SUMMARY OF POTENTIAL RISKS OF LIABILITY ASSOCIATED WITH NATURALLY OCCURRING ASBESTOS

The presence of naturally occurring asbestos ("NOA") gives rise to complex regulatory requirements and concerns regarding liability to government agencies, third parties, employees and contractors. In addition to the large number of local, state and federal regulations pertaining to development requirements in areas with potential NOA, NOA is classified as a Hazardous Substance under the Federal Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), the Hazardous Substance Account Act, and Chapter 6.8 of the California Health and Safety Code. This classification allows regulatory agencies to require response actions and can subject responsible parties to joint and several liability. Further, notices must be provided to potentially exposed parties, including employees, contractors and prospective purchasers or tenants. To minimize potential exposure to liability, risk management procedures and recordkeeping practices which document compliance with applicable requirements should be implemented.