THIS MEMORANDUM OF UNDERSTANDING ("MOU) is made and

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2 I COPY MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF LONG BEACH HARBOR DEPARTMENT AND THE CITY OF LOS ANGELES HARBOR DEPARTMENT REGARDING A PROPOSED ILWU HIRING FACILITY I I THIS MEMORANDUM OF UNDERSTANDING ("MOU) is made and 7 entered into, in duplicate, as of the Effective Date (as hereinafter defined), by and between the CITY OF LONG BEACH, a municipal corporation, acting by and through its Board of Harbor Commissioners ("POLB), pursuant to Ordinance No. HD, adopted by the Board of Harbor Commissioners of the City of Long Beach at its meeting of, 2007, and the CITY OF LOS ANGELES, a municipal corporation, acting by and through its Board of Harbor Commissioners ("POLA"). 1. Recitals. This MOU is made with reference to the following facts and objectives: 1.1 POLB and POLA (collectively, the "Ports") have tentatively selected a site for the future location of a new hiring facility for the International Longshore and Warehouse Union ("ILWU") to replace the ILWU's existing hiring facility. 1.2 The site which is currently under consideration by the Ports for the new hiring facility is a parcel owned by the City of Los Angeles (the "Anaheim Street Parcel") which is located in the Los Angeles Harbor District as further described in Section 3.1 of this MOU. 1.3 POLB and POLA wish to obtain and share equally the cost of appraisals of the Anaheim Street Parcel POLB and POLA further wish to describe the procedural steps by I which POLB may purchase from POLA, and POLA may sell and transfer to POLB, a 50% interest in the Anaheim Street Parcel if it is developed for the new hiring facility. 2. Effective Date. This MOU shall be effective upon the last date signed by the parties hereto (the L U ~ ~ L. W ~ ~ W P D ~ 124~ ~ I DOC W I ~ I MEMORANDUM OF UNDERSTANDlNGIIM)sfOlI ILWU PIS]

3 'Effective Date") and shall remain in effect for a period of three (3) years from the Effective Date, unless earlier terminated by the mutual consent of the parties hereto. 3. Avvraisal. 3.1 The Anaheim Street Parcel which is under consideration by the Ports for the new hiring facility is a 9-acre parcel owned by the City of Los Angeles and located at the southeast comer of Anaheim and Alameda Streets in the Los Angeles Harbor District, as shown on Exhibit "A" attached hereto and by this reference made a part hereof. 3.2 POLB previously has contracted with the fm of Riggs and Riggs, Inc. to provide ongoing appraisal services. POLA acknowledges that it is familiar with and approves of the firm of Riggs and Riggs, Inc. POLB has obtained an appraisal of the Anaheim Street Parcel, dated July 26, 2006 (the "July 26 Appraisal"), which has been prepared in accordance with the Uniform Standards of Professional Appraisal Practice. The July 26 Appraisal was completed for a fee of $3,750, and POLA hereby acknowledges receipt of a copy of the July 26 Appraisal. 3.3 POLA agrees to share equally (50%) the cost of the July 26 Appraisal with POLB, and POLA further agrees to share equally (50%) the cost of each additional appraisal ordered by the parties pursuant to Section 3.4 of this MOU. POLA agrees to reimburse POLB for POLA's share of the July 26 Appraisal cost within 30 days of the zarlier of (a) POLA's receipt of a billing invoice from POLB, and (b) the Effective Date of this MOU. With regard to all additional appraisals obtained pursuant to Section 3.4 of this "viou, POLA agrees to reimburse POLB for POLA's share of the cost of each such *dditional appraisal within 30 days of POLA's receipt of a billing invoice &om POLB for juch appraisal. 3.4 On a date mutually agreed by POLA and POLB, such parties shall ~btain a new appraisal of the Anaheim Street Parcel from Joyce Riggs, MAI, of the firm of iiggs and Riggs, Inc., or &om a similarly qualified appraiser (the "Appraiser"). If the :ffective date of such new appraisal is older than six months prior to the mutual execution )y POLA and POLB of a Purchase and Sale Agreement, if any, as hereinafter defined,

