Vallejo City Council
March 22, 2022

a total of fifty-five (55) projects.

Thirty-five (35) of those projects are identified in the published Vallejo FY 2020-21 CIP Budget book. While at the time the Bond proposal anticipated an issuance of $27M, due to record-setting low interest rates at the time of the bond sale (January 2021), the annual projected debt service funded an issuance of $52M, an addition of $25M dollars earmarked for investment in the drinking water system infrastructure for the long term benefit of system reliability for customers. Specialized design and consultant work is a prerequisite to developing the scope and framework for the resulting construction projects. The Bond Issuance requires a minimum of 80% of bond funds be spent within three (3) years. Current staffing levels in Water Engineering are not sufficient to support this requirement while managing the existing workload.

In order to meet the current and anticipated needs for the Water Department’s Capital Improvement Projects which will be funded through the Bond Issuance, as well as emerging critical maintenance needs, City staff issued a Request for Qualifications (RFQ) asking that qualified consultants submit a Statement of Qualifications (SOQ) demonstrating their ability to perform the following services as related specifically to the Water industry in the following major categories:
 Program/Project Management
 Pipeline Design
 Pump Station and Tank Studies, Assessments, and Design  Water Treatment Plant Studies, Assessments, and Design  Earthen Dams and Associated Geotechnical and Structural Engineering  Hydrology Evaluations
 Water Distribution System Hydraulic Modeling
 Electrical Engineering
 Water Resources Management
 Environmental Permitting, CEQA and Restoration
 Construction Management
 Telecommunication Services
The RFQ for On-Call Water Engineering Consulting was released on July 12, 2021. Twentythree proposals were submitted by the due date of August 9, 2021. Staff reviewed the SOQs and ranked each firm by scoring them based on the following criteria as listed in the RFQ:
 Firm’s relevant experience and familiarity with issues applicable to the City’s needs. (50%)  Qualifications of the firm and assigned individuals. (25%)  Fee structure and cost-effectiveness of the consultants. (15%)  Reference checks. (10%)
Date: March 22, 2022
Subject: ADOPT RESOLUTION APPROVING AN ON-CALL CONSULTANT AND PROFESSIONAL

SERVICES AGREEMENT AND A DESIGN PROFESSIONAL SERVICES AGREEMENT WITH GHD, INC. FOR WATER ENGINEERING SERVICES AND DESIGN SERVICES

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME IN A TOTAL AMOUNT NOT-TO-EXCEED $2 MILLION AND LIMITED TO $500,000 PER YEAR FOR FOUR YEARS AS PART OF THE CITY’S PROGRAM FOR UPGRADING AND

REPLACING OUTDATED CITY WATER INFRASTRUCTURE

Due to the extensive responsibilities of the Water Department Engineering team and bond obligations, the firms represented by each of the contracts included with this staff report were selected to best meet those needs. These firms possess various requested areas of expertise as set forth in each contract, have recent experience handling on-call services for municipalities, are available to commence services immediately, and have resources and staffing to complete assignments on a timely basis.

Each of the firms have been notified that they are being recommended for agreements in an amount not to exceed $500,000 annually over the initial four-year term of the contract. The specific scope of services, schedule, and cost of work will be defined on a statement of work basis. The statement of work will be signed by the Water Director and the consulting firm prior to beginning work.

GHD Inc., proposed in the areas of Water Resources Management; Environmental Permitting, CEQA & Restoration; and Construction Management; Pipelines; Pump Stations and Tanks; Water Treatment Plants; and Electrical Engineering and will be awarded both a Design Professional Agreement and a Consultant and Professional Agreement. A Design Professional Agreement is an agreement for consultants to provide the design and specifications required for a capital project. A Consultant and Professional Agreement covers a similar range of consulting services, such as guidance, plan review, feasibility studies, and planning studies.

However, it does not include design criteria.

Staff recommends authorizing the City Manager to execute agreements with GHD, Inc. This action will authorize the City Manager to execute agreements that will establish a pool of professional consultants under contract with the City through June 30, 2026, with an option to extend agreements for one year.

FISCAL IMPACT
This proposed action will not have any direct impact on the General Fund. Funds to pay each firm for asneeded consultant services in an amount not to exceed $500,000 annually over the initial four-year term contract will come from existing (and future) capital improvement project budgets within the Water Enterprise Fund based on allocated bond funding. The contracts also include a potential one-year extension in a not-toexceed amount of $500,000.

ENVIRONMENTAL REVIEW
This action is exempt from the California Environmental Quality Act (CEQA) because it is not a project which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, pursuant to CEQA Guideline section 15378.

ATTACHMENTS

1. Resolution Awarding On-Call Contracts_GHD CAO Stamp

2. GHD_Consultant & Professional Services Agreement_Complete (1) CAO stamp

3. GHD_Design Professional Services Agreement_Complete (1) Date: March 22, 2022
Subject: ADOPT RESOLUTION APPROVING AN ON-CALL CONSULTANT AND PROFESSIONAL

SERVICES AGREEMENT AND A DESIGN PROFESSIONAL SERVICES AGREEMENT WITH GHD, INC. FOR WATER ENGINEERING SERVICES AND DESIGN SERVICES

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME IN A TOTAL AMOUNT NOT-TO-EXCEED $2 MILLION AND LIMITED TO $500,000 PER YEAR FOR FOUR YEARS AS PART OF THE CITY’S PROGRAM FOR UPGRADING AND

REPLACING OUTDATED CITY WATER INFRASTRUCTURE

CONTACT
Beth Schoenberger, Acting Water Director (707) 648-5439 [email protected]
Kent Carothers, P.E. Water Engineering Manager (707) 648-4309 [email protected]
Approved as to form:

By: for
Veronica Nebb, City Attorney
RESOLUTION NO. 22- _____ N.C.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF VALLEJO

APPROVING AND AWARDING A DESIGN PROFESSIONAL AGREEMENT AND ON-CALL CONSULTANT AND PROFESSIONAL SERVICES CONTRACT TO GHD, INC. FOR WATER

ENGINEERING CONSULTING AND DESIGN SERVICES AND AUTHORIZING THE CITY

MANAGER TO EXECUTE SAME
WHEREAS, the Water Department recently updated its FY2021-2022 Capital Improvement Program (CIP) to incorporate a portion of $52 million in proceeds received in February 2021 from a Bond Issuance and is now embarking on an aggressive program to update its infrastructure; and
WHEREAS, the City of Vallejo Water Department Engineering division current staffing level is not sufficient to support the design and implementation of the current CIP, requiring outside consultants to provide technical expertise on a range of disciplines necessary to complete bondfunded CIP projects; and WHEREAS, the City of Vallejo Water Department Engineering Division requires a broad spectrum of consultant expertise, experience, and support to implement the purpose and required timeframe for implementation of the bond funded projects on top of their existing engineering duties in the Department; and
WHEREAS, on July 12th, 2021, the City of Vallejo Water Department published the Request for Qualification for On-Call Water Engineering Consulting Services requesting qualifications that could cover twelve water engineering specific disciplines in order to create a readily-available pre-screened group of qualified consultants to be deployed as-needed to a wide range of technical specialties necessary to successfully complete the bond-funded CIP projects in a timely and high quality manner; and
WHEREAS, twenty-three proposals were received from the following consulting firms: 4Leaf, Balance Hydrologics, BKF Engineers, Carollo Engineers, Consolidated CM, Dewbery, EKI, FreyerLaureta, GEI Consultants, GHD, HDR, HydroScience, Interwest, Lee and Ro, NCE, NexGen, Park Engineering, Sandis, Schaaf & Wheeler, Sequoia, West Yost, WRA and Zanjero/Tully & Young.

WHEREAS, the City of Vallejo Water Department created a selection panel consisting of licensed engineers and qualified project management professionals. Each proposal was given a score based on the demonstrated understanding of the services requested, the firm’s relevant experience and familiarity with issues applicable to the project, the qualifications of the firm and assigned individuals, the acceptability and scope of service capabilities, and the fee structure; and
WHEREAS, seventeen consultants were selected to provide a minimum of two consultants per discipline to cover all twelve disciplines with the intent to obtain expertise within the industry and competitive pricing within each discipline; and
WHEREAS, GHD, Inc. is included in this resolution to provide Water Resources Management; Environmental Permitting, CEQA & Restoration; and Construction Management; Pipelines; Pump Stations and Tanks; Water Treatment Plants; and Electrical Engineering; and WHEREAS, two types of contracts can be awarded, a Design Professional Services contract and a Consultant and Professional Services Agreement; and WHEREAS, each contract awarded is not to exceed $500,000 annually for four years and includes the option to extend for up to one year; and
WHEREAS, a total of two contracts are included in this resolution; and WHEREAS, the City’s Water Department has sufficient money in its Water Enterprise Funds to pay for this work.

NOW, THEREFORE BE IT RESOLVED that the Council hereby approves contracts between the City of Vallejo and GHD, Inc. in an amount not to exceed $500,000 per year for four years with an option to extend for an additional year at $500,000, to be paid from the Water Department’s Water Enterprise Funds and authorizes the City Manager to execute same.

Adopted by the City Council of the City of Vallejo at a regular meeting held on March 22, 2022, with the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
______________________________________

ROBERT MCCONNELL, MAYOR
ATTEST:
______________________________________
DAWN G. ABRAHAMSON, CITY CLERK
Consultant and Professional Services Agreement (Revised 01.2019) Page 1 of 10 Approved as to form:

By: for
Veronica Nebb, City Attorney

CONSULTANT AND PROFESSIONAL SERVICES AGREEMENT
This Consultant and Professional Services Agreement ("Agreement") is made at Vallejo, California, dated for reference this 22nd day of March, 2022, by and between the City of Vallejo, a municipal corporation ("City"), and GHD, Inc., a California corporation, hereinafter referred to as “Consultant”, who agree as follows:

1. Services. Subject to the terms and conditions set forth in this Agreement, Consultant shall provide the City professional services as specified in Exhibit A, entitled “Scope of Work.”

2. Payment. City shall pay Consultant for services rendered pursuant to this Agreement at the times and in the manner set forth in Exhibit B, entitled “Compensation.” The payments specified in Exhibit B shall be the only payments to be made to Consultant for services rendered pursuant to this Agreement.

3. Facilities and Equipment. Consultant shall, at its sole cost and expense, furnish all facilities and equipment which may be required for furnishing services pursuant to this Agreement.

4. Indemnification. Consultant shall indemnify, hold harmless, and defend City, its officers, officials, directors, employees, agents, volunteers and affiliates and each of them from any and all claims, demands, causes of action, damages, costs, expenses, actual attorney’s fees, consultant’s fees, expert fees, losses or liability, in law or in equity, of every kind and nature whatsoever arising out of or in connection with Consultant’s operations, or any subcontractor’s operations, to be performed under this agreement for Consultant’s or subcontractor’s tort negligence including active or passive, or strict negligence, including but not limited to personal injury including, but not limited to bodily injury, emotional injury, sickness or disease, or death to persons and/or damage to property of anyone, including loss of use thereof, caused or alleged to be caused by any act or omission of Consultant, or any subcontractor, or anyone directly or indirectly employed by any of them or anyone for the full period of time allowed by the law, regardless to any limitation by insurance, with the exception of the sole negligence or willful misconduct of the City.

The provisions of this section shall survive the expiration or termination of this Agreement.

Consultant and Professional Services Agreement (Revised 01.2019) Page 2 of 10

5. Insurance Requirements. Consultant agrees to comply with all of the Insurance Requirements set forth in Exhibit C, entitled “Insurance Requirements for Consultant.” Failure to maintain required insurance at all times shall constitute a default and material breach.

6. Accident Reports. Consultant shall immediately report (as soon as feasible, but not more than 24 hours) to the City Risk Manager any accident or other occurrence causing injury to persons or property during the performance of this Agreement. The report shall be made in writing and shall include, at a minimum: (a) the names, addresses, and telephone numbers of the persons involved, (b) the names, addresses, and telephone numbers of any known witnesses, (c) the date, time, and description of the accident or other occurrence.

7. Conflict of Interest. Consultant warrants and represents that to the best of its knowledge, there exists no actual or potential conflict between Consultant’s family, business, real property or financial interests and the services to be provided under this Agreement. Consultant shall comply with the City of Vallejo Conflict of Interest Code and not enter into any contract or agreement during the performance of this Agreement which will create a conflict of interest with its duties to City under this Agreement. In the event of a change in Consultant’s family, business, real property, or financial interests occurs during the term of this Agreement that creates an actual or potential conflict of interest, then Consultant shall disclose such conflict in writing to City. Every individual who performs services on behalf of Consultant pursuant to this Agreement must file a full Statement of Economic Interests (also known as Form 700) with the City Clerk if the work of the individual involves making a governmental decision whether to issue, deny, suspend, or revoke any permit, license, application, certificate, approval, order, or similar authorization or entitlement; authorizes the City to enter into, modify, or renew a contract; grants City approval of specifications for a contract; adopts or approves for the City any policy, standard or guideline; lobbies on behalf of the City, or performs the same or substantially all the same duties for the City that would otherwise be performed by an individual holding a position specified in the City’s Conflict of Interest Code.

8. Independent Contractor. Consultant is an independent contractor. Neither Consultant nor any of Consultant’s officers, employees, agents, or subcontractors, if any, is an employee of City by virtue of this Agreement or performance of any services pursuant to this Agreement. City shall have the right to control Consultant only insofar as the results of Consultant’s services rendered pursuant to this Agreement; however, City shall not have the right to control the means by which Consultant accomplishes services pursuant to this Agreement.

9. Licences, Permits, Etc. Consultant represents and warrants to City that all consultant services shall be provided by a person or persons duly licensed by the State of California to provide the type of services to be performed under this Agreement and that Consultant has all the permits, qualifications and approvals of Consultant and Professional Services Agreement (Revised 01.2019) Page 3 of 10 whatsoever nature which are legally required for Consultant to practice its profession. Consultant represents and warrants to City that it shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement any licenses, permits, and approvals which are legally required for Consultant to practice its profession.

10. Business License. Consultant, and its subcontractors, has obtained or agrees to apply prior to performing any services under this Agreement to City’s Finance Department for a business license, pay the applicable business license tax and maintain said business license during the term of this Agreement. The failure to obtain such license shall be a material breach of this Agreement and grounds for termination by City. No payments shall be made to Consultant until such business license(s) has been obtained.

11. Standard of Performance. Consultant shall provide products and perform all services required pursuant to this Agreement in accordance with generally accepted professional practices and principles and in a manner consistent with the level of care and skill ordinarily exercised under similar conditions by a member of Consultant’s profession currently practicing in California.

Consultant is responsible for making an independent evaluation and judgment of all conditions affecting performance of the work, including without limitation applicable federal, state, and local laws and regulations, and all other contingencies or considerations.

Consultant’s responsibilities under this section shall not be delegated. Consultant shall be responsible to City for acts, errors, or omissions of Consultant’s subcontractors.

Consultant is responsible for making an independent evaluation and judgment of all conditions affecting performance of the work and shall prepare plans, reports, and/or other work products in such a way that additional costs will not be incurred beyond a project budget approved or amended by the City Manager or his or her designee.

Whenever the scope of work requires or permits review, approval, conditional approval or disapproval by City, it is understood that such review, approval, conditional approval or disapproval is solely for the purposes of administering this Agreement and determining whether the Consultant is entitled to payment for such work, and not be construed as a waiver of any breach or acceptance by the City of any responsibility, professional or otherwise, for the work, and shall not relieve the Consultant of responsibility for complying with the standard of performance or laws, regulations, industry standards, or from liability for damages caused by negligent acts, errors, omissions, noncompliance with industry standards, or the willful misconduct of Consultant.

Consultant and Professional Services Agreement (Revised 01.2019) Page 4 of 10

12. Force Majeure. Neither party shall be considered in default of this Agreement to the extent performances are prevented or delayed by causes or circumstances beyond either party’s reasonable control, such as war, riots, strikes, lockouts, work slowdown or stoppage, acts of God, such as floods or earthquakes, and electrical blackouts or brownouts.

In the event that the Consultant is unable to meet the completion date or schedule of services, Consultant shall immediately inform the City Representative of this in writing. If additional time is required to perform the work, the City Representative may adjust the schedule.

13. Time is of the Essence. Time is of the essence in this Agreement. Any reference to days means calendar days, unless otherwise specifically stated.

14. Personnel. Consultant agrees to assign only competent personnel according to the reasonable and customary standards of training and experience in the relevant field to perform services under this Agreement. Failure to assign such competent personnel shall constitute grounds for termination of this Agreement.

The payment made to Consultant pursuant to this Agreement shall be the full and complete compensation to which Consultant and Consultant’s officers, employees, agents, and subcontractors are entitled for performance of any work under this Agreement. Neither Consultant nor Consultant’s officers or employees are entitled to any salary or wages, or retirement, health, leave or other fringe benefits applicable to employees of the City. The City will not make any federal or state tax withholdings on behalf of Consultant. The City shall not be required to pay any workers' compensation insurance on behalf of Consultant.

Consultant shall pay, when and as due, any and all taxes incurred as a result of Consultant’s compensation hereunder, including estimated taxes, and shall provide City with proof of such payments upon request.

15. Consultant Not Agent. Except as authorized under this Agreement or as City may authorize in a letter of authorization signed by the City Manager or his or her designee, Consultant shall have no authority, express or implied to act on behalf of City in any capacity whatsoever as an agent. Consultant shall have no authority, express or implied, under this Agreement, to bind City to any obligation whatsoever.

16. Term. The term of this Agreement shall commence on March 8, 2022, and shall continue in full force and effect until June 30, 2026.

City shall, at its discretion, have the right to extend the term of this Agreement, in intervals of one year, by written notice to Design Professional. The total duration Consultant and Professional Services Agreement (Revised 01.2019) Page 5 of 10 of this Agreement, including the exercise of any options under this section, shall not exceed June 30, 2027.

If the term of this Agreement extends into fiscal years subsequent to that in which it is approved, such continuation of the Agreement is contingent on the appropriation of funds for such purpose by the City Council of the City of Vallejo.

If funds to effect such continued payment are not appropriated, Consultant agrees to terminate any services supplied to City of Vallejo under this Agreement, and relieve City of any further obligation therefore.

17. Termination or Abandonment by City. The City has the right, at any time and in its sole discretion, to immediately terminate or abandon any portion or all of the services to be provided under this Agreement by giving notice to Consultant.

Upon receipt of a notice of termination, Consultant shall perform no further work except as specified in the notice. Before the date of termination, Consultant shall deliver to City all City records and documents, all work product, whether completed or not, as of the date of termination and not otherwise previously delivered.

The City shall pay Consultant for services performed in accordance with this Agreement before the date of termination. If this contract provides for payment of a lump sum for all services or by task and termination occurs before completion of the work or any defined task which according to the performance schedule was commenced before the notice of termination, the fee for services performed shall be based on an amount mutually agreed to by City and Consultant for the portion of work completed in conformance with this Agreement before the date of termination. In addition, the City will reimburse Consultant for authorized expenses incurred and not previously reimbursed. The City shall not be liable for any fees or costs associated for the termination or abandonment except for the fees, and reimbursement of authorized expenses, payable pursuant to this section.

18. Products of Consulting Services. The work product, including without limitation, all writings, work sheets, reports, recordings, drawings, files, detailed calculations and other work products, whether complete or incomplete, of Consultant resulting from services rendered pursuant to this Agreement, shall become the property of City. Consultant agrees that all copyrights which arise from creation of the work under this Agreement shall be vested in the City and waives and relinquishes all claims to copyright or other intellectual property rights in favor of the City. City acknowledges that its use of the work product is limited to the purposes contemplated by the scope of work and that the Consultant makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the scope of work.

Documents submitted to the City in electronic format shall be formatted according to specifications provided by the City, or if not otherwise specified, in Microsoft Word, Excel, PowerPoint or other Microsoft Office Suite (2002) format as Consultant and Professional Services Agreement (Revised 01.2019) Page 6 of 10 appropriate for the particular work product or, if directed by the City Representative in Adobe Acrobat PDF format.

19. Cooperation by City. City shall, to the extent reasonable and practicable, assist and cooperate with Consultant in the performance of Consultant’s services hereunder.

20. Assignment and Subcontracting. Consultant shall not subcontract, assign or transfer voluntarily or involuntarily any of its rights, duties or obligation under this Agreement without the express written consent of the City Manager or his or her designee in each instance. Any attempted or purported assignment of any right, duty or obligation under this Agreement without said consent shall be void and of no effect.

If subcontracting of work is permitted, Consultant shall pay its subcontractor within ten (10) days of receipt of payment by City for work performed by a subcontractor and billed by the Consultant. Use of the term subcontractor in any other provision of this contract shall not be construed to imply authorization for Consultant to use subcontractors for performance of any service under this Agreement.

The City is an intended beneficiary of any work performed by Consultant’s subcontractor for purposes of establishing a duty of care between the subcontractor and City.

Any subcontractor or assignee consented to by City shall be bound by all terms and conditions of this agreement and the same shall be incorporated into and made a part of any assignment or subcontractor agreement.

21. Successors and Assigns. All terms, conditions, and provisions of this Agreement shall apply to and bind the respective heirs, executors, administrators, successors, and assigns of the parties. Nothing in this section is intended to affect the limitation on assignment.

22. Non-Discrimination/Fair Employment Practices.
(a) Consultant shall not, because of race, religious creed, color, sex, national original, ancestry, disability, medical condition, age, marital status or sexual orientation of any person, refuse to hire or employ, or to bar or discharge from employment, or to discriminate in compensation, or in terms, conditions or privileges any person, and every employee will receive equal opportunity for employment and shall be granted equal treatment with respect to compensation, terms, conditions or other privileges of employment, without regard to his race, religious creed, color, sex, national origin, ancestry, or disability, medical condition, age, marital status or sexual orientation.

Consultant and Professional Services Agreement (Revised 01.2019) Page 7 of 10 Consultant warrants and represents it is an equal opportunity employer and agrees it shall not discriminate on the basis of race, religious creed, color, sex, national origin, ancestry, disability, medical condition, age, marital status or sexual orientation in the selection and retention of employees, subcontractors or procurement of materials or equipment.

In all solicitations either by competitive bidding or negotiations made by Consultant for work to be performed under any subcontract, including procurement of materials or equipment, each potential subcontractor or supplier shall be notified by Consultant of Consultant’s obligation under this Agreement relative to nondiscrimination and fair employment practices.

Consultant shall include the above provisions of this section in every subcontract, including procurement of materials or equipment.
(b) Consultant agrees to comply with Title VII of the Civil Rights Act of 1964, as amended, the California Fair Employment Practices Act, the Americans with Disabilities Act of 1990, any other applicable federal and state laws and regulations and City ordinances and regulations hereinafter enacted.

23. Notices. All notices or instruments required to be given or delivered by law or this Agreement shall be in writing and shall be effective upon receipt thereof and shall be by personal service or delivered by depositing the same in any United States Post Office, registered or certified mail, postage prepaid, addressed to:

If to City: Beth Schoenberger, Acting Director
City of Vallejo, Water Department
202 Fleming Hill Road
Vallejo, CA 94589
If to Consultant: Alex Culick, Project Management Lead/Principal GHD, Inc.
655 Montgomery Street, Suite 1010
San Francisco, CA 94111
Any party may change its address for receiving notices by giving written notice of such change to the other party in accordance with this section.

Routine administrative communications shall be made pursuant to section 1 of Exhibit A.

24. Integration Clause. This Agreement, including all Exhibits, contains the entire agreement between the parties and supersedes whatever oral or written understanding they may have had prior to the execution of this Agreement. This Agreement shall not be amended or modified except by a written agreement executed by each of the parties hereto.

Consultant and Professional Services Agreement (Revised 01.2019) Page 8 of 10

25. Severability Clause. Should any provision of this Agreement ever be deemed to be legally void or unenforceable, all remaining provisions shall survive and be enforceable.

26. Law Governing. This Agreement shall in all respects be governed by the law of the State of California without regard to its conflicts of law rules. Litigation arising out of or connected with this Agreement shall be instituted and maintained in the courts of Solano County in the State of California or in the United States District Court, Eastern District of California, Sacramento, California, and the parties consent to jurisdiction over their person and over the subject matter of any such litigation in such courts, and consent to service of process issued by such courts.

27. Waiver. Waiver by either party of any default, breach or condition precedent shall not be construed as a waiver of any other default, breach or condition precedent or any other right hereunder.

28. Ambiguity. The parties acknowledge that this is a negotiated agreement, that they have had the opportunity to have this Agreement reviewed by their respective legal counsel, and that the terms and conditions of this Agreement are not to be construed against any party on the basis of such party's draftsmanship thereof.

29. Gender. All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, neuter, singular or plural, as the identifications of the person or persons, firm or firms, corporation or corporations may require.

30. Headings. The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

31. Compliance with Laws. Consultant will comply with all statutes, regulations and ordinances in the performance of all services under this Agreement.

32. Confidentiality of City Information. During the performance of services under this Agreement, Consultant may gain access to and use City information regarding, but not limited to, procedures, policies, training, operational practices, and other vital information (hereafter collectively referred to as "City Information") which are valuable, special and unique assets of the City. Consultant agrees that it will not use any information obtained as a consequence of the performance of services under this Agreement for any purpose other than fulfillment of Consultant’s scope of work , to protect all City Information and treat it as strictly confidential and proprietary to City, and that it will not at any time, either directly or indirectly, divulge, disclose or communicate in any manner any City Information to any third party, other than its own employees, agents or subcontractors who have Consultant and Professional Services Agreement (Revised 01.2019) Page 9 of 10 a need for the City Information for the performance of services under this Agreement, without the prior written consent of City, or as required by law.

Consultant shall treat all records and work product prepared or maintained by Consultant in the performance of this Agreement as confidential.

A violation by Consultant of this section shall be a material violation of this Agreement and will justify legal and/or equitable relief.

Consultant’s obligations under this section shall survive the completion of services, expiration or termination of this Agreement.

33. News and Information Release. Consultant agrees that it will not issue any news releases in connection with either the award of this Agreement, or any subsequent amendment of or efforts under this Agreement, without first obtaining review and approval of said news releases from City through the City Representative.

34. City Representative. The City Representative specified in Exhibit A, or the representative's designee, shall administer this Agreement for the City.

35. Counterparts. The parties may execute this Agreement in one or more counterparts, each of which shall be deemed an original, but all of which together shall be deemed one and the same instrument.

36. Facsimile Signature; Electronic Signature. This Agreement shall be binding upon the receipt of facsimile signatures or e-mailed by PDF or otherwise.

Any person transmitting his or her signature by facsimile or electronically shall promptly send an original signature to the other party pursuant to the notice provision of this Agreement. The failure to send an original shall not affect the binding nature of this Agreement.

37. Authority. The person signing this Agreement for Consultant hereby represents and warrants that he/she is fully authorized to sign this Agreement on behalf of Consultant.

38. Exhibits. The following exhibits are attached hereto and incorporated herein by reference:

Exhibit A, entitled “Scope of Work,” including any attachments Exhibit B, entitled “Compensation,” including any attachments Exhibit C, entitled “Insurance Requirements,” including attachments [SIGNATURES ON FOLLOWING PAGE]
Consultant and Professional Services Agreement (Revised 01.2019) Page 10 of 10 IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year shown below the name of each of the parties.

GHD, Inc.,
a California corporation
By:

Alex Culick
Project Management Lead / Principal
DATE:
(City Seal)

CITY OF VALLEJO,
a municipal corporation
By:

Mike Malone
Interim City Manager
DATE:

ATTEST:

By:

Dawn Abrahamson
City Clerk
APPROVED AS TO CONTENT:

Beth Schoenberger
Acting Water Director
APPROVED AS TO FORM:

For
Veronica A. F. Nebb
City Attorney
APPROVED AS TO INSURANCE:

Armond Sarkis
Risk Manager
Consultant and Professional Services Agreement (Revised 01.2019) Page 1 of 2 Exhibit A – Scope of Work

EXHIBIT A

SCOPE OF WORK

1. Representatives. The City Representative for this Agreement is:

Matt Brown, P.E., Senior Engineer
Water Department, City of Vallejo
202 Fleming Hill Road
Vallejo, CA 94589
[email protected]
The Consultant’s Representative for this Agreement is:

Alex Culick, Project Management Lead/Principal
GHD, Inc.
655 Montgomery Street, Suite 1010
San Francisco, CA 94111
[email protected]
All routine administrative communications between the parties will be between the above-named representatives and may be by personal delivery, mail, or electronic mail as agreed between the Consultant Representative and City’s Representative.

2. Services to be Provided. The Consultant will provide as-needed services for City of Vallejo Water Department projects as assigned by Water Department staff, in written Statements of Work, executed by Consultant before commencement of work on the project. At the discretion of Water Department staff, and considering the capabilities of Consultant, assignments shall be given to Consultant in Water Resources Management; Environmental Permitting, CEQA & Restoration; and Construction Management, as more fully set forth in Attachment 1 to Exhibit A, which is incorporated herein by this reference. City shall have no obligation to pay Consultant for any work performed by Consultant that is not set forth in this Agreement or in a Statement of Work.

3. Time for Performance. Consultant will perform services according to the schedule negotiated for each Statement of Work. If the schedule calls for the services to be performed in phases or discrete increments, Consultant shall not proceed from one phase or increment to the next without written authorization from the City’s Representative. Consultant will complete all services for any Statement of Work by the agreed upon date set forth in the Statement of Work.

4. Key Personnel. All of the individuals identified below are necessary for the successful prosecution of the services due to their unique expertise and depth and Consultant and Professional Services Agreement (Revised 01.2019) Page 2 of 2 Exhibit A – Scope of Work
breadth of experience. There shall be no change in the personnel listed below, without written approval of the City Representative. Consultant recognizes that the composition of this team was instrumental in the City’s decision to award the work to Consultant and that compelling reasons for substituting these individuals must be demonstrated for the City’s consent to be granted. Any substitutes shall be persons of comparable or superior expertise and experience. Failure to comply with the provisions of this section shall constitute a material breach of Consultant’s obligations under this Agreement and shall be grounds for termination.

Key personnel will be as identified in Statements of Work.

In mid-2021, the City expects to begin executing a prioritized list of projects identified in its Capital Improvement Program (CIP) that will require immediate resources using several On-call Consultants. These projects will be varied and will require consulting firms with diverse and specialized skill sets. Other services, such as conceptual-level studies, may be needed to support executable design of the CIP. The anticipated service categories are listed below.

1. PROGRAM/PROJECT MANAGEMENT
Consultant will serve as an extension of staff and may provide overall program and project management for projects. Familiarity with Caltrans Projects and their Right of Way (ROW) Manual may be beneficial. The Consultant will schedule and conduct remote project meetings with staff and may be required to work at least two (2) days a week in the Water Department Engineering office located at 202 Fleming Hill Road, Vallejo, California, under COVID-19 provisions for Solano County.

Potential projects include:
• Overseeing another consultant preparing the design of a large diameter pipeline in an area outside the City requiring coordination with Napa County. • Review of developer plans as part of the developer review process. • Assistance with developing project schedules and budgeting for CIP projects.
• Assist with the planning and implementation of a Water Exchange Policy and/or water supply agreements with neighboring municipalities. • Managing implementation of replacement of water meters across the service area.
• Management and tracking expenditures for numerous on-call consulting and contractor contracts.

2. PIPELINES
Consultant will have demonstrated capability and experience in design of new pipelines, which may include alignment studies, profile and plan drawings, hydraulic gradient drawings, selection and sizing of pipe, linings, coatings, fittings, valves, blow off vaults, air release vaults, corrosion protection methods, startup and shut down procedures, and trenchless installation methods including sliplining. Familiarity with Caltrans Projects and their Right of Way (ROW) Manual may be beneficial.

Potential projects include:
• Design of a large diameter raw water pipeline in an area outside the City requiring coordination with Napa County.

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ATTACHMENT 1 TO EXHIBIT A
• Design of the City's annual distribution main replacement projects. • Development of a water main prioritization list based on leak data, pipe characteristics and the City's pavement program.
• Design of the slip-lining of a 24-inch pipe with a 10-inch pipe within a Caltrans right-of-way.
• Management of potholing to locate utilities for a pipeline design project.

3. PUMP STATIONS AND TANKS
Consultant will have demonstrated capability and experience in performing feasibility studies, condition assessments, and design for upgrading existing and designing new pump stations and tanks. Tasks may include pump/motor sizing and selection, pipe sizing, hydraulic surge analysis, selection and sizing of valves, instrumentation and controls, pipe supports, site studies, electrical power requirements, etc.

Potential projects include:
• Design of a new pump station to replace a below-grade pump station in a busy street.
• Condition assessment of a hydropneumatic pump station and tank, and preparation of a report with recommended upgrades.
• Design of a series of 5-6 MG tanks to replace a 37 MG concrete lined reservoir.
• Preparation of specifications and obtaining quotes to replace pumps in kind at a pump station.
• The design and implementation of SCADA upgrades and integration with existing SCADA network.

4. WATER TREATMENT PLANTS
Consultant will have demonstrated capability and experience in water treatment plant processes and facilities. Consultant may perform feasibility studies, preliminary design, detailed design, and startup services for new or upgraded water treatment facilities; perform comparative analysis of treatment methods, including operational impacts, initial cost, life cycle cost, effectiveness of meeting treatment goals; plant siting studies; plant hydraulics; Supervisory Control and Data Acquisition (SCADA) requirements; and other requirements. Consultant may assist the Water Department in interactions and negotiations with the Department of Drinking Water (DDW) regarding design review and permit revisions for new or upgraded treatment facilities.

Consultant may be required to optimize existing water treatment plant processes, review standard operating procedures, and recommend changes, evaluate process/equipment requirements ahead of water source/quality changes, be V:\OWater\On-Call Consulting.Docx
familiar with existing and proposed water quality regulations and understand the impacts to the treatment plant processes.

Potential upcoming projects include:
• Design of a new 5 MGD water treatment plant featuring ozone, plate settling actiflow or Ml EX technologies.
• Design of replacement of flocculation and sedimentation equipment. • Condition assessment and design of the rehabilitation of chemical feed systems.
• The design and implementation of SCADA upgrades and integration with existing SCADA network.

5. EARTHEN DAMS AND ASSOCIATED GEOTECHNICAL AND STRUCTURAL

ENGINEERING
Consultant will have demonstrated capability and experience studying and designing improvements for earthen dams and their associated infrastructure such as spillways, fish releases and outlets. Consultant may be required to inspect dams and all appurtenant structures, including spillways and outlet towers, and be capable of evaluating deficiencies and the degree of hazard associates with the deficiencies, and to provide demonstrated experience in designing repairs to address such deficiencies. Consultant will demonstrate experience in the permitting and construction of dams, as well as the demolition of dams and/or related structures, and the development, design, and operation of pumped storage systems. Consultant will have experience with the regulatory agencies that govern dams, particularly the DSOD.

Consultant may perform geotechnical studies, as needed, to support other elements of the CIP (e.g., seismic evaluation or pipeline alignments).

Consultant may perform site investigations to gather data, take samples and measurements, and generally collect the information necessary to perform a structural analysis and evaluation of concrete foundations, tank and reservoir walls, pipe penetrations, all types of pipe, equipment supports, including the analysis of induced vibrations; perform the seismic analysis of such structures, including dams and related structures/appurtenances. Consultant will be capable of performing structural design for upgraded dam facilities.

Potential upcoming projects include:
• Alternatives analysis and cost estimates for raising an earthen dam. • Design of a new concrete lined spillway.
• Assessment and seismic upgrade design for an earthen dam. • Development of a program for landslide monitoring.
• Geotechnical study for a new water tank.

V;\OWater\On-Call Consulting.Docx

6. HYDROLOGY EVALUATIONS
Consultant will have demonstrated past successful experience in performing hydrologic evaluations, primarily to support the DOSD permitting and compliance.

Potential projects include:
• Preparation of inundation studies.
• Spillway modeling and sizing.
• Bathymetric studies to assess the available storage in a reservoir (lake) under different climactic conditions.

7. WATER DISTRIBUTION SYSTEM HYDRAULIC MODELING
Consultant will have successful experience in development and use of hydraulic models of water distribution systems. The City anticipates updating and converting our Geographic Information System (GIS) into a new hydraulic model. The new model will need to be calibrated and used to develop a new Water Master Plan as well as run various theoretical scenarios as part of the planning process for various projects.

Consultant will be capable of analyzing hydraulic systems such as transmission pipelines (i.e., raw water pipelines); treated water distribution systems such as pressure zones with pressure regulating valves, pump stations, tanks, and hydropneumatic zones; pump suction and discharge piping, treatment plant filter gallery piping, treatment plant hydraulics, and may prepare reports as needed to summarize and make recommendations. Consultant will have experience preparing master plans and capital improvement plans (annual budgeting) based on the hydraulic model output for water systems of a similar size.

Potential projects include:
• Fixing connectivity issues of the pipeline network in GIS and assessing SCADA data for importing into a hydraulic model.

Creation of a new hydraulic model for the City system.

Extended period Simulation (EPS) and static calibration of a hydraulic model
Performing fire flow testing.

Using the hydraulic model to prepare a Water Master Plan with recommended pipeline, pressure zone, and storage improvements.

Assessment of the sizing of new facilities (pipes, tanks, pump stations) to connect a new development to the system.

Assessment of downsizing a 37 MG reservoir to a series of 5-6 MG reservoirs.

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8. ELECTRICAL ENGINEERING
Consultant will be experienced in the design of both high and low voltage electrical power systems for water pump stations, water treatment plants; design of stationary and portable electric generator connections, integration of new equipment with existing facilities, work with PG&E on the City's behalf to prepare applications for new service, review code requirements as applicable, perform arc flash studies, develop single-line diagrams and other drawings as needed. Perform on-site startup activities, including oversight of functional and performance testing.

Potential projects include:

Arc flash studies at all the City's pump stations.

Assessment and replacement of constant speed drives with variable speed drives.

Condition assessments of electrical equipment at a water treatment plant.

Design of a permanent backup generator for a 10 MOD pump station.

Condition assessment, bidding and construction oversight of safety upgrades to a high voltage substation.

The design and implementation of remote operation and monitoring equipment and control protocols for existing valves.

Renovation of existing and design and install of new solar powered equipment.

Provide resiliency studies of existing facilities and to provide recommendations and design projects to enable continued operations during PSPS events.

9. WATER RESOURCES MANAGMENT
Consultant will have past successful experience in performing water resources management including evaluations to demonstrate available water supplies are sufficient to support proposed new developments or respond to drought conditions.

Consultant will be familiar with the North Bay Aqueduct and other state and federal water supplies and water rights, climate change impact projections, water demand projections, urban water management planning (UWMP), water exchange policy development, and water conservation.

Potential projects include:
• Preparation of a water supply assessment for a new residential development.
• Development of a water supply model to understand projected water supplies from the City's numerous water supply sources. • Develop and implement a sustainable water exchange policy during drought conditions.
• Prepare public outreach for drought policy measures.

V:\OWater\On-Call Consulting.Docx 11
• Coordinate with Regional, State and Federal Regulatory Agencies. • Update to an UWMP.

10. ENVIRONMENTAL PERMITTING, CEQA AND RESTORATION
Consultant will provide demonstrated experience in all aspects of environmental requirements, including National Pollutant Discharge Elimination System (NPDES) requirements. Storm Water Pollution Prevention (SWPP) requirements, environmental permits and the Califomia Environmental Quality Act (CEQA).

Consultant may be required to determine how environmental and CEQA permitting affect projects at each stage and provide guidance and recommendations for balancing design options with any and all regulatory agencies that may have purview over them. Consultant may perform biology, habitat/vegetation and wildlife studies. Consultant may be asked to design creek, habitat or landscape restoration.

Potential projects include:
• CEQA compliance, permitting and restoration for a dam upgrade project. • CEQA compliance, permitting and landscape design for the abandonment of a 16 MG reservoir in a residential neighborhood.
• CEQA compliance and permitting for a new pipeline crossing a creek.

11. CONSTRUCTION MANAGEMENT
Consultant will be competent in the provision of construction management services including conducting meetings, coordinating with design professionals and City staff, managing documentation, managing schedules, performing daily field inspections, and managing conflict resolution. Consultant will be expected to review contractor prevailing wage statements for compliance with Department of Industrial Relations (DIR) requirements. Materials testing is to be performed by others.

Potential projects include:
• Construction management for a new water tank or pump station. • Review of prevailing wage statements for the City's annual main replacement program.
• Construction management for construction of a new dam spillway. • Construction management of raw water transmission line replacements. • Construction management of treatment plant upgrades for flocculation, filter media, ozone generation, chemical storage facilities, and solar power upgrades.

V:\OWater\On-Call Consulting.Docx 12

12. TELECOMMUNICATION SERVICES
Consultant will perform analysis of antenna, microwave and communication systems and provide analysis of radiation patterns, antenna gain and efficiency for communication systems and integration of AMI metering devices for data collection and billing applications. Consultant will also provide analysis for communication tower design including monopole solutions for communication of data between facilities.

V:\OWater\On-Call Consulting.Docx 13
Consultant and Professional Services Agreement (Revised 01.2019) Page 1 of 3 Exhibit B - Compensation

EXHIBIT B

COMPENSATION

1. Consultant’s Compensation.

A. Services: City agrees to pay Consultant, at the rate(s) specified below, for those services set forth in Exhibit A of this Agreement and for all authorized reimbursable expenses, for a total not to exceed Two Million Dollars and 00 Cents as set forth below:

FISCAL YEAR NOT TO EXCEED AMOUNT
FY22 $500,000
FY23 $500,000
FY24 $500,000
FY25 $500,000
Consultant shall notify City in writing no later than thirty (30) days prior to the estimated date when Consultant will have billed City the maximum payment amount permitted under this Agreement, and Consultant shall provide City with an estimate of the additional compensation required to complete the project.

City agrees to pay Consultant for those services set forth in Exhibit A of this Agreement (identified by Statements of Work) and for all authorized reimbursable expenses upon satisfactory completion of the services and delivery of the work product.

B. Additional Services:

1. Additional Services are those services related to the scope of Services of Consultant as set forth in Exhibit A but not anticipated at the time of execution of this Agreement. Additional Services shall be provided only when a Supplemental Agreement authorizing such Additional Services is approved by the City Manager, or his or her designee. City reserves the right to perform any Additional Services with its own staff or to retain other Consultants to perform said Additional Services.

2. Consultant’s compensation for Additional Services shall be based on the total number of hours spent on Additional Services multiplied by the employees' appropriate billable hourly rate as established below. City, at its option, may negotiate a fixed fee for some or all Additional Services as the need arises. Where a fixed fee for Additional Services is established by mutual Agreement between City and Consultant, compensation to Consultant shall not exceed the fixed fee amount.

Consultant and Professional Services Agreement (Revised 01.2019) Page 2 of 3 Exhibit B - Compensation

2. Appropriate Billable Hourly Rates for Services and Additional Services. Consultant’s billable hourly rates shall be as listed in Attachment 1 of Exhibit B, attached hereto and incorporated herein by this reference.

3. Consultant’s Reimbursable Expenses. Reimbursable Expenses shall be limited to actual reasonable expenditures of Consultant for expenses that are necessary for the proper completion of the Services and shall only be payable if specifically authorized in writing in advance by City.

4. Payments to Consultant.

A. Payments to Consultant shall be made within a reasonable time after receipt of Consultant’s invoice, said payments to be made in proportion to services performed. Consultant may request payment on a monthly basis. Consultant shall be responsible for the cost of supplying all documentation necessary to verify the monthly billings to the satisfaction of City.

B. All invoices submitted by Design Professional shall be (1) billed on a month-to-month basis (i.e., the first of the month through the end of the month), (2) submitted by email to [email protected], and (3) must contain the following information:

1. Description of services billed under the invoice

2. Date of Invoice Issuance

3. Sequential Invoice Number

4. City’s Purchase Order Number

5. Statement of Work Number

6. Social Security Number or Taxpayer Identification Number

7. Amount of the Invoice (Itemize all Reimbursable Expenses)

8. Total Billed to Date
C. Items shall be separated into Services and Reimbursable Expenses.

Billings that do not conform to the format outlined above shall be returned to Consultant for correction. City shall not be responsible for delays in payment to Consultant resulting from Consultant’s failure to comply with the invoice format described above.

D. Request for payment shall be sent to:

Matt Brown, P.E., Senior Engineer
Engineering Division
City of Vallejo Water Department
c/o [email protected]
Consultant and Professional Services Agreement (Revised 01.2019) Page 3 of 3 Exhibit B - Compensation

5. Accounting Records of Consultant. Consultant shall maintain for three (3) years after completion of all services hereunder, all records under this Agreement, including, but not limited to, records of Consultant’s direct salary costs for all Services and Additional Services performed under this Agreement and records of Consultant’s Reimbursable Expenses, in accordance with generally accepted accounting practices. Consultant shall keep such records available for audit, inspection and copying by representatives of the City’s Finance Department or other government agencies during regular business hours upon twenty four (24) hours’ notice.

The obligations of Consultant under this section shall survive this Agreement.

6. Taxes. Consultant shall pay, when and as due, any and all taxes incurred as a result of Consultant’s compensation hereunder, including estimated taxes, and shall provide City with proof of such payments upon request.

7. Taxpayer Identification Number. Consultant shall provide City with Consultant’s complete Request for Taxpayer Identification Number and Certification, Form W-9, as issued by the Internal Revenue Service, and any other State or local tax identification number requested by City.

Rate Rate
A01 Senior Technical Director 1 $280 C03 Senior Admin Officer 1 $155 A02 Senior Technical Director 2 $260 C04 Senior Admin Officer 2 $125 A03 Senior Technical Director 3 $240 C05 Admin Officer 1 $105 A04 Technical Director 1 $225 C06 Admin Officer 2 $90
A05 Technical Director 2 $200 C07 Admin Officer 3 $75
A06 Senior Professional 1 $175 D01 Business Services Manager 1 $275 A07 Senior Professional 2 $160 D02 Business Services Manager 2 $255 A08 Professional 1 $140 D03 Senior Admin Officer 1 $215 A09 Professional 2 $125 D04 Senior Admin Officer 2 $170 A10 Professional 3 $115 D05 Admin Officer 1 $155
A11 Intern $85 D06 Admin Officer 2 $110
B01 Lead Design Technician 1 $255 D07 Admin Officer 3 $100 B02 Lead Design Technician 2 $230 D08 Admin Officer 4 $90 B03 Lead Design Technician 3 $210 D09 Admin Officer 5 $85 B04 Senior Design Technician 1 $170 D10 Admin Officer 6 $75 B05 Senior Design Technician 2 $160 S01 Senior Construction Manager $250 B06 Design Technician 1 $150 S02 Construction Manager $205 B07 Design Technician 2 $135 S03 Lead Site Engineer/Supervisor $175 B08 Drafting/Design 1 $125 S06 Lead Inspector $165
B09 Drafting/Design 2 $115 S07 Senior Inspector $150
B10 Drafting/Design 3 $105 S08 Inspector / Specialist 1 $135 B11 Drafting/Design 4 $95 S09 Inspector / Specialist 2 $110 B12 Intern Drafting/Design $85 S10 Clerk / Specialist 3 $80 C01 Business Services Manager 1 $250 S15 Operator/Laborer 1 $125 C02 Business Services Manager 2 $210 S16 Operator/Laborer 2 $105 S17 Operator/Laborer 3 $95
1 2
3 4
5 6
7 8
Reimbursement for direct expenses incurred for proposed services, including sub-consultant services, will be billed at cost plus 15%
FY 2022 US West Region Rate Schedule
Finance Class Code Finance Class Code
Rates are for employees of all GHD companies.

All travel cost will be invoiced at coach class rates. Lodging and meal expenses will be at cost unless per diem rate is negotiated.

GHD has implemented a system of billing for consumables on a per hour basis. Associated Project Cost (APC) is a unit cost replacing the individual tracking of some of the consumable costs directly related to projects.

Each year the total consumable audited costs are compiled from our general ledger including:

Reimbursement for vehicles used for proposed services will be at the federally approved mileage rates or at a negotiated monthly rate.

Overtime for non-exempt employees will be charged at 1.5 times the hourly billing rate.

If prevailing wage are applicable, the above billing rates and APC will be adjusted proportionate to the increase in labor cost
The Rate Schedule is subject to change annually.
- Office consumables including engineering supplies and postage - Reproduction consumable costs including equipment lease and maintenance, printing, and stationary - Communication consumables including telephone expenses - Equipment consumable including CADD, software, and IT expenses Associated project cost (APC) will be invoiced at the following rate:
b. Field Services/Construction Inspector APC: $11.50 / labor hour a. General Associated Project Charges APC: $6.50 / labor hour or 4% of labor costs → 3. Fee Schedule
GHD City of Vallejo On-Call Water Engineering Consulting 7 ATTACHMENT 1 TO EXHBIT B
Consultant and Professional Services Agreement (Revised 01.2019) Page 1 of 4 Exhibit C – Insurance Requirements

EXHIBIT C

INSURANCE REQUIREMENTS
Consultant shall procure and maintain for the duration of this Agreement, including any extensions thereto, insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of services hereunder by the Consultant, their agents, representatives, or employees or subcontractors. It shall be a requirement under this Agreement that any available insurance proceeds broader than or in excess of the specified minimum Insurance coverage requirements and/or limits shall be available to the Additional Insured. Furthermore, the requirements for coverage and limits shall be (1) the minimum coverage and limits specified in this Agreement; or (2) the broader coverage and maximum limits of coverage of any Insurance policy or proceeds available to the named Insured; whichever is greater. No representation is made that the minimum Insurance requirements of this agreement are sufficient to cover the obligations of the Consultant under this agreement.

1. Minimum Scope of Insurance. Coverage shall be at least as broad as:

A. Insurance Services Office form number GL 0002 covering Comprehensive General Liability and Insurance Services Office form number GL 0404 covering Broad Form Comprehensive General Liability; or Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001).

B. Insurance Services Office form number CA 0001 covering Automobile Liability, code 1 any auto and endorsement CA 0025.

C. Workers' Compensation insurance as required by the State of California and Employer's Liability Insurance.

D. Professional Liability insurance appropriate to the Consultant’s profession (Errors and Omission).

2. Minimum Limits of Insurance. Consultant shall maintain limits no less than:

A. General Liability: $2,000,000 per occurrence for bodily injury, personal injury, and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit.

B. Automobile Liability: $1,000,000 per accident for bodily injury and property damage.

Consultant and Professional Services Agreement (Revised 01.2019) Page 2 of 4 Exhibit C – Insurance Requirements
C. Workers’ Compensation insurance as required by the State of California, with Statutory Limits, and Employer’s Liability Insurance with limit of no less than $1,000,000 per accident for bodily injury or disease. If Consultant is not subject to California Workers’ Compensation requirements, Consultant shall file a completed Request for Waiver of Workers’ Compensation Insurance Form which may be obtained from the City prior to commencing any activity authorized hereunder.

D. Professional Liability (Errors and Omission): Insurance appropriates to the Consultant’s profession with $1,000,000 combined single limit per occurrence, and annual aggregate.

3. Deductible and Self-Insured Retention (SIR). Any deductibles or selfinsured retention must be declared to and approved by the City. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or selfinsured retention as respects the City of Vallejo, its officers, officials, employees and volunteers; or the Consultant shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. All SIRs must be disclosed to the City’s Risk Manager for approval and shall not reduce the limits of liability. Policies containing any SIR provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named Insured or the City.

4. Other Insurance Provisions.

A. Additional Insured Endorsements: The City of Vallejo, its officers, officials, employees, agents and volunteers are to be covered as Additional Insureds as respects; liability, including defense costs, arising out of activities performed by or on behalf of the Consultant; products and completed operations of the Consultant; premises owned, occupied or used by the Consultant; or automobiles owned, leased hired or borrowed by the Consultant. Additional Insured endorsements with respect to General Liability, Auto and Umbrella/Excess Insurance shall be attached to the Certificate of Insurance presented to the City.

B. 30 Days’ Notice of Cancellation Endorsements: Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City.

C. Waiver of Subrogation Rights Endorsement: The workers’ compensation policy required hereunder shall be endorsed to state that the workers' compensation carrier waives its right of subrogation against City, its officers, officials, employees, agents and volunteers, which might arise by reason of payment under such policy in connection with Consultant’s performance under this Consultant and Professional Services Agreement (Revised 01.2019) Page 3 of 4 Exhibit C – Insurance Requirements
Agreement. The waiver of subrogation rights endorsement in favor of the City of Vallejo shall be attached to the Certificate of Insurance.

D. The limits of Insurance required in this agreement may be satisfied by a combination of primary and umbrella or excess Insurance. Any umbrella or excess Insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and non-contributory basis for the benefit of the City of Vallejo before the City’s own Insurance or self-insurance shall be called upon to protect it as a named insured.

E. The insurance coverage shall contain no special limitations on the scope of protection afforded to the City of Vallejo, its officers, officials, employees, agents or volunteers. For any claims related to this project, the Consultant's insurance coverage shall be primary insurance as respects the City of Vallejo, its officers, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City of Vallejo, its officers, officials, employees, agents, or volunteers shall be excess of the Consultant's insurance and shall not contribute with it.

F. The Consultant's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability.

G. Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees, agents, or volunteers.

H. The City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

5. Acceptability of Insurers. The insurance is to be issued by companies licensed to do business in the State of California. The insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VII.

6. Verification of Coverage. Consultant shall furnish the City with certificates of insurance and original endorsements. The certificates and endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. All endorsements are to be received and approved by the City before work commences. The City reserves the right to obtain a full certified copy of any Insurance policy and endorsements. Failure to exercise this right shall not constitute a waiver of right to exercise later.

7. Subcontractors. Consultant shall include all subcontractors as insureds under its policies or shall furnish separate certificates and endorsements for each Consultant and Professional Services Agreement (Revised 01.2019) Page 4 of 4 Exhibit C – Insurance Requirements
subcontractor. All coverages for subcontractors shall be subject to all of the requirements stated herein.

8. Payment Withhold. City will withhold payments to Consultant if the certificates of insurance and endorsements required in Paragraph F, above, are canceled or Consultant otherwise ceases to be insured as required herein.

