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HomeMy WebLinkAbout2014 CON Johnston and Ralph - 726 W 19th Street - Purchase and Sale AgreementPURCHASE AND SALE AGREEMENT (726 West 19th Street, National City, CA 91950) THIS PURCHASE AND SALE AGREEMENT ("Agreement") is dated as of the 17th day of June, 2014 ("Effective Date") by and between Stephen Randolph Johnston, Paul William Ralph and Michelle. Leann Hooper Ralph (collectively, the "Seller") and the City of National City ("Purchaser"). RECITALS A. The Seller owns the fee interest in that certain real property generally located at 726 West 19th Street, National City, California 91950, Assessor's Parcel Number 559-095-09-00, legally described and depicted in Exhibit A attached hereto and made a part hereof ("Real Property"). B. Seller proposes to construct on the Property certain improvements ("Additional Improvements") as described on Exhibit C attached to and incorporated into this Agreement by reference. The Additional Improvements shall be constructed by the Seller in accordance with the Construction Contract that is being entered into between the Seller and Purchaser concurrently herewith ("Construction Contract"). C. Upon completion of the Additional Improvements, Purchaser desires to purchase the Real Property (including without limitation the Additional Improvements, and any all other improvements and fixtures thereon, which shall be referred to collectively herein as the "Property") on the terms, covenants, and conditions contained in this Agreement. D. Provided the various conditions to Closing (as defined below) set forth in this Agreement, including, without limitation, completion of construction of the Additional Improvements, are satisfied, the Seller agrees to sell the Property to the Purchaser and the Purchaser agrees to purchase the Property from the Seller as set forth in this Agreement. Provided, however, the Seller acknowledges and agrees that in order to bind Purchaser to the terms and conditions of this Agreement, this Agreement must be approved by the City of National City. AGREEMENT FOR GOOD AND VALUABLE CONSIDERATION, the receipt and adequacy of which are acknowledged, the Seller and the Purchaser hereby agree as follows: 1. Purchase and Sale. In consideration of the mutual covenants set forth in this Agreement, the Purchaser will acquire all of the Property, on the terms and conditions set forth herein, provided the various conditions to Closing set forth in this Agreement are satisfied. (a) Sale of the Property. The Seller agrees to sell the Property to the Purchaser, and the Purchaser agrees to purchase the Property from Seller, on the terms and conditions set forth herein. At Closing, the Seller shall convey the fee interest in the Real Property to the Purchaser 1 by recordation of the Grant Deed (as defined below). The Escrow Agent shall issue the Title Policy (as defined below) to the Purchaser at Closing. (b) Possession of the Property. The Seller shall deliver possession of the Property to Purchaser at Closing. Possession of the Property shall be delivered to Purchaser subject only to the Permitted Exceptions, all as defined hereinbelow. 2. Definitions. As used in this Agreement, the following terms shall have the following meanings: "Additional Improvements" has the meaning set forth in Recital B, above. "Agreement" means this Purchase and Sale Agreement between the Seller and the Purchaser. "Applicable Environmental Law" means all laws applicable to the presence of any Hazardous Materials (as defined below) on or within the Property, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. §9601, et seq.); the Resource Conservation and Recovery Act (42 U.S.C. §6901, et seq.); the Clean Water Act (33 U.S.C. §2601, et seq.); the Safe Drinking Water Act (14 U.S.C. §300f, et seq.); the Hazardous Materials Transportation Act (49 U.S.C. §5101, et seq.); the Toxic Substances Control Act (15 U.S.C. §2601, et seq.); the Federal Water Pollution Control Act (33 U.S.C. § 1300, et seq.); the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. § 136, et seq.); the Atomic Energy Act (42 U.S.C. §2011, et seq.); the Nuclear Waste Policy Act (42 U.S.C. §10101, et seq.); the Clean Air Act (42 U.S.C. §7401, et seq.); the California Hazardous Waste Control Act (California Health and Safety Code §25100, et seq.); the Carpenter -Presley -Tanner Hazardous Substance Account Act (California Health and Safety Code §25300, et seq.); the Safe Drinking Water and Toxic Enforcement Act ("Proposition 65") (California Health and Safety Code §25249.5, et seq.); and the Porter -Cologne Water Quality Control Act (California Water Code §13000, et seq.); and any similar federal, state or local laws, all regulations and publications implementing or promulgated pursuant to the foregoing, as any of the foregoing may be amended or supplemented from time to time. "Business Day" means any day other than a Saturday, Sunday or any other day on which Purchaser or Escrow Agent is not open for business. In the event any date, deadline or due date set forth in this Agreement falls on a day that is not a Business Day, then such deadline or due date shall automatically be extended to the next Business Day. "Close" or "Closing" means the close of Escrow as provided herein, which shall not be later than the last day of the Due Diligence Period. "Closing Date" means the date on which the Closing occurs. "Conditions Precedent for the Benefit of the Seller" shall have the meaning set forth in Section 6 of this Agreement. 2 "Conditions Precedent for the Benefit of the Purchaser" shall have the meaning set forth in Section 7 of this Agreement. "Deposit" shall have the meaning set forth in Section 3(b)(1) of this Agreement. "Due Diligence Period" means the period of time commencing on the Effective Date and ending on July 15, 2014; provided, however, that the Purchaser shall have three (3) one -month options to extend the Due Diligence Period. Each of those extension options may be exercised by the Purchaser providing written notice of the same to the Seller and Escrow Agent. "Effective Date" is defined above. "Escrow" means the escrow depository and disbursement services to be performed by Escrow Agent pursuant to the provisions of this Agreement. "Escrow Agent" means John Lynn at Ticor Title 2878 Camino Del Rio South, Suite 500, San Diego, California 92108. "Grant Deed" means a duly executed and acknowledged grant deed conveying fee simple title to the Real Property from the Seller to the Purchaser, in substantially the form attached hereto as Exhibit B and made a part hereof. "Hazardous Materials" means: (1) Those substances included within the definitions of "hazardous substance," "hazardous waste," "hazardous material," "toxic substance,f' "solid waste," `pollutant" or "contaminant" in the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. §9601 et seq.); the Resource Conservation and Recovery Act (42 U.S.C. §6901 et seq.); the Clean Water Act (33 U.S.C. §2601 et seq.); the Toxic Substances Control Act (15 U.S.C. §9601 et seq.); the Hazardous Materials Transportation Act (49 U.S.C. §1801 et seq.); or under any other Environmental Laws. (2) Those substances included within the definitions of "Extremely Hazardous Waste," "Hazardous Waste," or "Restricted Hazardous Waste," under §§25115, 25117 or 25122.7 of the California Health and Safety Code, or is listed or identified pursuant to §§25140 or 44321 of the California Health and Safety Code. (3) Those substances included within the definitions of "Hazardous Material," "Hazardous Substance," "Hazardous Waste," "Toxic Air Contaminant" or "Medical Waste" under §§25281, 25316, 25501, 25501.1, 25023.2 or 39655 of the California Health and Safety Code. (4) Those substances included within the definitions of "Oil" or a "Hazardous Substance" listed or identified pursuant to §311 of the Federal Water Pollution Control Act, 33 U.S.C. § 1321, as well as any other hydrocarbonic substance or by-product. 3 (5) Those substances included within the definitions of "Hazardous Waste," Extremely Hazardous Waste" or an "Acutely Hazardous Waste" pursuant to Chapter 11 of Title 22 of the California Code of Regulations. (6) Those substances listed by the State of California as a chemical known by the State to cause cancer or reproductive toxicity pursuant to §25249.9(a) of the California Health and Safety Code. (7) Any material which due to its characteristics or interaction with one or more other substances, chemical compounds, or mixtures, damages or threatens to damage, health, safety, or the environment, or is required by any law or public agency to be remediated, including remediation which such law or public agency requires in order for the property to be put to any lawful purpose. (8) Any material whose presence would require remediation pursuant to the guidelines set forth in the State of California Leaking Underground Fuel Tank Field Manual, whether or not the presence of such material resulted from a leaking underground fuel tank. (9) Pesticides regulated under the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. §136 et seq. (10) Asbestos, PCBs, and other substances regulated under the Toxic Substances Control Act, 15 U.S.C. §2601 et seq. (11) Any radioactive material including, without limitation, any "source material," "special nuclear material," "by-product material," "low-level wastes," "high-level radioactive waste," "spent nuclear fuel" or "transuranic waste" and any other radioactive materials or radioactive wastes, however produced, regulated under the Atomic Energy Act, 42 U.S.C. §§2011 et seq., the Nuclear Waste Policy Act, 42 U.S.C. §§10101 et seq., or pursuant to the California Radiation Control Law, California Health and Safety Code §§25800 et seq. (12) Any material regulated under the Occupational Safety and Health Act, 29 U.S.C. §§651 et seq., or the California Occupational Safety and Health Act, California Labor Code §§6300 et seq. (13) Any material regulated under the Clean Air Act, 42 U.S.C. §§7401 et seq. or pursuant to Division 26 of the California Health and Safety Code. (14) Those substances listed in the United States Department of Transportation Table (49 CFR Part 172.101), or by the Environmental Protection Agency, or any successor agency, as hazardous substances (40 CFR Part 302). (15) Other substances, materials, and wastes that are or become regulated or classified as hazardous or toxic under federal, state or local laws or regulations. 4 (16) Any material, waste or substance that is a petroleum or refined petroleum product, asbestos, polychlorinated biphenyl, designated as a hazardous substance pursuant to 33 U.S.C. §1321 or listed pursuant to 33 U.S.C. §1317, a flammable explosive or a radioactive material. "Immediately Available Funds" means a bank wire transfer or a certified bank or cashier's check. "Improvements" means collectively: (i) any and all buildings, structures and improvements, of any kind whatsoever, located at or affixed to the Real Property; (ii) all rights, privileges and easements appurtenant to the Real Property, if any, including, without limitation, all minerals, oil, gas and other hydrocarbon substances on and under the Real Property, if any; (iii) all development rights, air rights, and water rights if any, relating to the Real Property; and (iv) the Additional Improvements. "Permitted Exceptions" means collectively, the (i) the printed exceptions and exclusions in the Title Policy; (ii) the exceptions to the Title Report (as defined in Section 4(c) below) and approved by Purchaser in writing, or deemed approved by Purchaser, as provided in Section 4(c) below; (iii) real property taxes and assessments which are a lien but not yet payable; (iv) all applicable building, zoning and use restrictions and/or regulations of any municipality, township, county or state; and (v) defects that are shown on the American Land Title Association survey of the Real Property and Improvements which are approved by Purchaser in writing, or deemed approved by Purchaser, as provided in Section 4(c) below. "Property" has the meaning set forth in Recital C, above. "Purchase Price" shall have the meaning set forth in Section 3(a) of this Agreement. "Purchaser" means the City of National City; provided, however, if the City of National City assigns its interest in this Agreement pursuant to Section 11 of this Agreement, then the term "Purchaser" shall mean such assignee. "Real Property" has the meaning set forth in Recital A, above. "Seller" means collectively, Seller's Name(s). "Title Company" means Ticor Title 2878 Camino Del Rio South, Suite 500, San Diego, California 92108. "Title Policy" means a CLTA Owner's Policy of Title Insurance in the amount of the Purchase Price, insuring that title to the fee interest in the Property is vested in the Purchaser subject only to the Permitted Exceptions, which Title Policy shall be obtained through Stewart Title Company. Seller shall pay the cost of the CLTA Owner's Policy of Title Insurance. Purchaser shall pay the cost of any endorsements it desires. Purchaser may obtain an ALTA Owner's Policy of Title Insurance in which event Purchaser shall pay the cost difference between 5 the cost of the ALTA Owner's Policy of Title Insurance and the cost of a CLTA Owner's Policy of Title Insurance. 3. Purchase Price. (a) Total Purchase Price. The purchase price to be paid by the Purchaser for all of the Property shall be Five Hundred Seventy -Five Thousand and No/100 Dollars ($575,000.00) ("Purchase Price"). (b) Deposit Liquidated Damages. (1) Deposit. Purchaser shall make a deposit ("Deposit") into Escrow in the amount of Two Thousand Five Hundred and No/100 Dollars ($2,500.00) within ten (10) business days of the Effective Date. If Purchaser elects to terminate this Agreement prior to expiration of the Due Diligence Period then the Deposit shall be immediately returned by Escrow Agent to the Purchaser. If Purchaser elects to terminate or defaults under this Agreement after the expiration of the Due Diligence Period but prior to Closing, then the Deposit shall be distributed to Seller and Purchaser as provided in the liquidated damages provision below. At Closing, the Deposit shall be credited against the Purchase Price as provided in this Agreement. (2) LIQUIDATED DAMAGES. THE DEPOSIT SHALL BE REFUNDABLE TO THE PURCHASER AS EXPRESSLY PROVIDED FOR IN THIS AGREEMENT. IF ESCROW FAILS TO CLOSE AS A RESULT OF PURCHASER'S DEFAULT UNDER THIS AGREEMENT, THE SOLE REMEDY OF SELLER SHALL BE TO TERMINATE THIS AGREEMENT BY GIVING WRITTEN NOTICE TO PURCHASER AND ESCROW AGENT, WHEREUPON THE SELLER SHALL RETAIN AS LIQUIDATED DAMAGES THE DEPOSIT (AND SELLER WAIVES ANY RIGHT TO SPECIFICALLY ENFORCE THIS AGREEMENT SET FORTH IN CALIFORNIA CIVIL CODE SECTION 1680 OR 3389). THEREAFTER, NO PARTY HERETO SHALL HAVE ANY FURTHER LIABILITY OR OBLIGATION TO ANY OTHER PARTY HERETO EXCEPT FOR: (i) THE SELLER'S RIGHT TO RECEIVE AND RETAIN SUCH LIQUIDATED DAMAGES; AND (ii) THE OBLIGATION OF THE PARTIES TO PAY AMOUNTS INTO ESCROW TO PAY A PORTION OF THE FEES AND COSTS OF ESCROW AS SET FORTH IN THIS AGREEMENT. THE PARTIES TO THIS AGREEMENT ACKNOWLEDGE AND AGREE THAT THE SELLER'S ACTUAL DAMAGES IN THE EVENT OF PURCHASER'S DEFAULT ARE UNCERTAIN IN AMOUNT AND DIFFICULT TO ASCERTAIN, AND THAT SUCH AMOUNT OF LIQUIDATED DAMAGES IS REASONABLE UNDER THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1671 ET SEQ., CONSIDERING ALL OF THE CIRCUMSTANCES EXISTING ON THE DATE HEREOF INCLUDING, WITHOUT LIMITATION, THE RELATIONSHIP OF SUCH AMOUNT TO THE RANGE OF POTENTIAL HARM TO THE SELLER THAT CAN REASONABLY BE ANTICIPATED AND THE ANTICIPATION THAT PROOF OF ACTUAL DAMAGES RESULTING FROM SUCH DEFAULT WOULD BE COSTLY AND INCONVENIENT. IN PLACING ITS INITIALS IN THE SPACE BELOW, EACH PARTY TO THIS AGREEMENT SPECIFICALLY CONFIRMS THE ACCURACY OF THE FOREGOING AND THE FACT 6 THAT SUCH PARTY HAS BEEN REPRESENTED BY COUNSEL WHO EXPLAINED THE CONSEQUENCES OF THIS LIQUIDATED DAMAGES PROVISION. THE PROVISIONS SF THIS SECTION 3(B)(2) SHALL SURVIVE THE TERMINATION OF “I Seller's Initials chaser's Initials (c) Delivery of Remainder of Purchase Price into Escrow. Not less than one (1) Business Day prior to the Closing Date, the Purchaser shall cause Immediately Available Funds to be delivered to the Escrow Agent in an amount equal to the Purchase Price, minus the Deposit and any interest earned on the Deposit, and plus or minus any adjustments for prorations and expenses required under this Agreement. (d) Disbursement to the Seller. Immediately after the Closing, the Escrow Agent shall disburse to the Seller the funds that the Seller is entitled to receive under this Agreement. 4. Due Diligence Period. During the Due Diligence Period, the Purchaser may determine in the Purchaser's sole and absolute discretion, whether to proceed with the purchase of the Property. During the Due Diligence Period, the Purchaser may terminate this Agreement for any reason or for no reason at all. If the Purchaser teiminates this Agreement during the Due Diligence Period, then: (i) all rights and liabilities of the Purchaser and the Seller with respect to this Agreement shall immediately teiuiinate, except for rights and liabilities that specifically survive such termination; (ii) Escrow Agent shall retum to the Purchaser all funds or other things deposited in Escrow by the Purchaser; and (iii) Escrow Agent shall return to the Seller all funds or other things deposited in Escrow by the Seller. Provided, however, all fees and costs charged by the Escrow Agent shall be paid one-half (1/2) by the Seller and one-half (1/2) by the Purchaser. (a) Access to the Property and Cooperation. During the Due Diligence Period, and during normal business hours, upon not less than twenty-four (24) hours advance notice to the Seller, Purchaser and its representatives, consultants and attorneys shall have access to entry upon the Property. Purchaser shall indemnify, defend, protect and hold the Seller and Seller's successors, assigns, officers, directors, shareholders, participants, partners, affiliates; employees, representatives, invitees and agents or any of them, and the Property harmless from any losses, costs, damages, claims and/or liabilities, including but not limited to, mechanics' and materialmen's liens and attorney fees and costs proximately_caus_edhy_such entr upon the Property. In the event Escrow does not close due to an election by the Purchaser not to purchase the Property or a default by the Purchaser, the Purchaser shall, at its sole cost and expense, promptly return the Property to the Seller in the same physical condition it now enjoys, and shall repair any physical damage caused by the Purchaser to the Property as part of or in connection with any such entry upon the Property. The Purchaser is self -insured with excess coverage provided pursuant to an insurance pool. Purchaser's agents, consultants and contractors will secure and maintain, at the Purchaser's or such other person's sole cost, the following policies of insurance which include coverage of all of Purchaser's and its representatives', consultants' and attorneys' activities on the Property: (1) comprehensive public liability and property damage insurance, including direct contractual and contingent liability with limits of $2,000,000 for personal liability to or death of any one person, $2,000,000 for personal injury to or death of any one person on an occurrence basis, $1,000,000 for property damage in any one accident and S2,000,000 policy limit for aggregate operation on an occurrence basis; (2) comprehensive automobile liability insurance with limits of $1,000,000 for personal injury to or death of any one person, $2,000,000 for personal injury to or death of more than one person in any one accident and $1,000,000 for property damage in any one accident; (3) workers compensation and employer's liability insurance in accordance with the provisions of California law. Policies of insurance described in clause (1), above, shall name the Seller as an additional insured. Certificates of such insurance shall be delivered by the Purchaser to the Seller before entry onto the Property by the Purchaser or its agents, contractors or employees. All such Certificates shall require at least thirty (30) days written notice to Seller prior to termination of such insurance. The Purchaser shall not permit any mechanic's, materialman's, contractor's, subcontractor's or other lien arising from any work done by the Purchaser or its agents pursuant to this Agreement to stand against the Property. If any such lien shall be filed against the Property, the Purchaser shall cause the same to be discharged or bonded within ten (10) days after actual notice of such filing, by payment, deposit, bond or otherwise. The Purchaser's obligations under this Section 4(a) shall survive the termination or expiration of this Agreement and/or Closing. The Purchaser shall have the right during the Due Diligence Period, after providing not less than twenty-four (24) hours advance notice to the Seller, to perform (or cause its consultants and contractors to perform) lead based paint and asbestos testing provided the same are performed in accordance with ASTM published testing standards. Except as set forth in the immediately preceding sentence, if Purchaser desires to do any invasive testing at the Property, the Purchaser may do so only after obtaining Seller's prior written consent to the same, which consent may be withheld or granted on conditions in Seller's sole and absolute discretion. The Purchaser shall promptly restore the Property to the condition the Property was in immediately prior to any such tests, at the Purchaser's sole cost and expense. The Purchaser shall provide the Seller with a complete set of plans, drawings and specifications ("Invasive Testing Plans") that define to the sole satisfaction of the Seller the invasive testing to be performed on the Property and the names of all environmental and other consultants, contractors and subcontractors who will be performing such invasive testing (collectively "Purchaser's Consultants"). The Purchaser shall deliver the names of the Purchaser's Consultants and the Invasive Testing Plans to the Seller concurrently with its request to the Seller that the Purchaser desires to perform invasive testing (unless the names of Purchaser's Consultants have previously been provided to the Seller). (b) Title. Purchaser's obligation to purchase the Property is contingent upon Purchaser's approval of all matters affecting title to or use of the Real Property (collectively, "Title Matters"). The intent of this Section 4(b) is to allow the parties to have certainty regarding the condition of title and the Title Matters which are acceptable to the Purchaser. The procedure set forth in this Section 4(b) shall not affect or otherwise limit the Purchaser's right to terminate this Agreement for any reason or no reason at all as set forth in Section 4, above. (1) Title Report. Title Company previously delivered a current preliminary title report for the Real Property to the Purchaser ("Title Report"). Purchaser shall have until June 25, 2014 (eight (8) days after the Effective Date), to approve or object to any items 8 disclosed by the Title Report. If Purchaser does not give written notice to Seller of Purchaser's approval or disapproval of any items disclosed by the Title Report within said time period, then Purchaser shall be deemed to have approved the items disclosed by the Title Report. If Purchaser gives written notice to Seller of Purchaser's disapproval of any items disclosed by the Title Report within said time period and Seller does not give written notice to Purchaser within two (2) calendar days thereafter of: (i) Seller's elimination of or agreement to eliminate those disapproved matters prior to the close of Escrow; or (ii) Seller's agreement to provide at Seller's sole expense such title insurance endorsements relating thereto as are acceptable to Purchaser in Purchaser's sole discretion prior to the close of Escrow (each, a "Cure Notice"), then this Agreement shall terminate immediately, unless Purchaser affirmatively agrees in writing that this Agreement will remain in full force and effect. Notwithstanding the foregoing, Seller shall cause all Title Matters which are mechanics' liens and/or deeds of trust to be eliminated as exceptions to title on the Title Policy at Seller's sole expense prior to the close of Escrow. (2) Survey. Seller shall use commercially reasonable efforts to cause an American Land Title Association survey of the Real Property and Improvements to be completed on or before June 25, 2014 (eight (8) days after the Effective Date). Purchaser shall have until July 3, 2014 (sixteen (16) days after the Effective Date), to approve or object to any items disclosed by the American Land Title Association survey. If Purchaser does not give written notice to Seller of Purchaser's approval or disapproval of any items disclosed by the American Land Title Association survey within said time period, then Purchaser shall be deemed to have approved the any items disclosed by the American Land Title Association survey. If Purchaser gives written notice to Seller of Purchaser's disapproval of any items disclosed by the American Land Title Association survey within said time period and Seller does not give written notice to Purchaser within two (2) calendar days thereafter of: (i) Seller's elimination of or agreement to eliminate those disapproved matters prior to the close of Escrow; or (ii) Seller's agreement to provide at Seller's sole expense such title insurance endorsements relating thereto as are acceptable to Purchaser in Purchaser's sole discretion prior to the close of Escrow (each, a "Cure Notice"), then this Agreement shall terminate immediately, unless Purchaser affirmatively agrees in writing that this Agreement will remain in full force and effect. 