwithstanding the foregoing, unless the action or omission giving rise to such indemnification is caused by the gross negligence or willful misconduct of the City, its officers or employees, the City’s obligations in the immediately preceding two paragraphs to indemnify the Trustee shall be limited to amounts then available in the Administration Fund. The City may and, if at any time requested to do so by the Owners of a majority in aggregate principal amount of the Bonds then Outstanding shall, by written request, at any time and for any reason, upon 30 days advance written notice to the Trustee, remove the Trustee, and shall thereupon appoint a successor thereto, but any such successor shall be a bank or trust company doing business, having a combined capital (exclusive of borrowed capital) and surplus of at least $75,000,000, and be subject to supervision or examination by federal or state authority. If such bank or trust company publishes a report of condition at least annually pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus set forth in its most recent report of condition so published. A successor trustee shall be deemed to meet the requirements of this Section if its parent bank meets the capital requirements in the Indenture and guarantees or confirms the performance of all obligations and duties under the Indenture of such successor trustee.

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The Trustee may at any time resign by giving written notice to the City and by giving mailed notice, first class and postage prepaid, to the Owners of its intention to resign and of the proposed date of resignation. Upon receiving such notice of resignation, the City shall promptly appoint a successor trustee by an instrument in writing. No resignation of the Trustee shall take effect until a successor Trustee has been appointed; provided, however, that in the event the City fails to appoint a successor trustee within 30 days following receipt of such written notice of resignation, the resigning Trustee may petition the appropriate court having jurisdiction to appoint a successor trustee. Any resignation or removal of the Trustee shall become effective only upon acceptance of appointment by the successor trustee. Any company into which the Trustee may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Trustee may sell or transfer all or substantially all of its corporate trust business, provided that such company shall be eligible as described above, shall be the successor to the Trustee without the execution or filing of any document or further act, anything in the Indenture to the contrary notwithstanding, so long as such surviving entity shall continue to provide corporate trust services. The Trustee shall be protected and shall incur no liability in acting or proceeding in good faith upon any resolution, notice, telegram, request, consent, waiver, certificate, statement, affidavit, voucher, bond, requisition or other paper or document which it shall in good faith believe to be genuine and to have been passed or signed by the proper board or person or to have been prepared and furnished pursuant to any of the provisions of the Indenture, and the Trustee shall be under no duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument, but may accept and rely upon the same as conclusive evidence of the truth and accuracy of such statements. Whenever in the administration of its duties under the Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or allowing any action under the Indenture, such matter (unless other evidence in respect thereof be specifically required in the Indenture) shall be deemed to be conclusively proved and established by the certificate of a City Representative, and such certificate shall be full warranty to the Trustee for any action taken or suffered under the provisions of the Indenture upon the faith thereof, but in its discretion the Trustee may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as it may deem reasonable. The Trustee may become the Owner of any of the Bonds with the same rights it would have if it were not the Trustee; may acquire and dispose of bonds or other evidences of indebtedness of the City with the same rights it would have if it were not the Trustee; and may act as a 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, whether or not such committee shall represent the Owners of the majority in aggregate principal amount of the Outstanding Bonds. The Trustee may execute any of the trusts or powers and perform the duties required of it under the Indenture by or through attorneys, agents or receivers, and shall be entitled to advice of counsel concerning all matters of trust and its duty under the Indenture. The Trustee shall not be responsible for any recital in the Indenture, in the Bonds (except in respect to the certificate of authentication of the Trustee endorsed on the Bonds), or for any instrument of further assurance, or for the validity of the execution by the City of the Indenture or of any supplements to the Indenture or instruments of further assurance, or for the sufficiency of the security for the Bonds issued under the Indenture or intended to be secured by the Indenture, and the Trustee shall not A-15

be bound to ascertain or inquire as to the performance or observance of any covenants, conditions or agreements on the part of the City, except as set forth in the Indenture; but the Trustee may require of the City full information and advice as to the performance of the covenants, conditions and agreements aforesaid. The Trustee shall not be answerable for the exercise of any discretion or power under the Indenture or for anything whatever in connection with the funds and accounts established under the Indenture, except only for its own negligence or willful misconduct. The Trustee shall not be accountable for the City’s use of the proceeds from the Bonds. Under no circumstances does the Trustee assume any responsibility or liability for the issuance of the Bonds as obligations the interest on which is excludable from gross income for purposes of Federal income taxation or for the maintenance of such tax-exempt status subsequent to the date of issuance of the Bonds. The Trustee shall not be deemed to have knowledge of any Event of Default under the Indenture unless and until it shall have actual knowledge thereof. The Trustee shall have no responsibility with respect to any information, statement or recital in any official statement, offering memorandum or any other disclosure material prepared or distributed with respect to the Bonds. None of the provisions contained in the Indenture shall require the Trustee to expend or risk its own funds or to incur individual financial liability in the performance of any of it duties or in the exercise of any of its rights or powers. Before being required to take any action, the Trustee may require an opinion of counsel acceptable to the Trustee, which opinion shall be made available to the City upon request, which counsel may be counsel to the City, or a verified certificate of the City Representative, or both, concerning the proposed action. If it does so in good faith, the Trustee shall be absolutely protected in relying on any such opinion or certificate. The Trustee shall not be considered in breach of or in default in its obligations under the Indenture or progress in respect thereto in the event of enforced delay in the performance of such obligations due to unforeseeable causes beyond its control and without its fault or negligence, including, but not limited to, Acts of God, terrorism, war, riots, strikes, fire, floods, earthquakes, epidemics or other like occurrences beyond the control of the Trustee; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances. Tax Covenant The City covenants for the benefit of the registered owners of the Bonds that it will not take any action or omit to take any action with respect to the Bonds, the proceeds thereof, any other funds of the City or any facilities financed with the proceeds of the Bonds if such action or omission (i) would cause the interest on the Bonds to lose its exclusion from gross income for federal income tax purposes under Section 103 of the Code, or (ii) would cause interest on the Bonds to lose its exclusion from alternative minimum taxable income as defined in Section 55(b)(2) of the Code except to the extent such interest is required to be included in the adjusted current earnings adjustment applicable to corporations under Section 56 of the Code in calculating corporate alternative minimum taxable income. The foregoing covenant shall remain in full force and effect notwithstanding the payment in full or defeasance of the Bonds until the date on which all obligations of the City in fulfilling the above covenant under the Code have been met. A-16

In the event that at any time the City 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 under the Indenture, the City shall so instruct the Trustee in writing, and the Trustee shall take such action as may be necessary in accordance with such instructions. Notwithstanding any provisions of this Section, if the City 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 Bonds, the Trustee may conclusively rely on such opinion in complying with the requirements of this Section and of the Tax Certificate, and the covenants under the Indenture shall be deemed to be modified to that extent. Events of Default and Remedies If any of the following events occur, it is declared under the Indenture to constitute an “Event of Default”: (i) Default in the due and punctual payment of interest on any Bond, whether at the stated Interest Payment Date or special interest payment date thereof, or upon proceedings for redemption thereof, or otherwise; (ii) Default in the due and punctual payment of the principal of or premium, if any, on any Bond, whether at the stated maturity thereof, or upon proceedings for redemption thereof, or otherwise; (iii) Failure of the City to commence or cause to be commenced enforcement proceedings in accordance with the Indenture, or to diligently pursue or cause to be diligently pursued, any such enforcement proceedings; or (iv) If default shall be made by the City in the observance of any of the other covenants, agreements of conditions (excluding the “Continuing Disclosure” covenant in the Indenture) on its part in the Indenture or in the Bonds contained, and such default shall have continued for a period of 30 days after written notice thereof, specifying such default and requiring the same to be remedied, shall have been given to the City by the Trustee, or to the City and the Trustee by the Owners of not less than 25% in aggregate principal amount of the Outstanding Bonds; provided, however, if in the reasonable opinion of the City the failure stated in the notice can be corrected, but not within such 30 day period, such failure shall not constitute an Event of Default if corrective action is instituted by the City within such 30 day period and the City shall thereafter diligently and in good faith cure such failure in a reasonable period of time provided. If an Event of Default shall happen, then the Trustee may, and upon the written request of the Owners of a majority in aggregate principal amount of the Outstanding Bonds and upon being indemnified to its satisfaction, shall exercise any and all remedies available pursuant to law including, without limitation, the right: (i)

to file and prosecute a foreclosure action pursuant to the Act in the name

of the City; (ii) by mandamus or other action or proceeding or suit at law or in equity to enforce its rights against the City or any officer or employee thereof, and to compel the City or any such

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officer or employee thereof, to observe or perform their duties under applicable law and the conditions, covenants and terms contained in the Indenture required to be observed or performed by them; (iii) by suit in equity to enjoin any acts or things which are unlawful which violate the rights of the Trustee; or (iv) by suit in equity upon the happening of any Event of Default under the Indenture to require the City and its officers and employees to account as the trustee of an express trust. All rights of action (including the right to file proof of claims) under the Indenture or any of the Bonds may be enforced by the Trustee without the possession of any of the Bonds or the production thereof in any trial or other proceeding relating thereto, and any such suit or proceeding instituted by the Trustee shall be brought in its name as Trustee, without the necessity of joining as plaintiffs or defendants any Owners of the Bonds, and any recovery of judgment shall be for the equal and ratable benefit of the Owners of the Outstanding Bonds. Upon the occurrence of an Event of Default, and upon the filing of a suit or other commencement of judicial proceedings to enforce the rights of the Trustee and of the Owners of the Bonds under the Indenture, the Trustee shall be entitled, as a matter of right, to the appointment of a receiver or receivers of the Assessment Revenues and the funds created under the Indenture and of the revenues, earnings, income, products and profits thereof, pending such proceedings, with such powers as the court making such appointment shall confer. No delay or omission of the Trustee or of any Owner of any of the Bonds to exercise any right or power arising upon the happening of any Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or an acquiescence therein, and every power and remedy given by this Section to the Trustee or to the Owners of the Bonds may be exercised from time to time and as often as shall be deemed expedient by the Trustee or the Owners of the Bonds. No remedy conferred in the Indenture upon or reserved to the Trustee or to the Owners of the Bonds is intended to be exclusive of any other remedy, and every such remedy shall be cumulative and shall be in addition to every other remedy given under the Indenture or now or hereafter existing, at law or in equity, by statute, or otherwise. In the event that the Trustee, upon the happening of an Event of Default, shall have taken any action, by judicial proceedings or otherwise, pursuant to its duties under the Indenture, whether upon its own discretion or upon the request of the Owners of a majority in aggregate principal amount of the Outstanding Bonds, it shall have full power, in the exercise of its discretion for the best interests of the Owners of the Bonds, with respect to the continuance, discontinuance, withdrawal, compromise, settlement or other disposal of such action; provided, however, that the Trustee shall not, unless there no longer continues an Event of Default under the Indenture, discontinue, withdraw, compromise or settle, or otherwise dispose of any litigation pending at law or in equity, if at the time there has been filed with it a written request signed by the Owners of least a majority in aggregate principal amount of the Outstanding Bonds opposing such discontinuance, withdrawal, compromise, settlement or other disposal of such litigation. No Owner of any Bond executed and delivered under the Indenture shall have the right to institute any suit, action or proceeding at law or in equity, for any remedy under the Indenture, except as provided below, unless (a) such Owner shall have previously given to the Trustee written notice of the occurrence of an Event of Default, (b) the Owners of at least a majority in aggregate principal amount of the Outstanding Bonds shall have made written request upon the Trustee to exercise the powers A-18

hereinbefore granted or to institute such action, suit or proceeding in its own name and shall have afforded the Trustee a reasonable opportunity to exercise such powers or institute such proceedings, (c) said Owners shall have tendered to the Trustee indemnity reasonably acceptable to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request, and (d) the Trustee shall have refused or failed 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 failure are declared in the Indenture, in every case, to be conditions precedent to the exercise by any Owner of any remedy under the Indenture; it being understood and intended that no one or more Owners of Bonds shall have any right in any manner whatever by his or their action to enforce any right under the Indenture, except in the manner provided in the Indenture, and that all proceedings at law or in equity with respect to an Event of Default shall be instituted, had and maintained in the manner provided in the Indenture and for the equal benefit of all Owners of the Outstanding Bonds. All moneys received by any Owner bringing such proceedings shall be immediately delivered to the Trustee. The right of any Owner to receive payment of principal of and interest on his or her Bond as the same become due, or to institute suit for the enforcement of such payment, shall not be impaired or affected without the consent of such Owner, notwithstanding the foregoing provisions of this Section or any other provision of the Indenture. All moneys received by the Trustee pursuant to any right given or action taken under the provisions of this Section shall be applied by the Trustee in the following order: (i) To the payment of the fees, costs and expenses of the Trustee and of the Owners incurred in exercising their rights and remedies under this Section, including reasonable compensation to its or their agents, attorneys and counsel. (ii) 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 the Indenture, as follows: First: To the payment to the persons entitled thereto of all installments of interest on any Bonds 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; 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; and Third: To the payment into the Reserve Fund, an amount, if any, necessary to cause the amount in the Reserve Fund to be equal to the Reserve Requirement. Notwithstanding the provisions in this Section, the Trustee shall sell Permitted Investments in the Bond Fund and Reserve Fund to the extent necessary to pay and shall apply amounts to the payment of the principal of and interest due on the 2017 Bonds on any Interest Payment Date. A-19

In case the Trustee shall have proceeded to enforce any right under the Indenture by the appointment of a receiver or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely, then and in every such case, the City, the Trustee and the Owners shall be restored to their former positions and rights under the Indenture, respectively, with regard to the Property subject to the Indenture, and all rights, remedies and powers of the Trustee shall continue as if no such proceedings had been taken. THE DEVELOPMENT AND FINANCING AGREEMENT Pursuant to the Development and Financing Agreement, the Developer agrees that the City may create the District, issue the Bonds and levy the Assessments against the property in the District. The Developer is required, at no cost to the City, to transfer title to the City for that portion of its property required for construction of the Project of a size and in a form acceptable to the City free and clear of any mortgage, security interest, easement, lien, or any other encumbrance not previously approved in writing by the City. The Developer agrees to construct or cause the construction of, and the City agrees to acquire, the Project. The Developer is required to prepare final plans and specifications for the Project. These plans and specifications must be approved by the City. The Developer must construct the Project in accordance with the approved plans and specifications. The Developer will pay in cash the amount of any cost overruns incurred in the construction of the Project. Once construction of a particular phase of the Project has been completed, the Developer will provide the City with required documentation necessary for the City to acquire the phase of the Project. Upon acceptance of a phase of the Project, the City will cause the applicable purchase price to be paid to the Developer from amounts on deposit in the Construction Fund. After the City acquires a particular phase of the Project, the Developer will warrant that the improvements have been constructed in accordance with the plans and specifications. The Developer will remedy any defects in any portion of the Project and pay for any damage to other work resulting therefrom which shall appear within one year from the date of transfer of title to the City. The Developer will provide evidence of lien releases to the City. Should the Developer fail to complete a phase of the Project in accordance with the approved final plans therefor prior to the date such plans expire, the City may, at is option, proceed to build, complete, or rebuild any such phase of the Project. The City may apply the proceeds of the Bonds for such purposes. The Developer agrees to pay all costs which exceed the amount available for that purpose from the proceeds of the Bonds. Regardless of whether the acquisition or construction of the Project is completed, the Developer waives all rights to set aside, seek a refund of, enjoin the collection of, or otherwise retrospectively or prospectively be relieved of its obligations to pay, the assessment installments when due. The Developer represents and warrants, to the best of its knowledge after reasonable investigation, that it has all material governmental or other permits required to proceed with development of its property and the Project and has paid all fees relating thereto and any other fees owing with respect to the Project, in each case subject to the exceptions listed in the Development and Financing Agreement. The Developer covenants that it will obtain those permits it does not now have when needed, promptly upon its obtaining knowledge that such permits are needed, and pay all fees due. There is no impediment, to the Developer’s knowledge, to proceeding with the Project to completion and proceeding with the development of the land owned by the Developer in the District.

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The Developer agrees to notify any transferee of property of the existence of the Assessments. The Developer agrees that it will not take any action or omit to take any action with respect to the Bonds, the proceeds thereof, any other funds of the Developer or any facilities financed with the proceeds of the Bonds if such action or omission (i) would cause the interest on the Bonds to lose its exclusion from gross income for federal income tax purposes under Section 103 of the Code; or (ii) would cause interest on the Bonds to lose its exclusion from alternative minimum taxable income as defined in Section 55(b)(2) of the Code except to the extent such interest is required to be included in the adjusted current earnings adjustment applicable to corporations under Section 56 of the Code in calculating corporate alternative minimum taxable income. The Developer agrees to protect and indemnify and hold the City, its officers or employees and agents and each of them harmless from and against any and all claims, losses, expenses, suits, actions, decrees, judgments, awards, attorneys’ fees, and court costs which the City, its officers, employees or agents or any combination thereof may suffer or which may be sought against or recovered or obtained from the City, its officers, employees or agents or any combination thereof as a result of or by reason of or arising out of or in consequence of (i) the acquisition, construction or financing of the Project by the City pursuant to the Development and Financing Agreement, (ii) any environmental or hazardous waste conditions (a) which existed on any property which is part of the Project at any time prior to final acceptance of the Project by the City or an applicable government or which was caused by the Developer or (b) which existed on any of the property which is assessed at any time while the Developer owned the property or which was caused by the Developer, provided said condition was not caused by the deliberate action of the City; or (iii) any act or omission negligent or otherwise of the Developer or any of its subcontractors, agents or anyone who is directly employed by or acting in concert with the Developer or any of its subcontractors, or agents, in connection with the Project or the District. Nothing in the Development and Financing Agreement or any other document involving the District, nor the installation by way of the District of, or the assessment of the property within the District for, the water and sewage facilities shall be taken as a guarantee, promise or representation that water or sewage treatment capacity will be made available to the property in the District. The City is not obligated to expend money other than from funds derived from the sale of the Bonds, amounts received from the investment thereof and amounts received as Assessment payments nor is the City obligated to make any appropriation of funds for the Project. The Development and Financing Agreement remains in effect from the date of execution of the Development and Financing Agreement, until the later of (i) the date that all of the Bonds (including through a series of refundings) have been retired, or (ii) the date on which all of the Assessments against property within the District have been paid in full. The obligations of the Developer under the Development and Financing Agreement (except the obligations to pay Assessments) are obligations of the Developer upon which the Developer is personally liable. The obligations under the Development and Financing Agreement to pay Assessments pertain only to the land owned by the Developer in the District and are not personal obligations of the Developer. THE ASSESSMENT ORDINANCE Certain provisions of the Assessment Ordinance describing, among other things, the status of the Assessments and collection of delinquent Assessments are set forth elsewhere in this Official Statement. See, “SECURITY FOR THE BONDS--Enforcement Proceedings” and “ --Prosecution of Foreclosure by Owners and Other Remedies.” A-21

