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Director Memorandum No. 18-022                                                     Page 14 of 22



               North Fork Water Company, San Bernardino Superior Court Case No. SCV 165493; or City of
               San Bernardino v. Fontana Water Company, San Bernardino Superior Court Case No.17030
               (January 28, 1924).  It is the intention of the Parties in forming the GC to apply, administer, and
               conform to the requirements and provisions of each of these judgments.  In the event of any
               conflict between the actions of the GC, and the requirements and provisions of such judgments,
               the latter shall control.

                              8.4    No  Admissions.   Nothing  in  this  Agreement  shall  be  construed  as  an
               admission by any Party regarding any subject matter of this Agreement, including but not limited
               to the water rights or priorities of same of the Parties.

                              8.5    Preservation  of  Rights.    The  Parties  agree  that  this  Agreement,  to  the
               extent allowed by law, preserves all rights of the Parties as they may exist as of the Effective Date
               of this  Agreement.   Nothing  in  this  Agreement  is  to  be  construed  as  altering  the  priorities  or
               entitlements of water right holders among themselves to water from the Santa Ana River or the
               Basin.

                       9.     MISCELLANEOUS

                              9.1    Authority.    Each  signatory  of  this  Agreement  represents  that  s/he  is
               authorized to execute this Agreement on behalf of the Party for which s/he signs.  Each Party
               represents that it has legal authority to enter into this Agreement and to perform all obligations
               under this Agreement, and that by doing so, such Party is not in breach or violation of any other
               agreement or contract.

                              9.2    Amendment.    Except  as  to  fluctuations  in  the  Equitable  Allocation  as
               otherwise provided for herein, this Agreement may be amended or modified only by a written
               instrument approved by an eighty (80)%) vote of the Equitable Allocation

                              9.3    Jurisdiction  and  Venue.  This  Agreement  shall  be  governed  by  and
               construed in accordance with the laws of the State of California, except for its conflicts of law
               rules.  Any suit, action, or proceeding brought under the scope of this Agreement shall be brought
               and maintained to the extent allowed by law in the County of San Bernardino, California.

                              9.4    Headings.  The paragraph headings used in this Agreement are intended
               for convenience only and shall not be used in interpreting this Agreement or in determining any
               of the rights or obligations of the Parties to this Agreement.

                              9.5    Construction  and  Interpretation.    This  Agreement  has  been  arrived  at
               through negotiations, and each Party has had a full and fair opportunity to revise the terms of this
               Agreement.  As a result, the normal rule of construction that any ambiguities are to be resolved
               against the drafting Party shall not apply in the construction or interpretation of this Agreement.

                              9.6    Entire Agreement.  This Agreement constitutes the entire agreement of the
               Parties with respect to its subject matter, and supersedes any prior oral or written agreement,
               understanding, or representation relating to the subject matter of this Agreement.


                              9.7    Partial  Invalidity.    If,  after  the  date  of  execution  of  this  Agreement,  any
               provision of this Agreement is held to be illegal, invalid, or unenforceable under present or future
               laws or adjudicatory decisions effective during the term of this Agreement, such provision shall
               be fully severable.  However, in lieu thereof; there shall be added a provision as similar in terms





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