Exhibit 10.32


 


CONSTRUCTION AGREEMENT


 


BETWEEN OWNER,
ARCHITECT, AND HBE FINANCIAL FACILITIES, A DIVISION OF HBE CORPORATION.  This Agreement sets forth a Contract made
this 12th day of February, 2003 between Heritage Oaks Bank, 545 12th
Street, Paso Robles, California 93446 (hereinafter referred to as “Owner”) and
HBE Financial Facilities, a Division of HBE Corporation, a Delaware Corporation
having its principal place of business at 11330 Olive Boulevard, St. Louis,
Missouri, 63141 (hereinafter referred to as “HBE”), and Frederick S. Scott, and
Ronald L. Hollander (hereinafter referred to as “Architect”).


 


The parties hereto agree as follows:


 


A.                                   CONTRACT DOCUMENTS.
The Contract between the parties consists of: 
this Agreement, the General Conditions of the Contract for Construction,
Special Conditions of the Contract for Construction, the Drawings and
Specifications enumerated in Paragraph F hereof, and all Modifications issued
pursuant to the General Conditions.  These
form the Contract and all are as fully a part of the Contract as if attached to
this Agreement or repeated herein.


 


B.                                     THE WORK.  HBE shall perform all the Work required by
the Contract for A New Building for Heritage Oaks Bank, Paso Robles,
California.


 


C.                                     CONTRACT
TIME.  The  Work to  be performed  under 
this  Contract  shall  
commenced  on  April 14, 2003 or upon issuance of all
necessary construction permits, which ever is later and completed 35 weeks
after commencement provided the Owner has executed and returned the Contract by
the date first written above.


 


D.                                    PAYMENTS.  The Owner shall pay to HBE the Contract Sum
of:  $1,855,000.00 One million eight
hundred fifty five thousand and 00/100 dollars, subject to adjustment by Change
Order as provided in the Contract.


 


Based upon Applications for Payment submitted to the Architect by HBE
and Certificates for Payment issued by the Architect, and approved by the
Owner, the Owner shall make progress payments on account of the Contract Sum to
HBE as follows:


 


1.               Upon execution of the Construction
Agreement, 8% of the Contract Sum less previous payments.  The payment and all future payments under
this Agreement will be made by wire transfer of funds to US  Bank, St. Louis, Missouri for account of HBE
Corporation.


 


2.               Until the Work is 50% complete, on or
before the 10th day of each month, 90% of the portion of the Contract Sum
properly allocable to labor, materials, and equipment incorporated in the Work
and 90% of the portion of the Contract Sum properly allocable to materials and
equipment suitably stored at the site or at some other location agreed upon in
writing by the Owner and HBE, up to the first day of that month, less the
aggregate of previous payments.


 

















 


3.               After the Work is 50% complete and
before Substantial Completion, on or before the 10th day of each month 100% of
the portion of the Contract Sum properly allocable to labor, materials, and
equipment incorporated in the Work, and 100% of the portion of the Contract Sum
properly allocable to materials and equipment suitably stored at the site or at
some other location agreed upon in writing by the Owner and HBE up to the first
day of that month, less the aggregate of previous payments and retainage.


4.               On or before the 10th day of the month
after Substantial Completion of, or occupancy by the Owner of, any designated
portion of the Work, the retainage applicable to that portion of the Work, less
such amounts as the Architect shall determine to be required for completion of
and less such amounts for unsettled claims relating to that portion of the Work
shall be due and payable; for purposes of this paragraph, a separate portion of
the Work is any area that is or can be occupied by the Owner prior to
Substantial Completion of all the Work.


5.               Upon Substantial Completion of the Work,
or occupancy by the Owner, a sum sufficient to increase the total payments to
the Contract Sum, less such retainage as the Architect and Owner shall
determine for all incomplete Work and unsettled claims.


6.               Final payment, constituting the entire
unpaid balance of the Contract Sum, shall be paid by the Owner to HBE 30 days
after Substantial Completion provided the Work has been completed, the Contract
fully performed, and a final Certificate for Payment has been issued by the
Architect, and approved by the Owner.


 


The Owner has no liability to the Architect for his compensation, it
being understood that compensation for architectural services is included in
the Contract Sum payable to HBE.


 


E.                 DEFINITIONS.  The terms used in this Agreement which are
in the General Conditions of the Contract for Construction shall have the
meanings designated in those Conditions.


 


F.                 ENUMERATIONS OF
DRAWINGS, SPECIFICATIONS & DOCUMENTS.


 


The following documents developed under Phase
III of the Letter Agreement dated May 31, 2002 between the Owner and HBE
are (except for Modifications issued after the execution of this Agreement) the
Contract Drawings, Specifications and Documents:


 


Construction Agreement dated February 12,
2003.


General Conditions


Special Conditions


Specifications Part I including Divisions 2
through 11, Divisions 15 and 16, and Part II Interior Work Divisions 6, 9 and
12 all dated February 12, 2003. 
Drawings TS, CF.1, C1.1, C1.2, C1.3, C2.1, C2.2, A2.1, A2.2, A3.1, A4.1,
A5.1, A5.2, A5.3, A6.1, A7.1, IW1.1, IW2.1, IW2.2, S1.1, S2.1, S3.1, S3.2,
S4.1, M1.1, PFP1.0, PFP2.0, E1.1, E2.1, E3.1, E4.1, E4.2, E4.3, and E5.1, all
by Frederick S. Scott, Architect, all dated February 12, 2003.