5. Completion of Additional Improvements. (a) No later than five (5) days after the Effective Date, Seller will begin construction of the Additional Improvements in accordance with the Construction Contract. All costs and expenses of the construction of the Additional Improvements will be paid by Seller. Seller shall apply for, pay for and obtain, any and all permits or licenses required by applicable governmental authorities (including without limitation, City of National City Development Services) necessary or desirable for Seller to construct and install the Additional Improvements. The Purchaser shall not be responsible in any way for, the processing Seller's building permits or other permit applications with the City of National City Development Services. The execution of this Agreement by the Purchaser (i.e., the City of National City) does not constitute the granting of or a commitment to provide any required permits, entitlements or approvals. Seller shall comply with all applicable requirements of the City of National City Development Services and all applicable provisions of the California Public Contract Code. Seller, the general contractor, and any and all subcontractors, shall pay prevailing wages for all work done with 9 respect to the Additional Improvements as required by California law, including without limitation, the following: (1) Seller, the general contractor, and any and all subcontractors shall comply with prevailing wage requirements and be subject to restrictions, obligations, requirements, and penalties, in accordance with Section 1770 et seq. of the California Labor Code which requires prevailing wages be paid to appropriate work classifications in all bid specifications and subcontracts. (2) Seller, the general contractor, and any and all subcontractors shall furnish all subcontractors/employees a copy of the California Department of Industrial Relations prevailing wage rates which the general contractor will post at the job site. Copies of the prevailing wage rates are available at the Purchaser's office and shall be made available to any interested party on request. (3) Seller, the general contractor, and any and all subcontractors shall comply with the payroll record keeping and availability requirement of Section 1776 of the California Labor Code, and shall deliver to the Purchaser not less than monthly, copies of the certified payroll records and all other documents required to be maintained pursuant to Section 1776 of the California Labor Code or any regulations issued by the California Department of Labor and/or the California Labor Commissioner with respect to the same. (4) Seller, the general contractor, and any and all subcontractors shall make travel and subsistence payments to workers needed for performance of work in accordance with the California Labor Code. (5) Prior to commencement of construction, the Seller, the general contractor, and any and all subcontractors shall contact the Division of Apprenticeship Standards of the California Department of Industrial Relations and comply with Section 1777.5, 1777.6, and 1777.7 of the California Labor Code and all applicable regulations, (b) At reasonable times and on reasonable notice during construction of the Additional Improvements, the Purchaser and its agents and representatives shall have access, without liability, to the Property and to all construction, job records, and information of Seller relating to the construction of the Additional Improvements (whether on Seller's premises or the premises of Seller's architects, engineers, contractors, and consultants) for the purpose of determining whether the work being performed is in accordance with the Construction Contract and this Agreement. All construction shall be performed in accordance with the Construction Contract. Any deficiencies in construction shall be corrected by the Seller, upon written notice from the Purchaser. Seller will at all times keep at the Property a complete updated set of the plans and specifications for the Additional Improvements for examination by Purchaser and its agents and representatives. (c) If Purchaser determines at any time prior to the Completion of the Additional Improvements, as defined in Section 5(d), below, that construction of the Additional Improvements is not proceeding in accordance with the Construction Contract or with this Agreement, and Purchaser does not elect to waive the deviation, deficiency, or omission, Purchaser will give notice to Seller specifying the particular deviation, deficiency, or omission, and Seller will take any corrective work that is necessary to correct the deviation, deficiency, or omission. 10 (d) On or before August 31, 2014 ("Completion Date"), Seller agrees to cause the completion of the Additional Improvements substantially in accordance with the Construction Contract in a good and workmanlike manner. Failure to cause Completion of the Additional Improvements on or before the Completion Date shall be a material default hereunder. The completion of the Additional Improvements ("Completion of the Additional Improvements") will be deemed to have happened on the occurrence of all of the following: (i) the Additional Improvements have been substantially completed in accordance with the Construction Contract; (ii) the Design Architect has certified and provided to the Purchaser on AIA Form G-704 or similar form, a "Certificate of Substantial Completion," that the Additional Improvements have been completed substantially in accordance with the Construction Contract, and as such, are ready for occupancy; (iii) City of National City Development Services has issued a permanent certificate of occupancy and signed off on all permits for the building or structures on the Property; (iv) the Inspecting Engineer has certified and provided to Purchaser on AIA Form G-704, or similar form, a "Certificate of Substantial Completion," that the Additional Improvements have been completed substantially in accordance with the and are ready for occupancy; (v) Seller has certified to Purchaser that all of the costs for the construction and completion of the Additional Improvements have been paid in full, including, without limitation, payment for services rendered and material delivered by mechanics, materialmen, suppliers, architects, engineers, subcontractors, and the like, or punch list holdbacks; (vi) Purchaser has received reasonably satisfactory evidence that (A) all utilities reflected in the Construction Contract and required for the use and occupancy of the Additional Improvements enter the Property from adjacent public rights -of -way or through valid and appurtenant easements that will be transferred to Purchaser and have been installed, (B) any hookup, tap -on, or connection fees and charges for those utilities have been paid, (C) the installation of the utilities has been approved by the various utility companies, and (D) utility service to the Property has commenced; (vii) Purchaser has received copies of a survey indicating that the Improvements have been erected completely within the boundaries of the Property and are not in violation of any setback restrictions affecting the Property and that no Improvements that are a part of the Property encroach onto adjacent land; and (ix) Seller has notified Purchaser that the Additional Improvements have been completed, and Seller has delivered to Purchaser all of the items required by subdivisions (i) through (viii), inclusive, of this Section 5. 6. Conditions Precedent for the Benefit of the Purchaser. The Purchaser's obligation to Close shall be conditioned upon the satisfaction or emailed or written waiver by the Purchaser of all of the conditions precedent ("Conditions Precedent for the Benefit of the Purchaser") set forth in this Section 6. Any of the Conditions Precedent for the Benefit of the Purchaser may be waived by the Purchaser unilaterally; and if so waived, such conditions shall be of no further effect hereunder. Any such waiver shall be effective only if the same is expressly waived (i) by 11 email from the Purchaser to the Seller and Escrow Agent; or (ii) in a writing signed by the Purchaser and delivered to the Seller and Escrow Agent. If the Conditions Precedent for the Benefit of the Purchaser are not satisfied by the deadlines set forth in this Section 6 or expressly waived, the Purchaser (provided the Purchaser is not in default hereunder) may provide emailed or written notice of the Purchaser's conditional termination of this Agreement to the Seller and Escrow Agent. After receipt of such notice of conditional termination, the Seller shall have two (2) Business Days to cure any non -satisfaction of a condition or other default specified in the notice of conditional termination. If such matter remains unsatisfied or the default remains uncured after the expiration of such two (2) Business Day period, then this Agreement shall terminate at the close of business on such second (2"d) Business Day. In the event of termination of this Agreement (and by operation of law the Escrow) pursuant to this Section 6, then: (x) except to subparagraph (f) below, the same shall be a default by the Seller (y) Escrow Agent shall return to the Purchaser all funds or other things deposited in Escrow by the Purchaser, including without limitation, the Deposit; and (z) Escrow Agent shall return to the Seller all funds or other things deposited in Escrow by the Seller. Purchaser is not waiving any default by the Seller and nothing contained in this Section 6, including, without limitation, the immediately foregoing sentence shall be a waiver of any right of Purchaser to recover damages from the Seller for failure of any Conditions Precedent for the Benefit of the Purchaser. Provided, however, all fees and costs charged by the Escrow Agent shall all be paid by the Seller. (a) The deposit into Escrow by the Seller of the Grant Deed, duly executed and acknowledged, conveying fee simple title to the Property to the Purchaser at least one (1) Business Day prior to Closing. (b) The deposit by the Seller into Escrow of a duly executed affidavit that it is not a foreign person and is a "United States Person" as such term is defined in Section 7761(a)(30) of the Internal Revenue Code of 1986, as amended, at least one (1) Business Days prior to Closing. The affidavit shall be in the form prescribed by federal regulations, if any. (c) The deposit by the Seller into Escrow of a duly executed California Form 593(c) or other evidence that withholding of any portion of the Purchase Price is not required by the Revenue and Taxation Code of California, at least one (1) Business Day prior to Closing. (d) The deposit by the Seller into Escrow of all additional documents and instruments as are reasonably required by the Purchaser and/or Escrow Agent to complete the Closing, at least one (1) Business Day prior to Closing. (e) The Escrow Agent is prepared and obligated to issue the Title Policy in Purchaser's favor upon the recordation of the Grant Deed and there are no exceptions to the Title Policy, except for Permitted Exceptions. (f) Seller not being in default of any of its representations or warranties under this Agreement, or any other material terms or conditions related to Seller. (g) As of the Closing Date, there exists no lease, tenancy or occupancy agreement affecting the Property. 12 (h) As of the Closing Date there is not pending, or threatened to be pending, any action or proceeding by any person or before any government authority, the outcome of which could prohibit the use of the Property as intended by the Purchaser. This Agreement has been formally approved by resolution of the City of National Completion of the Additional Improvements as set forth in Section 5, above; (k) The Property is not destroyed or damaged by fire or other casualty and, if any casualty has occurred, the Property is restored to a condition equivalent with the completion of the Improvements; (1) Seller has not made an assignment for the benefit of creditors, filed a petition in bankruptcy, been adjudicated insolvent or bankrupt, petitioned a court for the appointment of any receiver of or trustee for it or any substantial part of its property, or commenced any proceeding relating to Seller under any reorganization, arrangement, readjustment of debt, dissolution, or liquidation law or statute of any jurisdiction, whether now or later in effect. There has not been commenced or pending against Seller any proceeding of the nature described in the first sentence of this subsection. No order for relief has been entered with respect of Seller, or any affiliated entity, under the Federal Bankruptcy Code; (m) There exists no Hazardous Materials on or otherwise affecting the Property; (n) There exist no known violations of any Applicable Environmental Law; and (o) Seller has complied and at Closing will be in compliance with each covenant in this Agreement, and the warranties in this Agreement will be true as of the Closing Date. 7. Seller's Representations and Warranties. As a material inducement to Purchaser, Seller warrants to Purchaser that, as of the date of this Agreement and as of the Closing Date: (a) there are no actions, suits, or proceedings pending, or, to the knowledge of Seller, threatened, against Seller or the Property, or involving the validity or enforceability of this Agreement, including, but not limited to, petitions under the Bankruptcy Act of 1978 or other petitions for reorganization or for debtor relief or for the appointment of a receiver; (b) the execution and delivery of this Agreement by Seller and the performance and observance of the terms have all been authorized by all necessary actions of Seller. This Agreement has been duly executed and delivered by Seller. This Agreement is in full force and is enforceable against Seller in accordance with its terms; (c) Seller owns good, marketable, and insurable fee simple title free of all Title Defects for the real property. Seller owns good title free of all Title Defects for the balance of the Property; (d) the Property have not suffered any damage by fire, windstorm, or other hazard that is not fully covered by insurance (or if covered by insurance, that would make it 13 economically impractical for the Property to be restored or repaired) and that have not been fully restored, repaired, and rebuilt and no condemnation or other proceedings prohibiting the full use of the Property as originally contemplated by the parties have been instituted or threatened; (e) the general plans and notes and the Improvements, when completed, will comply with all applicable requirements of Governmental Authorities having jurisdiction; (f) the Improvements, when completed, in accordance with the general plans and notes, will be structurally sound; (g) in conjunction with all manufacturer's warrant(ies)/guarantee(s) for all products provided for the Improvements, all work for the Improvements shall be guaranteed by Seller for a period of one (1) year from the date of completion against defective workmanship and materials furnished by Seller. Seller shall promptly replace or repair, in a manner satisfactory to Purchaser, any such defective work, after notice to do so from Purchaser, and upon the Seller's failure to make such replacement or repairs promptly, Purchaser may perform this work and Seller shall be liable for the cost thereof; (h) no Hazardous Materials are present on, within or under the Property, or in the soil, groundwater or soil vapor on or under the Property. Seller has received no notice of any proceeding or inquiry pending before or by any governmental authority with respect to the presence of Hazardous Materials or the migration of Hazardous Materials to or from any other Property, nor is the Seller aware of any threat of such notice or of any environmental permits, disclosures, applications, entitlements or inquiries relating to the Property, including notices of violation, notices to comply, citations, inquiries, clean-up or abatement orders, cease and desist orders, reports filed pursuant to self -reporting requirements and reports filed or applications made pursuant to any governmental requirement relating to Hazardous Materials or underground tanks. (i) no person has any lease or other right to occupy the Property or any parts thereof. 8. Environmental Indemnity. Seller agrees to indemnify, defend and hold the Purchaser and all of its members, agents, officers, representatives, directors and employees (the "Indemnified Parties") harmless from and against any claim, action, suit, proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense (including, without limitation, attorneys' fees), resulting from, arising out of, or based upon any of the following which the occurs prior to Closing (regardless of whether the Purchaser became aware of the same before or after the Closing): (i) the existence, presence, release, use, generation, discharge, storage or disposal of any Hazardous Materials on, under, in or about, the Property, or (ii) the violation, or alleged violation, of any statute, ordinance, order, rule, regulation, permit, judgment or license relating to the use, generation, release, discharge, storage, disposal or transportation of Hazardous Materials on, under, in or about, to or from, the Property. The Seller's indemnification obligation set forth in this Section 8 shall not apply with respect to Hazardous Materials came to be on, under, in or about the Property after the Closing. This indemnity shall include, without limitation, any damage, liability, fine, penalty, parallel indemnity after closing cost or expense arising from or out of any claim, action, suit or proceeding for personal injury (including sickness, disease or death), tangible or intangible property damage, compensation for lost wages, business income, profits or other economic loss, damage to the natural resource or the environment, nuisance, contamination, leak, spill, release or other adverse effect on the environment. This indemnity provided in this Section 8 does not include any condition arising solely as a result of the affirmative acts or gross negligence of the Indemnified Parties. Notwithstanding anything contained in this Agreement to the contrary, the Seller's duty to indemnify the Indemnified Parties as set forth in this Section 8 shall survive and remain an outstanding obligation of the Seller after Closing. 14 9. Seller's Covenants. Seller covenants to Purchaser that, through and including the Closing Date: (a) neither the Property (nor any part of it or any interest in this Agreement), nor any revenues, rents, issues, or profits from the Property, nor any interest in Seller, will be sold, transferred, assigned, mortgaged, pledged, or in any other way encumbered or conveyed without Purchaser's prior written consent. (b) Seller shall deliver to Purchaser monthly reports on the status of the construction of the Additional Improvements. The reports will include Seller's good -faith estimate of the date construction will be completed. (c) no changes will be made in the Construction Contract without Purchaser's prior written approval. Any proposed changes to the Construction Contract will be delivered to Purchaser with sufficient time for appropriate review. (d) Seller will not take or permit any action that would be inconsistent with or make impossible the consummation of the purchase and sale in accordance with this Agreement. (e) without the prior written approval of Purchaser, Seller will not execute or make any agreement or other arrangement or modify any existing agreement or other arrangement that cannot be terminated on thirty (30) days' notice and that may bind or obligate the Property or Purchaser after Closing. (f) so long as this Agreement remains in force, Seller will not lease, convey, transfer, assign, mortgage, encumber, or pledge, whether absolutely or to secure a debt, any part of or any interest in the Property or enter into any agreement not relating to the construction of the Improvements that grants to any person any right with respect to the Property, any portion of the Property, or any interest in this Agreement. 10. Condemnation of the Property. (a) If between the Effective Date and the Closing Date, any condemnation or eminent domain proceeding is commenced that will result in the taking of any part of the Property, Purchaser may, at Purchaser's election, either: (1) Terminate this Agreement by giving written or emailed notice to the Seller and the Escrow Agent (in which event all remaining funds or other things deposited in Escrow by Purchaser, including without limitation, the Deposit, shall be returned to the Purchaser immediately from Escrow, together with any interest earned thereon and all fees and costs charged by the Escrow Agent shall be paid one-half (1/2) by the Seller and one-half (1/2) by the Purchaser; or (2) Proceed with the Closing with no reduction in the Purchase Price, in which event the Seller shall assign to the Purchaser all of the Seller's rights, titles and interests to any award made for the condemnation or eminent domain action. 15 (b) Notice. If the Seller obtains notice of the commencement of or the threatened commencement of eminent domain or condemnation proceedings with respect to all of any portion of the Property, the Seller shall notify the Purchaser in writing. 11. Broker's Commission. (a) No Brokers. The Seller and Purchaser each hereby represent and warrant to one another that they have not engaged the services of any real estate agent or broker with respect to the transaction that is the subject of this Agreement. (b) Indemnity. The Purchaser and the Seller each agree that, to the extent any real estate commission, brokerage commission or finder's fee shall be earned or claimed in connection with this Agreement or the Closing, the payment of such fee or commission, and the defense of any action in connection therewith, shall be the sole and exclusive obligation of the party who requested (or is alleged to have requested) the services of the broker or finder. In the event that any claim, demand or cause of action for any such commission or finder's fee is asserted against the party to this Agreement who did not request such services (or is not alleged to have requested such services), the party through whom the broker or finder is making the claim shall indemnify, defend (with an attorney of the indemnitee's choice), protect and hold harmless the other from and against any and all such claims, demands and causes of action and expenses related thereto, including, without limitation, attorneys' fees and costs. (c) Survival. The provisions of this Section 11 shall survive the Closing or termination of this Agreement. 12. Assignment. The Purchaser shall not assign any of its rights or delegate any of its duties under this Agreement without the prior written consent of the Seller, which consent may be withheld or granted in Seller's sole and absolute discretion; provided, however, the Purchaser may assign this Agreement to an entity in which the Purchaser has a controlling or majority interest without the prior written consent of the Seller provided Purchaser and such assignee execute an assignment agreement in form and substance reasonably acceptable to Seller. 13. Notices. All notices under this Agreement shall be in writing and sent (a) by certified or registered mail, return receipt requested, in which case notice shall be deemed delivered three (3) Business Days after deposit, postage prepaid in the United States Mail, (b) overnight by a nationally recognized overnight courier such as UPS Overnight, or FedEx, in which case notice shall be deemed delivered one (1) Business Day after deposit with that courier, (c) by personal delivery, in which case notice shall be deemed delivered upon the actual date of delivery, or (d) by email, in which case notice shall be deemed delivered upon the actual date of delivery. All notices shall be delivered to the following addresses: If to Seller: Stephen Randolph Johnston, Michelle Leann 16 William Ralph and If to Purchaser: Copy to: Facsimile No. Email: City of National City Attn: Brad Raulston 1243 National City Boulevard National City, CA 91950 Facsimile No. (619) 336-4286 Email: braulston@nationalcityca.gov Christensen & Spath LLP Attention: Walter F. Spath III 550 West C Street, Suite 1660 San Diego, CA 92101 Facsimile No. (619) 236-8307 Email: wfs@candslaw.net The addresses above may be changed by written notice to the other party; provided however, that no notice of a change of address shall be effective until actual receipt of the notice. 14. Risk of Loss. (a) Damage or Destruction. Subject to the provisions of this Section 14(a), the risk of loss or damage to the Property until the close of Escrow will be borne by Seller. Upon the occurrence of any damage to or destruction of the Property, Seller shall within thirty (30) days after the occurrence of such damage or destruction give written notice to Purchaser ("Damage Notice") specifying the estimated cost to repair or restore the Property and an estimate of the insurance proceeds, if any, that will be available with respect to such damage or destruction. The close of Escrow shall be appropriately delayed to provide adequate time for Seller to give the Damage Notice and Purchaser to make its election provided for below. (b) Damage in Excess of $100,000. If prior to the close of Escrow there is damage to or destruction of the Property that will cost in excess of One Hundred Thousand Dollars ($100,000) to repair or restore, Purchaser shall have the right by written notice given to Seller within ten (10) days of Purchaser receiving the Damage Notice, to elect to: (i) close Escrow in such damaged condition, in which event the Purchase Price shall not be reduced (but the Seller shall be obligated to pay the deductibles under the applicable insurance policy or policies) and Seller shall not be obligated to repair or restore the Property and all insurance proceeds shall be assigned and payable to Purchaser, and if Seller receives any such insurance proceeds, they shall be immediately remitted by Seller to Purchaser at Closing or, if received by Seller after Closing, promptly after receipt; (ii) terminate this Agreement, in which event the Deposit and all interest accrued thereon shall be immediately returned to Purchaser, and neither party shall have any further rights or obligations to the other party, except neither party shall be relieved of any obligations provided for in this Agreement which expressly survives its termination. 17 (c) Damage of $100,000 or Less. If prior to the close of Escrow there is damage to or destruction of the Property that will cost One Hundred Thousand Dollars ($100,000) or less to repair or restore, Purchaser shall nevertheless close Escrow with the Property in such damaged condition, the Purchase Price shall not be reduced (but the Seller shall be obligated to pay the deductibles under the applicable insurance policy or policies) and Seller shall not be obligated to repair or restore the Property, and all insurance proceeds shall be assigned and payable to Purchaser, and if Seller should receive any such insurance proceeds, they shall be immediately remitted to Purchaser. 