Levy of Assessments; Creation of Liens The City has levied and assessed against the lots, tracts and parcels of land in the District specially benefited by the Project certain amounts and Assessments, as shown and described in the assessment roll for the District filed in the office of the City Clerk, for the purpose of financing the acquisition and improvement of the Project. The Assessments will be levied on a net assessable area basis unless such land is divided into single-family residential units, in which case the uncollected amounts will be divided on a per unit basis. The unpaid Assessments shall be payable on April 1 and October 1 of each year, commencing on April 1, 2018, in fifty-nine (59) semi-annual substantially equal installments of principal and interest until paid in full, with interest in all cases on the unpaid and deferred installments of principal from the effective date of the Assessment Ordinance at a rate or rates, which shall not exceed by more than one percent (1%) the highest rate of interest on the Bonds issued for the District. The Assessments are a lien upon the lots, tracts and parcels of land in the District specially benefited by the Project from the effective date of the Assessment Ordinance until paid. Pursuant to NRS 271.420, such lien shall be co-equal with the latest lien upon the lots, tracts and parcels to secure the payment of general taxes, shall not be subject to extinguishment by the sale of any property on account of the nonpayment of general taxes, and shall be prior and superior to all liens, claims, encumbrances and titles other than the lien of assessments and general taxes. The sale of any such lot, tract or parcel of land for general or other taxes shall not relieve such lot, tract or parcel of land from such assessment or the lien therefor. Such amounts shall continue to be a lien upon the lots, tracts and parcels of land assessed until paid in full (including all principal and the interest thereon, and any penalties and collection costs). Collection of Assessments The installments of the assessments shall be payable at the office of the City Treasurer. Pursuant to NRS 271.415(5), the City Treasurer shall notify the owners of real property within the District of the amounts becoming due and each such owner shall be deemed notified and shall be responsible for any penalties or delinquencies regardless of such owner’s failure to maintain an accurate mailing address with the County Assessor. Such notice shall state that the assessment installment is payable not later than the April 1 or October 1 next succeeding such notice. Except as provided in the Assessment Ordinance, failure to pay any installment, whether of principal or interest, when due shall cause the whole amount of the unpaid principal of such assessment to become due and payable immediately, at the option of the City, the exercise of said option shall be indicated by the commencement of foreclosure or sale proceedings by the City. See, “SECURITY FOR THE BONDS-Enforcement Proceedings.” The whole amount of the unpaid principal and the interest that has accrued thereon shall, commencing fifteen (15) days after the date on which the delinquent installment became due, whether or not the option to accelerate the due date for the payment of the unpaid principal is exercised, bear a penalty at the rate of 2% (or at any higher rate authorized by statute, or any lower rate, which may be zero percent, for such period as determined by the City Treasurer) per month (not prorated for any portion of the month) on the unpaid balance of the assessment and accrued interest, until the day of the foreclosure sale or until paid; provided that, at any time prior to the day of such sale, the owner of any such lot or parcel may pay the aggregate amount of all of the delinquent installments originally becoming due on or before the date of said payment, with accrued interest thereon and all penalties and costs of collection accrued, and shall thereupon be restored to the right thereafter to pay in installments in the same manner as if a default had not been suffered. Pursuant to NRS 271.445(7), the City is permitted to reduce or waive for good cause the collection of any penalties assessed or additional interest incurred pursuant to the enforcement provisions of the Assessment Ordinance. A-22

Prepayment of Assessment The owner of any property assessed and not in default as to any assessment installment or payment may, at any time (at the option of such owner), pay the whole or any portion of the unpaid principal with interest accruing thereon to the next assessment payment date, together with a prepayment premium equal to three percent (3%) of the principal amount so prepaid. If the Bonds (or any bonds issued to refund the Bonds) may then be redeemed without the payment of any premium, the City, in its sole discretion, may waive the requirement of payment of the prepayment premium. No waiver for a particular prepayment premium shall be deemed to be a waiver for any other prepayment premium. See, “THE BONDS  Redemption.” The owner of any assessed property may, at any time, request the City to provide information as to the total amount which will be due in connection with a proposed prepayment of an assessment by such owner and the City will promptly (but in any event within five (5) business days) provide such information to the owner. After any partial prepayment of an assessment or refunding of the Bonds pursuant to NRS 271.488, the City Treasurer shall reamortize the assessment installments due on the parcel on which the partial prepayment was made or, in the case of a refunding, on all parcels, so that the remaining installments are semiannual substantially level installments of principal and interest with a final due date of April 1, 2047. Apportionment of Assessments Before the collection of all the Assessment Installments, if any lot, tract or parcel of land within the District is divided, the Council may require the City Treasurer to apportion the uncollected amounts upon the several parts of land so divided on a net assessable area basis unless such land is divided into single-family residential units, in which case the uncollected amounts will be divided on a per unit basis. For purposes of such apportionment, the term “net assessable area” shall exclude (i) areas excluded from the definition of “assessable property” pursuant to NRS 271.040, (ii) areas designated on the assessment plat as being areas of non-assessment, and (iii) properties which are conveyed with restrictions limiting the uses of such properties to common areas, parks, landscaped areas and other permanent open space. The City may also reapportion assessments on tracts (whether currently within the District or latter added to the District) with the consent of property owners whose assessment will be increased thereby pursuant to NRS 271.425(3) or NRS 271.710(2) if the Council finds that the proposed action will not: (i) materially or adversely impair the obligation of the City with respect to the Bonds; or (ii) increase the principal balance of any assessment to an amount such that the aggregate amount which is assessed against a tract exceeds the minimum benefit to the tract that is estimated to result from the project which is financed by the assessment. The City covenants for the benefit of the Owners of the Bonds that it will use its best efforts to apportion the Assessments in accordance with the Assessment Ordinance. Additionally, the City has covenanted in the Indenture that it will not reapportion Assessments unless it makes the findings described in clauses (i) and (ii) above. The City has further covenanted that the finding described in clause (i) will not be made unless the Value-to-Lien Ratio (including in the calculation thereof any increase in the Assessment on any parcel as a result of such combination or reapportionment) for each parcel of the property, if any, on which Assessments are increased as a result of such reapportionment is at least 3.00 to 1. In addition, the finding described in clause (ii) will not be made unless the City first obtains a written report of a Qualified Engineer stating that the proposed combination or reapportionment of Assessments will not increase the principal balance of any Assessment to an amount such that the aggregate amount which is assessed against a tract exceeds the minimum benefit to the tract that is estimated to result from the project which is financed by the Assessment. In making either of the findings, the Council will be entitled to rely on the written report of a Qualified Engineer, and such A-23

written report shall be conclusive evidence of the conclusions set forth therein. The Council will not make either of the findings described above unless, as of the effective date of the proposed combination or reapportionment, there are no delinquencies in the payment of Assessment Installments on any parcels on which Assessments will be increased as a result of such combination or reapportionment. The Council’s determination that the apportionment is in accordance with the Assessment Ordinance shall be conclusive and binding upon the owners of the Property and the Owners of the Bonds. The Council’s approval of an apportionment report shall be deemed conclusively to constitute a finding that the apportionment is in accordance with the Assessment Ordinance. Pursuant to Section 3.25 of the Development and Financing Agreement and a separate certificate and acknowledgement executed on the date of issuance of the 2017 Bonds by Section 12 LLC, a Delaware limited liability company (“Section 12”), the Developer and Section 12 have agreed, in connection with any transfer of land owned by the Developer or Section 12 (but not others), to not request a reapportionment of the Assessments onto such transferred land in an amount that exceeds $58,000 per acre. The City covenants to act in good faith in enforcing this covenant against the Developer and Section 12.

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APPENDIX B PROPOSED FORM OF LEGAL OPINION

September__, 2017

City of Las Vegas, Nevada 495 S. Main Street Las Vegas, Nevada 89101 $____________ City of Las Vegas, Nevada Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017 Ladies and Gentlemen: We have acted as bond counsel to the City of Las Vegas, Nevada (the “City”), in connection with the issuance by the City of the above-captioned bonds (the “Bonds”), pursuant to an ordinance of the City Council of the City adopted on September 6, 2017 (the “Ordinance”) and a Trust Indenture dated as of September 1, 2017 (the “Indenture”) between the City and The Bank of New York Mellon Trust Company, N.A. (the “Trustee”). In such capacity, we have examined the City’s certified proceedings and such other documents and such law of the State of Nevada (the “State”) and of the United States of America as we have deemed necessary to render this opinion letter. Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Indenture. Regarding questions of fact material to our opinions, we have relied upon the City’s certified proceedings and other representations and certifications of public officials and others furnished to us, without undertaking to verify the same by independent investigation. Based upon such examination, it is our opinion as bond counsel that: 1. The Bonds, assuming due authentication by the Trustee, constitute valid and binding, special, limited obligations of the City payable solely from the Trust Estate. 2. The Ordinance has been duly adopted by the City and constitutes a valid and binding obligation of the City. 3. The Indenture has been duly authorized by the City, duly executed and delivered by the authorized officials of the City, and assuming due authorization, execution and delivery by the Trustee, constitutes a valid and binding obligation of the City. 4. Interest on the Bonds is excluded from gross income under federal income tax laws pursuant to Section 103 of the Internal Revenue Code of 1986, as amended to the date hereof (the “Tax Code”), and interest on the Bonds is excluded from alternative minimum taxable income as defined in Section 55(b)(2) of the Tax Code, except that such interest is required to be included in calculating the adjusted current earnings adjustment applicable to corporations for purposes of computing the alternative minimum taxable income of corporations. The opinions expressed in this paragraph assume continuous

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compliance with the covenants and the continued accuracy of the representations contained in the City’s certified proceedings and in certain other documents and certain other certifications furnished to us. 5. Pursuant to the Act, the Bonds, their transfer, and the income therefrom are free and exempt from taxation by the State or any subdivision thereof, except for the tax on estates imposed pursuant to Chapter 375A of NRS and the tax on generation-skipping transfers imposed pursuant to Chapter 375B of NRS. The opinions expressed in this opinion letter are subject to the following: The enforceability of the obligations of the City pursuant to the Assessments, the Bonds, the Ordinance, and the Indenture are subject to the application of equitable principles, to the reasonable exercise in the future by the State and its governmental bodies of the police power inherent in the sovereignty of the State, and to bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally, whether considered at law or in equity. In this opinion letter issued in our capacity as bond counsel, we are opining only upon those matters set forth herein, and we are not passing upon the accuracy, adequacy or completeness of the Official Statement or any other statements made in connection with any offer or sale of the Bonds or upon any federal or state tax consequences arising from the receipt or accrual of interest on or the ownership or disposition of the Bonds, except those specifically addressed herein. This opinion letter is issued as of the date hereof and we assume no obligation to revise or supplement this opinion letter to reflect any facts or circumstances that may hereafter come to our attention or any changes in law that may hereafter occur. Respectfully submitted,

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APPENDIX C INFORMATION CONCERNING THE DEPOSITORY TRUST COMPANY The information in this Appendix concerning DTC and DTC’s book entry only system has been obtained from sources that the City believes to be reliable, but the City takes no responsibility for the completeness or accuracy thereof. The following description of the procedures and recordkeeping with respect to beneficial ownership in the Bonds, payment of principal, premium, if any, and interest with respect to the Bonds to all DTC Participants or to Beneficial Owners, confirmation and transfers of Beneficial Ownership interests in the Bonds and other related transactions by and between DTC, DTC Participants and Beneficial Owners is based solely on information provided by DTC. DTC will act as securities depository for the Bonds. The Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Bond will be issued for each annual maturity of the Bonds, each in the aggregate principal amount of such maturity, and will be deposited through the facilities of DTC. DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of “AA+.” The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com. Purchases of Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Bonds on DTC’s records. The ownership interest of each actual purchaser of each Bond (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive Bonds representing their ownership interests in Bonds, except in the event that use of the book-entry system for the Bonds is discontinued.

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To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Bonds, such as prepayments, tenders, defaults, and proposed amendments to the Bond documents. For example, Beneficial Owners of Bonds may wish to ascertain that the nominee holding the Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. Redemption notices shall be sent to DTC. If less than all of the Bonds within a maturity are being prepaid, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such maturity to be redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Bonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). Redemption proceeds, distributions, and dividend payments on the Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the City or the Trustee, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, the Trustee, or the City, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is not the responsibility of the City or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. A Bond Owner shall give notice to elect to have its Bonds purchased or tendered, through its Participant, to the Trustee, and shall effect delivery of such Bonds by causing the Direct Participant to transfer the Participant’s interest in the Bonds, on DTC’s records, to the Trustee. The requirement for physical delivery of Bonds in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Bonds are transferred by Direct Participants on DTC’s records and followed by a book-entry credit of tendered Bonds to the Trustee’s DTC account.

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DTC may discontinue providing its services as depository with respect to the Bonds at any time by giving reasonable notice to the City or the Trustee. Under such circumstances, in the event that a successor depository is not obtained, physical certificates are required to be printed and delivered. The City may decide to discontinue use of the system of book-entry only transfers through DTC (or a successor securities depository). In that event, Bonds will be printed and delivered to DTC. THE TRUSTEE, AS LONG AS A BOOK-ENTRY ONLY SYSTEM IS USED FOR THE BONDS, WILL SEND ANY NOTICE OF REDEMPTION OR OTHER NOTICES TO OWNERS ONLY TO DTC. ANY FAILURE OF DTC TO ADVISE ANY DTC PARTICIPANT, OR OF ANY DTC PARTICIPANT TO NOTIFY ANY BENEFICIAL OWNER, OF ANY NOTICE AND ITS CONTENT OR EFFECT WILL NOT AFFECT THE VALIDITY OF SUFFICIENCY OF THE PROCEEDINGS RELATING TO THE REDEMPTION OF THE BONDS CALLED FOR REDEMPTION OR OF ANY OTHER ACTION PREMISED ON SUCH NOTICE.

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APPENDIX D FORM OF CITY CONTINUING DISCLOSURE CERTIFICATE City of Las Vegas, Nevada Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017 This Continuing Disclosure Certificate (the “Disclosure Certificate”) is executed and delivered by the City of Las Vegas, Nevada (the “City”) in connection with the issuance of its Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017, dated the date hereof, in the aggregate principal amount of $________ (the “Bonds”). The Bonds are being issued pursuant to a Trust Indenture, dated as of September 1, 2017 (the “Indenture”), between the City and The Bank of New York Mellon Trust Company, N.A. The City covenants and agrees as follows: SECTION 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the City for the benefit of the holders and beneficial owners of the Bonds and in order to assist the Participating Underwriter in complying with Rule 15c2-12(b)(5) of the Securities and Exchange Commission (the “SEC”). SECTION 2. Definitions. In addition to the definitions set forth in the Indenture or parenthetically defined herein, which apply to any capitalized terms used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: “Annual Report” means any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 hereof. “Dissemination Agent” means, initially, the City, or any successor Dissemination Agent designated in writing by the City and which has filed with the City a written acceptance of such designation. “Material Events” means any of the events listed in Section 5 hereof. “MSRB” means the Municipal Securities Rulemaking Board. As of the date hereof, the MSRB’s required method of filing is electronically via its Electronic Municipal Market Access (EMMA) system available on the Internet at http://emma.msrb.org. “Participating Underwriter” means the original underwriter of the Bonds required to comply with the Rule in connection with an offering of the Bonds. “Rule” means Rule 15c2-12(b)(5) adopted by the SEC under the Securities Exchange Act of 1934, as the same may be amended from time to time. SECTION 3.

Provision of Annual Reports.

A. The City shall, or shall cause the Dissemination Agent to, not later than nine (9) months following the end of the City’s fiscal year of each year, commencing nine (9) months following the end of the City’s fiscal year ending June 30, 2018, provide to the MSRB (in an electronic format as prescribed by the MSRB), an Annual Report which is consistent with the requirements of Section 4 hereof. Not later than five (5) business days prior to said date, the City shall provide the Annual Report to D-1

the Dissemination Agent (if other than the City). The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section 4 hereof; provided that the audited financial statements of the City may be submitted separately from the balance of the Annual Report. B. If the City is unable to provide to the MSRB an Annual Report by the date required in subsection (A), the City, in a timely manner, shall file or cause to be filed with the MSRB a notice in substantially the form attached as Exhibit A. C.

The Dissemination Agent shall:

(1) determine each year prior to the date for providing the Annual Report the appropriate electronic format prescribed by the MSRB; (2) if the Dissemination Agent is other than the City, send written notice to the City at least 45 days prior to the date the Annual Report is due stating that the Annual Report is due as provided in Section 3(A) hereof; and (3) if the Dissemination Agent is other than the City, file a report with the City certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided and listing all the entities to which it was provided. SECTION 4. Content of Annual Reports. The City’s Annual Report shall contain or incorporate by reference the following: A. A copy of its annual financial statements prepared in accordance with generally accepted accounting principles audited by a firm of certified public accountants. If audited annual financial statements are not available by the time specified in Section 3(A) above, unaudited financial statements will be provided as part of the Annual Report and audited financial statements will be provided when and if available. B.

An update of the type of information identified in Exhibit B hereto.

Any or all of the items listed above may be incorporated by reference from other documents, including official statements of debt issues of the City or related public entities, which are available to the public on the MSRB’s Internet Web Site or filed with the SEC. The City shall clearly identify each such document incorporated by reference. SECTION 5. Reporting of Material Events. The City shall file or cause to be filed with the MSRB, in a timely manner not in excess of ten business days after the occurrence of the event, notice of any of the events listed below with respect to the Bonds: A.

Principal and interest payment delinquencies;

B.

Non-payment related defaults, if material;

C.

Unscheduled draws on debt service reserves reflecting financial difficulties;

D.

Unscheduled draws on credit enhancements reflecting financial difficulties;

E.

Substitution of credit or liquidity providers or their failure to perform; D-2

F. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds; G.

Modifications to rights of bondholders, if material;

H.

Bond calls, if material, and tender offers;

I.

Defeasances;

J.

Release, substitution or sale of property securing repayment of the Bonds, if

K.

Rating changes;

L.

Bankruptcy, insolvency, receivership or similar event of the obligated person;1

material;

M. The consummation of a merger, consolidation, or acquisition involving an obligated person or the sale of all or substantially all of the assets of the obligated person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and N. Appointment of a successor or additional trustee or the change of name of a trustee, if material. SECTION 6. Format; Identifying Information. All documents provided to the MSRB pursuant to this Disclosure Certificate shall be in the format prescribed by the MSRB and accompanied by identifying information as prescribed by the MSRB. As of the date of this Disclosure Certificate, all documents submitted to the MSRB must be in portable document format (PDF) files configured to permit documents to be saved, viewed, printed and retransmitted by electronic means. In addition, such PDF files must be word-searchable, provided that diagrams, images and other non-textual elements are not required to be word-searchable. SECTION 7. Termination of Reporting Obligation. The City’s obligations under this Disclosure Certificate shall terminate upon the earliest of: (A) the date of legal defeasance, prior redemption or payment in full of all of the Bonds; (B) the date that the City shall no longer constitute an “obligated person” within the meaning of the Rule; or (C) the date on which those portions of the Rule which require this written undertaking are held to be invalid by a court of competent jurisdiction in a nonappealable action, have been repealed retroactively or otherwise do not apply to the Bonds.

