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HomeMy WebLinkAbout96-13 FA Resolution RESOLUTION NO. FA 96-13 A RESOLUTION OF THE OLD TOWN/WESTS]IDE COMMUNITY FACILITIES DISTRICT FINANCING AUTHORITY APPROVING A CONSTRUCTION MANAGEMENT AND SUPERVISION AGREEM[ENT WITH FLUOR DANIEL, INC. AND A GUARANTEE WITH FLUOR CORPORATION THE BOARD DIRECTORS OF THE OLD TOWN/WESTSIDE COMMUNITY FACILITIES DISTRICT FINANCING AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS: Section 1. The Board Directors of the Old Town/Westside Community Facilities District Financing Authority ("Authority") does hereby find, determine and declare as follows: a. The Authority has authorized the issuance of the Old Town/Westside Community Facilities District Financing Authority Community Facilities District No. 1 (Old Town Area Public Improvements) 1996 Special Tax Bonds" to fund the construction of certain public improvements in the Old Town Area ("Public Improvements"). b. Anticipating the need for a construction manager to supervise and manage the construction of the Old Town Area Public Improvements, and prior to the formation of the Authority, the City of Temecula and the Redevelopment Agency of the City of Temecula circulated requests for proposals for construction management services for this project to four of the largest construction management firms in Southern California, in accordance with the authority of Government Code Sections 4526 and 4528. C. Proposals were received from Centex Golden Construction Company, Fluor Daniel, Inc., Kajima International, Inc., and Snyder Langston. d. The proposals were evaluated on the basis of demonstrated competence and on the professional qualifications necessary for the satisfactory performance of the construction management services required for the Public Improvements in accordance with the authority of Government Code Section 4526. e. On April 25, 1996, the Board authorized the City Manager/Executive Director to initiate negotiations with Fluor Daniel, Inc. for construction management services for the Old Town Area Public Improvements as specifically authorized by Resos.FA\96-13 Government Code Section 4528, determining that Fluor Daniel, Inc., was the best qualified firm to perform construction management services for the Public Improvements. f. In accordance with the provisions of Government Code Section 4528, the City Manager/Executive Director has negotiated the terms of the Construction Management and Supervision Agreement ("CMSA") on behalf of the Authority. 9. In accordance with the provisions of Government Code Sections 4526 and 4528, the Board finds that Fluor Daniel, Inc., is the best qualified firm to perform construction management services for the Old Town Area Public Improvements. h. All contracts for construction of the Public Improvements will contain a clause requiring the contractor to pay prevailing wages in accordance with Labor Code Sections 1700, et seq. i. The CMSA requires public bidding of all components of the project for which competitive bids are required by California law, in accordance with the specific bidding procedures set forth in Exhibit A to the CMSA. The bidding procedures set forth in Exhibit A are in general compliance with the applicable provisions of the Public Contracts Code for cities. The Board finds that to the extent competitive bidding in accordance with the Public Contracts Code is required for the Public Improvements, strict compliance with the applicable provisions of the Public Contracts Code would be unavailing and would not produce an advantage, and the advertisement for competitive bids would thus be undesirable, impractical, and impossible. The land use approvals for the Old Town Entertainment Project require completion of the Public Improvements prior to the issuance of a certificate of occupance for the Project. The Public Improvements will in many areas be constructed adjacent to the Project and will affect access to the Project during construction, thus requiring a close coordination between the contractors working on the Project and the Public Improvements. The procedures set forth in Exhibit A of the CMSA do in fact provide for public bidding as the construction manager is required to obtain six to eight competitive bids for each matter to be bid and the bid shall be awarded on the basis of the highest quality and lowest price for the Authority. Section 2.The Board of Directors of the Old Town/Westside Community Facilities District Financing Authority hereby approves those certain agreements relating to the management of the construction of the Public Improvement entitled (1) "Construction Management and Supervision Agreement Between the Old Town/Westside Community Facilities District Financing Authority and Fluor Daniel, Inc., a California corporation," (2) the "Supplemental Letter Agreement" between the Old Town/Westside Community Facilities District Financing Authority and Fluor Daniel, Inc., a California corporation, and (3) the "Guarantee" between the Old Town/Westside Community Facilities District Financing Resos.FA\96-13 2 Authority and Fluor Corporation, a Delaware corporation, all in substantially the forms attached hereto as