BOWERS MUSEUM - 2001 AMENDED & OPERATING AGMT

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r 9 q-2001-129 AMENDED AND RESTATED OPERATING AGREEMENT _..__..".,._30 _'_-zao? THIS AGREEMENT, made and entered into this 18th day of June, 2001, by and b tween 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." RECITALS A. The Charles W. Bowers Memorial Museum (the "Museum") is owned by the City and operated by the Corporation in accordance with the terms of this Agreement and a conveyance in trust by the late Charles W. Bowers and his wife Ada Bowers (the "Bowers Trust"). The Museum is composed of several buildings and other improvements located at 2002 North Main Street (the "Premises"). Under separate agreements, the Corporation leases a parking lot from the Santa Ana Community Redevelopment Agency immediately south of the Premises as well as a childrens' museum adjacent thereto. B. The Corporation is a non-profit public benefit corporation organized and existing under the laws of the State of California for the purpose of managing and operating the Museum. C. The City and the Corporation entered into that certain Agreement dated April 20, 1987 for the purpose of establishing a program whereby the Corporation would undertake full operation and maintenance of the Museum on behalf of the City for a period of twenty years. The Agreement was amended in 1993, among other things, to grant the Corporation the option to extend the term of Operating Agreement. The Agreement was also amended in 1999 to extend the term five years and to modify the terms of the City operating assistance. The Agreement as amended in 1993 and 1999 shall hereafter be referred to as the 1987 Operating Agreement. D. Under the terms of the 1987 Operating Agreement, the Corporation agreed to be fully responsible for the cost of both operating the Museum and maintaining the Premises. In exchange for the license to operate and maintain the Museum, the City agreed to provide operating assistance, which would increase in accordance with the cost of living for the first ten years, and then decline to zero over the second ten years. The 1999 amendment caused the operating assistance to be stabilized for a period of five additional years before beginning to decline. E. The City and the Corporation have now determined that it is not economically feasible for the Corporation to operate the Museum at a mutually acceptable level of programming and maintain the Premises appropriately without permanent economic participation by the City. F. The Corporation also leases or licenses three other facilities from the Community Redevelopment Agency of the City of Santa Ana which are part of the overall operations of the