THIS BUSINESS LICENSE DOES NOT PERMIT A
BUSINESS THAT IS OTHERWISE PROHIBITED.

Business Name
Business Location
Business Owner(s)
License Number
Effective Date
Expiration Date

CITY OF VALLEJO

BUSINESS LICENSE
3760 KILROY AIRPORT WAY

GHD INC
PO BOX 54968
IRVINE, CA 92619-4921
For all inquiries regarding this license, contact HdL
Business Support Center at 707-302-6074.
"For Services Provided in the City of Vallejo, California Only"

IVER SKAVDAL

GHD INC
July 01, 2021
June 30, 2022
11702318
GHD INC :

Thank you for your payment on your City of Vallejo Business License. ALL LICENSES MUST BE AVAILABLE FOR INSPECTION UPON REQUEST. If you have questions concerning your business license, contact the Business Support Center via email at: [email protected] or by telephone at: (707) 302-6074.

Keep this portion for your license separate in case you need a replacement for any lost, stolen, or destroyed license. A fee may be charged for a replacement or duplicate license.

This certificate does not entitle the holder to conduct business before complying with all requirements of the Vallejo Municipal code and other applicable laws, nor to conduct business in a zone where conducting such business violates law.

If you have a fixed place of business within the City of Vallejo please display the Business License above in a conspicuous place at the premises. Otherwise, every Business License holder not having a fixed place of business in the City shall keep the Business License upon his or her person, or affixed in plain view any cart, vehicle, van or other movable structure or device at all times if required by the Collector.

Starting January 1, 2021, Assembly Bill 1607 requires the prevention of gender-based discrimination of business establishments. A full notice is available in English or other languages by going to: https://www.dca.ca.gov/publications/ City of Vallejo

BUSINESS LICENSE

BUSINESS LICENSING
8839 N CEDAR AVE #212
FRESNO, CA 93720-1832
Date of Issue: 07/01/2021
GHD INC License Number: 11702318
PO BOX 54968
IRVINE, CA 92619-4921

TO BE POSTED IN A CONSPICUOUS PLACE
AND
NOT TRANSFERABLE OR ASSIGNABLE.
2021 - 2022

MARGARET DEZURIK
TAX COLLECTOR’S OFFICE, City Hall, 555 Santa Clara St., Vallejo, CA. This certificate is evidence that the person (s), firm, or corporation named hereon has paid the tax required by Chapter 5.04 of the City of Vallejo Municipal Code for the type of business, the business address and for the period indicated hereon. This certificate is issued without verification that the taxpayer is subject to or exempted from licensing by local, state, Federal or other agencies. Issuance of this certificate is not an endorsement, nor a certificate of compliance with other ordinances or laws, nor an assurance that the proposed use is in conformance with the City ’s building / Fire / Zoning regulations.

Design Professional Services Agreement (Revised 01.2019) Page 1 of 11 Approved as to form:

By: for
Veronica Nebb, City Attorney

DESIGN PROFESSIONAL SERVICES AGREEMENT
This Design Professional Services Agreement ("Agreement") is made at Vallejo, California, dated for reference this 22nd day of March, 2022, by and between the City of Vallejo, a municipal corporation ("City"), and GHD, Inc., a California corporation, hereinafter referred to as Design Professional, who agree as follows:

1. Services. Subject to the terms and conditions set forth in this Agreement, Design Professional shall provide the City professional services as specified in Exhibit A, entitled “Scope of Work.”

2. Payment. City shall pay Design Professional for services rendered pursuant to this Agreement at the times and in the manner set forth in Exhibit B, entitled “Compensation.” The payments specified in Exhibit B shall be the only payments to be made to Design Professional for services rendered pursuant to this Agreement.

3. Facilities and Equipment. Design Professional shall, at its sole cost and expense, furnish all facilities and equipment which may be required for furnishing services pursuant to this Agreement.

4. Indemnification. To the fullest extent permitted by law, Design Professional shall hold harmless, defend (with independent counsel approved by City) and indemnify City and its officers, employees and volunteers from and against all claims, damages, losses, penalties, fines and judgments and expenses and defense costs, including but not limited to attorney fees, court costs, associated investigation and administrative expenses, regardless of the nature or type arising out of, or pertaining to, or relating to the negligence, recklessness, or willful misconduct of the Design Professional, or the acts or omissions of an employee, agent or subcontractor of the Design Professional, except where caused by the active negligence, sole negligence, or willful misconduct of City. In no event shall the cost to defend charged to the design professional exceed the design professional’s proportionate percentage of fault. However, notwithstanding the previous sentence, in the event one or more defendants is unable to pay its share of defense costs due to bankruptcy or dissolution of the business, the design professional shall meet and confer with other parties regarding unpaid defense costs. The provisions of this section pertaining to the duty and cost to defend shall not apply to either of the following: 1) Any contract for design professional services, or amendments thereto, where a project-specific general liability policy insures all project participants for general liability exposures on a primary basis and also covers all design professionals for their legal liability arising out of their Design Professional Services Agreement (Revised 01.2019) Page 2 of 11 professional services on a primary basis, 2) A design professional who is a party to a written design-build joint venture agreement.

The provisions of this Section are not limited by the insurance provisions of this Agreement.

The provisions of this section shall survive the completion of the services, expiration or termination of this Agreement.

5. Insurance Requirements. Design Professional agrees to comply with all of the Insurance Requirements set forth in Exhibit C, entitled “Insurance Requirements for Design Professional.” Failure to maintain required insurance at all times shall constitute a default and material breach.

6. Accident Reports. Design Professional shall immediately report (as soon as feasible, but not more than 24 hours) to the City Risk Manager any accident or other occurrence causing injury to persons or property during the performance of this Agreement. The report shall be made in writing and shall include, at a minimum: (a) the names, addresses, and telephone numbers of the persons involved, (b) the names, addresses and telephone numbers of any known witnesses, (c) the date, time and description of the accident or other occurrence.

7. Conflict of Interest. Design Professional warrants and represents that to the best of its knowledge, there exists no actual or potential conflict between Design Professional’s family, business, real property or financial interests and the services to be provided under this Agreement. Design Professional shall comply with the City of Vallejo Conflict of Interest Code and not enter into any contract or agreement during the performance of this Agreement which will create a conflict of interest with its duties to City under this Agreement. In the event of a change in Design Professional’s family, business, real property, or financial interests occurs during the term of this Agreement that creates an actual or potential conflict of interest, then Design Professional shall disclose such conflict in writing to City.

Every individual who performs services on behalf of Design Professional pursuant to this Agreement must file a full Statement of Economic Interests (also known as Form 700) with the City Clerk if the work of the individual involves making a governmental decision whether to issue, deny, suspend, or revoke any permit, license, application, certificate, approval, order, or similar authorization or entitlement; authorizes the City to enter into, modify, or renew a contract; grants City approval of specifications for a contract; adopts or approves for the City any policy, standard or guideline; lobbies on behalf of the City, or performs the same or substantially all the same duties for the City that would otherwise be performed by an individual holding a position specified in the City’s Conflict of Interest Code.

8. Independent Contractor. Design Professional is an independent contractor. Neither Design Professional nor any of Design Professional’s officers, employees, agents or subcontractors, if any, is an employee of City by virtue of this Agreement or performance of any services pursuant to this Agreement. City Design Professional Services Agreement (Revised 01.2019) Page 3 of 11 shall have the right to control Design Professional only insofar as the results of Design Professional’s services rendered pursuant to this Agreement; however, City shall not have the right to control the means by which Design Professional accomplishes services pursuant to this Agreement.

9. Licences, Permits, Etc. Design Professional represents and warrants to City that all design professional services shall be provided by a person or persons duly licensed by the State of California to provide the type of services to be performed under this Agreement and that Design Professional has all the permits, qualifications and approvals of whatsoever nature which are legally required for Design Professional to practice its profession. Design Professional represents and warrants to City that it shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement any licenses, permits, and approvals which are legally required for Design Professional to practice its profession.

10. Business License. Design Professional and its subcontractors, has obtained or agrees to apply prior to performing any services under this Agreement to City’s Finance Department for a business license, pay the applicable business license tax and maintain said business license during the term of this Agreement.

The failure to obtain such license shall be a material breach of this Agreement and grounds for termination by City. No payments shall be made to Design Professional until such business license(s) has been obtained.

11. Standard of Performance. Design Professional shall provide products and perform all services required pursuant to this Agreement in accordance with generally accepted professional practices and principles and in a manner consistent with the level of care and skill ordinarily exercised under similar conditions by members of Design Professional’s profession currently practicing in California.

Design Professional is responsible for making an independent evaluation and judgment of all conditions affecting performance of the work, including without limitation site conditions, as well as all areas appurtenant to the site, existing facilities, seismic, geologic, soils, hydrologic, geographic, climatic conditions, applicable federal, state, and local laws and regulations, and all other contingencies or design considerations. Data, calculations, opinions, reports, investigations, and other similar information provided by City relating to site, local, or other conditions is not warranted or guaranteed, either expressly or implied, by City.

Design Professional’s responsibilities under this section shall not be delegated.

Design Professional shall be responsible to City for acts, errors, or omissions of Design Professional’s subcontractors.

Design Professional shall prepare plans, specifications, reports, and/or other work products in such a way that amendments or change orders to the agreement between City and its construction contractor will not be necessary, except for Design Professional Services Agreement (Revised 01.2019) Page 4 of 11 unforeseeable circumstances. As used herein, “unforeseeable circumstances” shall mean facts or inferences from those facts that could not be ascertained by a combination of reasonable site inspection during the preparation of the plans and specifications by Design Professional and the reasonable application to such inspection of expertise consistent with the level of care and skill ordinarily exercised under similar conditions by a members of Design Professional‘s profession currently practicing in California.

Whenever the scope of work requires or permits review, approval, conditional approval or disapproval by City, it is understood that such review, approval, conditional approval or disapproval is solely for the purposes of administering this Agreement and determining whether the Design Professional is entitled to payment for such work, and not be construed as a waiver of any breach or acceptance by the City of any responsibility, professional or otherwise, for the work, and shall not relieve the Design Professional of responsibility for complying with the standard of performance or laws, regulations, industry standards, or from liability for damages caused by negligent acts, errors, omissions, noncompliance with industry standards, or the willful misconduct of Design Professional.

12. Force Majeure. Neither party shall be considered in default of this Agreement to the extent performances are prevented or delayed by any cause, or circumstances beyond either party’s reasonable control, such as war, riots, strikes, lockouts, work slowdown or stoppage, acts of God, such as floods or earthquakes, and electrical blackouts or brownouts.

In the event that the Design Professional is unable to meet the completion date or schedule of services, Design Professional shall immediately inform the City Representative of this in writing. If additional time is required to perform the work, the City Representative may adjust the schedule.

13. Time is of the Essence. Time is of the essence in this Agreement. Any reference to days means calendar days, unless otherwise specifically stated.

14. Personnel. Design Professional agrees to assign only competent personnel according to the reasonable and customary standards of training and experience in the relevant field to perform services under this Agreement. Failure to assign such competent personnel shall constitute grounds for termination of this Agreement.

The payment made to Design Professional pursuant to this Agreement shall be the full and complete compensation to which Design Professional and Design Professional’s officers, employees, agents, and subcontractors are entitled for performance of any work under this Agreement. Neither Design Professional nor Design Professional’s officers or employees are entitled to any salary or wages, or retirement, health, leave or other fringe benefits applicable to employees of the City. The City will not make any federal or state tax withholdings on behalf of Design Professional Services Agreement (Revised 01.2019) Page 5 of 11 Design Professional. The City shall not be required to pay any workers' compensation insurance on behalf of Design Professional.

Design Professional shall pay, when and as due, any and all taxes incurred as a result of Design Professional’s compensation hereunder, including estimated taxes, and shall provide City with proof of such payments upon request.

Design Professional shall comply with all provisions of California laws dealing with prevailing wages, apprentices, and hours of work. Design Professional shall also comply with provisions of Labor Code section 1720 as applicable. A copy of the prevailing wage rates is available for review upon request by Design Professional to the City Representative. This provision applies only to the following portions of the scope of work:

15. Design Professional Not Agent. Except as authorized under this Agreement or as City may authorize in a letter of authorization signed by the City Manager or his or her designee, Design Professional shall have no authority, express or implied to act on behalf of City in any capacity whatsoever as an agent.

Design Professional shall have no authority, express or implied, under this Agreement, to bind City to any obligation whatsoever.

16. Term. The term of this Agreement shall commence on March 8, 2022, and shall continue in full force and effect until June 30, 2026.

City shall, at its discretion, have the right to extend the term of this Agreement, in intervals of one year, by written notice to Design Professional. The total duration of this Agreement, including the exercise of any options under this section, shall not exceed June 30, 2027.

If the term of this Agreement extends into fiscal years subsequent to that in which it is approved, such continuation of the Agreement is contingent on the appropriation of funds for such purpose by the City Council of the City of Vallejo.

If funds to effect such continued payment are not appropriated, Design Professional agrees to terminate any services supplied to City of Vallejo under this Agreement, and relieve City of any further obligation therefore.

17. Termination or Abandonment by City. The City has the right, at any time and in its sole discretion, to immediately terminate or abandon any portion or all of the services to be provided under this Agreement by giving notice to Design Professional. Upon receipt of a notice of termination, Design Professional shall perform no further work except as specified in the notice. Before the date of termination, Design Professional shall deliver to City all City records and documents, all work products, whether completed or not, as of the date of termination and not otherwise previously delivered.

The City shall pay Design Professional for services performed in accordance with this Agreement before the date of termination. If this contract provides for payment Design Professional Services Agreement (Revised 01.2019) Page 6 of 11 of a lump sum for all services or by task and termination occurs before completion of the work or any defined task which according to the performance schedule was commenced before the notice of termination, the fee for services performed shall be based on an amount mutually agreed to by City and Design Professional for the portion of work completed in conformance with this Agreement before the date of termination. In addition, the City will reimburse Design Professional for authorized expenses incurred and not previously reimbursed. The City shall not be liable for any fees or costs associated for the termination or abandonment except for the fees, and reimbursement of authorized expenses, payable pursuant to this section.

18. Products of Consulting Services. The work product, including without limitation, all writings, work sheets, reports, recordings, drawings, files, detailed calculations and other work products, whether complete or incomplete, of Design Professional resulting from services rendered pursuant to this Agreement, shall become the property of City. Design Professional agrees that all copyrights which arise from creation of the work under this Agreement shall be vested in the City and waives and relinquishes all claims to copyright or other intellectual property rights in favor of the City. City acknowledges that its use of the work product is limited to the purposes contemplated by the scope of work and that the Design Professional makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the scope of work.

Documents submitted to the City in electronic format shall be formatted according to specifications provided by the City, or if not otherwise specified, in Microsoft Word, Excel, PowerPoint or other Microsoft Office Suite (2002) format as appropriate for the particular work product or, if directed by the City Representative in Adobe Acrobat PDF format.

19. Cooperation by City. City shall, to the extent reasonable and practicable, assist and cooperate with Design Professional in the performance of Design Professional’s services hereunder.

20. Assignment and Subcontracting. Design Professional shall not subcontract, assign or transfer voluntarily or involuntarily any of its rights, duties or obligation under this Agreement without the express written consent of the City Manager or his or her designee in each instance. Any attempted or purported assignment of any right, duty or obligation under this Agreement without City’s consent shall be void and of no effect.

If subcontracting of work is permitted, Design Professional shall pay its subcontractor within ten (10) days of receipt of payment by City for work performed by a subcontractor and billed by the Design Professional. Use of the term subcontractor in any other provision of this contract shall not be construed to imply authorization for Design Professional to use subcontractors for performance of any service under this Agreement.

Design Professional Services Agreement (Revised 01.2019) Page 7 of 11 The City is an intended beneficiary of any work performed by Design Professional’s subcontractor for purposes of establishing a duty of care between the subcontractor and City.

21. Successors and Assigns. All terms, conditions, and provisions of this Agreement shall apply to and bind the respective heirs, executors, administrators, successors, and assigns of the parties. Nothing in this section is intended to affect the limitation on assignment.

22. Non-Discrimination/Fair Employment Practices.
(a) Design Professional shall not, because of race, religious creed, color, sex, national original, ancestry, disability, medical condition, age, marital status or sexual orientation of any person, refuse to hire or employ, or to bar or discharge from employment, or to discriminate in compensation, or in terms, conditions or privileges any person, and every employee will receive equal opportunity for employment and shall be granted equal treatment with respect to compensation, terms, conditions or other privileges of employment, without regard to his race, religious creed, color, sex, national origin or ancestry.

Design Professional warrants and represents it is an equal opportunity employer and agrees it shall not discriminate on the basis of race, religious creed, color, sex, national origin, ancestry, disability, medical condition, age, marital status or sexual orientation in the selection and retention of employees, subcontractors or procurement of materials or equipment.

In all solicitations either by competitive bidding or negotiations made by Design Professional for work to be performed under any subcontract, including procurement of materials or equipment, each potential subcontractor or supplier shall be notified by Design Professional of Design Professional’s obligation under this Agreement relative to nondiscrimination and fair employment practices.

Design Professional shall include the above provisions of this section in every subcontract, including procurement of materials or equipment. (b) Design Professional agrees to comply with Title VII of the Civil Rights Act of 1964, as amended, the California Fair Employment Practices Act, the Americans with Disabilities Act of 1990, any other applicable federal and state laws and regulations and City ordinances and regulations hereinafter enacted.

23. Notices. All notices or instruments required to be given or delivered by law or this Agreement shall be in writing and shall be effective upon receipt thereof and shall be by personal service or delivered by depositing the same in any United States Post Office, registered or certified mail, postage prepaid, addressed to:

Design Professional Services Agreement (Revised 01.2019) Page 8 of 11 If to City: Beth Schoenberger, Acting Water Director
City of Vallejo, Water Department
202 Fleming Hill Road
Vallejo, CA 94589
If to Design Professional: Alex Culick, Project Management Lead/Principal GHD, Inc.
655 Montgomery Street, Suite 1010
San Francisco, CA 94111
Any party may change its address for receiving notices by giving written notice of such change to the other party in accordance with this section.

Routine administrative communications shall be made pursuant to section 1 of Exhibit A.

24. Integration Clause. This Agreement, including all Exhibits, contains the entire agreement between the parties and supersedes whatever oral or written understanding they may have had prior to the execution of this Agreement. This Agreement shall not be amended or modified except by a written agreement executed by each of the parties hereto.

25. Severability Clause. Should any provision of this Agreement ever be deemed to be legally void or unenforceable, all remaining provisions shall survive and be enforceable.

26. Law Governing. This Agreement shall in all respects be governed by the law of the State of California, without regard to its conflicts of law rules. Litigation arising out of or connected with this Agreement shall be instituted and maintained in the courts of Solano County in the State of California or in the United States District Court, Eastern District of California, Sacramento, California, and the parties consent to jurisdiction over their person and over the subject matter of any such litigation in such courts, and consent to service of process issued by such courts.

27. Waiver. Waiver by either party of any default, breach or condition precedent shall not be construed as a waiver of any other default, breach or condition precedent or any other right hereunder.

28. Ambiguity. The parties acknowledge that this is a negotiated agreement, that they have had the opportunity to have this Agreement reviewed by their respective legal counsel, and that the terms and conditions of this Agreement are not to be construed against any party on the basis of such party's draftsmanship thereof.

29. Gender. All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, neuter, singular or plural, as the identifications of the person or persons, firm or firms, corporation or corporations may require.

Design Professional Services Agreement (Revised 01.2019) Page 9 of 11

30. Headings. The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

31. Compliance with Laws. Design Professional will comply with all statutes, regulations and ordinances in the performance of all services under this Agreement.

32. Confidentiality of City Information. During the performance of services under this Agreement, Design Professional may gain access to and use City information regarding, but not limited to, procedures, policies, training, operational practices, and other vital information (hereafter collectively referred to as "City Information") which are valuable, special and unique assets of the City. Design Professional agrees that it will not use any information obtained as a consequence of the performance of services under this Agreement for any purpose other than fulfillment of Design Professional’s scope of work , to protect all City Information and treat it as strictly confidential and proprietary to City, and that it will not at any time, either directly or indirectly, divulge, disclose or communicate in any manner any City Information to any third party, other than its own employees, agents or subcontractors who have a need for the City Information for the performance of services under this Agreement, without the prior written consent of City, or as required by law.

Design Professional shall treat all records and work product prepared or maintained by Design Professional in the performance of this Agreement as confidential.

A violation by Design Professional of this section shall be a material violation of this Agreement and will justify legal and/or equitable relief.

Design Professional’s obligations under this section shall survive the completion of services, expiration or termination of this Agreement.

33. News and Information Release. Design Professional agrees that it will not issue any news releases in connection with either the award of this Agreement, or any subsequent amendment of or efforts under this Agreement, without first obtaining review and approval of said news releases from City through the City Representative.

34. City Representative. The City Representative specified in Exhibit A, or the representative's designee, shall administer this Agreement for the City.

35. Counterparts. The parties may execute this Agreement in one or more counterparts, each of which shall be deemed an original, but all of which together shall be deemed one and the same instrument.

Design Professional Services Agreement (Revised 01.2019) Page 10 of 11

36. Facsimile Signature; Electronic Signature. This Agreement shall be binding upon the receipt of facsimile signatures or emailed by PDF or otherwise.

Any person transmitting his or her signature by facsimile or electronically shall promptly send an original signature to the other party pursuant to the notice provision of this Agreement. The failure to send an original shall not affect the binding nature of this Agreement.

37. Authority. The person signing this Agreement for Design Professional hereby represents and warrants that he/she is fully authorized to sign this Agreement on behalf of Design Professional.

38. Exhibits. The following exhibits are attached hereto and incorporated herein by reference:

Exhibit A, entitled “Scope of Work,” including any attachments Exhibit B, entitled “Compensation,” including any attachments Exhibit C, entitled “Insurance Requirements,” including attachments [SIGNATURES ON FOLLOWING PAGE]
Design Professional Services Agreement (Revised 01.2019) Page 11 of 11 IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year shown below the name of each of the parties.

GHD, Inc.,
a California corporation
By:

Alex Culick
Project Management Lead / Principal
DATE:
(City Seal)

CITY OF VALLEJO,
a municipal corporation
By:

MIKE MALONE
Interim City Manager
DATE:

ATTEST:

By:

Dawn Abrahamson
City Clerk
APPROVED AS TO CONTENT:

Beth Schoenberger
Acting Water Director
APPROVED AS TO FORM:

For
Veronica A. F. Nebb
City Attorney
APPROVED AS TO INSURANCE:

Armond Sarkis
Risk Manager
Design Professional Services Agreement (Revised 01.2019) Page 1 of 2 Exhibit A

SCOPE OF WORK

1. Representatives.

The City Representative for this Agreement is:

Matt Brown, P.E., Senior Engineer
Water Department, City of Vallejo
202 Fleming Hill Road
Vallejo, CA 94589
[email protected]
The Design Professional’s Representative for this Agreement is:

Alex Culick, Project Management Lead/Principal
GHD, Inc.
655 Montgomery Street, Suite 1010
San Francisco, CA 94111
[email protected]
All routine administrative communications between the parties will be between the above-named representatives and may be by personal delivery, mail, or electronic mail as agreed between the Design Professional Representative and City’s Representative.

2. Services to be Provided. The Design Professional will provide as-needed services for City of Vallejo Water Department projects as assigned by Water Department staff, in written Statements of Work, executed by Design Professional before commencement of work on the project. At the discretion of Water Department staff, and considering the capabilities of Design Professional, assignments shall be given to Design Professional in Pipelines; Pump Stations and Tanks; Water Treatment Plants; and Electrical Engineering, as more fully set forth in Attachment 1 to Exhibit A, which is incorporated herein by this reference.

City shall have no obligation to pay Design Professional for any work performed by Design Professional that is not set forth in this Agreement or in a Statement of Work.

3. Time for Performance. Design Professional will perform services according to the schedule negotiated for each Statement of Work. If the schedule calls for the services to be performed in phases or discrete increments, Design Professional shall not proceed from one phase or increment to the next without written authorization from the City’s Representative. Design Professional will complete all services for any Statement of Work by the agreed upon date set forth in the Statement of Work.

4. Key Personnel. All of the individuals identified below are necessary for the successful prosecution of the services due to their unique expertise and depth and Design Professional Services Agreement (Revised 01.2019) Page 2 of 2 Exhibit A
breadth of experience. There shall be no change in the personnel listed below, without written approval of the City Representative. Design Professional recognizes that the composition of this team was instrumental in the City’s decision to award the work to Design Professional and that compelling reasons for substituting these individuals must be demonstrated for the City’s consent to be granted. Any substitutes shall be persons of comparable or superior expertise and experience. Failure to comply with the provisions of this section shall constitute a material breach of Design Professional’s obligations under this Agreement and shall be grounds for termination.

Key personnel will be as identified in individual Statements of Work.

In mid-2021, the City expects to begin executing a prioritized list of projects identified in its Capital Improvement Program (CIP) that will require immediate resources using several On-call Consultants. These projects will be varied and will require consulting firms with diverse and specialized skill sets. Other services, such as conceptual-level studies, may be needed to support executable design of the CIP. The anticipated service categories are listed below.

1. PROGRAM/PROJECT MANAGEMENT
Consultant will serve as an extension of staff and may provide overall program and project management for projects. Familiarity with Caltrans Projects and their Right of Way (ROW) Manual may be beneficial. The Consultant will schedule and conduct remote project meetings with staff and may be required to work at least two (2) days a week in the Water Department Engineering office located at 202 Fleming Hill Road, Vallejo, California, under COVID-19 provisions for Solano County.

Potential projects include:
• Overseeing another consultant preparing the design of a large diameter pipeline in an area outside the City requiring coordination with Napa County. • Review of developer plans as part of the developer review process. • Assistance with developing project schedules and budgeting for CIP projects.
• Assist with the planning and implementation of a Water Exchange Policy and/or water supply agreements with neighboring municipalities. • Managing implementation of replacement of water meters across the service area.
• Management and tracking expenditures for numerous on-call consulting and contractor contracts.

2. PIPELINES
Consultant will have demonstrated capability and experience in design of new pipelines, which may include alignment studies, profile and plan drawings, hydraulic gradient drawings, selection and sizing of pipe, linings, coatings, fittings, valves, blow off vaults, air release vaults, corrosion protection methods, startup and shut down procedures, and trenchless installation methods including sliplining. Familiarity with Caltrans Projects and their Right of Way (ROW) Manual may be beneficial.

Potential projects include:
• Design of a large diameter raw water pipeline in an area outside the City requiring coordination with Napa County.

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ATTACHMENT 1 TO EXHIBIT A
• Design of the City's annual distribution main replacement projects. • Development of a water main prioritization list based on leak data, pipe characteristics and the City's pavement program.
• Design of the slip-lining of a 24-inch pipe with a 10-inch pipe within a Caltrans right-of-way.
• Management of potholing to locate utilities for a pipeline design project.

3. PUMP STATIONS AND TANKS
Consultant will have demonstrated capability and experience in performing feasibility studies, condition assessments, and design for upgrading existing and designing new pump stations and tanks. Tasks may include pump/motor sizing and selection, pipe sizing, hydraulic surge analysis, selection and sizing of valves, instrumentation and controls, pipe supports, site studies, electrical power requirements, etc.

Potential projects include:
• Design of a new pump station to replace a below-grade pump station in a busy street.
• Condition assessment of a hydropneumatic pump station and tank, and preparation of a report with recommended upgrades.
• Design of a series of 5-6 MG tanks to replace a 37 MG concrete lined reservoir.
• Preparation of specifications and obtaining quotes to replace pumps in kind at a pump station.
• The design and implementation of SCADA upgrades and integration with existing SCADA network.

4. WATER TREATMENT PLANTS
Consultant will have demonstrated capability and experience in water treatment plant processes and facilities. Consultant may perform feasibility studies, preliminary design, detailed design, and startup services for new or upgraded water treatment facilities; perform comparative analysis of treatment methods, including operational impacts, initial cost, life cycle cost, effectiveness of meeting treatment goals; plant siting studies; plant hydraulics; Supervisory Control and Data Acquisition (SCADA) requirements; and other requirements. Consultant may assist the Water Department in interactions and negotiations with the Department of Drinking Water (DDW) regarding design review and permit revisions for new or upgraded treatment facilities.

Consultant may be required to optimize existing water treatment plant processes, review standard operating procedures, and recommend changes, evaluate process/equipment requirements ahead of water source/quality changes, be V:\OWater\On-Call Consulting.Docx
familiar with existing and proposed water quality regulations and understand the impacts to the treatment plant processes.

Potential upcoming projects include:
• Design of a new 5 MGD water treatment plant featuring ozone, plate settling actiflow or Ml EX technologies.
• Design of replacement of flocculation and sedimentation equipment. • Condition assessment and design of the rehabilitation of chemical feed systems.
• The design and implementation of SCADA upgrades and integration with existing SCADA network.

5. EARTHEN DAMS AND ASSOCIATED GEOTECHNICAL AND STRUCTURAL

ENGINEERING
Consultant will have demonstrated capability and experience studying and designing improvements for earthen dams and their associated infrastructure such as spillways, fish releases and outlets. Consultant may be required to inspect dams and all appurtenant structures, including spillways and outlet towers, and be capable of evaluating deficiencies and the degree of hazard associates with the deficiencies, and to provide demonstrated experience in designing repairs to address such deficiencies. Consultant will demonstrate experience in the permitting and construction of dams, as well as the demolition of dams and/or related structures, and the development, design, and operation of pumped storage systems. Consultant will have experience with the regulatory agencies that govern dams, particularly the DSOD.

Consultant may perform geotechnical studies, as needed, to support other elements of the CIP (e.g., seismic evaluation or pipeline alignments).

Consultant may perform site investigations to gather data, take samples and measurements, and generally collect the information necessary to perform a structural analysis and evaluation of concrete foundations, tank and reservoir walls, pipe penetrations, all types of pipe, equipment supports, including the analysis of induced vibrations; perform the seismic analysis of such structures, including dams and related structures/appurtenances. Consultant will be capable of performing structural design for upgraded dam facilities.

Potential upcoming projects include:
• Alternatives analysis and cost estimates for raising an earthen dam. • Design of a new concrete lined spillway.
• Assessment and seismic upgrade design for an earthen dam. • Development of a program for landslide monitoring.
• Geotechnical study for a new water tank.

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6. HYDROLOGY EVALUATIONS
Consultant will have demonstrated past successful experience in performing hydrologic evaluations, primarily to support the DOSD permitting and compliance.

Potential projects include:
• Preparation of inundation studies.
• Spillway modeling and sizing.
• Bathymetric studies to assess the available storage in a reservoir (lake) under different climactic conditions.

7. WATER DISTRIBUTION SYSTEM HYDRAULIC MODELING
Consultant will have successful experience in development and use of hydraulic models of water distribution systems. The City anticipates updating and converting our Geographic Information System (GIS) into a new hydraulic model. The new model will need to be calibrated and used to develop a new Water Master Plan as well as run various theoretical scenarios as part of the planning process for various projects.

Consultant will be capable of analyzing hydraulic systems such as transmission pipelines (i.e., raw water pipelines); treated water distribution systems such as pressure zones with pressure regulating valves, pump stations, tanks, and hydropneumatic zones; pump suction and discharge piping, treatment plant filter gallery piping, treatment plant hydraulics, and may prepare reports as needed to summarize and make recommendations. Consultant will have experience preparing master plans and capital improvement plans (annual budgeting) based on the hydraulic model output for water systems of a similar size.

Potential projects include:
• Fixing connectivity issues of the pipeline network in GIS and assessing SCADA data for importing into a hydraulic model.

Creation of a new hydraulic model for the City system.

Extended period Simulation (EPS) and static calibration of a hydraulic model
Performing fire flow testing.

Using the hydraulic model to prepare a Water Master Plan with recommended pipeline, pressure zone, and storage improvements.

Assessment of the sizing of new facilities (pipes, tanks, pump stations) to connect a new development to the system.

Assessment of downsizing a 37 MG reservoir to a series of 5-6 MG reservoirs.

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8. ELECTRICAL ENGINEERING
Consultant will be experienced in the design of both high and low voltage electrical power systems for water pump stations, water treatment plants; design of stationary and portable electric generator connections, integration of new equipment with existing facilities, work with PG&E on the City's behalf to prepare applications for new service, review code requirements as applicable, perform arc flash studies, develop single-line diagrams and other drawings as needed. Perform on-site startup activities, including oversight of functional and performance testing.

Potential projects include:

Arc flash studies at all the City's pump stations.

Assessment and replacement of constant speed drives with variable speed drives.

Condition assessments of electrical equipment at a water treatment plant.

Design of a permanent backup generator for a 10 MOD pump station.

Condition assessment, bidding and construction oversight of safety upgrades to a high voltage substation.

The design and implementation of remote operation and monitoring equipment and control protocols for existing valves.

Renovation of existing and design and install of new solar powered equipment.

Provide resiliency studies of existing facilities and to provide recommendations and design projects to enable continued operations during PSPS events.

9. WATER RESOURCES MANAGMENT
Consultant will have past successful experience in performing water resources management including evaluations to demonstrate available water supplies are sufficient to support proposed new developments or respond to drought conditions.

Consultant will be familiar with the North Bay Aqueduct and other state and federal water supplies and water rights, climate change impact projections, water demand projections, urban water management planning (UWMP), water exchange policy development, and water conservation.

Potential projects include:
• Preparation of a water supply assessment for a new residential development.
• Development of a water supply model to understand projected water supplies from the City's numerous water supply sources. • Develop and implement a sustainable water exchange policy during drought conditions.
• Prepare public outreach for drought policy measures.

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• Coordinate with Regional, State and Federal Regulatory Agencies. • Update to an UWMP.

10. ENVIRONMENTAL PERMITTING, CEQA AND RESTORATION
Consultant will provide demonstrated experience in all aspects of environmental requirements, including National Pollutant Discharge Elimination System (NPDES) requirements. Storm Water Pollution Prevention (SWPP) requirements, environmental permits and the Califomia Environmental Quality Act (CEQA).

Consultant may be required to determine how environmental and CEQA permitting affect projects at each stage and provide guidance and recommendations for balancing design options with any and all regulatory agencies that may have purview over them. Consultant may perform biology, habitat/vegetation and wildlife studies. Consultant may be asked to design creek, habitat or landscape restoration.

Potential projects include:
• CEQA compliance, permitting and restoration for a dam upgrade project. • CEQA compliance, permitting and landscape design for the abandonment of a 16 MG reservoir in a residential neighborhood.
• CEQA compliance and permitting for a new pipeline crossing a creek.

11. CONSTRUCTION MANAGEMENT
Consultant will be competent in the provision of construction management services including conducting meetings, coordinating with design professionals and City staff, managing documentation, managing schedules, performing daily field inspections, and managing conflict resolution. Consultant will be expected to review contractor prevailing wage statements for compliance with Department of Industrial Relations (DIR) requirements. Materials testing is to be performed by others.

Potential projects include:
• Construction management for a new water tank or pump station. • Review of prevailing wage statements for the City's annual main replacement program.
• Construction management for construction of a new dam spillway. • Construction management of raw water transmission line replacements. • Construction management of treatment plant upgrades for flocculation, filter media, ozone generation, chemical storage facilities, and solar power upgrades.

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12. TELECOMMUNICATION SERVICES
Consultant will perform analysis of antenna, microwave and communication systems and provide analysis of radiation patterns, antenna gain and efficiency for communication systems and integration of AMI metering devices for data collection and billing applications. Consultant will also provide analysis for communication tower design including monopole solutions for communication of data between facilities.

V:\OWater\On-Call Consulting.Docx 13
Design Professional Services Agreement (Revised 01.2019) Page 1 of 3 Exhibit B

EXHIBIT B

COMPENSATION

1. Design Professional’s Compensation.

A. Services: City agrees to pay Design Professional, at the rate(s) specified below, for those services set forth in Exhibit A of this Agreement and for all authorized reimbursable expenses, for a total not to exceed Two Million Dollars and 00 Cents as set forth below:

FISCAL YEAR NOT TO EXCEED AMOUNT
FY22 $500,000
FY23 $500,000
FY24 $500,000
FY25 $500,000
Design Professional shall notify City in writing no later than thirty (30) days prior to the estimated date when Design Professional will have billed City the maximum payment amount permitted under this Agreement, and Design Professional shall provide City with an estimate of the additional compensation required to complete the project.

City agrees to pay Design Professional for those services set forth in Exhibit A of this Agreement (identified by Statements of Work) and for all authorized reimbursable expenses upon satisfactory completion of the services and delivery of the work product.

B. Additional Services:

1. Additional Services are those services related to the scope of Services of Design Professional as set forth in Exhibit A but not anticipated at the time of execution of this Agreement. Additional Services shall be provided only when a Supplemental Agreement authorizing such Additional Services is approved by the City Manager, or his or her designee. City reserves the right to perform any Additional Services with its own staff or to retain other Design Professionals to perform said Additional Services.

2. Design Professional’s compensation for Additional Services shall be based on the total number of hours spent on Additional Services multiplied by the employees' appropriate billable hourly rate as established below. City, at its option, may negotiate a fixed fee for some or all Additional Services as the need arises.

Where a fixed fee for Additional Services is established by mutual Agreement between City and Design Professional, compensation to Design Professional shall not exceed the fixed fee amount.

Design Professional Services Agreement (Revised 01.2019) Page 2 of 3 Exhibit B

2. Appropriate Billable Hourly Rates for Services and Additional Services. Design Professional’s billable hourly rates shall be as listed in Attachment 1 of Exhibit B, attached hereto and incorporated herein by this reference.

3. Design Professional’s Reimbursable Expenses. Reimbursable Expenses shall be limited to actual reasonable expenditures of Design Professional for expenses that are necessary for the proper completion of the Services and shall only be payable if specifically authorized in writing in advance by City.

4. Payments to Design Professional.

A. Payments to Design Professional shall be made within a reasonable time after receipt of Design Professional’s invoice, said payments to be made in proportion to services performed. Design Professional may request payment on a monthly basis. Design Professional shall be responsible for the cost of supplying all documentation necessary to verify the monthly billings to the satisfaction of City.

B. All invoices submitted by Design Professional shall be (1) billed on a monthto-month basis (i.e., the first of the month through the end of the month), (2) submitted by email to [email protected], and (3) must contain the following information:

1. Description of services billed under the invoice

2. Date of Invoice Issuance

3. Sequential Invoice Number

4. City’s Purchase Order Number

5. Statement of Work Number

6. Social Security Number or Taxpayer Identification Number

7. Amount of the Invoice (Itemize all Reimbursable Expenses)

8. Total Billed to Date
C. Items shall be separated into Services and Reimbursable Expenses.

Billings that do not conform to the format outlined above shall be returned to Design Professional for correction. City shall not be responsible for delays in payment to Design Professional resulting from Design Professional’s failure to comply with the invoice format described above.

D. Request for payment shall be sent to:

Matt Brown, P.E., Senior Engineer
Engineering Division
City of Vallejo Water Department
c/o [email protected]
Design Professional Services Agreement (Revised 01.2019) Page 3 of 3 Exhibit B

5. Accounting Records of Design Professional. Design Professional shall maintain for three (3) years after completion of all services hereunder, all records under this Agreement, including, but not limited to, records of Design Professional’s direct salary costs for all Services and Additional Services performed under this Agreement and records of Design Professional’s Reimbursable Expenses, in accordance with generally accepted accounting practices. Design Professional shall keep such records available for audit, inspection and copying by representatives of the City’s Finance Department or other government agencies during regular business hours upon twenty four (24) hours notice.

The obligations of Design Professional under this section shall survive this Agreement.

6. Taxes. Design Professional shall pay, when and as due, any and all taxes incurred as a result of Design Professional’s compensation hereunder, including estimated taxes, and shall provide City with proof of such payments upon request.

7. Taxpayer Identification Number. Design Professional shall provide City with Design Professional’s complete Request for Taxpayer Identification Number and Certification, Form W-9, as issued by the Internal Revenue Service, and any other State or local tax identification number requested by City.

Rate Rate
A01 Senior Technical Director 1 $280 C03 Senior Admin Officer 1 $155 A02 Senior Technical Director 2 $260 C04 Senior Admin Officer 2 $125 A03 Senior Technical Director 3 $240 C05 Admin Officer 1 $105 A04 Technical Director 1 $225 C06 Admin Officer 2 $90
A05 Technical Director 2 $200 C07 Admin Officer 3 $75
A06 Senior Professional 1 $175 D01 Business Services Manager 1 $275 A07 Senior Professional 2 $160 D02 Business Services Manager 2 $255 A08 Professional 1 $140 D03 Senior Admin Officer 1 $215 A09 Professional 2 $125 D04 Senior Admin Officer 2 $170 A10 Professional 3 $115 D05 Admin Officer 1 $155
A11 Intern $85 D06 Admin Officer 2 $110
B01 Lead Design Technician 1 $255 D07 Admin Officer 3 $100 B02 Lead Design Technician 2 $230 D08 Admin Officer 4 $90 B03 Lead Design Technician 3 $210 D09 Admin Officer 5 $85 B04 Senior Design Technician 1 $170 D10 Admin Officer 6 $75 B05 Senior Design Technician 2 $160 S01 Senior Construction Manager $250 B06 Design Technician 1 $150 S02 Construction Manager $205 B07 Design Technician 2 $135 S03 Lead Site Engineer/Supervisor $175 B08 Drafting/Design 1 $125 S06 Lead Inspector $165
B09 Drafting/Design 2 $115 S07 Senior Inspector $150
B10 Drafting/Design 3 $105 S08 Inspector / Specialist 1 $135 B11 Drafting/Design 4 $95 S09 Inspector / Specialist 2 $110 B12 Intern Drafting/Design $85 S10 Clerk / Specialist 3 $80 C01 Business Services Manager 1 $250 S15 Operator/Laborer 1 $125 C02 Business Services Manager 2 $210 S16 Operator/Laborer 2 $105 S17 Operator/Laborer 3 $95
1 2
3 4
5 6
7 8
Reimbursement for direct expenses incurred for proposed services, including sub-consultant services, will be billed at cost plus 15%
FY 2022 US West Region Rate Schedule
Finance Class Code Finance Class Code
Rates are for employees of all GHD companies.

All travel cost will be invoiced at coach class rates. Lodging and meal expenses will be at cost unless per diem rate is negotiated.

GHD has implemented a system of billing for consumables on a per hour basis. Associated Project Cost (APC) is a unit cost replacing the individual tracking of some of the consumable costs directly related to projects.

Each year the total consumable audited costs are compiled from our general ledger including:

Reimbursement for vehicles used for proposed services will be at the federally approved mileage rates or at a negotiated monthly rate.

Overtime for non-exempt employees will be charged at 1.5 times the hourly billing rate.

If prevailing wage are applicable, the above billing rates and APC will be adjusted proportionate to the increase in labor cost
The Rate Schedule is subject to change annually.
- Office consumables including engineering supplies and postage - Reproduction consumable costs including equipment lease and maintenance, printing, and stationary - Communication consumables including telephone expenses - Equipment consumable including CADD, software, and IT expenses Associated project cost (APC) will be invoiced at the following rate:
b. Field Services/Construction Inspector APC: $11.50 / labor hour a. General Associated Project Charges APC: $6.50 / labor hour or 4% of labor costs → 3. Fee Schedule
GHD City of Vallejo On-Call Water Engineering Consulting 7 ATTACHMENT 1 TO EXHBIT B
Design Professional Services Agreement (Revised 01.2019) Page 1 of 4 Exhibit C

EXHIBIT C

INSURANCE REQUIREMENTS
Design Professional shall procure and maintain for the duration of this Agreement, including any extensions thereto, insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of services hereunder by the Design Professional, their agents, representatives, or employees or subcontractors. It shall be a requirement under this Agreement that any available insurance proceeds broader than or in excess of the specified minimum Insurance coverage requirements and/or limits shall be available to the Additional Insured. Furthermore, the requirements for coverage and limits shall be (1) the minimum coverage and limits specified in this Agreement; or (2) the broader coverage and maximum limits of coverage of any Insurance policy or proceeds available to the named Insured; whichever is greater.

No representation is made that the minimum Insurance requirements of this agreement are sufficient to cover the obligations of the Design Professional under this agreement.

1. Minimum Scope of Insurance. Coverage shall be at least as broad as:

A. Insurance Services Office form number GL 0002 covering Comprehensive General Liability and Insurance Services Office form number GL 0404 covering Broad Form Comprehensive General Liability; or Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001).

B. Insurance Services Office form number CA 0001 covering Automobile Liability, code 1 any auto and endorsement CA 0025.

C. Workers' Compensation insurance as required by the State of California and Employer's Liability Insurance.

D. Professional Liability insurance appropriate to the Design Professional’s profession (Errors and Omission).

2. Minimum Limits of Insurance. Design Professional shall maintain limits no less than:

A. General Liability: $5,000,000 per occurrence for bodily injury, personal injury, and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit.

B. Automobile Liability: $1,000,000 per accident for bodily injury and property damage.

Design Professional Services Agreement (Revised 01.2019) Page 2 of 4 Exhibit C
C. Workers’ Compensation insurance as required by the State of California, with Statutory Limits, and Employer’s Liability Insurance with limit of no less than $1,000,000 per accident for bodily injury or disease. If Design Professional is not subject to California Workers’ Compensation requirements, Design Professional shall file a completed Request for Waiver of Workers’ Compensation Insurance Form which may be obtained from the City prior to commencing any activity authorized hereunder.

D. Professional Liability (Errors and Omission): Insurance appropriates to the Design Professional’s profession with no less than $3,000,000 per occurrence or claim, $5,000,000 aggregate.

3. Deductible and Self-Insured Retention (SIR). Any deductibles or selfinsured retention must be declared to and approved by the City. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or selfinsured retention as respects the City of Vallejo, its officers, officials, employees and volunteers; or the Design Professional shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. All SIRs must be disclosed to the City’s Risk Manager for approval and shall not reduce the limits of liability. Policies containing any SIR provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named Insured or the City.

4. Other Insurance Provisions.

A. Additional Insured Endorsements: The City of Vallejo, its officers, officials, employees, agents and volunteers are to be covered as Additional Insureds as respects; liability, including defense costs, arising out of activities performed by or on behalf of the Design Professional; products and completed operations of the Design Professional; premises owned, occupied or used by the Design Professional; or automobiles owned, leased hired or borrowed by the Design Professional. Additional Insured endorsements with respect to General Liability, Auto and Umbrella/Excess Insurance shall be attached to the Certificate of Insurance presented to the City.

B. 30 Days’ Notice of Cancellation Endorsements: Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City.

C. Waiver of Subrogation Rights Endorsement: The workers’ compensation policy required hereunder shall be endorsed to state that the workers' compensation carrier waives its right of subrogation against City, its officers, officials, employees, agents and volunteers, which might arise by reason of payment under such policy in connection with Design Professional’s performance Design Professional Services Agreement (Revised 01.2019) Page 3 of 4 Exhibit C
under this Agreement. The waiver of subrogation rights endorsement in favor of the City of Vallejo shall be attached to the Certificate of Insurance.

D. The limits of Insurance required in this agreement may be satisfied by a combination of primary and umbrella or excess Insurance. Any umbrella or excess Insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and non-contributory basis for the benefit of the City of Vallejo before the City’s own Insurance or self-insurance shall be called upon to protect it as a named insured.

E. The insurance coverage shall contain no special limitations on the scope of protection afforded to the City of Vallejo, its officers, officials, employees, agents or volunteers. For any claims related to this project, the Design Professional's insurance coverage shall be primary insurance as respects the City of Vallejo, its officers, officials, employees, agents, and volunteers. Any insurance or selfinsurance maintained by the City of Vallejo, its officers, officials, employees, agents, or volunteers shall be excess of the Design Professional's insurance and shall not contribute with it.

F. The Design Professional's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability.

G. Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees, agents, or volunteers.

H. The City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

5. Acceptability of Insurers. The insurance is to be issued by companies licensed to do business in the State of California. The insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VII.

6. Verification of Coverage. Design Professional shall furnish the City with certificates of insurance and original endorsements. The certificates and endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. All endorsements are to be received and approved by the City before work commences. The City reserves the right to obtain a full certified copy of any Insurance policy and endorsements. Failure to exercise this right shall not constitute a waiver of right to exercise later.

7. Subcontractors. Design Professional shall include all subcontractors as insureds under its policies or shall furnish separate certificates and endorsements for each subcontractor. All coverages for subcontractors shall be subject to all of the requirements stated herein.

Design Professional Services Agreement (Revised 01.2019) Page 4 of 4 Exhibit C

8. Payment Withhold. City will withhold payments to Design Professional if the certificates of insurance and endorsements required in Paragraph F, above, are canceled or Design Professional otherwise ceases to be insured as required herein.

THIS BUSINESS LICENSE DOES NOT PERMIT A
BUSINESS THAT IS OTHERWISE PROHIBITED.

Business Name
Business Location
Business Owner(s)
License Number
Effective Date
Expiration Date

CITY OF VALLEJO

BUSINESS LICENSE
3760 KILROY AIRPORT WAY

GHD INC
PO BOX 54968
IRVINE, CA 92619-4921
For all inquiries regarding this license, contact HdL
Business Support Center at 707-302-6074.
"For Services Provided in the City of Vallejo, California Only"

IVER SKAVDAL

GHD INC
July 01, 2021
June 30, 2022
11702318
GHD INC :

Thank you for your payment on your City of Vallejo Business License. ALL LICENSES MUST BE AVAILABLE FOR INSPECTION UPON REQUEST. If you have questions concerning your business license, contact the Business Support Center via email at: [email protected] or by telephone at: (707) 302-6074.

Keep this portion for your license separate in case you need a replacement for any lost, stolen, or destroyed license. A fee may be charged for a replacement or duplicate license.

This certificate does not entitle the holder to conduct business before complying with all requirements of the Vallejo Municipal code and other applicable laws, nor to conduct business in a zone where conducting such business violates law.

If you have a fixed place of business within the City of Vallejo please display the Business License above in a conspicuous place at the premises. Otherwise, every Business License holder not having a fixed place of business in the City shall keep the Business License upon his or her person, or affixed in plain view any cart, vehicle, van or other movable structure or device at all times if required by the Collector.

Starting January 1, 2021, Assembly Bill 1607 requires the prevention of gender-based discrimination of business establishments. A full notice is available in English or other languages by going to: https://www.dca.ca.gov/publications/ City of Vallejo

BUSINESS LICENSE

BUSINESS LICENSING
8839 N CEDAR AVE #212
FRESNO, CA 93720-1832
Date of Issue: 07/01/2021
GHD INC License Number: 11702318
PO BOX 54968
IRVINE, CA 92619-4921

TO BE POSTED IN A CONSPICUOUS PLACE
AND
NOT TRANSFERABLE OR ASSIGNABLE.
2021 - 2022

MARGARET DEZURIK
TAX COLLECTOR’S OFFICE, City Hall, 555 Santa Clara St., Vallejo, CA. This certificate is evidence that the person (s), firm, or corporation named hereon has paid the tax required by Chapter 5.04 of the City of Vallejo Municipal Code for the type of business, the business address and for the period indicated hereon. This certificate is issued without verification that the taxpayer is subject to or exempted from licensing by local, state, Federal or other agencies. Issuance of this certificate is not an endorsement, nor a certificate of compliance with other ordinances or laws, nor an assurance that the proposed use is in conformance with the City ’s building / Fire / Zoning regulations.

ACTION ITEM 9.A.

DATE: March 22, 2022
TO: Mayor and Members of the City Council
FROM: Melissa Tigbao, Acting Public Works Director
SUBJECT: ADOPT A RESOLUTION ADOPTING THE SOLANO COUNTY MULTI-JURISDICTIONAL

HAZARD MITITGATION PLAN

RECOMMENDATION
Adopt a resolution adopting the Solano County Multi-Jurisdictional Hazard Mitigation Plan.

REASONS FOR RECOMMENDATION
The Solano County Multi-Jurisdictional Hazard Mitigation Plan includes long-term actions to reduce the loss of life, personal injury, and property damage that may result from a natural disaster. An approved hazard mitigation plan is a required prerequisite for jurisdictions wishing to pursue funding under FEMA’s Hazard Mitigation Assistance Program.

BACKGROUND AND DISCUSSION
Hazard mitigation planning is the use of long-term actions to reduce the loss of life, personal injury, and property damage that can result from a natural disaster. Over the past 18 months, Dynamic Planning + Science and Solano County worked in conjunction with participating Solano County jurisdictions and agencies to form a Planning Committee to develop the first Solano County Multi-Jurisdictional Hazard Mitigation Plan (MJHMP).

The MJHMP Planning Committee focused on hazard vulnerabilities and mitigation action priorities for the entire County, including for the individual jurisdictions and agencies within the County. A public commenting period for the MJHMP was held from July 29, 2021 through October 26, 2021 and all comments have been addressed. The Solano County MJHMP consists of two volumes:
 Volume 1 (County Hazard Mitigation Plan and Umbrella Plan) – Provides an overview of Solano County Hazard Mitigation Plan, which includes a county-wide in-depth examination and prioritization of each identified hazard (Attachment A.).
 Volume 2 (All Annexes) – Includes each participating jurisdiction and agency. These streamlined documents contain mapping, description of vulnerabilities and potential mitigation action for each participating agency, including for the City of Vallejo (Attachment B.).

The Solano County MJHMP has also been reviewed by the California Office of Emergency Services (Cal OES) and the Federal Emergency Management Agency (FEMA). On December 16, 2021, FEMA issued a letter confirming that the Solano County MJHMP is eligible for final approval after it has been adopted by Solano County and all participating jurisdictions (Attachment C). A current and approved hazard mitigation plan is a prerequisite for jurisdictions wishing to pursue funding under FEMA’s Hazard Mitigation Assistance Date: March 22, 2022
Subject: ADOPT A RESOLUTION ADOPTING THE SOLANO COUNTY MULTIJURISDICTIONAL HAZARD MITITGATION PLAN

Program. Therefore, the City Council must officially adopt the Solano County MJHMP by resolution to render the City of Vallejo eligible for FEMA funding. Also, by adopting the Solano County MJHMP the City acknowledges and recognizes its commitment to reducing the impact of natural hazards and it will ensure that the City is in compliance with the Disaster Mitigation Act of 2000. The Solano County MJHMP must be updated every five (5) years to remain in compliance with the applicable regulations and Federal mitigation grant conditions.

