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INSURANCE 1O ON FILE
WORK MAY NnT PROCEED
CLERK OF COUNCIL
SECOND AMENDENT TO AGREEMENT DATE: S ro f 9
THIS AMENDMENT, made and entered into this 19'm day of April 1999, by and C
between the City of Santa Ana, a charter city and municipal corporation duly organized and
existing under the Constitution and laws of the State of California, hereinafter referred to as "City,"
and the Charles W. Bowers Museum Corporation, a California nonprofit public benefit corporation,
hereinafter referred to as "Corporation."
W-I-T-N-E-S-S-E-T-H
A. The Charles W. Bowers Museum is owned by City and managed and operated by
Corporation in accordance with the terms of a trust agreement executed by Charles W. and Ada
Bowers dated May 26, 1924 and that certain Agreement dated April 20, 1987, as amended by that
certain Amendment to Agreement dated April 5, 1993 (jointly, the "Management Agreement").
B. Pursuant to terms of the Management Agreement, the management fee to be paid
annually by the City to the Corporation is to be reduced on an annual basis with the goal of
reducing the fee to a minimal amount after ten (10) years (the "Annual Compensation
Adjustment").
C. The Corporation has requested that the Annual Compensation Adjustment be tolled
for a period of five (5) years to allow the Corporation to maintain the current level of programming
at the Museum and still achieve the goal of reduction of the management fee.
A-G-R-E-E-M-E-N-T
WHEREFORE, for and in consideration of their mutual and respective covenants and
promises hereinafter set forth, and subject to the terms and conditions of this Agreement, the parties
hereto do hereby agree as follows:
Amendment of Term of Management Agreement
Section 1.01 (1) of the Management Agreement is hereby amended to read as follows:
"(1) "Term" means a period of twenty-five (25) years from and after the
Commencement Date, and any extended term occurring by reason of Corporation's
exercise of an option to extend as herein provided."
2. Amendment to Compensation Formula
Section 4.07 of the Management Agreement is hereby amended in its entirety to read as
follows:
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"§4.07 Operational Cost Compensation
(a) In consideration of Corporation's services in operating the museum on the
Premises pursuant to this Agreement, City agrees to provide funding annually to
Corporation to assist in defraying Corporation's operational costs during the Term. The
amount of such funding shall be determined each fiscal year by the City Council in
accordance with the formulas set forth hereinbelow. During the first ten (10) fiscal years of
the Term (commencing with fiscal year 1987-88) such amount shall not be less than that
amount which, when added to the City's cost of providing City personnel pursuant to
sections 6.01 and 6.02, equals the amount of the approved budget for the "O.C. Bowers
Museum District" in the City's 1986-87 annual general fund budget as adjusted each fiscal
year by the Cost of Living Adjustment (the "Operational Cost Compensation"). During the
next fifteen (15) fiscal years of the Tenn, the Operational Cost Compensation shall be
equal to the Tenth Year Base Amount adjusted downward in each successive fiscal year by
ten percent (101/o) of the Tenth Year Base Amount (the "Annual Compensation
Adjustment"). Notwithstanding the foregoing, the Annual Compensation Adjustment shall
not be applied to the Operational Cost Compensation for the five (5) fiscal years 1999-2000
through 2003-2004, and instead the Operational Cost Compensation for those fiscal years
shall remain the same as the Operational Cost Compensation for Fiscal Year 1998-1999.
Thereafter, the Operational Cost Compensation shall continue to be reduced in accordance
with the Annual Compensation Adjustment.
(b) As used herein "Tenth Year Base Amount" means the minimum required
City funding in the tenth fiscal year of the Term. In each fiscal year, once the amount of the
Operational Cost Compensation has been determined by the City Council, it shall be paid
to Corporation in equal monthly installments, unless an alternative manner of payment is
mutually agreed upon by the City Manager and the Museum Director."
3. Effect of Amendment
Except as necessary to implement the intent of this Amendment, the Agreement shall
remain in full force and effect.
4. Non -waiver
Execution of this Amendment shall not be construed to act as a waiver by either party
hereto of any claims a party may have against the other, except to the extent directly affected by the
terms of this Amendment.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and year first above written.
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ATTEST:
a ice C. Guy
Clerk of the Council
C1999 Amentlmmt--Cle®n.tloc
3
CITY OF SANTA ANA
by
1r .
M or
proved as t tent
City Manager
CHARLES W. BOWERS MUSEUM
CORPO N
by 6w��O
Peter C. Keller, Ph.D.
President