4 1 2 I I POLA and POLB shall, on a date mutually agreed by such parties, obtain a further new appraisal of the Anaheim Street Parcel from the Appraiser. Thereafter, POLA and POLB 3 shall, unless otherwise mutually agreed, continue to order successive new appraisals from 4 11 the Appraiser on a date or dates mutually agreed, if the effective date of the then most I I 5 recent appraisal obtained pursuant to this Section 3.4 is older than six months prior to the II 6 mutual execution by POLA and POLB of a definitive Purchase and Sale Agreement, if I I any. The cost of all appraisals obtained pursuant to this MOU shall be shared equally between the Ports as set forth in Section POLB and POLA agree that if the development of the Anaheim Street 10 Parcel for the new hiring facility proceeds, the appraised value reflected in the then most recent appraisal (as indicated by the effective date of such appraisal) obtained by the parties pursuant to this MOU shall be used to establish the base purchase price of the 50% interest referred to in Section 4 of this MOU, subject to any adjustments negotiated between POLB and POLA. 3.6 As used in Sections 3.4 and 3.5, "effective date" of an appraisal shall refer to the effective date, date of value or equivalent date indicated by the Appraiser on such appraisal. 4. Purchase and Sale of Interest in Anaheim Street Parcel. If the development of the Anaheim Street Parcel for the new hiring facility proceeds, POLB may purchase from POLA, and POLA may sell and transfer to POLB, a 50% interest in the Anaheim Street Parcel (the "50% Interest"). Such purchase and sale shall be conditioned upon and subject in all respects to the satisfaction of the following conditions prior to (or, in the case of the Purchase and Sale Agreement and the Lease, prior to or concurrently with) the purchase and sale of the 50% Interest: 4.1 Due Diligence. Review and approval by POLB in its sole discretion, of the Due Diligence Materials (as hereinafter defined). "Due Diligence Materials" refers 27 collectively to those materials set forth in clauses (a) through (g) below which POLB has, 28 in its sole discretion, requested that POLA provide or make available to POLB. POLA

5 $ $$ gggs 12,.- Y Fs$g 13-8% 4 14 :Is 0 15 GJJ %&tip 16 ~ p 2 3 op? 17 ~ 9 ~ 4 shall provide or make available to POLB all such Due Diligence Materials commensurate with the Effective Date (or as otherwise agreed by POLB). (a) insurance for the Anaheim Street Parcel; (b) A copy of POLA's most recent policy of title A current preliminary title report for the Anaheim Street Parcel, together with copies of all documents referred to in the report; (c) Copies of any and all existing and proposed easements, covenants, restrictions, agreements or other documents which affect title to the Anaheim Street Parcel and which are not disclosed by the preliminary title report; (d) Anaheim Street Parcel; The most current existing survey of the I (e) A detailed summary of any litigation, investigation or proceeding that is pending or threatened against the Anaheim Street Parcel, against POLA related to the Anaheim Street Parcel or being prosecuted by POLA with respect to the Anaheim Street Parcel (or, if none, written confirmation that there is none); (f) All reports in POLA's possession or control relating to the Anaheim Street Parcel, including but not limited to environmental reports, environmental audits, soils reports, site plans, engineering reports and plans, and other reports or documents of significance relating to the Anaheim Street Parcel; and (g) Any other information or documents reasonably requested by POLB relating to the Anaheim Street Parcel. 4.2 Purchase Price Adjustments. Mutual agreement by POLB and POLA on negotiated adjustments, if any, to the base purchase price of the 50% Interest described in Section 3.5 of this MOU.

6 4.3 Purchase/Sale Procedure. Satisfaction of the following procedural steps to enable POLB to purchase, and POLA to sell and transfer, the 50% Interest: (a) approval by the Board of Harbor Commissioners of the City of Los Angeles of the sale of the 50% Interest; (b) an ordinance passed by the City Council of the City of Los Angeles in accordance with such City's Charter, approving, if it deems appropriate, the sale of the 50% Interest; (c) an ordinance passed by the Board of Harbor Commissioners of the City of Long Beach in accordance with such City's Charter, approving, if it deems appropriate, the purchase of the 50% Interest. I9 I( II agreements: 4.4 Definitive Agreements. Complete execution of the following (a) a definitive purchase and sale agreement ("Purchase and Sale Agreement") satisfactory in form and substance to POLA and POLB with regard to the purchase and sale of the 50% Interest; and (b) a defitive lease of the Anaheim Street Parcel ("Lease") by the Ports to the Pacific Maritime Association andor ILWU satisfactory in form and substance to such parties. 4.5 CEQA Compliance. Completion andor satisfaction of all applicable requirements under the California Environmental Quality Act (Public Resources Code Sections et seq.). 4.6 Other Conditions. Satisfaction of such other conditions as POLB and POLA may agree upon. 5. Miscellaneous. 5.1 Notices. Any notices to be given under this MOU shall be given in 28 writing. Such notices may be served by personal delivery, facsimile transmission or by L UpprrClyt.xlX$$V%&GQIlW&WI12426 WC MEMORANDUM OFUNDWSTANDIffilllVDMll m.olnl ILWU ITS]