15. Prorations. Real property taxes and assessments and utility costs, and other expenses of operating the Property (provided, however, no proration shall be made with regard to any capital improvements) shall be prorated as of the close of Escrow. Seller shall pay all documentary transfer taxes. Seller shall pay all real property taxes and assessments applicable to the period prior to the close of Escrow, and if any such taxes are unpaid after the close of Escrow, then Seller shall pay them promptly and in any event within ten (10) days after Purchaser's request (which shall include a copy of the relevant tax bill). 16. General Provisions. (a) Governing Law. This Agreement shall be interpreted and construed in accordance with California law, without regard to any choice of law principles. (b) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (c) Captions. The captions in this Agreement are inserted for convenience of reference and in no way define, describe or limit the scope or intent of this Agreement or any of the provisions of this Agreement. (d) Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties and their respective legal representatives, successors, heirs and permitted assigns. (e) Modifications; Waiver. No waiver, modification, amendment, discharge or change of this Agreement shall be valid unless it is in writing and signed by the party against which the enforcement of the modification, waiver, amendment, discharge or change is sought. (f) Entire Agreement. This Agreement contains the entire agreement between the parties relating to Purchaser's acquisition of the Property from the Seller and all prior or contemporaneous agreements, understandings, representations or statements, oral or written, are superseded. (g) Partial Invalidity. Any provision of this Agreement which is unenforceable, invalid, or the inclusion of which would adversely affect the validity, legality, or enforcement of this Agreement shall have no effect, but all the remaining provisions of this Agreement shall remain in full effect. 18 (h) Survival. Provisions of this Section 15 shall survive the Closing or the termination of this Agreement. (i) No Third -Party Rights. Nothing in this Agreement, express or implied, is intended to confer upon any person, other than the parties to this Agreement and their respective successors and assigns, any rights or remedies. (j) Time of Essence. Time is of the essence in this Agreement. (k) Attorneys' Fees. The parties agree that the prevailing party in litigation for the breach and/or interpretation and/or enforcement of the terms of this Agreement shall be entitled to their expert witness fees, if any, as part of their costs of suit, and attorneys' fees as may be awarded by the court, pursuant to California Code of Civil Procedure ("CCP") Section 1033.5 and any other applicable provisions of California law, including, without limitation, the provisions of CCP Section 998. All claims, disputes, causes of action or controversies shall be subject solely to the jurisdiction of the San Diego Superior Court, Downtown Branch. (1) Relationship. Nothing contained in this Agreement shall be deemed or construed by the parties or by any third person to create a relationship of principal and agent or partnership or a joint venture between the Purchaser and the Seller or between any of them and any third Ply. (m) Recording. Neither this Agreement nor a memorandum hereof shall be recorded. (n) Purchaser Approval. Where this Agreement refers to an action or approval of the Purchaser, it shall mean the approval of the Community Development Executive Director of the Purchaser, or designee, unless otherwise provided. (o) Exhibits and Recitals Incorporated. All exhibits referred to in this Agreement are hereby incorporated in this Agreement by this reference, regardless of whether or not the exhibits are actually attached to this Agreement. The Recitals to this Agreement are hereby incorporated in this Agreement by this reference. (p) Independent Counsel. Seller and Purchaser each acknowledge that: (a) they have been given the opportunity to be represented by independent counsel in connection with this Agreement; (b) they have executed this Agreement with the advice of such counsel, if such counsel was retained; and (c) this Agreement is the result of negotiations between the parties hereto and the advice and assistance of their respective counsel, if such counsel was retained. The fact that this Agreement was prepared or negotiated by Purchaser's or Seller's counsel as a matter of convenience shall have no import or significance. Any uncertainty or ambiguity in this Agreement shall not be construed against either party due to the fact that Purchaser's or Seller's counsel prepared or negotiated this Agreement in its final form. (q) 1031 Exchange. In order to effect an Internal Revenue Code section 1031 tax - deferred exchange of the Property, Seller has the right to engage an accommodator to fulfill 19 Seller's obligations hereunder; in which case Purchaser shall cooperate to accomplish such exchange provided each of the following conditions are satisfied: (i) Purchaser shall, in such cooperation, incur no cost, liability or obligation for consideration (or otherwise) other than the costs and consideration called for in this Agreement; and (ii) the Closing shall not be delayed or prevented. (r) Tolling of Deadlines. Any periods of time, deadlines or time or day limitations set forth in this Agreement, including without limitation, the Due Diligence Period, the deadline for Closing, the deadline for making the Deposit, shall all be automatically extended by one (1) Business Day for each Business Day that the Seller fails to timely provide any notice, report, materials, studies, documentation or other information required by this Agreement. (s) Capacity and Authority. All individuals signing this Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, represent and warrant that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. SELLER: Step h- • ` andol. Johnston Paul Willia / �• , , M'chelle Leann Hooper Ralp;� [SIGNATURES CONTINUED ON FOLLOWING PAGE] 20 PURCHASER: CITY OF NATIONAL CITY By: Ron Morrison, Mayor Dated: June 17, 2014 21 EXHIBIT "A" PROPERTY LEGAL DESCRIPTION Real property in the City of National City, County of San Diego, State of California, described as follows: Lots 23 and 24 in Block 237 of National City, in the City of National City, County of San Diego, State of California, according to Map thereof No. 348, filed in the Office of the County Recorder of San Diego County, October 2, 1882. APN: 559-095-09-00 22 EXHIBIT "B" GRANT DEED WHEN RECORDED MAIL TO: APN: 559-095-09-00 MAIL TAX STA CEMENTS TO: SPACE ABOVE TIIIS LINE FOR RECORDER'S USE GRANT DEED FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, Stephen Randolph Johnston, an unmarried man as to an undivided 50% interest, and Paul William Ralph and Michelle Leann Hooper Ralph, husband and wife as joint tenants as to an undivided 50% interest, as tenants in common hereby GRANT to the City of National City the following described real property in the County of San Diego, State of California: Lots 23 and 24 in Block 237 of National City, in the City of National City, County of San Diego, State of California, according to Map thereof No. 348, filed in the I ffice of the County Recorder of San Diego County, October 2, 1882. Stephen Paul Wil Michelle Leann Hooper Ralph DatedIvc/S , 2014 Dated e/9 2014 Dated TvAem3014 23 ACCEPTANCE This is to certify that the interest(s) in real property conveyed by this instrument to the City of National City, are hereby accepted by the undersigned officer on behalf of the City of National City, pursuant to authority conferred by resolution of the City of National City, Resolution No. 2014-99 adopted on June 17, 2014, and the grantee consents to recordation thereof by its duly authorized officer. CITY OF NATIONAL CITY By: R Morrison, Mayor Apprv ;d as to Form: u� .citua Silva City Dated: June 17, 2014 24 EXHIBIT "C" ADDITIONAL IMPROVEMENTS CITY OF NATIONAL CITY CONSTRUCTION CONTRACT BY AND BETWEEN THE CITY OF NATIONAL CITY AND PAUL W. RALPH THIS CONSTRUCTION CONTRACT is entered into this 12th day of June, 2014, by and between the CITY OF NATIONAL CITY, a municipal corporation (the "CITY"), and PAUL W. RALPH, an individual residing in the County of San Diego, State of California, dba WAVETEC CONSTRUCTION, a California licensed contractor (the "CONTRACTOR"). RECITALS A. CITY desires to purchase the property know as 726 W 19th Street, National City, CA 91950 (the "PROPERTY"). B. The owners of the PROPERTY, Paul W. Ralph, Michelle L. H. Ralph and Stephen Johnston desire to sell the PROPERTY to CITY. C. Wavetec Construction is wholly owned by Paul W. Ralph, an owner of the PROPERTY. D. CITY and the owners of the PROPERTY intend to enter into a Purchase and Sale Agreement (the "PSA") for the sale of the PROPERTY to CITY and to deposit the PSA into escrow concurrently with this Agreement. E. CITY developed improvement plans for the PROPERTY that would make the site suitable for its intended use by the CITY'S Public Works Department. F. CITY received an independent architect's estimate for the improvements indicated on the improvement plans from a proven and reliable professional. G. CONTRACTOR has provided CITY a price for the services and improvements that are the subject of this Agreement with a completion date consistent and concurrent with the sale of the PROPERTY. H. CONTRACTOR's price is significantly less than the independent architect's estimate for improvements. Due to the significant savings of cost with CONTRACTOR over the cost to perform the same work if CITY were to publicly bid the project and considering CONTRACTOR'S unique position as owner to be able to provide the savings there is no competitive advantage or public good served to bring this contract to public bid. Revised August 2011 NOW, THEREFORE, CITY agrees to engage CONTRACTOR to perform the services set forth herein in accordance with the following terms and conditions and incorporates the above recitals, appendices, attachments, exhibits and referenced materials into this Agreement: 1. Description of Services. CONTRACTOR shall provide services and install improvements as outlined in attached, Exhibit "A", generally described as follows: Structural and real property improvements to the real property located at 726 W. 19th Street, National City, CA 91950. 2. Length of Agreement. The schedule is set forth below: a) Work commence within five (5) working days of THE notice to proceed; and b) Work will be completed within fifty (50) working days of execution of this contract. 3. Compensation. The total compensation to CONTRACTOR for providing the services and improvements set forth in in Exhibit "A" shall be the lump sum amount of $275,000.00. CONTRACTOR's lump sum price is based on all workers being paid the current California prevailing wage. CONTRACTOR shall provide certified payroll documents upon request by the City. 4. Payment Schedule. CITY will make payment to CON TRACTOR for the satisfactory completion services and installation of improvements as defined herein at the close of the escrow opened on about June 18, 2014 for the sale of the property located at 726 W. 19th Street, National City, CA 91950. 5. Termination. CITY may terminate this Agreement at any time by providing written notice to CONTRACTOR. If CITY terminates this contract without cause brought about by CONTRACTOR or the seller of the property at 726 W 19th Street the City shall compensate CONTRACTOR for all costs incurred in furtherance of the work described herein up to and including the date of the delivery of the Notice of Termination. 6. Independent Contractor. It is agreed that CONTRACTOR is an independent Contractor, and all persons working for or under the direction of CONTRACTOR are CONTRACTOR's agents, servants and employees, and said persons shall not be deemed agents, servants or employees of CITY. 7. Insurance. CONTRACTOR shall obtain: A. ❑ If checked, Professional Liability Insurance (errors and omissions) with minimum limits of $1,000,000 per occurrence. B. Automobile insurance covering all bodily injury and property damage incurred during the performance of this Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include owned, non -owned, and hired vehicles ("any auto"). C. Commercial general liability insurance, with minimum limits of $1,000,000 per occurrence/$2,000,000 aggregate, covering all bodily injury and property damage arising out of its operations under this Agreement. 2 D. Workers' compensation insurance in an amount sufficient to meet statutory requirements covering all of CONTRACTOR'S employees and employers' liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of the City. Said endorsement shall be provided prior to commencement of work under this Agreement. E. The aforesaid policies shall constitute primary insurance as to the CITY, its officers, employees, and volunteers, so that any other policies held by the CITY shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to the CITY of cancellation or material change. F. Said policies, except for the professional liability and workers' compensation policies, shall name the CITY and its officers, agents and employees as additional insureds, and separate additional insured endorsements shall be provided. G. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, the CONTRACTOR shall maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Agreement. In addition, the "retro" date must be on or before the date of this Agreement. H. Insurance shall be written with only California admitted companies which hold a current policy holder's alphabetic and financial size category rating of not less than A VIII according to the current Best's Key Rating Guide, or a company equal financial stability that is approved by the City's Risk Manager. In the event coverage is provided by non -admitted "surplus lines" carriers, they must be included on the most recent California List of Eligible Surplus Lines Insurers (LESLI list) and otherwise meet rating requirements. I. This Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by the CITY's Risk Manager. If the CONTRACTOR does not keep all of such insurance policies in full force and effect at all times during the terms of this Agreement, the CITY may elect to treat the failure to maintain the requisite insurance as a breach of this Agreement and terminate the Agreement as provided herein. J. All deductibles and self -insured retentions in excess of $10,000 must be disclosed to and approved by the CITY. K. Insurance certificates must specify certificate holder as: City of National City ATTN: City Attorney's Office 1243 National City Blvd National City, CA 91950-4301 8. Hold Harmless. CONTRACTOR shall defend, indemnify and hold CITY, its Officers, employees and agents harmless from any liability for damage or claims of same, including but not limited to personal injury, property damage and death, which may arise from CONTRACTOR, or CONTRACTOR'S subcontractors, agents or employees' operations under this Agreement. CITY shall cooperate reasonably in the defense of any action, and CONTRACTOR shall employ competent counsel, reasonably acceptable to the City Attorney. 3 9. Acceptability of Work. The City shall, with reasonable diligence, determine the quality or acceptability of the work, the manner of performance and/or the compensation payable to the CONTRACTOR. 10. Business License. CONTRACTOR must possess or shall obtain business license from National City Finance Department before beginning work. 11. Construction Permit. After execution of the Contract and prior to beginning work, the Contractor shall obtain a building/construction permit with the City of National City. The no cost permit can be obtained at the City of National City Building Department from 7:00 a.m. to 6:00 p.m., Monday through Thursday. The permittee shall first provide the following documents at the permit counter with proof that the policies/licenses are current: 1. Workers Compensation Insurance Certificate. 2. General Liability Insurance Certificate. 3. City Business License. 4. Contractor's License and Subcontractor's License (if any) in required classification(s). 5. A copy of Notice of Contract Award. 12. Bonds. CONTRACTOR, simultaneously with the execution of the Contract, will be required to furnish a faithful Performance Bond in an amount equal to one hundred percent (100%) of the Contract price and a Payment Bond in an amount equal to one hundred percent (100%) of the Contract price. Contract Surety Bonds shall be issued by a surety who meets the criteria for sufficiency set forth in Section 995.660 and 995.670 of the California Code of Civil Procedure. (see Attachment B-Performance Bond & Attachment C-Payment Bond) 13. Listing of Subcontractors. As required under the provisions of Section 4100 et seq. of the California Public Contract Code, any person making a bid or offer to perform the work shall, in his/her bid or offer, list: a. The name and location of the place of business of each subcontractor who will perform work or labor, or render service to the prime CONTRACTOR in or about the construction of the work or improvement, or a subcontractor licensed by the State of California who, under subcontract to the primary contractor, specially fabricates and installs a portion of the work or improvement according to detailed drawings contained in the plans and specifications, in an amount in excess of one-half of one percent of the Prime CONTRACTOR's total bid. b. The portion of the work that will be done by each such subcontractor under this act. The CONTRACTOR shall list only one subcontractor for each portion of the work as defined by the in his/her bid. 14. Construction Safety. In addition to Section 6700 et seq. of the California Labor Code, in the event any proposal includes the excavation of any trench or trenches five feet (5') or more in depth, the successful bidder shall submit for acceptance by the City of National City, in 4 advance of excavation, a detailed plan showing the design of shoring, bracing, sloping or other provisions to be made for worker protection from the hazard of caving ground during the excavation of such trench or trenches. The shoring and bracing plan shall be signed by a qualified Registered Engineer. In the event any proposal includes the construction of a pipeline, sewer, sewer disposal system, boring and jacking pits, or similar trenches or open excavations which are five feet (5') or deeper, each bid shall include adequate sheeting, shoring and bracing, or equipment method, for the protection of life or limb, which shall conform to the applicable safety orders. The CONTRACTORis required to comply with the State of California Construction Safety Orders (CAL/OSHA) for securing safety in places of employment. 15. Civil Rights. The City of National City hereby notifies the CONTRACTORthat it will affirmatively ensure that in any Contract entered into pursuant to this advertisement, minority business enterprises will be afforded full opportunity to submit bids in response to this invitation and will not be discriminated against on grounds of race, religious creed, color, national origin, ancestry, physical handicap, medical condition, marital status, sex or sexual orientation, in consideration for an award. 16. American with Disabilities Act. The CONTRACTORacknowledges its obligations under the Americans with Disabilities Act (ADA) in all regulations and practices pertaining thereto, including but not limited to discrimination against qualified individuals with disabilities in employment, transportation, public accommodation, telecommunications, and in all activities, programs, and services of the contractor. 17. Certified Payroll. This project requires the payment of California State Prevailing Wages. The CONTRACTORwill be required to submit certified weekly payroll reports for all workers employed on the project in a form acceptable to the Engineer and as per requirements of the State of California Department of Industrial Relations. The CONTRACTOR shall submit a "Statement of Non -Performance" for each week that no work was performed on site. Each sub -contractor shall submit a "Statement of Non -Performance" for each week that no work was performed on site, beginning with week one of the Project. 18. Registered Apprentices. CONTRACTOR shall be required to employ Registered Apprentices in accordance with Sections 1777.5 and 1777.6 of the State of California Labor Code. 19. Notary Public. All signatures on the Contract and both required surety bond forms shall be notarized on each document. 20. General Contract Conditions. The General Contract Conditions attached as Attachment "A" are binding upon CONTRACTOR and are incorporated herein as though fully set forth. 21. The Following Documents Must be Completed, Signed and Submitted. 21.1 Prior to Start of Construction 5 Attachment B (Performance Bond) Attachment C (Payment Bond) Attachment D (Certificate Regarding Contractor's License) Attachment E (Designation of Sub -Contractors) Attachment F (Certificate of Workers Compensation Insurance) Attachment G (Emergency Notification List) 21.2 During Construction Weekly Certified Payroll Statements (State of California) if requested by the City Changes to Work Schedules 21.3 At Completion of the Project Attachment H (Guarantee Agreement) Attachment I (Contractor's Certification of Completion) Attachment J (Contractor's Affidavit of Payment Attachment K (Consent of Surety for Final Payment) Attachment L (Contractor's Affidavit of Disposal) Other specific documents required in this project and referenced herein 22. Miscellaneous Provisions. A. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. B. Captions. Any captions to, or headings of, the sections or subsections of this Agreement are solely for the convenience of the parties hereto, are not a part of this Agreement, and shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof. C. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. D. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. E. Amendment to this Agreement. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. F. Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. G. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. The CON TRACTOR shall comply with all laws, including federal, state, and local laws, whether now in force or subsequently enacted. H. Entire Agreement. This Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise 6 made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. I. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. 7. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Agreement, (iv) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Agreement, or any portions hereof, or any amendments hereto. IN WITNESS WHEREOF, this Agreement is executed by CITY and by CONTRACTOR on the date and year first above written. Signature page to follow 7 CITY OF NATIONAL CITY By Ron Morrison, Mayor ARPOV y S TO FORM: C G.Si City Attom CONTACT INFORMATION CITY OF NATIONAL CITY 1243 National City Boulevard National City, CA 91950-4301 Phone: (619) 336-4583 Fax: (619) 336-4397 Contact: Byron Wade Title: Project Manager Email: Byron@projectprofessionalscorp.com PAUL W.'RAL H By: (Na (Print) PAUL W. RALPH dba WAVETEC CONSTRUCTION 3919 Grevillia Way Bonita, CA 91902 Phone: (619) 370-7444 Contact: Paul W. Ralph Title: Owner Email: Paul@YYKinc.com Taxpayer I.D. No. INSERT Contractor's License: 644292 8 ATTACHMENT A GENERAL CONTRACT CONDITIONS SECTION 3 - CONTROL OF MATERIALS 3.1 MATERIALS AND WORKMANSHIP 3.1.1 Protection of Work and Materials. 3.1.2 Property Rights in Material. Nothing in the contract shall be construed as vesting in the Contractor any right of property in the materials used after they have been attached or affixed to the work or the soil. All such materials shall become the property of the City upon being so attached or affixed. SECTION 5- DEFAULT BY THE CONTRACTOR. 5.1 General. The City will consider the Contractor in default of the Contract if prior to the Acceptance, the Contractor: a) becomes insolvent, assigns its assets for the benefit of its creditors, is unable to pay its debts as they become due, or is otherwise financially unable to complete the Work, b) abandons the Work by failing to report to the Work site and diligently prosecute the Work to completion, c) materially violates provisions of the Contract Documents, d) fails to complete the Work in the time allotted in the contract, e) disregards laws or regulations of any public body having jurisdiction, or f) commits continuous or repeated violations of regulatory or statutory safety requirements, then 5.2 Notice to Cure. The City will issue a written notice to cure the default to the Contractor and its Surety. The Contractor shall immediately commence satisfactory corrective actions after receipt of a Notice to Cure. No Notice to cure is required if the Contractor fails to complete the Work in the time allotted in the contract. 5.3 Notice of Termination for Default. If the Contractor fails to commence satisfactory corrective action within five (5) Working Days after receipt of the notice to cure, or to diligently continue satisfactory and timely correction of the default thereafter, then the City will consider the Contractor in default of the Contract and: a) will terminate the Contractor's right to perform under the Contract by issuing a written notice of termination for default to the Contractor and its Surety, b) may use any materials, equipment, tools or other facilities furnished by the Contractor to secure and maintain the Work site, and c) may furnish labor, equipment, and materials the Agency deems necessary to secure and maintain the Work site. The provisions of this subsection shall be in addition to all other legal rights available to the City. remedies The Contractor shall be entitled to no further payment until the remaining portion of the Work has been completed. The Contractor will be paid the actual amount due based on Contract Unit Prices or lump sum price and the quantity of the Work completed at the time of default, less damages caused to the City by acts of the Contractor. Costs incurred by the City in performing the Contractor's work, plus a markup of 15% on those costs for overhead, shall be deducted from monies due or to become due to the Contractor. The Contractor shall pay to the City any amount by which those costs and markup exceed the unpaid balance of the Contract Price. 