AC34 Host and Venue Agreement

November 10, 2010

Here is the entire text of the document released by San Francisco on Tuesday:

34TH AMERICA’S CUP HOST CITY AND VENUE AGREEMENT

This 34th America’s Cup Host City and Venue Agreement (“Agreement”), dated November 9, 2010, is entered into by and among the City and County of San Francisco, a municipal corporation (the “City”), the San Francisco America’s Cup Organizing Committee, a corporation organized under the California Public Benefit  Non-Profit Corporation Law (“the Committee”), and the America’s Cup Event Authority, LLC, a limited liability company organized under the laws of California (the “Authority”).  The City, the Committee and the Authority are collectively referred to as the "Parties" and individually as a "Party."

RECITALS

A. The competition for the America’s Cup, first held in 1851 at Cowes, England, is one of the oldest international sporting competitions and the world’s premier yacht racing event.  The Golden Gate Yacht Club of San Francisco (“GGYC”) won the 33rd America’s Cup match in Valencia, Spain on February 14, 2010 and is now trustee under the Deed of Gift dated October 24, 1887, between George L. Schuyler and the New York Yacht Club, as amended by final decisions of the Supreme Court of the State of New York (the “Deed of Gift”), governing the silver cup won by the yacht America in the first America’s Cup competition.  Under the Deed of Gift, GGYC is entrusted with the organization of the 34th America’s Cup (“AC34” or the “Event”).

B. GGYC has received and accepted the challenge of Club Nautico di Roma of Rome, Italy (“CNR”), and GGYC and CNR entered into The Protocol Governing AC 34, dated September 9, 2010 and executed September 13, 2010 (together with all attachments, schedules and appendices to thereto, and any amendment or any replacement protocol that governs AC 34, the “Protocol”).

C. GGYC and CNR have appointed the Authority, per Article 4 of the Protocol,  to organize and manage AC34, in association with America’s Cup Race Management (“ACRM”).  GGYC intends to select a venue for AC34 on or before December 31, 2010 and has authorized the Authority and ACRM to assist it to receive proposals and negotiate terms with prospective interested venues as part of the selection process.

D. The City wishes to host AC34 including certain of the America’s Cup World Series Pre-regattas, the America’s Cup Challenger Series, the America’s Cup Defender Series (if held) and the Match.  The Committee has been organized and exists for public and charitable purposes to foster national and international amateur sports competition in accordance with Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, and particularly to assist in securing and conducting AC34 in San Francisco, California and intends to qualify as such a tax-exempt organization. The Committee wishes to support and facilitate the City’s hosting of AC34, including through assisting in the procurement of sponsorship funding, posting of the Bond (as defined below) and performance of the Committee’s other obligations under this Agreement.

E. The Authority, the City and the Committee intend that, if San Francisco is selected as host city for AC34, the Event will be organized in a manner, and take place under conditions, that maximize the sporting, social and economic benefits to all concerned, using technology and facilities of an appropriately high standard to ensure the fullest coverage by different media and the widest possible audience for the Event, and emphasizing resource sustainability and environmental stewardship in the staging of the Event.

F. The Authority will receive proposals from other cities to host AC34.  The choice of the host city will be made by GGYC, in its sole discretion.

G. The parties acknowledge that the City's approval of the Event is subject to environmental review required by the California Environmental Quality Act ("CEQA"), and the reservation of discretion that is required in connection with that review, as further described in Section 2.1.  This Agreement establishes the framework for a transaction structure under which the City will act as the host city for the Event (if selected) and commitments of the parties both before and after such selection, and (should it occur) commitments of the parties after certification of the environmental analysis under CEQA.

H. The transaction framework may be summarized as follows: (1) subject to CEQA review and the reservation of discretion as provided in Section 2.1, the City, through its Port, will enter into Venue Leases (or licenses in certain instances) with the Authority for those facilities the Authority requires to stage the Event in the City (the “Venues”), as identified in the final Event Plan, and the term of each Venue Leases will continue for a specified period after the end of the Event, and the Authority may extend that term if the GGYC is successful in its defense of the America’s Cup; (2) after expiration of the Venue Leases, in consideration of the Authority's investment in infrastructure required for the Event, the Authority will have long term development rights as to three of the Venues, pursuant to Disposition and Development Agreements (the “DDAs”), which will provide for the execution and delivery Legacy Leases and a Transfer Agreement on the satisfaction of certain conditions; (3) the execution of the Venue Leases (and licenses), delivery of possession of the sites subject to those leases and licenses, and the execution of the DDAs, would all occur simultaneously, promptly following the completion of environmental review for the Event under CEQA; and (4) the Authority does not have plans for development of any of the Venues that will be subject to the DDAs, and particular plans for development of those Venues after AC34 will be subject to such further environmental review as CEQA may require.

I. Because plans for AC34 have not been finalized, the parties anticipate certain changes may be made by mutual agreement between the date of this Agreement and the execution of the Venue Leases, the DDAs for the Legacy Leases and/or the Transfer Agreement.  Accordingly, this Agreement provides flexibility to allow such changes without compromising the essential benefits of their bargain. 
J. San Francisco leads the way on environmental policies and sustainability initiatives that grow the City's economy and protect the health of the City's communities.  The Parties are committed to minimizing the environmental impact of hosting the America's Cup, with the goal of offering residents and visitors a truly sustainable event while raising the bar for future America's Cup host cities to implement environmental plans that will manage impacts associated with preparing for and presenting the regatta.  The Authority, the City and the Committee intend that, if San Francisco is selected as host city for AC34, the Event will be a carbon neutral and zero waste operation and will emphasize resource sustainability and environmental stewardship.  As appropriate, the Authority will endeavor to meet or exceed LEED or LEED-equivalent ratings pursuant to Chapter 13C of the San Francisco Building Code for permanent Event buildings.

K. San Francisco is proud of its diverse and productive workforce and believes that employers benefit from the innovative, skilled and talented human capital that calls San Francisco home.  To support local hiring in the City of San Francisco, the Authority will participate in the San Francisco Workforce Development System and comply with mandatory local hiring program regulations pursuant to Chapter 6.22 and Chapter 83 of the San Francisco Administrative Code or successor laws or policies.

L. Small businesses are a critical component of the San Francisco economy.  Fostering entrepreneurship and supporting small business growth contributes to the City's tax base and creates local jobs.  The Authority, the City and the Committee intend that, if San Francisco is selected as host city for AC34, the Event will be organized in a manner that supports San Francisco's small businesses and incorporates local restaurants, retailers, building suppliers and local manufacturers.

M. The City is committed to ensuring that San Francisco's young people have the widest opportunities to learn, gain valuable experience and enjoy their City.  The Authority, the City and the Committee intend that, if San Francisco is selected as host city for AC34, the Event will incorporate and support sailing related programs and activities for the City's children, youth and families.  Preceding and during the Event:  The Authority will conduct extensive outreach to children, youth, and families, conduct youth sailing courses, and provide event passes to San Francisco's children, youth and families at no cost.  The Authority will commit to hiring young people to work at these events or to provide them with an internship.  The Authority will create friendly open spaces in which children and youth will engage in various Event related activities.  The Authority will create exciting learning spaces in which children, youth and families will have access to experiential and project-based learning related to the Event.