Exhibits A, B, and C, and directs and authorizes the Chairperson to execute said agreements on behalf of the Authority, subject to such changes in form as may be approved by the Executive Director and the General Counsel. Section 3. The Secretary shall certify the adoption of this Resolution. PASSED, APPROVED AND ADOPTED by the Board of Directors of the Old Town/Westside Community Facilities District Fin4 i" Authority on November 26, 1996. Patricia H. Birdsall, Chairperson ATTEST: Jreek, CMC Authority Secretary/City Clerk [SEAL] Resos.FA\96-13 3 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ss CITY OF TEMECULA 1, June S. Greek, Secretary of the Old Town/Westside Community Facilities District Financing Authority, do hereby certify that the Resolution No. FA 96-13 was duly and regularly adopted by the Board of Directors of the Old Town/Westside Community Facilities District Financing Authority at a regular meeting thereof, held on November 26, 1996, by the following vote, to wit: AYES: 3 BOARDMEMBERS: Birdsall, Ford, Lindemans NOES: 0 BOARDMEMBERS: None ABSENT: 1 BOARDMEMBERS: Roberts ABSTAIN: 1 BOARDMEMBERS: Stone Greek, CMC Authority Secretary/City Clerk Resos.FA\96-13 4 [11119/96 DRAFFJ E~'lmff A FORM OF CERTIFICATE OF DEVELOPER AT PRINTING The undersigned. the [title of authorized representative] of Old Town Ente-~ainment LI~. a DeLaware limited liability company (the 'Develol~-r'), hereby makes the ~ollowing representations, warranties and covenants as of th~ date hereof to find for the benefit of Old Town/Westsid¢ Impwvement Authority (the "Authority") nnd Stone & Youngberg LLC (the "Underwriter"), in connection with the pr/cing of the Old Town/Westside Improvement Authority 1996 Local Agency Revenue Bonds (the *Bonds") (capitalized tin'ms used herein and not otherwise defined shall have the meanings ascribed to them in the Bond Purchase Contract related to th~ Bonds): 1. The Developer is a limited liability company duly formed and validly existing under the laws of the State of Dehware. 2. The Developer is duly qualified to transact business in the Stat~ of California. The Developer has full power and authority to own or lease its property, includinL without limitation, the property on which the Development and Project (as defined in th~ Official Statement) is to be corotmeted (the "Property"), to carry on its business as presently being conducted and as contemplated W be conducted by the [insert names of nmterlnl documents to which D~eloper i~ a partyl, and to execute, deliver, and perform its obligatiom under the foregoing documen~ (collectively, the *Developer Documents°). 3. Attached hereto are fully executed, true, correct and complete copies of the limited liability company agreement of the Developer and a resolution of the Developer authorizing the Developer to enU:r into the Developer Documents. The foregoing documents have not been amended or supplemented and are in full force and effect as of the date hereof. 4. Tbe Developer has pwvided tbe information set forth in the Prel'mainary Official Statement describing the Developer, the Development and Project, and the Underwriter is authorized to use such information in the distribution of the Pre 'hn~nary Official Statement and the Final Official Statement. Such information about the Developer, the Development and Project as presently set forfit in the Preliminary Official Statement is tru¢ ~d correct and does not contain any untrue statement of material fact or omit to state any fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which ~uch statements were nande, not misleading in any material respect. 5. Except as set forth in the Prel'uninary Official Statement, there is no action, suit, proceeding, inquiry or investigation by or before any court, governmental agency, public board Exhibit A Page 1 [L,2S2424.S] [11/19/96 or body pending or, to the best of the Developer's knowledge threatened against the Developer (nor, to the best of fi~e Developer's knowledge, is there any basis therefor), which (i) affects or seeks to prohibit, restrain or enjoin the issuance, sale or delivery of the Bonds or the use of ~e Prelhninary Official Statement or the execution and delivery of ~he Developer Documents, (ii) affects or questions the validity or enforceability of the Bonds, (iii) questiota the tax-exemp~ s~atus of the Bonds or the completeness or accuracy of ~ Pre 'lunimry Official Statement, or (iv) questiota the power of the Developer to carry out the transactions contemplated by the Developer Documeats or the power of the Developer to own, consuuct, equip or operate its portion of the Developmere. IN WITNGSS WI4~J~OF, the undersized Authorized officer of the Developer has cxecu~! ~ ccrtifica~: and a~rccment this clay of ,1996. OLD TOWN ENTERTAINMENT LLC, a Delaware limited liability company By: [L2S2424, S] Exhibit A Page 2 EXHIBIT B I11/19/96 DP. Xi~ FORM OF CERTIFICATE AND AGI?I~MENT OF DEVELOPER AT CLOSING The undersigned, the [title of authorized repreMntative] of OLD TOWN ENTF. RTAINMF2q'T LLC, a Delaware limit! liability company (fiz "Developer"), hereby makes the following representations, warranties, covenants and ~,~zner~, ~ of the date hereof to and for the benefit of Old Town/Westside Impwvengnt Authority (tbe'Authority") and Stone & Youngberg LLC (the "Underwriter"), in connection with the i~uance and ~ale of $ aggregate principal amount of file Old Town Entertainment/Westside Improvement Authority 1996 Local Agency Rcvenuc Bonds (tl~ 'Bonds") (capitalized terms used herein and not otherwi~ defined shall have tbe mcanin~a~ ascribed to tl~m in the Bond Purchase Contract related to fi~c Bonds): 1. The Develope~ is a limited liability company duly authorized to cxocute and deliver Finserr names of mnterial documents to which Developer is a party] (collectivcly, the "Developer Documents'), and that the signature below is that of a duly authorized representative of the Developer. 