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For the purposes of the event identified in subparagraph (b)(5)(i)(C)(12) of the Rule, the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for an obligated person 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 obligated person, or if such jurisdiction has been assumed by leaving the existing governing body and official 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 obligated person.

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SECTION 8. Dissemination Agent. The City may, from time to time, appoint or engage a Dissemination Agent to assist the City in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. SECTION 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the City may amend this Disclosure Certificate and may waive any provision of this Disclosure Certificate, without the consent of the holders and beneficial owners of the Bonds, if such amendment or waiver does not, in and of itself, cause the undertakings herein (or action of any Participating Underwriter in reliance on the undertakings herein) to violate the Rule, but taking into account any subsequent change in or official interpretation of the Rule. The City will provide notice of such amendment or waiver to the MSRB. SECTION 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Material Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Material Event in addition to that which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Material Event. SECTION 11. Default. In the event of a failure of the City to comply with any provision of this Disclosure Certificate, any holder or beneficial owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an event of default under the Indenture, and the sole remedy under this Disclosure Certificate in the event of any failure of the City to comply with this Disclosure Certificate shall be an action to compel performance. SECTION 12. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Dissemination Agent, the Participating Underwriter and the holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity. DATE: September __, 2017. CITY OF LAS VEGAS, NEVADA

By: Mayor

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EXHIBIT A NOTICE OF FAILURE TO FILE ANNUAL REPORT Name of Issuer: City of Las Vegas, Nevada Name of Bond Issue: Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017, dated September __, 2017, in the aggregate principal amount of $_________. CUSIP: Date of Issuance:

September __, 2017.

NOTICE IS HEREBY GIVEN that the City has not provided an Annual Report with respect to the abovenamed Bonds as required by Section 8.07 of the Trust Indenture, dated as of September 1, 2017, between the City and The Bank of New York Mellon Trust Company, N.A., and the Continuing Disclosure Certificate executed on September __, 2017, by the City. The City anticipates that the Annual Report will be filed by ______________________. Dated: ______________, _____ CITY OF LAS VEGAS, NEVADA

By: Its:

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EXHIBIT B INFORMATION TO BE UPDATED 1. The principal amount of the Bonds outstanding and the balances on deposit in the Bond Fund, the Reserve Fund, and the Construction Fund. 2. The percentage of the Assessment Installments levied that were collected in the Fiscal Year in question and: (a) With respect to Assessment Installments that are more than 90 days delinquent, the amount of each delinquency, the length of time delinquent and the date on which foreclosure or sale proceedings were commenced, or similar information pertaining to delinquencies deemed appropriate by the City, provided, however, that parcels with delinquencies of $1,000 or less may be grouped together and such information may be provided by category; (b) The status of sale or foreclosure proceedings related to property within the District with one or more delinquent Assessment Installments and a summary of the results of any sales; and (c) To the extent not prohibited by law, the identity of any owner (as shown in the records of the Clark County Assessor or as otherwise known to the City) who is delinquent in payment of Assessments which represent more than 5% of the total outstanding Assessments. 3. To the extent not prohibited by law, a land ownership summary listing property owners (as shown in the records of the Clark County Assessor or as otherwise known to the City) responsible for more than 10% of the outstanding Assessments. 4. The number of parcels within the District, the number of such parcels with improvements thereon, the total “Assessor’s Taxable Value” of the parcels and the total “Assessor’s Taxable Value” of the improvements thereon (all as shown in the records of the Clark County Assessor) and the total amount of the unpaid Assessments.

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APPENDIX E FORM OF DEVELOPER CONTINUING DISCLOSURE UNDERTAKING THIS DEVELOPER CONTINUING DISCLOSURE UNDERTAKING (this “Disclosure Undertaking”), dated as of September 1, 2017, is executed and delivered by KAG Development West LLC (the “Developer”) in connection with the issuance of the $__________ City of Las Vegas, Nevada, Special Improvement District No. 609 (Skye Canyon) Local Improvement Bonds, Series 2017 (the “Bonds”). W I T N E S S E T H: WHEREAS, the Bonds are being issued pursuant to a Trust Indenture, dated as of September 1, 2017 (the “Indenture”), by and between the City and The Bank of New York Mellon Trust Company, N.A., as trustee; WHEREAS, the Bonds are payable from and secured by assessments levied on certain of the property within City of Las Vegas, Nevada, Special Improvement District No. 609 (Skye Canyon) (the “District”); WHEREAS, the Developer owns certain of the property within the District and this Disclosure Undertaking is being executed and delivered by the Developer and the Dissemination Agent (as defined below) to provide updated information with respect to the development within the District; NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the parties hereto agree as follows: Section 1. Definitions. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Indenture. In addition, the following capitalized terms shall have the following meanings: “Affiliate” of another Person means (a) a Person directly or indirectly owning, controlling, or holding with power to vote, 5% or more of the outstanding voting securities of such other Person, (b) any Person 5% or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by such other Person, and (c) any Person directly or indirectly controlling, controlled by, or under common control with, such other Person; for purposes hereof, control means the power to exercise a controlling influence over the management or policies of a Person, unless such power is solely the result of an official position with such Person. “Semi-Annual Report” means any semi-annual report provided by the Developer pursuant to, and as described in, Section 3 hereof. “Semi-Annual Report Date” means June 1 and December 1 in each year. “Bond Counsel” means an attorney or a firm of attorneys whose experience in matters relating to the issuance of obligations by the states and their political subdivisions and the tax-exempt status of the interest thereon is recognized nationally. “Developer” means KAG Development West LLC, and its successors and assigns.

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“Developer Property” means the Property owned by the Developer within the District. “Dissemination Agent” means Zions Public Finance, or any successor Dissemination Agent designated in writing by the Developer and which has filed with the City a written acceptance of such designation. “EMMA” means the Electronic Municipal Market Access system of the MSRB. “Event of Bankruptcy” means, with respect to a Person, that such Person files a petition or institutes a proceeding under any act or acts, state or federal, dealing with or relating to the subject or subjects of bankruptcy or insolvency, or under any amendment of such act or acts, either as a bankrupt or as an insolvent, or as a debtor, or in any similar capacity, wherein or whereby such Person asks or seeks or prays to be adjudicated as bankrupt, or is to be discharged from any or all of such Person’s debts or obligations, or offers to such Person’s creditors to effect a composition or extension of time to pay such Person’s debts or asks, seeks or prays for reorganization or to effect a plan of reorganization, or for a readjustment of such Person’s debts, or for any other similar relief, or if any such petition or any such proceedings of the same or similar kind or character is filed or instituted or taken against such Person, or if a receiver of the business or of the property or assets of such Person is appointed by any court, or if such Person makes a general assignment for the benefit of such Person’s creditors. “Listed Events” means any of the events listed in Section 4(a) hereof. “MSRB” means the Municipal Securities Rulemaking Board and any successor entity designated under the Rule as the repository for filings made pursuant to the Rule. “Official Statement” means the Official Statement dated September __, 2017, relating to the Bonds. “Participating Underwriter” means any of the original underwriters of the Bonds required to comply with the Rule in connection with offering of the Bonds. “Person” means an individual, a corporation, a partnership, a limited liability company, an association, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof. “Property” means the real property within the boundaries of the District that is not exempt from real property taxes. “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. Section 2. Provision of Semi-Annual Reports. (a) The Developer shall provide, or cause to be provided, to the MSRB a Semi-Annual Report which is consistent with the requirements of Section 3 hereof, not later than each Semi-Annual Report Date, commencing with the Semi-Annual Report due on June 1, 2018. The Semi-Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 3 hereof. (b) Not later than 60 days prior to each Semi-Annual Report Date, the Dissemination Agent shall send written notice to the Developer notifying the Developer that a Semi-Annual Report must be delivered to the Dissemination Agent no later than 15 days prior to such Semi-Annual Report Date. Not later than 15 days prior to the Semi-Annual Report Date, the Developer shall provide the Semi-Annual

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Report to the Dissemination Agent. If by such date, the Dissemination Agent has not received a copy of the Semi-Annual Report, the Dissemination Agent shall contact the Developer and inform them that such Semi-Annual Report has not been received. This Section (2)(b) shall not be applicable so long as the Developer is serving as Dissemination Agent. (c) The Developer shall, or, upon receipt of such Semi-Annual Report by the Dissemination Agent, the Dissemination Agent shall, provide to the MSRB through the EMMA system a Semi-Annual Report which is consistent with the requirements of Section 3 below, not later than each Semi-Annual Report Date, commencing with the Semi-Annual Report that is due on June 1, 2018. (d) If the Dissemination Agent is unable to verify that a Semi-Annual Report has been provided to the MSRB and each Participating Underwriter by the date required in subsection (a), the Dissemination Agent shall send a notice to the MSRB and the Participating Underwriters in the form required by the MSRB. (e)

The Dissemination Agent shall: (i)

confirm the electronic filing requirements of the MSRB for the Semi-Annual

Reports; and; (ii) promptly after receipt of the Semi-Annual Report, file a report with the City certifying that the Semi-Annual Report has been provided pursuant to this Disclosure Undertaking, stating the date it was provided the MSRB. Section 3. Semi-Annual Reports. Each Semi-Annual Report shall contain or incorporate by reference the following information: (a) With respect to the Semi-Annual Report due on June 1 only, the financial statements of the Developer for the prior fiscal year. If financial statements are not available by the time the SemiAnnual Report is required to be filed pursuant to Section 2(a), the Financial Statements shall be filed in the same manner as the Semi-Annual Report when they become available. (b) An update since the date of the prior Semi-Annual Report of the number of building permits issued and sales of Developer Property (which may be included in the update to Table 1 pursuant to Section 3(d)(ii) below) within the District. (c) A statement as to whether or not the Developer paid, prior to their becoming delinquent, all Assessment Installments or property taxes levied on the Developer Property payable during the period since the last Semi-Annual Report, and if the Developer is delinquent in the payment of such Assessment Installments or property taxes, a statement specifying the amount of each such delinquency and describing any plans to resolve such delinquency. (d) An update, if any, to the information set forth in the Official Statement under the captions: (i) “THE DISTRICT  The Developer and Contracted Project Manager”; (ii) THE DISTRICT  The Development Plan” (including Tables 1 and 2 thereunder); and (iii) “THE DEVELOPER’S FINANCING PLAN” (including Table 3 thereunder). (e) In addition to any of the information expressly required to be provided pursuant to paragraphs (a), (b), (c) and (d) of this Section, the Developer shall provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

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Section 4. Reporting of Significant Events. (a) Pursuant to the provisions of this Section, the Developer shall promptly give, or cause to be given, notice of the occurrence of any of the following events: (i) Any denial or termination of credit, any denial or termination of, or default under, any line of credit or loan or any other loss of a source of funds that could have a material adverse effect on the ability of the Developer, or any Affiliate of the Developer, to construct the public improvements necessary to complete development of the Developer Property, to construct planned residential units on the Developer Property, or to pay Assessment Installments when due. (ii) The occurrence of an Event of Bankruptcy with respect to the Developer, or any Affiliate of the Developer, that could have a material adverse effect on the ability of the Developer, or any Affiliate of the Developer, to complete the public improvements set forth in Table 2 of the Official Statement or to pay Assessment Installments when due. (iii)

Any amendments to land use entitlements for the Developer’s Property, if

material. (iv) Any previously undisclosed governmentally-imposed preconditions commencement or continuation of development on the Developer’s Property, if material.

to

(v) Any previously undisclosed legislative, administrative or judicial challenges to development on the Developer’s Property, if material. (b) Whenever the Developer obtains knowledge of the occurrence of a Listed Event, the Developer shall promptly notify the Dissemination Agent in writing (if the Developer is not the Dissemination Agent). Such notice shall instruct the Dissemination Agent to report the occurrence pursuant to subsection (c). (c) If the Dissemination Agent has been instructed by the Developer (if the Developer is not the Dissemination Agent) to report the occurrence of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with the MSRB. If the Developer is the Dissemination Agent, the Developer shall file such notice. Section 5. Termination of Reporting Obligation. All of the Developer’s obligations hereunder shall terminate upon the earlier of: (a) the legal defeasance, prior redemption or payment in full of all the Bonds and (b) that point at which the unbilled Assessments associated with the Developer Property is less than 20% of the total unbilled Assessments within the District. Upon the occurrence of any such termination prior to the final maturity of the Bonds, the Developer shall give notice of such termination in the same manner as for a Listed Event under Section 4 hereof. Section 6. Dissemination Agent. The Developer may, from time to time, appoint or engage a separate Dissemination Agent to assist it in carrying out its obligations under this Disclosure Undertaking, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. At any time that there is not any other designated Dissemination Agent, the Developer shall continue to be responsible for the filings hereunder. The Developer shall be responsible for paying the fees and expense of the Dissemination Agent under this Disclosure Undertaking. Section 7. Amendment; Waiver. Notwithstanding any other provision hereof, the Developer and the Dissemination Agent (if the Developer is not the Dissemination Agent) may amend this Disclosure Undertaking (and the Dissemination Agent shall agree to any amendment requested by the

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Developer), and any provision hereof may be waived, provided that the proposed amendment or waiver either (i) is approved by holders of the Bonds in the manner provided in the Indenture for amendments to the Indenture with the consent of holders, or (ii) does not, in the opinion of Bond Counsel approved by the City, materially impair the interests of the holders or beneficial owners of the Bonds. If the financial information or operating data to be provided in the Semi-Annual Report is amended pursuant to the provisions hereof, the first financial information thereafter filed pursuant hereto containing the amended operating data or financial information shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided. Section 8. Additional Information. Nothing in this Disclosure Undertaking shall be deemed to prevent the Developer from disseminating any other information using the means of dissemination set forth in this Disclosure Undertaking or any other means of communication, or including any other information in any Semi-Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Undertaking. If the Developer chooses to include any information in any Semi-Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Undertaking, the Developer shall have no obligation under this Disclosure Undertaking to update such information or include it in any future Semi-Annual Report or notice of occurrence of a Listed Event. Section 9. Default. In the event of a failure of the Developer to comply with any provision of this Disclosure Undertaking, the Dissemination Agent may (if the Developer is not the Dissemination Agent) (and, at the written direction of any Participating Underwriter or the holders of at least 25% aggregate principal amount of Outstanding Bonds, shall), or any holder or beneficial owner of the Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Developer or the Dissemination Agent, as the case may be, to comply with its obligations under this Disclosure Undertaking. A default under this Disclosure Undertaking shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Undertaking in the event of any failure of the Developer or the Dissemination Agent to comply with this Disclosure Undertaking shall be an action to compel performance. Section 10. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent (if the Developer is not the Dissemination Agent) shall not have any responsibility for the content of any Semi-Annual Report. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Undertaking, and the Developer agrees to indemnify and save the Dissemination Agent (if the Developer is not the Dissemination Agent), its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including reasonable attorneys’ fees) of defending against any claim of liability, but excluding liabilities due to such Dissemination Agent’s negligence or willful misconduct. The obligations of the Developer under this Section shall survive resignation or removal of such Dissemination Agent and payment of the Bonds. Section 11. Beneficiaries. This Disclosure Undertaking shall inure solely to the benefit of the City, the Developer, the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity.

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IN WITNESS WHEREOF, the Developer has executed this Disclosure Undertaking as of the date first written above. KAG DEVELOPMENT WEST, LLC By:

____________________________________

Name: ____________________________________ Title:

_____________________________________

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APPENDIX F THE APPRAISAL

[THIS PAGE INTENTIONALLY LEFT BLANK]

MARKET VALUE APPRAISAL OF SPECIAL IMPROVEMENT DISTRICT NO. 609 LOCATED IN SKYE CANYON PHASE 2 CRA File No. 70731 Date of As-Is Market Value: August 1, 2017 Date of Report/Transmittal: August 17, 2017 PREPARED FOR Ms. Lorrie Linnert-Dunford, Egr. Project Manager Ms. Alisha Auch, P.E., Project Engineer City of Las Vegas | Dept. of Public Works City Engineering Division Development Service Center (DSC) 9th Floor 333 North Rancho Dr., Las Vegas, Nevada 89106

PREPARED BY Continental Realty Advisors Valuation Services Group www.cravaluation.com Corporate Headquarters 4 Venture, Suite 235 Irvine, California, 92618 Ph: 949.221.0975 / Fax: 949.221.0973

REGIONAL OFFICES Bakersfield: 1430 Truxtun Avenue, 5th Floor, Bakersfield, CA 93301 | T: (661) 270-2237 Las Vegas: 3651 Lindell Road, Suite D, Las Vegas, NV 89103 | T: (702) 965-2097 Phoenix: 2942 N 24th Street, Suite 114, Phoenix, AZ 85016 | T: (480) 237-9780 San Diego: 2534 State Street, San Diego, CA 92101 | T: (619) 569-2727 San Francisco: 388 Market Street, Ste.1300, San Francisco, CA 94111 | T: (415) 367-9753 Seattle: 1001 4th Avenue, Suite 3200, Seattle, WA 98154 | T: (206) 267-2401 Copyright 2017

Continental Realty Advisors 4 Venture, Suite 235 Irvine, CA 92618 Phone: (949)221-0975 Fax: (949)221-0973

August 17, 2017 CRA File No. 70731 Lorrie Linnert-Dunford Engineering Project Manager Department of Public Works City Engineering Division Development Services Center (DSC) 9th Floor 333 N Rancho Dr. Las Vegas, Nevada 89106 Ms. Alisha Auch, P.E. Project Engineer Department of Public Works City Engineering Division Development Services Center (DSC) 9th Floor 333 N Rancho Dr. Las Vegas, Nevada 89106 Re:

Market Value Appraisal for a Special Improvement Bond Issue (SID No. 609) Benefiting Skye Canyon Phase 2, Located in the Northwesterly Portion of Metropolitan Las Vegas, Nevada

Dear Ms. Linnert-Dunford and Ms. Auch: As requested, we have inspected and appraised the above referenced property for the purpose of estimating the market value of the fee simple interest as defined in the accompanying report. This report has been prepared in accordance with the Uniform Standards of Professional Appraisal Practice; the Code of Ethics and Standards of Professional Practice of the Appraisal Institute, This report is intended to comply with the reporting requirements set forth under Standards Rule 2-2(a) of the Uniform Standards of Professional Appraisal Practice for an Appraisal Report; however the level of discussion, as agreed upon with our client, is consistent with the historic definition of a Summary Appraisal Report (Standards Rule 2-2(b) of the 2012-13 USPAP). As such, it presents only summary discussions of the data, reasoning and analyses used in the appraisal process to develop the appraisers’ opinions of value. The depth of discussion contained in this report is specific to the needs of the client and for the intended use stated below.

