Environmental Risk Management Program May 19, 2005

Contractor’s Pollution Legal Liability (CPL) Coverage Covers Third Party Bodily Injury, Property Damage, Cleanup Costs, and Defense Costs Due To the Performance of“Covered Operations.” Includes Primary and Contingent Transportation and Disposal Sites Policy Features Not Found in PLL include: Occurrence- Based Coverage; Completed Operations, Third Party Action Over Coverage Occurrence Based Trigger

Contractor’s Pollution Legal Liability (CPL) Exclusions Intentional and Willful Noncompliance of Any Statute, Regulation, etc. Any Claim Based Upon Pollution Conditions Existing Prior to the Inception Date, or Any Condition that Could Have Been Reasonably Foreseen that could Give Rise to a Claim, for which the Insured Had Knowledge Products Liability Criminal Fines and Penalties Workers’ Compensation/Employer’s Liability War, Riots, Civil Commotion, Strikes, etc. Professional Liability, Except for Supervision of Subcontractors Nuclear Exclusion Pollution Releases Not Related to Specific Contractor Activities

Contractor’s Pollution Liability LAUSD + Contractors and Environmental Contractors as Insureds, Contingent Incidental (Excess/DIC) Liability Created from Activities of the Environmental Contractors 7 Year Term $50,000,000 in Limits $100,000 Deductible – $1,000,000 Aggregate – $20,000 Maintenance Deductible

Pollution Legal Liability Coverage On-Site Cleanup of Pre-Existing Conditions On-Site Cleanup of New Conditions Third Party Claims for On-Site Bodily Injury and Property Damage Third Party Claims for Off-Site Cleanup Resulting from Pre- Existing Conditions Third Party Claims for Off-Site Cleanup Resulting from New Conditions

Pollution Legal Liability Coverage Third Party Claims for Off-Site Bodily Injury and Property Damage Third Party Claims for On-Site Cleanup Costs -Non-Owned Locations Third Party Claims for Off-Site Bodily Injury, Property Damage and Cleanup Costs - Non-Owned Locations Pollution Conditions Resulting from Transported Cargo Additional Locations To Be Acquired. Will be Scheduled After Remediation

Pollution Legal Liability Exclusions Belmont, Until Remediated Known Underground Storage Tanks, Not Otherwise Approved and Scheduled Asbestos and Lead, Exceptions Made On A Site-by-Site Basis, After Abatement Contractual Liability, Except for those Contracts Scheduled Y2K Computer-Related Claims Criminal Fines and Penalties Pollution Conditions Beginning After a Property is Abandoned

Pollution Legal Liability Limits of Liability – $50,000,000 Each Incident – $100,000,000 Aggregate 20 Year Policy Term $25,000 Maintenance Deductible

Environmental Claims Procedures Provide AIG with all necessary information and documentation Advise AIG before retaining an environmental contractor Cooperate with AIG on claim investigation and defense Notify AIG of any planned expenditures

Contact Steven Miller, Sensus Consulting Inc., Ventura Blvd., Suite 1214, Encino CA