5.4 Responsibilities of the Surety. Upon receipt of the written notice of termination for default, the Surety shall immediately assume all rights, obligations, and liabilities of the Contractor under the Contract. If the Surety fails to protect and maintain the Work site, the City may do so, and may recover all costs incurred. The Surety shall notify the City that it is assuming all rights, obligations and liabilities of the Contractor under the Contract and all money that is due, or would become due, to the Contractor shall be payable to the Surety as the Work progresses, subject to the terms of the Contract. Within five (5) Working Days of receipt of the written notice of termination for default, the Surety shall submit to the City a written plan detailing the course of action it intends to take to remedy the default. The City will review the plan and notify the Surety if the plan is satisfactory. If the Surety fails to submit a satisfactory plan, or if the Surety fails to maintain progress according to the plan accepted by the City, the City may, upon 48 hours written notice, exclude the Surety from the premises, take possession of all material and equipment, and complete the Work in any way the City deems to be expedient. The cost of completing the Work by the City shall be charged against the Surety and may be deducted from any monies due, or which would become due, the Surety. If the amounts due under the Contract are insufficient for completion, the Surety shall pay to the City, within 30 days after the City submits an invoice, all costs in excess of the remaining Contract Price. The provisions of this subsection shall be in addition to all other rights and remedies available to the City under law. 5.5 Payment. The Surety will be paid for completion of the Work in accordance with this Contract less the value of damages caused to the City by acts of the Contractor. SECTION 6- TERVIINATION OF THE CONTRACT FOR CONVENIENCE. The City may terminate the Contract in whole or, from time to time, in part, if it becomes impossible or impracticable to proceed, because of conditions or events beyond the control of the City. The City will issue a written notice of termination for convenience in accordance with "SPECIAL NOTICES." Upon receipt, the Contractor shall immediately proceed as follows: a) Stop Work immediately or in accordance with the Notice of Termination. b) Notify Subcontractors and suppliers to immediately cease their work and place no further subcontracts for materials, services, or facilities, except as necessary to co •plete any authorized continued portion of the Contract. c) Terminate all Subcontracts to the extent that they relate to the Work terminated. d) With approval by the Engineer, settle all outstanding obligations arising from the termination of subcontracts; the approval of which will be final for purposes of this section. e) As directed by the Engineer, transfer the title and deliver to the City, completed or partially completed drawings, plans, calculations, specifications and any other documents and records that, if the Contract had been completed, would be required to be furnished to the City. f) Complete performance of the Work not terminated. g) Take all necessary steps and actions to minimize all costs to the City as a result of the termination. h) Take any action that may be necessary, or that the Engineer may direct, for the protection and preservation of the property related to this contract that is in the possession of the Contractor and in which the City has or may acquire an interest. The Contractor will be paid without duplication for: a) work completed in accordance with the Contract Documents prior to the effective date of termination for convenience; b) reasonable costs incurred in settlement of terminated contracts with Subcontractors, suppliers and others; and c) reasonable expenses directly attributable to termination. The Contractor shall submit a final termination settlement proposal to the City no later than 90 days from the effective date of termination, unless extended, in writing, by the City upon written request by the Contractor. If the Contractor fails to submit a proposal, the City may determine the amount, if any, due the Contractor as a result of the termination. The City will pay the Contractor the amount it determines to be reasonable. If the Contractor disagrees with the amount determined by the City as being reasonable, the Contractor shall provide notice to the City within 30 days of receipt of payment. Any amount due shall be as later determined by arbitration, if the City and the Contractor agree thereto, or as fixed in a court of law. All settlements related to termination of the contract in accordance with this section will be subject to the approval of the Mayor or designee and may also require City Council approval before ultimately becoming final. 6.1 Termination Settlement. After termination, the Contractor shall submit a final termination settlement proposal to the Engineer in the form and with the certification prescribed by the Engineer. The Contractor shall submit the proposal promptly, but no later than 6 months from the effective date of termination, unless extended, in writing, by the Engineer upon written request of the Contractor within this 6 month period. If the Engineer determines that the facts justify it, a termination settlement proposal may be received and acted on after 6 months or any extension. If the Contractor fails to submit the proposal within the time allowed, the City may, in good faith, determine, on the j asis of information available, the fair and reasonable amount, if any, due the Contractor . fl, : sult of the l,•1 termination and pay the amount determined. If the Contractor does not agree that the amount determined by the Engineer is fair and reasonable and if the Contractor gives notice of such disagreement to the City in accordance with this subsection, within 30 days of receipt of payment, then the amount due shall be as later determined by arbitration, if the City and the Contractor agree thereto, or as fixed in a court of law. 6.2 Payment to the Contractor Due to Termination. Subject to 6.1, "Termination Settlement" the Contractor and the Engineer may agree upon the whole or any part of the amount to be paid because of the termination. The amount may include a reasonable allowance for profit on work done. The agreed amount may not exceed the total dollar amount authorized by the City as reduced by (1) the amount of payments previously made; and (2) the Contract Price of work not terminated. The contract shall be amended, and the Contractor paid the agreed amount. Subsection 6.3, "Failure to Agree on Payment," shall not limit, restrict, or affect the amount that may be agreed upon to be paid in accordance with this subsection. 6.3 Failure to Agree on Payment. If the Contractor and the City fail to agree on the whole amount to be paid because of the termination of Work, the City will pay the Contractor the fair and reasonable amounts determined in good faith by the City as follows, but without duplication of any amounts agreed upon. a) The Contract Price for completed services accepted by the City not previously paid or adjusted for any saving of freight and other charges. The total of: i. The costs incurred in the performance of the Work terminated, including initial costs and preparatory expense allocable thereto, but excluding any costs attributable to services paid or to be paid; ii. The fair and reasonable cost of settling and paying termination settlement proposals under terminated subcontracts that are properly chargeable to the terminated portion of the Contract if not included in subdivision "a", above; iii. A sum, as provided in subdivision "a", above, determined by the Engineer to be fair and reasonable under the circumstances; however, if it appears that the Contractor would have sustained a loss on the entire contract, had it been completed, the City will allow no profit and shall reduce the settlement to reflect the indicated rate of loss. iv. The reasonable costs of settlement of the Work terminated, including: v. Accounting, legal, clerical, and other expenses reasonably necessary for the preparation of termination of settlement proposals and supporting data; vi. The termination and settlement of subcontracts (excluding the amounts of such settlements); and vii. Storage, transportation, and other costs incurred, reasonably necessary for the preservation, protection, or disposition of property in which the City has or may acquire an interest. 6.4 Determination of Amount Due the Contractor. In arriving at the amount due the Contractor in accordance with this section, there shall be deducted: a) The fair value of property destroyed, lost, stolen, or damaged has ecome undeliverable to the City except to the extent the City expressly assumof loss; b) all un-liquidated advance or other payments to the Contractor under the terminated portion of this contract; c) any claim which the City has against the Contractor under this contract; and d) the agreed price for or the proceeds of sale of materials, supplies, or other things acquired by the Contractor or sold under the provisions of this section and not recovered by or credited to the City. 6.6 Records and Documents Relating to Termination. Unless otherwise provided in the Contract or by statute, the Contractor shall maintain all records and documents relating to the terminated portion of this contract for three (3) years after final settlement. This includes all books and other evidence bearing on the Contractor's costs, expenses, and settlement under this contract. The Contractor shall make these records and documents available to the City, at the Contractor's office, at all reasonable times, without any direct charge. If approved by the Engineer, photographs, microphotographs, and other authentic reproductions may be maintained instead of original records and documents. 6.7 Rights of the City Preserved. Where the Contract has been terminated by the City, the termination will not affect any rights or remedies of the City against the Contractor then existing or which may thereafter accrue. Any retention or payment of monies paid to the Contractor by the City shall not release the Contractor from liability. 6.9 Contract Time Extension. A claim for extension in Contract Time will not be granted unless agreed upon by the City. SECTION 7 TIME OF COMPLETION The Contractor shall have FIFTY (50) working days to complete and finalize the project. For each consecutive calendar day in excess of the time specified for completion of this portion of Work, the Contractor shall pay to the City, or have withheld from monies due it, the sum of $500 (Five Hundred Dollars per calendar day.) 7.1 Requirements Preparatory To Requesting a Walk-through. Walk-through is the procedure used by the City to generate a Punch list prior to Acceptance. The following items shall be required prior to requesting a walk-through: a) Remove temporary facilities from the Site. b) Thoroughly clean the Site. c) Provide completed and signed as-builts in a form acceptable to the City. d) Provide all material and equipment maintenance and operation instructions and/or manuals. e) Provide all tools that are a permanent part of equipment installed in the Project. f) Provide and properly identify all keys; construction and permanent. g) Provide all final Special Inspection reports required by the applicable buil. : Code. Mg h) Provide all items that this contract requires to be supplied as extra stock. All items shall be wrapped, sealed, or placed in a container as necessary to allow for storage by the City for future use. The amount specified in this contract shall be verified by the City and the Contractor. i) Ensure all EOCP documents and certified wage rate documents (if applicable) have been submitted from the NTP until Acceptance. The spare parts for the proposed irrigation system as specified in the Special Provisions (if applicable). k) See other specification sections for additional requirements. 7.1 Walk-through and Punch list Procedure. The following procedure outlines the steps to be taken upon the Contractor's assertion that the Project is complete: a) When the Contractor considers that the Work and Services are complete, the Contractor shall in writing notify the City that the Project is complete and request that the City perform a walk-through for generation of a Punch list. The Contractor shall notify the City at least seven (7) days in advance of the time the walk-through is to be performed. b) The City will determine if the Contractor is ready for a walk-through by verifying whether the Contractor has provided or completed all items, whether the Contractor has obtained the applicable certifications, and by evaluating completeness by inspecting the Project and the specified Work required by the Contract Documents. c) The City will facilitate a walk-through. d) The Contractor shall make available at the Site for walk-through attendees the plans and specifications and the technical data such as submittals and equipment manuals. e) The City will generate the Punch list within two (2) Working Days from the date of the walk-through and submit it to the Contractor. f) If, at any time during the City's evaluation of the corrective Work required by the Punch list, the City discovers that additional corrective Work is required, the City may include that corrective Work in the Punch list. The Contractor shall be solely responsible for the Site until the Project is completely operational, all Punch list items have been corrected, and all operation and maintenance manuals have been accepted by the City. g) The City will meet with the Contractor until all Punch list items are corrected. h) All corrective work must be completed within the original contract time allotted. i) Upon Acceptance, the Contractor shall assemble and deliver to the City all records, documents, warranties, material certifications, bonds, guarantees, maintenance and service agreements, and maintenance and operating manuals. Written warranties, except manufacturer's standard printed warranties, shall be on the Contractor's and the Contractor's agents, material suppliers, installers, or manufacturer's le ad, address to the Contractor. Warranties shall be submitted in the format described in this se p on, modified as approved by the City to suit the conditions pertaining to the w my J) 7.2 RETENTION. In lieu of a 5% retention as required by the Public Contracts Code, the Contractor shall provide unconditional releases from all suppliers and subcontractors for any and all work done at the Property. SECTION 8- LIQUIDATED DAMAGES. Failure of the Contractor to complete the Work within the time allowed will result in damages being sustained by the City. Such damages are, and will continue to be, impracticable and extremely difficult to determine. For each consecutive calendar day in excess of the time specified for completion of the Work, the Contractor shall pay to the City, or have withheld from monies due it, the sum of $500 Five Hundred Dollars per calendar day. Execution of the Contract shall constitute agreement by the City and the Contractor that Five Hundred Dollars ($500) per day is the minimum value of the costs and actual damages caused by the failure of the Contractor to complete the Work within the allotted time, that such sum is liquidated damages and shall not be construed as a penalty, and that such sum may be deducted from payments due the Contractor if such delay occurs. The City and Contractor agree that time is of the essence for this project and that the City may at its discretion demand delivery of the Property and close of escrow if the Work is not complete within the time allotted for this contract. However, it is the intent of the parties that the contract time can be extended by the City for reasonable causes outside of the control of the Contractor if the City upon its own determination can delay the occupation of the Property. SECTION 9- GUARANTEE In conjunction with the manufacturer's warranty/guarantee for all products provided and in accordance with the executed guarantee agreement, all work shall be guaranteed by the Contractor for a period of one (1) year from the date of acceptance of the work against defective workmanship and materials furnished by the Contractor. The Contractor shall promptly replace or repair, in a manner satisfactory to the Engineer, any such defective work, after notice to do so from the Engineer, and upon the Contractor's failure to make such replacement or repairs promptly, the City may perform this work and the Contractor and his surety shall be liable for the cost thereof. SECTION 10 - RESPONSIBILITIES OF THE CONTRACTOR 10.1 LABOR 10.1.2 Laws. Pursuant to Sections 1720 et seq. and 1770 et seq. of the California Labor Code, the successful bidder shall pay not less than the prevailing rate of per diem wages as determined by the Director of the California Department of Industrial Relations. Copies of such prevailing rate or per diem wages are on file in the City Engineer's office, which copies shall be made available to any interested party on request at the posted reproduction charge. The successful bidder shall post a copy of such wage determinations at each job site. SECTION 11- PROJECT SITE MAINTENANCE 11.1 General. Contractor shall recycle all designated recyclable materials in compliance with the City of National City Municipal Code Chapter 15.80, Construction and Demolition Debris (Ordinance No. 2009-2309). Such materials are, but not limited to, concrete, asphalt, dirt, metals, road base material, wood waste, paper products and tree trimmings. Further, the higher economic costs of landfill disposal versus the lower cost of recycling disposal make it in each contractor's best interest to recycle as much as possible. Proof of compliance with City of National City Municipal Code Chapter 15.80 shall be provided by both completing the Contractor's Affidavit of Disposal, and fulfilling the requirements of Chapter 15.80, including proof of diversion regardless of disposal site. SECTION 12- WATER POLLUTION CONTROL SITE MANAGEMENT (SWPPP) AND GENERAL ENVIRONMENTAL CONDITIONS. 12.1 General. At a minimum, the Contractor shall be required to do the following: Protect all new and existing storm water conveyance system structures from sedimentation and concrete rinse, or other construction related debris and discharges with gravel bags and filter fabric or by any other equal product that is approved by the Resident Engineer. Temporary gravel bags shall be installed, maintained, and later removed as approved by the Resident Engineer. The Contractor will not be paid any additional money for the maintenance, removal and replacement of gravel bag at the same location. Gravel bags fill material shall be one-half to one -inch Class 2 aggregate base, clean and free from clay and deleterious material. Gravel bag fabric shall be woven high -density polyethylene fabric with a minimum unit weight of 5 oz./square yard. The fabric shall have a Mullen burst strength of at least 350 psi, conforming to the requirements of ASTM Designation D 3786, and an ultraviolet (UV) stability exceeding 70 percent. Gravel bags, when filled, shall have nominal dimensions (length x width x height) of 16 in. x 12 in. x 6 in., and a fill mass of 35 to 60 pounds. The Contractor shall use other methods if ponding will encroach in to the traffic or onto erodible surfaces and slopes. Flow from a severe storm shall not overtop the curb. Temporary gravel bags shall be maintained to provide for adequate sediment holding capacity. The Contractor shall remove the sediment behind the barrier when it reaches one-third the height of the barrier and immediately before and after each storm event. When no longer required for the intended purpose, temporary gravel bag barriers shall be removed from the site of work. Storm drain inlet sediment control measures shall be of sufficient capacity and dimensions so as to handle received flows and debris without blocking or diverting flows from the inlets. Area around the inlet shall be provided for water to pond without flooding structures and property. The storm drain inlet sediment control measures shall not impede the safe flow of traffic. The storm drain inlet sediment control measures shall be of sufficient weight so as not to shift out of place, or shall be secured in place against movement. Protect all drainage structures within 100 Feet of the work if there is a threat to water quality. Inlet sediment control measures shall be maintained daily or more often if needed. Maintaining inlet sediment control measures shall include removing and disposing of accumulated trash & debris when depth exceeds one -third the height of filter/trap. Waste materials shall be removed and disposed in accordance with the Green Book Maintaining inlet sediment control protect' on shall also include daily checks for excessive debris and for damaged inlet sediment contr measures. Damaged inlet sediment control measures shall be repaired or replaced i -diately. g! When storm drain inlet protection is no longer required for the work, as approved by the Resident Engineer, the inlet sediment control measures shall be completely removed. Storm drain inlet protection shall not be removed until upstream soils are stabilized. Materials for inlet sediment control shall become the property of the contractor and shall be removed from the site of the work and disposed off -site as specified in the contract. It is the contractor's responsibility to insure that the BMP's are operational and working properly. Furthermore, the Contractor shall be held responsible for any citation and/or fine due discharges or malfunctioning of the BMP's. Contractor shall be responsible for any and all other best management practices (BMPs) that are a threat to the water quality as deemed necessary by the City Engineer. Compensation shall be paid under the various line items. No additional compensation shall be paid. 12.2 ENVIRONMENTAL PROTECTION. The Contractor shall comply with all applicable standards, orders, or requirements of the Environmental Protection Agency regulations (40 CFR, Part 15). 12.3 FLOOD DISASTER PROTECTION ACT OF 1973.The Contractor shall comply with all applicable standards, orders, or requirements of the Flood Disaster Protection Act of 1973 (42 USC 4001 etseq, as amended). 12.4 GRAFFITI CONTROL. The Contractor shall maintain all site improvements, including any temporary facilities, equipment or other materials in a graffiti free condition throughout the construction period, until acceptance of the project by the City. Graffiti encountered on the job site shall be removed by the Contractor within twenty-four (24) hours. Costs for removal shall be included in the various items of work. 12.5 NOISE ABATEMENT AND CONTROL. The Contractor shall comply with the provisions of the City of National City Municipal Code, Noise Abatement and Control, and the County of San Diego Code of Regulatory Ordinances, Noise Abatement and Control. In the event of conflict, the most stringent requirement shall apply. If the Contractor chooses to conduct work activities during times when a Noise Permit is required, the Contractor shall apply for, obtain, and pay for the Noise Permit at no additional cost to City. The Contractor shall coordinate their activities in such a way that minimizes the disturbance with the any adjacent or nearby schools. The Contractor shall attend any coordination meetings with any schools. The cost of noise mitigation and coordination efforts shall be included in the various items of work and there shall be no additional costs to the City. 12.6 Project Appearance. The Contractor shall maintain a neat appearance to the work. In any area visible to the public, the following shall apply: a. When practicable, broken concrete and debris developed during clearing and grubbing shall be disposed of concurrently with its removal. If stockpiling is necessary, the material shall be removed or disposed of weekly. b. The Contractor shall furnish trash bins for all debris from s c e cons ction. All debris shall be placed in trash bins daily. Forms and false -work that are to!6e d shall be i stacked neatly concurrently with their removal. Forms and false -work that are not to be re -used shall be disposed of concurrently with their removal. c. Full compensation for conforming to the provisions in this section shall be considered as included in prices paid for the various contract items of work involved and no additional compensation will be allowed. 12.7 Sound Control Requirements. The Contractor shall comply with all local sound control and noise level rules, regulations and ordinances, which apply to any work performed pursuant to the contract. Each internal combustion engine, used for any purpose on the job or related to the job, shall be equipped with a muffler of a type recommended by the manufacturer. No internal combustion engine shall be operated on the project without said muffler. If required see the attached Mitigated Negative Declaration Document in the appendices. 