Irvine: (Corporate Headquarters) 4 Venture, Suite 235, Irvine, CA 92618 | T: (949) 221-0975 F: (949) 221-0973 Bakersfield: 1430 Truxtun Avenue, 5th Floor, Bakersfield, CA 93301 | T: (661) 270-2237 Las Vegas: 3651 Lindell Road, Suite D, Las Vegas, NV 89103 | T: (702) 965-2097 Phoenix: 2942 N 24th Street, Suite 114, Phoenix, AZ 85016 | T: (480) 237-9780 San Diego: 2534 State Street, San Diego, CA 92101 | T: (619) 569-2727 San Francisco: 388 Market Street, Ste.1300, San Francisco, CA 94111 | T: (415) 367-9753 Seattle: 1001 4th Avenue, Suite 3200, Seattle, WA 98154 | T: (206) 267-2401

Ms. Linnert-Dunford / Ms. Auch Transmittal Letter

August 17, 2017 Page Two

The intended use of the appraisal is to provide a present market value estimate of the subject property for use in connection with an official statement for the issuance of bonds for the above-stated Special Improvement District. We have also been asked to estimate the bulk value of the entire site assuming a sale of the site in its current partially-improved condition under the premise that subject does not have the benefit of the development and marketing programs in-place or the planned infrastructure improvements, including those to be funded by the subject Special Improvement District. As a result of our investigation and analysis, the estimated as-is market value of the subject property based on an analysis completed as of August 1, 2017 is: AS-IS FEE SIMPLE MARKET VALUE As of August 1, 2017 FORTY ONE MILLION TWO HUNDRED FORTY THOUSAND DOLLARS $41,240,000 Exposure Period Based upon our market investigations, a reasonable exposure period (time on market ‘prior to’ date of value) is six to 12 months, with nine months most probable. The following narrative report outlines our data, analyses and conclusions. Additional material relied upon is retained in the work paper files and available upon written request. Thank you for the opportunity to be of service in this matter. If we can be of further assistance, please contact us at your convenience. Respectfully submitted, Continental Realty Advisors-VSG

Bradley J. Holtz, MAI, ASA Executive Vice-President/Senior Managing Director NV Cert. A.0000519-CG / Exp’n 12-31-2017 562.773.0390 / [email protected]

S.Kerhart ASA, CCIM, CPA, MRICS, MAI, MCR Executive Vice-President / Chief Valuation Officer (CVO) NV Cert. A.0205879-CG / Exp’n 12-31-2017 949.221.0967 / [email protected]

TABLE OF CONTENTS EXECUTIVE SUMMARY ............................................................................................................................... I  SUMMARY OF METHODOLOGY ................................................................................................................ II  VALUATION SUMMARY AND CONCLUSIONS ........................................................................................ III  CERTIFICATION ......................................................................................................................................... IV  SPECIAL ASSUMPTIONS ........................................................................................................................... V  GENERAL ASSUMPTIONS AND LIMITING CONDITIONS ....................................................................... V  INTRODUCTION........................................................................................................................................... 1  PURPOSE AND DATE OF THE APPRAISAL ........................................................................................................... 1  INTENDED USE OF THE APPRAISAL ................................................................................................................... 1  EXTENT OF DATA COLLECTION ......................................................................................................................... 1  APPRAISAL DEVELOPMENT AND REPORTING PROCESS ...................................................................................... 1  USPAP COMPETENCY PROVISION ................................................................................................................... 2  PROPERTY RIGHTS APPRAISED ........................................................................................................................ 2  DEFINITION OF MARKET VALUE ........................................................................................................................ 2  AS-IS PREMISE................................................................................................................................................ 3  BULK ACREAGE VALUE .................................................................................................................................... 3  SUBJECT PROPERTY................................................................................................................................. 4  LOCATION ....................................................................................................................................................... 4  LEGAL DESCRIPTION........................................................................................................................................ 4  AREA ANALYSIS ......................................................................................................................................... 7  INTRODUCTION ................................................................................................................................................ 7  REGIONAL DESCRIPTION .................................................................................................................................. 7  RESIDENTIAL MARKET OVERVIEW ....................................................................................................... 12  CONCLUSION................................................................................................................................................. 15  DESCRIPTION OF THE SITE .................................................................................................................... 18  LOCATION ..................................................................................................................................................... 18  CONFIGURATION/SIZE .................................................................................................................................... 18  TOPOGRAPHY AND SITE CONDITIONS.............................................................................................................. 19  SOIL CONDITIONS / ENVIRONMENTAL .............................................................................................................. 19  ACCESS AND EXPOSURE ................................................................................................................................ 19  ZONING ......................................................................................................................................................... 19  UTILITIES ...................................................................................................................................................... 20  STORM DRAINAGE ......................................................................................................................................... 20  EASEMENTS .................................................................................................................................................. 20  CONCLUSION................................................................................................................................................. 20  PROPOSED DEVELOPMENT PLAN ........................................................................................................ 21  TAX ANALYSIS .......................................................................................................................................... 23  HISTORY OF THE SUBJECT PROPERTY ............................................................................................... 24 

HIGHEST AND BEST USE ........................................................................................................................ 25  HIGHEST AND BEST USE OF THE SITE AS VACANT ........................................................................... 26  HIGHEST AND BEST USE AS PROPOSED ............................................................................................. 27  APPRAISAL PROCESS & METHODOLOGY ........................................................................................... 28  DEVELOPMENT APPROACH ................................................................................................................... 30  SINGLE FAMILY - LAS VEGAS VALLEY LAND SALES .......................................................................................... 30  Single Family Land Sales Analysis......................................................................................................... 32  SINGLE FAMILY RESIDUAL ANALYSES ............................................................................................................. 33  ABSORPTION OF VACANT LAND ...................................................................................................................... 38  DEVELOPMENT COSTS ................................................................................................................................... 40  DISCOUNT RATE ............................................................................................................................................ 41  CONCLUSION................................................................................................................................................. 42  VALUATION SUMMARY AND CONCLUSIONS ....................................................................................... 44  EXPOSURE TIME – DEVELOPMENT ANALYSIS .................................................................................................. 44  CONCLUSION OF ‘AS IS’ BULK ACREAGE VALUE .............................................................................. 45  EXPOSURE TIME – BULK VALUE ANALYSIS ...................................................................................................... 47  ADDENDA .................................................................................................................................................. 48 

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Executive Summary

EXECUTIVE SUMMARY PROPERTY NAME:

Special Improvement District No. 609 Serving Skye Canyon Phase 2

PROPERTY TYPE:

Master-planned community containing single family residential, with ancillary public uses.

LOCATION:

Northwestern Las Vegas Valley, in the city of Las Vegas, Nevada

DATE OF VALUATION:

August 1, 2017

DATE OF REPORT:

August 17, 2017

ACREAGE:

The net assessable acreage for Skye Canyon Phase 2 is 218.48 which comprises the acreage determined to be salable and assessable within SID 609. As of the date of value, Skye Canyon is in the early stages of active development with three builder parcels having already been sold (closings pending). A brief summary of the appraised acreage is illustrated in the following table. LAND USE

ACREAGE

SID No. 609 Skye Canyon Phase 2 Assessed Acreage: Residential MFR/Commercial - TBD Subtotal – SID No. 609: (under appraisal) Total Net Appraised Acreage for SID No. 609:

213.00 5.48 218.48

218.48

SITE DESCRIPTION:

Irregular shaped parcels of generally contiguous sites.

INTEREST APPRAISED:

Fee simple interest

HIGHEST AND BEST USE: VACANT / PROPOSED (BOTH): Planned residential community

Continental Realty Advisors: Full Service Real Estate Appraisal & Consulting (949) 221-0975

Summary of Methodology

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SUMMARY OF METHODOLOGY We have used the Development Approach to value the subject property. The Development Approach is the process in which the anticipated flow of future benefits (dollar income or amenities) is discounted to a present worth figure through a capitalization or direct discount procedure. All expenses attributable to the real estate are deducted from an effective gross income estimate to arrive at forecasts of applicable net income streams. The net income streams are then "capitalized" or discounted into value at market derived rates. In a land development project, the effective gross income is derived from the sale of land parcels to other developers and builders. Elements of the direct sales comparison approach were used to gather comparable sales of properties that have similar land uses as the subject. Rather than valuing the subject as one contiguous 218.48 acre parcel, we have broken it up into various land use categories, largely varied by density and anticipated finished home price points, and have prepared an analysis of each individual land use and product type. A search of the market revealed the sales most comparable to the subject. Given the price trends throughout the greater Las Vegas Valley and the varied densities and price points for the homes proposed for the subject, land sales data alone was not adequate to price the subject acreage. Given this, we also prepared land residual analyses for each parcel based upon end-product characterizations prepared by both the developer and the RCG Economics. Information relating to end product type, unit densities, sizes and pricing were used in order to estimate a reasonable residual to the land for each parcel. Drawing from both the comparable sales data and the residual analyses, benchmark values were then applied to the key components presented in the Skye Canyon masterplan. Individual parcels of land were valued by multiplying the benchmark value per acre by the size of the individual parcel. The sum of the individual values reflects the hypothetical aggregate retail proceeds. For purposes of the developmental model, the acreage pricing was averaged by product type in order to avoid front- or back-loading of premiums for higher-priced parcels. These values were then inflated to a future value that reflected the market appreciation for that type of land use in the Las Vegas area. All periodic revenues were inflated at 3.0 percent per year based on long-term inflation rates. We estimated the period in which each portion of the subject would be sold by performing absorption analyses. As detailed later herein, reliance has been placed on third-party reports in this effort, particularly the market/absorption study prepared RCG Economics. The future market value was inflated to the point at which the parcel is projected to be sold (for analytic purposes), then discounted back to a present value using a discount rate of 16.0 percent.

Continental Realty Advisors: Full Service Real Estate Appraisal & Consulting (949) 221-0975

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Valuation Summary and Conclusion

VALUATION SUMMARY AND CONCLUSIONS Our value conclusions were derived by performing a development approach for the property that included aspects of the income, market and cost approaches to value. We researched and analyzed a variety of different land uses that are contained within the subject Special Improvement District and found comparable land sales that we believe are representative of the market value of land parcels similar to those contained in the subject property. We then utilized a discounted cash flow model, estimating the absorption period of the individual land parcels as well as the entire project and discounted the value back to present dollars. Based on the methodology and assumptions explained in this report, it is our opinion that the market value of the subject property based on analyses completed as of August 1, 2017: ESTIMATED MARKET VALUE:

$41,240,000

In addition to our estimate of the as-is market value for the subject property, we have also estimated the value of the site in its ‘as is’ partially-improved bulk acreage state. In this case, our value assumes that the value of the subject is based on a single purchase of the entire site with the currently existing on- and offsite improvements in-place. This valuation does not consider the development and marketing programs in-place or the planned infrastructure improvements, including those to be funded by the subject Special Improvement District. Based on our analysis, we have concluded that the ‘as is’ bulk value for the subject, as of August 1, 2017 is: ESTIMATED ‘AS IS’ BULK ACREAGE VALUE:

$32,770,000

Continental Realty Advisors: Full Service Real Estate Appraisal & Consulting (949) 221-0975

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Certification

CERTIFICATION We certify that, to the best of our knowledge and belief: 

The statements of fact contained in this report are true and correct.



We have performed no services as an appraiser or in any other capacity regarding the property that is the subject of this report within the three-year period immediately preceding acceptance of this assignment.



The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions, and is our personal, unbiased professional analyses, opinions, and conclusions.



We have no present or prospective interest in the property that is the subject of this report, and we have no personal interest or bias with respect to the parties involved.



We have the knowledge and experience to complete this appraisal assignment and have appraised this property type before.



Our compensation is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event.



The analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice.



The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.



The appraisal assignment was not based on a requested minimum valuation, a specific valuation, or the approval of the loan.



Neither we, nor our current employer, have been sued by a regulatory agency or financial institution for fraud or negligence involving an appraisal report.



Bradley J. Holtz, MAI, ASA has inspected the subject property. Steve Kerhart did not inspect the subject property. Mr. Kerhart reviewed the report.



The reported analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute.



As of the date of this report, Steven C. Kerhart, MAI, ASA, CCIM, has completed the requirements of the continuing education program of the Appraisal Institute. Steve Kerhart has completed the continuing education requirements of the American Society of Appraisers and the Commercial Investment of Real Estate Institute. As of the date of this report, Bradley J. Holtz, MAI, ASA has completed the requirements of the continuing education program of the Appraisal Institute and the American Society of Appraisers.

Respectfully submitted,

Bradley J. Holtz, MAI, ASA Executive Vice-President/Senior Managing Director

NV Cert. A.0000519-CG / Exp’n 12-31-2017 562.773.0390 / [email protected]

S. Kerhart ASA, CCIM, CPA, MRICS, MAI, MCR Executive Vice-President / Chief Valuation Officer (CVO)

NV Cert. A.0205879-CG / Exp’n 12-31-2017 949.221.0967 / [email protected]

Continental Realty Advisors: Full Service Real Estate Appraisal & Consulting (949) 221-0975

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SPECIAL ASSUMPTIONS This appraisal report is subject to the following special assumptions: 1. The land contained within the Special Improvement District falls within the zoning jurisdiction of the city of Las Vegas. Specific plans have been, and will continue to be, submitted for the subject as end-product specifications are finalized. It is a special assumption of this appraisal that the ultimate property uses (in terms of unit densities, price points, etc.) conform to the overall project as described herein. 2. In the conduct of this appraisal assignment we were provided, and have relied upon, absorption and market analyses prepared by RCG Economics. Although we have reviewed the report, comprised of findings and related addenda items, and generally concur with the conclusions, we do not warrant the accuracy of the data and analyses performed by third parties. 3. This appraisal addresses the assessable acreage within SID No. 609. In addition there are non-assessed areas totaling nearly 43 acres dedicated for streets, parks, arroyos, trails, open spaces, community center, and other non-assessable uses. Included in the non-assessable acres is parcel 2.13, Skye Canyon Park, a fully developed community, fitness center and park, available (subject to applicable rules and regulations) for the benefit of all Skye Canyon master planned residents. Also to be included within the SID, but not assessed, is Assessor Parcel 126-12-411-001 which totals 443.88 acres extending north and northwest of Skye Canyon. This parcel incorporates portions of the subject Parcels 2.17 and 2.20. The final mapping of these two parcels is contingent on the City of Las Vegas obtaining right of way grants from the BLM to re-align a portion of a future limited access freeway (Sheep Mountain Parkway). The City of Las Vegas formally applied for the right of way grants from the BLM in April 2017. Developer and the City of Las Vegas expect approval of the right of way grant in the first quarter of 2018. Hence, the ‘gross’ acreage within the subject SID will be just over 649 acres, however, much of this area will not be assessed and we understand the portions of APN 126-12-411-001 not dedicated to Parcels 2.17 and 2.20 may be extracted from the SID once the right of way adjustment has been completed. This appraisal assumes the right of way will be addressed in a timely manner and that all assessed parcels will be available for sale as estimated herein.

GENERAL ASSUMPTIONS AND LIMITING CONDITIONS In compliance with Uniform Standards of Professional Appraisal Practice, and to assist the reader in interpreting this report, the analyses and opinions set forth in this appraisal are subject to the following assumptions and limiting conditions. The conclusions and opinions expressed in this report apply to the date of value set forth in the letter of transmittal accompanying this report. The dollar amount of any value opinion or conclusion rendered or expressed in this report is based upon the purchasing power of the American dollar existing on the date of value. The appraiser assumes no responsibility for economic, physical or demographic factors, which may affect or alter the opinions in this report if said economic, physical or demographic factors were not present as of the date of the letter of transmittal accompanying this report. The appraiser is not obligated to predict future political, economic or social trends.

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In preparing this report, the appraiser was required to rely on information furnished by other individuals or found in previously existing records and/or documents. Unless otherwise indicated, such information is presumed to be reliable. However, no warranty, either expressed or implied, is given by the appraiser for the accuracy of such information and the appraiser assumes no responsibility for information relied upon later found to have been inaccurate. The appraiser reserves the right to make such adjustments to the analyses, opinions and conclusions set forth in this report as may be required by consideration of additional data or more reliable data that may become available. No opinion as to the title of the subject property is rendered. Data related to ownership and legal description were obtained from a recent title report and/or public records. However, title is assumed marketable, free, and clear of all liens, encumbrances, easements and restrictions except those specifically discussed in the report. The property is appraised assuming it to be under responsible ownership and competent management, and available for its highest and best use. The appraiser assumes no responsibility for hidden or unapparent conditions of the property, subsoil, groundwater or structures that render the subject property more or less valuable. No responsibility is assumed for arranging for engineering, geologic or environmental studies that may be required to discover such hidden or unapparent conditions. Unless otherwise stated in the report, the appraiser did not become aware of the presence of any such toxic or hazardous material or substance during the appraiser's inspection of the subject property. However, the appraiser is not qualified to investigate or test for the presence of such materials or substances. The presence of such materials or substances may adversely affect the value of the subject property. The value estimated in this report is predicated on the assumption that no such material or substance is present on or in the subject property or in such proximity, thereto that it would cause a loss in value. The appraiser assumes no responsibility for the presence of any such substance or material on or in the subject property, nor for any expertise or engineering knowledge required to discover the presence of such substance or material. Unless otherwise stated, this report assumes the subject property complies with all federal, state and local environmental laws, regulations and rules. Unless otherwise stated, the subject is appraised assuming it to be in full compliance with all applicable zoning and land use regulations and restrictions. Unless otherwise stated, the property is appraised assuming that all required licenses, permits, certificates, consents or other legislative and/or administrative authority from any local, state or national government or private entity or organization have been or can be obtained or renewed for any use upon which the value estimate contained in this report is based. Except as specifically stated, data relative to size and area was taken from sources considered reliable, and no encroachment of real property improvements is considered to exist. No opinion is expressed as to the value of sub-surface oil, gas, or mineral rights, or whether the property is subject to surface entry for the exploration or removal of such materials, except as is expressly stated. Maps, plats, and exhibits included in this report are for illustration only to serve as an aid in visualizing matters discussed within this report. They should not be considered as surveys or

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relied upon for any other purpose; nor should they be removed from, reproduced, or used apart from this report. No opinion is expressed on matters, which require legal expertise or specialized investigation, or knowledge beyond that customarily employed by real estate appraisers. The distribution, if any, of the total valuation in this report between land and improvements applies only under the stated program of utilization. The separate allocations for land and buildings must not be used in conjunction with any other appraisal and are invalid if so used. The possession of this report, or copy thereof, does not carry with it the right of publication. Without the written consent of the appraiser, this report may not be used for any purpose by any person other than the party to whom it is addressed. In any event, this report may be used only with the written qualification and only in its entirety for its stated purpose. Any dispute of claim made with respect to this report shall be submitted to and resolved in accordance with the rules of the American Arbitration Association for arbitration, and the decision of the Association shall be binding. All appraisal services, pursuant to this report, shall be deemed contracted for and rendered in Orange County, California, and any arbitration or judicial proceedings shall take place in Orange County, California. Any value estimates provided in the report apply to the entire property, and any proration or division of the total into fractional interests will invalidate the value estimate, unless such proration or division of interests has been set forth in the report. This report may contain prospective financial information, estimates, or opinions that represent the appraiser's view of expectations at a particular point in time, but such information, estimates, or opinions are not offered as predictions or as assurances that a particular level of income or profit will be achieved, that events will occur, or that a particular price will be offered or accepted. This appraisal is based on market conditions existing as of the date of the appraisal. Steven Kerhart and Bradley Holtz are designated members (MAI) of the Appraisal Institute. The Bylaws and Regulations of the Institute require each member or associate to control the use and distribution of each report signed by such member or associate. Therefore, except as hereinafter provided, the party for whom this report was prepared may distribute copies of this report, in its entirety, to such third parties as may be selected by the party for whom this report was prepared; however, selected portions of this report shall not be given to third parties without the prior written consent of the signatory of this report. Further, neither all nor part of this report shall be disseminated to the general public by the use of advertising media, public relations media, news media, sales media or other media for public communication without the prior written consent of the signatory of this report. We shall not be required, by reason of this report, to give testimony or to be in attendance in court or any governmental or other hearing with reference to the property without prior arrangements having first been made with us relative to such additional employment. Under the terms of the engagement, we will have no obligation to revise this report to reflect events or conditions, which occur subsequent to the date of the transmittal. However, we will be available to discuss the necessity for revision resulting from changes in economic or market factors affecting the subject.

