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HomeMy WebLinkAboutMUTUAL RELEASES STATE OF CA/ATTRANSCO, INC. - 1999-08-3042 •� ;�� 11 Rill - y-. ATTORNEYS 'ATE LAW PROCTORS IN ADMIRALTY May 22, 2000 LAW OFFICES ,DAMES H. ACKERMAN ONE WORLD TRADE CENTER SUITE 1440 LONG BEACH, CALIFORNIA 90831-1440 (562) 432-0909 (562) 436-9911 Paul D'Alessandro, Esq. Office of the City Attorney City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648 Re: Oil Spill Settlement Mutual General Ile+ease_- State of California, et at./Attransco_ Inc. Dear Paul: Enclosed is the SETTLEMENT AGREEMENT WITH MUTUAL GENERAL RELEASES entered into between the parties in this matter. Please let me know if you have any questions. Regards, iAM:E'S H. ACKERMAN JI-IA:sm Enclosure CABLE ADDRESS: 'AMACK' TELECOPIER (562) 436-1897 • SETTLEMENT AGREEMENT WITH MUTUAL GENERAL RELEASES This Settlement Agreement with Mutual General Releases (tile "Agreement") is entered into by and between the People of the State of California ex rel. Department of Fish and Game, Department of Parks and Recreation, California Regional Water Quality Control Board, Santa Ana Region, and State Lands Commission; the City of Huntington Beach, a municipal corporation and charter city; the City of Newport Beach, a municipal corporation and charter city; and the County of Orange, a political subdivision of the State of California (collectively "Plaintiffs"), on the one hand, and American Trading Transportation Co., Inc., Attransco, Inc., and their insurers (hereinafter collectively referred to as "Attransco"), on the other hand. I. RECITALS A. Description of the Oil Spill On February 7, 1990, the hull of the steamship American Trader was punctured approximately one -and -one-half miles off the coast of Huntington Beach, California. As a result, the vessel released a quantity of crude -oil into the Pacific Ocean. Oil from the spill spread over a shore area, and oil washed ashore in Huntington Beach, Newport Beach and adjacent and nearby coastal areas. This incident is hereinafter referred to as the "Oil Spill." B. Description of the Litigation 1. On January 4, 1991 the Plaintiffs filed an action in Orange County Superior Court of the State of California, entitled People of the State of California ex. rel. Department of Fish and Game, et al., v. BP America, Inc., et al., Case No. 64 63 39 (the "Action"). The Action sought damages resulting from the Oil Spill from Attransco and from other defendants under California state statutes and common law. 2. On November 30, 1992, Attransco bled a cross -complaint against the State Lands Commission, alleging that the State Lands Commission's negligence was a contributing cause of the Oil Spill. On July 3, 1996, the Superior Court entered judgment in favor of the State Lands Commission, based upon its order granting the Plaintiffs' Motion for Summary Judgment on Attransco's Fourth Amended Cross -Complaint. Attransco's appeal from that judgment is currently awaiting oral argument before the Fourth District Court of Appeal for the State of California, Civ. No. G020335. 3. On December 9, 1997, a jury found Attransco to be liable for the Oil Spill and, on the basis of that verdict, a Judgment was entered against Attransco in favor of the Plaintiffs (the "Judgment"). Attransco filed an appeal from the Judgment in the Fourth District Court of Appeal (Civil No. G022999), and the Plaintiffs filed an appeal from the Superior Court's order awarding costs to the Plaintiffs (Civ. No. G024040). By order of the Court of Appeal dated April 21, 1999, these two appeals were consolidated. C. 'WHEREAS, the Plaintiffs and Attransco wish to enter into this Agreement to resolve any claims which they may have against one another or any liability which they may have towards one another arising out of the Oil Spill and as a result of the Judgment; D. WHEREAS, Attransco and the Plaintiffs desire to avoid the expense and uncertainty of future litigation and by this Agreement desire to effectuate a full and final resolution of any claims arising from the Oil Spill and the Judgment, which exists, or may later exist, by and between the Plaintiffs and Attransco; NOW THEREFORE; In consideration of the promises, conditions and payments set forth herein, the Plaintiffs and Attransco agree to be bound as follows: IL AGREEMENT The Parties hereto have agreed to settle all claims which they have asserted against one another in any pending actions and all claims which they could have asserted against one another arising out of the Oil Spill or the Judgment. In consideration for entering into this Agreement and in consideration for the promises and respective releases set forth below, the Parties hereto agree as follows: A. Effective Date This Agreement shall become effective upon the day when the