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Tax Matters In the opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, based upon existing laws, regulations, rulings and court decisions, and assuming (among other things) compliance with certain covenants, interest on the Bonds is exempt from State of California personal income taxes, although interest on the Bonds is not excluded from gross income for federal income tax purposes. Bond Counsel express no opinion regarding any other tax consequences caused by the ownership or disposition of, or the accrual or receipt of interest on, the Bonds. A copy of the proposed opinion of Bond Counsel is set forth in Appendix D hereto. Circular 230 Disclaimer This official statement contains advice with respect to federal tax issues. Some of that advice, including all of the federal tax advice contained in the form of bond counsel opinion attached hereto, concerns only the excludability of interest on the Bonds from gross income under section 103 of the Internal Revenue Code of 1986 (the "Code ") and original issue premium and /or discount on the Bonds. With respect to all advice related to original issue premium and /or discount on the Bonds the following apply: (a) The advice was not intended or written to be used and cannot be used by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer; (b) The advice was written to support the promotion or marketing of the transactions or matters addressed by this official statement; and (c) Each taxpayer should seek advice based on that taxpayer's particular circumstances from an independent tax advisor. ERISA Considerations Section 406 of the Employee Retirement Income Security Act of 1974, as amended ( "ERISA ") and Section 4975 of the Code, prohibit employee benefit plans ( "Plans ") subject to ERISA or Section 4975 of the Code from engaging in certain transactions involving "plan assets" with persons that are "parties in interest" under ERISA or "disqualified persons" under the Code (collectively, "Parties in Interest ") with respect to the Plan. ERISA also imposes certain duties on persons who are fiduciaries of Plans subject to ERISA. Under ERISA, any person who exercises any authority or control respecting the management or disposition of the assets of a Plan is considered to be a fiduciary of such Plan (subject to certain exceptions not relevant here). A violation of these "prohibited transaction" rules may generate excise tax and other liabilities under ERISA and the Code for fiduciaries and Parties in Interest. The Underwriters, as a result of their own activities or because of the activities of an affiliate, may be considered Parties in Interest, with respect to certain plans. Prohibited transactions may arise under Section 406 of ERISA and Section 4975 of the Code if Series 2012 Bonds are acquired by a Plan with respect to which any Underwriter or any of its affiliates are Parties in Interest. Certain exemptions from the prohibited transaction rules could be applicable, however, depending in part upon the type of Plan fiduciary making the decision to acquire a Bond and the circumstances under which such decision is made. Included among 35