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The Americans with Disabilities Act (ADA) became effective January 26, 1992. We have not made a specific compliance survey and analysis of the property to determine whether or not it is in conformity with the various detailed requirements of the ADA. It is possible that a compliance survey of the property together with a detailed analysis of the requirements of the ADA could reveal that the property is not in compliance with one or more of the requirements of the Act. If so, this could have a negative effect on the property's market value. Since we have no direct evidence relating to this issue, we did not consider possible non-compliance with the requirements of the ADA in our market value estimates. In accordance with the Fair Housing Amendments Act, it is illegal for an appraiser to discriminate against any person because of race, color, religion, sex, hardship, familial status, or national origin. This appraisal complies with all rules and regulations prohibiting discrimination based on race, color, religion, sex, national origin, and marital status.

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Professional Qualifications

BRADLEY J. HOLTZ, MAI, ASA Professional Qualifications ____________________________________________________________________________

Experience

Mr. Holtz has been actively engaged in the appraisal profession since 1984. He has helped clients make real estate decisions through studies including valuations, appraisal reviews and a variety of consulting assignments. His work has been used in support of a variety of functions, including property and portfolio acquisitions and dispositions, tax and estate planning, litigation support, purchase price accounting for financial reporting and tax purposes, property tax appeals, development bond financing, conventional and public agency-related loan originations and public board, commission and agency presentations. At present and between 1999 and 2007, Mr. Holtz has been Executive Vice President/Senior Managing Director of Continental Realty Advisors, an independent appraisal firm focused on the California, Nevada and Arizona market areas. Between 2007 and 2009, Mr. Holtz served as Vice President of Operations for Valuation & Information Group, a healthcare appraisal firm with a nation-wide focus. From 1984 through 1999, Mr. Holtz was employed by Arthur Andersen LLP, ultimately as Senior Manager for Real Estate Advisory Services, directing client activities in the southwest region. Mr. Holtz has testified as an expert witness regarding real estate valuation matters before the Superior Court for the State of California. He has also served as a consulting expert and has presented studies and testified before various public agencies, boards and commissions.

Property Types Studied

Mr. Holtz has performed valuations, appraisal reviews and consulting studies on a variety of real property types including residential and commercial development land, golf courses, healthcare and senior housing facilities, convenience stores, restaurants, hotels, casinos, condominiums, offices, and industrial facilities. His experience includes a large number of operating properties that include business enterprise value in addition to real property and other tangible assets. He has also prepared valuations and analyses of personal property assets, complex ownership structures and partial interests, including limited partnership interests and shares of stock in closely-held corporations with significant real property holdings.

Education

Mr. Holtz received his Bachelor of Science degree (cum laude) from the University of Southern California in 1984, with a major in finance. He has completed numerous courses and seminars presented by the Appraisal Institute, the American Society of Appraisers and the International Right of Way Association.

Professional Affiliations

Mr. Holtz is a Member of the Appraisal Institute (MAI) and a Senior Member (ASA) of the American Society of Appraisers. He is certified as a General Appraiser in the states of California (No. AG005984) and Nevada (No. 00519). Mr. Holtz is also a former member of the Advisory Board for the Lied Institute for Real Estate Studies at UNLV.

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STEVE KERHART CPA, ASA, MAI, CCIM, MRICS, MCR Professional Qualifications ____________________________________________________________________________

Mr. Kerhart is Managing Executive Vice President/Chief Valuation Officer of Continental Realty Advisors (CRA), a full service consulting valuation firm. Mr. Kerhart is one of less than 100 individuals in the United States that has held (CPA) and presently maintains the ASA, MAI, MRICS, CCIM, MCR designations. Mr. Kerhart was formerly the Real Estate Chair for the California Society of CPA's (1996/1997), on the Real Estate Advisory Board for California State University at Fullerton (97/98), and on Wachovia’s National Valuation Advisory Panel between 1999 and 2002. Prior to forming CRA he was President of CKQ Inc. (1991-1995) and a Senior Analyst in The Real Estate Services Group with a Big 8 Accounting Firm (1986-1990). Mr. Kerhart has prepared and supervised consulting assignments involving most major categories of real estate, going concern, machinery and equipment, and personal property. Mr. Kerhart has appraised and reviewed over $40+ Billion of real property and other assets since 1986. The firm typically completes 500+ appraisals, evaluations, and market studies per year throughout California, Nevada, Arizona and Washington. Most involve valuations and/or consulting for financing, workouts, sale and purchase, litigation support and investment analyses.

Business Philosophy: Client focused and centered service - acting as ambassadors for our clients while providing impartial ‘timely, professional, well supported’ valuations. The firm’s key clients include bankers, insurance companies, attorneys, CPA’s, property owners, managers, and developers of real and personal properties and operating concerns.

Areas of Appraisal / Valuation specialization include: -Apartments / Subdivisions / Master-planned Communities / Facilities Districts (SID’s) -Hotels / Marinas / Resorts / Theaters -Automotive Dealership / Automalls / Full and Limited Service Carwashes -Commercial Retail, Office, Medical Office – Industrial, Industrial Parks, -Land, all types (residential, commercial, industrial, rural) -Litigation Support / Expert Witness / Testimony -Tax and Estate Planning Valuations / Fractional / Marketability and Minority Interests -Market Studies / Feasibility Analysis / Highest and Best Use Studies

Professional Designations (Current / Past) / State Licensing – Market Coverage: CCIM MAI CPA ASA MCR MRICS

Certified Commercial Investment Member-Current Member of the Appraisal Institute-Current Certified Public Accountant, State of California (1996-2006) Accredited Senior Member Urban Real Property-Current Masters in Corporate Real Estate, CoreNet Global Accredited Member Royal Institute of Chartered Surveyors-Current SCREA SCREA SCREA SCREA

Certified General Appraiser – California Certified General Appraiser – Arizona Certified General Appraiser – Nevada Certified General Appraiser – Washington

Professional Organizations: - Member, National and California Association of Realtors - Candidate for Senior Member/Business Valuation, ASA - Candidate for CAE designation from the IAAO - Member of the Institute of Property Taxation (IPT) - Member Urban Land Institute (ULI) - Member of the Society of Auditors and Appraisers (SAA) - Member, American Institute of Certified Public Accountants (AICPA) - Member, California Society of Certified Public Accountants (CSCPA)

Education / Continuing Education: - Bachelors of Science: Accounting and Economics, Loyola Marymount University, 1982-1986, Los Angeles, CA - Massachusetts Institute of Technology (MIT) - Center for Real Estate, Exec. Dev. Program, 2006-2009, Cambridge, MA Typically 150-200 hours per year on CE classes, conferences, seminars.

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Introduction

INTRODUCTION PURPOSE AND DATE OF THE APPRAISAL The purpose of the appraisal is to estimate the as-is market value of the fee simple interest of the subject property for use in connection with an offering memorandum for the issuance of bonds for the above-stated Special Improvement District. In addition to our estimate of the as-is market value for the subject property, we have also estimated the value of the site in its ‘as is’ partially-improved bulk acreage state. In this case, our value assumes that the value of the subject is based on a single purchase of the entire site with the currently existing on- and offsite improvements in-place. This ‘bulk’ valuation does not consider the development and marketing programs in-place or the planned infrastructure improvements, including those to be funded by the subject Special Improvement District. The subject property is located in the northwestern portion of the Las Vegas Valley, in the city of Las Vegas, Nevada. The effective date of appraisal is August 1, 2017. INTENDED USE OF THE APPRAISAL The intended use of the appraisal is to provide the city of Las Vegas with a present market value estimate of the subject property for use in connection with the bond official statement for the issuance of bonds for the subject Special Improvement District. This report is not intended to be used in any other capacity. EXTENT OF DATA COLLECTION As part of this assignment, we made a number of independent investigations and analyses. In conducting our investigation, various governmental planning agencies and the local Chamber of Commerce were contacted for demographic data, land policies and trends, and growth estimates. Neighborhood data was supplemented by physical inspection of the defined area. Information regarding zoning, utilities, and other limitations on site utilization was obtained from the client and through the appropriate agencies. All phases of the competitive market were analyzed for past trends and current data. A diligent search for comparable data was conducted, and comparable information was obtained from both public and private sources. In the case of comparable sales, attempts were made to contact the buyers or sellers or knowledgeable third parties to verify that the transactions were at arm's length, cash equivalent and market reflective. The considered comparison information was within the property's market area and was analyzed and adjusted, where necessary, for use in deriving separate value indications. APPRAISAL DEVELOPMENT AND REPORTING PROCESS In order to arrive at a value indication for the subject property, we have investigated the general economy of the Las Vegas Valley, as well as the specifics of the real estate

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market around the subject property at the date of the appraisal. The subject property was physically inspected, and the site descriptions are presented within this report. The legal and physical factors affecting the subject property, in addition to an analysis of the financial feasibility of the development enabled us to determine the highest and best use of the subject site as vacant, proposed, or improved. Based upon the highest and best use of the subject property, we have prepared a valuation section considering three approaches to value (Cost, Sales Comparison, and Income). Because of the nature of the subject property, we valued it using a Development Approach. The Development Approach incorporates aspects of all three approaches to value in one approach. Our analysis involved investigating sales of similar parcels of vacant land, as well as applicable improved sales, in the subject market. We have additionally spoken with buyers, sellers, real estate brokers, appraisers, and public officials to confirm data as it pertains to the subject property in this appraisal assignment. The appraisal assignment was not based on a requested minimum valuation, a specific valuation, or the approval of a loan. This report has been prepared in accordance with the Uniform Standards of Professional Appraisal Practice; the Code of Ethics and Standards of Professional Practice of the Appraisal Institute, This report is intended to comply with the reporting requirements set forth under Standards Rule 2-2(a) of the Uniform Standards of Professional Appraisal Practice for an Appraisal Report; however the level of discussion, as agreed upon with our client, is consistent with the historic definition of a Summary Appraisal Report (Standards Rule 2-2(b) of the 2012-13 USPAP). As such, it presents only summary discussions of the data, reasoning and analyses used in the appraisal process to develop the appraisers’ opinions of value. The depth of discussion contained in this report is specific to the needs of the client and for the intended use stated herein. USPAP COMPETENCY PROVISION We have the knowledge and experience to complete this appraisal assignment and have appraised these property types before. Please see the Professional Qualifications included on pages ix and x of this report for additional information. PROPERTY RIGHTS APPRAISED We have appraised the fee simple interest in the subject property. Fee simple title is defined as "an absolute ownership unencumbered by any other interest or estate; subject only to the limitations of eminent domain, escheat, police power, and taxation."1 DEFINITION OF MARKET VALUE "Market Value," as used in this report, is defined as: 1

Dictionary of Real Estate Appraisal, Fifth Edition, published by the Appraisal Institute, 2009.

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Introduction

"The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: 1.

buyer and seller are typically motivated;

2.

both parties are well informed or well advised, and acting in what they consider their best interests;

3.

a reasonable time is allowed for exposure in the open market;

4.

payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and

5.

the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted 2 by anyone associated with the sale.”

AS-IS PREMISE As-is market value is defined as an estimate of the market value of a property in the condition observed upon inspection and as it physically and legally exists without hypothetical conditions, assumptions, or qualifications as of the date the appraisal is prepared (Appraisal Policies and Practices of Insured Institutions and Service Corporations, Federal Home Loan Bank Board, “Final Rule,” 12 CFR, parts 563 and 571, December 21, 1987). BULK ACREAGE VALUE The term "bulk acreage value" is defined by CRA as follows: The value to a single buyer of the property in its as-is, partially-improved condition, absent any existing marketing programs and planned infrastructure improvements.

2 The Appraisal of Real Estate, Thirteenth Edition, 2008 Appraisal Institute.

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Subject Property

SUBJECT PROPERTY LOCATION The subject property, referred to as Special Improvement District (SID) No. 609, serving the Skye Canyon Phase 2 development, located in the northwestern portion of the Las Vegas Valley, in the city of Las Vegas, Nevada. The subject SID comprises the area located north of Grand Teton Drive and extending west from Skye Village Road. The subject Special Improvement District consists of the salable portions of those areas concluded to comprise the assessable acreage within Skye Canyon Phase 2, totaling 218.48 acres. Additional acreage exists to be dedicated for two parks, trail/greenway, flood control/public facility and other non-assessed parcels. The non-assessed acreage has not been addressed herein. LEGAL DESCRIPTION The subject’s has a lengthy metes and bounds legal description. It is included in the Developer-provided preliminary title report prepared by First American Title Insurance Company and dated November 17, 2015. A copy of this report, with legal description, is attached.

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Area Analysis

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Area Analysis

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Area Analysis

AREA ANALYSIS INTRODUCTION The subject property is located in the northwestern portion of the Las Vegas Valley, within the city of Las Vegas, Nevada. Clark County is the southernmost county in the state, bordering California to the West and Arizona to the southeast. Most of Clark County is located within the Mojave Desert Clark County is the sixth largest of Nevada's seventeen counties, covering approximately 8,084 square miles and accounting for 4.4% of Nevada's total surface area of 110,540 square miles. The five incorporated cities in Clark County are: the City of Las Vegas, the City of Henderson, Boulder City, North Las Vegas and Mesquite. REGIONAL DESCRIPTION Clark County is home to the world-famous Las Vegas Strip, heart of the Entertainment Capital of the World and site of the nation's 15 largest hotels. This jewel in the desert lures many of the 36.0MM tourists to the Las Vegas community each year to enjoy its entertainment and hospitality, casinos, restaurants and shopping venues. This excitement is surely a factor in the nation-leading growth of Clark County's booming population of 2.0MM (70% of the state population). Another factor is the high quality of life afforded by its low tax rate, wonderful business climate, great weather, friendly people and countless recreational venues. Those venues stretch beyond the Strip to include the gambling destinations of Mesquite, Primm and Laughlin, located on the Colorado River. They also feature Lake Mead National Recreation Area and Hoover Dam, Mt. Charleston and the Toiyabe National Forest, Red Rock Canyon, the Valley of Fire and parks, museums and recreational and cultural attractions. More people live in urban Clark County than in any of Southern Nevada’s cities, including the City of Las Vegas. Geographically, this area of the unincorporated county includes the Las Vegas Strip and takes in McCarran International Airport, the Las Vegas Convention Center, the University of Nevada, Las Vegas and its surrounding neighborhoods. The county provides regional services for 2 million residents and 36 million tourists a year and occupies 8,012 square miles. Clark County is one of the fastest-growing areas in the country, with more than 5,000 people moving to the area each month. Although the downturn in the economy resulted in a modest population loss, gains are taking hold once more, with Clark County realizing an increase of 30,011 in 2010, just over 2,500 per month. The county has about 38,930 licensed businesses. The County government takes a leadership role in protecting the quality of our air through its Air Quality and Environmental Management Department and water through the Las Vegas Valley Water District, whose board is comprised of the seven members of the Clark County Commission. The county also operates McCarran and other airports, Southern Nevada’s only public hospital (University Medical Center), social services, community planning and the court system. Further, the county plays a key role in promoting tourism, transportation, public health and flood control. It also provides

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town services for unincorporated townships such as Laughlin and rural areas such as Overton, Goodsprings, Jean and Searchlight. TRANSPORTATION The State of Nevada offers accessibility to the major western markets and is at the hub of the western transportation system, an important fact for any business where access and location are key. Its location is situated as the hub of the 11 state western regions, with a market area of 51.0MM people within one day’s drive. McCarran International Air Cargo Center continues to meet the needs of Southern Nevada's growing business community through the expansion of its cargo handling capabilities. The Las Vegas International Air Cargo Center opened in April 1993 with a 76,000 SF warehouse. Currently, the 160-acre site is a first-rate cargo handling area consisting of three buildings totaling more than 170,000 SF. Southern Nevada is located on two major highway corridors: I-15 and I-95. Southern Nevada is served by more than 50 motor carriers, including several specialized carriers. The area provides a number of warehousing and manufacturing related support services including specialized contract haulers, full service public warehousing, U.S. Customs service, Foreign Trade Zone #89, and subzone accommodations, assembly and packaging support. Southern Nevada’s Class I rail service is provided by Union Pacific Railroad. The line runs northeast/southwest through Clark County providing access to several industrial sites. The railroad provides intermodal service with daily switching frequency as well as standard boxcar and tank-car service. EMPLOYMENT TRENDS According to the State of Nevada Department of Employment, Training & Rehabilitation (“DETR”), Nevada’s unemployment rate held steady in June, at a seasonally-adjusted 4.7 percent, for the third month in a row. Additionally, the rate is down a full percentage point from a year ago. “The Silver State has reached yet another milestone in its economic recovery,” said Governor Brian Sandoval. “As job levels have surged to record highs and the unemployment rate has been cut by nine full percentage points from its peak, Nevada’s Unemployment Insurance Trust Fund has improved markedly and ended this year’s second quarter with a record balance of $886 million, a far cry from the depths of the recession when the Fund had a negative balance of $800 million.” Initial claims for unemployment insurance continued to improve this month, with claims falling by 3.5 percent from June 2016, to 10,760, said Bill Anderson, chief economist for Nevada’s Department of Employment, Training and Rehabilitation. “Another positive indication of Nevada’s recovery that should be noted is the improvement in the long-term unemployment rate,” Anderson said. “For the 12-month period ending in June 2017, the long-term unemployment rate is 1.2 percent, down 5.8

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percentage points from the peak. At the height of the recession, the number of longterm unemployed in Nevada totaled 92,900. Currently, it stands at 16,600.” The State continues to see strong job growth, steady unemployment rates, declining unemployment insurance claims, and increasing wages, small business jobs, and employer counts. Nevada is once again at record-high employment in June, with a seasonally-adjusted gain of 10,600 jobs this month bringing total nonfarm employment to 1,342,100. The seasonally-adjusted increase is a result of the State adding 9,800 jobs when 800 jobs were expected to be lost based upon historical trends. Our previously-reported decline of 6,500 jobs in May was additionally revised upward by 4,400 jobs, resulting in a seasonally-adjusted decline of just 2,100 last month. Coupled with this month’s gain, employment in the Silver State currently stands 230,600 higher than during the height of the recession. Further, the State has seen year-over-year gains for the 78th straight month, with employment 48,700 higher than this time last year, a growth of 3.8 percent. Nationally, employment grew only 1.6 percent over the year, making June the 59th consecutive month that Nevada’s year-over-year job growth has outpaced the nation. The private sector added 10,100 new jobs, seasonally-adjusted, while the public sector increased by 500 in June. Specifically, 8,000 service-providing jobs were added while goods-producers added 2,600 over the month. The largest year-to-date gains were found in professional and business services (+9,800 jobs), leisure and hospitality (+7,600), and construction (+7,500). The growth in construction marks a ten percent increase over the first six months of last year. Information (-100) is the only sector to see a decline in employment year to date.