12.8 Hazardous Waste. If the Contractor encounters material in demolition or work that he has reason to believe may be hazardous waste, as defined by Section 25117 of the Health and Safety Code, he shall immediately so notify the Engineer in writing. Demolition in the immediate area of the suspected hazardous material shall be suspended until the Engineer authorizes it to be resumed. If such suspension delays the current controlling operation, the Contractor will be granted an extension of time as agreed to between the parties. The City reserves the right to use other forces for exploratory work to identify and determine the extent of such material and for removing hazardous material from such area. SECTION 13- PROTECTION AND RESTORATION OF EXISTING IMPROVEMENTS 13.1 Contractor shall replace/repair any property or private improvements, which are damaged or removed as a result of its operations to current City of National City standards and to the satisfaction of the City Engineer in an as good or better condition. Contractor will take measures to minimize inconvenience to the City, including but not limited to: a. Advance notification of the impending work and the estimated duration of the work. b. Care in access to and from the building by the Contractor's equipment, materials and/or personnel. c. Private property and improvements must be repair, restored and/or replaced within 7 days of the completion of the adjacent work. The cost of protecting, removing and restoring of items necessary to complete the work shall be included in the various line items of work and there shall be no additional cost to the City. SECTION 14-PROJECT SAFETY Section 14.1-Safety Orders. The Contractor shall be solely and completely responsible for conditions on the job site, including safety of all persons (including employees) and property during performance of the work. This requirement shall apply continuously and is not limited to normal working hours. Safety provisions shall conform to U.S. Depaitutt •f Labor, the als California Occupational Safety and Health Act (OSHA), and all other applicable Federal, State, County, and City laws, ordinances, codes, the requirements set forth below, and any regulations that may be detailed in other parts of these documents. Where any of these are in conflict, the more stringent requirement shall be followed. The Contractor's failure to thoroughly familiarize himself with the aforementioned safety provisions shall not relieve him from compliance with the obligations and penalties set forth herein. The Contractor shall develop and maintain for the duration of this contract, a safety program that will effectively incorporate and implement all required safety provisions. The Contractor shall appoint an employee who is qualified and authorized to supervise and enforce compliance with the safety program. The duty of the City and its consultants is to conduct construction review of the Contractor's performance and shall not include a review or approval of adequacy of the Contractor's safety supervisor, the safety program, or any safety measures taken in, on, or near the construction site. If death or serious injuries or serious damages are caused, the accident shall be reported immediately by telephone or messenger to the City's inspector or other representative. In addition, the Contractor must promptly report in writing to the City all accidents whatsoever arising out of or in connection with, the performance of the work whether on, or adjacent to the site, giving full details and statements of witnesses. 14.2 Public Safety During Non -Working Hours. Notwithstanding the Contractor's primary responsibility for safety on the job site when the Contractor is not present, the Engineer, at his option after attempting to contact the Contractor, may direct City forces to perform any functions he may deem necessary to ensure public safety at or in the vicinity of the job site. If such procedure is implemented, the Contractor will bear all expenses incurred by the City. In all cases the judgment of the Engineer shall be final in determining whether or not an unsafe situation exists however this does not alleviate the contractor's responsibility and liability to maintain a safe worksite at all times. SECTION 15- PROJECT CLOSEOUT 15.1 Cleanup. In addition to the requirement that the job site be kept clean during the progress of the work, the contractor is similarly obligated to thoroughly clean up the construction site at the end of the job before the work can be accepted. Final acceptance of work will be withheld until the contractor has satisfactorily complied with all of the requirements for final cleanup of the project site. Disposal of all waste and refuse shall be at the contractor's expense. No waste or rubbish of any nature is allowed to be disposed of at the site except upon receipt of written approval by the City. 15.2 Final Inspection. When the work is completed satisfactorily, and in accordance with the terms of the contract, the contractor shall submit a written request to the Engineer and Building Department for the final inspection. Upon receiving such notification from the contractor, the City will arrange for the final inspection of the work. The representative of the contracto . the subcontractors should participate in the inspection tour to respond to any questions that may be raised by the representative of the City. Prior to, but in no case later than, the pre -final inspection period, dates should be established for equipment testing, systems validation, acceptance periods, warranty dates, and instructional requirements that may be required by the contract. Following the pre -final inspection of the work, the City's representative will prepare a Punch List setting forth in accurate detail any items of work that have been found to be not in accordance with the requirements of the contract documents. When notified by the contractor that all of the pre -final Punch List items have been completed, the Engineer and his/her representative accompanied by the representatives of the other City Departments with the presence of the Contractor will conduct the final inspection of the work. Then, if all punch list items have been completed satisfactorily, and if no new items are discovered, the final inspection date will be considered as the completion date for the project. If, following the final inspection of any portion of the work, there remains a question as to whether one or more Punch List items have not been properly completed, but otherwise the overall project is substantially complete, the Engineer may issue an updated Punch List and consider the final inspection date as the completion date if the contractor completes the updated punch list items within a specified period of time. 15.4 Acceptance. The project will be scheduled for the City Council's acceptance if the following items are satisfactorily met: a. The work has been completed satisfactorily, and in accordance with the terms of the contract. b. All of the punch list items have been completed and the project is accepted by the Engineer and signed off as complete and acceptable by the City Building Department. c. Record (As -built) drawings have been submitted and accepted by the Engineer. d. All of the payroll records (contractor and subcontractors) have been submitted and accepted if requested by the City. e. Operating manuals and instructions for equipment items, keying schedule, maintenance stock items, certifications of inspection, and systems validation have been submitted. f. Guarantee Agreement is submitted to and accepted by the Engineer. g. Contractor's Certificate of Completion, Affidavit of Disposal, Affidavit of Payment, Consent of Surety for Final Payment have been signed and submitted to the Engineer. h. Contract Final Balance has been approved or conditionally approved by the Contractor and submitted to the Engineer. i. Notice of Completion will be filed with the County Recorder once all of the above listed items are complete. j. Occupancy is allowed by the Building Official. 726 W 19th Street, National City, CA 91950 Construction Contract PERFORMANCE BOND (Attachment B) WHEREAS, the City of National City has awarded to , hereinafter designated as the "Principal", the CITY OF NATIONAL CITY CONSTRUCTION CONTRACT BY AND BETWEEN THE CITY OF NATIONAL CITY AND PAUL W. RALPH WHEREAS, said Principal is required under the terms of said contract to furnish a bond for the faithful performance of said contract. NOW, THEREFORE, we, the Principal and as surety, are held and firmly bound unto the City Council of the City of National City, hereinafter called the "Council", in the penal sum of ($ ) lawful money of the United States, for the payment of which sum well and truly to be made, we bind ourselves, our heirs, executors, administrators and successors, jointly and severally, firmly by these presents. THE CONDITION OF THIS OBLIGATION IS SUCH THAT if the above bounden Principal, his/her or its heirs, executors, administrators, successors or assigns, shall in all things stand to and abide by, and well and truly keep and perform the covenants, conditions and agreements in the said contract any alteration thereof made as therein provides, on his or their part, to be kept and performed at the time and in the amount therein specified, and in all respects according to their true intent and meaning, and shall indemnify and save harmless the City of National City, the City Council, their officers, agents, and employees, as therein stipulated, then this obligation shall become null and void; otherwise it shall be and remain in full force and virtue. And the said Surety, for value received, hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms of the contract or to the work to be performed herein or the specifications accompanying the same shall in any wise affect its obligations on this bond, and it does hereby waive notice of any such change, extension of time, alteration or additions to the terms of the contract or to the work or to the specifications. 726 W 19th Street, National City, CA 91950 Construction Contract PERFORMANCE BOND (continued) In the event suit is brought upon this bond by the City of National City and judgment is recovered, the surety shall pay all costs incurred by the Council in such suit, including a reasonable attorney's fee to be fixed by the Court. IN WITNESS WHEREOF three identical counterparts of this instrument, each of which shall for all purposes be deemed an original thereof, have been duly executed by the Principal and Surety above named, on the day of , 2014. (SEAL) (SEAL) (SEAL) (SEAL) (SEAL) (SEAL) Surety Principal 726 W 196 Street, National City, CA 91950 Construction Contract PERFORMANCE BOND (continued) ATTORNEY -IN -FACT ACKNOWLEDGEMENT OF SURETY STATE OF ) ss COUNTY OF ) On this day of , 2014, before me, the undersigned, a Notary Public in and for said County and State, personally appeared known to me to be the person whose name is subscribed to the within instrument as the attorney -in -fact of the , the corporation named as Surety in said instrument, and acknowledged to me that he subscribed the name of said corporation thereto as Surety, and his own name as attorney -in -fact. NOTE: Signature of those executing for Surety must be properly acknowledged. NOTE: The Attorney -in -fact must attach a certified copy of the Power of Attorney. Signature: Name (Type or Print): Notary Public in and for said County and State My Commission expires: 726 W 19th Street, National City, CA 91950 Construction Contract PAYMENT BOND (Attachment C) WHEREAS, the City of National City has awarded "Principal", the , hereinafter designated as the CITY OF NATIONAL CITY CONSTRUCTION CONTRACT BY AND BETWEEN THE CITY OF NATIONAL CITY AND PAUL W. RALPH WHEREAS, said Principal is required by Chapter 5 (commencing at Section 3225) and Chapter 7 (commencing at Section 3247), Title 15, Part 4, Division 3 of the California Civil Code to furnish a bond in connection with said contract; NOW, THEREFORE, we, the Principal and as surety, are held and firmly bound unto the City Council of the City of National City, hereinafter called the "Council", in the penal sum of lawful money of the United States, for the payment of which sum well and truly to be made, we bind ourselves, our heirs, executors, administrators and successors, jointly and severally, firmly by these presents. THE CONDITION OF THIS OBLIGATION IS SUCH that if said Principal, his/her or its subcontractors, heirs, executors, administrators, successors, or assigns, shall fail to pay any of the persons named in Section 3181 of the California Civil Code, or amounts due under the Unemployment Insurance Code with respect to work or labor performed by any such claimant, or for any amounts required to be deducted, withheld, and paid over to the Franchise Tax Board from the wages of employees of the Contractor and his subcontractors pursuant to Section 18806 of the Revenue and Taxation Code, with respect to such work and labor the Surety will pay for the same in an amount not exceeding the sum hereinafter specified, and also, in case suit is brought upon this bond, a reasonable attorney's fee, to be fixed by the Court. This Bond shall inure to the benefit of any of the persons named in Section 3181 of the California Civil Code, so as to give a right of action to such persons or their assigns in any suit brought upon this bond. 726 W 19`h Street, National City, CA 91950 Construction Contract PAYMENT BOND (continued) It is further stipulated and agreed that the Surety on this bond shall not be exonerated or released from the obligation of this bond by any change, extension of time for performance, addition, alteration or modification in, to, or of any contract, plans, specifications, or agreement pertaining or relating to any scheme or work of improvement hereinabove described or pertaining or relating to the furnishing of labor, materials, or equipment therefore, not by any change or modification of any terms of payment or extension of the time for any payment pertaining or relating to any scheme or work of improvement hereinabove described, nor by any rescission or attempted rescission of the contract, agreement or bond, nor by any conditions precedent or subsequent in the bond attempting to limit the right of recovery of claimants otherwise entitled to recover under any such contract or agreement or under the bond, nor by any fraud practiced by any person other than the claimant seeking to recover on the bond and that this bond be construed most strongly against the Surety and in favor of all persons for whose benefit such bond is given, and under no circumstances shall Surety be released from liability to those for whose benefit such bond has been given, by reason of any breach of contract between the owner of Public Entity and original contractor or on the part of any obliges named in such bond, but the sole conditions of recovery shall be that claimant is a person described in Section 3110 or 3112 of the California Civil Code, and has not been paid the full amount of his claim and that Surety does hereby waive notice of any such change, extension of time, addition, alteration or modification herein mentioned. IN WITNESS WHEREOF three identical counterparts of this instrument, each of which shall for all purposes be deemed an original thereof, have been duly executed by the Principal and Surety above named, on the day of , 2014. (SEAL) (SEAL) (SEAL) (SEAL) (SEAL) (SEAL) Surety Principal 726 W 19`h Street, National City, CA 91950 Construction Contract PAYMENT BOND (continued) ATTORNEY -IN -FACT ACKNOWLEDGEMENT OF SURETY STATE OF ) COUNTY OF ) ss On this day of , 2014, before me, the undersigned, a Notary Public in and for said County and State, personally appeared known to me to be the person whose name is subscribed to the within instrument as the attorney -in -fact of the , the corporation named as Surety in said instrument, and acknowledged to me that he subscribed the name of said corporation thereto as Surety, and his own name as attorney -in -fact. NOTE: Signature of those executing for Surety must be properly acknowledged. NOTE: The Attorney -in -fact must attach a certified copy of the Power of Attorney. Signature: Name (Type or Print): (Notary Public in and for said County and State) My Commission expires: 726 W 19th Street, National City, CA 91950 Construction Contract CERTIFICATE REGARDING CONTRACTOR'S LICENSE (Attachment D) 1. Contractor is required to possess one of the following State Contractor's License: State of California Class "B" Contractor's License 2. A failure to possess the required license, a failure to truthfully set forth the following information, or a failure to execute this Certificate renders the proposal nonresponsive and requires the City to reject the proposal. (Business and Professions Code Section 7028.15) 3. Contractor declares, under penalty of perjury, that he possesses the required Contractor's license(s) which: a. Bears the license number(s): b. Expires on: Signature of Prime Contractor Date Signature of Prime Contractor Date Print name and title Print name and title (If the Prime Contractor is a corporation two signatures of corporate officers are required.) This required license determination has been made by the City of National City. Any Contractor holding a different license who feels he is qualified to bid on this work must so advise the City Engineer at least seven (7) days prior to the bid opening. A review of the contemplated work will be made and the City's decision as to the required license will be final. 1-1 726 W 19th Street, National City, CA 91950 Construction Contract DESIGNATION OF SUBCONTRACTORS (Attachment E) In compliance with the provisions of the Subletting and Subcontracting Fair Practices Act (Section 4100 et sec of the Government Code of the State of California) the undersigned Prime Contractor has set forth below the full name and the location of the place of business of each Subcontractor who will perform work or labor or render service to the Prime Contractor in or about the construction of the work or improvement, or a Subcontractor licensed by the State of California who, under subcontract to the Prime Contractor, specially fabricates and installs a portion of the work or improvement according to detailed drawings contained in the plans and specifications to which the attached bid is responsive, and the portion of the work which will be done by each Subcontractor for each subcontract in excess of one- half of one percent of the Prime Contractor's total bid. The Prime Contractor understands that if he fails to specify a subcontractor for any portion of the work to be performed under the contract in excess of one-half of one percent of his bid, he shall be deemed to have agreed to perform such portion of the work with contractor's own forces. Substitution shall not be allowed, except in cases of public emergency or necessity, and then only after a finding, reduced to writing as a public record of the City, setting forth the facts constituting the emergency or necessity. If no subcontractors are to be employed on the project, enter the word "NONE". Item # Subcontractor Description of Work % of Item Use an additional sheet and attach if necessary. Number of sheets attached for listed subcontractors Percentage (%) of total contract amount that is subcontracted % (Do not include specialty items in the calculation.) Signed this day of , 2013. Signature of Prime Contractor Date Signature of Prime Contractor Date Print name and title Print name and title 1-2 726 W 19`h Street, National City, CA 91950 Construction Contract CONTRACTOR'S CERTIFICATE OF WORKER'S COMPENSATION INSURANCE (Attachment F) Section 3700 of the Labor Code provides in part as follows: "Every employer except the state shall secure the payment of compensation in one or more of the following ways: (a) By being insured against liability to pay compensation to one or more insurers duly authorized to write compensation insurance in this state. (b) By securing from the Director of Industrial Relations a certificate of consent to self -insure, which may be given upon furnishing proof satisfactory to the Director of Industrial Relations of ability to self -insure and to pay any compensation that may become due to his employees. I am aware of the provisions of Section 3700 of the Labor Code, which require every employer to be insured against liability for worker's compensation or to undertake self-insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of this contract. I further certify that if I should contract or subcontract with any person, including firm or company, to do all or any part of the work for which this proposal covers, I shall assure compliance by that contractor or subcontractor with the provisions of Section 3700 of the Labor Code. (Legal Name of Prime Contractor) By: Title: (In accordance with Article 5, commencing at Section 1860, Chapter 1, Part 7, Division 2, of the Labor Code, the above certificate must be signed and filed with the awarding body prior to performing any work under this contract.) 1-3 726 W 19th Street, National City, CA 91950 Construction Contract EMERGENCY NOTIFICATION LIST (Attachment G) My/our representatives at the construction site for the above subject project will be: On -site Project Superintendent: Name Cell number/Office number Other 24-hour available person with authority to order work: Name Cell number/Office number Other 24-hour available person with authority to order work: Name CeII number/Office number I am aware that one of the named representative(s) shall be present at the work site whenever work is in progress. Further, each of these responsible persons can be contacted in an emergency situation and have complete authority to act on the Contractor's behalf. Signature of Prime Contractor Signature of Prime Contractor Print name and title Print name and title (If the Prime Contractor is a corporation two signatures of corporate officers are required.) 1-4 726 W 19th Street, National City, CA 91950 Construction Contract GUARANTEE AGREEMENT (Attachment H) We hereby guarantee that structural and real property improvements to the real property located at 726 W. 19th Street, National City, CA 91950 have been installed in accordance with CITY OF NATIONAL CITY CONSTRUCTION CONTRACT BY AND BETWEEN THE CITY OF NATIONAL CITY AND PAUL W. RALPH and all drawings and specifications thereto and guarantee that the work as installed will fulfill the requirements included in the specifications of that Contract. The undersigned agrees to promptly repair or replace, in a manner satisfactory to the Engineer, any or all of such work, together with any other adjacent work which may be displaced in connection with such repair or replacement, that may prove to be defective in workmanship or material within a period of one (1) year from the date of acceptance of the above referenced project by the CITY, ordinary wear and tear and unusual abuse or neglect excepted. The Contractor also agrees to hold the CITY harmless from claims of any kind arising from damage due to said defects in the work constructed under the Contract. In the event that the undersigned fails to comply with the abovementioned conditions within a reasonable period of time, as determined by the CITY, the undersigned hereby authorizes the CITY to proceed with the repair of said defects and the Contractor and his/her surety shall be liable to the City for the cost thereof. Firm name Address Signature of Prime Contractor or Sub -Contractor Signature of Prime Contractor or Sub -Contractor Print name and title Print name and title Countersigned (required by Prime Contractor if this Guarantee Agreement is for a Sub -Contractor): Firm name Address Signature of Prime Contractor Signature of Prime Contractor Print name and title Print name and title Contact for Service: Name Address Telephone number and email address 726 W 19th Street, National City, CA 91950 Construction Contract CONTRACTOR'S CERTIFICATION OF COMPLETION (Attachment I) DATE: TO: City Engineer City of National City Engineering Department 1243 National City Boulevard National City, CA 91950 FROM: (Firm or Corporation) This is to certify that I, acting as an authorized official of the above stated firm or corporation, have been properly authorized by said firm or corporation to sign the following statements pertaining to the subject contract: I know, of my own personal knowledge, and do hereby certify, that the work of the contract described above has been performed, and materials used and installed in every particular, in accordance with, and in conformity to, the contract drawings and specifications. The contract work is now complete in all parts and requirements, and ready for your final inspection. I understand that neither the determination by the Engineer that the work is complete, nor the acceptance thereof by the Owner, shall operate as a bar to claim against the Contractor under the terms of the guarantee provisions of the contract documents. Signature of Prime Contractor Signature of Prime Contractor Print name and title Print name and title (If the Prime Contractor is a corporation two signatures of corporate officers are required.) 726 W 19th Street, National City, CA 91950 Construction Contract CONTRACTOR'S AFFIDAVIT OF PAYMENT (Attachment J) To All Whom It May Concern: WHEREAS, the undersigned has been contracted by the City of National City to furnish labor, materials, and equipment for the CITY OF NATIONAL CITY CONSTRUCTION CONTRACT BY AND BETWEEN THE CITY OF NATIONAL CITY AND PAUL W. RALPH, under a contract dated the day of , 2014, in the City of National City, County of San Diego, State of California, of which City of National City is the Owner. NOW, THEREFORE, this day of , 2014 the undersigned, as the Contractor for the above -named Contract pursuant to the Conditions of the Contract hereby certifies that, except as listed below, he has paid in full or has otherwise satisfied all obligations for all materials and equipment furnished, for all work, labor, and services performed, and for all known indebtedness and claims against the Contractor for damages arising in any manner in connection with the performance of the Contract referenced above for which the Owner or his property might in anyway be held responsible. EXCEPTIONS: (If none, write "None". If required by the Owner, the Contractor shall furnish bond satisfactory to the Owner for each exception.) Signature of Prime Contractor Date Signature of Prime Contractor Date Print name and title Print name and title (If the Prime Contractor is a corporation two signatures of corporate officers are required.) 