2. T'ne Developer is duly qualified to transact business in ~ State of California. The Developer has full power and authority to own or lease its property, including, without limitation, the property on which the Development and Project (as defined in the Official Statement) is to be constructed (the "Property"), to carry on its business ns presently being condugted and as contemplated to be conducted by the Developer Documents, and to execute, deliver, and perform its obligatiom under the foregoing documents. 3. The information about the Developer, the Development and Project contained in the Official Statement, as fi-,e same may be supplemented or areerred with tl~ written approval of the Underwriter and the Developer, is true and correct and does not contain any untrue stztement of material fact or omit to state any fact required to be stated therein or necessary to make the statements therein, in the light of the cixcumsmnces under which such statements were made, not misleading in any material respect. The information submitted by the Developer to the Underwriter in connection with the preparation of the Official Statement was, and is as of this date, true and correct; provided, howcvcr, that the Developer makes no representation as to the accuracy of projected or estimated information provided by the Developer and contained in the Official Statement except to represent that such information is the good faith estimate or projection of the Developer as to the matters set forth therein. [~252424.S] Exhibit B Page I 4. The execution, delivery and performance by the Developer of the obligations contained in the Developer Documents have been duly authorized by all necessary action on the Developer's part. 5. Upon the execution and delivery thereof by the Developer and the other parties thereto, the Developer Documents will constitute legally valid and binding obligations of the Developer, enforceable in accordance with their terms, except as limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws alTecting creditors' fights generally, and except that it makes no representation as to the availnbility of specific performance or other equitable remedies. 6. If at any time, within 90 days from the date hereof, any event shall have occurred which might cause the Official Statement to comain any untrue statement of material fact or omit to state any fact n~_e~sary to make the statements ticrein not mi.~ieading in any material respect, the Developer shall notify the Issuer and the Underwriter. In addition, the Developer shall promptly advise the Underwriter of the institution of any action, suit, proceeding, inquiry or inve.~igation of which he has any knowledge seekin_~ to prohibit, restrain or otherwise affect the use of the Official Statement in connection with ~ offering, sale or distn'bution of the Bonds. The Developer shatl fmrnish the Underwriter any information concerning the Developer which the Underwriter might reasonably request in connection with any amendment of or supplement to the Official Statement. 7. The execution and delivery of the Developer Documents by the Developer and performance by the Developer of its obligations thereunder will not conflict with, or constitute a breach of, or default under any indenture, mortgage, deed of trust, lease, note, commitment, agrecmcnt or other instrument or obligations to which the Developer is a party or by which the Developer or any of its properties is bound, or under any law, rule, regulation, judgment, order or decree to which the Developer or any of its properties are bound which breach might have a material adverse effect on its ability to perform under the Developer Documents. The Developer is not now in material default under any order or decree of any court or any order, regulation or demand of any federal, state, municipal or governmental agency or any document, instrument or commilment to which the Developer is subject or in the payment of the principal of, or premium or interest on, or otherwise in default with respect to, any bonds, notes or other obligatiom which the Developer has issued, assumed or guaranteed as to payment of principal, premium or interest. 