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Area Analysis

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Metro area unemployment rates varied on a month-over-month basis, but decreased year over year in May. This marks the first time since late-2007 that all metro areas in the Silver State have unemployment rates below 5 percent, said Bill Anderson, chief economist for Nevada’s Department of Employment, Training and Rehabilitation. The unemployment rate in Las Vegas remained at 4.8 percent and the rate in Reno stayed at 3.9 percent in May. Carson City’s rate declined to 4.7 percent, down 0.3 of a percentage point relative to April. Unemployment rates decreased on an over-the-year basis in all 17 of the state’s counties. According to the most recent LVCVA Executive Summary (June 2017) June's visitation neared 3.6 million, the second busiest June on record but down -2.3% from last year's particularly strong month. Occupancy came in at 92.6% (down -0.9 pts) while ADR saw a slight increase of +0.2%. Room inventory also reflected a net decrease of -0.6% over last year due to a mix of room count adjustments at various properties. With a decrease in smaller meetings during the month, convention attendance saw a small decline of 2.4% in June. County and Strip gaming revenues were up +0.3% and +1.6% respectively, due in part to increases in non-baccarat table games win. Passenger traffic at McCarran was up +1.5% for the month vs. last year. Average Daily Auto Traffic for all major highways was up +1.1% and traffic on I-15 to/from Southern California was down -0.9%. Economic Outlook The Center for Business and Economic Research (CBER) Third Quarter 2017 “Quarterly Indicators” reported The Southern Nevada Business Confidence Index, constructed by the Center for Business and Economic Research (CBER) at the University of Nevada, Las Vegas (UNLV), fell slightly by 0.5 percent from 137.2 in the second quarter to 136.5 in the third quarter of 2017. Although the index ticked down marginally due to seasonality, it continued to remain high as local business leaders stayed positive on the overall economic conditions for both Southern Nevada and the U.S. The index climbed 3.3 percent from a year ago from 132.1 to 136.5. The index includes five components: business expectations of (i) general economic conditions in Nevada, (ii) sales, (iii) profits, (iv) hiring, and (v) capital expenditures. The index remains above 100, which implies that respondents, on average, feel more positive than negative about the five components. Among the five components, the values for profits and hiring experienced losses, while the values for sales, capital expenditures, and economic conditions experienced gains from a quarter ago. Southern Nevada business leaders reported positive attitudes as the components of the index all remained well above 100. The index values for business expectations of Nevada economic conditions, sales, profits, hiring, and capital expenditures scored 158.1, 147.8, 133.7, 117.8, and 125.3, respectively. The most recent CBER Business Survey shows an optimistic outlook for the Southern Nevada and U.S. economies. Positive expectations on rising home prices and a pick-up

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Area Analysis

11

in construction activity suggest that the real estate market will remain strong in the third quarter of 2017. In spite of a recent large loss in employment, the optimistic outlook on hiring also implies that employment should continue to expand. Local business leaders’ positive prospects on sales, profits, and capital expenditures suggest that the Southern Nevada economy will continue to move forward. Even though economic policies of the new administration still remain uncertain at this point, the expectations of Southern Nevada business leaders remain positive on the final outcome. Finally, as the majority of Clark County tourists reside in the United State, a continuation of the U.S. economic expansion should support Southern Nevada’s recovery. Conclusion The region continues to grow with most industries benefitting from the growth since 2012. Given 60-year interest rate lows, we are optimistic that the positive momentum observed between 2013 and 2016, will be sustained over the balance of 2017 and beyond.

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Residential/Master-Planned Community Market Overview

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RESIDENTIAL MARKET OVERVIEW Las Vegas Housing Market Overview According to the Greater Las Vegas Association of Realtors (GLVAR) press release dated July 6, 2017, local home prices and sales continued to climb as homes continue to sell faster amid a very tight housing supply. GLVAR reported that the median price of existing single-family homes sold during June through its Multiple Listing Service (MLS) increased to $257,373. That was up 2.9 percent from May and up 9.5 percent from June 2016. Meanwhile, the median price of local condos and townhomes sold in June was $128,000, down 7.2 percent from May, but up 11.3 percent from June 2016. For the first time this year, GLVAR President David J. Tina said the local housing supply actually increased, with the number of homes available for sale rising very slightly from May to June. But at the current sales pace, he said Southern Nevada still has less than a two-month supply of existing homes available for sale. A six-month supply is considered to be a balanced market. “We’re still dealing with a housing shortage, but at least our housing supply didn’t get any tighter last month,” Tina said. Tina said the current housing market can be difficult for prospective home buyers, especially those looking for homes in lower price ranges. He advises would-be buyers to be aggressive and be prepared to “put a ring on it” when they find a home they like. “If you’re looking for a home under $300,000, you’re really going to have to compete,” he said. “If you’re looking for a home between $350,000 and $800,000, you may have a better shot. The high- end market is a different story.” By the end of June, GLVAR reported 5,174 single-family homes listed for sale without any sort of offer. While up 4.1 percent from May, that’s down 27.1 percent from one year ago. For condos and townhomes, the 639 properties listed without offers in June were up 1.4 percent from May, but still represented a 51.9 percent drop from one year ago. Meanwhile, local home sales continue to increase. The total number of existing local homes, condos and townhomes sold in June was 4,368, up from 3,957 in June 2016. Compared to one year ago, sales were up 10.3 percent for homes and up 10.6 percent for condos and townhomes. According to GLVAR, total sales so far in 2017 continue to outpace 2016, when 41,720 total properties were sold in Southern Nevada. That was more than the 38,577 properties sold during 2015. It was also more total sales than in 2014, but fewer than each year from 2009 through 2013. GLVAR said 27.2 percent of all local properties sold in June were purchased with cash, up slightly from 27.0 percent in June 2016. That’s well short of the February 2013 peak of 59.5 percent, indicating that cash buyers and investors are still more active in Southern Nevada than in most markets, but that their influence has generally been declining.

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Residential/Master-Planned Community Market Overview

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For several years, GLVAR has been reporting fewer distressed sales and more traditional home sales, where lenders are not controlling the transaction. That trend continued in June, when 3.4 percent of all local sales were short sales – which occur when lenders allow borrowers to sell a home for less than what they owe on the mortgage. That compares to 4.4 percent of all sales in June 2016. Another 2.9 percent of all June sales were bank-owned, down from 5.9 percent one year ago.

These GLVAR statistics include activity through the end of June 2017. GLVAR distributes statistics each month based on data collected through its MLS, which does not necessarily account for newly constructed homes sold by local builders or homes for sale by owners. Other highlights include: 

The total value of local real estate transactions tracked through the MLS during June was more than $1 billion for homes and more than $112 million for condos, high-rise condos and townhomes. Compared to one year ago, total sales volumes in June were up 17.8 percent for homes, and up 29.0 percent for condos and



Homes and condos continued to sell faster than last year at this time. In June, 83.3 percent of all existing local homes and 87.2 percent of all existing local Continental Realty Advisors: Full Service Real Estate Appraisal & Consulting (949) 221-0975

Residential/Master-Planned Community Market Overview

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condos and townhomes sold within 60 days. That compares to one year ago, when 74.2 percent of all existing local homes and 71.2 percent of all existing local condos and townhomes sold within 60 days. New Construction According to a Metrostudy News release dated May 10, 2017, Metrostudy’s 1Q17 survey of the Las Vegas housing market shows that annual single-family new home closings were 7,925, up 19% from 2016. Annual starts are up 12%. 1Q17 quarterly starts are also up 6% compared to 1Q16 as builders remain confident in the market. The first quarter’s closing pace increased by 39%. All of which can be indicative of both increased demand, low levels of finished inventory, and tight lot supply. Annual new home starts are at the highest level since 1Q08. “New home production under $200k has now been eliminated as base prices have shifted into the $200k-$400k range,” said Greg Gross, Regional Director of Metrostudy’s Las Vegas office. “2017 will mark the year that more product will be coming on line priced above $500k. Our average “offer to build” price for all SFD active projects is $417K; up 6% compared to year ago. Higher land and construction costs coupled with strong demand are forcing builders to raise prices. Entry and mid-level product will be opportunistic as the market continues to improve.” Total Finished Vacant housing inventory has decreased 7% this year. Single Family Finished Vacant inventory decreased 2% as builders needed to replenish their vacant inventory to satisfy demand. Total Single Family inventory including units under construction has increased 11%, which may trigger a slight risk of over supply going in to 2017. Currently, there is only a 1.4- month supply of Finished Vacant homes at current absorption pace. Pricing in the resale market has increased steadily through March. The average sales price for Single Family Homes increased 7.7% this year with Median sales price up 10%. Compared to March 2016, the average asking price of for-sale homes is 11% higher at $415k. Total finished lot supply has fallen considerably over the past five years but lot deliveries did increase during 2016. There are now 8,959 Finished SFD lots today, that’s only 13 months of supply, even though 7,440 new lots were delivered during the past 12 months. A 17% decrease over the prior year’s lot deliveries. The net absorption of lots highlights the dearth of deliveries as we continue to deplete the supply even as 7,440 new lots were added over the past 12 months, we consumed 8,184 lots. There are now 10,803 lots in development compared to 1Q16 when 12,521 lots under development, the total number of lots in development has increased 9% over last quarter, but 14% fewer than last year. The majority of the new lots in development are in Summerlin, Inspirada, Skye Canyon (subject), Cadence and the general Southwest

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Residential/Master-Planned Community Market Overview

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Valley. It is worth noting that this number of finished lot supply has declined over the past year, which will keep supply relatively tight, at least for the next 12-18 months. “Las Vegas has experienced a very robust 2016, and 2017 is off to a strong start,” said Gross. Nevada is once again among the top relocation destinations, and more companies are beginning to consider Nevada. All economic indicators are expected to improve as many new projects along the resort corridor begin to materialize. The Tesla factory construction is in full swing in Reno, and has re-energized economic development for the state. Closer to home HyperLoop1 has completed their test track. On the downside, electric automobile manufacturer Faraday Future scrapped plans to develop a North Las Vegas manufacturing facility. Nonetheless, within the past year, Las Vegas has attracted NHL and NFL! Both virtually impossible just a few years ago. Over-supply of lots along with diminished demand has driven down lot prices and land values in the past, but the quickly shrinking supply will force builders to pay more for lots, which will pressure affordability. With that said, Metrostudy is forecasting 9,140 total new home starts in 2017.” CONCLUSION The near-term outlook for the southwest region’s home ownership market is positive. Although inventory and prices are up, Zillow forecasts prices will rise 6.2% within the next year. Housing permits have continue to edge upward, but are well below the highs seen in the run-up to the market crash circa 2008. On balance, the outlook is positive for the housing market. We believe the Skye Canyon Phase 2 community will compete well with comparable new home developments and planned communities in the Northwest submarket and greater Las Vegas Valley. The scale of experience and commitment of the development team to shape and promote the project to a high standard should insure that the project will be widely accepted and highly regarded in the market place.

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Description of the Site

AERIAL VIEW

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Description of the Site

SITE PLAN – SKYE CANYON PHASE 2

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18

Description of the Site

DESCRIPTION OF THE SITE LOCATION The subject property, referred to as Special Improvement District (SID) No.609, serving the Skye Canyon Phase 2 master-planned development, located in the northwestern portion of the Las Vegas Valley, in the city of Las Vegas, Nevada. The subject SID comprises those portions of the larger Skye Canyon community that are generally located north of Grand Teton Drive, west of Skye Village Road (northerly extension of Hualapai Way) and extending northward to W. Skye Canyon Park Drive and an arroyo/wash extending southwest therefrom. CONFIGURATION/SIZE The subject Special Improvement District, as appraised herein, consists of those areas concluded to comprise the assessable acreage within Skye Canyon Phase 2, totaling 218.48 acres. The remaining acreage is dedicated for open space, parks and other non-assessed parcels. A summary description of the appraised acreage is illustrated in the following table. Skye Canyon Phase 2 Las Vegas, Nevada Parcel

1/

2.14 2.15 2.16 2.17 2.20 2.21a 2.21b 2.23a 2.23b 2.27 2.28 2.29 2.35

Totals/Avg's

Assessable Acres 12.25 19.92 17.08 16.94 28.17 15.12 16.01 12.52 16.76 19.53 20.32 18.38 5.48 218.48

Product Category

Units

Families - Luxury Families - Value Mature Couple - Family Mature Couple-Family - Luxury Single-Young Couple/Family Young Couple/Family Value Single-Young Couple Value Mature Couple - Family Families - Value Families - Value Families - Value Young Couple/Family Value-Single Story Charter School

53 88 66 50 178 85 127 96 102 110 100 122 -

4.33 4.42 3.86 2.95 6.32 5.62 7.93 7.67 6.09 5.63 4.92 6.64 -

1,177

5.39

Density

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Description of the Site

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TOPOGRAPHY AND SITE CONDITIONS The subject site is generally flat with a gentle area downslope from southwest to northeast. The site is characterized by sparse desert vegetation, dry gravely soils and by distinct drainage ways that cross the property, generally from west to east. Precipitation at the site is low, with a mean annual rainfall varying from about four to five inches within its borders, and up to ten inches in the La Madre Mountains to the west. The majority of the precipitation occurs during summer thunderstorm activity. Estimated 100-year, six hour precipitation is approximately 2.5 inches. Vegetal cover, which is generally sparse, comprises desert shrub, Yucca and grass. SOIL CONDITIONS / ENVIRONMENTAL In the course of this assignment, we received a Phase I Environmental Site Assessment prepared by GeoTek Residential Services, LLC and dated November 14, 2014. This report addressed the larger Skye Canyon development in addition to the subject Phase 2. In general, the report concludes that no environmental conditions associated with the site were identified. No further environmental investigation was deemed necessary. The reader is referred to a copy of this report, on file with the City with a copy retained in our files, for further details. For the purposes of this appraisal we assume that the soil is of adequate load bearing capacity to support the subject development in accordance with its highest and best use. It has been noted that caliche soil types are common through the region, which can complicate land excavation and development. Within the subject community, these areas are believed to have generally been identified in the planning and engineering stages, wherein they are typically designated as open space areas. ACCESS AND EXPOSURE The subject site is currently accessed by Skye Village Road (northerly extension of Hualapai Way) and W. Skye Canyon Park Drive (westerly extension of Horse Drive. In addition, Highway I-95 has on- and offramps proximate to the subject (apx. one mile to the east) via Horse Drive. Hualapai Way provides access to the Bruce Woodbury Beltway (Clark County 215) roughly 1.8 miles to the south. The major arterial roads and parkways that are funded by the Special Improvement District (SID) bonds in accordance with the master plan will enable a smooth traffic flow throughout the community. ZONING The land contained within the Special Improvement District falls within the zoning jurisdiction of the City of Las Vegas. Initial specific plans have been submitted for Skye Canyon Phase 2. Further specific plans have been, and will continue to be, submitted as end-product specifications are finalized. It is a special assumption of this appraisal

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Description of the Site

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that the ultimate property uses (in terms of unit densities, price points, etc.) conform to the overall project as described herein. UTILITIES The subject property is served by Southwest Gas Company, NV Energy, Las Vegas Valley Water District. The cost to extend the existing water and sewer lines to the subject property is covered by the existing SID bond. The SID does not cover gas, power, or telephone lines. STORM DRAINAGE Skye Canyon Phase 2 is expected to contain drainage channels and washes that border or cross the site collecting run-off from a watershed which begins in the mountains to the southwest. The drainage pattern is generally to the northeast. Given planned site grading and related drainage improvements, development is not expected to occur within any flood plain/drainage areas. EASEMENTS We received and reviewed a preliminary title report prepared by First American Title Insurance Company and dated November 17, 2015. We have included a copy of this report in the addenda. There were no significant adverse easements noted which could affect the utility and/or value of the subject property. CONCLUSION The subject parcels are expected/assumed to be of adequate condition, in terms of physical suitability as well as planned infrastructure and regional access, to support development to its highest and best use.

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Proposed Development Plan

PROPOSED DEVELOPMENT PLAN The Skye Canyon master plan calls for a community of mixed land uses, although predominately single family residential in character of varying levels of density. Just under ten percent of the gross area for Skye Canyon’s overall land is reserved public use as parks, schools and open space. Olympia Companies has created a master plan for a vibrant community that redefines and elevates indoor/outdoor living. For Skye Canyon, these elements include a variety of residential properties, community-based retail centers and recreational and other public areas. Skye Canyon launched its “Fit Lives Here” program, which is a series of events including a 5K and 8K trail run and yoga. Skye Canyon Park, a fully developed community, fitness center and park serves as the social heart of the community. It is a 13-acre multi-use gathering place and central hub that includes a great room, indoor and outdoor seating areas, coffee bistro, stone fireplaces, barbecue patio, fully equipped fitness center, Junior Olympic-sized pool, sports field, basketball court, jogging path, tot lot, and splash pad. The objective of providing a cross-section of housing and commercial opportunities is expected to have broad demographic appeal that will attract a diverse and stable population. The development plan has anticipated the need for a quality lifestyle with commercial and recreational uses readily available and allowing residents complete service from within the master plan. The following is a brief summary of the current plans for Skye Canyon Phase 2 as they were presented to us by Olympia Companies. LAND USE PLAN SID NO. 609 Parcel

Net Acres

Map Use Code

Use / Product Category

Units

2.14 2.15 2.16 2.17 2.20 2.21a 2.21b 2.23a 2.23b 2.27 2.28 2.29 2.35

12.25 19.92 17.08 16.94 28.17 15.12 16.01 12.52 16.76 19.53 20.32 18.38 5.48

L L L L ML ML ML ML ML ML ML L PF

Families - Luxury Families - Value Mature Couple - Family Mature Couple-Family - Luxury Single-Young Couple/Family Young Couple/Family Value Single-Young Couple Value Mature Couple - Family Families - Value Families - Value Families - Value Young Couple/Family Value-Single Story Charter School

53 88 66 50 178 85 127 96 102 110 100 122 -

4.33 4.42 3.86 2.95 6.32 5.62 7.93 7.67 6.09 5.63 4.92 6.64 -

1,177

5.39

Totals

218.48

Density

The Skye Canyon community will, on ultimate completion, encompass an area of roughly 1,500 acres in the northwestern portion of the Las Vegas Valley. The land that is the subject of this report is contained within the subject Special Improvement District

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Proposed Development Plan

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No. 609. In general, the acreage in the subject area (Phase 2) either remains to be developed or is partially improved. A community structure has been defined to guide development and provide a consistent framework for future planning and design efforts.