FISCAL IMPACT
Adopting the Solano County Multi-Jurisdictional Hazard Mitigation Plan will have no financial impact upon the City of Vallejo General Fund.

ENVIRONMENTAL REVIEW
This action is exempt from the California Environmental Quality Act (CEQA) because it is not a project which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, pursuant to CEQA Guideline section 15378.

ATTACHMENTS

1. Solano-MJHMP-VOL-1

2. Solano-MJHMP-ANNEX-Vallejo

3. FEMA Letter

4. Solano MJHMP Resolution_CAO Stamp (002)

CONTACT
Melissa Tigbao, Acting Public Works Director (707) 648-4301 [email protected]
Derek Crutchfield, Acting Environmental Services Manager (707) 648-5346 [email protected]

i
SECTION 7
JURISDICTIONAL ANNEX:

City of Vallejo

MULTI-JURISDICTION HAZARD MITIGATION PLAN

SOLANO COUNTY
SOLANO COUNTY | MULTI-JURISDICTION HAZARD MITIGATION PLAN ii

INTENTIONAL BLANK PAGE
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iii
Solano County
Multi-Jurisdiction Hazard Mitigation Plan
CITY OF Vallejo (VL.)
Municipal Annex
Adoption Resolution .......................................................................................................................................................................................iv Section 7. City of Vallejo ...........................................................................................................................7-1

7.1 Purpose.........................................................................................................................................................................................................7-1

7.2 Planning Methodology..........................................................................................................................................................................7-1

7.3 What’s New.................................................................................................................................................................................................7-2

7.4 Risk Assessment.....................................................................................................................................................................................7-3 Hazard Screening Criteria....................................................................................................................................................................................7-3 Hazard Risk Ranking .............................................................................................................................................................................................7-5 Vulnerability Assessment...................................................................................................................................................................................7-5 Mitigation Action Support Tool (MAST) ..................................................................................................................................................... 7-26

7.5 Mitigation Strategy ..............................................................................................................................................................................7-27 Capabilities & Adaptive Capacity Assessment......................................................................................................................................... 7-27 Mitigation Actions ............................................................................................................................................................................................... 7-33 List of Figures
Figure 7-1: City of Vallejo Location..........................................................................................................................................................7-2 Figure 7-2: City of Vallejo Risk Assessment........................................................................................................................................7-7 Figure 7-3: City of Vallejo– Mean Fire Return Interval.................................................................................................................. 7-8 Figure 7-4: City of Vallejo– Wildfire Risk Exposure........................................................................................................................ 7-9 Figure 7-5: City of Vallejo– Concord Green Valley EQ Scenario (M6.8)..................................................................................7-10 Figure 7-6: City of Vallejo– Hayward Rodger’s Creek EQ Scenario (M7.1).............................................................................7-12 Figure 7-7: City of Vallejo– Areas with Potential for Liquefaction ..........................................................................................7-14 Figure 7-8: City of Vallejo– Average Annual Precipitation (1981-2010. Inches)..................................................................7-15 Figure 7-9: City of Vallejo– BAM 200-YR Flooding and Awareness Zones ..........................................................................7-16 Figure 7-10: City of Vallejo– Annual Average Wind Speed (Power Class).............................................................................7-17 Figure 7-11: City of Vallejo– Drought Severity Timeline -San Pablo Bay...............................................................................7-18 Figure 7-12: City of Vallejo – RCP Comparison ................................................................................................................................7-19 FINAL for adoption

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SOLANO COUNTY | MULTI-JURISDICTION HAZARD MITIGATION PLAN iv
Figure 7-13: City of Vallejo– Sea Level Rise Exposure..................................................................................................................7-20 Figure 7-14: Guidance for Problem Statements ..............................................................................................................................7-24 Figure 7-15: Mitigation Action Key ....................................................................................................................................................... 7-33 List of Tables
Table 7-1: Planning Committee Members ............................................................................................................................................7-1 Table 7-2: County-Wide Hazard Prioritization .................................................................................................................................. 7-4 Table 7-3: City Document Review Crosswalk .....................................................................................................................................7-5 Table 7-4: City of Vallejo—Concord Green Valley (M6.8) Damage Estimate Summaries................................................ 7-11 Table 7-5: City of Vallejo—Hayward Rodger’s Creek (M7.1) Damage Estimate Summaries ...........................................7-13 Table 7-6: Drought Classifications and Impacts ..............................................................................................................................7-18 Table 7-7: NFIP Status Table ..................................................................................................................................................................7-23 Table 7-8: Problem Statements..............................................................................................................................................................7-24 Table 7-9: Planning and Regulatory Capabilities ...........................................................................................................................7-28 Table 7-10: Administrative and Technical Capabilities...............................................................................................................7-30 Table 7-11: Financial Capabilities...........................................................................................................................................................7-31 Table 7-12: Education and Outreach Capabilities...........................................................................................................................7-32 Table 7-13: City of Vallejo Mitigation Actions.................................................................................................................................. 7-35 Adoption Resolution
To comply with DMA 2000, the City of Vallejo has officially adopted this Solano County Multi-Jurisdictional Hazard Mitigation Plan (MJHMP), Volume 1, and its jurisdictional annex. The adoption of the MJHMP recognizes the City’s commitment to reducing the impacts of natural hazards. See included adoption resolution.

ADOPTION RECORD TO BE INSERTED UPON COMPLETION.

FINAL for adoption
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7-1
Section 7. City of Vallejo

7.1 Purpose
This Annex details the hazard mitigation planning elements specific to the City of Vallejo. This Annex is not intended to be a standalone document but appends to and supplements the information contained in the umbrella plan document. As such, all sections of the umbrella plan, including the planning process and other procedural requirements apply to and were met by the City of Vallejo. This Annex provides additional information specific to the City of Vallejo, with a focus on providing additional details on the planning process, risk assessment, and mitigation strategy for this community.

Hazard Mitigation Plan Points of Contact
Primary Point of Contact Alternate Point of Contact
Terrance Davis, Public Works Director
City of Vallejo
555 Santa Clara St,
Vallejo, CA 94590
Telephone: 707-648-4316
e-mail: [email protected]
Armond Sarkis, Risk Manager
City of Vallejo
555 Santa Clara St,
Vallejo, CA 94590
Telephone: 707-648-4143
e-mail: [email protected]

7.2 Planning Methodology
The City of Vallejo followed the planning process detailed in Volume 1, Section 3, including participating in the County Hazard Mitigation Planning Committee (HMPC) and Steering Committee and formulating their own internal planning team to support the broader planning process. Internal planning participants, their positions, and how they participated in the planning process are shown in Table 7-1.

Table 7-1: Planning Committee Members
Planning Committee Members Department
Terrance Davis Public Works Director
Armond Sarkis Risk Manager
Ben Smith Risk Analyst
Byron Berhel Emergency Manager
Christina Ratcliffe Planning Manager
Margaret Kavanaugh- Lynch Planning Manager
Melissa Cansdale Associate Engineer
Sal Nuno Maintenance Superintendent
Addison LeBlanc Assistant Engineer
Cathy Carpenter Engineering Technician
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Figure 7-1: City of Vallejo Location

7.3 What’s New
The City of Vallejo has not had a hazard mitigation plan since participating in the 2006 Association of Bay Area Governments MJHMP. Because the City’s annex to the ABAG Plan is outdated, the Planning Committee elected to not include any of the mitigation actions from the earlier plan in this MJHMP. Starting fresh will ensure that the City’s mitigation strategy addresses its most pressing current vulnerabilities. The City’s efforts to incorporate hazard mitigation into other planning mechanisms are documented in Section 1.5.1, the Capabilities Assessment.

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7-3

7.4 Risk Assessment
The intent of this section is to profile the City of Vallejo’s hazards and assess the City’s vulnerabilities, distinct from that of the County wide planning area. The hazard profiles in Volume 1 discuss overall impacts to the planning area and describes the hazard problem description, hazard extent, magnitude/severity, previous occurrences of hazard events and the likelihood of future occurrences. For more information on Risk Assessment Methodologies, see Vol. 1 and Appendix A.

Hazard Screening Criteria
Planning Team members from each participating jurisdiction collectively discussed which hazards should be profiled in the Plan and which should not. The results of that discussion can be found in Table 7-2.

Detailed hazard profiles of the most significant County wide hazards are described in Section 4 of Volume 1.

The Planning Team reviewed previously-prepared hazard mitigation plans and other relevant documents to determine the realm of natural hazards that have the potential to affect the City of Vallejo. Table 7-3 provides a crosswalk of hazards identified in Vol. 1 of this plan, the City of Vallejo General Plan, and 2018 California State Hazard Mitigation Plan. The crosswalk was used to develop a preliminary hazards list, providing a framework for the Planning Team members to evaluate which hazards were truly relevant to the City of Vallejo and which ones were not. Section 0 below describes the hazard risk ranking process that was performed by the planning team which prioritized hazards that are specifically relevant to the City of Vallejo.

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Table 7-2: County-Wide Hazard Prioritization
Hazard Type Explanation
Climate Change High priority county-wide, profiled hazard.

Dam/ Levee failure
Dam failure is possible in Solano County but is best addressed in other plans, specifically Emergency Action Plans for high hazard dams affecting Solano County.

Drought High priority county-wide, profiled hazard.

Earthquake/ Geologic Hazards High priority county-wide, profiled hazard.

Flood High priority county-wide, profiled hazard.

Hazardous Material While hazardous materials can release and impact the County, there are better avenues to address this hazard outside this plan.

High Winds/ Straight Line Winds High priority county-wide, profiled as part of Extreme Weather.

Insect Hazards While hazardous insects exist in Solano County, this was not considered a priority and is not profiled in this plan.

Pandemic Disease While pandemic disease can impact the County, there are better avenues to address this hazard outside this plan.

Extreme Weather, including: High priority county-wide for high wind, heavy rain, and high heat.

Extreme Heat Profiled as part of Extreme Weather.

Hail Hail events are rare and not considered a priority.

High Wind Profiled as part of Extreme Weather.

Heavy Rain Profiled as part of Extreme Weather.

Fog Fog events are rare and are not considered a priority.

Lightning Not a priority as an extreme weather event; discussed as source of wildfire.

Severe Thunderstorm Severe thunderstorms were not identified as a priority in this plan.

Winter Storm / Extreme Cold/
Freeze Events
Winter storms are rare in Solano County and not identified as a priority for this plan.

Slope Failure High priority county-wide, profiled hazard.

Soil Hazards While limited soil hazards exist in Solano County (erosion and shifting soils), these are not prioritized in this plan. Erosion discussed under flood hazard.

Terrorism/Human Caused Threats
While terrorism is certainly a threat to the County and participating jurisdictions, it is best addressed in other plans as this HMP does not address human-caused threats.

Tornado Impacts to the County from tornados are extremely unlikely, if any.

Volcanic Activity Due to distance from volcanoes and the limited chance of an eruption, this hazard was not identified as a priority.

Wildfire High priority county-wide, profiled hazard.

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Table 7-3: City Document Review Crosswalk
Hazards
2014 Vallejo General
Plan
2014 Solano County
HMP
2018 California State
HMP
Agricultural Pests ■
Climate Change ■ ■ ■
Dam Failure ■ ■ ■
Drought ■ ■ ■
Earthquake ■ ■ ■
Extreme Weather ■ ■
Flood ■ ■ ■
Landslide ■ ■ ■
Levee Failure ■ ■
Manmade Hazards ■ ■
Pandemic Disease ■
Sea Level Rise ■ ■ ■
Soil Hazards ■ ■
Terrorism & Tech Hazards ■
Tsunami ■
Volcano ■
Wildfire ■ ■ ■
Hazard Risk Ranking
The City of Vallejo’s Planning Team used the same hazard prioritization process as the Solano County Hazard Mitigation Planning Committee. This process is described in detail in Section 4.3.1 of Vol. 1. Figure 7-2 displays the results of the hazard risk ranking exercise that was performed by the Planning Team. The Planning Team chose to assess the City of Vallejo’s vulnerability to the following hazards:
▪ Wildfire ▪ Drought
▪ Earthquake ▪ Climate Change
▪ Extreme Weather (heavy rain, high wind)
All of these hazards have been profiled in Vol. 1 of this document. The purpose of this annex to specifically address the City of Vallejo’s vulnerability to these specifically-identified hazards.

Vulnerability Assessment
Assessing vulnerabilities exposes the unique characteristics of individual hazards and begins the process of narrowing down which areas within the City of Vallejo are vulnerable to specific hazard events. The vulnerability assessment considered unique local knowledge of hazards and impacts and a GIS overlaying method for examining such vulnerabilities more in depth. Using these methods, participating jurisdictions estimated vulnerable populations, infrastructure, and potential losses from hazards.

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7.4.3.1 Risk Assessment
Each participating jurisdiction developed a risk matrix that assessed the probability and impact of various hazards within the jurisdiction. Figure 7-2 is the jurisdiction’s risk assessment, which was completed in part using the web based and interactive Risk Assessment Mapping Platform (RAMP), accessed via the project website at www.mitigatehazards.com. RAMP allows interactive discovery of robust risk, vulnerability, and exposure data developed especially for Solano County. RAMP is a mapping platform built specifically for mitigation planning. It displays County/jurisdiction facilities and buildings overlaid with natural hazards layers to bring interactivity and individual discovery to the GIS analysis performed for the MJHMP. See Vol. 1 for a detailed description of RAMP. The Planning Team used RAMP in meetings and as needed to understand vulnerabilities to the City of Vallejo. Users interactively filter facilities and buildings by natural hazard zones and/or construction characteristics. The City of Vallejo also conducted a more detailed climate vulnerability assessment, included as Appendix A to this annex. The climate vulnerability assessment analyzed climate-related vulnerabilities by considering the impact from the climate vulnerability and the community’s adaptive capacity to respond to the particular vulnerability.

7.4.3.2 Snapshot Exposure Maps & Damage Estimation
The included snapshot maps and damage estimation tables illustrate the City of Vallejo’s vulnerability to specific hazards. Based on the risk assessment, the snapshot maps focus on those hazards prioritized by the jurisdiction. These maps helped the Planning Team understand the exposure of population, parcels, and critical infrastructure to specific hazards. Each map contains an exposure summary that displays the percent of the population, the improvement and content value of parcels, and the amount of critical infrastructure that is exposed to each respective hazard. For flood and earthquake, detailed damage estimations were conducted through FEMA’s Hazus software and are shown in tabular form. Additional mapping is also included. Figures and tables include:
▪ Figure 7-3: City of Vallejo– Mean Fire Return Interval ▪ Figure 7-4: City of Vallejo– Wildfire Risk Exposure
▪ Figure 7-5: City of Vallejo– Concord Green Valley EQ Scenario (M6.8) ▪ Table 7-4: City of Vallejo—Concord Green Valley (M6.8) Damage Estimate Summaries ▪ Table 7-5: City of Vallejo—Hayward Rodger’s Creek (M7.1) Damage Estimate Summaries ▪ Figure 7-6: City of Vallejo– Hayward Rodger’s Creek EQ Scenario (M7.1) ▪ Figure 7-7: City of Vallejo– Areas with Potential for Liquefaction ▪ Figure 7-8: City of Vallejo– Average Annual Precipitation (1981-2010. Inches) ▪ Figure 7-10: City of Vallejo– Annual Average Wind Speed (Power Class) ▪ Figure 7-9: City of Vallejo– BAM 200-YR Flooding and Awareness Zones o Flood not a prioritized hazard. Map included as part of Safety Element compliance. ▪ Figure 7-11: City of Vallejo– Drought Severity Timeline -San Pablo Bay ▪ Figure 7-12: City of Vallejo – RCP Comparison
▪ Figure 7-13: City of Vallejo– Sea Level Rise Exposure FINAL for adoption
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Figure 7-2: City of Vallejo Risk Assessment
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Figure 7-3: City of Vallejo– Mean Fire Return Interval
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Figure 7-4: City of Vallejo– Wildfire Risk Exposure
The below exposure summary
applies only to high and very high
wildfire severity zones, and is not
meant to capture full vulnerability
to wildfire; see Table 1-5, problem
statements, for additional wildfire
vulnerabilities.

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Figure 7-5: City of Vallejo– Concord Green Valley EQ Scenario (M6.8) FINAL for adoption
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Table 7-4: City of Vallejo—Concord Green Valley (M6.8) Damage Estimate Summaries Building
Type
Average of
Potential
Damage to
Exceed
“Slight”
Average of
Potential
Damage to
Exceed
“Moderate”
Average of
Potential
Damage to
Exceed
“Extensive”
Average
Economic
Loss for Each
Building
Category
Sum of
Economic
Loss
Proportion of
Loss (%)
Agriculture 0% 0% 0% $0 $0 0%
Commercial 30% 10% 2% $155,841 $145,866,860 17%
Education* 45% 24% 5% $588,511 $5,296,597 1%
Emergency 34% 13% 3% $177,548 $3,906,059 0%
Government 28% 9% 1% $216,927 $25,814,368 3%
Industrial 47% 26% 6% $230,672 $37,368,842 4%
Religion 26% 6% 0% $52,793 $6,335,198 1%
Residential 28% 5% 0% $18,164 $620,581,257 73%
Total $845,169,181
*School district asset information not available during time of Hazus analysis.

Note: Total Inventory Values
1 - Building Replacement Costs = $3,773,922,295
2 - Content Replacement Costs = $2,667,166,517
3 - Total Value = $6,441,088,812
$0 $200,000,000 $400,000,000 $600,000,000 $800,000,000
Agriculture
Commercial
Education
Emergency
Government
Industrial
Religion
Residential
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Figure 7-6: City of Vallejo– Hayward Rodger’s Creek EQ Scenario (M7.1) FINAL for adoption
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Table 7-5: City of Vallejo—Hayward Rodger’s Creek (M7.1) Damage Estimate Summaries Building
Type
Average of
Potential
Damage to
Exceed
“Slight”
Average of
Potential
Damage to
Exceed
“Moderate”
Average of
Potential
Damage to
Exceed
“Extensive”
Average
Economic
Loss for Each
Building
Category
Sum of
Economic
Loss
Proportion of
Loss (%)
Agriculture 0% 0% 0% $0 $0 0%
Commercial 26% 9% 2% $142,109 $133,013,978 23%
Education* 41% 22% 6% $551,693 $4,965,237 1%
Emergency 27% 10% 2% $138,433 $3,045,526 1%
Government 22% 7% 1% $220,032 $26,183,768 4%
Industrial 43% 23% 5% $206,621 $33,472,661 6%
Religion 20% 4% 0% $35,564 $4,267,662 1%
Residential 19% 3% 0% $11,211 $383,039,007 65%
Total $587,987,839
*School district asset information not available during time of Hazus analysis.

Note: Total Inventory Values
1 - Building Replacement Costs = $3,773,922,295
2 - Content Replacement Costs = $2,667,166,517
3 - Total Value = $6,441,088,812
$0 $100,000,000 $200,000,000 $300,000,000 $400,000,000 $500,000,000 Agriculture
Commercial
Education
Emergency
Government
Industrial
Religion
Residential
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Figure 7-7: City of Vallejo– Areas with Potential for Liquefaction FINAL for adoption
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Figure 7-8: City of Vallejo– Average Annual Precipitation (1981-2010. Inches) FINAL for adoption

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Figure 7-9: City of Vallejo– BAM 200-YR Flooding and Awareness Zones FINAL for adoption
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Figure 7-10: City of Vallejo– Annual Average Wind Speed (Power Class) FINAL for adoption

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Table 7-6: Drought Classifications and Impacts
Category Description Possible Impacts
D0 Abnormally Dry
▪ Active fire season begins
▪ Going into drought, short term dryness, slowing planting, growth of crops or pastures. ▪ Coming out of drought, some lingering water deficits and pasture or crops not fully recovered,
D1
Moderate
Drought
▪ Some damage to crops, pastures
▪ Streams, reservoirs, or wells low, some water shortages developing or imminent ▪ Voluntary water-use restrictions requested
D2 Severe Drought
▪ Crop or pasture losses likely
▪ Water shortages common
▪ Water restrictions imposed
D3
Extreme
Drought
▪ Major crop/ pasture losses
▪ Widespread water shortages or restrictions
D4
Exceptional
Drought
▪ Exceptional and widespread crop/ pasture losses
▪ Shortages of water in reservoirs, streams, and wells creating water Adapted from U.S. Drought Monitor Drought Classifications and Impacts Figure 7-11: City of Vallejo– Drought Severity Timeline -San Pablo Bay FINAL for adoption
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Figure 7-12: City of Vallejo – RCP Comparison
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Figure 7-13: City of Vallejo– Sea Level Rise Exposure
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7.4.3.3 Past and Future Development
The City of Vallejo is a charter city that crafts its own laws related to municipal affairs, including future development. If the City has not regulated, or the issue is not municipal in nature, the City is subject to State law. Future development may be subject to compliance with State of California planning, zoning, subdivision, and architecture laws.

The City of Vallejo’s General Plan (GP) establishes long-range development policies. The GP is designed to help the City address issues related to land use, circulation (traffic), housing, open space, conservation, noise, and safety. The Land Use portion of the plan helps guide the City in determining the location of future development(s), including possible future annexation. In addition to the GP, the City has other plans that guide development in specific areas, including specific plans, policy plans, and master plans. These plans help to shape future development and dictate the City’s Sphere of Influence (SOI). One of the central functions in these planning documents is to decrease risk of impact from natural hazards.

Development since Previous HMP
While growth has occurred in hazard areas in the past, increasing hazard risks to some degree, those risks are also decreased by development standards and plan requirements that serve to mitigate or avoid those risks. Development since the last HMP has not increased hazard vulnerability for the City of Vallejo.

Problematic development generally occurred many decades ago; therefore, this HMP Annex has not been revised to reflect any substantial changes in past development and instead focuses on avenues to better mitigate impacts from problematic past development in the 1970’s and earlier.

Future Development
City of Vallejo is required to update building codes to meet the minimum standards to those required in the California Building Code last updated in 2019. California Building Codes provide some of the safest construction standards in the world and are meant to reduce risk to occupants from high wind, seismic activity, landslides, flood, wildfire, and other natural hazards. In addition to California minimum develop standards, all jurisdictions belong to the NFIP, and all development must meet minimum flood protection standards set forth by FEMA. See Section 4.3.5 of Volume 1 for more information about past and future development in Solano County.

As the General Plan is updated and incorporates information from this HMP, City of Vallejo staff are continually improving hazard information through these hazard mitigation plan updates. With this 2020 update, improved online mapping about natural hazards available on RAMP will inform those responsible for future development to make better decisions where and how future development occurs.

City of Vallejo reviewed its general plans under the capability assessments undertaken for this hazard mitigation plan. See Section 7.5.1. Deficiencies revealed by these reviews are identified as mitigation actions to decrease risks to move beyond past trends.

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The City’s municipal codes includes regulations to mitigate the impact of hazards on new and existing development, including:
▪ Drainage and stormwater retention requirements,
▪ Steep slope restrictions for new development,
▪ Waterbody buffer requirements,
▪ Floodplain management regulations,
▪ Zoning that prevents development in hazardous areas of the community such as floodplains, landslide areas, the wildland-urban interface (WUI), or other known hazard areas, and ▪ Building codes that include the most up-to-date California Fire Code, seismic standards, and many other provisions crafted to protect new construction from hazard events.

Even in the event that limited development did occur within a hazard area, the municipal code should ensure impacts from a hazard event are mitigated and losses are minimal. If development does occur in hazard areas, evacuation and emergency planning should take into consideration the anticipated local impacts of the hazard event, including potential interrupted services or the elimination of access.

The anticipated growth in the City will not cause significant change in vulnerability to the City for identified priority hazards.

National Flood Insurance Program (NFIP)
The NFIP makes federally backed flood insurance available to homeowners, renters, and business owners in participating communities. FEMA has prepared a detailed Flood Insurance Study (FIS) for Solano County and municipalities. The study presents water surface elevations for floods of various magnitudes, including the 1-percent annual chance flood and the 0.2-percent annual chance flood (the 500-YR flood). Base flood elevations and the boundaries of the 100- and 500-YR floodplains are shown on Flood Insurance Rate Maps (FIRMs), which are the principal tools for identifying the extent and location of the flood hazard. FIRMs are the most detailed and consistent data source available, and for many communities they represent the minimum area of oversight under their floodplain management program. See Section 4 of Volume 1 for general information on the NFIP.

The City of Vallejo has participated in the NFIP since 1978. The City of Vallejo is currently in good standing with the provisions of the NFIP. Compliance is monitored by FEMA regional staff and by the California Department of Water Resources under a contract with FEMA. Maintaining compliance under the NFIP is an important component of flood risk reduction. See Table 7-7 for more information on the City’s policies and historic flood insurance claims.

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Table 7-7: NFIP Status Table
NFIP and CRS Status & Information
City of Vallejo
NFIP Status 10/17/78
CRS Class -
Policies in Force 314
Policies in SFHA 144
Policies in non-SFHA 170
Total Claims Paid $890,171
Paid Losses 132
Repetitive Loss Properties 18
Severe Repetitive Loss Properties 1
Repetitive Loss Payment by NFIP on Building $424,760
Repetitive Loss Payment by NFIP on Contents $63,439
Source: FEMA CIS 2021, OpenFEMA Data, FIMA RUL Solano County Note: Policies and claims provided directly from FEMA Region IX CIS Report (8/2021). Repetitive loss tabulations by jurisdiction derived via GIS-based intersect of data available at OpenFEMA Data (https://www.fema.gov/about/openfema/data-sets). Countywide data reported for entire county area including municipalities.The Privacy Act of 1974 (5 U.S.C. 522a) restricts the release of certain types of data to the public. Flood insurance policy and claims data are included in the list of restricted information. FEMA can only release such data to state and local governments, and only if the data are used for floodplain management, mitigation, or research purposes.

Therefore, this plan does not identify the repetitive loss properties or include claims data for any individual property.

See Volume 1, Section 4.5 for more information on the NFIP

7.4.3.4 Identify Hazard Problem Statements
As part of the mitigation action identification process, the Planning Committee for each jurisdiction identified areas of concern (aka problem statements) for their respective facilities based on the risk assessment and vulnerability analysis, utilizing the RAMP mapping and static snapshot maps. Problem statements focused on the impact, victim, or threat that the hazard could create in the jurisdiction, as described in Figure 7-14. Identifying common issues and weaknesses through these problem statements assisted the Planning Committee in understanding the realm of resources needed for mitigation.

Jurisdiction problem statements are listed in Table 7-8.

The goal is to have at least one mitigation action for every problem statement. Projects or actions have been developed to mitigate each problem identified. See Table 7-13 for a full list of mitigation actions and corresponding problem statements that they address. Each problem statement is coded with a problem number for cross-referencing between Table 7-8 and Table 7-13.

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Figure 7-14: Guidance for Problem Statements
Table 7-8: Problem Statements
Problem
No.

Hazard
Type
Area of
Concern
Mitigation
Alternatives
Primary
Agency Problem Description Related MA
ps-WF-VL60
Wildfire Impact PRV -
Prevention ,
NRP - Natural
Resource
Protection
City of
Vallejo
The City can benefit from additional
vegetation management efforts to
minimize the presence of wildfire
fuels.
ma-EW-VL158
ps-WF-VL61
Wildfire Victim PRV -
Prevention ,
PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness , ES
- Emergency
Services
City of
Vallejo
There are approximately 51,227 people
living in a moderate wildfire risk area
in the City of Vallejo.
ma-WF-VL160
ps-WF-VL62
Wildfire Victim PRV -
Prevention ,
PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness
City of
Vallejo
There are 91 child care facilities
located in a moderate wildfire risk area
in the City of Vallejo.
ma-WF-VL160
ps-WF-VL63
Wildfire Threat PRV -
Prevention ,
PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness
City of
Vallejo
The City has a lot of open space with
fuels that increase the risk of wildfire.

Glenco Waterfront Park and Don Hunts
park are areas of specific concern.
ma-EW-VL158, ma-WFVL-161
▪ Casualties
▪ Property Damage
▪ Business Interruption
▪ Financial Loss
▪ Environmental
Contamination
▪ School Children in
High Hazard Areas
▪ Care Facilities in High
Hazard Areas
▪ Vulnerable Population
Exposed to Hazards
▪ Increased Fuels due to
Drought
▪ Hotter, Drier Climate
▪ More Intense Storms
▪ Impervious Surfaces =
Greater Runoff
▪ Increases of Invasive
Species
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Problem
No.

Hazard
Type
Area of
Concern
Mitigation
Alternatives
Primary
Agency Problem Description Related MA
ps-EQ-VL64
Earthquake Impact ES - Emergency
Services , SP -
Structural
Projects
City of
Vallejo
The City does not have a seismic gas
shut-off valve ordinance or program.
ma-EQ-VL-150
ps-EQ-VL-65 Earthquake Impact ES - Emergency
Services , SP -
Structural
Projects
City of
Vallejo
City facilities may lack seismic gas
shut-off valves.
ma-EQ-VL-151
ps-EQ-VL-66 Earthquake Impact SP - Structural
Projects
City of
Vallejo
Buildings on Mare Island may be
particularly vulnerable to the impacts
of earthquakes due to their old age.
ma-EQ-VL-152
ps-EQ-VL-67 Earthquake Impact PRV -
Prevention , ES
- Emergency
Services
City of
Vallejo
Emergency Action Plan's for dams
throughout the City of Vallejo are in
need of updating in the next couple
years.
ma-EQ-VL-153
ps-EQ-VL-68 Earthquake Impact SP - Structural
Projects
City of
Vallejo
Unreinforced masonry buildings in the
City of Vallejo are vulnerable to the
impacts of earthquakes.
ma-EQ-VL-152
ps-EQ-VL-69 Earthquake Impact SP - Structural
Projects
City of
Vallejo
Aging infrastructure, including
pipelines, are vulnerable to the
impacts of earthquakes.
ma-EQ-VL-152
ps-EQ-VL-70 Earthquake Impact SP - Structural
Projects
City of
Vallejo
City water tanks and reservoirs are
vulnerable to the impacts of
earthquakes.
ma-EQ-VL-154
ps-EQ-VL-71 Earthquake Victim PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness , ES
- Emergency
Services , SP -
Structural
Projects
City of
Vallejo
Approximately 44,208 people live in a
very strong shake zone for 6.8 Concord
Green Valley EQ Scenario.
ma-EQ-VL-155
ps-EQ-VL-72 Earthquake Victim PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness , ES
- Emergency
Services , SP -
Structural
Projects
City of
Vallejo
Approximately 2,311 people live in a
severe shake zone area for the 7.1
Hayword Rodgers Creek EQ scenario.
ma-EQ-VL-155
ps-EQ-VL-73 Earthquake Victim PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness , ES
- Emergency
Services , SP -
Structural
Projects
City of
Vallejo
There are 66 child care facilities and 13
schools located in a very strong shake
zone for the 6.8 Concord Green Valley
EQ Scenario.
ma-EQ-VL-155
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Problem
No.

Hazard
Type
Area of
Concern
Mitigation
Alternatives
Primary
Agency Problem Description Related MA
ps-DR-VL74
Drought Impact PE&A - Public
Education &
Awareness , SP
- Structural
Projects
City of
Vallejo
Periods of drought can have an impact
on the water supply for the City of
Vallejo.
ma-DR-VL-149
ps-EW-VL75
Extreme
Weather
Impact PE&A - Public
Education &
Awareness , ES
- Emergency
Services
City of
Vallejo
High wind events can increase the
frequency of PSPS events, impacting
City pump stations.
ma-EW-VL156
ps-EW-VL76
Extreme
Weather
Impact PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness , SP
- Structural
Projects
City of
Vallejo
Heavy rains could create localized
flooding issues around City
infrastructure and roads, posing a
threat to buildings and creating
hazardous travel conditions.
ma-FL-VL-157
ps-EW-VL77
Extreme
Weather
Threat PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness
City of
Vallejo
High winds exacerbate the impacts of
wildfire.
ma-EW-VL158
ps-EW-VL78
Extreme
Weather
Threat PPRO - Property
Protection ,
PE&A - Public
Education &
Awareness ,
NRP - Natural
Resource
Protection
City of
Vallejo
High winds can blow trees over
presenting hazards for buildings,
roads, and pedestrians/cars.
ma-EW-VL159
ps-CC-VL181
Climate
Change
Impact SP - Structural
Projects
City of
Vallejo
The City has an estimated 2,500
parcels in areas that would be exposed
to high and extreme levels of sea level
rise.
ma-CC-VL-203
Mitigation Action Support Tool (MAST)
As a living document, hazard problem statements and mitigation activities will be updated through a web interface application developed specifically for participating jurisdictions. The Mitigation Action Support Tool (MAST) is accessible through mitigatehazards.com/SolanoHMP/.

MAST is a web-based interactive tool that enables multiple users to search, view, enter, and update mitigation actions, ideas or projects, and other information. MAST provides participating jurisdictions and plan reviewers (Cal OES/FEMA) access to valuable mitigation information that can be leveraged by future planning or other risk reduction efforts within the County. Participating jurisdictions can update the status of their mitigation projects throughout the planning lifecycle, and this web-based tool will improve participating jurisdiction’s ability to apply for FEMA’s Hazard Mitigation Assistance (HMA) grant programs including initial grant application processes through Cal OES.

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7.5 Mitigation Strategy
The mitigation strategy is the guidebook to future hazard mitigation administration, capturing the key outcomes of the MJHMP planning process. The mitigation strategy is intended to reduce vulnerabilities outlined in the previous section (a.k.a. problem statements) with a prescription of policies and physical projects. These mitigation actions should be compatible with existing planning mechanisms and should outline specific roles and resources for implementation success.

Capabilities & Adaptive Capacity Assessment
This section examines the planning and regulatory, administrative, technical, financial, educational, and outreach capabilities to augment known issues and weaknesses from identified natural hazards.

Capabilities assessments in this Volume 1 and in Volume 2 include considerations of a community’s adaptive capacity for climate change, as outlined in Cal OES’ 2020 California Adaptation Planning Guide.

Adaptive capacity is a community or region’s existing ability to moderate climate change impacts.

Assessing adaptive capacity includes analysis of policies, plans, programs, funding, and staffing capacity.

The tables in this section explore various local planning mechanisms, administrative capacity, financial capabilities, and education and outreach initiatives. The columns in each table represent deeper dives into the following questions:
▪ Is the existing planning or regulatory mechanism used currently? (Column 1, Status) ▪ Has the HMP been integrated into the planning mechanism currently so that the named mechanism is currently used in HMP planning? (Column 2, Current Mitigation Use) ▪ Is there a future opportunity to expand, improve upon, and incorporate this 2020 HMP Update into the planning or regulatory mechanism? (Column 3, Future Opportunity) The capabilities assessment is easily-digestible and based on color coding to indicate which policies and plans are adequate, need improvement or in which the HMP could be integrated. Each table includes a legend that explain how each one of these questions are being answered according to the color indicated:
green, yellow, and orange.

For more information on the regulatory environment surrounding each hazard, see hazard-specific sections of Volume 1. Volume 1, Section 5.3.5 includes an extensive list of federal and state funding opportunities as well.

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7.5.1.1 Planning and Regulatory Capabilities
Table 7-9: Planning and Regulatory Capabilities

CAPABILITY ASSESSMENT LEGEND
Status Current Mitigation Use Future Opportunity
Currently in use or present. Used widely for mitigation. Opportunity to expand and integrate. (Sort of) Seldomly used or limited
presence.

Limited use in mitigation planning. Limited opportunity to expand and integrate. (No) Not present or available. Not used in mitigation planning. No opportunity to expand or integrate.

HMP Integration
Resource Status Notes / Additional Detail
Current
Mitigation
Use
Future
Opportunity
Planning and Regulatory Capabilities
Construction and Future Development Regulations
Building Codes Green Green Yellow 2019 California Building Code Building Code Effectiveness Grading
Schedule (BCEGS) Rating Green Yellow Yellow
Public Protection (ISO Class) Green Yellow Yellow
Hazard Related Development Standards Green Green Yellow Standards for construction (7.98.160) Hazard-Specific Ordinance
Green Green Green
Flood Management Regulations (Chpt. 7.98);
Mudslide prone areas (7.98.230); Coastal High
Hazard Areas (7.98.220)
Zoning Ordinance Green Yellow Green
Growth Management Ordinance Orange Orange Green
Hazard Reduction Programs (Annually Conducted)
Capital Improvements Program (CIP) or
Plan Green Yellow Green
Erosion/Sediment Control Program Orange Orange Green
Hazard-Related Public Outreach Program Green Green Green Stormwater Management Program
(Annual Inspections) Green Green Yellow
Seismic Safety Program (Non-structural
Inspections) Yellow Yellow Yellow
Earthquake Modernization Program
(Building Safety Inspections) Yellow Yellow Yellow
Hazard Plans
General Plan Safety Element Green Green Green General Plan 2040 Noteworthy Area/ Specific Plan with
Hazard Focus Green Yellow Green White Slough Specific Plan (Solano County, 1979)
Community Wildfire Protection Plan
(CWPP) Orange Orange Green
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HMP Integration
Resource Status Notes / Additional Detail
Current
Mitigation
Use
Future
Opportunity
Planning and Regulatory Capabilities
Wildfire Vulnerability Assessment Orange Orange Green
Urban or Integrated Regional Water
Management Plan Green Green Yellow 2015 City of Vallejo Urban Water Management Plan
Floodplain Management Plan N/A N/A N/A Vallejo Flood and Wastewater jurisdiction Stormwater Management Plan Green Green Yellow Storm Water Pollution Prevention Plan Ground Water Management Plan(s) Orange Orange Yellow Solano County GSP in development Open Space and Land Management
Plan(s) Green Yellow Green
Emergency Operations Plan Green Yellow Green 2017 Solano County Emergency Operations Plan
Climate Action Plan, Vulnerability Ass'mt,
or Adaptation Plan Yellow Yellow Green 2011 County of Solano Climate Action Plan; 2012 unadopted Plan
Sustainable Community Plan (SB 375) Green Green Green 2012 Climate Action Plan Local Delta/ Wetlands Program(s)
Green Green Green Delta Plan; White Slough Specific Plan (Solano County, 1979)
Downtown Plan with hazard focus Yellow Orange Green Downtown Specific Plan Community Health Assessment(s) N/A N/A N/A Solano County Community Health Assessment
National Flood Protection Program (NFIP)
Floodplain Management Regulations Green Green Yellow
Flood Insurance Education and Technical
Assist. Green Green Green 2013 Flood Insurance Study
Flood Hazard Mapping / Re-Mapping Green Yellow Yellow
Community Rating System (CRS) Orange Orange Green
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7.5.1.2 Administrative and Technical Capabilities
Table 7-10: Administrative and Technical Capabilities

CAPABILITY ASSESSMENT LEGEND
Status Current Mitigation Use Future Opportunity
Currently in use or present. Used widely for mitigation. Opportunity to expand and integrate. (Sort of) Seldomly used or limited
presence.

Limited use in mitigation planning. Limited opportunity to expand and integrate. (No) Not present or available. Not used in mitigation planning. No opportunity to expand or integrate.

HMP Integration
Resource Status
Current
Mitigation
Use
Future
Opportunity Notes / Additional Detail
Administrative and Technical
Community Planning and
Development Services
Community Planner
Green Green Green
While the City is fully staffed, and staff focus
on hazard mitigation as appropriate, there are
ample opportunities to better integrate the
HMP into staffing roles and responsibilities.

Civil Engineer Green Green Green
Building Code Official Green Green Green
Floodplain Administrator Green Green Green
Fire Marshall Green Green Green
Dedicated Public Outreach Personnel Green Green Green
GIS Specialist and Capability Green Green Green
Emergency Manager Green Green Green
Grant Manager, Writer, or Specialist Orange Orange Green Other 0 0 0
Warning Systems/Services
General Green Green N/A AlertSolano
Flood
Green Green N/A
Emergency Alert: AlertSolano
Flood Risk: California Department of Water
Resources Flood Risk Notification Program
Flood Control: Solano County Water Agency
Wildfire Green Green N/A AlertSolano
Geological Hazards Green Green N/A AlertSolano; ShakeAlert.org (nation-wide) FINAL for adoption
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7.5.1.3 Financial Capabilities
Table 7-11: Financial Capabilities

CAPABILITY ASSESSMENT LEGEND
Status Current Mitigation Use Future Opportunity
Currently in use or present. Used widely for mitigation. Opportunity to expand and integrate. (Sort of) Seldomly used or limited
presence.

Limited use in mitigation planning. Limited opportunity to expand and integrate. (No) Not present or available. Not used in mitigation planning. No opportunity to expand or integrate.

HMP Integration
Resource Status
Current
Mitigation
Use
Future
Opportunity Notes / Additional Detail
Fiscal Capabilities
Financial Resources for Hazard
Mitigation
Levy for Specific Purposes with Voter
Approval Yellow Yellow Green Also under VFWD jurisdiction Utilities Fees N/A N/A N/A
Benefit assessments Orange Orange Green
System Development Fee N/A N/A N/A
Various Bonds to Incur Debt Orange Orange Green
Withheld Spending in Hazard-Prone
Areas Orange Orange Green
Stormwater Service Fees N/A N/A N/A VFWD
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7.5.1.4 Education and Outreach
Table 7-12: Education and Outreach Capabilities

CAPABILITY ASSESSMENT LEGEND
Status Current Mitigation Use Future Opportunity
Currently in use or present. Used widely for mitigation. Opportunity to expand and integrate. (Sort of) Seldomly used or limited
presence.

Limited use in mitigation planning. Limited opportunity to expand and integrate. (No) Not present or available. Not used in mitigation planning. No opportunity to expand or integrate.

HMP Integration
Resource Status Notes / Additional Detail
Current
Mitigation
Use
Future
Opportunity
Education / Outreach Capabilities
Education/Outreach Resources
Website Dedicated to Hazard Topics Yellow Yellow Green Vallejo Flood and Wastewater has some; limited flood; could focus more on mitigation
Dedicated Social Media Green Yellow Green
Hazard Info. Avail. at Library/ Planning
Desk Green Yellow Green
Annual Public Safety Events Yellow Yellow Yellow None recently due to COVID-19 Ability to Field Public Tech. Assistance
Requests Green Yellow Green
Public Safety Newsletters or Printed
Outreach Green Orange Yellow
Fire Safe Councils N/A N/A N/A
Resource Conservation Districts Green Yellow Green Solano Resource Conservation District Other 0 0 0

7.5.1.5 Capability and Adaptive Capacity Opportunities
The City of Vallejo identified many opportunities for strengthening community capabilities and adaptive capacity. The City considered this assessment in developing its Mitigation Strategy.

Notably some of the city’s mitigation-related planning documents are quite old and could be updated as a first step to increasing capacity. The City also had good capacity under its current codes, staffing capacity, and education and outreach capacity.

Volume 1, Section 5.3.5 includes an extensive list of federal and state funding opportunities to leverage to improve community capabilities.

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Mitigation Actions
Mitigation actions were developed based upon the
jurisdiction’s priorities, risk assessment results, and mitigation alternatives. The mitigation action
prioritization method used by all participating
jurisdictions is described in Section 5.5.1 of Volume 1.

Table 7-13 lists each priority mitigation action,
responsible party, time frame, potential funding source, implementation steps, and resources need to implement
based upon the Planning Committee consensus.

Each participating jurisdiction, including the City of
Vallejo, considered ongoing relevancy of mitigation
actions from the existing MJHMP and retained or
removed such actions while adding new relevant
actions as well. Mitigation actions were examined for
relevancy and the potential for future implementation
and then evaluated for potential follow-up. Some
mitigation actions developed during the previous HMP
effort were not included because they were an inherent
part of the HMP update process or were not detailed
enough for implementation at a local Jurisdiction level. the City of Vallejo has made significant changes to other mitigation actions because of the updated risk
assessment and implementation strategy, to include
more detail, or to update based on current mitigation practices. Volume 1, Section 5.5.2 provides a record of County wide mitigation actions, the status, and additional notes for each action.

Table 7-13 lists each mitigation action for the City of Vallejo. Each participating jurisdiction developed unique mitigation actions, targeted at their own unique priorities and vulnerabilities. Each mitigation action identifies the responsible party, time frame, potential funding source, implementation steps and resources needed to implement these priority mitigation actions. As a living document, hazard problem statements and mitigation activities will be updated through MAST. The detail in Table 7-13 meets the regulatory requirements of FEMA and DMA 2000.

Figure 7-15: Mitigation Action Key
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Table 7-13: City of Vallejo Mitigation Actions
Mitigation No. Hazard
Type
Mitigation
Type
Status Year Primary
Agency
Title/Description Responsible
Party
Estimated Cost Estimated Benefit Time
Frame
HMA
Activity
Type
Potential Grant
Source
Priority Related
Goal(s)
Related
Problem
Statements
ma-EW-VL-158 All Hazard PRV -
Prevention
Pending 2021 City of
Vallejo
Implement a defensible space
assessment, including for key
wind corridors or areas more
susceptible to wildfire carried by
extreme wind.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.

Annually Project HMGP / BRIC High Goal 1: People ,
Goal 2:

Infrastructure ,
Goal 4:

Resilience
ps-EW-VL-77,
ps-WF-VL-60,
ps-WF-VL-63
ma-CC-VL-203 Climate
Change
PRV -
Prevention
Ongoing 2021 City of
Vallejo
Incorporate consideration of sea
level rise into the City’s Capital
Improvement Program, and into
the design and funding of
infrastructure in places of higher
risk such as Mare Island.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
1-3 Years Planning HMGP / BRIC ,
FMA
High Goal 4:

Resilience
ps-CC-VL-181
ma-DR-VL-149 Drought PRV -
Prevention
Pending 2021 City of
Vallejo
Replace irrigated landscaping
with drought resistant vegetation
and increase use of recycled
water for irrigation.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
3-5 Years Project HMGP / BRIC High Goal 3:

Environment ,
Goal 4:

Resilience
ps-DR-VL-74
ma-EQ-VL-150 Earthquake PRV -
Prevention
Pending 2021 City of
Vallejo
Draft natural gas shut-off valve
ordinance.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
1-3 Years Planning HMGP / BRIC High Goal 1: People ,
Goal 2:

Infrastructure
ps-EQ-VL-64
ma-EQ-VL-151 Earthquake SP -
Structural
Projects
Pending 2021 City of
Vallejo
Install seismic shut-off valves on
gas fixtures on City-owned
critical facilities and lines.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
1-3 Years Project HMGP / BRIC High Goal 2:

Infrastructure
ps-EQ-VL-65
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Mitigation No. Hazard
Type
Mitigation
Type
Status Year Primary
Agency
Title/Description Responsible
Party
Estimated Cost Estimated Benefit Time
Frame
HMA
Activity
Type
Potential Grant
Source
Priority Related
Goal(s)
Related
Problem
Statements
ma-EQ-VL-152 Earthquake SP -
Structural
Projects
Pending 2021 City of
Vallejo
Conduct seismic retrofits of cityowned buildings and
infrastructure, and reinforce soil
to withstand liquefaction near
vulnerable facilities on ground
with very high liquefaction
potential.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.

Annually Project HMGP / BRIC High Goal 2:

Infrastructure
ps-EQ-VL-66,
ps-EQ-VL-68,
ps-EQ-VL-69
ma-EQ-VL-153 Earthquake PRV -
Prevention
Pending 2021 City of
Vallejo
Update the Emergency Action
Plans for dams throughout the
City of Vallejo.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
1-3 Years Planning HMGP / BRIC High Goal 1: People ,
Goal 2:

Infrastructure ,
Goal 4:

Resilience
ps-EQ-VL-67
ma-EQ-VL-154 Earthquake SP -
Structural
Projects
Pending 2021 City of
Vallejo
Retrofit water storage facilities to
withstand seismic events
City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
1-3 Years Project HMGP / BRIC High Goal 2:

Infrastructure
ps-EQ-VL-70
ma-EQ-VL-155 Earthquake PE&A -
Public
Education &
Awareness
Pending 2021 City of
Vallejo
Conduct public education
campaign on earthquake
preparedness and seismic
housing retrofits.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.

Annually Planning HMGP / BRIC Medium Goal 1: People ,
Goal 4:

Resilience
ps-EQ-VL-71,
ps-EQ-VL-72,
ps-EQ-VL-73
ma-EW-VL-156 Extreme
Weather
ES -
Emergency
Services
Pending 2021 City of
Vallejo
Construct backup generators at
critical facilities (city pump
stations) to prepare for loss of
power from PSPS high wind
events.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
1-3 Years Project HMGP / BRIC High Goal 2:

Infrastructure
ps-EW-VL-75
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Mitigation No. Hazard
Type
Mitigation
Type
Status Year Primary
Agency
Title/Description Responsible
Party
Estimated Cost Estimated Benefit Time
Frame
HMA
Activity
Type
Potential Grant
Source
Priority Related
Goal(s)
Related
Problem
Statements
ma-FL-VL-157 Extreme
Weather
SP -
Structural
Projects
Pending 2021 City of
Vallejo
Reinforce drainage systems from
flooding through protection
activities, including elevating City
infrastructure and roads,
installing culverts beneath roads
or building a higher bridge across
areas that experiences regular
flooding.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
3-5 Years Project HMGP / BRIC Medium Goal 2:

Infrastructure
ps-EW-VL-76
ma-EW-VL-159 Extreme
Weather
PRV -
Prevention
Pending 2021 City of
Vallejo
Replace dying or dead evergreen
vegetation with wind resistant
vegetation and implement annual
tree trimming program.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.

Annually Project HMGP / BRIC High Goal 2:

Infrastructure ,
Goal 3:

Environment
ps-EW-VL-78
ma-WF-VL-160 Wildfire PE&A -
Public
Education &
Awareness
Pending 2021 City of
Vallejo
Conduct public education
campaign on wildfire
preparedness and defensible
space measures for people living
in moderate wildfire risk areas of
Vallejo.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.
1-3 Years Planning HMGP / BRIC High Goal 1: People ,
Goal 4:

Resilience
ps-WF-VL-61,
ps-WF-VL-62
ma-WF-VL-161 Wildfire PRV -
Prevention
Pending 2021 City of
Vallejo
Implement annual fuel reduction
program for city-owned open
spaces, including Waterfront Park
and Don Hunts park.

City of
Vallejo
Medium - The project could
be implemented with
existing funding but would
require a re-apportionment
of the budget or a budget
amendment, or the cost of
the project would have to be
spread over multiple years.

High - Project will provide
an immediate reduction of
risk exposure for life and
property.

Annually Project HMGP / BRIC High Goal 3:

Environment ,
Goal 4:

Resilience
ps-WF-VL-63
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U.S. Department of Homeland Security
FEMA Region 9
1111 Broadway, Suite 1200
Oakland, CA 94607-4052
www.fema.gov
December 16, 2021
Don Ryan
Director
Solano County Office of Emergency Services
530 Clay St.

Fairfield, CA 94533
Dear Mr. Ryan:

The Federal Emergency Management Agency (FEMA) has completed its review of the Solano County 2021 Multi-Jurisdictional Hazard Mitigation Plan and has determined that this plan is eligible for final approval pending its adoption by Solano County and all participating jurisdictions. Please see the enclosed list of approvable pending adoption jurisdictions.

Formal adoption documentation must be submitted to FEMA Region 9 by at least one participating jurisdiction within one calendar year of the date of this letter, or the entire plan must be updated and resubmitted for review. FEMA will approve the plan upon receipt of the documentation of formal adoption.

Once the plan is approved, each participating jurisdiction must adopt the plan within five calendar years of the date of the approval. The adoption of the plan by each jurisdiction ensures that jurisdiction’s continued eligibility for funding under FEMA’s Hazard Mitigation Assistance (HMA) programs. All requests for funding, however, will be evaluated individually according to the specific eligibility, and other requirements of the particular program under which applications are submitted.

If you have any questions regarding the planning or review processes, please contact the FEMA Region 9 Hazard Mitigation Planning Team at [email protected].

Sincerely,
for Alison Kearns
Risk Analysis Branch Chief
Mitigation Division
FEMA Region 9
Enclosure (2)
Solano County Plan Review Tool, dated December 16, 2021 Status of Participating Jurisdictions, dated December 16, 2021 cc: Mark Shugart, Acting Risk Analysis Branch Chief, FEMA Victoria LaMar-Haas, Hazard Mitigation Planning Chief, California Governor’s Office of Emergency Services
Jennifer Hogan, State Hazard Mitigation Officer, California Governor’s Office of Emergency Services
Solano County 2021 Multi-Jurisdictional Hazard Mitigation Plan APA Notice December 16, 2021

www.fema.gov
Status of Participating Jurisdictions as of December 16, 2021 Jurisdictions – Adopted and Approved
# Jurisdiction Date of Adoption
Jurisdictions – Approvable Pending Adoption
# Jurisdiction
1 Solano County
2 Benicia, City of
3 Dixon, City of
4 Fairfield, City of
5 Rio Vista, City of
6 Suisun City, City of
7 Vacaville, City of
8 Vallejo, City of
9 Vallejo Flood and Wastewater District
RESOLUTION NO. 22- ___

RESOLUTION OF THE CITY OF COUNCIL OF THE CITY OF VALLEJO

ADOPTING THE SOLANO COUNTY MULTI-JURISDICTION

HAZARDOUS MITIGATION PLAN
WHEREAS, the City of Vallejo (“City”) is an official participating jurisdiction in the Solano County Multi-Jurisdiction Hazard Mitigation Plan (“MJHMP”); and WHEREAS, the City recognizes the MJHMP as the official hazard mitigation plan for participating jurisdictions; and
WHEREAS, the City has gathered information and prepared the MJHMP in accordance with Federal Emergency Management Agency (FEMA) requirements at 44 CFR § 201.6; and
WHEREAS, Volume 1 of the MJHMP recognizes the threat that natural hazards pose to people and property throughout Solano County; and
WHEREAS, the City’s Annex to Volume 1 of the MJHMP provides additional information specific to the City with a focus on providing additional details on the planning process, risk assessment, and mitigation strategy for this community; and WHEREAS, the City has reviewed Volume 1 of the MJHMP and its Annex and affirms that the plan actions in Volume 1 and its Annex should reduce the potential for harm to people and property from future hazard occurrences within the community; and WHEREAS, the Disaster Mitigation Act of 2000 (the “Act”) emphasizes the need for predisaster mitigation of potential hazards; and WHEREAS, the Act makes available mitigation grants to state and local governments; and
WHEREAS, an adopted hazard mitigation plan is required as a condition of future funding for mitigation projects under multiple FEMA pre- and post-disaster mitigation grant programs; and
WHEREAS, the City fully participated in the FEMA-prescribed mitigation planning process to prepare this MJHMP; and
WHEREAS, the residents were afforded opportunities to comment and provide input in the MJHMP and the mitigation actions in the Plan; and
WHEREAS, the City, as a fully participating jurisdiction of the MJHMP, is an eligible sub-applicant to the State of California under FEMA’s hazard mitigation grant program guidance; and
WHEREAS, the California Office of Emergency Services (Cal OES), and the FEMA Region IX officials have reviewed the MJHMP and have approved it contingent upon this official adoption by the participating governing body; and WHEREAS, the City desires to comply with the requirements of the Act and to augment its emergency planning efforts by formally adopting the MJHMP; and WHEREAS, adoption by the City Council demonstrates the jurisdiction’s commitment to fulfilling the mitigation goals and objectives outlined in this MJHMP; and WHEREAS, adoption of this plan helps to coordinate the responsible agencies to carry out their responsibilities under the MJHMP.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Vallejo does hereby resolve as follows:

Section 1. The Recitals set forth above are true and correct and are incorporated into this Resolution by reference.