726 W 19th Street, National City, CA 91950 Construction Contract CONSENT OF SURETY FOR FINAL PAYMENT (Attachment K) In accordance with the provisions of the contract between the City and the Contractor, and the following named Surety: on the Payment Bond in the amount of Dollars, of the following named Contractor: hereby approves of final payment to the Contractor, and further agrees that said final payment to the Contractor shall not relieve the Surety named herein of any of its obligations to the City of National City, California, as set forth in said Surety company's bond. IN WITNESS WHEREOF, the Surety Company has hereunto set its hand and seal this day of , 2014. (CORPORATE SEAL) Signature of Authorized Surety Representative Title 726 W 19th Street, National City, CA 91950 Construction Contract CONTRACTOR'S AFFIDAVIT OF DISPOSAL (Attachment L) WHEREAS, on the day of 2014, the undersigned entered into and executed a contract with the City of National City, a municipal corporation, for structural and real property improvements to the real property located at 726 W. 19th Street, National City, CA as particularly described in the contract entitled CITY OF NATIONAL CITY CONSTRUCTION CONTRACT BY AND BETWEEN THE CITY OF NATIONAL CITY AND PAUL W. RALPH. WHEREAS, the specifications of said contract requires the Contractor to affirm that "all brush, trash, debris, and surplus materials resulting from this project have been disposed of in a legal manner" and that all designated recyclable materials are properly recycled in compliance with the City of National City Municipal Code, Chapter 15.80, Construction and Demolition Debris (Ordinance No. 2009-2309). WHEREAS, said contract has been completed, all surplus materials disposed of, and proof of compliance with the City of National City Municipal Code has been furnished. NOW, THEREFORE, in consideration of the final payment by the City of National City to said Contractor under the terms of said contract, the undersigned Contractor, hereby certifies and affirms under penalty of perjury that all surplus materials as described in said contract have been disposed of at the following location(s): Type of material disposed of Type of material disposed of Name of disposal site Name of disposal site Address of disposal site Address of disposal site Type of material disposed of Type of material disposed of Name of disposal site Name of disposal site Address of disposal site Address of disposal site By signing and submitting this form to the City of National City on this day of , 2014, I (we) hereby certified and swear under penalty of perjury under the laws of the State of California that the aforementioned information is true and correct without omission, error or misrepresentation. Signature of Prime Contractor Date Signature of Prime Contractor Date Print name and title Print name and title (If the Prime Contractor is a corporation two signatures of corporate officers are required.) CONSTRUCTION CONTRACT 726 W. 19TH STREET EXHIBIT "A" Scope of Work Contractor shall: 1. Provide all services and all labor, materials, and equipment to construct all improvements indicated on the plans, details and notes attached hereto as Exhibit "A", including but not limited to: a. Prepare, amend, and submit permitable plans for all improvements that conform to Exhibit "A" and all code requirements. b. Obtain and pay for all permits as required (Traffic control permits shall be no fee). c. Perform all demolition as required. d. Dispose and recycle all materials as required. e. Design, permit, and install an interior fire sprinkler system with water service to water main and backflow preventer. f. Provide, install, and construct perimeter fencing with automatic gate. g. Provide, install, and construct all interior tenant improvements. h. Provide all bonding and insurance. i. Provide all management and supervision. j. Deliver complete building and site ready for occupancy and use. k. Deliver completed and signed off permits, certificates, warranties, and close-out documents. I. Complete the work within the specified period of time. City shall: 1. Provide expedited plan review. as € by t 1 i f i i i t 1 a 1 OSITE PLAN re = ra 2' NIGH STEEL FENCE ON TOP OF WALL 20' ROLLING GATE PROVIDE STRIPING AND SIFNAGE FIR ACCESSIBLE PARKING REDIRECT DRAIN ONTO PROPERTY 19TH STREET PROPERTY LINE 50.07' x X- REPAINT / STEPS AND UNDERSIDE IF I.„c-.' 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MR USSR ACMON Mr R 16AIRD AT IMASI RR 11*1!1IS AY, PRM MY OTW3 PPM O• PO OAR MO WOE ,Mt U. ISPM•9MI FM MAGI ToY ODNPIORM WS 10 OPERA. AA: MW0401ROp C EARLY 51 E CMMTI IOV A301114 MIME 10 MVP/ 40404 ND IOC R(Y43AY MRMMG0 W.I. 1. RM um. 4w1 Yr MRO3r0 larMNNT arms IW 4I M10 MIRNPfe n .DEwY son S rrm or al4WE rt tiM.UP M ACOMM UPI ISMS/ACIOkRS MsrA LAIOR 30mocas Om . L .DOCR• 10 PISTOL M mama IMr-mirror room WI oro-co ! t A. rM MGFT4 WAS, DMr-R.OE IRO root O.r110 WAILM!WDm RS411 r{ �p i. M 00s4�M PO ma. xi some Ie 43Ew0 IC-02 1 flK R4 RE 10OMLYeT xMpMLLa rl/MCWFRE11 .00A,u1 imerreirMairo mom CITY DR WIC/NAL= g I�4 M• a NILSON AVENUE ,i, 11 �I ))9(� A Pnm 42— g —armor :AK � � � ''jam.' Iate0I43_ 'mom Xer.00l to. IOI IMF �V. A wM • V ...pap ,op 1 emli+ smP XXXXXX D• EXHIBIT "A" OWN WI rasnovire > AMA. assIs ISOdx4 Lon El .9EE NOCtOrk AM anaIA MOLLVAa'Ia iI/ I _III IAI<�IIII■III�IIdII�I'1•iUl. ®I■�•IWIi .9L AL ZSOW MS • s1vR80 IT( • �aiox 'O'O LSLY r SLY Lt/E E] AWE 1 avu.n.u. Lww.tl£ zcl ♦sw,SLZt Lail] • .0019E L961 00'96 Lore ozl Lora SL'a .00'OE LSOa OPIDiO. v.I __ I JI_d_PrJI i i I I 1 W Lei Hatrl • „vo ,LIHIHX3 EXHIBIT "A" LATCH POST LATCH DETAIL {NOT APPLICABLE ONBI-PARTBJG GATES) Cb V-GROOVE WHEEL DETAIL, POST GUIDE ROLLER DETAIL (ORNAMENTAL PICKET SHOWN) WV* Nt1012 EXHIBIT "A" The Traditional Entry Gate Solution The PassPort roll gate system has been redesigned to It a wide variety of heights and openings. The PassPort v-back design provides the least amount of space required for a slide gate and the greatest Installation flexibility. Robust PassPort II Is an Innovative roll gate system with a robust fabricated design. The PassPort roll gates have a rigid framework that enables the gate system to glide effortlessly across its on -grade track. Versatile All PassPort gates are designed with versatility In mind. The reversible design of the PassPort roll gate Insures a flawless Installation by allowing the gate to be installed one either side of the gate opening. Durable PassPort's fully welded construction and PermaCoat finish give this V-track roll gate the durability and strength required for limitless gate cycles. M MADE III USA We take great pride In manufacturing 'Made In the USA" products. Ameristar Is located In Tulsa, Oklahoma and Is American owned and operated. Applications: > Water Treatment & Storage > Municipal Facilities > Government Facilities > Airports > Manufacturing Plants > Petroleum & Chemical Facilities > Power Plants 8 Substations > Schools & Universities > Stadiums & Event Centers i^mwadteristarience.com 1888-333-3422 nrktgeamer rstal fence. cam I"' "' AMER1STAR II:�I� FENCE PRODUCTS PASSPORT ROLL GATES Was ?tuPwtCommercial I iNCmaaeaWPWtetBatrnSMex Ckuk, MaJwtia Gmesfs. krvinuLbtshaml 11111111111111111 11111111IIll1 PessPartB ( l'OmsnaMalPkbillate Style' *Wog Genes4 toinab 4 Clasdc(shaas) atuuuut uununnus1 r11111 i 111111 ��1ii I1I0111� . zg, if, sr..'r iH J t',,r, , +G.`o PatsPastnS 1 PieOmemmdIPakgeMn Spks I Lldeat SamMd4 iiradkl(stemn) 1111111 II ijJijI .4tfif..;V.li •,Sx:1Rit2 MI 1fd Pll ArcedrkrS desist awn has err peed d* sddmg gate kwmpOrgh Baktostindostgstaadarts PassfM loll gates sa destined tomg AS1Mff 4 off, Design feBy HMdedStae1Comhoc6na > Hy dgl& no x Ilya. > Magormlerrcalr ?sax Ilga. > BofbmRek T'XPxllga > MtMuatexllgagabpak Hardware The Passport rot pate design has been matched wth equally superior hardware. The v-track ropers are deslpned to support more Menthe re000vnanded bad, and provide an effortless balance that Odes smoothly across is gale opening. wvrwanteristarfence.com 1888-333.3422 mktg 4 atneristaI ienCe.Com "':"' AMERISTAR aIh� FENCE PRODUCTS EXHIBIT "A" EXHIBIT "A" GALV/W®µTRACK — FOR USE WITH µGROOVE WHEEL Ont/6'x4'Pirtle 1 1/Zx 11/2'x3/18' AB above V1h hot<OP 2142744g7Pd 8nkh. HURRICANE 8 POWAY FENCE Co. P.O. Box 1878 RAMONA CA82088•C800 (780) 7894142 Fat 780.788.1537 /7.26 ,.22Sad A4E..+JuE 7P444*..4 .10 .SZTE ,ziyf7JiOs'EaT6w/TS Rolling Gate RESOLUTION NO. 2014 — 99 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY AUTHORIZING THE APPROPRIATION AND REVENUE INCREASE OF $575,000, AND AUTHORIZING THE MAYOR TO EXECUTE A PURCHASE AND SALE AGREEMENT WITH STEPHEN RANDOLPH JOHNSTON, PAUL WILLIAM RALPH AND MICHELLE LEANN HOOPER RALPH FOR THE PURCHASE OF PROPERTY LOCATED AT 726 WEST 19TH STREET FOR THE TOTAL PURCHASE PRICE OF $575,000.00 FOR THE RELOCATION OF THE NATIONAL CITY PUBLIC WORKS FACILITIES FROM 2100 HOOVER AVENUE IN THE CITY OF NATIONAL CITY ALLOWING FOR THE DEVELOPMENT OF 201 AFFORDABLE RENTAL HOUSING UNITS AS PHASE I AND II OF THE WESTSIDE IN -FILL TRANSIT ORIENTED DEVELOPMENT PROJECT WHEREAS, the Successor Agency to the Community Development Commission as the National City Redevelopment Agency (Successor Agency) is subject to the enforceable obligation commonly referred to as the Westside Infill Transit Oriented Development (WI-TOD) Development and Disposition Agreement (DDA), entered into June 21, 2011 with Paradise Creek Housing Partners, LP (Developer); and WHEREAS, as part of the WI-TOD DDA, National City Public Works ("PW") operations at 2100 Hoover Avenue will need to be relocated to other sites in order for the Successor Agency to complete environmental remediation and develop 201 affordable housing units at the Hoover property, as required by the DDA; and WHEREAS, the City's relocation plans for PW have included accommodating for a substantial part of PW operations within existing City facilities; and WHEREAS the City still needs to secure a facility that can house the following PW functions: storage, office space, and offsite parking; and WHEREAS, the City has reviewed options for relocation, but alternatives that have been considered are not readily available or do not fully satisfy PW's operational requirements, and do not fall within the timeline for implementing the WI-TOD DDA development; and WHEREAS, the City has negotiated to purchase a .13 acre site that provides 5,021 sq. ft., of useable building area and is commonly known as 726 West 19th Street in the City of National City (the Property); and WHEREAS, the owners of the Property are willing to sell their Property at a negotiated price of $575,000.00; and WHEREAS, on December 18, 2013, the City entered into a Site Infrastructure Agreement with the Developer that would reimburse the City up to $4,000,000 for the fees, costs, and expenses incurred by the City with respect to preparation of the site, including without limitation, costs incurred with respect to relocation of persons and improvements located at the site; and WHEREAS, the City will be reimbursed $575,000 by the Site Infrastructure Agreement for the purchase cost of the Property; and WHEREAS, all actions required by all applicable law with respect to the proposed Purchase and Sale Agreement have been taken in an appropriate and timely manner; and Resolution No. 2014 — 99 Page Two WHEREAS, the City Council has duly considered all terms and conditions of the proposed Purchase and Sale Agreement and believes that the acquisition of the Property is in the best interests of the City of National City and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local law requirements. NOW, THEREFORE, BE IT RESOLVED that the City Council authorizes the Mayor to execute the Purchase and Sale Agreement between the City of National City and Stephen Randolph Johnston, Paul William Ralph and Michelle Leann Hooper Ralph for the purchase of the Property in the City of National City for a total purchase price of $575,000.00. Said Purchase and Sale Agreement is on file with the City Clerk. BE IT RESOLVED that the City Council of the City of National City hereby authorizes the appropriation and corresponding revenue increase of $575,000 for the purpose of environmental remediation work on the Westside In -fill Transit Oriented Development Project site. BE IT FURTHER RESOLVED that the City Council authorizes City Manager or her designee to execute any other documents necessary to fulfill the terms of the Purchase and Sale Agreement, including escrow documents. BE IT FURTHER RESOLVED that the City Council determines the purchase of the Property is exempt under CEQA, pursuant to section 15301 of the Guidelines, because the purchase and use of the Property would involve negligible or no expansion of the existing use of the structures and/or facilities, thus it is categorically exempt. PASSED and ADOPTED this 17th day of June, 201� ATTEST: Michael R. Dalla, CiClerk VED AS TO FORM: Cla City Attorn Silva on Morrison, Mayor Passed and adopted by the Council of the City of National City, California, on June 17, 2014 by the following vote, to -wit: Ayes: Councilmembers Cano, Morrison, Natividad, Rios, Sotelo-Solis. Nays: None. Absent: None. Abstain: None. AUTHENTICATED BY: RON MORRISON Mayor of the City of National City, California Cer/JAP of City City MJational City, California By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2014-99 of the City of National City, California, passed and adopted by the Council of said City on June 17, 2014. City Clerk of the City of National City, California By: Deputy CITY OF NATIONAL CITY, CALIFORNIA COUNCIL AGENDA STATEMENT MEETING DATE: June 17, 2014 AGENDA ITEM NO. 42 ITEM TITLE: Resolution of the City Council of the City of National City authorizing the appropriation and revenue increase of $575,000 and authorizing the Mayor to execute a Purchase and Sale Agreement with Stephen Randolph Johnston, Paul William Ralph and Michelle Leann Hooper Ralph for the purchase of property located at 726 W. 19th Street for the total purchase price of $575,000 for the relocation of the National City Public Works facilities from 2100 Hoover Avenue in the City of National City allowing for the development of 201 affordable rental housing units as Phase I and II of the Westside In -fill Transit Oriented Development Project. PREPARED BY: Carlos Aguirre, Comm. Dev. Manage DEPARTMENT: PHONE: 619.336.4391 EXPLANATION: Please see attached background report and explanation. APPROV Housing, Grants, & set Management FINANCIAL STATEMENT: APPROVED: 71 Finance ACCOUNT NO. APPROVED: Revenue Account #001-06029-3648 (WI-TOD Site Infrastructure) - $575,000 Expenditure Account #001-409-500-598-1595 (Public Works Facility Relocation Project) - $575,000 ENVIRONMENTAL REVIEW: Exempt from CEQA environmental review under CEQA Guidelines Sec. 15301 Existing Facilities ORDINANCE: INTRODUCTION: FINAL ADOPTION: MIS STAFF RECOMMENDATION: Adopt the Resolution BOARD / COMMISSION RECOMMENDATION: ATTACHMENTS: 1. Background Report and Explanation 2. Purchase and Sale Agreement Attachment No. 1 Background Report and Explanation The Westside Infill Transit Oriented Development (WI-TOD), also known as the Paradise Creek Affordable Housing Project, is a proposed 201-unit affordable housing development on the east side of Paradise Creek, and the expansion of Paradise Creek Educational Park on the west side of the creek. The proposed project is based on a concept that was developed through a neighborhood and stakeholder design participation process and incorporated into the Westside Specific Plan, which was adopted in 2010. The current proposed project design was developed with continuing public input and participation through stakeholder and community meetings. Development Agreement. After adoption of the Westside Specific Plan, a request for proposals was issued, and the applicant was selected to develop the site. The applicant entered into a Disposition and Development Agreement with the Community Development Commission to develop the project. The agreement is an enforceable obligation of the Successor Agency to the Community Development Commission (SA). The entire site is owned by the City; however, the housing portion of the site will be transferred to the Housing Authority. Pursuant to the Disposition and Development Agreement, the developer will be required to enter into a long-term ground lease for the housing site and will manage and operate the housing development, including resident services and programs. The Community Development Commission -Housing Authority will retain ownership of the housing site. Housing Development. The housing development side of the project would consist of two phases on the east side of Paradise Creek. The first phase would be built on approximately four acres on the southern portion of the site and would include 109 units within two buildings and a separate residential services building. The second phase would be built on approximately two acres on the northern portion of the site and would include 92 units within two buildings. The anticipated unit mix would include one - bedroom, two -bedroom, and three -bedroom units on three to four levels within the four residential buildings. The residential buildings would generally be oriented along 22nd Street and Hoover Avenue and set back from Paradise Creek with open space along the creek boundary. Park Development. The park development side of the project would add nearly four acres to Paradise Creek Educational Park on the west side of the creek. Paradise Creek Housing Partners is required to construct the park improvements pursuant to the Disposition and Development Agreement. The proposed improvements would include a naturalized planting buffer along Paradise Creek, a lawn area, a community garden, a playground, a plaza, picnic tables, a pedestrian/bicycle path along the length of the creek, and tree and shrub plantings along the western edge of the park. Park ownership would be maintained by the City. i Attachment No. 1 Relocation of Public Works Department and Purchase of 726 West 19th Street. As part of the WI-TOD DDA, National City Public Works ("PW") operations at 2100 Hoover Avenue will need to relocate to other sites in order for the Successor Agency to complete environmental remediation and develop 201 affordable housing units on Parcel 1 and Parcel 2. The City's relocation plans for PW have accommodated for a substantial part of PW operations within existing City facilities and another site. The City still needs to secure a facility that can house the PW street, storm drain, sewer and building maintenance, graffiti removal and traffic signing functions. The City reviewed options for relocation but alternatives that have been considered are not readily available or do not fully satisfy PW's operational requirements and do not fall within the timeline for implementing the WI- TOD development. The City negotiated the purchase of a 0.13 acre site which fits the needs of the above listed PW operations functions by providing 5,247 sq. ft. of useable building area including office space and off street parking. The property is commonly known as 726 West 19th Street, National City, California 91950. The Owners of 726 West 19th Street, National City, California 91950 are willing to sell their property and have accepted an offer by the City to purchase at a negotiated price of $575,000.00. 2 Attachment 2 PURCHASE AND SALE AGREEMENT (726 West 19`h Street, National City, CA 91950) THIS PURCHASE AND SALE AGREEMENT ("Agreement") is dated as of the 17th day of June, 2014 ("Effective Date") by and between Stephen Randolph Johnston, Paul William Ralph and Michelle Leann Hooper Ralph (collectively, the "Seller") and the City of National City ("Purchaser"). RECITALS A. The Seller owns the fee interest in that certain real property generally located at. 726 West 19th Street, National City, California 91950, Assessor's Parcel Number 559-095-09-00, legally described and depicted in Exhibit A attached hereto and made a part hereof ("Real Property"). B. Seller proposes to construct on the Property certain improvements ("Additional Improvements") as described on Exhibit C attached to and incorporated into this Agreement by reference. The Additional Improvements shall be constructed by the Seller in accordance with the Construction Contract that is being entered into between the Seller and Purchaser concurrently herewith ("Construction Contract"). C. Upon completion of the Additional Improvements, Purchaser desires to purchase the Real Property (including without limitation the Additional Improvements, and any all other improvements and fixtures thereon, which shall be referred to collectively herein as the "Property") on the terms, covenants, and conditions contained in this Agreement. D. Provided the various conditions to Closing (as defined below) set forth in this Agreement, including, without limitation, completion of construction of the Additional Improvements, are satisfied, the Seller agrees to sell the Property to the Purchaser and the Purchaser agrees to purchase the Property from the Seller as set forth in this Agreement. Provided, however, the Seller acknowledges and agrees that in order to bind Purchaser to the terms and conditions of this Agreement, this Agreement must be approved by the City of National City. AGREEMENT FOR GOOD AND VALUABLE CONSIDERATION, the receipt and adequacy of which are acknowledged, the Seller and the Purchaser hereby agree as follows: 1. Purchase and Sale. In consideration of the mutual covenants set forth in this Agreement, the Purchaser will acquire all of the Property, on the terms and conditions set forth herein, provided the various conditions to Closing set forth in this Agreement are satisfied. (a) Sale of the Property. The Seller agrees to sell the Property to the Purchaser, and the Purchaser agrees to purchase the Property from Seller, on the terms and conditions set forth herein. At Closing, the Seller shall convey the fee interest in the Real Property to the Purchaser 1 Attachment 2 by recordation of the Grant Deed (as defined below). The Escrow Agent shall issue the Title Policy (as defined below) to the Purchaser at Closing. (b) Possession of the Property. The Seller shall deliver possession of the Property to Purchaser at Closing. Possession of the Property shall be delivered to Purchaser subject only to the Permitted Exceptions, all as defined hereinbelow. 2. Definitions. As used in this Agreement, the following terms shall have the following meanings: "Additional Improvements" has the meaning set forth in Recital B, above. "Agreement" means this Purchase and Sale Agreement between the Seller and the Purchaser. "Applicable Environmental Law" means all laws applicable to the presence of any Hazardous Materials (as defined below) on or within the Property, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. §9601, et seq.); the Resource Conservation and Recovery Act (42 U.S.C. §6901, et seq.); the Clean Water Act (33 U.S.C. §2601, et seq.); the Safe Drinking Water Act (14 U.S.C. §300f, et seq.); the Hazardous Materials Transportation Act (49 U.S.C. §5101, et seq.); the Toxic Substances Control Act (15 U.S.C. §2601, et seq.); the Federal Water Pollution Control Act (33 U.S.C. §1300, et seq.); the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. §136, et seq.); the Atomic Energy Act (42 U.S.C. §2011, et seq.); the Nuclear Waste Policy Act (42 U.S.C. §10101, et seq.); the Clean Air Act (42 U.S.C. §7401, et seq.); the California Hazardous Waste Control Act (California Health and Safety Code §25100, et seq.); the Carpenter -Presley -Tanner Hazardous Substance Account Act (California Health and Safety Code §25300, et seq.); the Safe Drinking Water and Toxic Enforcement Act ("Proposition 65") (California Health and Safety Code §25249.5, et seq.); and the Porter -Cologne Water Quality Control Act (California Water Code §13000, et seq.); and any similar federal, state or local laws, all regulations and publications implementing or promulgated pursuant to the foregoing, as any of the foregoing may be amended or supplemented from time to time. "Business Day" means any day other than a Saturday, Sunday or any other day on which Purchaser or Escrow Agent is not open for business. In the event any date, deadline or due date set forth in this Agreement falls on a day that is not a Business Day, then such deadline or due date shall automatically be extended to the next Business Day. "Close" or "Closing" means the close of Escrow as provided herein, which shall not be later than the last day of the Due Diligence Period. "Closing Date" means the date on which the Closing occurs. "Conditions Precedent for the Benefit of the Seller" shall have the meaning set forth in Section 6 of this Agreement. 2 Attachment 2 "Conditions Precedent for the Benefit of the Purchaser" shall have the meaning set forth in Section 7 of this Agreement. "Deposit" shall have the meaning set forth in Section 3(b)(1) of this Agreement. "Due Diligence Period" means the period of time commencing on the Effective Date and ending on July 15, 2014; provided, however, that the Purchaser shall have three (3) one -month options to extend the Due Diligence Period. Each of those extension options may be exercised by the Purchaser providing written notice of the same to the Seller and Escrow Agent. "Effective Date" is defined above. "Escrow" means the escrow depository and disbursement services to be performed by Escrow Agent pursuant to the provisions of this Agreement. "Escrow Agent" means John Lynn at Ticor Title 2878 Camino Del Rio South, Suite 500, San Diego, California 92108. "Grant Deed" means a duly executed and acknowledged grant deed conveying fee simple title to the Real Property from the Seller to the Purchaser, in substantially the form attached hereto as Exhibit B and made a part hereof. "Hazardous Materials" means: (1) Those substances included within the definitions of "hazardous substance," "hazardous waste," "hazardous material," "toxic substance,f' "solid waste," "pollutant" or "contaminant" in the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. §9601 et seq.); the Resource Conservation and Recovery Act (42 U.S.C. §6901 et seq.); the Clean Water Act (33 U.S.C. §2601 et seq.); the Toxic Substances Control Act (15 U.S.C. §9601 et seq.); the Hazardous Materials Transportation Act (49 U.S.C. § 1801 et seq.); or under any other Environmental Laws. (2) Those substances included within the definitions of "Extremely Hazardous Waste," "Hazardous Waste," or "Restricted Hazardous Waste," under §§25115, 25117 or 25122.7 bf the California Health and Safety Code, or is listed or identified pursuant to §§25140 or 44321 of the California Health and Safety Code. (3) Those substances included within the definitions of "Hazardous Material," "Hazardous Substance," "Hazardous Waste," "Toxic Air Contaminant" or "Medical Waste" under §§25281, 25316, 25501, 25501.1, 25023.2 or 39655 of the California Health and Safety Code. (4) Those substances included within the definitions of "Oil" or a "Hazardous Substance" listed or identified pursuant to §311 of the Federal Water Pollution Control Act, 33 U.S.C. §1321, as well as any other hydrocarbonic substance or by-product. 