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Tax Analysis

TAX ANALYSIS The property is located within the taxing jurisdiction of Clark County. The subject Special Improvement District has been formed to install the basic infrastructure and drainage system to support the subdivisions discussed in the previous section. Within the subject, after the completion of the basic infrastructure and improvements, the property will be reassessed (with the SID assessment apportioned) and individual lots will receive an assessor parcel number. When the developer eventually sells the final housing product, the actual cost of the assessment will be passed on to the individual property owner and will be payable semi-annually. For the purposes of this appraisal, we assume that a similar process to the above mentioned will occur for all the assessed areas. In the state of Nevada, the sale of a property does not trigger a reassessment of the property. Land and improvements are separately reappraised every two to three years. The Clark County Assessor's office appraises land by the comparable sales method and improvements are appraised on a replacement cost less depreciation method. Typically, a yearly increase in total assessed value is approximately two percent. The following chart summarizes the property tax information that is available at present.

Skye Canyon Phase 2 LAS VEGAS, NEVADA TOC/Valuation

Taxes as

Ow ner

Parcel

APN

KAG Development West LLC

2.14

126-12-710-002

KAG Development West LLC

2.15

126-12-710-003

KAG Development West LLC

2.16

126-12-710-004

KAG Development West LLC

2.17

Section 12 LLC

Less:

Taxable

Assessed

$964,688

$964,688

$31,624

$0

$31,624

$1,568,700

$1,568,700

$51,425

$0

$51,425

$1,345,050

$1,345,050

$44,093

$0

$44,093

126-12-310-001

$1,319,063

$1,319,063

$43,242

$0

$43,242

2.20

126-12-101-002 (por)

Not Segregated

KAG Development West LLC

2.21a

126-12-810-001

$1,190,700

$1,190,700

$39,034

$0

$39,034

KAG Development West LLC

2.21b

126-12-410-001

$1,260,788

$1,260,788

$41,331

$0

$41,331

KAG Development West LLC

2.23a

126-12-810-002

$985,950

$985,950

$32,321

$0

$32,321

KAG Development West LLC

2.23b

126-12-410-002

$1,319,850

$1,319,850

$43,267

$0

$43,267

KAG Development West LLC

2.27

126-12-810-003

$1,537,988

$1,537,988

$50,418

$0

$50,418

KAG Development West LLC

2.28

126-12-810-004

$1,600,200

$1,600,200

$52,458

$0

$52,458

KAG Development West LLC

2.29

126-12-810-005

$1,447,425

$1,447,425

$47,449

$0

$47,449

KAG Development West LLC

2.35

126-12-411-001

Not Segregated

$0

$476,663

Totals/Averages

Assessed

$14,540,402

Cap. Reduc'n Net Taxes

Not Segregated

Not Segregated $14,540,402

$476,663

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History of the Subject Property

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HISTORY OF THE SUBJECT PROPERTY Special Improvement District No. 609 contains 218.48 salable acres of land. As shown in the attached Commitment for Title Insurance (First American Title Insurance Company, dated November 17, 2015), the legal ownership of the subject property has been held by KAG Development West, LLC (“KAG” or “the Developer”), a subsidiary entity of Olympia Companies. We note that APN 126-12-101-002, which is the larger parcel that encompasses a portion of Parcels 2.17 and 2.20 (see discussion of right of way easement that follows) has Section 12, LLC as owner (a related entity) According to a Las Vegas Sun article, Focus Property Group acquired the subject and surrounding acreage from the BLM via auction for $510 million in 2005. The economic downturn led the former Wachovia Bank to foreclose on the property in the latter part of 2008. The property was held by the lender until acquired as noted above. The project was subsequently re-planned and the first phase was under development by mid-2015 with initial home sales closing in August of that year (Phase 1). The Final Map for Skye Canyon Phase 2 was recorded January 13, 2017 as Instrument 0974, Book No. 20170113. Also to be included within the SID is Assessor Parcel 126-12-101-002 which totals 443.88 acres extending north and northwest of Skye Canyon. This parcel incorporates portions of the subject Parcels 2.17 and 2.20. The final mapping of these two parcels is contingent on the City of Las Vegas obtaining right of way grants from the BLM to realign a portion of a future limited access freeway (Sheep Mountain Parkway). The City of Las Vegas formally applied for the right of way grants from the BLM in April 2017. Developer and the City of Las Vegas expect approval of the right of way grant in the first quarter of 2018. Hence, the ‘gross’ acreage within the subject SID will be just over 649 acres. On the date of issuance of the Bonds, all 649 gross acres within the District will be subject to the Assessment lien; however, as development within the District progresses, the City presently expects to reapportion the Assessment lien on the property within the District to only the approximately 218 net acres that are expected to contain residential and other development. This appraisal assumes the right of way will be addressed in a timely manner and that all assessed parcels will be available for sale as estimated herein. In the interim, according to the developer’s reports and public records, seven of the developer parcels have gone under contract to builders, with one having closed in March and the remaining closings expected imminently. In addition, the charter school parcel has also gone under contract. Pricing and unit counts are discussed later herein. Aside from the preceding, the ownership has not changed in the past three years.

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Highest and Best Use

HIGHEST AND BEST USE The highest and best use of a property is defined as follows: “The reasonably probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria of highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum profitability.”'3

To test for the most feasible or the highest and best use for land as vacant, all logical and feasible alternatives must be analyzed. Each alternative use must meet the criteria. The criteria are as follows: (1)The physical use of the site - what potential uses of the site are physically possible. (2)The legal use of the site - what uses of the site are permitted under applicable zoning ordinances and other legal restrictions. (3)The feasible use of the site - what physically possible and legally permissible use of the site will produce a positive return. (4)The maximum productive use of the site - among the highest financially feasible uses, the use that provides the highest rate of return, or value (given a constant rate of return), is the highest and best use. While some investors/developers seek to maximize their returns, most seem to operate on the belief that the available information is too imperfect to permit optimization or maximization. It appears that the typical investor is satisfied if its investment can be expected to return a yield that will meet its standards. Thus, it is possible for more than one single use to be feasible for a site if the uses meet an investment criteria of the typical investor/developer for a property. Generally accepted professional appraisal practice dictates that in appraising improved property, the highest and best use be estimated under two different premises. First, the highest and best use of the site "as vacant and available" must be estimated. The second analysis estimates the highest and best use of the property as presently improved. Because the project is in its initial stages of development, we have analyzed the highest and best use of the property as vacant and proposed rather than presently improved.

3

Dictionary of Real Estate Appraisal, Fifth Edition, published by the Appraisal Institute, 2010.

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Highest and Best Use

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HIGHEST AND BEST USE OF THE SITE AS VACANT The first aspect of highest and best use, relates to the subject site, "as vacant." Each of the four tests of highest and best use will be applied to the "as vacant" discussion that follows: 1.

Physically Possible: The Site Analysis section of this report discussed the physical characteristics of the subject site. No unusual conditions or adverse topographical features are evident. The physical characteristics of the site are extremely well suited for the proposed development. In the absence of a soils report, we know no reason why the subject parcels would not support the proposed master-planned residential development. In addition to being physically possible, we feel that the unique physical characteristics of the site actually enhance the proposed development.

2.

Legally Permissible: The subject is zoned T-D, Traditional Development, by the city of Las Vegas. The purpose of the T-D District is to provide for the development of comprehensively-planned mixed-use communities, with a minimum of forty contiguous acres of land under one ownership or control, which can provide a balanced mix of residential, commercial and civic uses. More detailed plans have been submitted for the subject, outlining the specific uses and unit densities for individual parcels.

3.

Financially Feasible: Among the physically possible and legally permissible uses, the uses which have proven market acceptance should be investigated. Demand for a residential planned development is strong. The Residential Market Overview section of this report contains conclusions on supply and demand prospects for the subject property. Based on market data of comparable land sales, the property has proven to be financially feasible.

4.

Maximally Productive: The maximally productive use of the site must be analyzed in terms of market acceptability. The subject site is located in an ideal location for the development of a planned residential community. The unique features of the terrain provide the site with an assortment of development opportunities, allowing for the capture of available view amenities. Provided that the project is developed in accordance with the current plans, we believe that the subject site's maximally productive use is for a planned residential community.

We conclude that a master planned residential community is the highest and best use of the site as vacant.

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Highest and Best Use

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HIGHEST AND BEST USE AS PROPOSED The proposed development plan for the subject property consists of 218.48 salable acres of residential planned development. The specific plans for the areas being developed indicate a design quality and development standard commensurate with that of the primary competing planned communities which should assure a favorable acceptance in the market for the mix of products being offered. After consideration of alternative uses has been studied, we believe that the proposed plans and existing areas as improved (partial site improvements) for the bulk of the parcels to be developed within the subject property represent the highest and best use of the property.

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Appraisal Process & Methodology

28

APPRAISAL PROCESS & METHODOLOGY The appraisal process represents a logical analysis of the factors that bear upon the present value of real estate. In this process, three basic approaches are typically used by the appraiser: (1) Cost Approach; (2) Direct Sales Comparison (Market) Approach; and (3) The Income (Development) Approach. The Cost Approach is based upon the proposition that an informed purchaser would pay no more than the cost of producing a substitute property with the same utility as the subject. First, the subject site is valued (as if vacant) by comparing it to the sale of similar sites using the Direct Sales Comparison Approach. The replacement cost new is then estimated for the subject improvements, and from this, an amount is deducted for depreciation from all causes to arrive at a value via the Cost Approach. The Direct Sales Comparison Approach is based upon the proposition that an informed purchaser would pay no more for a property than the cost to him of acquiring a similar property with the same utility. In this approach, similar properties that have recently sold are compared to the subject. Notable differences in the utilized comparable sales are adjusted to the subject in the process. Comparisons made are typically based upon age, location, size, financing, physical characteristics and terms of sale. The value range indicated by the adjusted comparable sales is correlated or reconciled into a final value estimate via this approach. The Income (Development) Approach is the process in which the anticipated flow of future benefits (dollar income or amenities) is discounted to a present worth figure through a capitalization or direct discount procedure. All expenses attributable to the real estate are deducted from an effective gross income estimate to arrive at forecasts of applicable net income streams. The net income streams are then "capitalized" or discounted into value at market derived rates. In a land development project, the effective gross income is derived from the sale of land parcels to other developers and builders. A detailed explanation of the exact methodology used in this approach is presented on the following pages of this report. Because of the unique nature of the property, we have used the Development Approach to estimate the as-is value of the land contained within the subject property. Elements of the Direct Comparison and the Cost Approaches are incorporated in the Development Approach. With the use of a computer model, we have combined aspects of all three approaches to derive the requisite values of the fee simple interest in the subject property (as stipulated in the transmittal letter) as of August 1, 2017. The following pages discuss the methodology and assumptions used in our valuation. In the valuation of the subject, we have surveyed the local market for pricing and sale information for of properties that have similar characteristics as the subject. Rather than valuing the subject as one contiguous 218.48-acre parcel, we have broken it up into various land use categories and assigned an estimate of value to each individual land use.

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The comparable land uses analyzed include: Land Use Single-family residential Charter School/Community Amenity Bulk Acreage We have conducted a thorough search of the greater Las Vegas valley market by utilizing public records and local real estate professionals familiar with the market, to locate the sales most comparable to the subject. Adjustments were then made for changes in market condition, location and other physical characteristics of the comparable properties to derive a value estimate for that land use type. Given the land pricing trends in the Las Vegas Valley and the potential for varying levels of premiums associated with potentially gated and other portions of the site, land sales data alone was not adequate to price the subject acreage. Given this, we also prepared land residual analyses for each single family parcel based upon end-product characterizations prepared by both the developer and RCG Economics. Information relating to end product type, unit densities, sizes and pricing were used in order to estimate a reasonable residual to the land for each parcel. These benchmark values were then applied to the various land components presented in the master-plan for Skye Canyon Phase 2. These values are then inflated to a future value that reflects the market appreciation for land in the greater Clark County area. We have estimated the period in which each portion of the subject will be sold by taking advice from the absorption analyses prepared by RCG Economics and also considering from the developer’s pro forma. The future market value is inflated to this point in time then discounted back to the present worth at a discount rate appropriate for this type of investment.

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Development Approach

DEVELOPMENT APPROACH In the development approach, the land was priced as finished lot parcels of land as if sold to merchant builders. Given the nature of the subject (e.g. a planned community with its own product identity and, to a certain extent, exclusive amenities) as well as current market conditions, we have opened up the scope for our data collection to land sales within other areas of the Las Vegas Valley. This appraisal only considers the portions of Skye Canyon Phase 2 which are deemed salable. Given this, the land planned for parks and open space have not been valued herein. The premise is that land will be sold on a finished lot basis to merchant builders. In turn, the builders would be not be responsible for in-tract finishing and will only need to address the “vertical” development of the site and requisite landscaping to market levels. The following pages summarize and explain the methodologies and processes used in determining the value for each individual land use. In general, however, we have analyzed the price per acre but have also considered the influence of the price per dwelling unit for planed end-product, to the extent it is currently available. We have drawn upon sales of builder-ready land throughout the greater Las Vegas valley, with an emphasis on the north and northwestern areas, and have also prepared residual analyses for each product type. The net result is parcel-by-parcel pricing drawing upon information from both the developer and the RCG Economics report recommendations and price point suggestions. Ultimately, we present a table summarizing our pricing conclusions by parcel and in the aggregate. The cash flow model used to determine an estimate of value for the subject property is found at the end of this section. SINGLE FAMILY - LAS VEGAS VALLEY LAND SALES Individual value estimates were derived for each single family land use type which were varied on a parcel-by-parcel basis for planned units densities, lot sizes, and end product pricing by employing a sale comparison approach for residential land. As indicated earlier, we attempted to find comparable sales located in similar master-planned communities offering similar amenities as the subject. Because no two parcels of land are identical, various adjustments to the comparable sales were needed to estimate value conclusions for the subject. To determine market values for the single family residential components of the project (effectively the entire site), the local market was researched in an effort to locate residential land sales. Proprietary data services, public records and local real estate professionals were utilized in order to locate comparable sales. Our primary objective in obtaining comparable land sales was to identify projects which were considered to be comparable to the subject site. The following table summarizes the key information regarding the comparable sales used in the analysis. Where practical, maps have been included to illustrate the locational relationships between the land data and the subject property. It is imperative to note that we have focused our search on detached product land sales. Also of note is that we have included two closed sales from Skye Canyon Phase 1.

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32

Development Approach SINGLE FAMILY RESIDENTIAL LAND SALES SUMMARY No.

Date of

Size

No. of

DU's/

Sale

(Acres)

Units

Acre

Location

1

WS Sky Vista @ Charleston

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

Eagle Nest Peak St., WO Cliff Shadow s Warm Springs, N. Water SEC Water St., Cadence View SS E. Serene Ave., EO Grand Cyn. Windmill Lane NO Strada Cassano, WO LLV Parkw ay Sunridge Ht. Pkw y., SO Horizon Ridge SWC Grand Cyn., Horse (Ph. I Pcl. 1.2) Commerce St,. W. Rome Bl. SWC Bradley, Sheleheda NEC Jones, Horse Dr. NWC Grand Cyn., Gr. Teton (Ph. I Pcl. 1.4) WS Shaumber, NO Dorrell SEC Ann Road, Bruce St. SS Farm Road, EO Hualapai Losee Rd., Tropical Pkw y.

Mar-17

37.26

237

Jan-17 Nov-16 Oct-16 Jul-16 Jul-16 May-16 Apr-16 Jan-16 Dec-15 Sep-15 May-15 Mar-15 Jan-15 Available Available Available

21.15 10.93 10.74 18.00 15.00 22.07 20.06 37.99 10.09 16.37 19.71 33.30 18.15 18.96 20.00 15.30

173 86 49 145 67 85 201 191 100 77 76 204 104 105 120 95

Purchase Price Total

6.4 $24,084,350 8.2 7.9 4.6 8.1 4.5 3.9 10.0 5.0 9.9 4.7 3.9 6.1 5.7 5.5 6.0 6.2

$10,500,000 $3,970,800 $3,651,600 $8,277,200 $5,675,000 $7,980,000 $10,030,000 $13,566,371 $3,985,000 $5,120,000 $6,150,000 $11,763,500 $7,400,000 $5,000,000 $8,500,000 $6,500,000

Per Acre

Per Unit

$646,386

$101,622

$496,454 $363,294 $340,000 $459,844 $378,333 $361,577 $500,000 $357,104 $394,945 $312,767 $312,024 $353,258 $407,713 $263,713 $425,000 $424,837

$60,694 $46,172 $74,522 $57,084 $84,701 $93,882 $49,900 $71,028 $39,850 $66,494 $80,921 $57,664 $71,154 $47,619 $70,833 $68,421

Single Family Land Sales Analysis After making adjustments to the comparable sales for changes in market conditions, location characteristics, amenity influence, and other physical characteristics, we have made conclusions for the various residential land uses and applied them to their respective acreage. Adjustments were made to each of the product type categories to reflect differences in product density, pricing, and amenities. As indicated in the previous table, 17 residential land sales were identified which occurred between January 2015 and the current date. An analysis of the key residential land categories is presented below. Data 9 and 13 are situated in Skye Canyon Phase 2, as these generally represent the most comparable data. The remainder reflect homebuilder tracts in varied areas of the Las Vegas valley, none of which are in a strong master-planned setting. Overall the sales data ranged from a low of $263,713 to a high of $646,386 per acre. The average pricing of all the sales data equated to $399,838 per acre. Sale 2, representing the lower end of the range, relates to is the current offering of a builder parcel planned for a small lot subdivision with no community identity in an inferior locale. Conversely, Sale 1 represents the upper end of the range of sale prices and reflects the sale of finishgraded lots and not a builder pod per se. We understand profit participation is expected for the Skye Canyon land sales, as well as assumption reimbursement of SID assessments. We do not have information on the forecast for profit participation but note that this has been a pricing factor to varying degrees over the past 10-15 years. Under current market conditions, we do not anticipate profit participation to be a material pricing issue. The assumption of SID assessment is implicit in our analysis and further assume all sales would be similarly

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Development Approach

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burdened, be it by SID costs or direct developer costs. Further, we assume such assessments would be passed on to the end-product purchasers (homeowners). We note that detailed information regarding end-product (unit sizes, pricing tiers, target buyers, etc.) was not readily available. Despite this, we were able to obtain or estimate the approximate unit densities. Based upon this, we were able to observe a fairly good correlation between the proposed unit density and the price per planned unit. The following chart illustrates this.

Based on the preceding, we would expect the pricing for the ‘conventional’ SFR land, with unit densities in the mid-to-upper five units per acre range, to fall between $60,000 and $70,000 per planned unit. The Mature Couple-Family-Luxury SFR land, with a ratably lower planned density, would be expected to yield a higher per-unit price. In our analysis of the comparable data, we have given great consideration to the recent pricing trends, unit densities, and the overall locational and related amenities of the subject. Despite the preceding, despite conceptual end-product definition at present, parties currently focus on the price per acre metric versus the price per planned unit. This is well illustrated in the three pending sales which reflect higher prices per acre clustering closely near $360,000, with some noted variances for ‘value’ product types (Parcels 2.27 and 2.29). SINGLE FAMILY RESIDUAL ANALYSES In this section, we explore that price per planned unit metric despite recent experience that buyers and sellers have been focusing on the price per acre. The residual analysis allows us to better reflect the pricing levels and anticipated dwelling unit yields under the Skye Canyon Phase 2 development plan. Hence, a residual analysis premised on the finished product, and the costs to complete such product, provide a cross-check and another tier of support for our pricing conclusions.