Section 2. The City Council has jurisdiction to consider, approve, and adopt the subject of this Resolution.

Section 3. The City Council hereby adopts the Solano County Multi-Jurisdictional Hazard Mitigation Plan Volume 1 and its Annex, as approved by FEMA and the California Office of Emergency Services, as the official mitigation plan for the City of Vallejo.

Section 4. The City Council hereby authorizes the County of Solano Emergency Services Manager to submit an approved and signed copy of this Resolution to the California Office of Emergency Services and to FEMA Region IX officials for the plan’s final approval in accordance with the requirements of the Disaster Mitigation Act of 2000.

Adopted by the City Council of the City of Vallejo at a regular meeting held on March 22, 2022 with the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
________________________________

ROBERT MCCONNELL, MAYOR
________________________________
DAWN G. ABRAHAMSON, CITY CLERK
Passed:

Date
Certifying Official
ACTION ITEM 9.B.

DATE: March 22, 2022
TO: Mayor and Members of the City Council
FROM: Gillian Hayes, Interim Assistant City Manager
Paul Kelley, Special Advisor to City Manager, Economic Development Manager SUBJECT: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND APPROVING

AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL ENVIRONMENTAL IMPACT

STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE

ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE

ISLAND DISPOSITION AND DEVELOPMENT AGREEMENT BETWEEN THE CITY OF

VALLEJO AND THE NIMITZ GROUP LLC AND AUTHORIZING THE CITY MANAGER TO

EXECUTE SAME AND ANY AND ALL OTHER DOCUMENTS NECESSARY TO

EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH

AMENDMENT TO THE EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE

NIMITZ GROUP, LLC FOR THE PROPERTY

RECOMMENDATION
Adopt resolutions:

1. Declaring the North Mare Island Property - APNs 0066-020-130 and 0066-020-140 and portions of 0066-020-110 and 0066-020-150 - (Property) as Surplus Property Exempt from the Provisions of AB 1486 pursuant to Government Code Section 54234(a)(1) and Making CEQA Findings of Exemption.

2. Making CEQA Findings and Approving an Addendum to the Previously Certified Final Environmental Impact Statement / Environmental Impact Report (EIS/EIR) for the disposal and reuse of Mare Island Naval Shipyard Project (1998) and the Mare Island Amended and Restated Specific Plan Project Final Subsequent Environmental Impact Report (2005).

3. Approving the North Mare Island Disposition and Development Agreement between the City of Vallejo and The Nimitz Group, LLC and Authorizing the City Manager to Execute Same and any and all Other Documents Necessary to Effectuate the Purchase and Sale of the Property and the Sublease of the Navy Property.

Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

4. Authorizing execution of the Seventh Amendment to the Exclusive Negotiation Agreement (ENA) with The Nimitz Group, LLC for the Property.

REASONS FOR RECOMMENDATION

1. Purchase and Sale of the Property requires that the Property be listed on the City’s Surplus Property List in accordance with California Government Code Section 54220 et seq. (Surplus Lands Act). In accordance with amendments to the Surplus Lands Act approved in 2019 and effective in January of 2020, surplus lands of any city must be declared as Surplus or Exempt Surplus prior to disposition.

2. Approval of the North Mare Island (NMI) Disposition and Development Agreement (DDA) is a discretionary action subject to the California Environmental Quality Act (CEQA). The project was reviewed in compliance with the requirements of CEQA and the CEQA Guidelines and it was determined in accordance with CEQA Sections 21166 and CEQA Guidelines Section 15162, 15164, and 15168 that an Addendum to the previously certified Final Environmental Impact Statement / Environmental Impact Report (EIS/EIR) for the Disposal and Reuse of Mare Island Naval Shipyard Project (1998) and Addendum (1999), and the Mare Island amended and restated Specific Plan Project Final Subsequent Environmental Impact Report (2005) (Collectively, Previously Certified Environmental Documents as the appropriate environmental document for the North Mare Island Disposition and Development Agreement and Implementation Project and finding that the development-related activities described in the proposed DDA are within the scope of the development program described and evaluated in the Previoisly Certified Environmental Documents.

3. Approval of the North Mare Island (NMI) Disposition and Development Agreement (DDA) for the sale and lease of the Property to the Nimitz Group, LLC (Nimitz) will allow for Development of the Property in accordance with the terms of the DDA. The DDA shifts the City’s ongoing costs of NMI ownership and all pre-development costs to Nimitz, eliminates the City’s ongoing HUD loan payments, and creates the opportunity for both the South Mare Island (South Island) and the Property to be developed under a new, more robust, potential future Specific Plan.

Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

4. Execution of the Seventh Amendment to the Exclusive Negotiation Agreement (ENA) with Nimitz for the Property will provide additional time for Nimitz and the City to finalize and execute the DDA and ancillary documents and to reach close of escrow prior to the end of the year. Given the expiration date of the Sixth Amendment to the DDA of March 31, 2022, it is necessary to extend the ENA to address any delays that may occur with the closing of the land transactions.

BACKGROUND AND DISCUSSION
Property Ownership
The City is the fee owner of approximately 125.3 acres on North Mare Island located within Reuse Area 1-A and the lessee of approximately 31.8 acres within Reuse Area 1-A still owned by United States Department of the Navy (Navy Property) and leased to the City per a Lease in Furtherance of Conveyance (LIFOC) dated September 30, 1999.

History and Timeline
In July 1993, the Mare Island Naval Shipyard (Mare Island) was ordered closed pursuant to the Defense Base Closure and Realignment Act of 1990, as amended.

On July 26, 1994, City approved a Final Reuse Plan (“Reuse Plan”) for Mare Island that established goals for the reuse of Mare Island, including the creation of jobs and other economic development opportunities within the City, the creation of a self-sustaining and multi-use community, and the use of a variety of innovative economic development tools for the marketing, financing and acquisition of Mare Island following its closure by the federal government.

In connection with the approval of the Reuse Plan, the City Council on November 17, 1998, certified a final Environmental Impact Statement/Environmental Impact Report (SCH #940930029) (“EIS/EIR”) pursuant to the Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

California Environmental Quality Act (California Public Resources Code Section 21000 et seq.) (“CEQA”) and the federal government, acting by and through the Secretary of the United States Department of the Navy (“Navy”), issued a Record of Decision pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. §§4321 4347 (“NEPA”).

On or about March 30, 1999, the City adopted a Mare Island Specific Plan governing the land use policy and development process for Mare Island.

On September 30, 1999, the City and the Navy entered into the LIFOC, anticipating that following the Navy’s completion of remediation activities and issuance of one or more additional Findings of Suitability for Transfer, the property subject to the LIFOC would be conveyed to the City.

On December 21, 1999, the City entered into an Acquisition Agreement with Lennar Mare Island LLC, (Lennar) to transfer portions of Mare Island to Lennar from the City upon transfer of said property to the City from the United States (Acquisition Agreement). The Acquisition Agreement was amended on September 20, 2000, January 31, 2001, March 23, 2001, May 24, 2001, August 28, 2001, September 30, 2001, November 30, 2001, January 15, 2002, February 26, 2002, and finally in 2004.

On November 29, 2005, in connection with City’s adoption of the Amended and Restated Mare Island Specific Plan, the City certified a final Subsequent Environment Impact Report (SCH #2004092057) (“SEIR”). The SEIR identified and analyzed the significant impacts associated with the incremental change in intensity and distribution of land uses on Mare Island as compared to those described in the prior specific plan as originally adopted in 1999.

On or about December 6, 2005, the City amended the Mare Island Specific Plan by adopting the Amended and Restated Mare Island Specific Plan.

In July 2007, an Addendum to the SEIR was prepared. The 2007 Addendum addressed proposed amendments to policies in the Amended and Restated Mare Island Specific Plan and the Vallejo Municipal Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

Code related to historic resources on Mare Island.

The City further amended the Amended and Restated Mare Island Specific Plan in July 2007, June 2008, June 2013, August 2013 and June 2017.

In early 2018, the City of Vallejo issued a Request for Qualifications (RFQ) for the development of the City’s 157-acres on North Mare Island.

On May 15, 2018, Council directed staff to negotiate an Exclusive Right to Negotiate Agreement (ENA)with Nimitz with respect to the 157-acre North Mare Island property.

On July 24, 2018, Council authorized the City Manager to execute the ENA with Nimitz under which the parties would negotiate a proposed DDA providing for the City’s conveyance of North Mare Island to Nimitz for development.

In addition to the North Mare Island negotiations, Nimitz was working with Lennar on a proposed Purchase and Sale Agreement pursuant to which Nimitz would purchase the remaining property owned by Lennar on Mare Island, herein referred to as “South Island.”
On July 31, 2019, Council approved a Consent Agreement for the Transfer of Lennar’s South Island property to Nimitz. Concurrently, the Council approved a Fourth Amended and Restated ENA for North Mare Island which identified the negotiation and execution of an initial ground lease and a Purchase Option Agreement as the goal of the City/Nimitz negotiations.

On October 22, 2019, Council approved an initial Term Sheet for North Mare Island and directed staff and Nimitz to continue to work diligently toward finalizing the agreement.

In November 2019, Nimitz closed escrow for the acquisition of South Island from Lennar and assumed the role of Mare Island Master Developer.

Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

In Early 2020, Nimitz contracted with Southern Land Company (SLC) to act as the lead land manager for Mare Island. SLC determined, based on in-depth analysis of the pre-development costs including the geologic hazards and geotechnical challenges of the North Mare Island property (further discussed, below), that a substantial amount of soil importation would be required to raise the site grades, dramatically increasing NMI development costs and delaying vertical development.

On December 15, 2020, staff presented a Fifth Amended and Restated ENA for North Mare Island which included a new Term Sheet to address the additional soil importation and land preparation costs. Council approved the Fifth Amended and Restated ENA and new Term Sheet and directed staff and Nimitz to continue to work on the drafting of the North Mare Island DDA.

After the execution of the Fifth Amended and Restated ENA for North Mare Island and new Term Sheet, staff began the task of environmental review for the North Mare Island Disposition and Development Agreement and Implementation Project.

On December 14, 2021, Council approved the Sixth Amendment to the ENA which extended the term 90 days through March 31, 2022 to allow additional time needed to finalize negotiations on the remaining DDA terms.

Staff has been working to prepare the DDA and related documents for review and consideration by the Council. At Council’s request, the Draft DDA, North Mare Island Term Sheet Comparison Matrix, FAQs Document and CEQA Addendum were released and posted on the City’s website for public review on February 22, 2022. At the time of this writing, the website has received 312 interactions and 199 subscribers. Additionally, though not legally required, a 10-day meeting notice was mailed to property owners within 500 feet of the project site on March 10, 2022 and published in the Times Herald on March 12, 2022.

State Surplus Lands Act Requirements
In 2019, the Legislature passed AB 1486 (Ting) amending various provisions of the Surplus Land Act (SLA), Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

which among other things, requires public agencies to notice and offer surplus public land for affordable housing prior to disposition of such lands for other public purposes. The SLA is monitored by the California Department of Housing and Community Development (HCD). HCD has published Surplus Land Act Guidelines to assist public agencies with compliance with the SLA as amended by AB 1486.

The SLA includes an exemption particularly described in Government Code Section 54234(a)(1) that applies to land which is the subject of an exclusive negotiating agreement entered into before September 30, 2019, which provides that such land is not subject to the 2019 amendments to the SLA. More specifically, Government Code section 54234(a)(1) states:

If a local agency, as of September 30, 2019, has entered into an exclusive negotiating agreement or legally binding agreement to dispose of property, the provisions of this article as it existed on December 31, 2019, shall apply, without regard to the changes made to this article by the act adding this section, to the disposition of the property to the party that had entered into such agreement or its successors or assigns, provided the disposition is completed not later than December 31, 2022.

The North Mare Island ENA was entered into prior to September 30, 2019 – thereby complying with the first element of Section 54234(a)(1). The ENA has been sent to HCD as the HCD process requires. The DDA, if approved, contemplates disposition of the North Mare Island Property prior to December 31, 2022. If the City approves the Resolutions before the Council, including Attachment 6, the Resolution Declaring the North Mare Island Property as Exempt Surplus Property, the City will communicate proof of the disposition having occurred prior to December 31, 2022 to HCD.

Term Sheet and DDA Comparison
As noted above, two term sheets have been prepared for the proposed DDA, one in 2019 and one in 2020. As staff moved forward with drafting the DDA and preparing the requisite CEQA review, it became apparent that some of the items contemplated in the Term Sheets needed to be included as potential future items for consideration in connection with the potential approval of the new Specific Plan. Additionally, new Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

requirements were added to the DDA in an effort to move the development timeline for the Connolly Corridor forward and to capture future potential value of the North Mare Island Property. A comparison matrix of the key agreement terms and the differences between the 2019 and 2020 Term Sheets and the draft DDA is attached hereto as Attachment 3.

The Draft DDA Substantive Provisions
The draft DDA includes many provisions designed to both facilitate the sale of the North Mare Island Property as well as ensure public benefits are actually achieved within a reasonable period of time.

Below is a discussion of some of the key provisions of the draft DDA. In addition, staff has prepared a Frequently Asked Questions (FAQs) Document to address some of the public questions that have been asked over the last few months, attached hereto as Attachment 4.

With the City Council approval of this DDA, Nimitz/SLC can immediately escalate the specific planning and pre-development work which will enable Nimitz to invest in the property and move forward with site preparation and the future development of North Mare Island.

Key Provisions of DDA
The following is a summary of some of the key provisions of the DDA. A full and complete copy of the Draft DDA and all of its exhibits is included as Attachment 1. A copy of the pages with changes made to the Draft DDA since posting thereof on the City's website on February 22, 2022 is included in redline format as Attachment 11.

Local Economics Benefit Program (Exhibit M)
As detailed in the Local Economics Benefit Program Requirements (DDA Exhibit M), Nimitz is to comply with the program requirements regarding job creation, work force development and inclusion of minority, women Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

and locally owned businesses and enterprises. As part of this compliance, Nimitz is to submit an annual report to the City including data on locally owned business enterprises that have received contracts, the number of local residents hired for development work, and information on anticipated contracting and employment opportunities.

Payment in Lieu of Property Taxes (Section 310 and Exhibit H) Due to the uncertainty as to when market conditions will support vertical development and given the length of time it will take to import fill to raise the elevation of North Mare Island and complete surcharging, the DDA includes an incentive for Nimitz to move forward with development by obligating Nimitz to pay to the City and the Vallejo Unified School District beginning in year 5 and continuing each year thereafter a “payment in lieu of property taxes” (PILOT). This payment would be equal to what the City and the School District would have received if Nimitz had moved forward with at least $26 Million (in 2020/21 dollars) of private development on the portions of Mare Island owned or controlled by Nimitz (including both South and North Island). This payment would end when Nimitz has completed development with an assessed value of at least $26 Million Island-wide (in 2020/21 dollars).

Additional Payments for Added Development beyond Specific Plan Densities (Section 204.3) Additional payments to the City may be required to be made by Nimitz if, following approval, if any, of a New Specific Plan, Nimitz or its successors obtain approval to increase the permitted density of any portion of Mare Island and such increase results in more development than identified in the New Specific Plan as approved by City.

Nimitz will be required to make any such additional payments to the City following a future agreed upon methodology, which methodology will be determined at the time of approval of any proposed New Specific Plan, Backbone Infrastructure Plan and any new, revised, amended or extended Development Agreement relating to any portion of Mare Island. If the parties cannot agree on such methodology at that time, the City in its sole discretion may disapprove any proposed New Specific Plan, Backbone Infrastructure Plan, and any Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

proposed new, revised, amended or extended Development Agreement on any portion of Mare Island.

Connolly Corridor Development Work (Section 301 and Exhibit C) Nimitz to construct and develop the Connolly Corridor Development site, a major mixed-use commercial development on South Island, within 60 months following initial closing.

Building 571 Remediation Work (Section 210 and Exhibit S) During the performance of due diligence work, Nimitz discovered that during the demolition of Building 571, PCB contaminated debris appears to have been spread over the Building 571 site. The City intends to begin remediation plan work prior to the close of escrow for the initial transfer and to complete the remediation work at City's expense (with the exception of the importation of clean fill). The cost of this work is estimated to be in the range of $400K to $650K. City will retain rights to any sums that may be recovered from persons or entities responsible for the contamination.

CFD Annexation (Section 309)
Nimitz will assume all CFD payments upon the initial transfer, after which Nimitz will cooperate with City to explore the formation of a new island-wide services CFD to replace the existing CFDs. If City moves forward with a new CFD, Nimitz will agree to participate. If no new CFD is formed then, after conveyance of the Navy's ~32 acres to the City, Nimitz will annex the Navy lands into the existing CFDs.

Utility Maintenance and Ownership Responsibilities
Irrevocable Offers to dedicate Roadways (Section 311 and Exhibit N) After the initial transfer, Nimitz will own the roadways within North Mare Island excluding those on the Navyowned land. Roadways located on the Navy-Owned Land will be included in the Sublease between the City Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

and Nimitz which addresses the maintenance responsibility on the Navy-Owned Land. The City will have the option, but not the obligation, to accept dedication of the roadways pursuant to Nimit'z irrevocable offer of dedication as shown in Exhibit N to the DDA. Prior to acceptance, if any, Nimitz will be obligated to maintain all roadways in a safe and usable condition and to ensure the Roadways remain open and accessible for use by the general public. Nimitz will also bear all costs and liabilities related to the operation and maintenance of the roadways until the City accepts the offer of dedication or until Nimitz develops North Mare Island, performs the necessary improvements to streets, and the City accepts such improvements and the offer of dedication.

Reimbursement Agreement for Water and Sewer/Storm Infrastructure (Section 318 and Exhibits O and R) The transfer of North Mare Island will initially exclude the water, sewer and storm systems, as the City and Vallejo Flood and Wastewater (VFWD), respectively, must maintain ownership of these systems. However, Nimitz has agreed to reimburse the City for the water operations and maintenance and repair costs and VFWD for sewer and storm system repair and maintenance costs until such time as Nimitz has upgraded and/or replaced the existing systems and the City and VFWD have accepted them.

Sales Tax – Point of Sale (Section 313)
Contractors and subcontractors with contracts valued at $5M or more will designate North Mare Island as the place of use to ensure that the local portion of sales and use tax from the construction and development of North Mare Island will be distributed directly to the City rather than through the County-wide pool which will result in the City receiving a greater share of such taxes.

Limitations on Development under Existing Specific Plan (Section 315) In order to incentivize Nimitz to obtain a new Specific Plan for the Island, the DDA includes the following limitations on development until such new Specific Plan is adopted:

Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

1. The following uses will be prohibited on NMI: LNG facilities, cement batch plants, dumps and heavy recycling facilities, refineries, heavy industrial uses, and cannabis cultivation and dispensary facilities.

2. Development on South Mare Island will be limited to the Connolly Corridor Development Work and the subdivision of parcels for Buildings 45, 65 and 459 (Savage & Cook development).

City Option to Repurchase or Reposes (Section 806)
If Nimitz defaults any provision of the DDA, the City has the option to repurchase, reenter, and take possession of North Mare Island. To exercise this option, City would be obligated to reimburse Nimitz the $3M purchase price plus verified out-of-pocket hard costs incurred by Nimitz for Demolition Work, Site Preparation Work and construction of permitted improvements, not to exceed $10M.

Right of First Offer (Section 1025)
Prior to the City’s issuance of the Certificate of Completion for all of Developer's work under the DDA, if Nimitz intends to sell more than 20% of North Mare Island to an unaffiliated third-party, Nimitz is to provide the City with the option to purchase such property at the proposed purchase price and under the same terms and conditions given to the third party. City has 90 days to agree to purchase the property at the as is price.

New Island-Wide Specific Plan and Backbone Infrastructure Plan (Section 301, Exhibits C and D) Per the terms of the North Mare Island DDA, Nimitz has committed to submit a new proposed Mare Island Specific Plan including a Backbone Infrastructure Plan for the Island within 24 months of the DDA’s execution. The new proposed uses are anticipated to require even greater investments in terms of soil preparation and backbone infrastructure than current estimates. Any new proposed Mare Island Specific Plan is subject to future required public hearings and may be approved or denied by the City in accordance with Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

applicable law.

Navy Property Sublease and Must Take Obligation (Recital I, Exhibit E) An approximately 31.8-acre portion of Reuse Area 1-A is currently owned by the United States Navy (the “Navy-Owned Property”) and leased to the City pursuant to a Lease in Furtherance of Conveyance (LIFOC) dated September 30, 1999. City and Navy anticipate that following Navy’s completion of remediation activities and issuance of one or more additional Findings of Suitability for Transfer, the Navy-Owned Property will be conveyed by Navy to City via one or more further quitclaim deeds. Following the closing of the purchase of the North Mare Island Property by Nimitz, Nimitz will have a “must-take obligation” to accept from City the fee title to the Navy-Owned Property as and when the Navy-Owned Property, or applicable portion thereof, is acquired by City immediately following City’s acceptance of such property from Navy.

Timing of the Obligations
Nimitz’s Main Obligations Prior to Initial Transfer of 125 acres

1. Payment of the $3,000,000 purchase price to be paid at initial closing. City will apply these funds to the outstanding HUD loan, which balance is estimated currently at ~ $2.3 Million.

2. Submission of applications to the City for demolition permits for remaining North Mare Island nonutilized buildings.

3. Submission to the Navy and receipt of Navy approval of Project Environmental Review Form (PERF) that is required to perform demolition work on the Navy-Owner Property.

4. Execution of a demolition agreement.

5. Posting of demolition work performance or completion bonds.

Nimitz’s Main Obligations following Transfer
Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

Following the initial transfer, but prior to the City issuance of a Certificate of Completion, Nimitz is obligated to complete the below defined “Developer’s Work” within the times detailed in the Schedule of Performance (DDA Exhibit D). Any change to the Schedule must be agreed to in writing by City Manager. Developer’s Work includes the following:

1. Demolition Work - Nimitz to demolish the remaining 10 non-utilized, non-historic buildings on NMI within 24 months following initial closing. The City’s estimated cost to demolish these remaining facilities is approximately $2M+.

2. Connolly Corridor Development Work - Nimitz to construct and develop the Connolly Corridor Development site, a major mixed-use commercial development on South Island, within 60 months following Initial Closing.

3. Planning Work / New Specific Plan - Nimitz to submit to City for consideration and potential approval of a new Specific Plan for the entire Island. The new Specific Plan will address the phased installation and construction of new backbone infrastructure to serve new development and redevelopment of property on Mare Island. Nimitz to submit a new proposed Specific Plan to the City within 24 months following initial closing. The City has no obligation to approve this new Specific Plan and the proposed new Specific Plan will undergo environmental review and public hearings prior to consideration of approval, if any.

4. Beautification Work - Nimitz to submit to City for Consideration and potential approval a proposed Beautification Plan within 8 months following initial closing. This Plan is to include interim landscaping, hardscaping, enhanced fencing, lighting and security which may include elements such as trees and flowers, public seating, and public art. The first phase of the Beautification Work, which will be focused on the Causeway Bridge and Highway 37 entry points, would have to be installed within 8 months following Beautification Plan approval. The second phase, consisting of work on the remaining key areas of Mare Island, including North Mare Island, would have to be installed within 24 months of following Beautification Plan approval. The City has no obligation to approve this Beautification Plan and the proposed Beautification Plan will undergo environmental review and public hearings prior to consideration of approval, if any.

Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

5. Site Preparation Work
Soil Testing: Nimitz to perform soil testing of existing soil stockpiles within 12 months following initial closing to determine if such existing stockpiles are suitable for use.

Site Preparation Work: In the event the City approves a new Specific Plan and the environmental review related thereto, Nimitz will use commercially reasonable and diligent efforts to commence and complete importation of clean fill suitable for development of North Mare Island consistent with the New Specific Plan, estimated to be approximately two million cubic yards. Nimitz is to report to the City annually on its progress in obtaining such clean fill and, if substantial progress in clean fill importation has not been made, provide an explanation as to why the clean fill was not obtained.

6. Must Take Obligations of the Navy Property
Following the Closing of the Purchase of the Property by Nimitz, Nimitz will have a “must-take obligation” to accept from City the fee title to the Navy-Owned Property immediately following City’s acceptance of such property from the Navy.

NMI DDA - Economic Benefits
The North Mare Island DDA provides substantial economic benefits to the City including the elimination of approximately $413,000 in annual costs as detailed below:
 Eliminates City’s Public Works street maintenance, repairs and illegal dumping removal costs on North Mare Island (approximately $12,000/year)
 Eliminates City’s North Mare Island CFD payments (approximately $85,000 in FY21/22)  Eliminates City’s security costs for North Mare Island (approximately $50,000/year)  Reimburses City’s Water Department maintenance and repair costs (approximately $30,000/year) Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

 Provides a $3M purchase price payment to City that will enable the City to pay off the approximately $2.3M HUD loan, relieving the City’s General Fund of all future HUD payments (approximately $236,000/year)
Additional economic and public benefits to the City include the following:
 Transfers the responsibility of demolishing the remaining non-utilized buildings on North Mare Island to Nimitz (Estimated at $2M+)
 Nimitz to continue providing security to North Mare Island at no cost to City  Commits Nimitz to make payments in lieu of taxes for the City and School portion of property tax, to the City and School District starting in year 5 if development on the Island does not create an additional $26M in property tax assessed value
 Limits development under the existing outdated Specific Plan until a new plan is reviewed and possibly approved
 Accelerates specific plan and backbone infrastructure planning and planning for interim beautification improvements
 Accelerates development of the Connolly Corridor to occur within 60 months after initial closing on the North Mare Island Property purchase
 If the interim Beautification Plan is approved by City, Nimitz will construct improvements which Enhance attractiveness of key entry points onto Mare Island  The DDA commits the developer to ensure contracts over $5 million obtain a local sales tax/use tax permit to ensure that sales/use taxes are allocated directly to City rather than through the Countywide pool which will result in City receiving a greater share of such taxes  Nimitz is to comply with the program and reporting requirements in Exhibit M (Local Economic Benefit Program Requirements) regarding job creation, work force development and inclusion of minority, women and locally owned businesses and enterprises.  Requires Nimitz to assume all CFD payments at initial transfer. Following the initial closing Nimitz will cooperate with City to explore formation of a new Island-wide services CFD to replace the Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

existing CFDs. If City moves forward with a new CFD, Nimitz must agree to participate. If no new CFD is formed, then, after conveyance of Navy's ~32 acres, Nimitz will annex the Navy lands into the existing CFDs.

The DDA also commits Nimitz to prepare a new Specific Plan for the Island including a Backbone Infrastructure Plan within 24 months of initial closing.

Nimitz, SLC Progress to Date
Showing its commitment, Nimitz has already moved forward on some of the key terms of the DDA including the following:
 Development of planning concepts and descriptions to facilitate the CEQA review for the DDA and the Connolly Corridor Development, the first major mixed-use commercial development on South Island under the current Specific Plan.
 CEQA review for the demolition of North Mare Island non-utilized buildings.  Implementation of security patrols on North Mare Island.  Installation of security fencing on North Mare Island.  Commencement of planning and visioning efforts for a new Specific Plan which, if approved by City, could potentially expand the range of permitted uses currently contemplated for NMI under the existing Specific Plan.
 Initiated review of existing soil stockpiles on Mare Island for reuse.  Initiated North Mare Island environmental analysis including review of existing environmental cleanup documents.
 Selection of Landscape Architect for preparation of the interim Beautification Plan.

Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

NMI Soil and Site Preparation Costs
As part of its initial overview of North Mare Island, SLC performed a comprehensive review of the suitability of soil conditions and potential risks associated with rising sea levels and other environmental events, including future flooding, inundation, and liquefaction. Based on the soils analysis in the 2018 ENGEO report prepared for City, SLC engaged ENGEO to estimate the cost to prepare the soils for a potential expanded range of land uses. In May 2020, ENGEO provided SLC a Technical Memo updating the soil import costs and detailing the surcharging costs to address sea level rise. As portions of the site are below the 100-year flood zone and below the sea level rise estimates for year 2100, it was concluded that the grades on North Mare Island need to be raised for development to Elevation +16 feet throughout the site to mitigate the risks associated with sea level rise. In order to accomplish this, and stabilize compressible soils, ENGEO reported that approximately 2 million cubic yards of soil would need to be imported. This soil importation, based on the $10 per cubic yard in ENGEO’s original report, is estimated to cost approximately $20 Million. This cost is in addition to the $30 Million of site development costs and $3.3 Million of demolition costs identified in the 2018 draft appraisal prepared for the City which concluded the “As Is” market value of North Mare Island was equal to a negative ($20.9 Million) (Attachment 10).

Next Steps / Anticipated Timeline
The next step in the process is the potential approval of the draft DDA. A Resolution Approving the North Mare Island Disposition and Development Agreement Between the City of Vallejo and The Nimitz Group LLC and Authorizing the City Manager to Execute Same and Any and All Other Documents Necessary to Effectuate the Purchase and Sale of the Property and the execution of the Sub-lease of the Navy Property is included as Attachment 8.

Upon Council approval, City staff will execute the NMI DDA Agreement and Nimitz will commence its 90-day feasibility period. The initial transfer of the City-owned 125 acres is anticipated to occur approximately 120 days following the execution of the DDA, allowing Nimitz and SLC to move forward quickly on the next phase Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

of land and infrastructure planning and soil preparation.

Initial closing is anticipated to occur within 30 days after approval or waiver of City and Nimitz’s Conditions to Conveyance, but no later than 120 days after the DDA’s execution. Following closing of the Initial Conveyance, the timeline of the DDA post-closing obligations is as follows:

Within 8 months: Submission of the Beautification Plan
 Construction of Beautification Work at entry points within 8 months after Beautification Plan approval
 Construction of remaining Beautification Work for North Mare Island and other areas identified on South Island within 24 months after Beautification Plan approval Within 12 months: Performance of Soil Testing
Within 24 months: Demolition of NMI buildings and Submission of New Specific Plan Within 42 months: City approval of New Specific Plan
Within 60 months: Completion of Connelly Corridor Development Work Seventh Amendment to the Exclusive Negotiation Agreement (ENA) As the Sixth Amended and Restated ENA for North Mare Island expires March 31, 2022, a short-term extension is required to ensure there is time to finalize and execute the DDA and ancillary documents and to complete the close of escrow. The Seventh Amended and Restated ENA (Attachment 2) extends the term of the ENA an additional nine months through December 31, 2022. A Resolution Authorizing Execution of the Seventh Amendment to the Exclusive Negotiation Agreement (ENA) With The Nimitz Group, LLC for the Property is included as Attachment 9.

FISCAL IMPACT
Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

The costs the City incurred for outside legal counsel and consulting professionals to assist in the negotiation and drafting of the North Mare Island Disposition and Development Agreement (DDA) and the Exclusive Negotiation Agreement (ENA) have been borne entirely by Nimitz through the City Cost Security Deposit reimbursement requirement in the ENA. Nimitz will continue to cover additional outside legal and consulting costs required to implement the agreements, with no impact to the General Fund.

Upon approval of this DDA, the City’s General Fund will be relieved of the approximately $320,000 annual costs for CFD taxes and the HUD loan, effective upon the first closing which would occur within 120 days following the DDA’s execution.

ENVIRONMENTAL REVIEW
Pursuant to CEQA Guidelines Section 15312 (Class 12, Surplus Government Property Sales), the Declaration of Exempt Surplus Property is Categorically Exempt from the Provisions of the California Environmental Quality Act.

The Project was reviewed in compliance with the requirements of CEQA and the CEQA Guidelines and it was determined in accordance with CEQA Sections 21166 and CEQA Guidelines Section 15162, 15164 and 15168 that an addendum to the previously certified Final Environmental Impact Statement / Environmental Impact Report (EIS/EIR) for the Disposal and Reuse of Mare Island Naval Shipyard Project (1998) and Addendum (1999), and the Mare Island amended and restated Specific Plan Project Final Subsequent Environmental Impact Report (2005) (Collectively Previously Certified Environmental Documents) was the appropriate environmental document for the North Mare Island Disposition and Development Agreement and Implementation Project and finds that the development-related activities described in the proposed DDA are within the scope of the development program described and evaluated in the Previously Certified Environmental Documents.

The Addendum (Attachment 5) analyzed the DDA, and the implementation project consistent with the existing Specific Plan and found no additional environmental review was required. The Resolution of the City Council of the City of Vallejo Making CEQA Findings and Approving an Addendum to the Previously Certified Date: March 22, 2022
Subject: CONSIDERATION AND POSSIBLE ADOPTION OF RESOLUTIONS: (1) DECLARING THE NORTH MARE ISLAND PROPERTY- APNs 0066-020-130 AND 0066-020-140, AND PORTIONS OF 0066-020-110 AND 0066-020-150 (PROPERTY) AS SURPLUS PROPERTY EXEMPT FROM THE PROVISIONS OF AB 1486 PURSUANT TO GOVERNMENT CODE SECTION 54234(a)(1) AND MAKING CEQA FINDINGS OF EXEMPTION RELATING THERETO; (2) MAKING CEQA FINDINGS AND

APPROVING AN ADDENDUM TO THE PREVIOUSLY CERTIFIED FINAL

ENVIRONMENTAL IMPACT STATEMENT / ENVIRONMENTAL IMPACT REPORT (EIS/EIR) FOR THE DISPOSAL AND REUSE OF MARE ISLAND NAVAL SHIPYARD PROJECT (1998) AND THE MARE ISLAND AMENDED AND RESTATED SPECIFIC PLAN PROJECT FINAL SUBSEQUENT ENVIRONMENTAL IMPACT REPORT (2005); (3) APPROVING THE NORTH MARE ISLAND DISPOSITION AND DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF VALLEJO AND THE NIMITZ GROUP LLC

AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAME AND ANY AND

ALL OTHER DOCUMENTS NECESSARY TO EFFECTUATE THE PURCHASE AND SALE OF THE PROPERTY AND THE SUBLEASE OF THE NAVY PROPERTY; AND (4) AUTHORIZING EXECUTION OF THE SEVENTH AMENDMENT TO THE

EXCLUSIVE NEGOTIATION AGREEMENT (ENA) WITH THE NIMITZ GROUP, LLC

FOR THE PROPERTY

Final Environmental Impact Statement / Environmental Impact Report (EIS/EIR) for the Disposal and Reuse of Mare Island Naval Shipyard Project (1998), and the Mare Island Amended and Restated Specific Plan Project Final Subsequent Environmental Impact Report (2005) is included as Attachment 7.

ATTACHMENTS

1. Nimitz NMI DDA v18 CC Agenda Packet Version

2. Seventh Amendment to Exclusive Negotiating Agreement CAO Stamp

3. NMI DDA Matrix - DDA comparison with Term Sheet

4. NMI DDA FAQ

5. Mare_Island_DDA_Addendum

6. City Council Resolution Finding NMI Surplus Land Final CAO Stamp (1)

7. City Council Resolution Approving Addendum to EIR For Nimitz DDA CAO Stamp

8. City Council Resolution Approving Nimitz DDA Final CAO Stamp

9. NMI ENA 7th Amendment Resolution CAO Stamp

10. 2019 Smith Assoc NMI Appraisal

11. Changed Pages DDA v18

CONTACT
Gillian Hayes, Interim Assistant City Manager, (707) 648-4163 [email protected]
Paul Kelley, Special Advisor to City Manager, Economic Development Manager, (707) 648-4109 [email protected]
Erin Hanford, Economic Development Program Manager, (707) 648-5406 [email protected]
OAK #4843-5079-9573 v18

RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:

City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Clerk
Record for the Benefit of
The City of Vallejo
Pursuant to Government Code
Section 27383
Space Reserved for Recorder's Use Only

DISPOSITION AND DEVELOPMENT AGREEMENT
by and between

CITY OF VALLEJO
and

THE NIMITZ GROUP, LLC
DATED: _____________, 2022

TABLE OF CONTENTS
Page
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-i100. INTRODUCTORY PROVISIONS ................................................................................... 4 101. Definitions.................................................................................................. 4 102. Representations and Warranties ............................................................... 15 103. Changes in Ownership, Management or Control ..................................... 17 200. SALE AND CONVEYANCE OF PROPERTY .............................................................. 19 201. Sale and Conveyance ............................................................................... 19 202. Feasibility Period ..................................................................................... 20 203. Escrow...................................................................................................... 22 204. Purchase Price; Deposit ........................................................................... 23 205. City’s Conditions Precedent to Conveyance............................................ 24 206. Developer’s Conditions Precedent to Conveyance .................................. 25 207. Closing ..................................................................................................... 26 208. Review and Approval of Condition of Title ............................................ 27 209. Property Taxes and Assessments ............................................................. 28 210. Environmental Matters............................................................................. 28 300. DEVELOPER’S POST CLOSING COVENANTS ........................................................ 31 301. Scope and Schedule for Developer’s Work ............................................. 31 302. Cost of Work ............................................................................................ 31 303. Permits and Approvals ............................................................................. 32 304. Consultation and Coordination ................................................................ 32 305. Rights of Access ...................................................................................... 32 306. Compliance with Laws ............................................................................ 32 307. Prevailing Wages ..................................................................................... 33 308. Local Economic Benefits ......................................................................... 33 309. Existing and New Services CFDs; Funding of Services .......................... 33 310. Minimum Assessed Value/Property Tax Covenant ................................. 36 311. Irrevocable Offer to Dedicate Roadways ................................................. 37 312. City of Vallejo Business License ............................................................. 37 313. Construction and Equipment Sales and Use Tax ..................................... 37 314. Fees of Other Agencies ............................................................................ 37 315. Limitations on Development under Existing Specific Plan ..................... 38 316. Island Energy Facility Relocations .......................................................... 38 317. Construction Staging Area License. ........................................................ 39

TABLE OF CONTENTS
(continued)
Page
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-ii318. Water and Sewer and Storm System Reimbursement Agreements ......... 39 400. CITY OBLIGATIONS AND RESERVATIONS OF DISCRETION ............................. 39 401. Future Application Processing ................................................................. 39 402. Island Energy Easements ......................................................................... 39 403. City Reserved Discretion ......................................................................... 40 404. Trust Termination Patents ........................................................................ 41 500. RESERVED ..................................................................................................................... 41 600. PAYMENT OF FEES AND CITY COSTS .................................................................... 41 601. Developer Reimbursement....................................................................... 41 602. Project Account ........................................................................................ 42 603. CEQA Related Costs................................................................................ 42 604. Invoices .................................................................................................... 43 605. Audit; Disputes ........................................................................................ 43 700. INSURANCE, INDEMNITY, LEGAL CHALLENGES ................................................ 43 701. Insurance Requirements ........................................................................... 43 702. Developer’s Indemnity............................................................................. 43 703. Cooperation and Indemnity in the Event of Legal Challenge .................. 44 800. DEFAULTS AND REMEDIES ...................................................................................... 44 801. Default...................................................................................................... 44 802. Legal Actions; Limitation on Damages ................................................... 45 803. Liquidated Damages in the Event of a Closing Failure ........................... 45 804. Acceptance of Service of Process ............................................................ 46 805. Termination .............................................................................................. 46 806. Additional City Remedy Following Conveyance - Option to Repurchase, Reenter and Repossess ........................................................ 46 807. Rights and Remedies Are Cumulative ..................................................... 48 808. No Waiver ................................................................................................ 48 900. DEVELOPER FINANCING; MORTGAGEE PROTECTION ...................................... 48 901. Generally .................................................................................................. 48 902. Right of City to Satisfy Other Liens After Closing ................................. 48 903. Mortgage, Deed of Trust, Sale and Lease-Back Financing ..................... 48 904. Estoppel Certificates ................................................................................ 49 1000. GENERAL PROVISIONS .............................................................................................. 50 1001. Notices, Demands and Communications between the Parties ................. 50

TABLE OF CONTENTS
(continued)
Page
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-iii1002. Enforced Delay; Extension of Times of Performance ............................. 51 1003. Successors and Assigns............................................................................ 51 1004. Non-Liability - Developer ........................................................................ 52 1005. Relationship between City and Developer ............................................... 52 1006. City Approvals and Actions ..................................................................... 52 1007. Counterparts ............................................................................................. 52 1008. Integration ................................................................................................ 52 1009. Brokerage Fees......................................................................................... 52 1010. Interpretation ............................................................................................ 52 1011. Modifications ........................................................................................... 53 1012. Severability .............................................................................................. 53 1013. Computation of Time ............................................................................... 53 1014. Time of Essence ....................................................................................... 53 1015. Cooperation .............................................................................................. 53 1016. Conflicts of Interest.................................................................................. 53 1017. Conflict with South Mare Island Property Documents ............................ 53 1018. Time for Acceptance of Agreement by City ............................................ 54 1019. Non-Liability of Officials and Employees of City .................................. 54 1020. Plans and Data.......................................................................................... 54 1021. Intentionally Omitted ............................................................................... 54 1022. Certificate of Completion ........................................................................ 54 1023. Applicable Laws ...................................................................................... 55 1024. Survival .................................................................................................... 55 1025. Right of First Offer .................................................................................. 55 OAK #4843-5079-9573 v18
List of Exhibits:

Exhibit A – Depiction of Property
Exhibit B-1 - Description of City-Owned Property
Exhibit B-2 – Description of Navy-Owned Property
Exhibit C – Scope of Work
Exhibit D – Schedule of Performance
Exhibit E – Form of Sublease
Exhibit F – Form of Quitclaim Deed
Exhibit G – Intentionally Omitted
Exhibit H – Form of PILOT Agreement
Exhibit I – Depiction of South Mare Island Property
Exhibit J – Legal Description of South Mare Island Property Exhibit K – Form of Certificate of Completion
Exhibit L – Insurance Requirements.

Exhibit M - Local Economic Benefit Program Requirements Exhibit N – Irrevocable Offer to Dedicate Roadways
Exhibit O – Water System Reimbursement Agreement
Exhibit P – Arbitration Provisions
Exhibit Q – Construction Staging Area Irrevocable License Exhibit R – Sewer and Storm System Reimbursement Agreement Exhibit S – Building 571 Remediation Agreement
OAK #4843-5079-9573 v18
1 DISPOSITION AND DEVELOPMENT AGREEMENT
THIS DISPOSITION AND DEVELOPMENT AGREEMENT (this “DDA” or this “Agreement”) dated ______________, 2022 (“Date of Agreement”), is entered into by and between the CITY OF VALLEJO, a California municipal corporation (“City”), and THE NIMITZ GROUP, LLC, a California limited liability company (“Developer”).

R E C I T A L S
The following Recitals are a substantive part of this Disposition and Development Agreement. Capitalized terms not defined in these Recitals are defined in Section 101 below.

A. The Mare Island Naval Shipyard was ordered closed in July 1993 pursuant to the Defense Base Closure and Realignment Act of 1990, as amended.

B. In accordance with procedures established under Federal and State law governing the planning, disposition and reuse of closed military bases, on July 26, 1994, City approved a Final Reuse Plan (“Reuse Plan”) for Mare Island that established goals for the reuse of Mare Island, including the creation of jobs and other economic development opportunities within the City, the creation of a self-sustaining and multi-use community, and the use of a variety of innovative economic development tools for the marketing, financing and acquisition of Mare Island following its closure by the federal government.

C. The Reuse Plan divided Mare Island into thirteen (13) “Reuse Areas” consisting of property owned by the federal government, including an approximately 192 acre Reuse Area

1. Following approval of the Reuse Plan, Reuse Area 1 was divided into two subcomponents: an approximately 155 acre area located north of G Street known as Reuse Area 1A and an approximately 37 acre area located east of Azuar known as Reuse Area 1B.

D. In connection with the approval of the Reuse Plan, the City Council on November 17, 1998, certified a final Environmental Impact Statement/Environmental Impact Report (SCH #940930029) (“EIS/EIR”) pursuant to the California Environmental Quality Act (California Public Resources Code Section 21000 et seq.) (“CEQA”), and the federal government, acting by and through the Secretary of the United States Department of the Navy (“Navy”), issued a Record of Decision pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. §§4321 4347 (“NEPA”).

E. On or about January 4, 2001, the Navy approved a Finding of Suitability for Transfer which, among other things, found that certain Mare Island property, including the Property and other portions of Reuse Area 1A, was environmentally suitable for early transfer in accordance with and subject to Section 120(h)(3)(C) of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §9620 et seq. (“CERCLA”).

F. Pursuant to the Finding of Suitability for Transfer, Navy conveyed to City certain Mare Island property described therein, including a portion of the City-Owned Property (described below) and other portions of Reuse Area 1A, by Quitclaim Deed dated September 26, OAK #4843-5079-9573 v18
2 2001, recorded in the Official Records of the County of Solano on October 17, 2001, Series No. 2001 00120695. Following the 2001 conveyance, the Navy issued further Findings of Suitability for Transfer in 2008 and 2011, and, in connection therewith, transferred to City by Quitclaim Deeds dated October 6, 2008 and April 13, 2011, and recorded in the Official Records of the County as Instrument Nos. 2009-00004941 and 2011-00042113, respectively, additional Mare Island property, including the balance of the City-Owned Property. The three Findings of Suitability for Transfer referenced above are referred to herein individually and collectively as the “FOST(s)” and the Navy Quitclaim Deeds are referred to herein individually and collectively as the “Navy Quitclaim Deed(s)”.

G. On or about March 30, 1999, City adopted a Mare Island Specific Plan governing the land use policy and development process for Mare Island. On or about December 6, 2005, City amended the Mare Island Specific Plan by adopting the Amended and Restated Mare Island Specific Plan. The City further amended the Amended and Restated Mare Island Specific Plan in July 2007, June 2008, June 2013, August 2013 and June, 2017. The Amended and Restated Mare Island Specific Plan, as further amended, is hereinafter referred to as the “Existing Specific Plan.”
H. In connection with City’s adoption of the Amended and Restated Mare Island Specific Plan, the City certified a final Subsequent Environment Impact Report on November 29, 2005 (SCH #2004092057) (“SEIR”). The SEIR identified and analyzed the significant impacts associated with the incremental change in intensity and distribution of land uses on Mare Island as compared to those described in the prior specific plan as originally adopted in 1999. In July 2007, an Addendum to the SEIR was prepared. The purpose of the 2007 Addendum was to address proposed amendments to policies in the Amended and Restated Mare Island Specific Plan and the Vallejo Municipal Code related to historic resources on Mare Island.

I. City, as successor in interest to the Navy, is the fee owner of approximately 125.3 acres of Reuse Area 1A (the “City-Owned Property”). The City-Owned Property is more particularly described in Exhibit B-1. An additional approximately 31.8 acre portion of Reuse Area 1A more particularly described in Exhibit B-2 (the “Navy-Owned Property”) is owned by the Navy and leased to the City pursuant to a Lease in Furtherance of Conveyance (“LIFOC”) dated September 30, 1999. City and Navy anticipate that following Navy’s completion of remediation activities and issuance of one or more additional Findings of Suitability for Transfer, the Navy-Owned Property will be conveyed by Navy to City via one or more further quitclaim deeds. As used herein the term “Property” means collectively, the City-Owned Property and the Navy-Owned Property (which collectively comprise approximately 157 acres as depicted in Exhibit A), together with all appurtenances thereto and all improvements located thereon.

J. Developer, as successor to Lennar Mare Island, LLC, is the fee owner of that certain real property located on Mare Island as generally depicted in Exhibit I and more particularly described in Exhibit J attached hereto (“South Mare Island Property”).

K. Most developable real properties on Mare Island, including the City-Owned Property and the South Mare Island Property, are subject to certain Existing CFDs which finance through the levy of Special Taxes the provision of certain public services to Mare Island. The OAK #4843-5079-9573 v18
3 parties desire to work in good faith to explore establishment of one or more new Mare Islandwide community facilities districts (the "New CFD(s)") pursuant to the Mello-Roos Act over all residential and commercial property on Mare Island, including the Property and the South Mare Island Property, which New CFD(s) would replace some or all of the Existing CFDs. As with the Existing CFDs, payment of the costs of CFD Services through the levy of Special Taxes under the New CFD(s) would strengthen the planning process by improving the linkage between development and the financing of essential governmental services; encourage participation by private landowners in the coordinated reuse and redevelopment of Mare Island; reduce economic risk by spreading the costs of needed services over time and among subsequent purchasers; and allow Developer, in exchange for voluntary participation in the New CFD(s), to acquire and coordinate development of the Property with development activities of Affiliates of Developer at the South Mare Island Property. The parties acknowledge that the long-term funding of public services through either the Existing CFDs or, alternatively, the long-term funding of CFD Services through New CFD(s) to replace some or all of the Existing CFDs, is critical to the financial success of the Project and other development projects on Mare Island, including the South Mare Island Property.

L. In July 2018, City and Developer entered into an Exclusive Right to Negotiate Agreement which has been further amended, most recently by a Sixth Amended and Restated Exclusive Negotiating Agreement dated December 14, 2021 (as so amended and restated, the “ERN”), providing, among other things, for City and Developer to negotiate terms for Developer’s (i) acquisition of a fee interest in the City-Owned Property and a sub-leasehold interest in the Navy-Owned Property (with a must take obligation to accept fee title conveyance of the Navy-Owned Property following City’s acquisition thereof from Navy); (ii) demolition of certain Non-Utilized Structures located on the Property; (iii) preparation and implementation of an interim Beautification Plan for the Property and South Mare Island Property, excluding the Connolly Corridor area; (iv) preparation and submittal to City for review and consideration and potential approval a comprehensive new proposed specific plan for the entirety of Mare Island, including those portions owned or controlled by Developer or Affiliates of Developer, including the Property and the South Mare Island properties which Developer or Affiliates of Developer have acquired or are under contract to acquire from Lennar Mare Island, LLC, which plan shall include a plan for phased installation and construction of new Backbone Infrastructure to serve all new development and redevelopment contemplated by such plan (“New Specific Plan”); (v) testing of certain soil previously stockpiled by Lennar Mare Island at six locations (i.e. two within Area 14, two within Area 8, one within Area 18 and one within Area 21) as shown on the draft stockpile site plan prepared by ENGEO dated September 2007, to determine its suitability for use as Clean Fill; (vi) importation of Clean Fill, surcharging and grading to raise the elevation of the Property to mitigate the risks of sea level rise and prepare the Property for development consistent with the New Specific Plan; (vii) construction and installation of the Backbone Infrastructure to serve the development contemplated by the New Specific Plan; and (viii) development of the Property with improvements and uses consistent with the New Specific Plan at such time as market and financing conditions will support such development.

M. The Demolition Work and Connolly Corridor Development Work are within the scope of the development program described and evaluated in the SEIR, as described in the OAK #4843-5079-9573 v18
4 CEQA Addendum to the Mare Island Specific Plan Environmental Impact Report dated ___________, 2021 prepared by Stantec pursuant to CEQA Guidelines Sections 15164 and 15168 and considered by the City Council on ______________, 2022 (“SEIR Addendum”). As set forth in this Agreement, City retains full and complete discretion with respect to review and approval of the proposed New Specific Plan and Beautification Plan, the Site Preparation Work, and any further land use approvals or development applications with respect to the Property and/or South Mare Island (collectively, “Future Applications”), including without limitation, to the extent applicable, the discretion to require additional review of any proposed development plan or project under CEQA, the right to impose mitigation measures, and the ability to require modifications to the proposed development plan or project or to disapprove the proposed development plan or project subject to compliance with Applicable Laws.

N. As contemplated by the ERN, City and Developer now desire to enter into this DDA to provide, among other things, for (i) the conveyance of the City-Owned Property to Developer; (ii) sublease of the Navy-Owned Property to Developer on an interim basis until such time as City is ready to acquire a fee interest in the Navy-Owned Property from Navy and immediately thereafter, through back-to-back escrow, convey the Navy-Owned Property to Developer; (iii) Developer’s preparation and submittal to City for consideration and potential approval, and if approved by City, Developer’s subsequent implementation of, a Beautification Plan and a proposed New Specific Plan; (iv) Developer’s performance of certain Demolition Work on the Property and certain Connolly Corridor Development Work on the South Mare Island Property; and (v) following City’s approval of a New Specific Plan and Beautification Plan, and if and only if approval of such plans occurs, Developer’s performance of certain Site Preparation Work and Beautification Work in order to ready the Property for development.

O. City has determined that by entering into this DDA and the Transaction Documents, City will promote orderly growth and quality development on Mare Island in accordance with the goals and policies set forth in the Reuse Plan and the City’s General Plan.

