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SAN )SE NATIONAL BANK ABA 1211 3921 6 0152871811 ESCROW AGREEMENT FOR SECURITY DEPOSITS IN LIEU OF RETENTION This Escrow Agreement is made and entered into by and between City of Redwood City hereinafter called "Owner", whose address is Post Office Box 391 Redwood City. CA 94064. M.c.H. General Engineering Contractors. Inc. hereinafter called "Contractor", whose address is 1817 Stone Avenue. San Jose. CA. 95125: and San Jose National Bank, hereinafter called "Escrow Agent", whose address is One North Market Street. San Jose. CA. 95113 For the consideration hereinafter set forth, the Owner, Contractor, and Escrow Agent agree as follows: 1. Pursuant to Section 22300 of the Public Contract Code of the State of California, Contractor has the option to deposit securities which meet the requirements set forth in said section 22300, with Escrow Agent, as a substitute for retention earnings required to be withheld by Owner pursuant to the Construction Contract entered into between Owner and Contractor for: "2000-2001 Bike Path Improvements" in the amount of: $204.258..00 dated 4/23/01 (hereinafter referred to as the "Contract"). Alternatively, on written request of the Contractor, the Owner shall make payments of the retention earnings directly to the Escrow Agent. When Contractor deposits the securities as a substitute for Contract earnings, the Escrow Agent shall notify the Owner within 10 days of the deposit. The market value of the securities at the time of the substitution shall be at least equal to the cash amount then required to be withheld as retention under the terms of the Contract between the Owner and Contractor. Securities shall be held in the name of City of Redwood City and shall designate the Contractor as the beneficial Owner. 2. The Owner shall make progress payments to the Contractor for those funds which otherwise would be withheld from progress payments pursuant to the contract provisions, provided that the Escrow Agent holds securities in the form and amount specified above. 3. When the Owner makes payment of retention earned directly to the Escrow Agent, the Escrow Agent shall hold them for the benefit of the Contractor until the time that the escrow created under this contract is terminated. The Contractor may direct the investment of the payments into securities. All terms and conditions of this agreement and the rights and responsibilities of the parties shall be equally applicable and binding when the Owner pays the Escrow Agent directly. 4. Contractor shall be responsible for paying all fees for the expenses incurred by Escrow Agent in administering the Escrow Account and all expenses of the Owner. These expenses and payment shall be determined by the Owner, Contractor, and Escrow Agent. T-a