8. Except as has been previously disclosed to the Underwriter, there is no action, suit, proceeding, inquiry or investigation by or before any court, governmental agency, public board or body pending or, to the best of the Developer's knowledge threatened agv/nst ~ Developer (nor, to the best of the Developer's knowledge is there any basis therefor), which (i) affects or seeks to prohibit, restrain or enjoin the issuance, sale or delivery of the Bonds or the use of the Official Statement or the execution and delivery of the Developer Documents, (ii) affects or questions the validity or enforceability of the Bonds, (iii) questions the tax-exempt Exhibit B [I~$2424. S] [1111919~ DRAFr] status of the Bonds or the completeness or accuracy of the Official Statement, or (iv) questions the power of the Developer to carry out the transactions contemplated by the Developer Documents or the power of the Developer to own, construct, equip or operate its portion of the Development. 9. The Developer has made all fdings With and received all approvals, consents and orders of any governmental authority, legislative body, board, agency or commission having 'jurisdiction which are necessary to permit the Developer to perform its obligations under the Developer Documents, to commence performance of its obligations under the Developer Documents, to own the Property and cause construction of the Development to commence. 10. Any certif'w, ate signed by an authorized representative of the Developer and delivered to either or both of the Underwriter or the Issuer in connection with the transactions contemplated by the Developer Documents or the Official Statement shall be deemed to be ~ representation and warranty by the Developer to the Underwriter and the Issuer as to the statements made therein. 11. The t~-presentations and warrenties made by the Developer contained in the Developer Documents and in the Certifw, ate of Developer at Printing are true and correct as if made on the date hereof. 12. [The Private Bond Finance Documents (as deftned in the Cextificate of Developer at Printing) have been executed and delivered by the Developer and t~te Private Bond Underwriter named therein and are in full force and effect. The Private Bond Finance Documents are valid and binding agreements of the Developer and are enforceable in accordance with their respective terms. Fully executed copies of the Private Bond Finance Documents have been delivered by the Developer to the Underwriter as of the date hereof.] All conditions precedent to the Private Bond Underwriter's obligation to purchase the bonds ('Private Bonds') offered under the Private Bond Finance (as deftned in the Certifi~te of Developer at Printing) (the "Conditions Precedent"). other than [consider whether any legitimote exceptions]. have been fully performed in accordance with the requirements of the Private Bond Finance Document,. The Develope~ has delivered to the Underwriter evidence of satisfactory completion of all Conditions Precedent to the Private Bond Underwriter's purchase of the Private Bonds. 13. The Developer shall indemni~y and hold ]~lrtnless th~ Undel"writo'T Underwriter's officers, directors, employees, counsel and agents and each person who controls ~ Underwriter within the mennin_a of the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934. as amended (collectively. the "Securities Acts"). against any and all losses. claims. damages. liabilities. costs and expenses (including without limitation fees and disbursements of counsel and other expenses) incurred by them or any of them in connection with investigating or defending any loss. claim. damage. liability or any suit. action or proceeding. joint or several. to which they or any of them may become subject under the Securities Acts. or any other federal or state law or regulation. at common law or otherwise. Exhibit B Page 3 [T"2S:34 2& · [ll/IW~ DtO~I'] insofar a~ such losses, claims. damages, liabilities, costs and expenses (or any suit, action or proceeding in respect thereoO arise out of or are based upon any untnw ~nt or alleged ontme statement of a material fact contained in the Official Statement or in any amendment or supplement thereto. or arise out of or are based upon the oral,ion or alleged omission of a fact required to be stated therein or necessary to make the statements therein. in light of the ¢ircumrtances under which they were made. not misleading; l~rovided. however. that Developer shah not be liable in any such case to the extent that any such loss. claim. damage. liability or action arises out of. or is based upon. (i) any information contained in the 'Underv,-riting~ section of the Final Official Statement. (ii) any information relating to the Authority or the City in the Final Official Statement. or. (iii) information in Appendices [A. B. or F]; and provided further that the Developer shall have no obligation to illdemnify or hold harmle,~ any or all indemnitie~ hereunder for any or all losses, claims, damages or liability that ~trise from or are the result of willful mi.~.onduct by any or nil of ~ indemnities. This inclenmiry shah he in addition to any liability which the Developer may otherwise have. Promptly after receipt by any party entitled to indemnification under ~ paragraph 13 (each, an "Indemnitee") of notice of the commencement of any clnim, suit, action, investigation or proceeding, such Illd~mniteo shall, if a claim in re~OG't thereof is to he made against the Developer under this paragraph 13, deliver to th~ Developer in writing notice of the commencemere the~of; but the omission to so notify the Developer shall not relieve the Developer from any liability which it may have to any Indemnitee otherwise than under thi, paragraph 13 or from any liability under thi.