P. The terms and conditions of this DDA have undergone review by City staff and the City Council of the City of Vallejo at publicly-noticed meetings and have been found to be fair, just and reasonable and in conformance with the City’s General Plan, and further, the City Council finds that the economic interests of City’s citizens and the public health, safety and welfare will be best served by entering into this DDA.

NOW, THEREFORE, City and Developer hereby agree as follows:

A G R E E M E N T S:
100. INTRODUCTORY PROVISIONS.
101. Definitions.
“Affiliate of Developer” is defined in Section 103.2a.
“Agreement” means this Disposition and Development Agreement.

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5 “Ancillary Agreements” is defined in Section 601.3.
“Applicable Laws” is defined in Section 306.
“AV” is defined in the PILOT Agreement.
“Backbone Infrastructure” means the infrastructure improvements, including roadways, pedestrian paths, and other public rights of way and public access facilities; potable water, sanitary sewer, storm water, electrical, telephone/cable/data and natural gas lines, conduits and facilities; parks; landscaping; public parking; lighting; and other public facilities and utilities to be constructed and installed by Developer in connection with its development of the Property and South Mare Island Property, the details of which will be set forth in the proposed New Specific Plan.
“Beautification Plan” means the plan for installation of interim landscaping, hardscaping, fencing, lighting and security to be submitted by Developer to City for consideration, and potential approval, as more particularly described in the Scope of Work as well as any such final plan that may be approved by the City, and all amendments and modifications made to such final approved plan, from time to time, as the same may be approved by the City to the extent required. “Beautification Work” means the interim beautification work to be described in the Beautification Plan.
“Building 571 Remediation Work” is defined in Section 210.1. “Building 571 Remediation Agreement” means the agreement to be entered into by City and Developer at Closing of the Initial Conveyance pursuant to which City will commit to complete certain PCB-related remediation activities at the former Building 571 site in the form attached hereto as Exhibit S. “CEQA” is defined in Recital D.
“CERCLA” is defined in Recital E.
“Certificate of Completion” means the City certificate substantially in the form of Exhibit K, evidencing satisfactory completion of all of Developer’s Work, including the Demolition Work, Soil Testing, Connolly Corridor Development Work, Planning Work, Beautification Work, and Site Preparation Work. “CFD Services” means those services that may lawfully be financed under the Mello-Roos Act or City’s Financing Code, each as amended from time to time. “City” means City of Vallejo, a California municipal corporation. “City Conditions Precedent” is defined in Section 205.

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6 “City Costs” is defined in Section 601.
“City Fees” is defined in Section 601.1.
“City Option” is defined in Section 806.1.
“City-Owned Property” is defined in Recital I.
“City Parties” means, collectively, the City and its officers, officials, employees, contractors, volunteers, agents, and representatives, and their respective successors and assigns.
“City’s Response” is defined in Section 208.2.
“City ROFO Acceptance” is defined in Section 1025.
“Claims” means any and all liabilities, obligations, orders, claims, damages, governmental fines or penalties, awards of attorneys’ fees to third parties, and expenses of defense with respect to any of the foregoing, including reasonable attorneys’ fees and costs.
“Clean Fill” means soil, gravel, sand, or crushed concrete, cement or brick suitable for importation and subsequent development of the Property, which (i) has not been mixed with any other waste or debris, (ii) is not subject to any known spill of petroleum products or release of Hazardous Materials, and (iii) has not been treated to remediate any Hazardous Materials contamination. Except as City may otherwise agree, prior to Final approval of a New Specific Plan the soil and other materials shall be suitable for, and meet all regulatory and permitting requirements for development of residential uses. Following Final approval of a New Specific Plan the soil and other materials shall be suitable for, and meet all applicable regulatory and permitting requirements for development of the uses set forth in the New Specific Plan.
“Closing” is defined in Section 207.
“Closing Date” is defined in Section 207.
“Condition of Title” is defined in Section 208.3.
“Connolly Corridor” means the approximately three (3)-acre portion of South Mare Island, as generally depicted on Exhibit I.
“Connolly Corridor Development Work” means Developer’s subdivision of parcels and construction and development within the Connolly Corridor area of new buildings, or substantial rehabilitation of existing vacant historic buildings, to accommodate use and occupancy of approximately 45,000 gross square feet of retail space, approximately 29,000 gross square feet of office space, OAK #4843-5079-9573 v18
7 approximately 194,000 square feet of open space, up to 373 multifamily and townhome units, and a hotel including up to 200 rooms. Construction of any Connolly Corridor Development Work will require the submission and approval of such work through the City of Vallejo’s Unit Plan process. As part of that process, Developer will be required to submit detailed architectural, utility and landscape plans.
“Construction Staging Area License” means the irrevocable floating license for periodic use of a construction laydown area to be granted by Developer to City immediately following recordation of the Deed for the Initial Conveyance in substantially the form attached hereto as Exhibit Q.
“Conveyance(s)” is defined in Section 201.
“CRUP(s)” means the recordable covenants to restrict use of the Property, or applicable portion thereof, as a result of the presence on the Property (or applicable portion thereof) of Hazardous Materials that have been entered or will be entered into in the future by Navy or its successor and the State of California acting by and through the Department of Toxic Substances Control or other environmental regulatory agency in accordance with Health and Safety Code section 25355.5, California Civil Code section 1471, and California Code of Regulations, Title 22 section 67391.1 for purposes of protecting human health, safety, and the environment.
“Date of Agreement” is defined in the introductory paragraph preceding the Recitals of this DDA.
“DDA” means this Disposition and Development Agreement. “Deed” means the quitclaim deed for each Conveyance of the Property by City to Developer in substantially the form attached hereto as Exhibit F and defined in Section 201.
“Default” is defined in Section 801.
“Demolition Work” means and includes all work of demolishing the Non-Utilized Buildings, including containing, removing and disposing of all debris, including lead based paint, PCB and asbestos containing materials in accordance with Applicable Laws, including Environmental Laws, as more particularly described in the Scope of Work.
“Deposit” is defined in Section 204.2.
“Designated City Employee” is defined in Section 102.1d. “Designated Developer Employee” is defined in Section 102.2e.

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8 “Developer” means The Nimitz Group, LLC, a California limited liability company.
“Developer Conditions Precedent” is defined in Section 206. “Developer Parties” is defined in Section 202.1.
“Developer’s Response” is defined in Section 208.2.
“Developer Title Policy” is defined in Section 206.4.
“Developer’s Work” means and includes all of the Demolition Work, Soil Testing, Connolly Corridor Development Work, Planning Work (including New Specific Plan and Beautification Plan), Beautification Work and Site Preparation Work that Developer must commence and complete following Closing of the Initial Conveyance, subject to and in accordance with the terms and conditions of this Agreement. Developer’s Work is described with particularity in the Scope of Work.
“DTSC” means the State of California Department of Toxic Substances Control. “Elections Code” means the State of California Elections Code, as amended and modified from time to time.
“EIS/EIR” is defined in Recital D.
“Environmental Laws” means all federal, state and local laws, ordinances, rules and regulations now or hereafter in force, as amended from time to time, in any way relating to or regulating human health or safety, or industrial hygiene or environmental conditions, or protection of the environment, or pollution or contamination of the air, soil, surface water or groundwater, including the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. §9601 et seq.; the Solid Waste Disposal Act, 42 U.S.C. §6901 et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. §6901 et seq.; the Hazardous Substance Account Act, California Health and Safety Code §25300 et seq.; the Hazardous Waste Control Law, California Health and Safety Code §25100 et seq.; and the Porter-Cologne Water Quality Control Act, California Water Code §13000 et seq.
“ERN” is defined in Recital L.
“Escrow” is defined in Section 203.
“Escrow Agent” is defined in Section 203.
“Existing CFDs” means CFD 2002-1, CFD 2005-1A and CFD 2005-1B, the three community facilities districts authorized to levy Special Taxes to fund the OAK #4843-5079-9573 v18
9 provision of services (and, in the case of CFD 2005-1A, services and facilities) on Mare Island previously established by City in accordance with the Mello-Roos Act or the Financing Code (which incorporates by reference, with modifications, the terms of the Mello-Roos Act), as applicable.
“Existing Specific Plan” is defined in Recital G.
“Feasibility Period” is defined in Section 202.
“Final” when used in reference to the New Specific Plan means the date on which (i) all applicable appeal periods for the filing of any administrative appeal or litigation challenging the approval or effectiveness of the New Specific Plan and the City’s related CEQA determinations shall have expired and no such appeal shall have been filed; (ii) in the event of any administrative appeal or litigation challenge challenging one or more of such approvals, that the administrative appeal or litigation challenge is settled or there is a final determination or judgment upholding the approval(s), and the administrative appeal or litigation challenge is no longer subject to appeal; and (iii) in the event of a timely referendum petition certified by the elections official as compliant with the Elections Code, a majority of voters voting on the New Specific Plan vote in favor of it and the election results are certified in accordance with the Elections Code.
“Financing Code” is defined in Section 309.1.
“Force Majeure Conditions” is defined in Section 1002.
“FOST(s)” is defined in Recital F.
“Future Applications” is defined in Recital M.
“Hazardous Materials” means any substance, material, or waste which is or becomes regulated by any local governmental authority, the State of California, or the United States of America, including any material or substance which is: (i) defined as a “hazardous waste,” “extremely hazardous waste,” or “restricted hazardous waste” under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140 of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law); (ii) defined as a “hazardous substance” under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.8 (Carpenter-Presley-Tanner Hazardous Substance Account Act); (iii) defined as a “hazardous material,” “hazardous substance,” or “hazardous waste” under Section 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory); (iv) defined as a “hazardous substance” under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances); (v) petroleum, petroleum products, components and by-products; (vi) asbestos OAK #4843-5079-9573 v18
10 and asbestos-containing materials; (vii) polychlorinated biphenyls; (viii) per- and polyfluoroalkyl substances (“PFAS”); (ix) listed under Article 9 or defined as “hazardous” or “extremely hazardous” pursuant to Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20; (x) designated as “hazardous substances” pursuant to Section 311 of the Clean Water Act (33 U.S.C. § 1317); (xi) defined as a “hazardous waste” pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42 U.S.C. § 6901, et seq. (42 U.S.C. § 6903); or (xii) defined as “hazardous substances” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601, et seq., as the foregoing statutes and regulations now exist or may hereafter be amended.
“HUD 108 Loan” means the loan by the United States Department of Housing and Urban Development as lender to the City of Vallejo as borrower in a maximum amount of $4,719,000 made pursuant to the Contract of Loan Guarantee Assistance under Section 108 of the Housing and Community Development Act of 1974, as amended.
“HUD Security Documents” means the various instruments pledging assets of the City, including City’s future Community Development Block Grant funds and certain real property interests owned by City, as security for City’s obligation to repay the HUD 108 Loan.
“Initial Conveyance” is defined in Section 201.
“Interim Permitted Specific Plan Development” is defined in Section 315. “Interim Planning Period” is defined in Section 315.
“Irrevocable Offer to Dedicate Roadways” mean the irrevocable offer of dedication set forth and described in Exhibit N attached hereto and incorporated herein, to be executed by Developer in favor of City and recorded against the Property, or applicable portion thereof, at each Closing as provided in Sections 203 and 311 below.
“Island Energy” means Pittsburg Power Company Joint Powers Authority doing business as Island Energy, GST Telecom Company, Inc., which provides electrical and gas utility service to Mare Island.
“Lennar Mare Island” or “LMI” mean Lennar Mare Island, LLC, a California limited liability company.
“LIFOC” is defined in Recital I.
“Local Economic Benefit Program Requirements” means the program requirements regarding job creation, work force development and inclusion of OAK #4843-5079-9573 v18
11 minority-, women-, and locally-owned businesses and enterprises set forth in Exhibit M.
“Manager” or “Managing Member” means Dave Phinney and Sebastian Lane, the co-managing members of Developer.
“Mello-Roos Act” means the Mello-Roos Community Facilities Act of 1982 (Government Code sections 53311 et seq.)
“Minimum Owner Property AV” is defined in the PILOT Agreement. “Minimum Tax Revenue Date” is defined in the PILOT Agreement. “Monetary Liens” is defined in Section 208.2.
“Navy” is defined in Recital D.
“Navy Deed Covenants” means Navy’s ongoing covenants and obligations to (i) assess, inspect, investigate, study, remove and remediate, as appropriate, the release or threatened release of a hazardous substance, pollutant or contaminant, from or on the Property, including subsurface soils, groundwater and surface waters, and (ii) settle or defend any claim, demand, or order made by federal, state or local regulators or third parties in connection with any release or threatened release of a hazardous substance, pollutant or contaminant, from or on the Property, including subsurface soils, groundwater and surface waters, in each case to the extent such release or threated release was caused by Department of Defense activities on the former Mare Island Naval Shipyard, all as more particularly set forth in the Navy Quitclaim Deed(s) and those future Navy quitclaim deeds to be executed by Navy in connection with the conveyance to City of Navy’s right, title and interest in and to the Navy-Owned Property. “Navy-Owned Property” is defined in Recital I.
“Navy Quitclaim Deed(s)” is defined in Recital F.
“NEPA” is defined in Recital D.
“New CFD(s)” is defined in Recital K.
“New Specific Plan” is defined in Recital L.
“Non-Exclusive License Agreement” means the Non-Exclusive License Agreement between City and Developer dated November 12, 2020. “Non-Utilized Structures” means buildings numbered 499, 503, 517, 589, 593, 601, 653, 663, 673 and 993 located on and about the Property. For avoidance of OAK #4843-5079-9573 v18
12 doubt buildings numbered 577, 777 and 857 are currently in use and shall not be deemed “Non-Utilized Structures”.
“Notice of Approval” is defined in Section 202.3.
“Notice of Intent” is defined in Section 806.3a.
“Offer Notice” is defined in Section 1025.
“Outside Date for Initial Conveyance” is defined in Section 207. “PCB Contaminated Debris” is defined in Section 210.1.
“Permitted Transfer” is defined in Section 103.2.
“PILOT Agreement” means the Agreement for Payments in Lieu of Taxes substantially in the form of Exhibit H attached hereto, to be executed and acknowledged by the parties and recorded in the Official Records of the County upon each Closing.
“Planning Work” means the work of preparing, providing to City staff for review, input and comment, refining based on City staff comments, and submitting (and, if necessary, revising and resubmitting one or more times) to the City’s Planning Commission and City Council for consideration, and obtaining City Council approval of a proposed New Specific Plan and a Beautification Plan, as more particularly described in the Scope of Work. The Planning Work also includes preparation of all environmental reports, studies and related documents in connection with the CEQA review of such plans.
“Pre-Approved Exceptions” is defined in Section 208.1.
“Prevailing Wage Laws” is defined in Section 307.
“Project Account” is defined in Section 602.
“Project Account Deposit” is defined in Section 602.
“Project Hard Costs” is defined in Section 806.3a.
“Property” is defined in Recital I.
“Purchase Price” is defined in Section 204.1.
“Recession” means a quarterly decline in the monetary value of all finished goods and services produced in the United States, as measured by initial quarterly estimates of US Gross Domestic Project (“GDP”) published by the US Department of Commerce Bureau of Economic Analysis (and not BEA’s OAK #4843-5079-9573 v18
13 subsequent monthly revisions), lasting more than two (2) consecutive calendar quarters. Any quarter of positive GDP growth shall end the period of such Recession.
“Reuse Plan” is defined in Recital B.
“ROFO Transfer Agreement” is defined in Section 1025.
“RWQCB’ means the State Water Quality Control Board for the San Francisco region.
“SEIR” is defined in Recital H.
“Schedule of Performance” means the Schedule of Performance attached hereto as Exhibit D.
“Scope of Work” means the Scope of Work attached hereto as Exhibit C describing the scope of the Developer’s Work to be performed by Developer following the Initial Conveyance.
“SEIR Addendum” is defined in Recital M.
“Sewer and Storm System Reimbursement Agreement” means the sewer and storm system reimbursement agreement in substantially the form of the agreement attached hereto as Exhibit R to be executed by Developer and VFWD and recorded against the Property, or applicable portion thereof, at each Closing as provided in Sections 203 and 318 below.
“Site Preparation Work” means the work of importing Clean-Fill, grading and surcharging the Property so as to raise the elevation of the Property and otherwise prepare the Property for horizontal and vertical development as generally described in the Scope of Work, the details of which will be set forth in the New Specific Plan.
“Soil Testing” means the sampling and testing of soil previously stockpiled by Lennar Mare Island at six locations (i.e. two within Area 14, two within Area 8, one within Area 18 and one within Area 21) as shown on the draft stockpile site plan prepared by ENGEO dated September 2007, to determine its suitability for importation and use as Clean Fill suitable for development of residential or residential mixed-use development.
“Southern Land Company” means Southern Land Company, LLC, a Tennessee limited liability company, Developer’s land manager for development of the Property and the South Mare Island Property.
“South Mare Island Property” is defined in Recital J.

OAK #4843-5079-9573 v18
14 “South Mare Island Property Documents” means, collectively, (i) that certain Acquisition Agreement dated December 21, 1999, by and between the City and Developer, as successor in interest to Lennar Mare Island, LLC, as amended (“South Mare Island Acquisition Agreement”); and (ii) that certain Development Agreement by and between the City and Developer, as successor to Lennar Mare Island, dated as of September 12, 2001, and recorded in the Official Records of Solano County on September 12, 2001, as Instrument No. 2001-00104427, as amended by the First Amendment to Development Agreement dated November 30, 2004, and recorded in the Official Records on January 13, 2005, as Instrument No. 2005-00006646 (“South Mare Island Development Agreement”). “Special Taxes” for purposes of this Agreement, means special taxes levied against real property on Mare Island pursuant to the Mello-Roos Act and/or the Financing Code and other Applicable Laws, for the purposes of funding public services as currently funded under the Existing CFDs or CFD Services under potential future New CFD(s).
“State Lands Settlement Agreement” means that certain Mare Island Property Settlement and Exchange Agreement dated February 28, 2002, recorded in the Official Records of Solano County on March 26, 2002, as Instrument No. 2002- 00037955 among City, the State of California, acting by and through the State Lands Commission, and, for limited purposes, Developer, as successor to Lennar Mare Island, LLC.
“Sublease” means the Sublease between City and Developer with respect to the Navy-Owned Property in the form attached hereto as Exhibit E. “Subject Property” is defined in Section 1025.
“Survey” is defined in Section 208.1.
“Title Company” is defined in Section 203.
“Title Notice” is defined in Section 208.2.
“Title Report” is defined in Section 208.1.
“Title Review Period” is defined in Section 208.2.
“Transaction Documents” means collectively, the PILOT Agreement, the Deeds, the Construction Staging Area License, the Irrevocable Offer to Dedicate Roadways, the Water System Reimbursement Agreement, the Sewer and Storm System Reimbursement Agreement and the Sublease.
“Transfer” is defined in Section 103.2.

OAK #4843-5079-9573 v18
15 “Transfer Agreement” is defined in Section 103.4.
“VFWD” means the Vallejo Flood and Wastewater District. “VUSD” means the Vallejo Unified School District.
“Water System Reimbursement Agreement” means the water system reimbursement agreement attached hereto as Exhibit O to be executed by Developer and City and recorded against the Property, or applicable portion thereof, at each Closing as provided in Sections 203 and 318 below. “Work Product” is defined in Section 1020.
102. Representations and Warranties.
102.1 City Representations. City represents and warrants to Developer as follows:
a. Authority. City is a municipal corporation duly organized within and in good standing under the laws of the State of California. City has full right, power, ability and lawful authority to perform its obligations hereunder and under the Transaction Documents, and City’s execution, performance and delivery of this DDA and the Transaction Documents have been duly authorized by all requisite actions on the part of City. b. No Conflict. City’s execution, delivery and performance of its obligations under this DDA and the Transaction Documents will not constitute a default or a breach under any contract, agreement or order to which City is a party or by which it is bound. c. No Litigation or Other Proceeding. To City’s knowledge, no litigation or other proceeding (whether administrative or otherwise) is outstanding or has been threatened which would prevent, hinder or delay the ability of City to perform its obligations under this DDA or the Transaction Documents.
d. No Notice of Uncured Violations of Laws. To City’s knowledge, except as otherwise disclosed to Developer in writing, including in Section 210.1 below, City has not received any written notice of uncured violation of any Applicable Laws, including Environmental Laws with respect to the Property during the time period that City has held fee title to the City-Owned Property and a leasehold interest in the Navy-Owned Property, and to City’s knowledge there are currently no existing violations of Applicable Laws, including Environmental Laws, with respect to the Property.

References to the “knowledge” of City shall refer only to the current actual knowledge of the Designated City Employee (as hereinafter defined) of City, and shall not be construed, by imputation or otherwise, to refer to the knowledge of any other officer, agent, manager, representative or employee of City or to impose upon such Designated City Employee any duty to investigate the matter to which such actual knowledge, or the absence thereof, pertains; OAK #4843-5079-9573 v18
16 provided City hereby agrees that the Designated City Employee is the employee most knowledgeable at the City with respect to any such matters qualified in this way. As used herein, the term “Designated City Employee” shall refer to Paul Kelley, Special Advisor to the City Manager/Economic Development Manager.
102.2 Developer’s Representations. Developer represents and warrants to City as follows:
a. Authority. Developer is a limited liability company duly organized and in good standing under the laws of the State of California. Developer has full right, power, and lawful authority to undertake all of its obligations under this DDA and the Transaction Documents, and Developer’s execution, performance, and delivery of this DDA and the Transaction Documents have been duly authorized by all requisite actions on the part of Developer. Developer agrees to provide City, upon request, with an Officer’s Certificate, Written Consent of Members, or other commercially reasonable formal written evidence, reasonably acceptable to the City, of Developer’s authority to enter into this DDA and the Transaction Documents.
b. Execution. Developer’s execution and delivery of this DDA and the Transaction Documents, and the performance of the obligations of Developer under this DDA and the Transaction Documents have been duly authorized by all necessary company action, and all necessary member approvals have been obtained therefor, and no approvals or consents of any persons are necessary for Developer’s execution, delivery or performance of this DDA or the Transaction Documents, except as have been obtained. c. No Conflict. Developer’s execution, delivery and performance of its obligations under this DDA and the Transaction Documents will not constitute a default or a breach under any contract, agreement or order to which Developer and/or Developer’s Manager or Managing Member, as applicable, is a party or by which it is bound. d. No Litigation or Other Proceeding. To Developer’s knowledge, no litigation or other proceeding (whether administrative or otherwise) is outstanding or has been threatened which would prevent, hinder or delay the ability of Developer to perform its obligations under this DDA or the Transaction Documents. e. No Developer Bankruptcy. As of the Date of Agreement, neither Developer nor Developer’s Manager or Managing Member, as applicable, is the subject of any bankruptcy proceeding, nor has either (i) made a general assignment for the benefit of creditors, (ii) filed any voluntary petition in bankruptcy or suffered the filing of any involuntary petition by its respective creditors, (iii) suffered the appointment of a receiver to take possession of all, or substantially all, of its assets, (iv) suffered the attachment or other judicial seizure of all, or substantially all, of its assets, (v) admitted in writing its inability to pay its debts as they come due, or (vi) made an offer of settlement, extension or composition to its creditors generally.

References to the “knowledge” of Developer shall refer only to the current actual knowledge of the Designated Developer Employee (as hereinafter defined) of Developer, and OAK #4843-5079-9573 v18
17 shall not be construed, by imputation or otherwise, to refer to the knowledge of any other officer, agent, manager, representative or employee of Developer or to impose upon such Designated Developer Employee any duty to investigate the matter to which such actual knowledge, or the absence thereof, pertains. As used herein, the term “Designated Developer Employee” shall refer to Thomas D. D’Alesandro.
102.3 Renewal of Representations and Warranties. Each party shall promptly notify the other party of any material change in any condition or of any event or circumstance which makes any representation or warranty of such party under this DDA untrue or misleading.

Each of the representations and warranties made by City and Developer hereunder (i) is true as of the Date of Agreement, (ii) shall be deemed remade and shall be true in all material respects as of the date of Closing, and (iii) shall survive Closing. 103. Changes in Ownership, Management or Control.
103.1 General Prohibition. The qualifications and identity of Developer and its current Managing Member, and its land manager, Southern Land Company, are of particular interest to City given the Developer’s commitments hereunder to (a) prepare and submit to City for consideration and potential approval and, if approved by City, thereafter implement a Beautification Plan and a New Specific Plan; and (b) prepare the Property for development contemplated by the New Specific Plan by, among other things, commencing and completing the Demolition Work and Site Preparation Work so that the Property is suitable for development of uses permitted under Applicable Laws. It is because of those qualifications and identity, that City has entered into this DDA with Developer. Except as otherwise specifically provided in this DDA, prior to City’s issuance of the Certificate of Completion, no voluntary or involuntary successor in interest of Developer shall acquire any ownership interest in the Property nor any rights or powers under this DDA, except for Permitted Transfers or as may otherwise be approved by City in its sole and absolute discretion.
103.2 Permitted Transfers. Notwithstanding any other provision of this DDA to the contrary, City approval of a transfer of the Property (or any portion thereof) or an assignment of this DDA or any interest therein (“Transfer”) shall not be required in connection with any of the transfers listed in items a. through c. below (each, a “Permitted Transfer”):
a. Any transfer of the Property (or portion thereof) or assignment of this DDA or any interest herein to an entity in which either (1) Gaylon Lawrence, or (2) Gaylon Lawrence and Dave Phinney, or (3) Gaylon Lawrence and Sebastian Lane, retains a beneficial economic interest, and in which (i) Gaylon Lawrence, Dave Phinney, or Sebastian Lane, or (ii) Southern Land Company retains effective management and control of the transferee entity, subject only to major events requiring the consent or approval of the other owners of such entity (collectively, the entities described in subclauses (i) and (ii) above are each referred to herein as an “Affiliate of Developer”), and in connection with which such Affiliate of Developer assumes the rights and obligations of Developer under this DDA and the Transaction Documents pursuant to an assignment and assumption agreement in a form reasonably acceptable to City’s legal counsel;
OAK #4843-5079-9573 v18
18 b. Any assignment for financing purposes that results in a lien on the Property or Developer’s interest therein, including the grant of deeds of trust to secure construction and permanent financing for development of the Property; or c. A transfer which combined with any and all previous or simultaneous transfers represents less than fifty percent (50%) of the membership, equity or beneficial interest of Developer, provided such transfer does not cause a material change in the rights to manage and control Developer.
d. Following City’s approval of a New Specific Plan, Developer shall have the right to transfer individual parcels to one or more vertical developers for development purposes; provided however any proposed transfer that, together with any prior or concurrent transfers, would result in conveyance of more than twenty percent (20%) of the Property to a single transferee (or affiliates of a single transferee) shall be subject to City Council approval not to be unreasonably withheld, conditioned or delayed and which approval shall be granted provided the proposed transferee meets the criteria set forth in Section 103.3 below.

Developer shall give at least ten (10) business days’ prior written notice to City of any proposed Permitted Transfer. In addition, City shall be entitled to receive and review such documentation as may be reasonably required by the City Manager or his/her designee to assess the nature and scope of any proposed Permitted Transfer, but in all events, such review (i) shall not be deemed to have created any consent rights for City, (ii) shall be completed within ten (10) business days following City’s receipt of the requested information, and (iii) shall be limited to solely whether the transfer and/or transactions(s) in question constitutes a Permitted Transfer under this Agreement.
103.3 Other Transfer or Assignment. For any proposed Transfer that is not a Permitted Transfer under Section 103.2 above, or a partial Transfer which does not require City Council approval under Section 103.2d, Developer shall give notice to City of Developer’s desire to make such Transfer. Developer’s notice shall include information concerning the proposed transferee, including the transferee’s bonding capacity and specific development experience, financial capabilities and knowledge concerning the Property and the required Developer’s Work. City shall have thirty (30) days following receipt of such notice to request additional information regarding the proposed Transfer and the transferee’s experience and financial capacity as is reasonably necessary to evaluate the proposed Transfer and transferee.

City shall have until the later of (30) calendar days after Developer gives its initial notice or twenty (20) days after receipt of all additional requested information, if any, to review and either approve or reject the proposed Transfer and transferee. City’s approval of the proposed Transfer and transferee shall not be unreasonably withheld, conditioned, or delayed. The parties agree that it shall not be unreasonable for City to disapprove a proposed Transfer and transferee based on: (i) City’s reasonable determination that the proposed transferee has insufficient understanding of one or more components of the required Developer’s Work and Transaction Documents; (ii) transferee having bonding capacity less than that of Developer, and also less than would be reasonably required given the status of the Developer’s Work at such time; and/or (iii) transferee lacking, in the City’s reasonable determination, the development qualifications OAK #4843-5079-9573 v18
19 and experience and financial capacity to reasonably ensure successful completion of one or more components of Developer’s Work followed thereafter by constructing and installing the Backbone Infrastructure and developing the Property with other horizontal and vertical improvements and uses consistent with the New Specific Plan and Applicable Laws. If City rejects the proposed Transfer and transferee, City shall provide written notice of such rejection within the time period set forth above, and in its notice of rejection, City shall detail all reasons supporting rejection of the proposed Transfer and transferee based on the standards set forth in this Section 103.3. Notwithstanding the foregoing, the matters set forth in subclauses (i) through (iii) above shall not apply to any Permitted Transfer, including any permitted partial Transfer of 20% or less of the Property to a single vertical developer transferee as contemplated under Section 103.2.d above.
103.4 Written Transfer Agreement. In connection with any Transfer by Developer, including any Permitted Transfer or any partial Transfer as contemplated under Section 103.2d, Developer and the transferee shall enter into a written agreement (“Transfer Agreement”) regarding the respective interests, rights and obligations of Developer and the transferee in and under this DDA and, to the extent applicable, the other Transaction Documents.

The Transfer Agreement shall be in a form reasonably acceptable to the City Attorney. Such Transfer Agreement may (i) release Developer from obligations and liabilities under this DDA that pertain to that portion of the Property being transferred, as described in the Transfer Agreement, provided the transferee expressly assumes all such obligations and liabilities, including all past, present and future obligations and liabilities, (ii) transfer to the transferee all rights and all obligations under this DDA and, to the extent applicable, the other Transaction Documents, to develop that portion of the Property being transferred, and (iii) address such other matters as are reasonably necessary or appropriate in connection with the Transfer. 103.5 Transfer Following Issuance of Certificate of Completion. There shall be no restrictions on or prohibition of Developer’s right to make any transfer of any interest in the Property or any rights or powers under the DDA following issuance of the Certificate of Completion.
200. SALE AND CONVEYANCE OF PROPERTY.
201. Sale and Conveyance. City agrees to sell to Developer, and Developer agrees to purchase from City, the Property in accordance with and subject to the terms and conditions of this DDA. The purchase and sale transaction shall occur via two (2) or more conveyances as portions of the Navy-Owned Property are acquired by City. Each conveyance of a portion of the Property by City to Developer is hereinafter referred to individually as a “Conveyance” and collectively as the “Conveyances”. City shall convey the City-Owned Property to Developer by execution and delivery of a Deed, and, concurrently therewith, shall sublease the Navy-Owned Property to Developer pursuant to a Sublease which the Parties shall execute in the forms required under this Agreement. Developer shall pay any and all costs of preparing legal descriptions of the City-Owned Property and Navy-Owned Property, including surveyor costs.

Immediately following delivery and recordation of the Deed for the Initial Conveyance, Developer shall grant to City a Construction Staging Area License in the form of Exhibit Q OAK #4843-5079-9573 v18
20 attached hereto to facilitate future maintenance and repair work on the Mare Island Causeway Bridge. Upon City’s acquisition of fee title to the Navy-Owned Property, City shall convey the Navy-Owned Property, or applicable portion thereof, to Developer by execution and delivery of a Deed with respect to such property. The initial Conveyance of the City-Owned Property by City to Developer is referred to herein as the “Initial Conveyance”. Following the Closing of the Initial Conveyance, Developer shall have a “must-take obligation” to accept from City the Conveyance of fee title to the Navy-Owned Property as and when the Navy-Owned Property, or applicable portion thereof, is acquired by City immediately following City’s acceptance of such property from Navy, subject nevertheless to satisfaction or written waiver (in Developer’s reasonable discretion) of all Developer Conditions Precedent applicable to such subsequent Conveyance. Each Closing for City’s Conveyance of Navy-Owned Property to Developer shall occur immediately following City’s acceptance of the Navy-Owned Property, or applicable portion thereof, from Navy through one or more back-to-back escrows. Notwithstanding the foregoing, the City shall give Developer at least thirty (30) days prior written notice with respect to the Conveyance of any Navy-Owned Property.
202. Feasibility Period. Commencing on the Date of Agreement and ending on the date that is ninety (90) days after the Date of Agreement (“Feasibility Period”), Developer shall have the right to inspect and review the condition of the Property, determine the suitability of the Property for Developer’s intended use and evaluate all other aspects of development feasibility, including financial viability as set forth in this Section 202. Developer shall have the right during the Feasibility Period to review and approve the Condition of Title as provided in Section 208 below. The Feasibility Period may be extended by the City Manager in their sole discretion.
202.1 Right of Access. From and after the Date of Agreement and thereafter until Closing of the Initial Conveyance has occurred or until the earlier termination of this DDA, Developer, its employees, agents, consultants, lenders, investors, partners, contractors and subcontractors (collectively, “Developer Parties”), shall have the right to enter upon the Property and while thereon make surveys, take measurements, perform test borings or other tests of surface and subsurface conditions, including soils, soil gas and water, make engineering, architectural, environmental and other studies and inspect the Property. Developer agrees to provide notice to the City’s Economic Development Manager and City Clerk at least forty eight (48) hours prior to undertaking any studies or work upon the Property. Developer, at its expense, shall be responsible for obtaining written permission from Navy prior to undertaking any borings, subsurface soil or ground water testing or other invasive investigations on or about the Navy-Owned Property, including any buildings or structures thereon. City agrees to reasonably assist with any such requests for permission. Developer shall provide City with copies of all data, survey and tests which Developer produces in connection with such studies and investigations promptly following receipt thereof. Prior to any entry on the Property by Developer Parties, Developer shall procure and maintain, and cause any other Developer Parties performing work or entering the Property to procure and maintain, commercial general liability, automobile liability and worker’s compensation insurance covering Developer, and naming City and Navy as additional insureds, and otherwise meeting the requirements set forth in Exhibit L.

If Developer exercises its rights of entry under the provisions of this Section 202.1, Developer OAK #4843-5079-9573 v18
21 shall (i) keep the Property free of any liens or third-party claims resulting therefrom; (ii) take all reasonable precautions to prevent the release of any Hazardous Materials into the environment; (iii) indemnify and defend City and Navy against any liability or expense for injuries to or death of persons or damage to property of any nature whatsoever to the extent arising out of or resulting from Developer’s exercise of its rights hereunder; provided that Developer shall have no obligation to indemnify or defend City against any Claims arising from the active negligence or willful misconduct of City or City Parties and, except to the extent Developer’s investigative activities result in a further release of Hazardous Materials onto or about the Property, Developer shall have no responsibility or liability for any Hazardous Materials within, on, above, under, or emanating from the Property which were present before Developer Parties’ entry on the Property; and (iv) if the Closing does not occur for any reason (other than a default by City), restore as nearly as practicable any portion of the Property damaged by such entry substantially to its condition immediately before such entry. The indemnification provisions of this Section shall survive the expiration or termination of this DDA. In addition, if this DDA is terminated for any reason, including a Default by either party or failure of a condition for the benefit of a party, Developer shall promptly repair and/or remedy any damage to any portion of the Property or improvements thereon resulting from such studies and investigations and restore the Property and improvements thereon as nearly as possible to the physical condition existing immediately prior to such damage. Developer’s indemnity and repair/restoration obligations under this Section 202.1 shall survive the expiration or termination of this Agreement. 202.2 Availability of Documents. Developer acknowledges that Navy and DTSC maintain a comprehensive set of data and documents with respect to the Property and the current and former buildings, improvements and facilities on, under and about such Property, which include, among other things, information about the historic uses of such Property and the numerous tests, studies, surveys and plans prepared or performed by or on behalf of Navy related to presence and/or remediation (completed as well as ongoing) of Hazardous Materials.

Developer further acknowledges that City has advised Developer to inspect fully all portions of the Property and investigate all matters relevant thereto and to rely solely upon the results of Developer’s own inspections, which may include inspection of information obtained or otherwise available from the Navy, DTSC EnviroStor (https://dtsc.ca.gov/your-envirostor/) and the RWQCB, rather than any information that may have been provided by City to Developer or information or documents that may be in City files; provided the foregoing shall not be construed as permitting the City to knowingly withhold any such information or documents from Developer.
202.3 Feasibility Approval. If Developer elects to proceed with the purchase of the entirety of the Property after conducting such investigations, then as soon as practicable following completion of such investigations, but in any event no later than expiration of the Feasibility Period, Developer may, in its sole discretion, deliver a written notice of approval (“Notice of Approval”) to City and Escrow Agent. Developer’s failure to give the Notice of Approval prior to 5:00 p.m. Pacific time on the date of the expiration of the Feasibility Period shall not be a Default under this DDA, but will be deemed Developer’s disapproval of the condition of the Property and election not to proceed with the purchase of any portion of the Property and shall serve to terminate this DDA effective as of the expiration of the Feasibility OAK #4843-5079-9573 v18
22 Period. If Developer disapproves or is deemed to have disapproved the condition of the Property, neither party hereto shall have any further obligation or liability to the other with respect to the transactions contemplated by this DDA, except for any obligations or liabilities which expressly survive termination. If Developer gives its Notice of Approval, then this DDA shall continue in effect and the rights and obligations of the parties shall continue to be governed by this DDA. Once Developer has proceeded with Closing with respect to the Initial Conveyance, Developer may not revoke or modify the Notice of Approval with respect to subsequent Conveyances of the Navy-Owned Property following the Initial Conveyance, but such subsequent Conveyances shall nevertheless remain subject to the satisfaction or waiver (by Developer in its reasonable discretion) of all applicable Developer Conditions Precedent with respect thereto.
203. Escrow. Within the time set forth in the Schedule of Performance, Developer shall open an escrow (“Escrow”) for the Conveyances with Melodie Rochelle, Escrow Officer at Fidelity National Title Insurance Company, 2701 Emerywood Parkway, Suite 200, Richmond VA 23294, VA 23294, Telephone: (804) 521-5713, Email: [email protected], or another escrow company mutually acceptable to City and Developer (“Title Company” or “Escrow Agent”).
203.1 Escrow Costs. Any and all fees, charges, and costs for the Escrow, including recording fees, document fees and documentary transfer taxes, if any, related to each Conveyance, shall be paid by Developer.
203.2 Escrow Instructions. This DDA constitutes the joint escrow instructions of Developer and City with respect to the Conveyances, and the Escrow Agent to whom these instructions are delivered is hereby empowered to act under this DDA. The parties shall use reasonable good faith efforts to close each Conveyance in the shortest possible time, subject to the terms of this DDA. Insurance policies insuring the Property, or applicable portion thereof, for fire or casualty are not to be transferred, and City shall cancel its own policies, if any, after each Closing. All funds received in the Escrow shall be deposited in one or more federallyinsured interest-bearing accounts with a state or national bank doing business in the State of California, in interest bearing accounts to the extent elected by the benefitted party. All disbursements shall be made by check or wire transfer from such account. If, in the reasonable opinion of either party, it is necessary or convenient in order to accomplish the Closings, such party may require that the parties sign supplemental escrow instructions; provided that if there is any inconsistency between this DDA and the supplemental escrow instructions, then the provisions of this DDA shall control. Escrow Agent is instructed to release City’s and Developer’s supplemental escrow instructions, if any, and Closing statements to both parties. 203.3 Authority of Escrow Agent. With respect to each Closing, Escrow Agent is authorized to, and shall:
a. Pay and charge Developer for the premium of the Developer Title Policy and pay and charge Developer for the premium of the Survey and/or additional endorsements requested by Developer.

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23 b. Pay and charge Developer for any Escrow fees, charges, and costs payable under Section 203.1.
c. Disburse funds; delivery fully executed counterparts of the Building 571 Remediation Agreement to City and Developer; record the Deed, the Construction Staging Area License, the Irrevocable Offer to Dedicate Roadways, the Sublease, the PILOT Agreement, the Water System Reimbursement Agreement, the Sewer and Storm System Reimbursement Agreement, in the Official Records of Solano County, in that order, and deliver conformed originals of the Deed, Construction Staging Area License, Irrevocable Offer to Dedicate Roadways, Sublease, PILOT Agreement, the Water System Reimbursement Agreement and the Sewer and Storm System Reimbursement Agreement to both City and Developer (and, in the case of the Sewer and Storm System Reimbursement Agreement, to VFWD as well) when both the Developer Conditions Precedent and City Conditions Precedent have been fulfilled or waived in writing by Developer and/or City as applicable. d. Do such other actions as necessary, including issuing the Developer Title Policy(ies), to fulfill its obligations under this DDA. e. Direct City and Developer to execute and deliver any instrument, affidavit, and statement, and to perform any act, reasonably necessary to comply with the provisions of the Foreign Investment in Real Property Tax Act (FIRPTA), if applicable, and any similar state act and regulations promulgated thereunder. f. Prepare and file with all appropriate governmental or taxing authorities a uniform settlement statement, closing statement, tax withholding forms including an IRS 1099 S form, and be responsible for withholding taxes, if any such forms are provided for or required by law.
204. Purchase Price; Deposit.
204.1 Purchase Price. The purchase price for the Property (“Purchase Price”) shall be Three Million and No/100 Dollars ($3,000,000.00). At the Closing of the Initial Conveyance, Developer shall pay to City through Escrow the entire Purchase Price, less the Deposit, in immediately available funds. Except as otherwise provided in Section 204.3 below, no additional purchase monies shall be payable in connection with the subsequent Conveyances following the Initial Conveyance.
204.2 Deposit.
a. Within the time set forth in the Schedule of Performance, the parties shall cause the negotiation deposit in the amount of Fifty Thousand and No/100 Dollars ($50,000.00) previously made by Developer and currently held by City pursuant to the terms of the ERN to be deposited into Escrow and held as the good faith deposit (“Deposit”) for the transactions contemplated by this DDA. Escrow Agent shall place the Deposit with a federallyinsured state or national bank doing business in the State of California, in an interest bearing account, to the extent elected by Developer. All interest thereon shall become part of the OAK #4843-5079-9573 v18
24 Deposit. The Deposit shall be non-refundable except in the event this Agreement is terminated due to a default by City or the failure of any Developer Conditions Precedent. b. If the Initial Conveyance is consummated, then the Deposit (and all accrued interest thereon) shall be applied towards the Purchase Price. c. If the Initial Conveyance is not consummated for any reason other than default by City hereunder or the failure of a Developer Condition Precedent, then City shall retain the Deposit (and all accrued interest thereon) as provided in Section 803 below. d. If the Conveyance is not consummated due to a default by City hereunder or the failure of a Developer Condition Precedent, and Developer has not elected to bring an action for specific performance, then the Deposit (and all accrued interest thereon) shall be refunded to Developer. Nothing herein shall be construed to prevent or limit any of Developer’s rights or remedies provided under Section 802 of this DDA. 204.3 Potential Additional Payment for Property. Additional payments to the City may be required to be made by Developer if, following approval of a New Specific Plan (if any), Developer or its successors obtain approval to increase the permitted density of any portion of Mare Island and such increase results in more development than identified in the New Specific Plan as approved by City. Developer will be required to make any such additional payments to the City following a future agreed upon methodology which methodology will be determined and agreed upon by the parties prior to City Council considering approval of the New Specific Plan, Backbone Infrastructure Plan and any new, revised, amended or extended statutory development agreement relating to any portion of Mare Island. If the parties cannot agree on such methodology at that time, the City in its sole discretion may disapprove any proposed New Specific Plan, Backbone Infrastructure Plan, and any proposed new, revised, amended or extended development agreement on any portion of Mare Island. Nothing herein shall be deemed to prevent the parties from agreeing that no additional payment is owed in connection with a particular density increase proposal. 205. City’s Conditions Precedent to Conveyance. City’s obligation to proceed with each Conveyance is subject to the fulfillment or written waiver by City of each and all of the conditions precedent described below (individually and collectively “City Conditions Precedent”), which are solely for the benefit of City, and which shall be fulfilled or waived within the time periods provided for herein:
205.1 No Default. Developer shall not be in Default under this DDA or any of the other Transaction Documents, and no event shall have occurred which, with the passage of time or giving of notice or both, would constitute a Default by Developer under this DDA or the other Transaction Documents.
205.2 Developer Representations. The representations and warranties of Developer shall be true and correct in all material respects as of the Closing Date.

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25 205.3 Execution of Documents. Developer shall have executed and delivered into Escrow two counterparts of the Building 571 Remediation Agreement and shall have executed, acknowledged and delivered into Escrow, the Deed, the Construction Staging Area License, the Irrevocable Offer to Dedicate Roadways, the PILOT Agreement, the Water System Reimbursement Agreement, the Sewer and Storm System Reimbursement Agreement, and, in the case of the Closing of the Initial Conveyance, the Sublease, and such other documents required to close Escrow in accordance with the terms of this Agreement. 205.4 Purchase Price. Developer shall have deposited into Escrow all Closing costs and, in the case of the Closing of the Initial Conveyance, the full amount of the Purchase Price, less the Deposit.
205.5 City Demolition Permits. With respect to the Closing of the Initial Conveyance, Developer shall have submitted applications for, and City shall have issued, or shall be ready to issue upon payment of applicable fees and completion of any required environmental review, demolition permits with respect to all of the Non-Utilized Structures. 205.6 Navy PERF Approval. With respect to Closing of the Initial Conveyance, Developer shall have submitted to Navy a Project Environmental Review Form (PERF) and, if and to the extent required, obtained written approval thereof from Navy to perform that portion of the Demolition Work applicable to the Navy-Owned Property. 205.7 Demolition Contract. With respect to Closing of the Initial Conveyance, Developer shall have entered into a demolition agreement for the Demolition Work with a licensed demolition contractor reasonably acceptable to City and shall have provided a copy of such agreement to the City.
205.8 Demolition Bonds. With respect to Closing of the Initial Conveyance, Developer shall have obtained labor and materials and performance or completion bonds in forms reasonably acceptable to City to guaranty payment of laborers and material providers and completion of the Demolition Work within the times provided in the Schedule of Performance, subject to delays resulting from Force Majeure Conditions. 205.9 Intentionally Omitted.
205.10 Non-Exclusive License Agreement. The Non-Exclusive License Agreement between City and Developer shall be in full force and effect, Developer shall not be in default under such agreement beyond all applicable notice and cure periods. 206. Developer’s Conditions Precedent to Conveyance. Developer’s obligation to proceed with each Conveyance is subject to the fulfillment or written waiver by Developer of each and all of the conditions precedent described below (individually and collectively, “Developer Conditions Precedent”), which are solely for the benefit of Developer, and which shall be fulfilled or waived within the time periods provided for herein:

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26 206.1 Execution of Documents. City shall have executed and delivered into Escrow two counterparts of the Building 571 Remediation Agreement and shall have executed and acknowledged the Deed, and executed and where appropriate acknowledged such other documents and agreements required for the applicable Closing, and shall have delivered the Deed and such other Closing documents into Escrow.
206.2 No Default. City shall not be in Default under this DDA or any of the other Transaction Documents, and no event shall have occurred which, with the passage of time or giving of notice or both, would constitute a Default by City under this DDA or the other Transaction Documents.
206.3 Review and Approval of Title. Developer shall have reviewed and approved the Condition of Title with respect to that portion of the Property subject to the applicable Conveyance, in accordance with the terms of this Agreement. 206.4 Developer Title Policy. The Title Company shall, upon payment of Title Company’s regularly scheduled premium, be ready to issue to Developer an ALTA owners policy of title insurance (“Developer Title Policy”), together with such endorsements as are reasonably requested by Developer, insuring that Developer has a valid fee interest in the Property, or applicable portion thereof, subject to the Condition of Title as approved by Developer in accordance with the terms of this Agreement. The premium for the Developer Title Policy, plus any additional costs, including the cost of surveys and any endorsements requested by Developer, shall be paid by Developer. Notwithstanding the foregoing, at Developer’s election in its sole discretion, the term “Developer Title Policy” shall also include a leasehold policy with respect to each Sublease.
206.5 City HUD 108 Loan. With the respect to the Initial Conveyance, the City’s HUD 108 Loan shall have been paid in full or shall be ready to be paid in full through Closing for the Initial Conveyance, and the HUD Security Documents shall have been fully terminated, released and/or reconveyed, as applicable, through such Closing or prior thereto, and the City shall have taken all such other actions as may be required to cause the release of any liens and encumbrances of any kind relating to the City’s HUD 108 Loan. 206.6 City Representations. The representations and warranties of the City shall be true and correct in all material respects as of the Closing Date. 206.7 Notice of Approval. With respect to the Initial Conveyance only, Developer shall have delivered the Notice of Approval to City and Escrow Agent. Developer’s delivery of the Notice of Approval with respect to the Initial Conveyance shall be deemed Developer’s Notice of Approval as to all subsequent Conveyances; provided the foregoing shall not in any way be deemed a waiver by Developer of any other of these Developer Conditions Precedent.
207. Closing. The Initial Conveyance of the City-Owned Property shall close within thirty (30) days after the satisfaction or written waiver by the applicable party, of all of City’s Conditions Precedent and Developer’s Conditions Precedent to the Initial Conveyance, but in OAK #4843-5079-9573 v18
27 any event no later than one hundred twenty (120) days after the Date of Agreement, or such later date as the parties may agree, each in its sole, absolute discretion (“Outside Date for Initial Conveyance”). The Outside Date for Initial Conveyance shall also be subject to extension for Force Majeure Conditions; provided, however, the total Force Majeure Conditions-related extension shall in no event extend beyond December 31, 2022. The subsequent Conveyance or Conveyances of the Navy-Owned Property, or applicable portion thereof, shall close concurrently with the closing for City’s acquisition from the Navy of the Navy-Owned Property or applicable portion thereof, through back to back escrows, in all events subject to the requirements set forth above for prior written notice to Developer and further subject to the satisfaction or written waiver by the applicable party, of all of the applicable City’s Conditions Precedent and Developer’s Conditions Precedent with respect to each such Conveyance. “Closing” means the closing of Escrow for each Conveyance. “Closing Date” means the day on which the applicable Closing occurs.
208. Review and Approval of Condition of Title.
208.1 Pre-Approved Exceptions. Within twenty (20) business days after the Date of Agreement, Developer shall cause Title Company or another title company mutually acceptable to City and Developer, to deliver to Developer and City a preliminary title report (“Title Report”) with respect to the entirety of the Property, together with legible copies of all the documents underlying the exceptions set forth in the Title Report. Developer shall have the right to request that an ALTA Survey (“Survey”) be prepared, at Developer’s sole cost and expense. Developer shall have the right to approve or disapprove all exceptions in its sole and absolute discretion; provided, however, Developer hereby approves the following exceptions which shall be referred to herein as the “Pre-Approved Exceptions”: (a) the lien of any nondelinquent property taxes and assessments, including the lien for the Existing CFDs and, if formed, the New CFD(s); (b) the City’s rights under the Construction Staging Area License; (c) the covenants in the Navy Quitclaim Deed(s); (d) the terms and conditions of the existing FOST(s) and any new Findings of Suitability for Transfer issued by DTSC or other environmental regulatory agencies in connection with Navy’s conveyance of the Navy-Owned Property to City; (e) any and all CRUP(s) executed by City or Navy in implementation of the existing FOST(s) or any new Findings of Suitability for Transfer; (f) the covenants in the Deed; (g) the Irrevocable Offer to Dedicate Roadways; (h) the DDA; (i) the PILOT Agreement; (j) the State Lands Settlement Agreement; (k) the Water System Reimbursement Agreement; (l) the Sewer and Storm System Reimbursement Agreement; and (m) matters created by, through, under or as a result of the actions of Developer or any Developer Parties. 208.2 Approval and Disapproval Process. No later than sixty (60) days (“Title Review Period”) after the later of Developer’s receipt of the Title Report, Survey (if requested by Developer), and copies of all of the documents underlying the exceptions, Developer shall give City and Escrow Agent written notice (“Title Notice”) of Developer’s approval or disapproval of the legal description and every item or exception disclosed by the Title Report and Survey, if any, and of any title insurance endorsements which Developer requires, provided Developer shall be deemed to have approved the Pre-Approved Exceptions. Developer’s failure to give such Title Notice to City within the Title Review Period shall be deemed Developer’s disapproval of OAK #4843-5079-9573 v18
28 the condition of title to the Property and election to terminate this Agreement. In the event Developer disapproves of any title matter (other than the Pre-Approved Exceptions) shown in the Title Report, City shall, within twenty (20) days after receipt of the Title Notice give Developer written notice (“City’s Response”) of those disapproved title matters, if any, which City is unable or unwilling to eliminate as of Closing. City’s failure to give City’s Response within such time period shall be deemed City’s notice that it will not eliminate any of the disapproved title matters. Developer shall notify City in writing, within ten (10) days after receipt of City’s Response (or within ten (10) days after City is deemed to have refused to eliminate title matters to which Developer has objected) whether Developer is willing to purchase the Property subject to such disapproved exceptions, or is electing to terminate this DDA (“Developer’s Response”).