last Party appends its signature to the Agreement. B. Payment By Attransco Within 30 days of the Effective Date of this Agreement, Attransco shall pay to the Plaintiffs a total sum in the amount of SIXTEEN MILLION U. S. DOLLARS (USD $16,000,000). The funds shall be paid by wire transfer to the California Department of Justice and directed to the American Trader/Litigation Deposit Fund Accounts. Plaintiffs will provide detailed wire transfer information to Attransco no later than five (5) days before said payment is due. C. Mutual Releases and Covenants Not To Sue 1. Upon payment of the Settlement Amount in the manner prescribed in the preceding paragraph of this Agreement, the Plaintiffs release Attransco from, and covenant not to sue or take any other civil or administrative action against Attransco, for any and all claims, liability, or damages, whether presently known or unknown, whether anticipated or unanticipated, that arise from, or are based on, the Oil Spill or the Judgment. For the purposes of this paragraph, "Attransco" includes the S/T American Trader, her boilers and equipment, the present and former directors, officers, shareholders, employees, insurers, and attorneys of Attransco. 2. Upon payment of the Settlement Amount in the manner prescribed in Section I1, paragraph B, Attransco releases each of the Plaintiffs from, and covenants not to sue or take any other civil or administrative action against the Plaintiffs, or any of them, for any and all claims, liability, or damages, whether presently known or unknown, whether anticipated or unanticipated, that arise from, or are based on, the Oil Spill or the Judgment. For the purposes of this paragraph, the term "Plaintiffs" includes present and former officials, employees, insurers, and attorneys of the respective state agencies and local governments set forth above.. 3. In further consideration for the payment set forth above, the Parties waive the protections of California Civil Code Section 1542, which provides: A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which, if known by him, must have'materially affected his settlement with the debtor. This -is not a mere recital but a knowing, voluntary waiver. The Parties acknowledge that this Agreement has been negotiated and agreed upon in good faith and that by executing this Agreement and agreeing to this paragraph, The Parties are waiving all unknown or unsuspected claims arising out of the Oil Spill and the Judgment. 4. The provisions of this Section C shall not apply to the rights or obligations of the Parties under this Agreement or to any claims between and among the Parties unrelated to the Oil Spill or the Judgment. Further, this provision shall not be construed to bar or otherwise impair the ability of the State of California, any agencies or subdivisions thereof, or any applicable local jurisdiction to regulate and/or enforce applicable state laws against Attransco, its insurers, or its attorneys. D. Dismissals of Actions and Claims 1. Within 15 days of the Plaintiffs' receipt of the payment set forth in Paragraph B, Attransco shall cause to be filed in the Fourth District Court of Appeal a full and final dismissal with prejudice of the pending appeals entitled Attransco v. People of the State of California ex rel. Dept. of Fish and Game, et al., Civ. No. G022999, and Attransco v. State Lands Cominission, Civ. No. G020335. 2. Within 15 days of the Plaintiffs' receipt of the payment set forth in Paragraph B, the Plaintiffs shall cause to be filed in the Fourth District Court of Appeal a full and -3- • 0 Final dismissal with prejudice of the appeal entitled People of the State of California, ex rel. Dept. of Fish and Ganne, et al. v. Attransco, Civ. No. G024040. E. Release and Cancellation of Bond; Satisfaction of Judgment 1. Within 15 days of Plaintiffs' receipt of the payment set forth in Paragraph B, the Plaintiffs shall execute a stipulation prepared by Attransco for release and cancellation of the bond previously filed in this action to stay enforcement of the Judgment. 2. Within 15 days of Plaintiffs' receipt of the payment set forth in Paragraph B, the Plaintiffs shall cause to be filed an acknowledgment of satisfaction of the Judgment. F. Cooperation As a condition of this Agreement, Attransco has requested that the Plaintiffs agree to cooperate with Attransco, its insurers and its counsel in Attransco's defense of the class action lawsuit now pending in the United States District Court for the Central District of California before the Honorable Robert J. Kelleher (CV 90-722-RJK) by making witnesses and documents available to Attransco as will reasonably be requested by Attransco. The Plaintiffs, as public entities, agree that their respective employees shall be subject to civil process and shall duly