~ paragraph 13 unless the failure to provide notice prejudices the defense of ~ach claim, suit, action, investigation or proceeding. In case any such action is brought against any lndemnitee, and it notifle~ the Developer, the Developer shah be entitled to participate in, and to the extent that it may elect by written notice delivered to the Indemnit~ prol~ptly after receiving th~ afore~tid notice from such Indeumitee, to assulne the defense thereof, with counsel satisfactory to such [lidgranites; provided, however, if the defendant~ in any such action include both the II~demnitee alx[ th~ Developer and the lndemnite~ shall have reasonably concluded that there may be legal defenses available to it and/or other llldemnitees which are different from or additional to those available to the Developer, the Indemnitee or Indemnitees shall have the right to select separate counsel to a~sett such legal defenses and to otherwise participate in the defense of ~uch action on behalf of such lndemnitee or Indenmitees. Upon receipt of notice from the Developer to such Indemnit~e of its election to nssnme the defense of such action and approval by the Indemnltee of counsel, the Developer shah not he liable to such lndemnitee under this paragraph 13 for any legal or other expenses subsequently incurred by such Xndemniteo in conl~ection with defense thereof unless (i) the Indemnitee shall have employed separate counsel in connection with the assertion of legal defenses in accordance with the proviso to the next precedin~ sentence (it being understood, however, that the Developer shall not, in connection with any action indemnified against ~, be liable for the fees and expenses of more than on~ separate finn of attorneys at any point in time t~resenting the Indemnitees to such action), (iO the Developer shall not have employed counsel satisfactory to the lndemnltee to represent the Indemnitee within a reasonable [z.3sa434.s] Exhibit B Page 4 [11/19/9~ DRAFT] time after notice of commencement of the action, or (iii) the Developer has authorized the employmere of counsel for the Indemnitee at the expense of the Developer. 14. [Thg I~veloper has deemed the Ire 'lttnimry Official Statement final as of its date (within the meaning of Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934 ('Rule 15c2-12")), provided, however, that the foregoing representation ~ to f'mality of the form of the Pre 'hmimry Official Statement does not include statements and information contained therein relating to the Authority or the CFD Financin~ Authority. For the 25-day period commencing with the 'end of the underwriting period" (as deftned in Rule 15c2-12), the Developer (i) will not participate in the issuance of any amendment of or supplement to tbe Final Official Statement to which, aftor being furnished with a copy. the Authority, the CFD Financing Authority or tbe Undermiter shah reasonably object in writing or which shall be disapproved by their respective counsel, and (ii) if any event relating to or affecting the Authority, the CFD Financing Authority, the Underwriter, or tl~ Developer or the proposed Development shah occur as a result of which it is ~-ces~qry, in the opinion of coumel for tbe Underwriter, to amend or supplement t!~ Official Stn~-ment in order to make the Official Statement not misleading in the light of the circumstances existing at the time it is delivered to an initial purchaser of the Bonds, the Developer will forthwith prepare and furnish to the Underwriter and the Authority a reasombl¢ number of copies of an amendment of or supplement to tim Official Statement (in form and substance satisfactory to the Underwriter and its counsel) which will amend or supplen~nt the Official Statement so that it will not contain an untn~ statement of a material fact or omit to state & material fa~t ~'cessnry in order to ma~ the statements therein, in the light of the circumstances existing at the ~ the Official Statement is delivered to an initial purchaser, not misledling. All costs of preparing any necessary amc. ~dment or supplemere to the Off~:ial Statement pursuant to this paragraph 14 shah be born~ by ~,~e Developer. For the purposes of this paragraph 14, during the 25-day period the Developer will furnish such information with respect to itself and/or the Project as the Underwriter and the Authority may from time to time reasonably request. The 'end of the underwriting period' (as deftned in Rule 15c.2-12) shall be deemed to be the Closing Date, unless the Underwriter provides to the Developer written notice to the contrary.] 15. There are no clalm,, disputes, suits, actions or contingent liabilities among, by, or between the members of the Developer which would be reasombly likely to have a mnterial adverse effect on the Developer, the Development or the Project. 16. The information furni.