If Developer so elects to terminate this DDA, Escrow Agent shall immediately disburse the Deposit to City. The failure of Developer to give Developer’s Response to City shall be deemed Developer’s election to terminate this Agreement. City, at Developer’s cost and expense, shall cause any disapproved title matters that City has not objected to in City’s Response, if any, to be removed from title prior to Closing. All monetary liens and exceptions, including without limitation any liens or other exceptions relating to the HUD 108 Loan (collectively, “Monetary Liens”) shall be automatically deemed rejected by Developer. 208.3 New Exceptions. The Pre-Approved Exceptions, together with those exceptions to title approved by Developer as provided herein, are individually and collectively referred to as the “Condition of Title.” If any new exceptions other than Pre-Approved Exceptions, or changes with respect to any other exceptions previously approved pursuant to this Section 208 are reported by the Title Company after Developer has approved the Condition of Title pursuant to the foregoing procedures, then any such new exception or changes to an existing exception shall be subject to the same procedures for review and approval set forth above.
209. Property Taxes and Assessments. All ad valorem taxes and assessments, including Existing CFD Special Taxes, levied, assessed or imposed on the Property or part thereof for any period prior to Closing of the Initial Conveyance shall be borne by City. Ad valorem taxes and assessments, including Existing CFD and, if applicable, New CFD Special Taxes, levied or imposed on the Property or part thereof for the period from and after Closing of the Initial Conveyance, and any taxes upon this DDA or the Conveyances, shall be paid by Developer as provided herein and in the Sublease. Developer acknowledges that the Existing CFDs, including CFD 2002-1, impose different special tax rates on property depending upon status and characterization of the property, as provided in the rates and methods of apportionment adopted in connection with the Existing CFDs. If the Closing of the Initial Conveyance occurs on a date other than the first day of the property tax year, the Existing CFD Special Tax payments for the first year shall be prorated between the parties based upon a three hundred sixty-five-(365) day year.
210. Environmental Matters.
210.1 Building 571 Remediation Agreement. As set forth in the Building 571 Remediation Agreement, Developer, during performance of its due diligence work has identified OAK #4843-5079-9573 v18
29 the presence of PCB contaminated soils near the surface of the site of the former Building 571.

City believes that the existence of such contamination within upper most soil levels of the Building 571 site was the result of demolition of former Building 571 and distribution of debris from that activity (“PCB Contaminated Debris”) across the surface of the former Building 571 site. City has notified the City contractors and subcontractors responsible for performance of Building 571 demolition work, including pre-demolition building inspection, of the issue. City shall retain all rights and remedies City has or may have against such contractors and subcontractors, including the right to recover damages from and against such contractors and subcontractors, and Developer shall have no right to share in any damage awards or settlements that City may receive in connection with City’s pursuit of claims against such contractors and subcontractors, if any. Notwithstanding the foregoing, to the extent City’s contractor (and Developer’s contractor in the case of importation of Clean Fill to replace removed soil) has not completed the work of remediating and removing the PCB Contaminated Debris at the former Building 571 site (“Building 571 Remediation Work”) in accordance with a work plan approved by DTSC (or other applicable regulatory agency) prior to the Closing of the Initial Conveyance, City and Developer shall enter into a Building 571 Remediation Agreement in substantially the form attached hereto as Exhibit S which, among other things, will commit City, at its expense (except to the extent City recovers all or a portion of the costs from the contractors and subcontractors noted above), to complete the Building 571 Remediation Work (other than importation of Clean Fill to replace removed soil, which fill importation shall be performed by Developer at its expense), in accordance with the DTSC-approved work plan, all as more particularly set forth in the Building 571 Remediation Agreement. Except as expressly set forth in this Section 210.1 and the Building 571 Remediation Agreement, from and after the Closing, City shall have no obligations with respect to Hazardous Materials that may be located on, under or about the Property.
210.2 No Warranties as to Property. Developer is purchasing the Property on the basis of Developer’s own investigation of the physical and environmental conditions of the Property and the buildings, improvements and facilities thereon, including subsurface facilities and ground water and soils conditions. Subject to any Navy obligations under the Navy Deed Covenants, Developer assumes the risk that adverse physical and environmental conditions may not have been revealed by its own investigation, and each portion of the Property, including the buildings, improvements and facilities thereon shall be conveyed by City to Developer in its “AS-IS” condition, “WITH ALL FAULTS,” including the presence of Hazardous Materials (whether or not revealed by Developer’s due diligence investigations) and any violations of Applicable Laws, including Environmental Laws, with no warranty expressed or implied by City regarding the presence of Hazardous Materials or the condition of the soil, its geology, the presence of known or unknown seismic faults, title to the Property or the suitability of the Property, or the buildings, improvements or facilities thereon for Developer’s intended development.
210.3 Waiver and Release. Except as otherwise expressly set forth in Section 210.1 above and in the Building 571 Remediation Agreement, effective as of each Closing Date, Developer hereby waives, releases and discharges forever City Parties from any and all present and future Claims arising out of or in any way connected with the condition of the Property or OAK #4843-5079-9573 v18
30 applicable portion thereof, any Hazardous Materials on, under or about the Property or applicable portion thereof however they came to be placed there, or the release of Hazardous Materials from the Property or applicable portion thereof. Developer is aware of and familiar with the provisions of California Civil Code section 1542, which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE

CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO

EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE

RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE

MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR OR RELEASED PARTY.”
As such relates to this Section 3, Developer hereby waives and relinquishes all rights and benefits that it may have under California Civil Code section 1542. 210.4 Obligations with Respect to Hazardous Materials after Closing.

Developer acknowledges and agrees that additional Hazardous Materials remediation work beyond that performed by or on behalf of the Navy (or by or on behalf of City in the case of the Building 571 Remediation Work) , including abatement and removal of asbestos, lead paint and PCB’s located on and within buildings and related improvements, remediation of the cistern/vault discovered within Building 641, and remediation of potential PCB contamination that may have resulted from any cause, including City’s prior demolition of PCB-contaminated pad(s) or other contaminated structures or foundations located on or about the Property (other than the Building 571 pad), may have to be performed in order to develop the Property.

Developer, at its expense, shall be responsible for all environmental remediation and response actions that are not the responsibility of the Navy under the Navy Deed Covenants or City under the Building 571 Remediation Agreement. Before undertaking any Site Preparation Work or other horizontal or vertical development work on or about the Property, Developer shall, at its sole cost and expense, promptly take all actions required by Environmental Laws and otherwise under this DDA. Except to the extent of Navy’s responsibilities under the Navy Deed Covenants and City’s limited obligations under the Building 571 Remediation Agreement, Developer, at its expense, shall take all actions necessary to promptly restore the Property to an environmentally sound condition for the uses contemplated by the New Specific Plan or, if the proposed New Specific Plan is not approved by City, the Existing Specific Plan. Except as otherwise expressly set forth in Section 210.1 above and in the Remediation Agreement, it is expressly understood and agreed the City shall have no obligation whatsoever with respect to any Hazardous Materials that may be located on, under or about the Property, including any buildings or structures thereon, regardless of whether the existence of such Hazardous Materials is discovered before or after Closing. Nothing herein shall be deemed to relieve Navy of its obligations under the Navy Deed Covenants. Developer’s and City’s obligations under this Section 210, including subsections 210.1 through 210.7 shall survive the Closing and expiration or termination of this DDA.
210.5 Duty to Prevent Further Hazardous Materials Contamination. Both before and after each Closing, Developer shall take all necessary precautions to prevent the OAK #4843-5079-9573 v18
31 release of any Hazardous Materials into the environment. Such precautions shall include compliance with all Environmental Laws. In addition, Developer shall install and utilize such equipment and implement and adhere to such procedures as are consistent with Environmental Laws as to disclosure, storage, use, removal and/or disposal of Hazardous Materials. 210.6 Environmental Inquiries. Both before and after each Closing, Developer shall notify City, and provide to City a copy or copies, of any and all environmental permits, disclosures, applications, entitlements, or inquiries relating to the Property or applicable portion thereof, 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 Environmental Laws. 210.7 Notice of Hazardous Materials Release. In the event of a release of any Hazardous Materials onto or from the Property or any portion thereof, Developer shall, as soon as possible after the release, furnish to City a copy of any and all reports relating thereto and copies of all correspondence with regulatory agencies relating to the release. Developer shall immediately furnish to City a copy or copies of any and all other environmental entitlements or inquiries relating to or affecting the Property or any portion thereof, including all permit applications, permits, and reports, including those reports and other matters which may be characterized as confidential.
300. DEVELOPER’S POST CLOSING COVENANTS
301. Scope and Schedule for Developer’s Work. Developer shall commence and complete each component of Developer’s Work, consisting of the Demolition Work, Soil Testing, Connolly Corridor Development Work, Planning Work (including New Specific Plan and Beautification Plan), Beautification Work and Site Preparation Work, all as provided in the Scope of Work, within the times established therefor in the Schedule of Performance, subject to delays caused by Force Majeure Conditions as provided in Section 1002. The Schedule of Performance is subject to revision from time to time as mutually agreed upon in writing between Developer and the City Manager, and in all events shall be revised as reasonably required and agreed to by the parties, working in good faith, to address any delays caused by Force Majeure Conditions.
301.1 Reservation of City’s Right to Pursue New Specific Plan. Nothing herein shall be deemed to prohibit City from pursuing approval of a new specific plan with respect to the entirety of Mare Island as allowed by applicable law, if within the time set forth in the Schedule of Performance, Developer fails to obtain City approval of a New Specific Plan as contemplated by this Agreement; provided, however, the effect of any new City-initiated specific plan with respect to South Mare Island shall be subject to Developer’s vested rights under the South Mare Island Development Agreement for the remaining term of such agreement. 302. Cost of Work. All costs related to Developer’s Work and all further planning, design, and development work with respect to the Property, including costs of constructing and installing Backbone Infrastructure and complying with all required mitigation measures and any development project conditions of approval, shall be borne solely by Developer.

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32 303. Permits and Approvals. Developer, at its expense, shall secure or cause to be secured any and all land use and other entitlements, permits and approvals which may be required by City and any other governmental agency having jurisdiction over development of the Property or applicable portion thereof. The approval of this DDA by City does not constitute the granting of, or a commitment to obtain, any required land use permits, entitlements or approvals for development.
304. Consultation and Coordination. During the preparation of the proposed New Specific Plan and Beautification Plan, staff of City and Developer shall hold progress meetings on an as needed basis to coordinate the preparation, submission, and review of such plans. The staff of City and Developer shall communicate and consult informally as frequently as is necessary to ensure that the formal submittal of any complete documents to City can receive timely and thorough consideration in accordance with City policies. City shall not be responsible either to Developer or to any third parties in any way for any delays caused by the review and approval processes established for City’s review and consideration of any Future Applications, including applications with respect to the proposed New Specific Plan and Beautification Plan.
305. Rights of Access. Prior to completion of development of the Property, City representatives shall have the reasonable right of access to the Property with prior notice to Developer, without charges or fees, at normal construction hours, and after consultation with Developer to avoid any interference with Developer’s activities. So long as City does not unreasonably interfere with Developer’s activities during any such entries, Developer hereby waives any and all Claims that City’s access to the Property may interfere with Developer’s obligations under this DDA or any of the Transaction Documents, or delay Developer’s performance thereof. Nothing herein shall be deemed to limit the ability of City to conduct code enforcement and other administrative inspections of the Property in accordance with Applicable Laws. City employees, agents and assigns that are not involved in conducting code enforcement and/or inspection of the Property shall give Developer a minimum of 24 hours advance notice (except in case of emergency) and coordinate any physical access to the Property through Developer or its agents, contractors or assigns and shall observe property safety protocol at all times.
306. Compliance with Laws. Developer, at its expense, shall carry out its obligations under this DDA and any future development of the Property in conformity with all applicable laws, ordinances, statutes, codes, orders, decrees, rules, regulations, official policies, standards and specifications (including any ordinance, resolution, rule, regulation, standard, official policy, condition, or other measure) of the United States, the State of California, the County of Solano, the City, and any other political subdivision in which the Property is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over City, Developer, the Property or Developer’s Work, including all Environmental Laws and applicable provisions of CEQA and NEPA; any orders, permits, requirements and approvals of the San Francisco Bay Conservation and Development Commission, DTSC and/or the RWQCB; any and all agreements or approvals from the State of California State Lands Commission and/or the Navy; and any amendments of any of the foregoing (all of the foregoing, collectively, “Applicable Laws”).

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33 307. Prevailing Wages. If and to the extent applicable, Developer shall comply, and shall ensure that its contractors and subcontractors comply, with California Labor Code Section 1720 et seq., including implementing regulations of the Department of Industrial Relations, applicable to public works and payment of prevailing wages, as well as all applicable Federal prevailing wage laws, including the Davis-Bacon Act of 1931, as amended, and implementing regulations (collectively, “Prevailing Wage Laws”) in connection with development of the Property. Without limiting the generality of the foregoing, Developer shall (i) require its contractors and subcontractors to submit certified copies of payroll records to Developer; (ii) maintain complete copies of such certified payroll records; and (iii) make such records available to City and its designees for inspection and copying during regular business hours at the Property or at another location within the City of Vallejo, or deliver copies thereof to City. Developer shall defend (with counsel reasonably acceptable to City), indemnify and hold harmless City and City Parties from and against any and all present and future Claims to the extent arising out of Developer’s failure to comply with all Prevailing Wage Laws, including any and all Claims that may be asserted by contractors, subcontractors or other third party claimants pursuant to California Labor Code Sections 1726 and 1781. Developer hereby waives, releases and discharges City and its employees, officers, volunteers, agents and representatives, from any and all present and future Claims arising out of or in any way connected with Developer’s failure to comply and to cause its contractors and subcontractors to comply with all Prevailing Wage Laws in connection with construction and development of the Property. Developer’s obligations under this Section 307 shall survive the expiration or termination of this DDA. 308. Local Economic Benefits. In connection with the development of the Property, Developer and its successors and assigns and its and their contractors and subcontractors shall comply with the Local Economic Benefit Program Requirements set forth in Exhibit M attached hereto. Developer and its successors and assigns shall report to City the results of its compliance with the Local Economic Benefit Program Requirements not less than annually. Developer’s obligations under this Section 308 and Exhibit M shall survive the Closing and the issuance of the Certificate of Completion.
309. Existing and New Services CFDs; Funding of Services. 309.1 New Community Facilities District Formation. Subject to the terms of this Section 309, the parties shall cooperate in good faith to establish New CFD(s) to replace the Existing CFDs and finance the provision of those CFD Services on Mare Island that may lawfully be financed under the Mello-Roos Act, as implemented and modified by Municipal Code Chapter 14.45 (the City of Vallejo-Mare Island Services Financing Code or the “Financing Code”), as amended from time to time. The boundaries of the New CFD(s) shall include, among other Mare Island properties, the entirety of the Property and South Mare Island Property, unless the parties otherwise agree. At any time following the Date of Agreement, the City Council may consider adoption of one or more resolutions of intention to establish the New CFD(s). In the event City Council adopts such resolution(s) of intention, then, City shall be responsible for conducting all proceedings for the establishment of the New CFD(s), including the adoption of all resolutions, ordinances and orders and recording of maps, notices, releases and the conduct of all hearings, elections and other public meetings under the Mello-Roos Act OAK #4843-5079-9573 v18
34 and Financing Code to establish the New CFD(s) and levy the Special Tax(es) to fund the provision of CFD Services. Developer shall cooperate with City in the formation of the New CFD(s) by timely submitting to City all petitions, waivers and consents reasonably necessary to facilitate formation of the New CFD(s) and imposition of a levy of Special Taxes on the entirety of the Property and all portions of the South Mare Island Property owned by Developer or any Affiliate of Developer.
309.2 Special Tax. The New CFD(s) shall be authorized to levy, and Developer shall approve (by affirmative vote or other legally acceptable method), Special Taxes in accordance with the rate and method of apportionment approved in the completed proceedings for the New CFD(s). The Special Taxes shall be determined and collected by the City biannually as part of the County tax billings against all taxable parcels as defined by the rate and method of apportionment of the Special Taxes for the New CFD(s). The Special Taxes shall be set at an amount sufficient to fund the provision of the CFD Services to be funded by the New CFD(s), together with the annual costs of calculation, collection and disbursement of the Special Taxes and the annual administration costs associated with the New CFD(s). 309.3 Notification of Taxes. Developer shall provide actual and conspicuous notice to potential residential and commercial property purchasers, in a form reasonably acceptable to the City and in compliance with all applicable legal requirements (including, without limitation, applicable provisions of Government Code Section 53341.5) of any and all Special Taxes to be charged to any and all purchasers of the Property or applicable portion thereof. The written notice shall specify the maximum special tax that will apply to property in the Existing CFD(s) or New CFD(s), as applicable, and the escalator that will increase the maximum tax rate on an annual basis to the prospective purchaser, which notice the prospective purchaser shall sign. Developer shall retain a copy of each signed notice in Developer's files for at least ten (10) years following the date of such notice, and provide a copy of each such signed notice to the City's Planning and Development Services Director. 309.4 Annexation into Existing CFDs if New CFD(s) are Not Formed. If by the earlier of the date on which a New Specific Plan is approved or the date of conveyance of the last Navy-Owned Property parcel, or such later date as the parties may mutually agree, the New CFD(s) have not been formed for any reason, Developer, upon request by City, shall submit petitions, waive procedures, confirm consent and acceptance and execute such other documents and take such further actions as may be necessary to effect annexation of the entirety of the Navy-Owned Property into the Existing CFDs and the City-Owned Property into CFD 2005-1A and CFD 2005-1B. Upon annexation of the Navy-Owned Property to the Existing CFDs Developer agrees that such property shall be subject to all Special Taxes then or thereafter in effect levied pursuant to the rate and method of apportionment adopted in connection with the Existing CFDs. Developer acknowledges and agrees that City, may, subject to Applicable Laws, adopt higher maximum special tax rates on the Navy-Owned Property than on other properties in the Existing CFDs to the extent there is any increased cost of providing services to the NavyOwned Property in accordance with Section 53339.3(d) of the Mello-Roos Act. Developer irrevocably consents to re-characterization of the land use category and imposition of the OAK #4843-5079-9573 v18
35 Existing CFD Special Taxes against each portion of the Navy-Owned Property, and agrees not to protest or object to such imposition.
309.5 City's Reservation of Discretion. It is expressly acknowledged, understood and agreed by the parties that (i) City reserves full and complete discretion with respect to legally required findings that must be made in connection with the proposed formation of New CFD(s) or annexation into the Existing CFDs, (ii) nothing in this Agreement is intended to or shall limit City's ability to adopt legally required findings with respect to formation of the New CFD(s) or annexation of the Navy-Owned Property into the Existing CFDs, and (iii) nothing in this Agreement is intended to or shall prejudge or commit to City regarding the findings and determinations to be made with respect thereto. 309.6 Developer’s Consent and Cooperation. In connection with the establishment and implementation of the New CFD(s) or, in the alternative, annexation of the Navy-Owned Property into the Existing CFDs and annexation of the City-Owned Property into CFD 2005-1A and CFD 2005-1B, Developer will execute all necessary petitions and ballots and waive all election waiting and protest periods upon City's request and prior to the issuance of any building permit for any development on the Property. With respect to formation of the New CFD(s) if City elects to pursue that option, Developer irrevocably consents to the formation of the New CFD(s), the imposition of the Special Taxes against the Property and South Mare Island Property at rates and pursuant to a method of apportionment appropriate to fund the provision of CFD Services on Mare Island, and agrees not to protest or object to formation of the New CFD(s) or levy of appropriate Special Tax(es) consistent herewith. If City opts not to form one or more New CFDs to replace the Existing CFDs then Developer (i) irrevocably consents to annexation of the Navy-Owned Property into the Existing CFDs and annexation of the CityOwned Property into CFD 2005-1A and CFD 2005-1B, the imposition of Existing CFD Special Taxes against the Navy-Owned Property and imposition of CFD 2005-1A and CFD 2005-1B Special Taxes against the City-Owned Property at rates and pursuant to the rates and methods of apportionment of the Existing CFDs or CFD 2005-1A and CFD 2005-1B, as applicable; and (ii) agrees not to protest or object to annexation of the Navy-Owned Property into the Existing CFDs or annexation of the City-Owned Property into CFD 2005-1A and CFD 2005-1B or the levy of appropriate Special Taxes consistent with the Existing CFDs and CFD 2005-1A and CFD 2005- 1B, as applicable. Developer has agreed to the financing provisions set forth in this Section 309 and to perform the obligations hereunder in exchange for City’s agreement, subject to the terms and conditions hereof, to convey the Property to Developer. 309.7 Advance of Expenses; Reimbursement. As part of its obligation to pay all City Costs as provided in Section 601 below, Developer shall advance to City the actual out of pocket costs of formation of each New CFD and/or annexation into each Existing CFD. Such advanced costs may include (a) in the case of formation of any New CFD(s), the legal, financial, appraisal and engineering costs and expenses associated with (i) determination of the rate and method of apportionment and levy of the Special Taxes with respect to each New CFD, (ii) determination of the value of property, and (iii) any other costs or expenses reasonably incurred in connection with the New CFD(s); and (b) in the case of annexation of the Navy-Owned Property into the Existing CFDs and annexation of the City-Owned Property into CFD 2005-1A OAK #4843-5079-9573 v18
36 and CFD 2005-1B, the legal, financial, appraisal and engineering costs and expenses associated with such annexations.
309.8 Limited Liability of City. Notwithstanding any other provision of this Agreement, City shall not be liable for or obligated to pay any costs or expenses in connection with formation of, or failure to form, any New CFD(s) or, if one or more New CFD(s) are not established, annexation of the Navy-Owned Property into the Existing CFDs and annexation of the City-Owned Property into CFD 2005-1A and CFD 2005-1B. 309.9 Owner’s Association Financing Mechanism for Public Services. If, for any reason, New CFD(s) have not been formed or, alternatively, annexation of the Navy-Owned Property into the Existing CFDs and annexation of the City-Owned Property into CFD 2005-1A and CFD 2005-1B has not been completed, or Existing CFDs or New CFD(s) have been challenged or repealed, at the time Developer applies to City for permits and entitlements for vertical development on the Property (or portion thereof), then, City, at its option, may require Developer, prior to issuance of any final map or building permit, to prepare for review and approval a plan for establishment of one or more property owner associations to ensure payment of the on-going costs of services that would otherwise have been funded through the Existing CFD(s). In proposing a particular plan to City, Developer shall demonstrate to the satisfaction of City Manager and City Attorney, or their designee (in their reasonable discretion) that funding of such on-going services costs is assured. The property owner association(s) (and not City) shall be solely responsible for bearing all costs in connection with the provision of such services. City shall be named as an express third party beneficiary under all owner association documents with the right to independently enforce such associations' obligation to pay all costs of such services.

The form of Developer's owner association documents, including conditions, covenants and restrictions, shall be subject to review and approval by the City Manager and City Attorney. 309.10 Survival of Obligations. Developer’s obligations under this Section 309 shall survive the Closings and the expiration or termination of this Agreement. 310. Minimum Assessed Value/Property Tax Covenant. As more specifically set forth in the PILOT Agreement, Developer on behalf of itself and its successors and assigns agrees that the assessed valuation of the Mare Island Property on the Minimum Tax Revenue Date (as defined in the PILOT Agreement) will equal or exceed the Minimum Owner Property AV (as defined in the PILOT Agreement) and if not, then Developer and/or its successor(s) will pay City and VUSD beginning on July 1st of the year following the Minimum Tax Revenue Date and each year thereafter, an amount equal to the difference between the property taxes actually received by City and VUSD based on the assessed value of the Property and applicable portions of the South Mare Island Property for the tax year in question and the property taxes that City and VUSD would have received if the total assessed value of the Property and applicable portions of the South Mare Island Property had been equal to the Minimum Owner Property AV as increased annually as provided in the PILOT Agreement. Developer’s obligations set forth in this Section shall survive the Closings and shall be set forth in the PILOT Agreement to be recorded against the City-Owned Property and Navy-Owned Property, or applicable portion thereof, at the time of each Conveyance.

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37 311. Irrevocable Offer to Dedicate Roadways. As more fully set forth in the Irrevocable Offer to Dedicate Roadways, Developer at the time of each Conveyance shall irrevocably offer to dedicate to City the roadways, public rights-of-way, and other items described more completely in the Irrevocable Offer to Dedicate Roadways, located on and about the Property and ancillary easements with respect thereto. The specific dedications, and respective rights, obligations and liabilities relating thereto, are more specifically set forth in the Irrevocable Offer to Dedicate Roadways attached as Exhibit N hereto. At the time new roadways and street and pedestrian improvements and easements with respect to same are accepted by City, the prior applicable Irrevocable Offer to Dedicate Roadways shall be deemed to have been rejected and terminated, and upon request by Developer, City shall execute such documents as are reasonably necessary to memorialize termination of such prior Irrevocable Offer to Dedicate Roadways.
312. City of Vallejo Business License. Developer, at its expense, shall obtain and maintain a City of Vallejo business license at all times, and shall include a provision in all contractor agreements for development of the Property requiring each such contractor to obtain and maintain a City of Vallejo business license during performance of the work of construction.

The provisions of this Section shall survive the Closings. 313. Construction and Equipment Sales and Use Tax. Developer shall include in the construction contract with its general contractor(s) provisions that will, to the extent allowed by Applicable Laws, require the general contractor and its subcontractors and suppliers with contracts valued at $5,000,000 or more, to (a) obtain a use tax direct payment permit; (b) elect to obtain a subcontractor permit for the job site; or (c) otherwise designate the Property as the place of use of material used in the construction and development of the Property in order to have the local portion of the sales and use tax distributed directly to City instead of through the countywide pool. Developer shall instruct its general contractor(s) to, and cause such general contractor(s) to instruct its/their subcontractors to, cooperate with City to ensure the local sales/use tax derived from construction and development of the Property is allocated to City to the fullest extent possible. To assist City in its efforts to ensure that such local sales/use tax is so allocated to City, Developer, on an annual basis during time periods when no construction is ongoing and quarterly when construction activities are underway, shall provide City with such information as shall be reasonably requested by City regarding subcontractors working on any development project on the Property with contracts in excess of the amount set forth above, including a description of all applicable work and the dollar value of such subcontracts. City may use such information to contact each subcontractor who may qualify for local allocation of use taxes to City. The provisions of this Section shall survive the Closings. 314. Fees of Other Agencies. Developer shall be responsible for timely payment of all other applicable agencies’ impact fees, exactions, connection fees and other developmentrelated fees, including fees imposed by the County of Solano, VFWD, the Greater Vallejo Recreation District (GVRD), VUSD and any other applicable agencies. The provisions of this Section shall survive the Closings.

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38 315. Limitations on Development under Existing Specific Plan. Except as otherwise expressly provided below, beginning on the Date of Agreement and continuing until such time as Developer has prepared and submitted a New Specific Plan to City for consideration and potential approval, and obtained City’s approval of such New Specific Plan (the “Interim Planning Period”), Developer, on behalf of itself and its successors and assigns, agrees that development of the Property and South Mare Island Property under the Existing Specific Plan and South Mare Island Property Documents shall be limited as set forth in this Section 315. During the Interim Planning Period, Developer may pursue development of the Property in accordance with the Existing Specific Plan; provided, however, the following uses shall be prohibited: liquefied natural gas (LNG) facilities, cement batch plants, dumps and heavy recycling facilities, refineries, heavy industrial uses, and cannabis cultivation and dispensary facilities. Additionally, during the Interim Planning Period Developer further agrees not to pursue development of more than 370,000 square feet of warehouse uses on the Property which is the maximum amount allowed under the Existing Specific Plan. All warehouse buildings and facilities constructed during the Interim Planning Period, if any, shall be designed and constructed in a manner to enable conversion and reuse of such buildings and facilities to mixeduse or residential use at a later date. Notwithstanding any provision of the South Mare Island Documents to the contrary, Developer further agrees that for the duration of the Interim Planning Period, Developer’s development activities on the South Mare Island Property shall be limited to performance of Connolly Corridor Development Work and subdivision of parcels for Buildings 45, 65 and 459. The development activities permitted on the Property and South Mare Island Property during the Interim Planning Period as described above are referred to collectively herein as the “Interim Permitted Specific Plan Development”. The interim restrictions on development of the Property and South Mare Island Property set forth in this Section 315 shall expire upon the earlier of Final approval of the proposed New Specific Plan or when all of the following conditions have been satisfied: (i) Developer has submitted a proposed New Specific Plan to City Council for consideration and potential approval; (ii) Final approval of Developer’s proposed New Specific Plan has not occurred within two (2) years following that date on which such plan was presented to the City Council following such application being deemed complete by City’s Planning and Development Services Department; (iii) City has opted not to send Notice of Intent to Developer by the fifth (5th) anniversary of the Date of Agreement; (iv) Developer is not in Default under this DDA, and (v) City has opted not to pursue preparation of its own new Specific Plan for Mare Island or, if after opting to pursue such plan, the City Council has failed to approve such plan by the sixth (6th) anniversary of the Date of Agreement.

Nothing herein shall be deemed to limit City’s discretion with respect to review and approval of discretionary land use entitlements or permits under Applicable Law or prohibit Developer from pursuing, at its expense, minor amendments to the Existing Specific Plan as needed to accommodate the Interim Permitted Specific Plan Development. 316. Island Energy Facility Relocations. Developer, at its expense, shall be responsible for relocating and/or reconstructing Island Energy electric and gas utility facilities on Mare Island and for obtaining required approvals from Island Energy in connection with Developer’s performance of Developer’s Work and any further development proposed by Developer on Mare Island, all as contemplated by the 2005 Operations Agreements between City and Island Energy regarding distribution of electricity and gas on Mare Island, copies of which OAK #4843-5079-9573 v18
39 have been provided to Developer. Developer’s obligations under this Section 316 shall survive the Closings.
317. Construction Staging Area License. Developer hereby agrees, subject to the terms and conditions of this Section, to grant City, at no cost to City, a Construction Staging Area License in the form attached hereto as Exhibit Q authorizing City to access and use from time to time a portion of the Property for the sole and limited purpose of using such area as a construction lay down area for storage of equipment and materials for major repair and maintenance work that City will perform or cause to be performed from time to time on the Mare Island Causeway Bridge all in accordance with the terms of the Construction Staging Area License.
318. Water and Sewer and Storm System Reimbursement Agreements. As more specifically set forth in the Water System Reimbursement Agreement and Sewer and Storm System Reimbursement Agreement, Developer on behalf of itself and its successors and assigns shall reimburse City and VFWD for the ongoing costs to be incurred by City and VFWD, respectively, in connection with the maintenance and repair of the existing water and sewer systems (including storm drains) to be retained by City and VFWD, respectively, until such time as Developer or its successors have constructed and installed new Backbone Infrastructure, including new potable and fire suppression water lines, sewer and storm drain lines and ancillary water, sewer and storm drainage facilities and improvements, and such new infrastructure improvements, together with customary easements for same, have been accepted by City or VFWD, as applicable, all as set forth herein and in the Water System Reimbursement Agreement and Sewer and Storm System Reimbursement Agreement. Developer’s obligations set forth in this Section shall survive the Closings and shall be set forth in the Water System Reimbursement Agreement and Sewer and Storm System Reimbursement Agreement to be recorded against the City-Owned Property and Navy-Owned Property, or applicable portion thereof, at the time of each Conveyance.
400. CITY OBLIGATIONS AND RESERVATIONS OF DISCRETION
401. Future Application Processing. Upon submission by Developer of all appropriate applications, processing fees and reimbursement payments for any Future Applications, City shall, to the full extent allowed by Applicable Laws, promptly and diligently, subject to City ordinances, policies and procedures regarding hiring and contracting, commence and complete all steps necessary to act on Developer’s currently pending Future Applications including: (a) upon the written request of the Developer, providing at Developer’s sole cost and expense and subject to City’s ability to obtain such services, additional staff and/or staff consultants for expedited planning and processing of each pending Future Application (Developer shall pay such costs at cost plus 20% for administrative costs incurred); (b) if legally required, providing notice and holding public hearings; and (c) acting on any such pending Future Application.
402. Island Energy Easements. City shall make available to Developer, on an ongoing basis, all documents in City’s possession or control related to the current or proposed location of easements granted by the Navy to utility providers, including Island Energy and OAK #4843-5079-9573 v18
40 VFWD. City, at Developer’s expense, shall assist Developer with obtaining any rights from Island Energy or other applicable utility provider for the demolition or relocation of existing utilities and the construction of new utilities.
403. City Reserved Discretion. Developer acknowledges that City retains full and complete discretion as to whether to approve any proposed Future Applications, including applications for the proposed New Specific Plan and Beautification Plan as well as any development project proposed for the Property, including any Interim Permitted Specific Plan Development. Accordingly, any action taken by the City (e.g., approval, conditional approval, disapproval) in the exercise of its discretion relating to (i) any analysis of any proposed plan or development project required by NEPA and/or CEQA, or (ii) any Future Application for a permit or approval required to develop the Property shall not constitute a default or a breach of the terms of this DDA by City. Developer further acknowledges that review and approval of any proposed Future Applications, including applications for the proposed New Specific Plan, may also trigger an obligation to process applications for conforming modifications to the Reuse Plan and to comply with NEPA and/or CEQA and coordinate with the Navy and/or other federal agencies in connection therewith.

By execution of this DDA, City is not committing itself to, or agreeing to, undertake approval of any proposed Future Applications, including applications for the proposed New Specific Plan or Beautification Plan or any other Future Applications for any development project, including any Interim Permitted Specific Plan Development, or any other act or activity requiring the subsequent independent exercise of discretion by the City. This DDA shall not limit in any manner the discretion of City in its consideration and action on any Future Applications for permits or approvals for development of the Property. The parties acknowledge that compliance with CEQA (and, potentially, NEPA) will be required in connection with consideration of such permits and approvals, and that City shall retain the discretion before action on any such Future Applications to: (a) determine whether the proposed development plan or project has been adequately analyzed by the EIS/EIR and SEIR or requires additional evaluation under CEQA; (b) adopt or certify a supplemental environmental analysis of any proposed development plan or project prepared in accordance with CEQA; (c) identify and impose mitigation measures to mitigate significant environmental impacts of the proposed development plan or project; (d) select other feasible alternatives to avoid significant environmental impacts; (e) adopt a statement of overriding considerations in accordance with Public Resources Code Section 21081(b) relative to any significant environmental impacts of the proposed development plan or project which cannot otherwise be avoided; or (f) determine not to proceed with the proposed plan or project. Any action taken by the City in the exercise of its discretion relating to any analysis of any proposed development plan or project required by CEQA on any Future Application(s) for any plan, permit or approval required to develop the Property shall not constitute a default or a breach of the terms of this Agreement by City.

City shall prepare or cause to be prepared, and Developer shall pay the actual cost of, any and all environmental documents and studies required for any proposed development plan or project under CEQA. Developer shall reasonably cooperate with the City in preparing environmental documents by supplying necessary technical data and other related information OAK #4843-5079-9573 v18
41 and/or plans concerning the proposed development plan or project. Developer shall be responsible for payment of any actual costs, fees or charges incurred by City or Developer in connection with CEQA and NEPA compliance for any proposed development plan or project. 404. Trust Termination Patents. Following Closing, City, at Developer’s expense, shall use good faith diligent efforts to obtain patents terminating the public trust as to those portions of the Property comprising “trust termination parcels” as described in the State Lands Settlement Agreement.
500. RESERVED.
600. PAYMENT OF FEES AND CITY COSTS.
601. Developer Reimbursement. Subject to the terms and conditions set forth in this DDA, the Developer agrees to pay to or reimburse City for City’s actual costs incurred in connection with the administration and implementation of this Agreement, including City’s review and processing of all Future Applications, including for the proposed New Specific Plan and Beautification Plan and all other planning, entitlement and development project applications; formation of the New CFD(s) or, in the alternative, annexation of the Navy-Owned Property into the Existing CFDs and annexation of the City-Owned Property into CFD 2005-1A and CFD 2005-1B, as provided in Section 309 above; and such other reviews required in connection with development of the Property (collectively, “City Costs”). City Costs that Developer is obligated to pay or reimburse to City shall include, without limitation, the following:
601.1 City Fees. All Future Application and permit processing fees, including without limitation, fees for plan checking, inspection, monitoring, land use approvals, design review, grading, demolition and building permits, and all other permits and entitlements.

Developer will pay all applicable fees in effect at the time of payment for each such permit or entitlement, as set forth in City’s fee schedule as annually updated (all of the foregoing, “City Fees”).
601.2 City Staff Costs. City’s actual staff costs and actual in-house legal counsel costs, both only to the extent relating directly to the transactions contemplated by this DDA.
601.3 Third Party Costs. City’s reasonable, documented, out-of-pocket third party costs for legal and other professional and consulting services (plus 20% for administrative costs incurred in the case of professional and consulting services) necessary to review Future Applications and implement and administer this DDA and consummate the transactions contemplated by this DDA, including fees and expenses of outside counsel and other consultants selected by City to assist in terminating the public trust as to those portions of the Property comprised of “trust termination parcels” as described in the State Lands Settlement Agreement; forming the New CFD(s) or, in the alternative, annexing the Navy-Owned Property into the Existing CFDs and annexing the City-Owned Property into CFD 2005-1A and CFD 2005-1B; and, if applicable, forming such new proposed capital CFD or other Backbone Infrastructure financing mechanism as the parties may mutually agree.

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42 Notwithstanding the foregoing, “City Costs” shall expressly exclude any costs, fees, and expenses: (i) arising from third party property damage and/or personal injury claims to the extent caused by the active negligence or willful misconduct or City or any other City Parties, (ii) arising from the breach of this Agreement, any Transaction Document, or any other ancillary agreements or contracts between City, on the one hand, and Developer, and/or any Developer Parties, on the other hand (collectively, “Ancillary Agreements”), (iii) arising from the breach of any other agreement or contract by City or any other City Parties, (iv) that are reimbursed by insurance proceeds or third parties, (v) that are expressly stated to be the sole obligation or responsibility of the City or any other City Party pursuant to this Agreement, any Transaction Document, or any Ancillary Agreement, and (vi) that are not substantiated by commercially reasonable cost verification documents; provided the foregoing exceptions shall in no way limit the Developer’s express indemnity obligations under this Agreement. 602. Project Account. Within five (5) business days following the Date of Agreement, Developer shall deposit with City the sum of Two Hundred Thousand Dollars ($200,000) referred to herein as the “Project Account Deposit”. City will hold the Project Account Deposit and replenishments thereof in an interest bearing account reasonably approved by Developer (“Project Account”). All interest earned on the funds in the Project Account shall be added to the Project Account Deposit. City shall be entitled to draw funds from the Project Account solely to pay City Costs consistent with properly submitted Invoices (defined below).

City will promptly provide written notice to Developer in the event the Project Account Deposit falls below Fifty Thousand Dollars ($50,000) in which case Developer shall replenish the Project Account to Two Hundred Thousand Dollars ($200,000) within fifteen (15) business days of receipt of such notice. If Developer fails to replenish the Project Account within such time, City shall have no obligation to continue processing any pending or new Future Applications, incurring any further City Costs or working in connection with the New Specific Plan, Beautification Plan, or any regulatory approval until such time as the additional funds required to supplement the Project Account Deposit have been delivered. Developer acknowledges and agrees that City shall have no obligation to repay or reimburse to Developer any funds that Developer has paid to City for City Costs incurred if for any reason City disapproves one or more of Developer’s planning, entitlement and/or development-related applications. City shall provide the Developer with a detailed accounting of all funds in the Project Account quarterly along with its Invoices submitted pursuant to Section 604 below, and promptly after receipt of written request from Developer, an accounting to be certified by the City Finance Director as being true, correct and complete. The funds in the Project Account shall not be comingled with any other funds and shall not be used for any purpose other than to pay for properly invoiced and approved City Costs in accordance with the terms and conditions of this DDA. If upon conclusion of the Project there are any funds remaining in the Project Account City shall promptly return such funds to Developer.
603. CEQA Related Costs. Developer shall pay all costs associated with CEQA compliance, including costs and expenses of preparing appropriate CEQA documents and studies in connection with Developer’s Work and any Future Applications, pursuant to separate reimbursement agreements to be entered into by the parties prior to commencement of preparation of such documents and studies. The reimbursement agreements shall require a OAK #4843-5079-9573 v18
43 Developer deposit in the full amount of the costs of such CEQA work. Disbursements from the CEQA deposit account shall be made by City solely to pay CEQA costs in accordance with such reimbursement agreement(s). Any earnings on the CEQA deposit(s) shall be deemed to be part of such deposit(s).
604. Invoices. City shall provide Developer with quarterly invoices for City Costs (“Invoices”), and will exercise commercially reasonable efforts to deliver the same within fortyfive (45) days following the end of each quarter. Such Invoices shall include such information as reasonably requested by Developer to evidence the actual City Costs incurred during the prior quarter and shall include a signature by a City official certifying that such amounts are consistent with this Agreement; provided in no event shall City be required to submit information that City is precluded from disclosing or information protected by City’s attorney-client privilege and not otherwise subject to disclosure by City under Applicable Law. Developer agrees to promptly inform City of any disputed Invoices or City Costs included thereon, and City agrees to reasonably cooperate with Developer in resolving any such disputes. 605. Audit; Disputes. Developer shall have the right, at its sole cost and expense (except as set forth below), to audit the books and records of the City with respect to the Project Account, all Invoices, and all other matters relating to City Costs. City will reasonably cooperate with any such audit. If any audit discloses a violation of the terms of this Agreement by City or otherwise discloses any overpayment of City Costs for any quarter of 5% or more than the amount actually owed for such quarter, then City shall be responsible for the actual and reasonable third party costs incurred by Developer in connection with such audit and shall pay such amounts to Developer within thirty (30) days after receipt of detailed written demand therefor, and in addition to Developer’s other rights and remedies under this Agreement and Applicable Laws, City shall promptly refund any overpayments to Developer, or, at Developer’s election, shall deposit such overpayments into the Project Account. Any disputes between the parties with respect to City Costs, the Project Account or Project Account Deposit, any Invoice, or any other matters set forth in Sections 601 through 605 shall be resolved via binding arbitration in accordance with Exhibit P.
700. INSURANCE, INDEMNITY, LEGAL CHALLENGES
701. Insurance Requirements. Until completion of development of the Property, Developer shall procure and maintain, or cause its contractor(s) to procure and maintain, as applicable, the insurance policies set forth in Exhibit L. None of such insurance shall not be construed to relieve Developer or its contractor(s) of any liability in excess of such coverages. 702. Developer’s Indemnity. Developer shall indemnify, defend (with counsel reasonably acceptable to City), protect, and hold City and City Parties harmless from and against any and all Claims, including Claims for any bodily injury, death, or property damage, to the extent directly or indirectly arising or resulting from (i) investigation of the Property as provided for in Section 202.1 above; (ii) the performance of Developer’s Work; (iii) discovery of Hazardous Materials on or about the Property, including requirements for additional remediation work; (iv) the construction and installation of Backbone Infrastructure or development of other horizontal or vertical improvements by or on behalf of Developer; and/or (v) any acts, omissions, OAK #4843-5079-9573 v18
44 negligence or willful misconduct of Developer under this DDA, whether such acts, omissions, negligence or willful misconduct are by Developer or any Developer Parties. Developer’s indemnity obligations under this Section 702 shall not apply to the extent such Claims arise from the active negligence or willful misconduct of City or any City Parties. Developer’s obligations under this Section shall survive the Closings as well as issuance of the Certificate of Completion and any termination of this DDA.
703. Cooperation and Indemnity in the Event of Legal Challenge. In the event any third party or other governmental entity or official institutes a court action or proceeding challenging the validity of this DDA or any provision hereof or City’s approval of this DDA, including any of the Transaction Documents or any CEQA documents or findings in connection therewith, or any land use approvals or entitlements for development of all or any portion of the Property or South Mare Island Property, City and Developer, at Developer’s sole cost and expense, shall cooperate in the defense of such action, and City shall, upon request of Developer, appear in the action and defend its decision at Developer’s sole cost and expense, except that City shall not be required to be an advocate for Developer. Developer shall indemnify, defend (with counsel reasonably acceptable to City), hold harmless and reimburse City, within fifteen (15) business days following Developer’s receipt of City’s detailed written demand therefor (which shall include copies of all applicable invoices and other non-privileged information), which may be made from time to time during the course of such litigation or other legal proceeding, all actual and reasonable costs incurred by City in connection with the legal challenge, including City’s reasonable attorneys' fees and costs, expert witness and consultant fees, and administrative, legal, and court costs. Developer’s obligations under this Section 703 shall survive the Closings and shall include the obligation to indemnify, defend, and hold harmless City and its officials and employees from and against any Claims assessed or awarded against City by way of judgment, settlement, or stipulation, including any attorneys’ fees or costs awarded against City under any applicable statute, including Code of Civil Procedure Section 1021.5, by way of judgment, settlement, or stipulation. Nothing herein shall authorize Developer to settle any legal challenge on terms that would constitute an amendment or modification of this DDA, or any land use approvals or entitlements for development, unless such amendment or modification is approved by City in accordance with applicable legal requirements, and City reserves its full discretion with respect thereto.
800. DEFAULTS AND REMEDIES
801. Default. Failure by either party to perform any action or covenant required by this Agreement within thirty (30) days following receipt of written notice from the other party specifying the failure shall constitute a “Default” under this Agreement; provided, however, that if the failure to perform cannot be reasonably cured within such thirty (30) day period, a party shall be allowed additional time as is reasonably necessary to cure the failure so long as such party commences to cure the failure within the thirty (30) day period and thereafter diligently prosecutes the cure to completion. Upon occurrence of such Default and without any right to further notice or additional cure period, the non-defaulting party shall have all remedies available to it under this Agreement, including the right to terminate this Agreement as set forth in Section 805 below. Neither party shall have the right to recover any punitive, consequential, or special OAK #4843-5079-9573 v18
45 damages. Notwithstanding any other provision hereof to the contrary, the notice and opportunity to cure provisions set forth in this Section 801 shall not apply to a Closing Failure as set forth in Section 803 below. In addition to the foregoing, any default by either party under one or more of the Transaction Documents which is not cured following notice and expiration of any applicable cure periods thereunder shall also constitute a Default under this DDA, and upon occurrence of such Default and without any right to further notice or additional cure period the non-defaulting party shall have all remedies available to it under this DDA. 802. Legal Actions; Limitation on Damages. Upon the occurrence of a Default by Developer which is not related to a Closing Failure as provided in Section 803 below, City shall have the right, in addition to any other rights or remedies, to institute any action at law or in equity to cure, correct, prevent or remedy such Default, including the recovery of actual damages; provided, however, that in no event shall City’s pre-Closing remedies include specific performance of Developer’s obligation to close escrow on the Property. Developer’s remedies in the event of a Default by City shall be limited to obtaining specific performance or injunctive relief, or terminating this Agreement and receiving a refund of the Deposit. Such legal actions must be instituted in the Superior Court of the County of Solano, State of California, or in the Federal District Court for the Northern District of the State of California. Notwithstanding anything herein to the contrary, neither party shall have the right to recover any consequential, special or punitive damages in the event of a Default by the other party. 803. Liquidated Damages in the Event of a Closing Failure. IF, FOR ANY

REASON OTHER THAN A DEFAULT BY CITY OR A FAILURE OF ANY

DEVELOPER CONDITIONS PRECEDENT, DEVELOPER FAILS TO CLOSE

ESCROW FOR THE INITIAL CONVEYANCE BY THE OUTSIDE DATE FOR

INITIAL CONVEYANCE (AS SUCH DATE MAY BE EXTENDED DUE TO FORCE MAJEURE CONDITIONS) (“CLOSING FAILURE”), THE PARTIES ACKNOWLEDGE

AND AGREE THAT CITY WILL SUFFER DAMAGES, INCLUDING COSTS OF

COOPERATING IN SATISFYING CONDITIONS TO CLOSING, COSTS OF SEEKING

ANOTHER DEVELOPER FOR THE PROPERTY, OPPORTUNITY COSTS IN

KEEPING THE PROPERTY OUT OF THE MARKETPLACE, AND OTHER COSTS

INCURRED IN CONNECTION HEREWITH, AND THAT IT IS IMPRACTICABLE AND INFEASIBLE TO FIX THE ACTUAL AMOUNT OF SUCH DAMAGES.

THEREFORE, CONSIDERING ALL THE CIRCUMSTANCES EXISTING ON THE

DATE OF AGREEMENT, IN THE EVENT OF A CLOSING FAILURE, CITY SHALL

RETAIN THE DEPOSIT AND SUCH AMOUNT SHALL SERVE AS LIQUIDATED DAMAGES TO CITY FOR SUCH CLOSING FAILURE. RETENTION OF THE DEPOSIT SHALL BE THE CITY’S SOLE AND EXCLUSIVE REMEDY AGAINST

DEVELOPER IN THE EVENT OF A CLOSING FAILURE, AND CITY WAIVES ANY

AND ALL RIGHT TO SEEK OTHER RIGHTS OR REMEDIES AGAINST
DEVELOPER, INCLUDING WITHOUT LIMITATION, SPECIFIC PERFORMANCE; PROVIDED, HOWEVER, ALL OF DEVELOPER’S OBLIGATIONS TO INDEMNIFY

CITY AS PROVIDED HEREIN THAT, BY THEIR TERMS, EXPRESSLY SURVIVE

THE TERMINATION OF THIS AGREEMENT, SHALL BE SEPARATE,
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46 ADDITIONAL, AND INDEPENDENT OBLIGATIONS OF DEVELOPER SURVIVING THE TERMINATION OF THIS AGREEMENT.
803.1 Statutory Acknowledgments Regarding Liquidated Damages Remedies. THE LIQUIDATED DAMAGES PROVIDED FOR IN THIS SECTION 803 ARE

NOT INTENDED AS A FORFEITURE OR PENALTY WITHIN THE MEANING OF SECTIONS 3275 OR 3369 OF THE CALIFORNIA CIVIL CODE, BUT ARE INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO CITY PURSUANT TO SECTIONS 1671, 1676 AND 1677 OF THE CALIFORNIA CIVIL CODE. BY PLACING THEIR INITIALS BELOW,

DEVELOPER AND CITY SPECIFICALLY CONFIRM THE ACCURACY OF THE

STATEMENTS MADE ABOVE, THE REASONABLENESS OF THE AMOUNT OF

LIQUIDATED DAMAGES AGREED UPON, AND THE FACT THAT EACH PARTY WAS

REPRESENTED BY COUNSEL WHO EXPLAINED, AT THE TIME THIS AGREEMENT WAS MADE, THE CONSEQUENCES OF THIS LIQUIDATED DAMAGES PROVISION.

INITIALS: _________ ______________

CITY DEVELOPER
804. Acceptance of Service of Process. In the event that any legal action is commenced by Developer against City, service of process on City shall be made by personal service upon the City Clerk of City or in such other manner as may be provided by law. In the event that any legal action is commenced by City against Developer, service of process on Developer shall be made by personal service upon Developer’s registered agent for service of process in California, or in such other manner as may be provided by law. 805. Termination. In addition to the automatic termination provided for under Sections 202.3 and 208.2 above, this Agreement may be terminated if there is an uncured Default, after notice from the party not in default and expiration of all cure periods. 806. Additional City Remedy Following Conveyance - Option to Repurchase, Reenter and Repossess.
806.1 City Option. Subject to the terms of this Section 806, City shall have the right at its option to repurchase, reenter and take possession of the Property (with all improvements thereon) (“City Option”), if after Closing of the Initial Conveyance and prior to issuance of a Certificate of Completion, Developer:
a. Transfers, or suffers any involuntary transfer of the Property or any part thereof in violation of this DDA; or
b. Is in Default under this DDA; or
c. Is in default under one or more of the Transaction Documents after notice and expiration of applicable cure periods.

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47 806.2 Protection of Permitted Mortgagees. The City Option shall be subordinate and subject to and be limited by and shall not defeat, render invalid or limit: (a) any mortgage, deed of trust or other security instrument permitted by this DDA; or (b) any rights or interests provided in this DDA for the protection of the holder of such mortgages, deeds of trust or other security instruments.
806.3 Exercise of City Option.
a. To exercise the City Option, City shall provide Developer written notice of City’s intent (“Notice of Intent”) to exercise its option to repurchase the Property or portion thereof previously conveyed to Developer following the occurrence of any of the events set forth in Section 806.1. Subject to the procedures, terms and conditions set forth in this Section 806.3, City shall pay to Developer in immediately available funds an amount equal to:
(a) the $3,000,000 Purchase Price paid by Developer (or a prorated portion of such amount, prorated on a per acre basis, if less than the entirety of the Property is included in City’s Notice of Intent); provided, however, if Developer is in Default for failure to accept conveyance of all or a portion of the Navy-Owned Property pursuant to the “must take” provisions of Section 201 above, then no portion of the Purchase Price shall be included in the calculation of City’s payment), plus (b) the verified, out-of-pocket, hard costs actually incurred by Developer and paid to unaffiliated third-parties for labor and materials solely for Demolition Work, Site Preparation Work and construction of permitted improvements, if any, on the Property, or applicable portion thereof, existing at the time City exercises the option to purchase (exclusive of amounts financed, if any, to the extent such financing obligations are assumed by City), not to exceed a maximum of $10,000,000.00 (“Project Hard Costs”); and less (c) the amount of unpaid liens on the Property or such portion thereof which City agrees to pay, and any unpaid current or past-due installments of taxes or assessments against the Property or such portion thereof which City agrees to pay. Project Hard Costs shall not include any Planning Work costs or other soft costs incurred in connection with the planning, entitlement or development of the Property. b. Developer shall, within thirty (30) days after receipt of City’s Notice of Intent, provide to City for review and approval, a summary of all of Developer’s Project Hard Costs as provided in Section 806.3a above. In the event the parties are unable to agree upon the Project Hard Costs, the matter shall be resolved by binding arbitration under the procedures attached hereto as Exhibit P. Within thirty (30) days after determination of the Project Hard Costs, City shall open an escrow for Developer’s conveyance back to City, or its designee, of the Property or portion thereof previously conveyed to Developer. The escrow for Developer’s conveyance of the Property or applicable portion thereof back to City shall close on a date specified by City which shall be not less than thirty (30) days, nor more than 24 months, following the determination of Project Hard Costs as provided above. At closing City (or its designee) shall pay to Developer through the escrow all sums owing pursuant to this Section 806, and Developer shall execute and deliver to City (or its designee) through the escrow a form title company quitclaim deed transferring to City (or its designee) all of Developer’s right, title and interest in and to said Property or portion thereof previously conveyed to Developer and any improvements thereon.