3 Attachment 2 (5) Those substances included within the definitions of "Hazardous Waste," Extremely Hazardous Waste" or an "Acutely Hazardous Waste" pursuant to Chapter 11 of Title 22 of the California Code of Regulations. (6) Those substances listed by the State of California as a chemical known by the State to cause cancer or reproductive toxicity pursuant to §25249.9(a) of the California Health and Safety Code. (7) Any material which due to its characteristics or interaction with one or more other substances, chemical compounds, or mixtures, damages or threatens to damage, health, safety, or the environment, or is required by any law or public agency to be remediated, including remediation which such law or public agency requires in order for the property to be put to any lawful purpose. (8) Any material whose presence would require remediation pursuant to the guidelines set forth in the State of California Leaking Underground Fuel Tank Field Manual, whether or not the presence of such material resulted from a leaking underground fuel tank. (9) Pesticides regulated under the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. §136 et seq. (10) Asbestos, PCBs, and other substances regulated under the Toxic Substances Control Act, 15 U.S.C. §2601 et seq. (11) Any radioactive material including, without limitation, any "source material," "special nuclear material," "by-product material," "low-level wastes," "high-level radioactive waste," "spent nuclear fuel" or "transuranic waste" and any other radioactive materials or radioactive wastes, however produced, regulated under the Atomic Energy Act, 42 U.S.C. §§2011 et seq., the Nuclear Waste Policy Act, 42 U.S.C. §§10101 et seq., or pursuant to the California Radiation Control Law, California Health and Safety Code § §25800 et seq. (12) Any material regulated under the Occupational Safety and Health Act, 29 U.S.C. §§651 et seq., or he California Occupational Safety and Health Act, California Labor Code §§6300 et seq. (13) Any material regulated under the Clean Air Act, 42 U.S.C. §§7401 et seq. or pursuant to Division 26 of the California Health and Safety Code. (14) Those substances listed in the United States Department of Transportation Table (49 CFR Part 172.101), or by the Environmental Protection Agency, or any successor agency, as hazardous substances (40 CFR Part 302). (15) Other substances, materials, and wastes that are or become regulated or classified as hazardous or toxic under federal, state or local laws or regulations. 4 Attachment 2 (16) Any material, waste or substance that is a petroleum or refined petroleum product, asbestos, polychlorinated biphenyl, designated as a hazardous substance pursuant to 33 U.S.C. §1321 or listed pursuant to 33 U.S.C. §1317, a flammable explosive or a radioactive material. "Immediately Available Funds" means a bank wire transfer or a certified bank or cashier's check. "Improvements" means collectively: (i) any and all buildings, structures and improvements, of any kind whatsoever, located at or affixed to the Real Property; (ii) all rights, privileges and easements appurtenant to the Real Property, if any, including, without limitation, all minerals, oil, gas and other hydrocarbon substances on and under the Real Property, if any; (iii) all development rights, air rights, and water rights if any, relating to the Real Property; and (iv) the Additional Improvements. "Permitted Exceptions" means collectively, the (i) the printed exceptions and exclusions in the Title Policy; (ii) the exceptions to the Title Report (as defined in Section 4(c) below) and approved by Purchaser in writing, or deemed approved by Purchaser, as provided in Section 4(c) below; (iii) real property taxes and assessments which are a lien but not yet payable; (iv) all applicable building, zoning and use restrictions and/or regulations of any municipality, township, county or state; and (v) defects that are shown on the American Land Title Association survey of the Real Property and Improvements which are approved by Purchaser in writing, or deemed approved by Purchaser, as provided in Section 4(c) below. "Property" has the meaning set forth in Recital C, above. "Purchase Price" shall have the meaning set forth in Section 3(a) of this Agreement. "Purchaser" means the City of National City; provided, however, if the City of National City assigns its interest in this Agreement pursuant to Section 11 of this Agreement, then the term "Purchaser" shall mean such assignee. "Real Property" has the meaning set forth in Recital A, above. "Seller" means collectively, Seller's Name(s). "Title Company" means Ticor Title 2878 Camino Del Rio South, Suite 500, San Diego, California 92108. "Title Policy" means a CLTA Owner's Policy of Title Insurance in the amount of the Purchase Price, insuring that title to the fee interest in the Property is vested in the Purchaser subject only to the Permitted Exceptions, which Title Policy shall be obtained through Stewart Title Company. Seller shall pay the cost of the CLTA Owner's Policy of Title Insurance. Purchaser shall pay the cost of any endorsements it desires. Purchaser may obtain an ALTA Owner's Policy of Title Insurance in which event Purchaser shall pay the cost difference between 5 Attachment 2 the cost of the ALTA Owner's Policy of Title Insurance and the cost of a CLTA Owner's Policy of Title Insurance. 3. Purchase Price. (a) Total Purchase Price. The purchase price to be paid by the Purchaser for all of the Property shall be Five Hundred Seventy -Five Thousand and No/100 Dollars ($575,000.00) ("Purchase Price"). (b) Deposit; Liquidated Damages. (1) Deposit. Purchaser shall make a deposit ("Deposit") into Escrow in the amount of Two Thousand Five Hundred and No/100 Dollars ($2,500.00) within ten (10) business days of the Effective Date. If Purchaser elects to terminate this Agreement prior to expiration of the Due Diligence Period then the Deposit shall be immediately returned by Escrow Agent to the Purchaser. if Purchaser elects to terminate or defaults under this Agreement after the expiration of the Due Diligence Period but prior to Closing, then the Deposit shall be distributed to Seller and Purchaser as provided in the liquidated damages provision below. At Closing, the Deposit shall be credited against the Purchase Price as provided in this Agreement. (2) LIQUIDATED DAMAGES. THE DEPOSIT SHALL BE REFUNDABLE TO THE PURCHASER AS EXPRESSLY PROVIDED FOR IN THIS AGREEMENT. IF ESCROW FAILS TO CLOSE AS A RESULT OF PURCHASER'S DEFAULT UNDER THIS AGREEMENT, THE SOLE REMEDY OF SELLER SHALL BE TO TERMINATE THIS AGREEMENT BY GIVING WRITTEN NOTICE TO PURCHASER AND ESCROW AGENT, WHEREUPON THE SELLER SHALL RETAIN AS LIQUIDATED DAMAGES THE DEPOSIT (AND SELLER WAIVES ANY RIGHT TO SPECIFICALLY ENFORCE THIS AGREEMENT SET FORTH IN CALIFORNIA CIVIL CODE SECTION 1680 OR 3389). THEREAFTER, NO PARTY HERETO SHALL HAVE ANY FURTHER LIABILITY OR OBLIGATION TO ANY OTHER PARTY HERETO EXCEPT FOR: (i) THE SELLER'S RIGHT TO RECEIVE AND RETAIN SUCH LIQUIDATED DAMAGES; AND (ii) THE OBLIGATION OF THE PARTIES TO PAY AMOUNTS INTO ESCROW TO PAY A PORTION OF THE FEES AND COSTS OF ESCROW AS SET FORTH IN THIS AGREEMENT. THE PARTIES TO THIS AGREEMENT ACKNOWLEDGE AND AGREE THAT THE SELLER.'S ACTUAL DAMAGES IN THE EVENT OF PURCHASER'S DEFAULT ARE UNCERTAIN IN AMOUNT AND DIFFICULT TO ASCERTAIN, AND THAT SUCH AMOUNT OF LIQUIDATED DAMAGES IS REASONABLE UNDER THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1671 ET SEQ., CONSIDERING ALL OF THE CIRCUMSTANCES EXISTING ON THE DATE HEREOF INCLUDING, WITHOUT LIMITATION, THE RELATIONSHIP OF SUCH AMOUNT TO THE RANGE OF POTENTIAL HARM TO THE SELLER THAT CAN REASONABLY BE ANTICIPATED AND THE ANTICIPATION THAT PROOF OF ACTUAL DAMAGES RESULTING FROM SUCH DEFAULT WOULD BE COSTLY AND INCONVENIENT. IN PLACING ITS INITIALS IN TIIE SPACE BELOW, EACH PARTY TO THIS AGREEMENT SPECIFICALLY CONFIRMS THE ACCURACY OF THE FOREGOING AND THE FACT 6 Attachment 2 THAT SUCH PARTY HAS BEEN REPRESENTED BY COUNSEL WHO EXPLAINED THE CONSEQUENCES OF THIS LIQUIDATED DAMAGES PROVISION. THE PROVISIONS OF THIS SECTION 3(B)(2) SHALL SURVIVE THE TERMINATION OF THIS AGREEMENT. Seller's Initials Purchaser's Initials (c) Delivery of Remainder of Purchase Price into Escrow. Not less than one (1) Business Day prior to the Closing Date, the Purchaser shall cause Immediately Available Funds to be delivered to the Escrow Agent in an amount equal to the Purchase Price, minus the Deposit and any interest earned on the Deposit, and plus or minus any adjustments for prorations and expenses required under this Agreement. (d) Disbursement to the Seller. Immediately after the Closing, the Escrow Agent shall disburse to the Seller the funds that the Seller is entitled to receive under this Agreement. 4. Due Diligence Period. During the Due Diligence Period, the Purchaser may determine in the Purchaser's sole and absolute discretion, whether to proceed with the purchase of the Property. During the Due Diligence Period, the Purchaser may terminate this Agreement for any reason or for no reason at all. If the Purchaser terminates this Agreement during the Due Diligence Period, then: (i) all rights and liabilities of the Purchaser and the Seller with respect to this Agreement shall immediately terminate, except for rights and liabilities that specifically survive such termination; (ii) Escrow Agent shall return to the Purchaser all funds or other things deposited in Escrow by the Purchaser; and (iii) Escrow Agent shall return to the Seller all funds or other things deposited in Escrow by the Seller. Provided, however, all fees and costs charged by the Escrow Agent shall be paid one-half (1/2) by the Seller and one-half (1/2) by the Purchaser. (a) Access to the Property and Cooperation. During the Due Diligence Period, and during normal business hours, upon not less than twenty-four (24) hours advance notice to the Seller, Purchaser and its representatives, consultants and attorneys shall have access to entry upon the Property. Purchaser shall indemnify, defend, protect and hold the Seller and Seller's successors, assigns, officers, directors, shareholders, participants, partne s, affiliates, employees, representatives, invitees and agents or any of them, and the Property harmless from any losses, costs, damages, claims and/or liabilities, including but not limited to, mechanics' and materialmen's liens and attorney fees and costs proximately caused by such entry upon the Property. In the event Escrow does not close due to an election by the Purchaser not to purchase the Property or a default by the Purchaser, the Purchaser shall, at its sole cost and expense, promptly return the Property to the Seller in the same physical condition it now enjoys, and shall repair any physical damage caused by the Purchaser to the Property as part of or in connection with any such entry upon the Property. The Purchaser is self -insured with excess coverage provided pursuant to an insurance pool. Purchaser's agents, consultants and contractors will secure and maintain, at the Purchaser's or such other person's sole cost, the following policies of insurance which include coverage of all of Purchaser's and its representatives', consultants' and 7 Attachment 2 attorneys' activities on the Property: (I) comprehensive public liability and property damage insurance, including direct contractual and contingent liability with limits of $2,000,000 for personal liability to or death of any one person, $2,000,000 for personal injury to or death of any one person on an occurrence basis, $1,000,000 for property damage in any one accident and $2,000,000 policy limit for aggregate operation on an occurrence basis; (2) comprehensive automobile liability insurance with limits of $1,000,000 for personal injury to or death of any one person, $2,000,000 for personal injury to or death of more than one person in any one accident and $1,000,000 for property damage in any one accident; (3) workers compensation and employer's liability insurance in accordance with the provisions of California law. Policies of insurance described in clause (1), above, shall name the Seller as an additional insured. Certificates of such insurance shall be delivered by the Purchaser to the Seller before entry onto the Property by the Purchaser or its agents, contractors or employees. All such Certificates shall require at least thirty (30) days written notice to Seller prior to termination of such insurance. The Purchaser shall not permit any mechanic's, materialman's, contractor's, subcontractor's or other lien arising from any work done by thc Purchaser or its agents pursuant to this Agreement to stand against the Property. If any such lien shall be filed against the Property, the Purchaser shall cause the same to be discharged or bonded within ten (10) days after actual notice of such filing, by payment, deposit, bond or otherwise. The Purchaser's obligations under this Section 4(a) shall survive the termination or expiration of this Agreement and/or Closing. The Purchaser shall have the right during the Due Diligence Period, after providing not less than twenty-four (24) hours advance notice to the Seller, to perform (or cause its consultants and contractors to perform) lead based paint and asbestos testing provided the same are performed in accordance with ASTM published testing standards. Except as set forth in the immediately preceding sentence, if Purchaser desires to do any invasive testing at the Property, the Purchaser may do so only after obtaining Seller's prior written consent to the same, which consent may be withheld or granted on conditions in Seller's sole and absolute discretion. The Purchaser shall promptly restore the Property to thc condition the Property was in immediately prior to any such tests, at the Purchaser's sole cost and expense. The Purchaser shall provide the Seller with a complete set of plans, drawings and specifications ("Invasive Testing Plans") that define to the sole satisfaction of the Seller the invasive testing to be performed on the Property and the names of all environmental and other consultants, contractors and subcontractors who will be performing such invasive testing (collectively "Purchaser's Consultants"). The Purchaser shall deliver the names of the Purchaser's Consultants and the Invasive Testing Plans to the Seller concurrently with its request to the Seller that the Purchaser desires to perform invasive testing (unless the names of Purchaser's Consultants have previously been provided to the Seller). (b) Title. Purchaser's obligation to purchase the Property is contingent upon Purchaser's approval of all matters affecting title to or use of the Real Property (collectively, "Title Matters"). The intent of this Section 4(b) is to allow the parties to have certainty regarding the condition of title and the Title Matters which are acceptable to the Purchaser. The procedure set forth in this Section 4(b) shall not affect or otherwise limit the Purchaser's right to terminate this Agreement for any reason or no reason at all as set forth in Section 4, above. (1) Title Report. Title Company previously delivered a current preliminary title report for the Real Property to the Purchaser ("Title Report"). Purchaser shall have until June 25, 2014 (eight (8) days after the Effective Date), to approve or object to any items 8 Attachment 2 disclosed by the Title Report. If Purchaser does not give written notice to Seller of Purchaser's approval or disapproval of any items disclosed by the Title Report within said time period, then Purchaser shall be deemed to have approved the items disclosed by the Title Report. If Purchaser gives written notice to Seller of Purchaser's disapproval of any items disclosed by the Title Report within said time period and Seller does not give written notice to Purchaser within two (2) calendar days thereafter of: (i) Seller's elimination of or agreement to eliminate those disapproved matters prior to the close of Escrow; or (ii) Seller's agreement to provide at Seller's sole expense such title insurance endorsements relating thereto as are acceptable to Purchaser in Purchaser's sole discretion prior to the close of Escrow (each, a "Cure Notice"), then this Agreement shall terminate immediately, unless Purchaser affirmatively agrees in writing that this Agreement will remain in full force and effect. Notwithstanding the foregoing, Seller shall cause all Title Matters which are mechanics' liens and/or deeds of trust to be eliminated as exceptions to title on the Title Policy at Seller's sole expense prior to the close of Escrow. (2) Survey. Seller shall use commercially reasonable efforts to cause an American Land Title Association survey of the Real Property and Improvements to be completed on or before June 25, 2014 (eight (8) days after the Effective Date). Purchaser shall have until July 3, 2014 (sixteen (16) days after the Effective Date), to approve or object to any items disclosed by the American Land Title Association survey. If Purchaser does not give written notice to Seller of Purchaser's approval or disapproval of any items disclosed by the American Land Title Association survey within said time period, then Purchaser shall be deemed to have approved the any items disclosed by the American Land Title Association survey. If Purchaser gives written notice to Seller of Purchaser's disapproval of any items disclosed by the American Land Title Association survey within said time period and Seller does not give written notice to Purchaser within two (2) calendar days thereafter of: (i) Seller's elimination of or agreement to eliminate those disapproved matters prior to the close of Escrow; or (ii) Seller's agreement to provide at Seller's sole expense such title insurance endorsements relating thereto as are acceptable to Purchaser in Purchaser's sole discretion prior to the close of Escrow (each, a "Cure Notice"), then this Agreement shall terminate immediately, unless Purchaser affirmatively agrees in writing that this Agreement will remain in full force and effect. 5. Completion of Additional Improvements. (a) No later than five (5) days after the Effective Date, Seller will begin construction of the Additional Improvements in accordance with the Construction Contract. All costs and expenses of the construction of the Additional Improvements will be paid by Seller. Seller shall apply for, pay for and obtain, any and all permits or licenses required by applicable governmental authorities (including without limitation, City of National City Development Services) necessary or desirable for Seller to construct and install the Additional improvements. The Purchaser shall not be responsible in any way for, the processing Seller's building permits or other permit applications with the City of National City Development Services. The execution of this Agreement by the Purchaser (i.e., the City of National City) does not constitute the granting of or a commitment to provide any required permits, entitlements or approvals. Seller shall comply with all applicable requirements of the City of National City Development Services and all applicable provisions of the California Public Contract Code. Seller, the general contractor, and any and all subcontractors, shall pay prevailing wages for all work done with 9 Attachment 2 respect to the Additional Improvements as required by California law, including without limitation, the following: (1) Seller, the general contractor, and any and all subcontractors shall comply with prevailing wage requirements and be subject to restrictions, obligations, requirements, and penalties, in accordance with Section 1770 et seq. of the California Labor Code which requires prevailing wages be paid to appropriate work classifications in all bid specifications and subcontracts. (2) Seller, the general contractor, and any and all subcontractors shall furnish all subcontractors/employees a copy of the California Department of Industrial Relations prevailing wagc rates which the general contractor will post at the job site. Copies of the prevailing wage rates are available at the Purchaser's office and shall be made available to any interested party on request. (3) Seller, the general contractor, and any and all subcontractors shall comply with the payroll record keeping and availability requirement of Section 1776 of the California Labor Code, and shall deliver to the Purchaser not less than monthly, copies of the certified payroll records and all other documents required to be maintained pursuant to Section 1776 of the California Labor Code or any regulations issued by the California Department of Labor and/or the California Labor Commissioner with respect to the same. (4) Seller, the general contractor, and any and all subcontractors shall make travel and subsistence payments to workers needed for performance of work in accordance with the California Labor Code. (5) Prior to commencement of construction, the Seller, the general contractor, and any and all subcontractors shall contact the Division of Apprenticeship Standards of the California Department of Industrial Relations and comply with Section 1777.5, 1777.6, and 1777.7 of the California Labor Code and all applicable regulations, (b) At reasonable times and on reasonable notice during construction of the Additional Improvements, the Purchaser and its agents and representatives shall have access, without liability, to the Property and to all construction, job records, and information of Seller relating to the construction of the Additional Improvements (whether on Seller's premises or the premises of Seller's architects, engineers, contractors, and consultants) for the purpose of determining whether the work being performed is in accordance with the Construction Contract and this Agreement. All construction shall be performed in accordance with the Construction Contract. Any deficiencies in construction shall be corrected by the Seller, upon written notice from the Purchaser. Seller will at all times keep at the Property a complete updated set of the plans and specifications for the Additional Improvements for examination by Purchaser and its agents and representatives. (c) If Purchaser determines at any time prior to the Completion of the Additional Improvements, as defined in Section 5(d), below, that construction of the Additional Improvements is not proceeding in accordance with the Construction Contract or with this Agreement, and Purchaser does not elect to waive the deviation, deficiency, or omission, Purchaser will give notice to Seller specifying the particular deviation, deficiency, or omission, and Seller will take any corrective work that is necessary to correct the deviation, deficiency, or omission. 10 Attachment 2 (d) On or before August 31, 2014 ("Completion Date"), Seller agrees to cause the completion of the Additional Improvements substantially in accordance with the Construction Contract in a good and workmanlike manner Failure to cause Completion of the Additional Improvements on or before the Completion Date shall be a material default hereunder. The completion of the Additional Improvements ("Completion of the Additional Improvements") will be deemed to have happened on the occurrence of all of the following: (i) the Additional Improvements have been substantially completed in accordance with the Construction Contract; (ii) the Design Architect has certified and provided to the Purchaser on AIA Form G-704 or similar form, a "Certificate of Substantial Completion," that the Additional Improvements have been completed substantially in accordance with the Construction Contract, and as such, are ready for occupancy; (iii) City of National City Development Services has issued a permanent certificate of occupancy and signed off on all permits for the building or structures on the Property; (iv) the Inspecting Engineer has certified and provided to Purchaser on ATA Form G-704, or similar form, a "Certificate of Substantial Completion," that the Additional Improvements have been completed substantially in accordance with the and are ready for occupancy; (v) Seller has certified to Purchaser that all of the costs for the construction and completion of the Additional Improvements have been paid in full, including, without limitation, payment for services rendered and material delivered by mechanics, materialmen, suppliers, architects, engineers, subcontractors, and the like, or punch list holdbacks; (vi) Purchaser has received reasonably satisfactory evidence that (A) all utilities reflected in the Construction Contract and required for the use and occupancy of the Additional Improvements enter the Property from adjacent public rights -of -way or through valid and appurtenant easements that will be transferred to Purchaser and have been installed, (B) any hookup, tap -on, or connection fees and charges for those utilities have been paid, (C) the installation of the utilities has been approved by the various utility companies, and (D) utility service to the Property has commenced; (vii) Purchaser has received copies of a survey indicating that the Improvements havel been erected completely within the boundaries of the Property and are not in violation of any setback restrictions affecting the Property and that no Improvements that are a part of the Property encroach onto adjacent land; and (ix) Seller has notified Purchaser that the Additional Improvements have been completed, and Seller has delivered to Purchaser all of the items required by subdivisions (i) through (viii), inclusive, of this Section 5. 