 


When the working drawings and specifications
to be developed under Phase IV of the above Letter Agreement are completed and
are approved by the Owner, they will become the Contract Drawings and
Specifications.


 


G.                ARCHITECT.  The Architect will provide general
administration of the Contract per Article 2 of the General Conditions; however,
decisions rendered by the Architect in the performance of these duties will not
be binding upon the Owner.


 


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H.               CONTRACT TIME AND
CONTRACT SUM.  The Contract Time and
Contract Sum are based upon this Agreement being signed by the Owner by
February 12, 2003.


 


I.                    GOVERNING
CODE.  The governing code officials have
not completed their review of the Contract Drawings and Specifications at the
time of Contract signing, and any changes required for their final approvals
will be incorporated into the Contract by a modification issued pursuant to the
General Conditions.


 


J.                   ADDITIONAL
SERVICES OF THE ARCHITECT.  Preparing
drawings, specifications, estimates, and other supporting data for proposed
Changes in the Work requested by the Owner shall be considered Additional
Services and reimbursed to HBE at HBE’s published rates.  Such Additional Services shall be added to
the Contract by Change Order as defined in Article 12 of the General
Conditions.  The additional work will be
performed at the following rates:


 


	
  Principal

  	
   

  	
  $250.00/Hour

  	
   

  
	
  Arch. Engineer of Record

  	
   

  	
  160.00/Hour

  	
   

  
	
  Design Arch./Engr./APM

  	
   

  	
  130.00/Hour

  	
   

  
	
  Staff Arch./Engr./Interior Designer

  	
   

  	
  90.00/Hour

  	
   

  
	
  Draftsman/Clerical

  	
   

  	
  55.00/Hour

  	
   

  



 


K.               AMERICANS WITH
DISABILITIES ACT (ADA). The Department of Justice issued its final rule and
Accessibility Guidelines for Building and Facilities on July 26, 1991
implementing Title III of the ADA with regard to public accommodation and
commercial facility requirements for new construction. At present, there is no
reviewing authority established to review the Contract Documents with regard to
their specific compliance with Title III of the ADA. HBE has attempted in good
faith, when questions of interpretation have arisen, to include in the Contract
Documents the requirements of Title III of the ADA. Should an interpretation be
issued after contract execution and during construction by agencies having
jurisdiction over compliance which would require a change to the Contract
Documents, then any such change, if acceptable to all parties, shall be
incorporated into the Contract Documents by a modification issued pursuant to
the General Conditions.


 


L.                 PRIORITY OF
CONTRACT DOCUMENTS.  The Contract
Documents are intended to complement and supplement each other, however, when
the General Conditions of the Contract grant authority to the Architect to make
decisions, such decisions shall be specifically subject to Paragraph G. of this
Construction Agreement, and, in general, to the extent there are any other
conflicts between the various Contract Documents, as between Owner and HBE, the
following relative order shall apply:


 


1.            This Construction Agreement


2.            Special Conditions


3.            General Conditions


4.            Drawings and Specifications


 


M.            The site engineering
plans and information have been developed by North Coast Engineering under a
seperate contract with the Owner.  HBE
has relied on the accuracy of the plans and information developed by North Coast
Engineering. In the event of any errors or omissions in such plans and/or
information, the Owner agrees to protect and hold harmless HBE from any costs,
expenses or liability resulting from such errors or omissions, and to defend
and indemnify HBE from any expenses, including attorney’s fees, resulting
therefrom.


 


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N.               DISPUTE
RESOLUTION.  Owner and HBE agree that if
there is a dispute between them, that each will negotiate with the other in
good faith to attempt to resolve the dispute, and that as long as these
negotiations continue, each party will continue to perform its obligations
under this contract until either party gives the other party ten (10) days
prior written notice that the dispute cannot be resolved by further
negotiations and that said party will, after such ten (10) day notice, proceed
to exercise any and all rights of his under this contract.  In the event of litigation between the
parties, the parties agree that the venue for such litigation shall be the
state or federal courts within the State of California, and each party
expressly consents to the exercise of personal jurisdiction therein.  The prevailing party to any such litigation
shall be entitled to recover its reasonable costs and attorney’s fees incurred
in such litigation.


 


This Agreement executed the day and year first above written.


 


	
   

  	
   

  	
   

  	
  HERITAGE OAKS BANK

  PASO ROBLES, CALIFORNIA

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  OWNER: BY

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  TITLE

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  CONTRACTOR:

  	
   

  	
   

  	
  HBE  FINANCIAL  FACILITIES

  A  DIVISION  OF  HBE  CORPORATION

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  BY

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Fred S. Kummer

  
	
   

  	
   

  	
   

  	
   

  	
  President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARCHITECT:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Frederick S. Scott

  
	
   

  	
   

  	
  Architect

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HBE CONTRACTOR NUMBER

  	
   

  	
  California Contractor

  
	
   

  	
   

  	
   

  	
   

  	
  License No. 283655

  
										



 


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