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48 c. City may transfer the City Option to any person or entity that City so designates.
d. Notwithstanding any other provision hereof to the contrary, the City Option shall expire upon City’s issuance of the Certificate of Completion. 807. Rights and Remedies Are Cumulative. The rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party, except as otherwise expressly provided herein.
808. No Waiver. Any failures or delays by either party in asserting any of its rights and remedies as to any Default shall not operate as a waiver of any Default or of any such rights or remedies, or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies.
900. DEVELOPER FINANCING; MORTGAGEE PROTECTION.
901. Generally. Prior to the issuance of a Certificate of Completion, Developer shall not place or allow to be placed on the Property any mortgage, trust deed, encumbrance or lien except as expressly authorized by this DDA. Developer shall remove or have removed any levy or attachment made on the Property (or any portion thereof), or shall assure the satisfaction thereof, within a reasonable time, but in any event not more than sixty (60) days after filing of such levy or attachment. Nothing herein contained shall be deemed to prohibit Developer from contesting the validity or amounts of any tax, assessment, encumbrance or lien, nor to limit the remedies available to Developer with respect thereto.
902. Right of City to Satisfy Other Liens After Closing. Prior to the issuance of a Certificate of Completion, and after Developer has had written notice and has failed after a reasonable time, but in any event not more than sixty (60) days after receipt of written notice, to satisfy or release any liens or stop notices on the Property pursuant to this Section 902, City shall have the right, but not the obligation, to satisfy any such liens or stop notices with written notice to Developer, but only to the extent that at such time there does not exist a bona-fide dispute with respect to such matters. Developer shall reimburse City for any and all actual and reasonable costs associated with removal or payment of such lien or stop notice within ten (10) business days following Developer’s receipt of City’s written demand therefor (which shall include copies of all cost verification documents).
903. Mortgage, Deed of Trust, Sale and Lease-Back Financing. 903.1 Mortgages and Deeds of Trust for Development. Mortgages and deeds of trust shall be permitted liens on the Property following each Conveyance, including without limitation instruments given to secure any financing relating to the Developer’s Work and any other development, construction, and/or improvement of the Property or any part thereof.

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49 903.2 Holder Not Obligated to Construct Improvements. The holder of any mortgage or deed of trust shall not be obligated by the provisions of this DDA to perform any of Developer’s Work or to guarantee such work. Nothing in this DDA shall be deemed to or be construed to permit or authorize any such holder to devote the Property to any uses or to construct any improvements thereon or therein other than those uses permitted by this Agreement and provided for and specified in the New Specific Plan or, if City Council opts not to approve the proposed New Specific Plan, the Existing Specific Plan. 903.3 Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure. With respect to any mortgage or deed of trust granted by Developer as provided herein, whenever City shall deliver any notice to Developer with respect to any potential Default by Developer hereunder, City shall at the same time deliver a copy of such notice to each holder of record of any mortgage or deed of trust on the Property. No notice of Default shall be effective as to the holder unless such notice is given. Each such holder shall (insofar as the rights of City are concerned) have the right, at its option, within ninety (90) days after the receipt of the copy of the notice, to cure or remedy or commence to cure or remedy any such Default. In the event possession of the Property (or portion thereof) is required to effectuate such cure or remedy, the holder shall be deemed to have timely cured or remedied if it commences the proceedings necessary to obtain possession thereof within ninety (90) days after receipt of the copy of the notice, diligently pursues such proceedings to completion, and, after obtaining possession, diligently completes such cure or remedy.
903.4 Right of City to Cure Mortgage or Deed of Trust Default. If, prior to Developer’s completion of Developer’s Work, a mortgage or deed of trust default or breach by Developer occurs, and the holder of any mortgage or deed of trust has not exercised its option to cure the default, then so long as there does not at such time exist any bona-fide dispute between Developer and its lender(s), the City, at its option, may cure the default following at least thirty (30) days’ prior written notice thereof to Developer. In the event City is allowed to, and properly opts to cure such Developer mortgage or deed of trust default in accordance with the requirements above, Developer shall be liable for, and City shall be entitled to reimbursement from Developer of, all actual and reasonable costs and expenses incurred by City associated with and attributable to the curing of the mortgage or deed of trust default or breach. City shall also be entitled to record a lien against the Property to the extent of such incurred costs and disbursements. Any such lien shall be subject and subordinate to all prior encumbrances and deeds of trust.
904. Estoppel Certificates. Developer or its lender(s) (if any) may, at any time, and from time to time, deliver written notice to City requesting City to certify in writing that: (a) this DDA is in full force and effect; (b) this DDA has not been amended or modified or, if so amended or modified, identifying the amendments or modifications; (c) neither Developer nor City is in breach or Default of the performance of its obligations, or if in breach or Default, to describe therein the nature and extent of any such breaches or Defaults; and (d) such other items as may be reasonably requested by Developer or its lender(s). To the extent not already paid for as part of City Costs Developer shall pay, within thirty (30) days following receipt of City’s invoice, the actual and reasonable costs borne by City in connection with its review of the OAK #4843-5079-9573 v18
50 proposed estoppel certificate, including the costs expended by the City Attorney’s office and Planning and Development Services Department in connection therewith. The Planning and Development Services Director shall be authorized to execute any estoppel certificate requested by Developer hereunder. The form of estoppel certificate shall be in a form reasonably acceptable to the City Attorney. The Planning and Development Services Director shall execute and return such certificate within twenty (20) days following Developer’s request therefor.

Developer and City acknowledge that an estoppel certificate hereunder may be relied upon by tenants, transferees, investors, partners, lenders, and mortgagees. The request shall clearly indicate that failure of City to respond within the twenty (20) day period will lead to a second and final request. Failure to respond to the second and final request within five (5) business days of receipt thereof shall be deemed approval of the estoppel certificate and shall entitle Developer, its lender(s), and such other parties designated by Developer to rely thereon. 1000. GENERAL PROVISIONS.
1001. Notices, Demands and Communications between the Parties. Any approval, disapproval, demand, document or other notice which either party may desire to give to the other party under this DDA must be in writing and shall be given by certified mail, return receipt requested and postage prepaid, personal delivery, or reputable overnight courier (but not by facsimile or email), to the party to whom the notice is directed at the address of the party as set forth below, or at any other address as that party may later designate by notice.

CITY: City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Manager
With copies to: City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Attorney
and: Gerald J. Ramiza, Esq.

Burke, Williams & Sorensen LLP
1901 Harrison Street, 9th Floor
Oakland, CA 94612-3501
Developer: The Nimitz Group, LLC
_______________________
_______________________
_______________________
Attn.: _________________
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51 With a copy to: The Nimitz Group, LLC
c/o Southern Land Company
Attn.: Legal Department
3990 Hillsboro Pike, Ste. 400
Nashville, TN 37215
Email: [email protected]
And with a copy to: Sheppard Mullin Richter & Hampton LLP Four Embarcadero Center, 17th Floor
San Francisco, CA 94111-4109
Attn: Keith Garner, Esq.

Any notice shall be deemed received on the date of delivery if delivered by personal service, on the date of delivery or refused delivery as shown by the return receipt if sent by certified mail, and on the date of delivery or refused delivery as shown by the records of the overnight courier if sent via nationally recognized overnight courier. Notices sent by a party’s attorney on behalf of such party shall be deemed delivered by such party. 1002. Enforced Delay; Extension of Times of Performance. Except as otherwise set forth in this DDA, and subject to the limitations set forth below, performance by either party hereunder shall not be deemed to be in Default, and all performance and other dates specified in this DDA shall be extended, where delays are due to: war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; acts of terror, epidemics; pandemics; quarantine restrictions; freight embargoes; unusually severe weather; government orders and any other acts or failures to act of any public or governmental agency (“Force Majeure Conditions”); provided any orders, acts or failures by City shall not be deemed Force Majeure Conditions with respect to the City. An extension of time for any such cause shall be for the period of the Force Majeure Condition, and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the party obtaining actual knowledge of the commencement of the cause; provided, however, the extension of the Outside Date for Initial Conveyance by reason of Force Majeure Conditions shall in no event extend beyond December 31, 2022.

Developer expressly agrees that, except as caused by Force Majeure Conditions, adverse changes in economic conditions, either of Developer or its Manager or Managing Member, as applicable, specifically or the economy generally, changes in market conditions or demand, and/or Developer’s inability to obtain financing or other lack of funding for one or more aspects of Developer’s Work shall not constitute grounds of enforced delay pursuant to this Section.

Except as caused by Force Majeure Conditions, Developer expressly assumes the risk of such adverse economic or market conditions and/or financial inability, whether or not foreseeable as of the Date of Agreement.
1003. Successors and Assigns. Subject to the restrictions on transfers set forth in Section 103 above, all of the terms, covenants and conditions of this DDA shall be binding upon Developer and City and their respective successors and assigns. Whenever the term “Developer” OAK #4843-5079-9573 v18
52 is used in this DDA, such term shall include any permitted successors and assigns as herein provided.
1004. Non-Liability - Developer. No employee, manager, member, owner, partner, officer, or other representative of Developer or any other Developer Party, shall be personally liable to City, or any successor in interest of City, in the event of any Default or breach by Developer of its obligations under this DDA or for any amount which may become due to City or its successors under the terms of this DDA. City hereby waives and releases any claim it may have against such persons with respect to any Default or breach by Developer or for any amount which may become due to City or its successors under the terms of this DDA. 1005. Relationship between City and Developer. It is hereby acknowledged that the relationship between City and Developer is not that of a partnership or joint venture and that City and Developer shall not be deemed or construed for any purpose to be the agent of the other.

Developer shall indemnify, protect, hold harmless and defend City from any Claims made against City arising from a claimed relationship of partnership or joint venture between City and Developer with respect to the development, operation, maintenance or management of the Property. Developer’s indemnity obligations under this Section shall survive the Closings and issuance of the Certificate of Completion.
1006. City Approvals and Actions. Whenever a reference is made herein to an action or approval to be undertaken by City, the City Manager or their designee is authorized to act on behalf of City, unless specifically provided otherwise or the context or Applicable Law requires otherwise.
1007. Counterparts. This DDA may be signed in multiple counterparts each of which shall be deemed to be an original.
1008. Integration. This DDA, including the Exhibits hereto, including the other Transaction Documents, contain the entire understanding between the parties relating to the transactions contemplated by this DDA. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, other than the Transaction Documents, are merged in this DDA and shall be of no further force or effect. Each party is entering into this DDA based solely upon the representations set forth herein and upon each party’s own independent investigation of any and all facts such party deems material. 1009. Brokerage Fees. City and Developer each represents to the other that it has not engaged the services of any finder or broker and that it is not liable for any real estate commissions, broker’s fees, or finder’s fees which may accrue by means of the Conveyance of the Property. Each party shall indemnify, defend, protect and hold the other party harmless from and against any and all Claims based upon any assertion that such commissions or fees are allegedly due from the party making such representations. The parties’ indemnity obligations under this Section shall survive the Closings and issuance of the Certificate of Completion. 1010. Interpretation. As used in this DDA, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others where and when the OAK #4843-5079-9573 v18
53 context so dictates. The words “include” and “including” shall be construed as if followed by the words “without limitation.” The parties acknowledge that each party and its respective counsel have reviewed and revised this DDA and that the rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this DDA or any document executed and delivered by either party in connection herewith. The captions in this DDA are for convenience of reference only and shall not be used to interpret this DDA. Reference to section numbers are to sections in this DDA, unless expressly stated otherwise. References to specific section numbers shall include all subsections which precede and follow the referenced section. As used herein, the term “days” means calendar days and the term “business days” means all calendar days other than Saturdays, Sundays, or holidays observed by City.
1011. Modifications. Any alteration, change or modification of or to this DDA, in order to become effective, shall be made in writing and in each instance approved and signed on behalf of each party.
1012. Severability. If any term, provision, condition or covenant of this DDA or its application to any party or circumstances shall be held, to any extent, invalid or unenforceable, the remainder of this DDA, or the application of the term, provision, condition or covenant to persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected, and shall be valid and enforceable to the fullest extent permitted by law.
1013. Computation of Time. The time in which any act is to be done under this DDA is computed by excluding the first day, and including the last day, unless the last day is a holiday or Saturday or Sunday, and then that day is also excluded. The term “holiday” means all holidays as specified in Sections 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time Zone time. 1014. Time of Essence. Time is expressly made of the essence with respect to the performance by City and Developer of each and every obligation and condition of this DDA. 1015. Cooperation. Each party agrees to reasonably cooperate with the other in connection with the Conveyances, and in that regard, shall execute any and all documents which may be reasonably necessary, helpful, or appropriate to carry out the purposes and intent of this DDA, to the extent the same are not inconsistent with the terms and conditions of this DDA. 1016. Conflicts of Interest. No member, official or employee of City shall have any personal interest, direct or indirect, in this DDA, nor shall any such member, official or employee participate in any decision relating to this DDA which affects his personal interests or the interests of any corporation, partnership or association in which he is directly or indirectly interested.
1017. Conflict with South Mare Island Property Documents. In the event of any conflict between the terms of one or more of the South Mare Island Property Documents and the terms of this DDA, the terms and provisions of this DDA shall control.

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54 1018. Time for Acceptance of Agreement by City. This DDA, when executed by Developer and delivered to City, must be authorized, executed and delivered by City on or before sixty (60) days after signing and delivery of this DDA by Developer or this DDA shall be void, except to the extent the parties shall consent in writing to a further extension of time for the authorization, execution and delivery of this DDA.
1019. Non-Liability of Officials and Employees of City. No employee, elected or appointed official or other representative of City shall be personally liable to Developer, or any successor in interest of Developer, in the event of any Default or breach by City of its obligations under this DDA or for any amount which may become due to Developer or its successors under the terms of this DDA. Developer hereby waives and releases any claim it may have against the employees, elected or appointed officials or other representatives of City with respect to any Default or breach by City or for any amount which may become due to Developer or its successors under the terms of this DDA.
1020. Plans and Data. If by the Outside Date for Initial Conveyance (as such date may be extended due to Force Majeure Conditions) Developer has not acquired from City fee title to the entirety of the City-Owned Property, then Developer shall provide City with full and complete copies of all investigation reports and studies applicable to the Property within Developer’ possession or direct control, including boring logs, sample or laboratory test results, or other technical data, studies and backup, including in digital formats that can be accessed across similar platforms used by Developer, produced by Developer or its contractors or subcontractors in connection with Developer’ due diligence and pre-development activities (collectively, “Work Product”) within sixty (60) days following the expiration or termination of the DDA and concurrently with City delivery to Developer of any remaining Project Account funds. The parties agree that Work Product shall not include attorney/client privileged communications and memoranda; Developer’s confidential proprietary financial information or development proformas; internal memoranda, reports or assessments regarding Property valuation or interpretation of any third party agreements or contracts or third party reports; or Developer’s architectural design concepts and plans, including the work of HOK or other architects. Once delivered, each of Developer and City shall own equal right, title and interest in and to such Work Product. All such Work Product shall be provided solely on an “AS IS” basis for use by City or any of its assigns or contractors at their own respective risk, and Developer shall not make, and hereby disclaims, any and all representations and warranties whatsoever with respect to all Work Product.
1021. Intentionally Omitted.
1022. Certificate of Completion. Following Developer’s satisfactory completion of Developer’s Work, without condition or delay and within the time set forth in the Schedule of Performance, City shall furnish Developer with “the Certificate of Completion”. The Certificate of Completion shall be conclusive determination of satisfactory completion of Developer’s Work and the Certificate of Completion shall so state. Any party then owning or thereafter purchasing, leasing or otherwise acquiring any interest in the Property shall not (because of such ownership, purchase, lease or acquisition) incur any obligation or liability under this DDA. However, the OAK #4843-5079-9573 v18
55 Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of Developer to any holder of any mortgage, or any insurer of a mortgage securing money loaned to finance development of the Property, or any part thereof, and is not a notice of completion as referred to in California Civil Code section 3093. If City refuses or fails to furnish the Certificate of Completion, City shall, within thirty (30) days after Developer’s written request therefor, provide Developer with a written statement of the reasons City refused or failed to furnish the Certificate of Completion. The statement shall also contain City’s opinion of the actions Developer must take to obtain the Certificate of Completion. City shall not unreasonably withhold such Certificate of Completion. City’s failure to provide such a written statement within such thirty (30) day period shall not constitute City’s deemed approval of Developer’s request for issuance of the Certificate of Completion; provided such failure shall entitle Developer to exercise all rights and remedies under this Agreement and Applicable Laws. 1023. Applicable Laws. The laws of the State of California, without regard to conflict of laws principles, shall govern the interpretation and enforcement of this DDA. 1024. Survival. The covenants and obligations identified in Section 301 shall survive the Closings and remain in effect until issuance of the Certificate of Completion. The covenants and obligations identified in Sections 210, 302, 304, 305, 306, 307, 308 (and Exhibit M), 309, 310, 312, 313, 314, 315 and 316 shall survive the Closings and issuance of the Certificate of Completion and remain in effect as provided in those sections. The defense, indemnification, protection and hold harmless obligations of Developer under Sections 202.1, 307, 702, 703, 1005 and 1009 shall survive the Closings as well as termination of this DDA and issuance of the Certificate of Completion.
1025. Right of First Offer. If, at any time prior to City’s issuance of the Certificate of Completion, the Developer intends to sell the fee interest in more than 20% of the Property to an unaffiliated third-party, then, in addition to City’s approval rights set forth in Sections 103.2d and 103.3 above, Developer hereby agrees to give City prior written notice thereof (the “Offer Notice”) and the option to purchase the Subject Property (defined below) subject to and in accordance with the terms and conditions of this Section 1025. The Offer Notice shall set forth (i) the subject portion of the Property that Developer intends to sell (the “Subject Property”), (ii) Developer’s proposed purchase price for the Subject Property, and (iii) all of the other material terms and conditions upon which Developer, in its sole discretion, is willing to sell the Subject Property, including without limitation any proposed restrictions on use and similar covenants that would bind the Subject Property after transfer. City shall have ninety (90) days after receipt of an Offer Notice to deliver to Developer written notice whereby City unconditionally and irrevocably agrees to purchase the Subject Property from Developer for the price and subject to the terms and conditions set forth in the Offer Notice (a “City ROFO Acceptance”). Any response from the City delivered after the time period set forth above shall be deemed rejected and of no force or effect, time being of the essence. Additionally, any response from the City that contains any counterproposals or any other terms and conditions which differ in any material way from the price and other terms and conditions set forth in the Offer Notice, shall be deemed a rejection by the City and shall be of no force or effect. If City properly delivers a City ROFO Acceptance within the time set forth above, and in strict OAK #4843-5079-9573 v18
56 accordance with the requirements set forth herein, then the parties shall promptly enter into a purchase and sale agreement or such other form of agreement as may be specified in the Offer Notice (the “ROFO Transfer Agreement”), on all of the terms and conditions set forth in the Offer Notice (including purchase price), and Developer shall sell and transfer the Subject Property to City in accordance with the terms and conditions of the ROFO Transfer Agreement; provided closing of such transfer shall occur within one hundred fifty (150) days after delivery of a City ROFO Acceptance and upon closing the Developer shall have no further obligations under this Agreement or any other Transaction Documents to the extent relating to the Subject Property, other than those obligations which survive termination of this Agreement. If City does not timely provide a City ROFO Acceptance, Developer may thereafter sell the Subject Property to any prospective third party purchaser on the terms set forth in the Developer’s Offer Notice, or any other economic terms which are less favorable to the prospective purchaser (such as a higher sale price) than the terms set forth in the Offer Notice. If Developer does not enter into a purchase and sale agreement with a third party for the Subject Property within twelve (12) months following delivery of the Offer Notice, City's right of first offer under this section shall be deemed revived and Developer may not sell the Subject Property without first offering it to City in accordance with this section. Notwithstanding the foregoing, and without limiting the terms and conditions set forth above, this Section 1025 and City’s rights set forth above shall in all events expressly exclude: (a) a Permitted Transfer, (b) any Transfer that does not require City Council approval under Section 103.2.d, and (c) any Transfer of membership interests in the Developer. Additionally, the rights set forth above are personal to the City and may not be assigned to or exercised by any other person or entity, and any purported transfer by the City shall render the rights above null and void.
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OAK #4843-5079-9573 v18
57 IN WITNESS WHEREOF, City and Developer have executed this Disposition and Development Agreement on the respective dates set forth below.

Dated: _______________________, 2022
CITY:

City of Vallejo, a California municipal
corporation
By:__________________________________
Mike Malone, Interim City Manager
ATTEST:
_________________________________
Dawn G. Abrahamson, City Clerk
APPROVED AS TO FORM:
_________________________________
Veronica Nebb, City Attorney
APPROVED AS TO CONTENT:
__________________________________
Paul Kelley, Special Advisor to the City
Manager, Economic Development Manager

APPROVED AS TO INSURANCE

REQUIREMENTS
______________________________
Armond Sarkis, Risk Manager
Dated: _______________________, 2022
DEVELOPER:

THE NIMITZ GROUP, LLC, a California
limited liability company
By: ______________________________
Print Name: ________________________
Its: _________________________
OAK #4843-5079-9573 v18
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Exhibit A

DEPICTION OF PROPERTY
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Exhibit B-1

DESCRIPTION OF CITY-OWNED PROPERTY
Real property in the City of Vallejo, County of Solano, State of California, described as follows:

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Exhibit B-2

DESCRIPTION OF NAVY-OWNED PROPERTY
Real property in the City of Vallejo, County of Solano, State of California, described as follows:

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Exhibit C

SCOPE OF WORK
I. PLANNING WORK
A. Beautification Plan and Beautification Work. Within the time set forth in the Schedule of Performance, Developer will submit to City for review, input and comment, refine based on City’s comments, and submit (and, if necessary, revise and resubmit one or more times) to City for consideration and potential approval a proposed Mare Island Beautification Plan for installation of interim landscaping; hardscaping; and fencing, lighting and security; which may include elements such as trees and flowers, public seating, and public art; with particular emphasis on the Mare Island Causeway Bridge and Highway 37 entry points to Mare Island and North Mare Island and also portions of South Mare Island as set forth below. The quality and scope of Beautification Work to be performed at the Causeway Bridge and Highway 37 entry points to Mare Island and at the Property will be generally commensurate with the illustrative interim landscaping examples submitted by Developer to City in the “Island Beautification – Potential Areas of Island Beautification” packet prepared by HOK Architects submitted to City on or about February 1, 2022. In the event City approves the proposed Beautification Plan then Developer will commence and complete the Beautification Work described in the City-approved Beautification Plan in two phases as set forth in the Schedule of Performance, with the first phase consisting of the Causeway Bridge and Highway 37 entry point work and the second phase consisting of work on the remaining portions of Mare Island, including the Property. The Parties acknowledge and agree that given the scale of the South Mare Island Property the interim Beautification Work shall address major public gathering points and connectivity corridors in and around South Mare Island but not all of the land comprising the South Mare Island Property.

For avoidance of doubt, the Parties further acknowledge and agree that since the landscaping and hardscaping work to be constructed and installed by Developer in connection with the Connolly Corridor Development Work will be permanent in nature, the Beautification Plan does not need to address the Connolly Corridor area.

B. New Specific Plan Work (Entirety of Mare Island). Within the time set forth in the Schedule of Performance, Developer will submit to City for review and consideration of approval a proposed New Specific Plan for Mare Island, which New Specific Plan shall include a plan for phased installation and construction of Backbone Infrastructure to serve all new development and redevelopment contemplated by the New Specific Plan. The New Specific Plan will cover the entirety of Mare Island, including those portions owned or controlled by Developer or its affiliates, including the Property and the South Mare Island properties which Developer or its affiliates have acquired or are under contract to acquire from Lennar Mare Island, LLC, which plan shall include all requisite statutory requirements per Government Code Section 65421 and address, among other items, the following: a range of permitted land uses which potentially include commercial, retail, residential, office, hotel, industrial, community/civic and recreational uses, and the timing for construction and installation of Backbone Infrastructure. The infrastructure sections of the New Specific Plan will specify that substantially all existing utility and related infrastructure will need to be decommissioned and replaced and not reused or repurposed to serve new development on Mare Island. Developer’s proposed New Specific Plan shall also address all requirements associated with the interfacing OAK #4843-5079-9573 v18
Exhibit C Page 2

and interconnection of the Property and the Backbone Infrastructure with other development on Mare Island. Developer’s obligations with respect to the design and construction of the Backbone Infrastructure shall be set forth in one or more public/subdivision improvement agreements to be entered into by the parties at the time the Property is further parcelized or subdivided or at the time one or more components of Backbone Infrastructure are required to be constructed.

II. DEMOLITION WORK
A. Demolition Work (North Mare Island). Within the time set forth in the Schedule of Performance, Developer shall commence and complete all work of demolishing the NonUtilized Buildings, including containing, removing and disposing of all debris, including lead based paint, PCB and asbestos containing materials in accordance with Applicable Laws, including Environmental laws all in accordance with the Agreement.

III. CONNELLY CORRIDOR DEVELOPMENT WORK
A. Connolly Corridor Development Work (South Mare Island). Within the time set forth in the Schedule of Performance, Developer shall commence and complete all of the Connolly Corridor Work, including those portions of Backbone Infrastructure reasonably necessary to support and service such new development as determined by City in its reasonable discretion.

IV. SOIL TESTING AND SITE PREPARATION WORK
A. Soil Testing (South Mare Island). Within the time set forth in the Schedule of Performance, Developer will cause a consultant selected by Developer to sample and test soil previously stockpiled by Lennar Mare Island at six locations (i.e. two within Area 14, two within Area 8, one within Area 18 and one within Area 21) as shown on the draft stockpile site plan prepared by ENGEO dated September 2007, so that a determination can be made as to whether such soil is suitable for importation as Clean Fill suitable for development of residential or residential mixed-use development.

B. Site Preparation Work (North Mare Island). In the event City approves a New Specific Plan then, as soon as practicable following City approval of the New Specific Plan, Developer will use commercially reasonable and diligent efforts to commence and complete importation of clean fill suitable for development of the various uses specified in such plan in quantities sufficient to raise the elevation of the Property to a level necessary to support Developer’s intended development and in accordance with all applicable governmental approvals, which is currently estimated to be approximately two million cubic yards. Beginning on the date set forth in the Schedule of Performance, Developer shall report to City on an annual basis regarding Developer’s progress in obtaining such Clean Fill and, if substantial progress in Clean Fill importation has not been made, an explanation as to why the Clean Fill was not obtained.

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Exhibit C Page 3

V. GENERAL REQUIREMENTS
A. Applicable Codes and Approvals. All Developer Work and all other construction and development work shall be performed in accordance with all conditions of approval imposed by the City Council, the Planning Commission and any other governmental body exercising jurisdiction over development of the Property. In addition, construction and development of all improvements, including Backbone Infrastructure, shall be in accordance with the Uniform Building Code (in effect in City from time to time with modifications thereto made by City) and the City Municipal Code and all other Applicable Laws.

B. Mitigation Measures. In connection with the development of the Property and construction and installation of Backbone Infrastructure and performance of the Developer’s Work, Developer shall observe and comply with all of the mitigation measures imposed by City under CEQA and, if applicable, federal agencies under NEPA, and all conditions of approval imposed in connection with the applicable planning, land use and entitlement and development approvals.

OAK #4843-5079-9573 v18 Exhibit D Page 1
Exhibit D

SCHEDULE OF PERFORMANCE
Ref. Action Date

1. §1018 City’s Execution and Delivery of DDA
City shall consider approval of this DDA and, if approved, shall deliver one executed original to Developer.

Within 60 days after
Developer’s execution
and delivery of the
DDA.

2. §202 Feasibility Period
Developer shall have the right to inspect the Property, review the Documents and approve the condition of the
Property.

Commencing on the
Date of Agreement and
expiring 90 days
thereafter.

3. §208.1 Delivery of Title Report
Developer shall cause Title Company to deliver to
Developer and City the Title Report, together with copies of the exceptions.

Within 20 business
days after the Date of
Agreement.

4. §208.2 Delivery of Title Notice
Developer shall deliver to City and Escrow Agent written notice of Developer’s approval or disapproval of the legal description and every item or exception disclosed by the Title Report and Survey, if any, and of any title insurance endorsements Developer requires.

No later than 60 days
after the later of
Developer’s receipt of
the Title Report, Survey
(if requested by
Developer) and copies
of all exception
documents.

5. §202 Escrow
Developer shall open the Escrow for the Conveyances with Fidelity National Title Insurance Company.

Within 5 business days
following the Date of
Agreement.

OAK #4843-5079-9573 v18 Exhibit D Page 2

Ref. Action Date

6. §204.2 Deposit
Developer shall deposit the Deposit into Escrow. Within 10 days after the Date of Agreement.

7. §202.3 Delivery of Notice of Approval
If Developer elects to proceed with the purchase of the Property and performance of Developer’s post-Closing
obligations Developer shall deliver written Notice of
Approval to City and Escrow Agent.

Prior to expiration of
Feasibility Period.

8. §207 Closing – City-Owned Property
Initial Conveyance of the City-Owned Property shall close. Within thirty (30) days after the satisfaction or
waiver of City’s and
Developer’s Conditions
Precedent, but no later
than the Outside Date
for Initial Conveyance

9. §207 Closing(s) – Navy-Owned Property
Conveyances of the Navy-Owned Property, or applicable
portions thereof, shall close.

Concurrently with
City’s acquisition of the
Navy-Owned Property,
or applicable portion
thereof, from Navy
through back-to-back
escrows.

10. §301 Soil Testing
Developer will cause a consultant selected by Developer to sample and test soil previously stockpiled by Lennar Mare Island as shown on the draft stockpile site plan prepared by ENGEO dated September 2007, so that a determination can be made as to whether such soil is suitable for residential or residential mixed-use development on Mare Island.

Within 12 months
following Closing of the
Initial Conveyance.

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Ref. Action Date

11. §301 Demolition Work
Developer shall complete the Demolition Work. Within 24 months following Closing of the
Initial Conveyance.

12. §301 Connelly Corridor Development Work
Developer shall complete the Connelly Core Development
Work.

Within 60 months
following Closing of the
Initial Conveyance.

13. §301 Beautification Plan
Developer shall cause to be prepared and submit to City for review and consideration, and potential approval, a
Beautification Plan for interim Beautification Work on
Mare Island with particular emphasis on the Mare Island Causeway Bridge and Highway 37 entry points to Mare
Island and the Property.

Within 8 months
following Closing of the
Initial Conveyance.

14. §301 Beautification Work- Entry Points
Developer shall complete the Mare Island Causeway Bridge and Highway 37 entry point components of the
Beautification Work.

Within 8 months
following City’s
approval of the
Beautification Plan.

15. §301 Beautification Work- Remainder
Developer shall complete the balance of the Beautification Work not included as part of the initial entry point work.

Within 24 months
following City’s
approval of the
Beautification Plan.

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Ref. Action Date

16. §301 New Specific Plan Submittal
Developer shall cause to be prepared and submit to City for review and consideration, and potential approval, a
comprehensive New Specific Plan for the entirety of Mare Island, including the Property and the South Mare Island Property.

Within 24 months
following Closing of the
Initial Conveyance.

17. §301 New Specific Plan Approval
Developer shall have obtained City approval of a New
Specific Plan and the New Specific Plan approvals shall be “Final”.

Within 42 months
following Closing of the
Initial Conveyance.

18. §309 CFD Formation or Annexation or Owner Association Developer shall have either submitted all petitions, consents and written documents required to either (i) effect formation of, and inclusion of the Property and South Mare Island Property within the New CFD(s) covering Mare Island to
replace the Existing CFDs, or (ii) annexation of the NavyOwned Property, or applicable portion thereof, into the Existing CFDs and City-Owned Property into CFD 2005-
1A and CFD 2005-1B, or (iii) formation of one or more
owners associations to take on responsibility for funding services currently provided by the Existing CFDs.

By the earlier of the date
on which a New
Specific Plan is
approved or the date of
conveyance of the last
Navy-Owned Property
parcel, or at such later
time(s) as the parties
may mutually agree.

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Ref. Action Date

19. §301 Site Preparation Work
Developer shall commence and complete the Site
Preparation Work.

As soon as practicable
following approval of
the New Specific Plan,
with the understanding
that the timing of
completion of the fill
importation work will
depend upon the pace of
development in the Bay
Area region, in
particular the extent to
which other
development projects
are required to find
locations for disposing
of excavated soil, and
the resulting market
demand for and pricing
for importation of Clean
Fill.

20. §308 and
Exh M
Local Economic Benefit Program Reporting
Developer shall submit a written report to City detailing Developer’s and its contractors and subcontractors
compliance with all Local Economic Development Program
requirements.

Not less than annually.

21. §313 Construction and Equipment Sales and Use Tax Reporting Developer shall submit a written report to City detailing Developer’s and its contractors and subcontractors
compliance with the use tax direct payment and
subcontractor job site permit-related requirements.

Not less than annually
during such times that
no construction is
ongoing and quarterly
during all times when
significant construction
related activities are
ongoing.

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Ref. Action Date

22. §301 and
Exh C
Site Preparation Work Reporting
Developer shall report to City regarding Developer’s
progress in obtaining and importing Clean Fill.

Not less than annually
after approval or
certification of an
appropriate
environmental document
under CEQA for such
work and the granting of
any required permits or
approvals for same.

23. §1020 Developer Provision of Work Product
If by the Outside Date for Initial Conveyance (as such date may be extended due to Force Majeure Conditions)
Developer has not acquired from City fee title to the entirety of the City-Owned Property, then Developer shall provide City with full and complete copies of all Work Product.

Within 60 days
following the expiration
or termination of the
DDA and concurrently
with City delivery to
Developer of any
remaining Project
Account funds.

24. §1002 Certificate of Completion
City shall execute and acknowledge a Certificate of
Completion and deliver such certificate to Developer for recordation in the Official Records of the County.

Within 30 days
following Developer’s
request and satisfactory
completion of all of
Developer’s Work.

OAK #4843-5079-9573 v18 Exhibit E
Exhibit E

SUBLEASE IN FURTHERANCE

OF CONVEYANCE
Between

CITY OF VALLEJO
And

THE NIMITZ GROUP, LLC
OAK #4843-5079-9573 v18 Exhibit E -iTABLE OF CONTENTS
Page

1. Capitalized Terms.. ..............................................................................................................2

2. Leased Premises. ..................................................................................................................2

3. Term .....................................................................................................................................2

4. Rent. .....................................................................................................................................2

5. 1999 LIFOC.. .......................................................................................................................2

6. Incorporation by Reference; Performance; Assumption......................................................3 A. Incorporation; Interpretation.. ..................................................................................3 B. Exceptions. ...............................................................................................................3 C. No Assumption by City. ..........................................................................................4

7. Insurance and Exculpation. ..................................................................................................4 A. Insurance. .................................................................................................................4 B. Exemption of City from Liability.. ..........................................................................5 C. Survival. ...................................................................................................................5

8. Intentionally Omitted. ..........................................................................................................5

9. Utility Services.....................................................................................................................5

10. Termination of Sub-LIFOC upon Conveyance....................................................................5

11. Notices.. ...............................................................................................................................6

12. Assignment and Subletting.. ................................................................................................7

13. Obtaining the Government's Consent. .................................................................................7

14. Notice by the Government to City.. .....................................................................................7

15. Hazardous Materials. ...........................................................................................................7

16. EBS and FOSL Notification.. ..............................................................................................9

17. Non-Interference with Government Regulator Operations; Unexploded Ordnance Removal. ..............................................................................................................................9 A. Non-Interference with Government Regulator Operations......................................9 B. Unexploded Ordnance Removal. .............................................................................9

18. Additional Requirements. ..................................................................................................10 A. Pre-Existing Conditions.. .......................................................................................10 B. Notice Regarding Holders......................................................................................10 C. Compliance with Laws. .........................................................................................11

TABLE OF CONTENTS
(Continued)
Page
OAK #4843-5079-9573 v18 Exhibit E -ii19. General Release. ................................................................................................................11

20. Future Subleases and Sublicenses.. ....................................................................................11

21. Labor Provisions of 1999 LIFOC. .....................................................................................11

22. Taxes. .................................................................................................................................11 A. Real Property Taxes. ..............................................................................................12 B. Personal Taxes. ......................................................................................................12 C. Payment of Taxes. ..................................................................................................12

23. Events of Default. ..............................................................................................................13

24. Remedies ............................................................................................................................13

25. Default Interest...................................................................................................................13

26. Arbitration of Disputes Involving the Government. ..........................................................14

27. Ambiguities. .......................................................................................................................14

28. Other Events of Termination. ............................................................................................14

29. Relocation Waiver. ............................................................................................................14

30. Use of Leased Premises; NEPA Review. ..........................................................................14

31. Successors in Interest. ........................................................................................................15

32. Severability. .......................................................................................................................15

33. Attorneys' Fees.. .................................................................................................................15

34. Amendments. .....................................................................................................................15

35. Execution. ..........................................................................................................................15

36. Counterparts. ......................................................................................................................15

37. Entire Agreement. ..............................................................................................................15

LIST OF ATTACHMENTS
Attachment No. 1 Leased Premises (Legal Description
Attachment No. 2 Leased Premises (Depiction)
Attachment No. 3 1999 LIFOC
OAK #4843-5079-9573 v18 Exhibit E -iiiINDEX OF DEFINED TERMS [TO BE INSERTED]
OAK #4843-5079-9573 v18 Exhibit E Page 1

SUBLEASE IN FURTHERANCE OF CONVEYANCE
THIS SUBLEASE IN FURTHERANCE OF CONVEYANCE ("Sub-LIFOC") is entered into as of _______________, 202__ ("Effective Date"), by and between the CITY OF VALLEJO, a California municipal corporation ("City" or “Sublessor”), and THE NIMITZ GROUP, LLC, a California limited liability company (“Sublessee”).

R E C I T A L S
This Sub-LIFOC is made with reference to the following facts and understandings:

A. The United States of America, acting by and through the Department of the Navy, as lessor ("Government"), and City, as lessee, entered into that certain Lease In Furtherance Of Conveyance dated September 30, 1999 ("1999 LIFOC") attached hereto as Attachment No. 3, by which the Government has leased to City a portion of the former Mare Island Naval Shipyard, including approximately 31.8 acres within Reuse Area 1-A, as described in Attachment No. 1 and depicted in Attachment No. 2 to this Sub-LIFOC (“Leased Premises”).

B. The Government has issued a Finding of Suitability for Transfer (“FOST”) for one of the two subparcels comprising the Leased Premises but transfer of that property to the City has been delayed due to new regulatory requirements regarding polyfluoroalkyl substances (“PFAS”). Following resolution of the PFAS issue and issuance of a FOST with respect to the other subparcel comprising the Leased Premises, Navy will convey title to the Leased Premises to City via quitclaim deed.

C. City and Sublessee entered into an Exclusive Negotiation Agreement dated July 31, 2018 (as subsequently amended, the “ENA”), providing, among other things, for City and Sublessee to negotiate terms for Sublessee to sublease the Leased Premises on an interim basis and accept title conveyance of the Leased Premises following City’s acquisition thereof from the Government. City and Sublessee subsequently negotiated and entered into a Disposition and Development Agreement dated _______________, 2022 (the “DDA”) recorded in the Official Records of the County of Solano as Instrument No. ____________, providing in part for Sublessee to sublease the Leased Premises and acquire the Leased Premises upon its conveyance by the Government to City pursuant to a form of Sublease in Furtherance of Conveyance attached as an exhibit thereto.

D. Sublessee desires to obtain use of the Leased Premises prior to the transfer of title to the Leased Premises to City, and subsequently to Sublessee, pursuant to the DDA and has requested that City sublease the Leased Premises to Sublessee pursuant to this Sub-LIFOC.

E. Sublessee acknowledges that City has agreed to sublease the Leased Premises to Sublessee under this Sub-LIFOC in a conduit capacity only. As such, Sublessee has agreed to assume all of the obligations of City as Lessee under the 1999 LIFOC, as it relates solely to the Leased Premises and pursuant and subject to the terms and conditions of the 1999 LIFOC which exist on the Effective Date, and to perform its other obligations set forth herein. Sublessee further acknowledges that City has agreed to sublease the Leased Premises to Sublessee under this Sub-LIFOC based on Sublessee agreeing to accept conveyance of the Leased Premises from OAK #4843-5079-9573 v18 Exhibit E Page 2
City immediately following conveyance of the Leased Premises by the Government to City as part of a joint escrow as provided in, and subject to, the terms and conditions of the DDA, and Sublessee has agreed to such requirement and obligation.

A G R E E M E N T
NOW THEREFORE, in consideration of the foregoing recitals and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties agree as follows:

1. Capitalized Terms. Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the 1999 LIFOC, unless otherwise indicated.

2. Leased Premises. City subleases to Sublessee and Sublessee subleases from City, on the terms and conditions of this Sub-LIFOC, the Leased Premises.

3. Term. The "Term" of this Sub-LIFOC shall commence on the Effective Date ("Commencement Date") and expire on the first to occur of (a) the date which is immediately prior to the expiration date of the 1999 LIFOC term, currently September 29, 2049 ("Expiration Date”); or (b) the effective date of conveyance by quitclaim deed of the Leased Premises from City to Sublessee pursuant to the DDA; or (c) the date on which City consummates the exercise of the City’s option to repurchase, reenter and take possession of property previously conveyed by City to Sublessee, as Developer, pursuant to section 806 of the DDA; unless sooner terminated pursuant to the terms of this Sub-LIFOC (including without limitation those provisions of the 1999 LIFOC that are incorporated herein by reference). In the event of a conveyance by City to Sublessee of title to only a portion of the Leased Premises, then this SubLIFOC shall be deemed terminated only as to such portion so conveyed and, if requested by City or Sublessee, the parties shall execute an amendment of this Sub-LIFOC memorializing the reduction in the size of the Leased Premises subject to this Sub-LIFOC.

4. Rent. Sublessee shall pay to City as "Base Rent" for the term of this Sub-LIFOC the sum of One Dollar ($1.00), payable concurrently with execution of this Sub-LIFOC and receipt of which is acknowledged hereby. Sublessee shall pay to City as "Additional Rent" any and all other amounts of any kind that become due or payable by City to Government or third parties under the terms of the 1999 LIFOC, within thirty (30) days of Sublessee's receipt of written demand therefor, which demand shall include copies of all applicable Government invoices and statements, and all other cost documents verification. Base Rent and Additional Rent are collectively referred to herein as "Rent". Sublessee's obligation to pay Rent under this Sub-LIFOC survives the Term to the extent such obligation has not been fulfilled during the Term.

5. 1999 LIFOC. A copy of the 1999 LIFOC is attached to this Sub-LIFOC as Exhibit B and, except as set forth below, is incorporated herein by reference. This Sub-LIFOC is subject to all provisions of the 1999 LIFOC, and Sublessee shall not permit any act or omission to act that will violate any of the provisions of the 1999 LIFOC. Notwithstanding the foregoing, nothing in this Sub-LIFOC shall in any way be construed as making Sublessee liable in any way for any violations of the 1999 LIFOC or any obligations of City under the 1999 LIFOC to the OAK #4843-5079-9573 v18 Exhibit E Page 3
extent occurring or accruing prior to the Commencement Date. City hereby represents and warrants to City’s knowledge that the 1999 LIFOC attached hereto is in full force and effect, has not been modified or amended in any way other than pursuant to the written documents and instruments attached as exhibits hereto, and there are no outstanding defaults or claims of default currently existing with respect to the 1999 LIFOC by either City or Government. As used herein, to “City’s knowledge” means the current, actual knowledge of Paul Kelley, Special Advisor to the City Manager/Economic Development Manager.

6. Incorporation by Reference; Performance; Assumption.

A. Incorporation; Interpretation. Except as otherwise set forth in this SubLIFOC, as applied to this Sub-LIFOC, the words "Government" or "United States of America" in the 1999 LIFOC shall be deemed to refer to City, the words "Lessee" shall be deemed to refer to Sublessee and the word "Sublessee" shall be deemed to refer to Sublessee's subtenants.

Except as otherwise expressly provided herein, Sublessee shall perform to City or directly to Government, as appropriate, all of Lessee's obligations under the 1999 LIFOC accruing from and after the Effective Date. In the event of a conflict between the terms of the 1999 LIFOC and the terms of this Sub-LIFOC, the terms of this Sub-LIFOC will control as to disputes between City and Sublessee only.

B. Exceptions.
(i) The following provisions of the 1999 LIFOC are expressly omitted from this Sub-LIFOC: Section 1, Section 2, Subsection 3.1 (first and last sentences only), Subsection 5.1.1 (first sentence from "Government hereby" through "terms and conditions:"), Subsection 5.3, Subsection 7.1, Subsection 7.3 (last sentence), Subsection 9.1 (first sentence from "Government consent" through "(H) and the"), Subsection 11.2 (from "except as may be" through the end of that subsection), Subsection 14.14 (and all subsections thereof), Subsection

14.16 (from "excepted as" through the end of that subsection), Subsection 14.20 (from "until any inspections" through the end of that Subsection), Subsection 14.21 (first clause only), Subsection

14.23, Subsection 14.25, Subsection 15.2 (except the first sentence), Subsection 15.2.1, Subsection 15.3, Section 18 (including all subsections thereof), Addendum (a) to the 1999 LIFOC (in its entirety), and Exhibit I to the 1999 LIFOC (in its entirety including all appendices thereto).
(ii) The words "Government" or "United States of America" in the following 1999 LIFOC provisions shall be deemed to refer to The United States of America, acting by and through the Department of the Navy, only: Section 8, Subsection 10.2 (including all references thereto, wherever appearing), Section 12 (including all subsections thereof), Subsection 14.4 (fourth sentence only), Subsection 14.17, Section 20, Section 24 (including all subsections thereof), Section 29, and Section 33.
(iii) The words "Government" or "United States of America" in the following 1999 LIFOC provisions shall be deemed to refer to The United States of America, acting by and through the Department of the Navy, and the City: Subsection 3.2, Subsection 4.1, Subsection 4.2, Subsection 5.2, Subsection 7.2, Subsection 7.3, Subsection 9.1 (except portion omitted per Subsection 6.B.(i)of this Sub-LIFOC), Subsection 11.2 (except portion omitted per OAK #4843-5079-9573 v18 Exhibit E Page 4
Subsection 6.B.(i)of this Sub-LIFOC), Section 14 (including all subsections except Subsection

14.2 (first two sentences only)), Subsection 14.4 (fourth sentence only), Subsection 14.5, Subsection 14.6, Subsection 14.9, and those subsections or portions thereof omitted per Subsection 6.B.(i)of this Sub-LIFOC), Subsection 15.2 (first sentence only), and Section 17. (iv) The words "Government" or "United States of America" in the following 1999 LIFOC provisions shall be deemed to refer to The United States of America, acting by and through the Department of the Navy, or the City, as applicable: Section 10 (but not including subsections thereof unless otherwise specified), Subsection 10.1, Subsection 14.5, Subsection 14.6, Subsection 14.9, Section 16, and Section 19. (v) The word "Lease" in the 1999 LIFOC shall be deemed to refer to both the 1999 LIFOC and this Sub-LIFOC.
(vi) The word "Lessee" in Section 24 (including all subsections thereof) of the 1999 LIFOC shall be deemed to refer to Sublessee only. (vii) The word "City" in Section 20 of the 1999 LIFOC shall be deemed to refer to City or Sublessee, as applicable.
(viii) The recitals as set forth in the 1999 LIFOC shall remain as originally drafted therein, with no changes to any of the parties or defined terms contained therein.

C. No Assumption by City. Notwithstanding anything in the 1999 LIFOC or this Sub-LIFOC to the contrary, City does not assume the obligations of the Government under the provisions of the 1999 LIFOC, but shall exercise good faith, reasonable efforts in attempting to cause the Government to perform its obligations under the 1999 LIFOC for the benefit of Sublessee. Further, Sublessee, to the extent permitted by applicable Law, shall have the right, acting on behalf of and/or in the place of City, to directly enforce the terms and conditions of the 1999 LIFOC and exercise the rights of the “Lessee” against Government thereunder.

7. Insurance and Exculpation.

A. Insurance. Sublessee shall, at Sublessee's expense, obtain and keep in force at all times during the Term insurance that meets all of the requirements set forth in Exhibit L to the DDA.

B. Notification of Incidents. Sublessee shall notify City within twenty-four (24) hours after the occurrence of any accident or incident on or about the Leased Premises or any portion thereof which could give rise to a claim against City, City's Insurance, Government, Sublessee, or Sublessee's Insurance, except that Sublessee shall not be obligated to give City notice of any accident or incident which could give rise to a claim under Sublessee's workers' compensation insurance. Sublessee's notice shall be accompanied by a copy of any report(s) relating to the accident or incident.

C. Compliance With Insurance Requirements, Warranties. Sublessee shall not do anything on or about the Leased Premises, or bring or keep anything therein, or subject OAK #4843-5079-9573 v18 Exhibit E Page 5
the Leased Premises or any portion thereof to any use which would damage the same or increase the risk of loss or fire, or violate City's Insurance, or Sublessee's Insurance, or which shall conflict with the regulations of the fire department or applicable Laws or with any insurance policy on the Leased Premises or any part thereof, or with any rules or regulation established by any administrative body or official having jurisdiction. Sublessee shall promptly comply with the reasonable requirements of any board of fire insurance underwriters or other similar body now or hereafter constituted. Sublessee shall not take any action which would abrogate any warranties.

D. Exemption of City from Liability. Sublessee, as a material part of the consideration to City, hereby assumes all risk of damage to property including, but not limited to, Sublessee's Property, or injury to or death of persons in, upon or about the Leased Premises arising from any cause from and after the Commencement Date, and Sublessee hereby waives all claims in respect thereof against City, except to the extent such claims are caused by City's or its employees’, agents’, contractors’, or representatives’ negligence or willful misconduct, or that of the Government, and further excluding damage and loss resulting from the breach of the 1999 LIFOC by City or Government and/or the breach of this Sub-LIFOC by City. Sublessee hereby agrees that City shall not be liable for injury to Sublessee's business or any loss of income therefrom or for damage to the property of Sublessee, or injury to or death of Sublessee, Sublessee Parties ("Sublessee Parties" shall mean Sublessee and the members of Sublessee, and its and their respective officers, directors, partners, members, managers, employees, agents, representatives, successors and assigns) or any other person on or about the Leased Premises or any portion thereof, whether such damage or injury is caused by fire, steam, electricity, gas, water or rain, or from the breakage, leakage or other defects of utility systems, or from any other cause, whether said damage or injury results from conditions arising on or about the Leased Premises or from other sources or places, and regardless of whether the cause of such damage or injury or the means of repairing the same is inaccessible to Sublessee, except to the extent such damage or injury is caused by City's, or its employees’, agents’, contractors’, or representatives’ negligence or willful misconduct, the breach of the 1999 LIFOC and/or this Sub-LIFOC by City.

City shall not be liable for any damages arising from any act or neglect of any other subtenant or licensee or City's failure to enforce the terms of any agreements with parties other than Sublessee. The provisions of this subsection 7.D shall survive the termination of this SubLIFOC with respect to any claims occurring prior to such termination.

8. Intentionally Omitted.

9. Utility Services. City in no way warrants the adequacy of any of the existing utility systems serving the Leased Premises and will not be responsible during the Term of this Sub-LIFOC for any maintenance, alteration or repair of any part of said utility systems.

10. Termination of LIFOC upon Conveyance; Potential for Conversion to Direct Lease. Subsection 15.1 of the 1999 LIFOC provides for immediate termination of the 1999 LIFOC with respect the portion of the Leased Premises that has been conveyed by the Government to City (the “Conveyed Portion”). If, for any reason City agrees to accept conveyance from the Navy of all or a portion of the Leased Premises and such portion is not immediately conveyed to Sublessee through a back-to-back escrow as contemplated by the DDA then, as to the Conveyed Portion, this Sub-LIFOC shall be considered a direct lease from City to OAK #4843-5079-9573 v18 Exhibit E Page 6
Sublessee on all of the same terms and conditions as set forth herein. Upon close of escrow and delivery to Sublessee, in accordance with the terms of the DDA, of quitclaim deed between City and Sublessee conveying to Sublessee title to any portion of the Leased Premises, including any previously Conveyed Portion, this Sub-LIFOC (or, if applicable, the direct lease) shall automatically terminate with respect to the Leased Premises (or portion thereof conveyed) as if such date were the stated Expiration Date contained herein and neither party hereto shall have any further obligations under this Sub-LIFOC with respect to the Leased Premises (or portion thereof conveyed) after such termination date, other than any obligations which otherwise would survive termination of this Sub-LIFOC.

11. Notices. All written notices to be given to City or Sublessee in connection with this Sub-LIFOC shall be in writing and given by (a) certified mail, return receipt requested and postage prepaid, (b) personal delivery, or (c) nationally recognized reputable overnight courier (but not by facsimile or email), addressed to the party entitled to receive such notice at the address specified below by such party, or changed by written notice in accordance with this section. Any notice shall be deemed received on the date of delivery if delivered by personal service, on the date of delivery or refused delivery as shown by the return receipt if sent by certified mail, and on the date of delivery or refused delivery as shown by the records of the overnight courier if sent via courier. If notice is received on a Saturday or a Sunday or a legal holiday, it shall be deemed received on the next business day. All written notices to be given to Government shall be sent to the then current address of the Department of the Navy BRAC – Program Management Office; the address for Department of the Navy BRAC as of the Effective Date is set forth below. Notices sent by a party’s attorney on behalf of such party shall be deemed delivered by such party.

City: City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590-5934
Attn: City Manager
Tel: (707) 648-4576
With copies to: City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590-5934
Attn: City Attorney
Tel: (707) 648-4545
and: City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590-5934
Attn: Economic Development Manager
Tel: (707) 648-4444
OAK #4843-5079-9573 v18 Exhibit E Page 7
and: Gerald J. Ramiza, Esq.

Burke, Williams & Sorensen, LLP
1901 Harrison Street, 9th Floor
Oakland, CA 94612-3501
Tel: (510) 273-8780
Sublessee: c/o Southern Land Company, LLC
3990 Hillsboro Pike, Suite 400
Nashville, TN 37215
Attention: Legal Department
Email: [email protected]
Navy: Department of the Navy BRAC – Program Management
Office
33000 Nixie Way – Building 50, Suite 207
San Diego, CA 92147
Tel: (619) 524-5096

12. Assignment and Subletting. In addition to the 1999 LIFOC restrictions, Sublessee shall not sublet, transfer or assign all or any portion of its interests, rights or obligations under this Sub-LIFOC without the prior written approval of the City which may be granted, denied or conditioned in City's sole, absolute discretion; provided any transfer permitted under the DDA shall also be permitted under this Sub-LIFOC, subject to the applicable terms and conditions of the DDA. Excluding the transfers permitted under the DDA, no sublease, transfer or assignment shall be recognized under this Sub-LIFOC, nor shall any person or entity acquire any rights hereunder by virtue of such transfer or assignment, unless and until approved by City in its sole discretion as provided above, and by Government pursuant to the 1999 LIFOC.

