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and devices of whatsoever nature incorporated in, or attached to the work, or otherwise delivered to City as <br />a part of the work pursuant to the Agreement, to be free of all defects of workmanship and materials for a <br />period of one year after initial acceptance of the entire work by City. Owner shall repair or replace any or <br />all such work or material, together with all or any other work or materials which may be displaced or <br />damaged in so doing, that may prove defective in workmanship or material within said one year guarantee <br />period without expense or charge of any nature whatsoever to City. Owner further covenants and agrees <br />that when defects in design, workmanship and materials actually appear during the guarantee period, and <br />have been corrected, the guarantee period shall automatically be extended for an additional year to insure <br />that such defects have actually been corrected. <br />In the event the Owner shall fail to comply with the conditions of the foregoing guarantee within <br />thirty (30) days time, after being notified of the defect in writing, City shall have the right, but shall not be <br />obligated, to repair or obtain the repair of the defect, and Owner shall pay to City on demand all costs and <br />expense of such repair. Notwithstanding anything herein to the contrary, in the event that any defect in <br />workmanship or material covered by the foregoing guarantee results in a condition which constitutes an <br />immediate hazard to the public health, safety, or welfare, City shall have the right to immediately repair, or <br />cause to be repaired, such defect, and Owner shall pay to City on demand all costs and expense of such <br />repair. The foregoing statement relating to hazards to health and safety shall be deemed to include either <br />temporary or permanent repairs which may be required as determined in the sole discretion and judgment of <br />City. <br />If City, at its sole option, makes or causes to be made the necessary repairs or replacements or <br />performs the necessary work, Owner shall pay, in addition to actual costs and expenses of such repair or <br />work, fifty percent (50 %) of such costs and expenses for overhead and interest at the maximum rate of <br />interest permitted by law accruing thirty (30) days from the date of billing for such work or repairs. <br />STANDARD PUBLIC IMPROVEMENT AGREEMENT Page 10 of 13 <br />G:\ Blvd 1701 (Kaiser) \Off site improvement plans\Public Improvement Agreement 2500 Merced.doc <br />