7 first class regular mail, postage prepaid. Any such notice, when served by mail, shall be effective two (2) calendar days after the date of mailing of the same, and when served by facsimile transmission or personal delivery shall be effective upon receipt. For the purposes hereof, notices to the City of Long Beach and the City of Los Angeles shall be )I directed as follows: If to the Citv of Lone Beach. to: Executive Director Long Beach Harbor Department P.O. Box 570 Long Beach, California FAX number: (562) If to the Citv of Los Anpeles, to: Executive Director Port of Los Angeles 425 South Palos Verdes Street San Pedro, California FAX number: (3 10) II 5.2 Amendment. The terms and provisions of this MOU may not be amended, modified or waived, except by an instrument in writing signed by both POLB and POLA. 5.3 Entire MOU. This MOU, including all exhibits attached hereto, 11 constitutes the entire agreement of POLB and POLA with respect to the subject matter hereof and supersedes all prior or contemporaneous agreements, whether written or oral. with respect thereto. 5.4 Counterparts. This MOU may be executed in any number of 1) counterparts, each of which shall be an original, but all of which taken together shall constitute but one and the same instrument, provided, however, that such counterparts shall have been delivered to both POLB and POLA. 5.5 Limited Binding Effect; Further Agreements. This MOU shall be binding on POLB and POLA solely with respect to the sharing of costs of the July 26 Appraisal and the additional appraisals as set forth in Section 3 of this MOU. Nothing L UppKtyL.u32\WPD~\WI2WM5Wl1426DOC MEMORANDUM OF UNDERSTANDING IIWO7]

8 herein shall bind either POLA to sell, or POLB to purchase, the 50% Interest. If, however, POLB and POLA proceed with the purchase and sale of the 50% Interest, the parties contemplate that there may be additional discussions andlor documents prepared and executed to address details concerning the purchase and sale of the 50% Interest, the lease of the Anaheim Street Parcel and related matters which are not covered in this MOU. If such is the case, POLB and POLA agree to negotiate in good faith with regard to such additional details and documents, if any. N N // /I N /I N 11 /I N

9 IN WITNESS WHEREOF, the parties hereto have executed this MOU on 2 11 the date to the left of their signatures. THE CITY OF LOS ANGELES, a municipal corporation, acting by and through its Board of Harbor Commissioners,2007 By: Dr. Geraldine Knatz Executive Director FOR POLA: APPROVED AS TO FORM: ROCKARD J. DELGADILLO Los Angeles City Attorney,2007 By: Joy Crose Assistant General Counsel THE CITY OF LONG BEACH, a municipal corporation, acting by and through its Board of Harbor Commissioners 7 0 2, By: Richard D. Steinke Executive Director FOR POLB: APPROVED AS TO FORM: ROBERT E. SHANNON Long Beach City Attorney,2007 By: Tiffani L. Shin Deputy City Attorney L ~ M t ). L. W 1 2 \ W ~ ~ 1 ~ 1 1WE MEMORANDUM OF UNDWTANDINt IIPI(IMnl 8

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11 ORDER NO. IT IS HEREBY ORDERED by the Board of Harbor Commissioners that the MEMORANDUM OF UNDERSTANDING granted by the City of Los Angeles, acting by and through its Board of Harbor Commissioners, between the PORT OF LOS ANGELES and the PORT OF LONG BEACH regarding the proposed International Longshore and Warehouse Union King facility is hereby approved and the Executive Director and the Secretary of the Board are hereby authorized and directed to execute and attest to the same on behalf of the City of Los Angeles. The Secretary shall certify to the adoption of this Order by the Board of Harbor Commissioners of the City of Los Angeles. This Order shall become effective immediately upon its certification by the Board Secretary and the noted MEMORANDUM OF UNDERSTANDING shall become effective immediately upon due execution by all parties, without publication of the Order. I HEREBY CERTIFY that the foregoing Order was adopted by the Board of Harbor Commissioners of the City of Los Angeles at its meeting of APPROVED AS TO FORM ocfv~r.r~, 17,2007 ROCKARD J. DELGADILLO, City Attorney ROSE M. DWORSHAK Board Secretary By: BL239smd Order