13. Obtaining the Government's Consent. Whenever the consent or approval of the Government is required under the 1999 LIFOC, City agrees to use reasonable, good faith efforts to obtain such consent or approval on behalf of Sublessee. Notwithstanding anything in this Sub-LIFOC or the 1999 LIFOC to the contrary, any action taken by Sublessee for which such approval is required under the terms and conditions of the 1999 LIFOC, and such approval is not obtained or is denied, shall be voidable by Government, and City shall bear no liability to Sublessee in connection therewith.

14. Notice by the Government to City. Whenever City receives notice from the Government under the 1999 LIFOC that may in any way affect the rights of Sublessee or the Leased Premises, City shall deliver such notice to Sublessee as soon as possible, but in no event later than five (5) business days after City receives such notice.

15. Hazardous Materials. Except with respect to Pre-existing Conditions, as defined in Section 18, City and Sublessee agree as follows with respect to the existence or use of Hazardous Materials on the Leased Premises. Obligations of Sublessee hereunder are in addition to those set forth in the 1999 LIFOC, and assumed by Sublessee pursuant to this Sub-LIFOC.

OAK #4843-5079-9573 v18 Exhibit E Page 8
A. "Environmental Laws" shall mean all present and future applicable Laws pertaining to Hazardous Materials (including, without limitation, the use, handling, transportation, production, disposal, discharge or storage thereof) or the environmental conditions on, under or about the Leased Premises and to the protection of human health or the environment.

B. "Hazardous Materials" shall mean any hazardous or toxic substance, material or waste the storage, use, or disposition of which is or becomes regulated by any local governmental authority, the State of California or the United States Government. The term Hazardous Material includes, without limitation, any material or substance which is (i) defined as a hazardous or extremely hazardous waste pursuant to Article II of Title 22 of the California Administrative Code, Division 4, Chapter 20, (ii) defined as a hazardous waste pursuant to Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. 6901 et seq. ("42 U.S.C. 69093"), (iii) defined as a hazardous substance pursuant to Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. 9601 et seq. ("42 U.S.C. 9601") or (iv) is listed or defined as a hazardous waste, hazardous substance, or other similar designation by any regulatory scheme of the State of California or the United States Government that is similar to the foregoing.

C. Except as contemplated by the terms and conditions of a relevant Government approval, Sublessee shall not use, generate, manufacture, produce, store, release, discharge, or dispose of, on, under or about the Leased Premises or transport to or from the Leased Premises any Hazardous Material or allow its members or its or their officers, employees, agents, contractors, subcontractors, licenses, invitees or subtenants (collectively, "Sublessee's Agents") to do so; provided, however, that materials containing Hazardous Materials which are normally, prudently and properly used in connection with the operations of Sublessee's subtenants and the operation and maintenance of improvements, if any, of the same type as those located on the Leased Premises may by stored and used on the Leased Premises, in reasonably necessary quantities, provided such use and storage is incidental to and reasonably necessary for the normal, prudent and proper operation and maintenance of the improvements, and in all respects in strict compliance with all Environmental Laws. Sublessee shall comply with and shall cause Sublessee's Agents to comply with, and shall keep and maintain the Leased Premises and cause Sublessee's Agents to keep and maintain the Leased Premises in compliance with all Environmental Laws.

D. Sublessee shall give written notice to City promptly after Sublessee receives actual notice of any of the following: (i) any proceeding or inquiry by, notice from, or order of any governmental authority (including, without limitation, the California State Department of Toxic Substances Control) with respect to the presence of any Hazardous Material on, under or about the Leased Premises or the migration thereof from or to other property; and (ii) all claims made or threatened by any third party against Sublessee or the Leased Premises relating to any loss or injury resulting from any Hazardous Materials.

Sublessee shall give written notice to City promptly after Sublessee obtains actual knowledge of any spill, release or discharge of Hazardous Materials with respect to the Leased Premises by Sublessee or Sublessee's Agents.

OAK #4843-5079-9573 v18 Exhibit E Page 9
E. Sublessee shall protect, defend, indemnify and hold harmless City, its elected officials, employees, officers, volunteers, contractors, agents, successors and assigns from and against any and all claims, actions, causes of action, suits, debts, liens, demands, contracts, liabilities, costs, expenses, losses, fines, judgments, penalties, damages, or liability (including reasonable attorneys' fees and costs) (collectively, "Claims") to the extent directly or indirectly arising out of or attributable to the action of Sublessee or Sublessee's Agents after the Commencement Date in connection with the use, generation, manufacture, production, storage, release, threatened release, discharge or disposal of any Hazardous Material on, under or about the Leased Premises or the transportation of any Hazardous Material to or from the Leased Premises by Sublessee or Sublessee's Agents including, without limitation, the costs of any investigation, monitoring, removal, restoration, abatement, repair, cleanup, detoxification or other ameliorative work of any kind or nature arising therefrom and required by any governmental authority whether or not permitted or contemplated by the terms and conditions of any Government approval (collectively, "Remedial Work").

F. Upon receiving actual or constructive notice of any spill or release of Hazardous Materials by Sublessee or Sublessee's Agents, Sublessee shall promptly notify City of the spill or release of Hazardous Materials and shall, at its sole expense and promptly after demand by City, commence to perform and thereafter diligently prosecute to completion such Remedial Work as is required under Environmental Laws.

16. EBS and FOSL Notification. Sublessee acknowledges that it has received a copy of and reviewed the Environmental Baseline Study ("EBS") and the Finding of Suitability to Lease ("FOSL") attached to the 1999 LIFOC as Exhibits A and C, respectively, including, without limitation, those provisions and restrictions relating to lead-based paint, unexploded ordnance safety arcs, asbestos containing materials, and other known health and safety matters at the Leased Premises.

17. Non-Interference with Government Regulator Operations; Unexploded Ordnance Removal, Lead Based Paint and Asbestos Requirements.

A. Non-Interference with Government Regulator Operations. Sublessee shall not conduct any operations, install any improvements or make any alterations at the Leased Premises that interfere with or restrict operations, environmental cleanup or restoration actions by the Government, the Department of the Navy, the Environmental Protection Agency ("EPA"), State of California environmental regulators (e.g., DTSC and the Regional Water Quality Control Board, San Francisco Bay Region), or its or their contractors (collectively, "Government Regulators"). Environmental clean-up, restoration and testing activities by said Government Regulators shall take priority over Sublessee's use of the Leased Premises in the event of any conflict.

B. Unexploded Ordnance Removal. Sublessee acknowledges that (i) areas of the Leased Premises may from time to time be made subject to ordnance safety arcs in accordance with the terms of the 1999 LIFOC; and (ii) that during the period of any unexploded ordnance ("UXO") removal, Sublessee shall be prohibited from entering said areas of the Leased Premises. Sublessee expressly assumes such risk and shall not be entitled to any abatement of OAK #4843-5079-9573 v18 Exhibit E Page 10
rent or other remedies under this Sub-LIFOC or otherwise, during the period of any UXO removal.

C. Asbestos Containing Materials. During the term of this Sub-LIFOC, and to the extent not the obligation of the Government pursuant to the 1999 LIFOC, including, without limitation, paragraph 14.14.2 thereof, Sublessee shall, at its sole expense, cause the removal, remediation or abatement of any asbestos containing materials (“ACM”) which deteriorate through the passage of time or which become damaged as a result of a natural disaster or the activities of Sublessee, its members, employees, agents, contractors or subcontractors, but only to the extent such removal, remediation, or abatement is, at such time, required under applicable Laws. In the event of an emergency abatement event, Sublessee shall notify the Government as soon as practicable of its emergency ACM response plan. Sublessee shall, at its expense, monitor the condition of existing ACM on the Leased Premises for deterioration or damage and shall accomplish repairs or abatement, as necessary, pursuant to the applicable provisions of this Sub-LIFOC. If Sublessee desires to make any improvements, repairs or alterations requiring the removal of ACM, Sublessee shall, at its expense, prepare an appropriate ACM disposal plan and submit such disposal plan to the Government for its review and approval. The ACM disposal plan shall either identify the ACM disposal site or provide for such disposal at a licensed facility authorized to receive ACM.

D. Lead Based Paint Property. During the Term of this Sub-LIFOC, and to the extent not the obligation of the Government pursuant to the 1999 LIFOC, Sublessee shall, at is sole expense, manage and, if, to the extent, and when required by applicable Law, cause the removal, remediation or abatement of any lead-based paint property and shall comply with all applicable Federal, State and local laws, in compliance with, and to the extent required by, the terms of the 1999 LIFOC.

18. Additional Requirements.

A. Pre-Existing Conditions. If, during the performance of any work of improvements or alterations at the Leased Premises, Sublessee encounters pre-existing conditions caused by the Government which may require the Government to take action in accordance with Federal, State or local laws, or pursuant to any agreement to which the Government is a party, to remove, remediate, correct or abate Hazardous Materials, pollutants or contaminants ("Pre-existing Conditions"), except where such Pre-existing Conditions are encountered in accordance with the terms and conditions of a relevant Government approval, Sublessee shall promptly notify City and the Government of such Pre-existing Conditions and shall immediately cease all work of improvements or alterations and secure the work site, to the extent incompatible with such remediation of Pre-existing Conditions as reasonably determined by the City and/or Government. If deemed reasonably necessary by the City or the Government, Sublessee shall promptly vacate the portion of the Leased Premises on which the Pre-existing Conditions are located. Sublessee shall not be entitled to any abatement of rent as a result of any Pre-existing Conditions or any required vacation of the Leased Premises.

B. Notice Regarding Holders. Sublessee shall deliver to City a list of all holders of any permitted subleasehold mortgage, subleasehold deed of trust or other subleasehold OAK #4843-5079-9573 v18 Exhibit E Page 11
security interest in the Leased Premises, or any portion thereof, within ten (10) business days after receipt of City's written request.

C. Compliance with Laws. Sublessee at Sublessee's sole expense, shall comply with all applicable statutes, laws, codes, rules, orders, zoning, ordinances, directions, regulations, regulations, permits, or other requirements of federal, state, county, municipal, or other governmental authorities having jurisdiction, now in force or which may hereafter be in force (individually and collectively, "Law(s) "), which shall impose any duty upon City or Sublessee with respect to the use, occupancy, or alteration of the Leased Premises during the Term of this Sub-LIFOC.

19. General Release. Except to the extent of any Claims caused by the City's sole active negligence or willful misconduct, Sublessee releases and forever discharges the City Parties (defined below) from any and all known or unknown Claims which the Sublessee Parties (defined above) have or may have against the City Parties, including but not limited to Claims of property damage, bodily injury including death, consequential damage, incidental damage, damage to reputation, loss of existing, future or potential business, loss of good will, attorneys' fees, costs and expenses arising out of (i) environmental clean-up, restoration and testing activities by Government Regulators, (ii) UXO removal, (iii) Lead Remediation, (iv) ACM removal, remediation and abatement, and (v) Pre-existing Conditions. "City Parties" shall mean the City and its elected officials, employees, agents, contractors, volunteers, attorneys, successors and assigns. Sublessee hereby acknowledges that it has been advised by legal counsel and is familiar with Section 1542 of the California Civil Code, which provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE

CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO

EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE

RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE

MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR OR RELEASED PARTY."
Sublessee further acknowledges that this Sub-LIFOC has been negotiated and executed with full knowledge of potential unknown or unsuspected damage, loss, cost or expense and expressly waives any and all rights which the Sublessee Parties may have under California Civil Code Section 1542 or any other state or federal statute or common law principle of similar effect.

20. Intentionally Omitted.

21. Labor Provisions of 1999 LIFOC. Sublessee shall comply with all of the requirements set forth in Section 19 of the 1999 LIFOC, if and as required by applicable Laws.

22. Taxes. As used in this Lease "Taxes" means Property Taxes, Possessory Interest Taxes, Personal Taxes, Municipal Service Charges, and any other taxes or assessments.

Sublessee's obligations for Taxes for the last full or partial year of the Term and for any prior unpaid Taxes shall survive the expiration or earlier termination of this Lease.

OAK #4843-5079-9573 v18 Exhibit E Page 12
A. Real Property Taxes. Although no Property Taxes are currently assessed, in the event they are assessed, then Sublessee shall pay to City any and all such Property Taxes in each calendar year on or before the date which is thirty (30) calendar days prior to the date such Property Taxes are due. City shall deliver to Sublessee an invoice, with reasonable supporting documentation, not less than twenty (20) days prior to the date on which such payment is due from Sublessee to City. Should Sublessee fail to pay the Property Taxes, City may elect to do so on Sublessee's behalf. Sublessee will thereafter be required to pay the Property Taxes. Notwithstanding the foregoing, City may, from time to time and in City's sole discretion, require that Sublessee pay such amounts in monthly installments of onetwelfth (1/12th) thereof on the first calendar day of each month. Property Taxes for partial tax fiscal years, if any, falling within the Term, shall be prorated on a per diem basis. (i) Definition of Property Taxes. "Property Taxes" shall be the sum of the following: all real property taxes, business or license taxes or fees, service payments in lieu of such taxes or fees, annual or periodic license or use fees, excises, transit and traffic charges, housing fund assessments, open space charges, child care fees, school, sewer and parking fees, public infrastructure improvement assessments or any other assessments, levies, fees, exactions or charges, general and special, ordinary and extraordinary, unforeseen as well as foreseen (including fees "in lieu" of any such tax or assessment) which are assessed, levied, charged, conferred or imposed by any public authority upon the Leased Premises or portion thereof or its operations, together with all taxes, assessments or other fees imposed by any public authority upon or measured by any Rent or other charges payable hereunder, including any gross receipts tax or excise tax levied by any governmental authority with respect to receipt of rental income, or upon, with respect to or by reason of the development, possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy by Sublessee of the Leased Premises or any portion thereof, or documentary transfer taxes upon this transaction or any document to which Sublessee is a party creating or transferring an interest in the Leased Premises, together with any tax imposed in substitution, partially or totally, of any tax previously included within the aforesaid definition or any additional tax the nature of which was previously included within the aforesaid definition.
(ii) Statement Regarding Possessory Interest Tax. This Lease creates a possessory property interest in Sublessee. Sublessee's property interest may be subject to property taxation, and Sublessee or the party in whom the possessory interest is vested may be subject to the payment of property taxes levied on the interest. Such taxes are referred to herein as "Possessory Interest Taxes".

B. Personal Taxes. Sublessee shall pay directly to the taxing authority all taxes and assessments levied upon the trade fixtures, alterations, additions, improvements, equipment, inventories and other personal property located and/or installed on the Leased Premises by Sublessee, if any (individually and collectively "Sublessee's Property"). Such taxes are referred to herein as "Personal Taxes".

C. Payment of Taxes. Sublessee shall pay all Taxes prior to delinquency. To the extent any such taxes are not separately assessed or billed to Sublessee by the taxing authority, City shall deliver to Sublessee copies of the assessment and tax bill together with a statement of Sublessee's share of taxes. Sublessee shall pay the amount reasonably allocated to OAK #4843-5079-9573 v18 Exhibit E Page 13
Sublessee no later than thirty (30) days prior to the date on which such Taxes are due. Taxes attributable to any of Sublessee's personal property shall be charged to and paid by Sublessee.

Should Sublessee fail to pay its Taxes prior to delinquency, City may elect to do so on Sublessee's behalf and, if City so elects, Sublessee will thereafter be required to pay said Taxes and interest at the Applicable Interest Rate, from the date City tendered payment, until the date Sublessee fully reimburses City.

23. Events of Default. Any of the following events or occurrences shall constitute a material breach of this Sub-LIFOC by Sublessee and, after the expiration of any applicable cure period, shall constitute an event of default (each an "Event of Default"):

A. The failure by Sublessee to pay any amount in full when it is due under this Sub-LIFOC, said failure continuing for a period of five (5) business days after receipt of written notice that the same is due; or
B. The failure by Sublessee to perform any other obligation under this SubLIFOC, if the failure has continued for a period of thirty (30) days after City demands in writing that Sublessee cure the failure. If, however, by its nature the failure cannot be cured within thirty (30) days, Sublessee may have a longer period as is necessary to cure the failure, but this is conditioned upon Sublessee's promptly commencing to cure within the thirty (30) day period and thereafter diligently completing the cure; or
C. The appointment of a trustee or receiver to take possession of all or substantially all of Sublessee's assets; or the attachment, execution or other judicial seizure of all or substantially all of Sublessee's assets located at the Leased Premises or of Sublessee's interest in this Sub-LIFOC, unless the appointment or attachment, execution, or seizure is discharged within thirty (30) days; or the involuntary filing against Sublessee, of (i) a petition to have Sublessee declared bankrupt, or (ii) a petition for reorganization or arrangement of Sublessee under any law relating to insolvency or bankruptcy, unless, in the case of any involuntary filing, it is dismissed within sixty (60) days; or
D. Sublessee is in default under the DDA following notice and expiration of applicable cure periods.

24. Remedies. Upon the occurrence of an Event of Default, and after expiration of any applicable notice and cure period, City, in addition to any other rights or remedies available to City at law or in equity, shall have the right to terminate this Sub-LIFOC and all rights of Sublessee under this Sub-LIFOC by giving Sublessee written notice that this Sub-LIFOC is terminated. Except where inconsistent with or contrary to any express provisions of this SubLIFOC or the DDA, no right or remedy conferred upon or reserved to either party is intended to be exclusive of any other right or remedy, or any right or remedy given or now or later existing at law or in equity or by statute.

25. Default Interest. If Sublessee fails to pay any amount due under this Sub-LIFOC that amount shall bear interest at the rate of ten percent (10%) per annum from the due date until paid, or at such lower rate as may be the highest rate legally permitted ("Applicable Interest Rate").

OAK #4843-5079-9573 v18 Exhibit E Page 14

26. Arbitration of Disputes Involving the Government. Any claim or dispute arising out of or relating to this Sub-LIFOC, which also involves the Government, shall be settled in accordance with the alternative dispute resolution provisions set forth in Section 24 of the 1999 LIFOC, which section is incorporated herein only as to such disputes.

27. Ambiguities. This Sub-LIFOC has been negotiated at arm's length and between persons sophisticated and knowledgeable in the matters dealt with in this Sub-LIFOC.

Accordingly, any rule of law (including Civil Code Section 1654) or legal decision that would require interpretation of any ambiguities in this Sub-LIFOC against the party that has drafted it is not applicable and is waived. The provisions of this Sub-LIFOC shall be interpreted in a reasonable manner to effect the purpose of the parties.

28. Other Events of Termination. Sublessee acknowledges that the Government has the right, following expiration of applicable cure periods, to terminate the 1999 LIFOC upon the occurrence of any of the events set forth in paragraph 15.2 thereof. In the event of such termination of the 1999 LIFOC, this Sub-LIFOC, together with any subleases entered into pursuant to this Sub-LIFOC, shall automatically terminate.

29. Relocation Waiver. Sublessee fully releases and discharges City and Government from all and any manner of rights, benefits, demands, liabilities, obligations, claims, or cause of actions, in law or equity, of whatever kind or nature, whether known or unknown, whether now existing or hereinafter arising, which arise from or relate in any manner to the relocation of Sublessee's business operations or the relocation of any person or persons, business or businesses, or other occupant or occupants located on the Leased Premises upon the expiration or earlier termination of this Sub-LIFOC, including, without limitation, the specific waiver and release of any right to any relocation benefits, assistance and/or payments under federal or state law, including Government Code Sections 7260 et seq. (collectively, "Relocation Assistance Law").

30. Use of Leased Premises; NEPA Review. Sublessee shall use the Leased Premises exclusively (i) for the purposes set forth in the Mare Island Final Reuse Plan or the Mare Island Specific Plan, as adopted, and as amended, by ordinance of the City, subject to the uses being consistent with the National Environmental Policy Act ("NEPA") Record of Decision for the disposal and reuse of the former Mare Island Naval Shipyard, (ii) in accordance with the restrictions and requirements set forth in the 1999 LIFOC, including the FOSL attached thereto as Exhibit C, and (iii) in a manner consistent with all applicable Laws, including City zoning requirements, and the conditions of all City land use approvals and permits. Subject to all applicable Laws, Sublessee may modify the use of the Leased Premises with the prior written consent of the City and the Government. City shall not unreasonably withhold, condition or delay its consent to such a proposed modification. If the Government determines, in connection with a proposed modification in use of the Leased Premises, that additional NEPA review is necessary, applicable NEPA documentation shall be prepared by City at Sublessee's expense.

Sublessee shall pay to City upon demand any and all costs which Sublessee is obligated to pay under this Section 30.

OAK #4843-5079-9573 v18 Exhibit E Page 15

31. Successors in Interest. Subject to the restrictions on assignment and subletting set forth in Section 12 hereof and in Paragraph 5 of the 1999 LIFOC, this Sub-LIFOC shall be binding on and shall inure to the benefit of the heirs, executors, administrators, successors, and assigns of City and Sublessee.

32. Severability. Should any provision of this Sub-LIFOC be held by a court of competent jurisdiction to be either invalid or unenforceable, the remaining provisions of this Sub-LIFOC shall remain in effect to the fullest extent allowed by law.

33. Attorneys' Fees. If any action at law or in equity is brought to recover any Rent or other sums due under this Sub-LIFOC, or for or on account of any breach of, or to enforce or interpret any of, the covenants, terms, or conditions of this Sub-LIFOC, or for the recovery of possession of the Leased Premises, the prevailing party shall be entitled to recover from the other party as part of prevailing party's costs reasonable attorneys' fees, the amount of which shall be fixed by the court and shall be made a part of any judgment rendered.

34. Amendments. This Sub-LIFOC may be modified only in writing and only if signed by the parties.

35. Execution. By their signatures below, each of the following represents that it has authority to execute this Sub-LIFOC and to bind the party on whose behalf the execution is made.

36. Counterparts. This Sub-LIFOC may be executed in counterparts, each of which shall be deemed an original, but all of which, taken together, shall constitute one and the same instrument. The signature pages of multiple counterparts may be combined into a single document.

37. Entire Agreement. This Sub-LIFOC (including attachments hereto), together with the DDA, represents the entire understanding and agreement of the parties with respect to the matters set forth herein. No oral statements or representations made by, for or on behalf of either party shall be a part of this Sub-LIFOC. Should a conflict arise between the provisions of this Sub-LIFOC on the one hand, and the provisions of the DDA, on the other, the provisions of this Sub-LIFOC shall control.
[Signatures follow on next page]
OAK #4843-5079-9573 v18 Exhibit E Page 16
IN WITNESS WHEREOF, the parties have executed this Sub-LIFOC as of the date first set forth above.

SUBLESSEE: CITY:

THE NIMITZ GROUP, LLC, a California
limited liability company
By: _________________________________
Name: ______________________________
Its: _________________________________
CITY OF VALLEJO, a California municipal
corporation
By: _________________________________
__________________, City Manager

ATTEST:
_________________________________
____________, City Clerk
APPROVED AS TO FORM:
_________________________________
______________, City Attorney

APPROVED AS TO INSURANCE
REQUIREMENTS:
_________________________________
_________, City Risk Manager

OAK #4843-5079-9573 v18 Exhibit E – Attachment 1 Page 1 ATTACHMENT NO. 1

LEASED PREMISES
[Legal Description -- to be inserted]

OAK #4843-5079-9573 v18 Exhibit E – Attachment 2 Page 1 ATTACHMENT NO. 2

LEASED PREMISES
[Diagram showing parcel -- to be inserted]

OAK #4843-5079-9573 v18 Exhibit E – Attachment 3 Page 1 ATTACHMENT NO. 3
1999 LIFOC
[To be inserted]

OAK #4843-5079-9573 v18 Exhibit F Page 1
Exhibit F
Quitclaim Deed

RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:

The Nimitz Group
c/o _____________________
________________________
________________________
Attn: ___________________
SPACE ABOVE THIS LINE FOR RECORDER’S USE ONLY
[Exempt from recording fee per Gov. Code § 27383]

QUITCLAIM DEED (INCLUDING COVENANTS)
(APNs: ________, ______ and _____)
This Quitclaim Deed is made this ______ day of ____________, 202__, by and between the CITY OF VALLEJO, a California municipal corporation (“Grantor”), and THE NIMITZ GROUP, LLC, a California limited liability corporation (“Grantee”).

WHEREAS, Grantor, and Grantee are parties to that certain Disposition and Development Agreement dated __________________, 2022 (“DDA”) recorded in the Official Records of the County of Solano as Instrument No. _____________, which provides for, among other things, the conveyance by Grantor to Grantee of certain City-Owned Property and Navy-Owned Property comprising a portion of Mare Island Reuse Area 1A, and Grantee’s performance of certain Developer’s Work on and about such property and certain adjacent real property owned by Grantee. Capitalized terms not otherwise defined herein shall have the meaning set forth in the DDA; and
WHEREAS, in 2001, 2008 and 2011, the United States Department of the Navy (“Navy”) approved three separate Findings of Suitability for Transfer (individually and collectively, the “FOST(s)”) determining, among other things, that the portions of Reuse Area 1A as described in each of the FOST(s) were environmentally suitable for transfer in accordance with and subject to Section 120(h)(3)(A) of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §9620 et seq. (“CERCLA”); and
WHEREAS, pursuant to the FOST(s), Navy has conveyed to City various portions of Reuse Area 1A, including the Property (described below), by Quitclaim Deeds dated September 26, 2001, October 6, 2008, and April 13, 2011, and recorded in the Official Records of the County of Solano as Instrument Nos. 2001 00120695; 2009-00004941, and 2011-00042113 respectively (individually and collectively, the “Navy Quitclaim Deed(s)”, and collectively with the FOST(s) and other documents referenced in the Navy Quitclaim Deed(s) the “Transfer Documents”); and WHEREAS, the Transfer Documents, including the covenants, warranties and indemnifications made and to be made by the Navy pursuant to 42 U.S.C. 9620(h)(3)(a)(ii) as set OAK #4843-5079-9573 v18 Exhibit F Page 2
forth in the Navy Quitclaim Deed(s), govern the respective rights and obligations of the parties thereto and their respective successors and assigns for completion of environmental response actions with respect to the applicable portions of Reuse Area 1A, including the Property; and WHEREAS, as contemplated by the DDA, Grantor and Grantee desire that Grantor convey certain property representing [Insert as applicable: all or a portion of the City-Owned Property or Navy-Owned Property] to Grantee so that Grantee may commence and complete Developer’s Work as provided in the DDA, and otherwise exercise and enjoy Developer’s rights as owner of the Property; and
WHEREAS, concurrently herewith, Grantee, as offeror, is executing and recording an irrevocable offer to dedicate to Grantor (“Irrevocable Offer”) certain existing road, street, alley and other customary appurtenant access improvements (including, without limitation, streetlights, curbs, gutters, drain inlets, signs, signals, benches and sidewalks) located on the Property (collectively, “Roadways”) and ancillary easements with respect to same; and WHEREAS, concurrently herewith, Grantor and Grantee are entering into a water system reimbursement agreement (“Water System Reimbursement Agreement”) to be recorded in the Official Records of the County pursuant to which Grantee and its successors will reimburse Grantor for the ongoing costs to be incurred by Grantor in connection with the maintenance and repair of existing potable and fire suppression water lines and ancillary above and below ground facilities and improvements located on and under the Property (collectively, “Water Lines”) until such time as Grantee or its successors have upgraded and/or replaced such Water Lines with new potable and fire suppression water lines and ancillary facilities and improvements and such new infrastructure improvements, together with customary easements for same, have been accepted by Grantor; and
WHEREAS, concurrently herewith, Grantee and Vallejo Flood and Wastewater District (“VFWD”) are entering into a sewer system reimbursement agreement (“Sewer System Reimbursement Agreement”) to be recorded in the Official Records of the County pursuant to which Grantee and its successors will reimburse VFWD for the ongoing costs to be incurred by VFWD in connection with the maintenance and repair of existing storm drains and sanitary sewer lines and ancillary above and below ground facilities and improvements located on and under the Property (collectively, “Sewer Lines”) until such time as Grantee or its successors have upgraded and/or replaced such Sewer Lines with new storm drains and sanitary sewer lines and ancillary above and below ground facilities and improvements and such new storm drains, sanitary sewer lines, facilities and improvements, together with customary easements for same, have been accepted by VFWD.

NOW THEREFORE, FOR VALUE RECEIVED, Grantor does hereby remise, release and forever quitclaim to Grantee all of Grantor's right, title and interest in and to that certain real property (“Property”) situated in the City of Vallejo, County of Solano, State of California, more particularly described in Attachment No. 1 attached hereto and by this reference incorporated herein, together with all of Grantor's right, title, and interest in and to the buildings, facilities, roadways, rail lines, and other improvements located on or about said Property, and all right, title and interest in and to all appurtenant tangible, intangible and other rights and privileges associated with such Property;
OAK #4843-5079-9573 v18 Exhibit F Page 3
EXCEPTING AND RESERVING THEREFROM THE FOLLOWING:

1. All existing Water Lines located on, under and about the Property currently operated by City, and all existing Sewer Lines located on, under and about the Property currently operated by VFWD. The Water Lines and Sewer Lines reserved hereby to City and VFWD, respectively, shall not include the lateral line pipes or conduits serving existing buildings and improvements located on or about the Property. The foregoing reservations of Water Lines and Sewer Lines shall not be deemed to release or relieve Grantee or its successors from any of its and their obligations under the Water System Reimbursement Agreement, the Sewer System Reimbursement Agreement, the Transfer Documents or the DDA, including (i) the DDA Scope of Work which specifies that Grantee must decommission and replace, rather than reuse or repurpose, substantially all existing utility and related infrastructure on the Property and (ii) Section 210 of the DDA which obligates Grantee to cause the remediation of Hazardous Materials contamination before undertaking any Site Preparation Work or other horizontal or vertical development work on or about the Property.

2. Non-exclusive easements in favor of City and VFWD for ingress, egress and access over, under and across the Property for purposes of accessing, inspecting, maintaining, repairing and, at the discretion of Grantor and/or VFWD, replacing, the Water Lines and Sewer Lines. The foregoing reserved easements shall be replaced, from time to time, as and when specific easement locations and Backbone Infrastructure improvements have been determined and such Backbone Infrastructure improvements have been satisfactorily constructed by Grantee or its successors in accordance with applicable laws and the conditions imposed in connection with Grantor’s approval of Grantee’s and its successor’s Future Applications for land use approvals, permits and entitlements, including the proposed New Specific Plan. Upon Grantee’s written request made from time to time following the replacement of the easements reserved hereby, Grantor shall execute, acknowledge and deliver to Grantee for recordation in the Official Records of Solano County, quitclaim deeds or other similar instruments evidencing the termination in whole or in part, as applicable, of the replaced easements.

GRANTEE HEREBY COVENANTS AND AGREES, FOR ITSELF AND ITS SUCCESSORS AND ASSIGNS, AS FOLLOWS:

A. All improvements constructed by Grantee on the Property shall comply with the terms of the DDA, the Existing Specific Plan and, if and when approved by City, the New Specific Plan, and Applicable Laws.

B. Except as otherwise permitted under the New Specific Plan, if any, the following uses shall be prohibited on the Property: LNG facilities, cement batch plants, dumps and heavy recycling facilities, refineries, heavy industrial uses, and cannabis cultivation and dispensary facilities.

C. Except as otherwise permitted under the New Specific Plan, if any, no more than 370,000 square feet of warehouse uses, which is the maximum amount allowed under the Existing Specific Plan, shall be permitted on the Property.

OAK #4843-5079-9573 v18 Exhibit F Page 4
D. Prior to the issuance of the Certificate of Completion, Grantee shall not, except as permitted by the DDA, sell, transfer, convey, assign or lease the whole or any part of the Property without the prior written approval of the City, with such approval to be granted or withheld in accordance with the terms and conditions of the DDA.

E. Grantee shall comply with the Transfer Documents and all Environmental Laws concerning the Property and take all reasonably necessary precautions to prevent the release of any Hazardous Materials into the environment in violation of any Environmental Laws or the Transfer Documents. In addition, Grantee shall install and utilize such equipment and implement and adhere to such procedures as are consistent with Environmental Laws and the requirements of the Transfer Documents as to the disclosure, storage, use, remediation, removal and/or disposal of Hazardous Materials. Nothing herein shall be deemed to relieve Navy of its obligations under the Transfer Documents.

F. Grantee shall notify Grantor, and provide to Grantor a copy or copies, of any and all environmental permits, or applications relating to the Property, including notices of violation, notices to comply, citations, 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 Environmental Laws.

G. In the event of a release of any Hazardous Materials onto or from the Property in violation of any Environmental Law, Grantee shall, as soon as possible after such release, furnish to Grantor a copy of any and all reports relating thereto and copies of all official correspondence with regulatory agencies relating to the release. Upon request of Grantor, Grantee shall furnish to Grantor a copy or copies of any and all other environmental work plans relating to or affecting the Property.

GRANTOR AND GRANTEE FURTHER AGREE AS FOLLOWS:

1. No violation or breach of the covenants, conditions, restrictions, provisions or limitations contained in this Quitclaim Deed shall defeat or render invalid or in any way impair the lien or charge of any mortgage, deed of trust or other financing or security instrument permitted by the DDA; provided, however, that any successor of Grantee to the Property shall be bound by such remaining covenants, conditions, restrictions, limitations and provisions, whether such successor’s title was acquired by foreclosure, deed in lieu of foreclosure, trustee’s sale or otherwise.

2. Grantee’s covenants contained in this Quitclaim Deed shall remain in effect in perpetuity.

3. Grantor is deemed the beneficiary of the terms and provisions of this Quitclaim Deed and of the covenants running with the land, for and in its own right and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Quitclaim Deed and the covenants running with the land have been provided, without regard to whether Grantor has been, remains or is an owner of any land or interest therein on Mare Island. Grantor shall have the right, if the Quitclaim Deed or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other OAK #4843-5079-9573 v18 Exhibit F Page 5
proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Quitclaim Deed and covenants may be entitled.

SUBJECT TO EXPRESS REPRESENTATIONS AND WARRANTIES OF

GRANTOR IN THE DDA, THE PROPERTY IS CONVEYED TO GRANTEE

WITHOUT WARRANTY OR COVENANT OF ANY KIND, EXPRESS OR

IMPLIED, EXCEPT THAT GRANTOR COVENANTS THAT GRANTOR HAS

NOT CONVEYED THE SAME ESTATE OR ANY RIGHT, TITLE OR
INTEREST THEREIN TO ANY PERSON OTHER THAN GRANTEE.

IN WITNESS WHEREOF, Grantor and Grantee have caused this Quitclaim Deed to be executed on their behalf by their respective officers thereunto duly authorized as of this ___________ day of ___________, 202__.
[Signatures on next page]

OAK #4843-5079-9573 v18 Exhibit F Page 6
GRANTOR:

CITY OF VALLEJO
By: ______________________
Print Name: _______________
Its: _______________
ATTEST:
______________________________
__________________, City Clerk
APPROVED AS TO FORM:
_______________________________
___________________, City Attorney

THE PROVISIONS OF THIS QUITCLAIM DEED ARE HEREBY APPROVED AND ACCEPTED.

GRANTEE:

THE NIMITZ GROUP, LLC, a California
limited liability company
By: _____________________
Print Name: _______________
Its: __________________
OAK #4843-5079-9573 v18 Exhibit F – Attachment No. 1
ATTACHMENT NO. 1

PROPERTY LEGAL DESCRIPTION
[Description of applicable City-Owned or Navy-Owned Property to be inserted] OAK #4843-5079-9573 v18 Exhibit F – Acknowledgment

ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of California )
County of )
On ____________ __, 20__ before me, , Notary Public,
personally appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: _____________________ (seal)
OAK #4843-5079-9573 v18 Exhibit F – Acknowledgment

ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of California )
County of )
On ____________ __, 20__ before me, , Notary Public,
personally appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: __________________ (seal)
OAK #4843-5079-9573 v18 Exhibit F – Acknowledgment

ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of California )
County of )
On ____________ __, 20__ before me, , Notary Public,
personally appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: ___________________ (seal)
OAK #4843-5079-9573 v18
Exhibit G
Exhibit G

INTENTIONALLY OMITTED
OAK #4843-5079-9573 v18 Exhibit H Page 1
Exhibit H

PILOT AGREEMENT

RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:

City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Clerk
Record for the Benefit of
The City of Vallejo
Pursuant to Government Code
Section 27383
Space Reserved for Recorder's Use Only

AGREEMENT FOR PAYMENT IN LIEU OF TAXES
[Property Tax Covenant]
This Agreement for Payments in Lieu of Taxes (“Agreement”) dated as of ________, 202__ (“Effective Date”), is made and entered into by and between the CITY OF VALLEJO, a California municipal corporation (“City”), and _______________, a ________________ (“Owner 1”), and THE NIMITZ GROUP, LLC, a California limited liability company (“Owner 2” and collectively with Owner 1, the “Owners”). City and Owners are referred to herein individually as a “Party” and collectively as the “Parties”.

RECITALS
A. Owner 2, as successor in interest to Lennar Mare Island, LLC, is the fee owner of one hundred seven (107) parcels and lessee of five (5) parcels of real property listed by their respective Assessor Parcel Numbers (APNs) with current AV (defined below) shown in Attachment No. 2 attached hereto and incorporated herein (“South Mare Island Property”).

B. City, as successor in interest to the United States Department of the Navy, is the fee owner of approximately 125.3 acres of Mare Island consisting of a portion of Mare Island Reuse Area 1 as generally depicted on Attachment No. 1 and more particularly described in Attachment No. 3 (“City-Owned Property”). City is also the long term lessee of an additional approximately 31.8-acre portion of Mare Island Reuse Area 1 as generally depicted on Attachment No. 1 (“Navy-Owned Property” and, collectively with the City-Owned Property, the “North Mare Island Site”). The South Mare Island Property and the City-Owned Property are referred to collectively herein as the “Mare Island Property”.

C. The North Mare Island Site is the subject of a Disposition and Development Agreement between City and Owner 1 dated __________________, 2022 (“DDA”), which has OAK #4843-5079-9573 v18 Exhibit H Page 2
been recorded in the Official Records of the County of Solano, as Instrument No. 2022- ___________.

D. Concurrently herewith City is conveying to Owner 1 the City-Owned Property so that Owner 1 may undertake certain planning work and thereafter undertake comprehensive redevelopment of the City-Owned Property and, following Owner 1’s acquisition of the Navy-Owned Property from City as provided in the DDA, the balance of North Mare Island Site, all as provided in the DDA.

E. City agreed to provide Owner 1 requested flexibility regarding timing of development of the North Mare Island Site on the condition that Owners commit to make certain property tax in lieu payments to City and the Vallejo City Unified School District (“VCUSD”) if, by the Minimum Tax Revenue Date (defined below), Owners’ development related activities have not increased the assessed value (land and improvements only) (“AV”) of the Mare Island Property for property tax purposes by a mutually agreed upon amount.

F. To effectuate the purposes of the DDA, the Parties intend that the Owners make annual payments to the City and VCUSD for the Term of this Agreement, to make up for the shortfall in the share of real property taxes payable with respect to the Mare Island Property and the improvements thereon that would have otherwise been received by the City and VCUSD but for Owners’ decision to defer development of the Mare Island Property.

NOW THEREFORE, in exchange for the mutual commitments set forth herein and other good and valuable consideration, the Parties agree as follows:

AGREEMENTS

1. Term. The term (“Term”) of this Agreement shall commence on the Effective Date set forth above and shall continue in effect until such time as the total AV of the Mare Island Property in effect for any given property tax year exceeds 110% of the Minimum Owner Property AV (defined below) in effect as of such property tax year. When the 110% threshold has been reached, City, upon written request of either of the Owners, shall execute a notice of termination or other similar instrument evidencing the termination of this Agreement.

2. Payment in Lieu of Property Taxes. The Parties acknowledge and agree that the AV of the South Mare Island Property as of the 2021/2022 tax year is $102,134,345.00. The Parties further acknowledge that based on the purchase price to be paid by Owner 1 to City per the terms of the DDA, the AV of the City-Owned Property for the tax year in which the closing occurs will be approximately equal to the $3,000,000. Owners hereby agree that if the AV of the Mare Island Property on the Minimum Tax Revenue Date (defined below) does not equal or exceed the Minimum Owner Property AV (defined below), then Owners shall pay City and VCUSD beginning on July 1 of the tax year following the Minimum Tax Revenue Date and on July 1 of each year thereafter (“Due Date”) an amount equal to the difference between the property taxes actually received by City and VCUSD based on the AV of the Mare Island Property for the property tax year in question and the property taxes that City and VCUSD would have received (i.e. 19% and 24% of the total property taxes, respectively) if the total AV of the Mare Island Property had been equal to the Minimum Owner Property AV (defined below). The OAK #4843-5079-9573 v18 Exhibit H Page 3
Parties agree that the “Minimum Owner Property AV” as of July 1 of the first year following the Minimum Tax Revenue Date shall be the amount of $144,782,913, which amount represents the sum of the South Mare Island 2021/22 AV + the City-Owned Property AV of $3M + $26,000,000, as increased by the Proposition 13 2% annual escalator for the period between the effective date of the DDA and the Minimum Tax Revenue Date (defined below). The Minimum Owner Property AV amount shall be increased annually by 2% per year each year following the Minimum Tax Revenue Date. The Parties further agree that the calculations of growth in AV for each tax year shall exclude (i) any increases in property assessed valuation resulting from construction and development related activities, if any, undertaken by City or any other governmental agency(ies) or the tenant(s) or subtenant(s) (other than Owners) of City or such other governmental agency(ies), and (ii) any increases in property assessed valuation attributable to personal property or any items other than land and improvements. The “Minimum Tax Revenue Date” shall be ____________________, 2027 [Insert date that is 5 years after the effective date of the DDA]; provided however the Minimum Tax Revenue Date shall be automatically extended by the period of any Recession (defined below) occurring between the Effective Date of this Agreement and the Minimum Tax Revenue Date set forth above. A “Recession” means a quarterly decline in the monetary value of all finished goods and services produced in the United States, as measured by initial quarterly estimates of US Gross Domestic Project (“GDP”) published by the US Department of Commerce Bureau of Economic Analysis (and not BEA’s subsequent monthly revisions), lasting more than two (2) consecutive calendar quarters. Any quarter of positive GDP growth shall end the period of such Recession. If Owners fail to make any payment by the applicable Due Date, then a late fee of ten percent of the amount due, plus interest at the rate of seven percent per annum or, if less, the maximum amount allowed by applicable law shall accrue on the amount due until paid in full.

3. Intentionally Omitted.

4. Recording; Amendment upon Acquisition of Navy-Owned Property. This Agreement shall be recorded with the County of Solano Recorder's Office upon execution. Upon City’s acquisition of fee title to the Navy-Owned Property or portion thereof from the Navy and conveyance thereof to Owner 1 pursuant to the DDA, City and Owners, upon request by either Party, shall execute and record an amendment to this Agreement to add the Navy-Owned Property or portion thereof to the Mare Island Property.

5. Future Taxes and Assessments. Nothing herein shall be deemed to limit the ability of the City to establish and impose upon the Mare Island Property in accordance with applicable law any new or increased special taxes or assessments.

6. Covenants Run with the Land. All covenants contained in this Agreement shall be covenants running with the land, but only for the duration of the Term, and thereafter shall be of no further force or effect. All covenants in this Agreement shall be binding for the benefit of the City and VCUSD and such covenants shall run in favor of the City and VCUSD for the Term, without regard to whether the City or VCUSD is or remains an owner of any land or interest therein to which such covenants relate, but only for the duration of the Term.

7. Statement of Good Faith. The Parties acknowledge and agree the payment obligations established by this Agreement were negotiated in good faith in recognition of and OAK #4843-5079-9573 v18 Exhibit H Page 4
with due consideration of the cyclical nature of the real estate development business. Each Party was represented by counsel in negotiation and preparation of this Agreement and has entered into this Agreement after full and due consideration and with the advice of its counsel and its independent consultants. The Parties further acknowledge this Agreement is fair and mutually beneficial to them because it fixes and maintains mutually acceptable, reasonable and accurate payments in lieu of taxes that are appropriate and serve their respective interests.

8. Additional Documentation and Actions. Each Party will, from time to time hereafter, execute and deliver or cause to be executed and delivered, such additional instruments, certificates and documents, and take all such actions, as the other Party reasonably requests for the purpose of implementing or effectuating the provisions of this Agreement and, upon the exercise by a Party of any power, right, privilege or remedy pursuant to this Agreement that requires any consent, approval, registration, qualification or authorization of any third party, each Party will execute and deliver all certifications, instruments and other documents that the exercising Party may be so required to obtain; provided in no event shall a Party be required to execute any instruments, certificates, or documents, or to take any actions, that would materially increase a Party’s obligations or materially decrease a Party’s rights under this Agreement or the DDA.

9. Invalidity. If, for any reason, it is ever determined by the State of California or the County of Solano or by any court of competent jurisdiction that any material provision of this Agreement is unlawful, invalid or unenforceable, then the Parties shall (i) undertake good faith diligent efforts to amend and or reauthorize this Agreement so as to render all material provisions lawful, valid and enforceable, and (ii) if such efforts are unsuccessful, undertake reasonable efforts, including without limitation, seeking all necessary approvals, to replicate the benefits and burdens of this Agreement in the form of an amended agreement.

10. Notices. All notices, consents, requests, or other communications provided for or permitted to be given hereunder by a Party must be in writing and will be deemed to have been properly given or served upon the personal delivery thereof, via courier delivery service or otherwise. Such notices shall be addressed or delivered to the Parties at their respective addresses shown below.

To Owner 1: The Nimitz Group, LLC
_______________________
_______________________
_______________________
Attn.: _________________
With a copy to: The Nimitz Group, LLC
c/o Southern Land Company
Attn.: Legal Department
3990 Hillsboro Pike, Ste. 400
Nashville, TN 37215
Email: [email protected]
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To Owner 2: _______________________
_______________________
_______________________
_______________________
Attn.: _________________
With a copy to: The Nimitz Group, LLC
c/o Southern Land Company
Attn.: Legal Department
3990 Hillsboro Pike, Ste. 400
Nashville, TN 37215
Email: [email protected]
To the City: City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Manager
Telephone: (707) 648-4576
With a copy to: City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Attorney
Telephone: (707) 648-4545
Delivery of the Payment to the City:

City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590
Attn: Economic Development Department
Telephone: (707) 649-5454
Delivery of the Payment to VCUSD:
_______________________
_______________________
_______________________
Attn: __________________
Telephone: (707) ___-_____
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Any such addresses for the giving of notices may be changed by either Party by giving written notice as provided above to the other Party. Notice given by counsel to a Party shall be effective as notice from such Party.

11. Representations of City. City represents and warrants to Owners (i) it has secured all approvals necessary to duly authorize the execution, delivery and performance of this Agreement and its obligations hereunder, and (ii) it is not prohibited from entering into this Agreement and discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement by the terms, conditions or provisions of any law, any order of any court or other agency or authority of government, or any agreement or instrument to which the City is a party or by which the City is bound, and (iii) this Agreement is a legal, valid and binding obligation of the City and is enforceable in accordance with its terms.

12. Representations and Covenants of Owners. Each Owner represents and warrants to City (i) it is duly organized and is authorized to conduct business in the State of __________, and (ii) it is authorized and has the power under the laws of the State of California to enter into this Agreement and the transactions contemplated hereby, and to perform and carry out all covenants and obligations on its part to be performed under and pursuant to this Agreement, and (iii) the performance of its obligations hereunder will not violate, result in a breach of, or constitute a default under, any agreement or instrument to which such Owner is a party or by which Owner is bound, and this Agreement is a legal, valid and binding obligation of such Owner enforceable in accordance with its terms. During the Term of this Agreement, the Owners will not voluntarily seek to invalidate this Agreement.

13. City’s Enforcement Rights; Mortgagee Protection. In the event that Owners or their respective successors or assigns shall fail to make any payment to City or VCUSD by the Due Date, the City shall have a lien on the Mare Island Property for the amount of such charges or costs, which lien shall be perfected by the recordation of a “Notice of Claim of Lien” against the Mare Island Property. Any lien in favor of the City created or claimed hereunder is expressly made subject and subordinate to any mortgage or deed of trust made in good faith and for value, recorded as of the date of the recordation of the Notice of Claim of Lien, and no such lien shall in any way defeat, invalidate, or impair the obligation or priority of any such mortgage or deed of trust. The City may also pursue any and all other remedies available in law or equity in the event of a breach of Owners’ obligations and covenants set forth herein.

14. Miscellaneous.
(a) Relationship. Nothing contained herein, shall be construed as creating a relationship of principal and agent, employer or employee, partnership, joint venture, or other relationship between City and Owners. (b) Attorneys’ Fees. If, by reason of any default on the part of any Party in the performance of its respective obligations hereunder, the non-defaulting Party employs one or more attorneys, the defaulting Party shall pay the non-defaulting Party’s reasonable costs, expenses, and attorneys’ fees reasonably expended or incurred by the non-defaulting Party in connection therewith, whether or not suit is instituted.

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(c) Non-Waiver. The failure of any Party to exercise any of its rights under this Agreement or to insist upon strict performance of any of the provisions of this Agreement shall not be construed as a waiver of any such right or of any subsequent default of the same or a similar nature.
(d) Severability. Invalidation of any one of the provisions of this Agreement shall in no way affect any other provision each of which shall remain in full force and effect.
(e) Entire Agreement. This Agreement, together with the DDA, is fully integrated and contains the entire agreement between the Parties as to the subject matter hereof. There are no representations, inducements or promises of any kind other than expressly stated herein. This Agreement may not be modified except by a writing signed by all Parties.
(f) Construction and Jurisdiction. This Agreement shall be governed by and construed under the laws of the State of California, without reference to choice of laws principles, and, unless otherwise required by applicable law, the Parties agree that any action brought by either Party under or in relation to this Agreement, including without limitation to interpret or enforce any provision of this Agreement, shall be brought in, and each Party agrees to and does hereby submit to the jurisdiction and venue of, any state court located in Solano County, California, or, if there is federal jurisdiction, the United States District Court (Northern District) San Francisco. This Agreement is deemed to be joint work product of the Parties, and shall not be construed against any particular Party as the drafter.
(g) Captions. The captions in this Agreement are for convenience and ease of reference only, and in no way define or limit the intent of this Agreement. (h) Incorporation of Recitals and Exhibit. The recitals of this Agreement and the attachments and exhibits hereto are hereby incorporated into the body of this Agreement as though fully set forth herein.
(i) Third Party Beneficiaries. VCUSD shall be third party beneficiary of this Agreement. Except as set forth in the preceding sentences, there are no third party beneficiaries of this Agreement, and no party other than VCUSD shall have any rights under this Agreement.
(j) Joint Obligation. The obligations hereunder imposed upon Owners shall be joint and several.
(k) Independent Representation. Each of the Parties to this Agreement is equally sophisticated. Each has conducted an independent investigation of all facts and circumstances they consider necessary or desirable. And each has consulted with its respective attorneys and advisors, to the extent it considers necessary or desirable, before entering into this Agreement.

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day and year first above written.

CITY:

City of Vallejo, a California municipal
corporation
By:__________________________________
____________, City Manager
[Signature must be notarized]
ATTEST:
_________________________________
Dawn G. Abrahamson, City Clerk
APPROVED AS TO FORM:
_________________________________
Veronica Nebb, City Attorney
OWNER 1:

THE NIMITZ GROUP, LLC, a California
limited liability company
By: ______________________________
[Signature must be notarized]
Print Name: ________________________
Its: _________________________
OWNER 2:
__________________________________
By: ______________________________
[Signature must be notarized]
Print Name: ________________________
Its: _________________________
OAK #4843-5079-9573 v18 Exhibit H - Attachment 1 Page 1 ATTACHMENT NO. 1

DIAGRAM DEPICTING

CITY-OWNED PROPERTY AND NAVY-OWNED PROPERTY
To be inserted
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LIST OF APNs AND 2021/22 AVs - SOUTH MARE ISLAND PROPERTY OAK #4843-5079-9573 v18 Exhibit H - Attachment 2 Page 2 OAK #4843-5079-9573 v18 Exhibit H - Attachment 3 Page 1 ATTACHMENT NO. 3
LEGAL DESCRIPTION – CITY-OWNED PROPERTY
To be inserted
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[NOTARY ACKNOWLEDGMENTS]
To be inserted
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Exhibit I
Exhibit I

DEPICTION OF SOUTH MARE ISLAND
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Exhibit J Page 1
Exhibit J

LEGAL DESCRIPTION OF SOUTH MARE ISLAND

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Exhibit J Page 3
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Exhibit J Page 4
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Exhibit J Page 5
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Exhibit J Page 6
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Exhibit J Page 7
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Exhibit K Page 1
Exhibit K

CERTIFICATE OF COMPLETION
Recording Requested By
And When Recorded Mail To:

City of Vallejo
P.O. Box 3068
555 Santa Clara Street
Vallejo, CA 94590
Attn: City Clerk
)
)
)
)
)
)
)
)
(Space Above This Line for Recorder’s Use Only)
[Exempt from recording fee per Gov. Code § 27383]

CERTIFICATE OF COMPLETION
THIS CERTIFICATE OF COMPLETION (“Certificate”) is made by the CITY OF VALLEJO, a California municipal corporation (“City”), in favor of __________________, a _________________________________ (“Developer”), as of the date set forth below. Certain terms used but not defined herein shall have the meaning provided in Section 101 of the Disposition and Development Agreement described in Recital A below.

RECITALS
A. City and Developer have entered into that certain Disposition and Development Agreement (“DDA”) dated _______________, 2022, concerning the purchase and sale of, and performance of planning and pre-development work with respect to, certain real property constituting of an approximately ________-acre portion of North Mare Island, as more fully described in Attachment No. 1 attached hereto and made a part hereof (the “Property”).