~hed tO the Appraiser and the Special Tax Consultant (as such parties are identified in the Official Statement) or to any of the other parties hereto by the Developer for use in the Official Statement, including Appendices [C, D, E and O thereto], was and is true and correct and Developer has no r~ason to believe that any of the assumptions made or used by the Appraiser or the Special Tax Consultant are inaccurate or misleading. 17. All of the real property within the Development, as of the Closing, is owned in fee by the Developer except as identified in the Official Statement. [L253¢24.S] Exhibit B Page $ !llll~l~ DRkir'rJ 18. Add specific representations about the Development andProject, conaruction, IN WITNESS WI~-~OF, the undersigned authorized officer of the Developer has executed thi~ certificate and agreement this ... day of ,1996. OLD TOWN ENTERT~NT LLC a Delaware limited liability company Its: Accepmd and A!p'eed: STONE & YOUNGBERG LI..C Vice President OLD TOWN/WESTSIDE IMPROVEMENT AUTHORITY By: Executive Director Exhibit B Page6 EXHIBIT C [11/19;96 DRAFrJ [date] Old Town/Westside Improvement Authority 43174 Business Park Drive Temecula, California 92590 OPH~'ION: $ Old Town/Westside Improvement Authority 1996 Local Agency Reverme Bonds (Old Town Area) Membe~ of the Board of Directors: We have acted as bond counsel in connection with the issuance by the Old Town/Westside Improvement Authority (the "Authority") of its 1996 Local Agcncy Revenue Bonds (the 'Bonds") pursuant to the Marks-Roos Local Bond Pooling Act of 1985, as amended, and Resolution No. adopted by the Board of Directors of the Authority on · 1996 (ti~ 'Resolution"), an Indenture, dated as of ,1996 (the'Indenture'), by a~l between the Authority and First Trust of California, National Association, u Trustee. We have examined the law and such certified proceedings and other documents as we deem necessary to render this opinion. As to questions of fact material to our opinion, we have relied upon representations of the Authority contained in the Resolution and in the certified proceedings and certifications of public officials and others furnished to us, without unc!~ to verify the same by independent investigation. Based upon the foregoing, we are of the opinion, under existin~ hw, as follows: 1. The Authority and the CFD Financing Authority are duly created and validly exiz~ u joint exercise of powers authorities, with the power to adopt the Authority Resolutions and the CFD Resolutions, enter into tl~ Indenture and Fiscal Agent Agreement and perform the agreements on its part contained therein and issue the Bonds. 2. The Indenture has been duly entered into by the Authority and constitutes a valid and birding obligation of the Authority enforceable upon the Authority. Exhibit C Page 1 [11/19/96 DRAFT] 3. The Fiscal Agent Agreement has been duly entered into by the CFD Financing Authority and constitutes a valid and binding obligation of tbe CFD Financing Authority, enforceable upon the CFD Financin~ Authority. 4. Pumumt to the Act, the Indenture cre~te~ a valid Hen on the fund~ pledged by the Indenture for the security of the 5. Tbe Final Agent Agreen~nt create~ a valid lien on the funds pledged by the Fiscal Agent Agreement for the security of the Local Agency Bonds. 6. Tbe Bond~ and the Local Agency Bonds hnv¢ been duly authorized, executed and delivered by the Authority nnd the CFD Financing Authority, t~pectively, and are valid and binding limited obligation~ of the Authority, payable ~olely from the sourtea provided therefor in the Indenture nnd the Fisc~ Agent A~eement, respectively. 5. The interest on tbe Bonds is excluded from gross income for federal income tax purpo.w.s and is not an item of tax preference for purposes of the federal alternative minimm~ tax imposed on indivi~_-_!_. and corporations; it should be not~d, however, that for th~ purpose of computing the alternative minimum tax in~o~ on corporatiom (a~ defined for federal income tax ~), such interest is taken into account in dctefminin_o colrain ilic. om¢ ILtKI earnings. Ti~ opinions set forth in tbe preceding sentence are subject to the condition that the Authority comply with all requirements of the Internal Revetme Code of 1986 that must be satisfied subsequent to the issunree of the Bonds in order that ~ interest thee. on be, or continue to be, excluded from gross income for federal income tax purpose. The Authority has covenanted to comply with each such requirement. Failure to comply with certain of ~uch re. qui~ments may cause the inclusion of interest on the Bond~ in grou income for federal income tax purpo~$ to be retroactive to the date of is~ance of the Bonds. We express no opinion regarding other federal tax consequences arising with respect to the Bonds. 6. The interest on the Bonds is exempt from personal income taxation imposed by the State of California. The rights of the owners of the Bonds and the enforceability of the Bonds, the Resolution and the Indenture may be subject to bankruptcy, insolvency, reor~nni-n~ion, moratorium and other s'unilar laws affecting creditors' rights heretofore or hereafter enacted and also may be subject to the exercise of judicial discretion in appropriate cases. [l,.2S242¢. S] Exhibit C