6. Conditions Precedent for the Benefit of the Purchaser. The Purchaser's obligation to Close shall be conditioned upon the satisfaction or emailed or written waiver by the Purchaser of all of the conditions precedent ("Conditions Precedent for the Benefit of the Purchaser") set forth in this Section 6. Any of the Conditions Precedent for the Benefit of the Purchaser may be waived by the Purchaser unilaterally; and if so waived, such conditions shall be of no further effect hereunder. Any such waiver shall be effective only if the same is expressly waived (i) by 11 Attachment 2 email from the Purchaser to the Seller and Escrow Agcnt; or (ii) in a writing signed by the Purchaser and delivered to the Seller and Escrow Agent. If the Conditions Precedent for the Benefit of the Purchaser are not satisfied by the deadlines set forth in this Section 6 or expressly waived, the Purchaser (provided the Purchaser is not in default hereunder) may provide emailed or written notice of the Purchaser's conditional termination of this Agreement to the Seller and Escrow Agent. After receipt of such notice of conditional termination, the Seller shall have two (2) Business Days to cure any non -satisfaction of a condition or other default specified in the notice of conditional termination. If such matter remains unsatisfied or the default remains uncured after the expiration of such two (2) Business Day period, then this Agreement shall terminate at the close of business on such second (2nd) Business Day. In the event of termination of this Agreement (and by operation of law the Escrow) pursuant to this Section 6, then: (x) except to subparagraph (f) below, the same shall be a default by the Seller (y) Escrow Agent shall return to the Purchaser all funds or other things deposited in Escrow by the Purchaser, including without limitation, the Deposit; and (z) Escrow Agent shall return to the Seller all funds or other things deposited in Escrow by the Seller. Purchaser is not waiving any default by the Seller and nothing contained in this Section 6, including, without limitation, the immediately foregoing sentence shall be a waiver of any right of Purchaser to recover damages from the Seller for failure of any Conditions Precedent for the Benefit of the Purchaser. Provided, however, all fees and costs charged by the Escrow Agent shall all be paid by the Seller. (a) The deposit into Escrow by the Seller of the Grant Deed, duly executed and acknowledged, conveying fee simple title to the Property to the Purchaser at least one (1) Business Day prior to Closing. (b) The deposit by the Seller into Escrow of a duly executed affidavit that it is not a foreign person and is a "United States Person" as such term is defined in Section 7761(a)(30) of the Internal Revenue Code of 1986, as amended, at least one (1) Business Days prior to Closing. The affidavit shall be in the form prescribed by federal regulations, if any. (c) The deposit by the Seller into Escrow of a duly executed California Form 593(c) or other evidence that withholding of any portion of the Purchase Price is not required by the Revenue and Taxation Code of California, at least one (1) Business Day prior to Closing. (d) The deposit by the Seller into Escrow of all additional documents and instruments as are reasonably required b' the Purchaser and/or Escrow Agent to complete the Closing, at least one (1) Business Day prior to Closing. (c) The Escrow Agent is prepared and obligated to issue the Title Policy in Purchaser's favor upon the recordation of the Grant Deed and there are no exceptions to the Title Policy, except for Permitted Exceptions. (f) Seller not being in default of any of its representations or warranties under this Agreement, or any other material terms or conditions related to Seller. (g) As of the Closing Date, there exists no lease, tenancy or occupancy agreement affecting the Property. 12 Attachment 2 (h) As of the Closing Date there is not pending, or threatened to be pending, any action or proceeding by any person or before any government authority, the outcome of which could prohibit the use of the Property as intended by the Purchaser. City. (i) This Agreement has been formally approved by resolution of the City of National (j) Completion of the Additional Improvements as set forth in Section 5, above; (k) The Property is not destroyed or damaged by fire or other casualty and, if any casualty has occurred, the Property is restored to a condition equivalent with the completion of the Improvements; (1) Seller has not made an assignment for the benefit of creditors, filed a petition in bankruptcy, been adjudicated insolvent or bankrupt, petitioned a court for the appointment of any receiver of or trustee for it or any substantial part of its property, or commenced any proceeding relating to Seller undcr any reorganization, arrangement, readjustment of debt, dissolution, or liquidation law or statute of any jurisdiction, whether now or later in effect. There has not been commenced or pending against Seller any proceeding of the nature described in the first sentence of this subsection. No order for relief has been entered with respect of Seller, or any affiliated entity, under the Federal Bankruptcy Code; (m) There exists no Hazardous Materials on or otherwise affecting the Property; (n) There exist no known violations of any Applicable Environmental Law; and (o) Seller has complied and at Closing will be in compliance with each covenant in this Agreement, and the warranties in this Agreement will be true as of the Closing Date. 7. Seller's Representations and Warranties. As a material 'inducement to Purchaser, Seller warrants to Purchaser that, as of the date of this Agreement and as of the Closing Date: (a) there are no actions, suits, or proceedings pending, or, to the knowledge of Seller, threatened, against Seller or the Property, or involving the validity or enforceability of this Agreement, including, but not limited to, petitions under the Bankruptcy Act of 1978 or other petitions for reorganization or for debtor relief or for the appointment of a receiver; (b) the execution and delivery of this Agreement by Seller and the performance and observance of the terms have all been authorized by all necessary actions of Seller. This Agreement has been duly executed and delivered by Seller. This Agreement is in full force and is enforceable against Seller in accordance with its terms; (c) Seller owns good, marketable, and insurable fee simple title free of all Title Defects for the real property. Seller owns good title free of all Title Defects for the balance of the Property; (d) the Property have not suffered any damage by fire, windstorm, or other hazard that is not fully covered by insurance (or if covered by insurance, that would make it 13 Attachment 2 economically impractical for the Property to be restored or repaired) and that have not been fully restored, repaired, and rebuilt and no condemnation or other proceedings prohibiting the full use of the Property as originally contemplated by the parties have been instituted or threatened; (c) the general plans and notes and the Improvements, when completed, will comply with all applicable requirements of Governmental Authorities having jurisdiction; (f) the Improvements, when completed, in accordance with the general plans and notes, will be structurally sound; (g) in conjunction with all manufacturer's warrant(ies)/guarantee(s) for all products provided for the Improvements, all work for the Improvements shall be guaranteed by Seller for a period of one (1) year from the date of completion against defective workmanship and materials furnished by Seller. Seller shall promptly replace or repair, in a manner satisfactory to Purchaser, any such defective work, after notice to do so from Purchaser, and upon the Seller's failure to make such replacement or repairs promptly, Purchaser may perform this work and Seller shall be liable for the cost thereof; (h) no Hazardous Materials are present on, within or under the Property, or in the soil, groundwater or soil vapor on or under the Property. Seller has received no notice of any proceeding or inquiry pending before or by any governmental authority with respect to the presence of Hazardous Materials or the migration of Hazardous Materials to or from any other Property, nor is the Seller aware of any threat of such notice or of any environmental permits, disclosures, applications, entitlements or inquiries relating to the Property, including notices of violation, notices to comply, citations, inquiries, clean-up or abatement orders, cease and desist orders, reports filed pursuant to self -reporting requirements and reports filed or applications made pursuant to any governmental requirement relating to Hazardous Materials or underground tanks. (i) no person has any lease or other right to occupy the Property or any parts thereof. 8. Environmental Indemnity. Seller agrees to indemnify, defend and hold the Purchaser and all of its members, agents, officers, representatives, directors and employees (the "Indemnified Parties") harmless from and against any claim, action, suit, proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense (including, without limitation, attorneys' fees), resulting from, arising out of, or based upon any of the following which the occurs prior to Closing (regardless of whether the Purchaser became aware of the same before or after the Closing): (i) the existence, presence, release, use, generation, discharge, storage or disposal of any Hazardous Materials on, under, in or about, the Property, or (ii) the violation, or alleged violation, of any statute, ordinance, order, rule, regulation, permit, judgment or license relating to the use, generation, release, discharge, storage, disposal or transportation of Hazardous Materials on, under, in or about, to or from, the Property. The Seller's indemnification obligation set forth in this Section 8 shall not apply with respect to Hazardous Materials came to be on, under, in or about the Property after the Closing. This indemnity shall include, without limitation, any damage, liability, fine, penalty, parallel indemnity after closing cost or expense arising from or out of any claim, action, suit or proceeding for personal injury (including sickness, disease or death), tangible or intangible property damage, compensation for lost wages, business income, profits or other economic loss, damage to the natural resource or the environment, nuisance, contamination, leak, spill, release or other adverse effect on the environment. This indemnity provided in this Section 8 does not include any condition arising solely as a result of the affirmative acts or gross negligence of the Indemnified Parties. Notwithstanding anything contained in this Agreement to the contrary, the Seller's duty to indemnify the Indemnified Parties as set forth in this Section 8 shall survive and remain an outstanding obligation of the Seller after Closing. 14 Attachment 2 9. Seller's Covenants. Seller covenants to Purchaser that, through and including the Closing Date: (a) neither the Property (nor any part of it or any interest in this Agreement), nor any revenues, rents, issues, or profits from the Property, nor any interest in Seller, will be sold, transferred, assigned, mortgaged, pledged, or in any other way encumbered or conveyed without Purchaser's prior written consent. (b) Seller shall deliver to Purchaser monthly reports on the status of the construction of the Additional Improvements. The reports will include Seller's good -faith estimate of the date construction will be completed. (c) no changes will be made in the Construction Contract without Purchaser's prior written approval. Any proposed changes to the Construction Contract will be delivered to Purchaser with sufficient time for appropriate review. (d) Seller will not take or permit any action that would be inconsistent with or make impossible the consummation of the purchase and sale in accordance with this Agreement. (e) without the prior written approval of Purchaser, Seller will not execute or make any agreement or other arrangement or modify any existing agreement or other arrangement that cannot be terminated on thirty (30) days' notice and that may bind or obligate the Property or Purchaser after Closing. (f) so long as this Agreement remains in force, Seller will not lease, convey, transfer, assign, mortgage, encumber, or pledge, whether absolutely or to secure a debt, any part of or any interest in the Property or enter into any agreement not relating to the construction of the Improvements that grants to any person any right with respect to the Property, any portion of the Property, or any interest in this Agreement. 10. Condemnation of the Property. (a) If between the Effective Date and the Closing Date, any condemnation or eminent domain proceeding is commenced that will result in the taking of any part of the Property, Purchaser may, at Purchaser's election, either: (1) Terminate this Agreement by giving written or cmailed notice to the Seller and the Escrow Agent (in which event all remaining funds or other things deposited in Escrow by Purchaser, including without limitation, the Deposit, shall be returned to the Purchaser immediately from Escrow, together with any interest earned thereon and all fees and costs charged by the Escrow Agent shall be paid one-half (1/2) by the Seller and one-half (1/2) by the Purchaser; or (2) Proceed with the Closing with no reduction in the Purchase Price, in which event the Seller shall assign to the Purchaser all of the Seller's rights, titles and interests to any award made for the condemnation or eminent domain action. 15 Attachment 2 (b) Notice. If the Seller obtains notice of the commencement of or the threatened commencement of eminent domain or condemnation proceedings with respect to all of any portion of the Property, the Seller shall notify the Purchaser in writing. 11. Broker's Commission. (a) No Brokers. The Seller and Purchaser each hereby represent and warrant to one another that they have not engaged the services of any real estate agent or broker with respect to the transaction that is the subject of this Agreement. (b) Indemnity. The Purchaser and the Seller each agree that, to the extent any real estate commission, brokerage commission or finder's fee shall be earned or claimed in connection with this Agreement or the Closing, the payment of such fee or commission, and the defense of any action in connection therewith, shall be the sole and exclusive obligation of the party who requested (or is alleged to have requested) the services of the broker or finder. In the event that any claim, demand or cause of action for any such commission or finder's fee is asserted against the party to this Agreement who did not request such services (or is not alleged to have requested such services), the party through whom the broker or finder is making the claim shall indemnify, defend (with an attorney of the indemnitee's choice), protect and hold harmless the other from and against any and all such claims, demands and causes of action and expenses related thereto, including, without limitation, attorneys' fees and costs. (c) Survival. The provisions of this Section 11 shall survive the Closing or termination of this Agreement. 12. Assignment. The Purchaser shall not assign any of its rights or delegate any of its duties under this Agreement without the prior written consent of the Seller, which consent may be withheld or granted in Seller's sole and absolute discretion; provided, however, the Purchaser may assign this Agreement to an entity in which the Purchaser has a controlling or majority interest without the prior written consent of the Seller provided Purchaser and such assignee execute an assignment agreement in form and substance reasonably acceptable to Seller. 13. Notices. All notices under this Agreement shall be in writing and sent (a) by certified or registered mail, return receipt requested, in which case notice shall be deemed delivered three (3) Business Days after deposit, postage prepaid in the United States Mail, (b) overnight by a nationally recognized overnight courier such as UPS Overnight, or FedEx, in which case notice shall be deemed delivered one (1) Business Day after deposit with that courier, (c) by personal delivery, in which case notice shall be deemed delivered upon the actual date of delivery, or (d) by email, in which case notice shall be deemed delivered upon the actual date of delivery. All notices shall be delivered to the following addresses: If to Seller: Stephen Randolph Johnston, Paul William Ralph and Michelle Leann Hooper Ralph 16 Attachment 2 If to Purchaser: Copy to: Facsimile No. Email: City of National City Attn: Brad Raulston 1243 National City Boulevard National City, CA 91950 Facsimile No. (619) 336-4286 Email: braulston@nationalcityca.gov Christensen & Spath LLP Attention: Walter F. Spath III 550 West C Street, Suite 1660 San Diego, CA 92101 Facsimile No. (619) 236-8307 Email: wfs@candslaw.net The addresses above may be changed by written notice to the other party; provided however, that no notice of a change of address shall be effective until actual receipt of the notice. 14. Risk of Loss. (a) Damage or Destruction. Subject to the provisions of this Section 14(a), the risk of loss or damage to the Property until the close of Escrow will be borne by Seller. Upon the occurrence of any damage to or destruction of the Property, Seller shall within thirty (30) days after the occurrence of such damage or destruction give written notice to Purchaser ("Damage Notice") specifying the estimated cost to repair or restore the Property and an estimate of the insurance proceeds, if any, that will be available with respect to such damage or destruction. The close of Escrow shall be appropriately delayed to provide adequate time for Seller to give the Damage Notice and Purchaser to make its election provided for below. (b) Damage in Excess of $100,000. If prior to the close of Escrow there is damage to or destruction of the Property that will cost in excess of One Hundred Thousand Dollars ($100,000) to repair or restore, Purc ser shall have the right by written notice given to Seller within ten (10) days of Purchaser receiving the Damage Notice, to elect to: (i) close Escrow in such damaged condition, in which event the Purchase Price shall not be reduced (but the Seller shall be obligated to pay the deductibles under the applicable insurance policy or policies) and Seller shall not be obligated to repair or restore the Property and all insurance proceeds shall be assigned and payable to Purchaser, and if Seller receives any such insurance proceeds, they shall be immediately remitted by Seller to Purchaser at Closing or, if received by Seller after Closing, promptly after receipt; (ii) terminate this Agreement, in which event the Deposit and all interest accrued thereon shall be immediately returned to Purchaser, and neither party shall have any further rights or obligations to the other party, except neither party shall be relieved of any obligations provided for in this Agreement which expressly survives its termination. 17 Attachment 2 (c) Damage of $100.000 or Less. If prior to the close of Escrow there is damage to or destruction of the Property that will cost One Hundred Thousand Dollars ($100,000) or less to repair or restore, Purchaser shall nevertheless close Escrow with the Property in such damaged condition, the Purchase Price shall not be reduced (but the Seller shall be obligated to pay the deductibles under the applicable insurance policy or policies) and Seller shall not be obligated to repair or restore the Property, and all insurance proceeds shall be assigned and payable to Purchaser, and if Seller should receive any such insurance proceeds, they shall be immediately remitted to Purchaser. 15. Prorations. Real property taxes and assessments and utility costs, and other expenses of operating the Property (provided, however, no proration shall be made with regard to any capital improvements) shall be prorated as of the close of Escrow. Seller shall pay all documentary transfer taxes. Seller shall pay all real property taxes and assessments applicable to the period prior to the close of Escrow, and if any such taxes are unpaid after the close of Escrow, then Seller shall pay them promptly and in any event within ten (10) days after Purchaser's request (which shall include a copy of the relevant tax bill). 16. General Provisions. (a) Governing Law. This Agreement shall be interpreted and construed in accordance with California law, without regard to any choice of law principles. (b) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (c) Captions. The captions in this Agreement are inserted for convenience of reference and in no way define, describe or limit the scope or intent of this Agreement or any of the provisions of this Agreement. (d) Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties and their respective legal representatives, successors, heirs and permitted assigns. (e) Modifications; Waiver. No waiver, modification, amendment, discharge or change of this Agreement shall be valid unless it is in writing and signed by the party against which the enforcement of the modification, waiver, amendment, discharge or change is sought. (f) Entire Agreement. This Agreement contains the entire agreement between the parties relating to Purchaser's acquisition of the Property from the Seller and all prior or contemporaneous agreements, understandings, representations or statements, oral or written, are superseded. (g) Partial Invalidity. Any provision of this Agreement which is unenforceable, invalid, or the inclusion of which would adversely affect the validity, legality, or enforcement of this Agreement shall have no effect, but all the remaining provisions of this Agreement shall remain in full effect. I8 Attachment 2 (h) Survival. Provisions of this Section 15 shall survive the Closing or the termination of this Agreement. (i) No Third -Party Rights. Nothing in this Agreement, express or implied, is intended to confer upon any person, other than the parties to this Agreement and their respective successors and assigns, any rights or remedies. (j) Time of Essence. Time is of the essence in this Agreement. (k) Attorneys' Fees. The parties agree that the prevailing party in litigation for the breach and/or interpretation and/or enforcement of the terms of this Agreement shall be entitled to their expert witness fees, if any, as part of their costs of suit, and attorneys' fees as may be awarded by the court, pursuant to California Code of Civil Procedure ("CCP") Section 1033.5 and any other applicable provisions of California law, including, without limitation, the provisions of CCP Section 998. All claims, disputes, causes of action or controversies shall be subject solely to the jurisdiction of the San Diego Superior Court, Downtown Branch. (1) Relationship. Nothing contained in this Agreement shall be deemed or construed by the parties or by any third person to create a relationship of principal and agent or partnership or a joint venture between the Purchaser and the Seller or between any of them and any third party. (m) Recording. Neither this Agreement nor a memorandum hereof shall be recorded. (n) Purchaser Approval. Where this Agreement refers to an action or approval of the Purchaser, it shall mean the approval of the Community Development Executive Director of the Purchaser, or designee, unless otherwise provided. (o) Exhibits and Recitals Incorporated. All exhibits referred to in this Agreement are hereby incorporated in this Agreement by this reference, regardless of whether or not the exhibits are actually attached to this Agreement. The Recitals to this Agreement are hereby incorporated in this Agreement by this reference. (Ip) Independent Counsel. Seller and Purchaser each acknowledge that: (a) they have been given the opportunity to be represented by independent counsel in connection with this Agreement; (b) they have executed this Agreement with the advice of such counsel, if such counsel was retained; and (c) this Agreement is the result of negotiations between the parties hereto and the advice and assistance of their respective counsel, if such counsel was retained. The fact that this Agreement was prepared or negotiated by Purchaser's or Seller's counsel as a matter of convenience shall have no import or significance. Any uncertainty or ambiguity in this Agreement shall not be construed against either party due to the fact that Purchaser's or Seller's counsel prepared or negotiated this Agreement in its final form. (q) 1031 Exchange. In order to effect an Internal Revenue Code section 1031 tax - deferred exchange of the Property, Seller has the right to engage an accommodator to fulfill 19 Attachment 2 Seller's obligations hereunder; in which case Purchaser shall cooperate to accomplish such exchange provided each of the following conditions are satisfied: (i) Purchaser shall, in such cooperation, incur no cost, liability or obligation for consideration (or otherwise) other than the costs and consideration called for in this Agreement; and (ii) the Closing shall not be delayed or prevented. (r) Tolling of Deadlines. Any periods of time, deadlines or time or day limitations set forth in this Agreement, including without limitation, the Due Diligence Period, the deadline for Closing, the deadline for making the Deposit, shall all be automatically extended by one (1) Business Day for each Business Day that the Seller fails to timely provide any notice, report, materials, studies, documentation or other information required by this Agreement. (s) Capacity and Authority. All individuals signing this Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, represent and warrant that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. SELLER: Stephen Randolph Johnston Paul William Ralph Michelle Leann Hooper Ralph [SIGNATURES CONTINUED ON FOLLOWING PAGE] 20 Attachment 2 PURCHASER: City of National City By: Print Name: Its: Approved as to Form: By: Claudia Gacitua Silva City Attorney 21 Attachment 2 EXHIBIT "A" PROPERTY LEGAL DESCRIPTION Real property in the City of National City, County of San Diego, State of California, described as follows: Lots 23 and 24 in Block 237 of National City, in the City of National City, County of San Diego, State of California, according to Map thereof No. 348, filed in the Office of the County Recorder of San Diego County, October 2, 1882. APN: 559-095-09-00 22 Attachment 2 EXHIBIT "B" GRANT DEED WHEN RECORDED MAIL TO: APN: 559-095-09-00 MAIL TAX STATEMENTS TO: SPACE ABOVE THIS LINE FOR RECORDER'S USE GRANT DEED FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, Stephen Randolph Johnston, an unmarried man as to an undivided 50% interest, and Paul William Ralph and Michelle Leann Hooper Ralph, husband and wife as joint tenants as to an undivided 50% interest, as tenants in common hereby GRANT to the City of National City the following described real property in the County of San Diego, State of California: Lots 23 and 24 in Block 237 of National City, in the City of National City, County of San Diego, State of California, according to Map thereof No. 348, filed in the Office of the County Recorder of San Diego County, October 2, 1882. Stephen Randolph Johnston Paul William Ralph Michelle Leann Hooper Ralph Dated , 2014 Dated , 2014 Dated , 2014 23 Attachment 2 ACCEPTANCE This is to certify that the interest(s) in real properly conveyed by this instrument to the City of National City, are hereby accepted by the undersigned officer on behalf of the City of National City, pursuant to authority conferred by resolution of the City of National City, Resolution No. , adopted on , 2014, and the grantee consents to recordation thereof by its duly authorized officer. City of National City By: Dated: , 2014 Print Name: Its: Approved as to Form: By: Claudia Gacitua Silva City Attorney 24