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E-2 <br />2. The City has the power to enter into the Agreement and perform the obligations on <br />its part to be performed that are contained therein. <br />3. The Agreement has been duly authorized, executed and delivered by the City, and is <br />a valid and binding obligation of the City, enforceable against the City in accordance with its <br />terms. <br />4. The portion of the Rental Payments designated as and comprising interest is <br />excluded from gross income for federal income tax purposes and is not an item of tax preference <br />for purposes of the federal alternative minimum tax. The opinions set forth in the preceding <br />sentences are subject to the condition that the City comply with all requirements of the Code that <br />must be satisfied subsequent to the delivery of the Agreement in order that such interest be, or <br />continue to be, excluded from gross income for federal income tax purposes. The City has <br />covenanted to comply with each of such requirements. Failure to comply with certain of such <br />requirements may cause the inclusion of such interest in gross income for federal income tax <br />purposes to be retroactive to the date of delivery of the Agreement. <br />5. The portion of the Rental Payments designated as and comprising interest is exempt <br />from personal income taxation imposed by the State of California. <br />We express no opinion regarding other federal tax consequences arising with respect to the <br />Agreement, the ownership, sale or disposition of any interests in the Agreement, or the amount, <br />accrual or receipt of interest with respect to the Agreement. <br />The rights of Lessor and the enforceability of the Agreement are limited by bankruptcy, <br />insolvency, reorganization, moratorium and other similar laws affecting creditors' rights <br />heretofore or hereafter enacted and may also be subject to the exercise of judicial discretion in <br />appropriate cases. <br />This opinion is given as of the date hereof, and we assume no obligation to revise or supplement <br />this opinion to reflect any facts or circumstances that may hereafter come to our attention, or any <br />changes in law that may hereafter occur. Our engagement with respect to this matter has <br />terminated as of the date hereof. <br />Respectfully submitted, <br />A Professional Law Corporation <br />317