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Development Approach

In this analysis, we have drawn advice from the product counts and price point suggestions as presented in the RCG Economics (RCG) report in order to estimate the end-product types and potential as-complete proceeds for each parcel. We also underscore the actual pricing for this parcel, which is generally on-par with the other SFR sites within the competitive market. We have then estimated the all-in costs to develop each site from the finished lot condition. Such costs include hard and soft ‘vertical’ construction costs, typical tract landscaping and marketing/carrying costs. We have relied upon published cost sources (MVS and Means among others), data from our files, as well as confidential costs data from area homebuilders. Costs have been estimated, in general, by product type on an ‘average’ basis using the mid-point square footage and then moderately varied for material differences in unit density and average pricing. The following table summarizes the key items in the land residual calculations for all the subject residential land offerings. Skye Canyon Phase 2 Las Vegas, Nevada Product

Per Unit Averages

Apx.

Total

Tier

Acres

Units Typ. Pricing Price PSF Area SF Cost PSF Total Cost

Families - Luxury

12.25

53

$387,500

$134

2,900

$110

$319,000

$68,500

Families - Value

19.92

88

$405,000

$119

3,400

$100

$340,000

$65,000

$5,720,000

Mature Couple - Family

17.08

66

$510,000

$222

2,300

$180

$414,000

$96,000

$6,336,000

Residual

Residual $3,630,500

Mature Couple-Family - Luxury

16.94

50

$482,500

$127

3,800

$100

$380,000

$102,500

$5,125,000

Single-Young Couple/Family

28.17

178

$250,000

$152

1,650

$120

$198,000

$52,000

$9,256,000

Young Couple/Family Value

15.12

85

$295,000

$137

2,150

$110

$236,500

$58,500

$4,972,500

Single-Young Couple Value

16.01

127

$260,000

$163

1,600

$125

$200,000

$60,000

$7,620,000

Mature Couple - Family

12.52

96

$300,000

$145

2,075

$110

$228,250

$71,750

$6,888,000

Families - Value

16.76

102

$420,000

$183

2,300

$160

$368,000

$52,000

$5,304,000

Families - Value

19.53

110

$275,000

$145

1,900

$115

$218,500

$56,500

$6,215,000

Families - Value

20.32

100

$355,000

$145

2,450

$110

$269,500

$85,500

$8,550,000

Young Couple/Family Value-Single Story

18.38

122

$337,500

$165

2,050

$125

$256,250

$81,250

$9,912,500

213.00

1,177

Totals

$79,529,500

DEVELOPER BUDGETED REVENUES / CONTRACT SALES The developer has all the unsold residential parcels budgeted at a based sale price of $360,000 per acre. In addition, the sale of parcel 2.15 closed in March and parcels 2.16, 2.23a, 2.23b, 2.27, 2.28, 2.29 and 2.35 are in escrow. The following chart summarizes the developer’s budgeted revenues for SID No. 609, inclusive of contract pricing.

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Development Approach

Skye Canyon Phase 2 Las Vegas, Nevada Assessable Parcel No. Acres 2.14 2.15 2.16 2.17 2.20 2.21a 2.21b 2.23a 2.23b 2.27 2.28 2.29 2.35 Totals/Avg's

TOC Budgeted Revenues Total $/Acre

Units

$/Unit

12.25 19.92 17.08 16.94 28.17 15.12 16.01 12.52 16.76 19.53 20.32 18.38 5.48

53 88 66 50 178 85 127 96 102 110 100 122 -

$4,410,000 $6,282,000 $5,540,400 $6,098,400 $9,961,200 $5,443,200 $5,763,600 $4,757,600 $6,033,600 $5,666,610 $7,620,000 $6,049,998 $750,000

$360,000 $315,361 $324,379 $360,000 $353,610 $360,000 $360,000 $380,000 $360,000 $290,149 $375,000 $329,162 $136,861

$83,208 $71,386 $83,945 $121,968 $55,962 $64,038 $45,383 $49,558 $59,153 $51,515 $76,200 $49,590 N/Ap

218.48

1,177

$74,376,608

$340,428

$63,192

CONCLUDED SINGLE FAMILY LAND PRICING Pending/closed sales have been included at their respective contract amounts. Giving weight to the price per acre metric from the comparable land sales as a market backdrop, we conclude current market pricing for the subject’s remaining ‘conventional’ SFR land at $360,000 per acre. CHARTER SCHOOL / COMMUNITY AMENITY LAND The subject features one parcel planned for charter school use. This is situated on the western side of Shaumber Road in the southwestern portion of Skye Canyon Phase 2. The developer has this parcel in contract at $750,000, or approximately $3.14 per square foot. Nine sales were selected that occurred between October 2014 and May 2017, with one current listing. Prices range from $2.03 to $6.61 per square foot, averaging $3.94. The low end of the range is represented by Sale 1, which is a parcel situate in northern Las Vegas and has mixed surroundings (vacant land and residences of varied tenure). The high end of the range is Sale 7, which is situated in a generally superior area of proximate to the airport and area amenities.

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Development Approach

CHARTER SCHOOL/COMMUNITY AMENITY LAND SALES SUMMARY No. Location

Date of Sale

Use

Size (Acres)

Sale Price

Price/ Acre

Price/ Sq. Ft.

1

Alexander/Jensen

Mar-17

Worship

9.61

$

848,750

$ 88,319

$

2.03

2

1481 E. Lake Mead Parkw ay

May-17

Worship

2.63

$

335,000

$ 127,376

$

2.92

3

Valley Drive at Rosada

Nov-16

Charter School

8.73

$ 1,236,000

$ 141,581

$

3.25

4

Pebble Rd., Torrey Pines

May-16

Charter School

2.33

$

500,000

$ 214,592

$

4.93

5

SEC Simmons, San Miguel

Dec-15

Day Care Ctr.

1.93

$

200,000

$ 103,627

$

2.38

6

4315-4405 Boulder Hw y.

Apr-15

Charter School

5.00

$ 1,000,000

$ 200,000

$

4.59

7

SS Smoke Ranch, EO Buffalo

Jan-15

ALZ Hospital

2.63

$

700,000

$ 266,160

$

6.11

8

5975 W. Rosada Way

Oct-14

Worship

1.98

$

225,000

$ 113,636

$

2.61

9

525 E. El Dorado

Day Care, Worship, School

1.25

$

360,000

$ 288,000

$

6.61

Available

Considering factors of parcel size, use and general location, we conclude the in-contract pricing for Parcel 2.35 ($3.14/SF) to be market-oriented. Hence, it has been included for use within the development analysis presented later herein. Summary of Aggregate Retail Proceeds Based on the analysis set forth in the preceding, the hypothetical aggregate retail proceeds for the subject land, assuming sales as rough-graded builder lots, as of August 1, 2017, is estimated in the following table. The reader is cautioned that this conclusion does not represent the market value of the subject property. Rather, it is the maximum potential amount that can be derived through the sale of individual parcels assuming requisite improvements are completed and the land is available for sale as of the “as-is” date of value.

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Development Approach

Skye Canyon Phase 2 Las Vegas, Nevada Parcel No.

Assessable Acres

2.14 2.15 2.16 2.17 2.20 2.21a 2.21b 2.23a 2.23b 2.27 2.28 2.29 2.35

12.25 19.92 17.08 16.94 28.17 15.12 16.01 12.52 16.76 19.53 20.32 18.38 5.48

Totals/Avg's

218.48

Density

53 88 66 50 178 85 127 96 102 110 100 122 N/Ap

4.33 4.42 3.86 2.95 6.32 5.62 7.93 7.67 6.09 5.63 4.92 6.64 N/Ap

$83,208 $71,386 $83,945 $121,968 $56,973 $64,038 $45,383 $49,558 $59,153 $51,515 $76,200 $49,590 N/Ap

$360,000 $315,361 $324,379 $360,000 $360,000 $360,000 $360,000 $380,000 $360,000 $290,149 $375,000 $329,162 $136,861

$4,410,000 6,282,000 5,540,400 6,098,400 10,141,200 5,443,200 5,763,600 4,757,600 6,033,600 5,666,610 7,620,000 6,049,998 750,000

5.39

$63,345

$341,251

$74,556,608

1,177

Per Unit

Gross Proceeds Per Net Acre

Units

Proceeds

It should be reiterated that our site inspections and review of development plans indicated the moderate potential for premiums for items such as views, cul-de-sacs and corners. Despite this, and given the preliminary nature of marketing of the subject, we have not attempted to quantify and include such potential premiums in our analysis. While we believe that such revenues realistically can and should be achieved, the amount and timing of such are speculative. Hence, we have opted to not included premium and participation revenues in our estimated potential gross proceeds from the sale of land. ABSORPTION OF VACANT LAND The pace at which the land is absorbed has a significant influence on the final value derived in the Development Approach because of a concept referred to as the time value of money. Moderate to large-sized residential development projects such as the subject Skye Canyon Phase 2, where there is a notable amount of risk associated with the cash flow, tend to have higher discount rates than other commercial real estate investments such as an office building or retail center. Also, a longer absorption period will result in a lower overall net present value because the discount rate will generally be larger than the growth rate. After analyzing the historical growth in the Las Vegas area over the past several years, considering the quality of the project and the long-term commitment of the developer to build the finest community of its kind in the Las Vegas area and the long-term, demonstrated success to date, we believe that the bulk of the finished product to be constructed on land that is the subject of this report will be absorbed in roughly five years, with the land being sold within three years. The following table contains our estimates of the annual absorption of the significant land uses contained within SID No. 609:

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Development Approach

ANNUAL LAND ABSORPTION FOR SID NO. 609 (ACRES/ANNUAL PERIOD) Land Sales

Year 1

Year 2

Year 3

Total

Acres Absorbed % of Total Cum. %

124.51 57.0% 57.0%

27.37 12.5% 69.5%

66.60 30.5% 100.0%

218.48 100.0% 100.0%

Our absorption analysis considers only the salable residential acres within Skye Canyon Phase 2. The sales estimates as modeled herein indicate that roughly 57 percent of the subject’s acreage will be absorbed in the first year of the analysis period, largely reflective of the three pending sales to date plus three additional parcels. Our estimates for absorption for the residential uses have considered the market recommendations and estimates presented to us by RCG Economics (“RCG”). These items have been reviewed by the appraisers and are expected to be provided to the reader of this report by our client under separate cover. We note that our absorption does not fully tie to the developer’s anticipated timeline for closing of parcels currently in escrow. This is due to our estimation of absorption assuming completion of in-tract (and SID) improvements as well as our view of end-product demand. After weighing numerous factors that influence the absorption rates of similar projects, we determined that the land contained within the subject property will be absorbed over the course of three years. This does not mean that a similar percentage of the project will be developed and completed within this timeline. However, the land will have been sold to other developers or merchant builders in this time frame. In general, we will tend to “sell” the subject land within the DCF analysis, on an overall average basis, roughly twelve to eighteen months ahead of the home construction commencements and closings as forecast in the absorption study. For reference, the RCG study is premised on the assumption that all parcels will have been sold to builders by the end of 2018 and that initial construction starts would begin between in September 2017 through June 2019 (initial phases of individual home tracts). We note that the RCG study shows roughly 97% of the finished units in Skye Canyon Phase 2 as being absorbed within a five-year period. We also observe that the RCG report has an extended absorption period for the Mature Couple/Family-Luxury, SingleYong Couple/Family and Single/Young Couple-Value products. These appear, in part, r reflective of the large number of units as they related to these products (355 in total among three parcels). The absorption was also extended for the Mature Couple/Family Luxury produce although only 50 such units are anticipated. This appears due to the fact that this is the largest planned product in Skye Canyon Phase 2 and the second highest forecast price point. While we believe these extended forecast may be somewhat conservative, we also believe longer-term price movements may offset, or perhaps enhance, the ultimate retail proceeds. Despite this observation, measurement of such impacts is outside the scope of this analysis.

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DEVELOPMENT COSTS After estimating the potential revenues of the development, we have deducted the costs of constructing the basic infrastructure and readying the land for sale to merchant builders. Development costs associated with this project include various planning and design fees; the construction of major parkways and roadways; construction of water and sewer pipes; storm drains; in-tract improvements; rough and finish grading; and numerous marketing, advertising, and general and administrative costs. According to information provided by the Developer, the estimated amounts spent through May 2017 were deducted from the total cost estimates and not modeled in our discounted cash flow. We have relied upon the estimates provided by the developer to determine the amount of development costs that cover the major infrastructure needed to prepare the land included in the subject property for sale to merchant builders. We have analyzed these figures for reasonableness and have determined through conversations with other developers and our own past experiences with similar projects that these estimates appear to be reasonable. Because the cost information provided by the developer includes costs eligible for reimbursement by the SID and additional costs to be borne by the developer, we have added back $10,409,877 million in estimated SID reimbursements for costs to be incurred and ultimately reimbursed from the net SID bond proceeds. The SID costs are passed on to the merchant builders and eventually the end user of the property; therefore, we would be understating the value to the developer if we treated these costs as the responsibility of the developer. We have included amount to carry the bonds through the final sellout of the land, with the understanding that the no interest will be capitalized (which can have the effect of reducing both the periodic expenses in the first and possibly second analysis years and the overall amount of expense reimbursement). Property tax carry has been estimated using the actual tax rate of 3.2782% and the assessment ratio of 35%. We used an estimated “bulk” partially-improved value of $150,000 per acre as an assumed starting assessment (generally premised the “bulk” DCF analysis) and added the hard development costs for each period. The total amount of property taxes for each period further reflects the sell-off of acreage over the analysis period. Marketing and closing costs were estimated at a combined 1.5 percent of periodic land sale revenues. We have also included a developer's profit estimate in our analysis. We have treated the developer's profit as the amount of money required to motivate a developer to forego other activities and to provide a return commensurate with the risk involved in the development. A development such as Skye Canyon Phase 2 requires substantial attention and bears considerable risk. The expenses estimated by the developer include a developer's profit in most cases. For the purposes of our study, we have chosen to add an additional developer's profit of 5.0 percent of all revenues. For purposes of

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Development Approach

41

comparison, prior surveys published in PwC Real Estate Investor Survey indicates a range of developer fees and profits ranging from 1.0 to 6.0 percent, with a mean of 3.5 percent. In more recent periods, analysts have reduced their reliance on profit as a specific line item, focusing on the overall yield (IRR) from a development program. As we believe profit is necessary to attract and motivate a developer, we have included it as a separate line item, however we have also considered its impact in the final yield indicated by our analysis. DISCOUNT RATE The discount rate is defined by the Appraisal Institute in their publication entitled, The Appraisal of Real Estate, as: "A rate of return on capital used to convert future payments or receipts into present value." The discount rate should reflect the risk/reward relationships attendant to the estimated income stream and property strength, supply/demand indicators and anticipated economic trends. The final element of the discounted cash flow analysis is the development of a discount rate. The discount rate used in our analyses reflects time, risk, and return for this project. In order to determine an appropriate discount rate for the subject property, we have analyzed the investment rate parameters stated in the 2nd quarter 2016 RealtyRates.com Developer Survey. The survey stated that discount rates for residential development projects, with no developer’s profit deduction as a line item expense, ranged from 13.57% to 51.29%, with a survey mean of 32.59%. We also queried the 2nd quarter 2017 PwC Real Estate Investor Survey. The survey stated that unleveraged discount rates for land development projects, including developer’s profit, ranged from 10.0% to 20.0%, with a survey mean of 16.00%. Surveys of southwest region developers/homebuilders revealed that most are predominately concerned with equity yields rather than property discount rates, and that equity yields (internal rates of return) of 15% to 25% plus are necessary to attract investment capital. An important consideration of the quoted target internal rates of return is that most of the developers/homebuilders surveyed are basing these on a finished lot to finished home product in tract projects. Thus, the development spectrum is not as wide and risk increases with the implementation of a land improvement program in addition to homebuilding. Further, a longer holding period prolongs market exposure, placing upward influence on the internal rate of return. Based on the information presented above, we have used a discount rate of 16.0 percent, giving weight to the in-place development, marketing and sales teams. We believe the personnel and related experience serves to reduce the level of risk associated with the project. This is demonstrated in a number of ways including: the large number of entitlements related items which have successfully been processed; the amount of regional and tract-specific planning and engineering which has taken place; and active, experienced project management and marketing teams, among others. The concluded discount rate results in an internal rate of return of 20.40%, which is sufficient to attract investment capital.

Continental Realty Advisors: Full Service Real Estate Appraisal & Consulting (949) 221-0975

Development Approach

42

We have also included an appreciation rate equal to an anticipated cost of living index of 3.0 percent to all the land uses. In the past 20 years we have seen annual inflation rates as high as 13.5 percent per year. We recognize that inflation rates have been modest in recent years due to the weak economic recovery and the historic low interest rate environment. In spite of the low inflation levels, appreciation rates in the residential sectors have been good across the nation, with variances between markets. Growth in land prices has been increasing in the past two years. We believe that the current competitiveness in the homebuilding arena will continue over the span of this analysis, resulting in more moderate appreciation rates. Since abnormally high growth rates are not deemed sustainable and not likely to occur again soon, we have conservatively estimated a long-term appreciation rate at 3.0 percent. CONCLUSION Based upon the discounted cash flow analysis presented on the following page, we have concluded to an as-is market value for SID No. 609 in its entirety of $41,240,000 as of August 1, 2017 for the subject by the development approach. This overall value is summarized as follows:

Continental Realty Advisors: Full Service Real Estate Appraisal & Consulting (949) 221-0975

ACRES

CURRENT MARKET VALUE $/ACRE TOTAL VALUE

5.53 5.53 5.53 5.53 5.53 5.53 5.53

19.920 55.780 48.810

315,361 344,396 337,181

6,282,000 19,210,398 16,457,810

27.37 61.12

360,000 360,000

9,853,200 22,003,200

OTHER LAND Parcel 2.35 (Charter School)

N/Ap

5.48

136,861

750,000

TOTAL REVENUES

5.39

218.48

341,251

AVERAGE DENSITY RESIDENTIAL PRODUCT PRESOLD LAND FIRST PERIOD LAND SALES SECOND PERIOD LAND SALES THIRD PERIOD LAND SALES FOURTH PERIOD LAND SALES FIFTH PERIOD LAND SALES SIXTH PERIOD LAND SALES

ACRES SUBJECT TO ASSESSMENT

P.W. FACTOR

315,361 349,562 347,372 0 382,091 387,822 0

6,282,000 19,498,554 16,955,247 0 10,457,827 23,703,695 0

0 1 2 3 4 5 6

1.00000 0.92593 0.85734 0.79383 0.73503 0.68058 0.63017

6,282,000 18,054,217 14,536,392 0 7,686,815 16,132,337 0

143,113

784,259

3

0.79383

622,570

74,556,608 355,555 1

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