testify pursuant to subpoena at deposition and/or at trial pursuant to the Federal Rules of Civil Procedure and that the Plaintiffs will not object to Attransco's proper exercise of process to secure non -privileged testimony by such employees, or documents. Nothing herein shall constitute a waiver of any privilege or other protection, including but not limited to, the attorney -client privilege and the attorney work product doctrine held by any Party to this Agreement. Attransco will seek the testimony and documents by subpoena duces tecum which may be served on Sylvia C. Hale, Deputy Attorney General. Plaintiffs will not contest the validity or effectiveness of service of subpoena duces tecum properly made on Sylvia C. Hale, Deputy Attorney General, Office of the Attorney General, 300 South Spring Street, Suite 500, Los Angeles, California 90013. Such sei-vice shall be deemed to constitute proper service of process for the purpose of obtaining the testimony and documents contemplated by this Agreement. G. Entire Agreement This Agreement constitutes the entire agreement among the parties with regard to the subject matter hereof and can be modified or amended only with the written consent of the parties to the Agreement. -4- 0 0 H. Counterparts This Agreement may be executed in counterparts, and as executed, shall constitute one agreement, binding on all the Parties even though all Parties did not sign the same. I. Binding on Successors and Assigns This Agreement and all terms and conditions of the settlement and release set forth herein shall be binding upon and inure to the benefit of the Parties and their respective predecessors, successors, parents, subsidiaries, insurers, affiliates, heirs and assigns and upon any corporate or other entity into or with which any Party may merge, combine or consolidate. J. Best Efforts All Parties hereby agree, subject to the terms of this Agreement, to exercise their best efforts and to take all reasonable steps necessary to effectuate the terms of this Agreement. The Parties agree that the settlement embodied in this Agreement is fair and reasonable as to all Parties. K. Joint Drafting of Document This Agreement shall be construed and interpreted to effectuate the intent of the Parties, which is to provide through this Agreement for a complete resolution of the claims between the Parties. This Agreement shall be deemed to have been jointly drafted by the Parties and in construing and interpreting this Agreement, no provision of this Agreement shall be construed or interpreted against any Party because such provision of this Settlement Agreement, as a whole, was purportedly prepared or requested by such Party. L. No Admission of Liability This Agreement constitutes a compromise settlement of disputed claims and shall not be deemed or construed to be an admission of liability by any party for any purpose. M. Notices All notices, requests, demands or other communications required or permitted to be given pursuant to this Agreement shall be in writing and shall be delivered personally, transmitted by facsimile or mailed, postage pre -paid by first class mail, to the undersigned persons at the following addresses, unless notified in writing of a change of address: -5- Counsel for the Cite of Huntin tan Beach James H. Ackerman The Law Office of .lames H. Ackerman One World Trade Center, Suite 1440 Long Beach, Califomia 90831-1440 Telephone. (562) 436-9911 Facsimile: (562) 436-1897 Gail C. Hutton City Attorney City of Huntington Beach P.O. Box 190 Huntington Beach, California 92648-0190 Telephone: (714) 536-5555 Facsimile: (714) 374-1590 Counsel for The County of Orange Nicholas Chrisos Dep. County Counsel Office of the County Counsel County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, California 92702-1379 Telephone: (714) 834-3300 Facsimile: (714) 834-2359 Counsel for City of Newport Beach Robert H. Burnham City Attorney Robin Clauson Asst. City Attorney City of Newport Beach 3300 Newport Boulevard P.Q. Box 1768 Newport Beach, California 92659-1768 Telephone: (949) 644-3131 Facsimile: (949) 644-3139 -6- 0 0 Counsel for PEOPLE OF THE STATE OF CALIFORNIA ex rel. Department of Fish and Game, Department of Parks and Recreation, California Regional Water Quality Control Board, Santa Ana Region, and State_ Lands Commission Sylvia C. Hale. Deputy Attorney General Office of the Attorney General 300 South Spring Street, Suite 500 Los Angeles, California 90013 Telephone: (213) 897-2606 Facsimile: (213) 897-2802 Michael R. Leslie Mary Newcombe Caldwell, Leslie, Newcombe & Pettit 606 South Olive Street, Suite 500 Los Angeles, California 90014 Telephone: (213) 629-9040 Facsimile: (213) 629-9022 Attrartsco's Counsel John J. Reilly Haight Gardner, Holland & Knight A Law Office of Holland & Knight LLP 195 Broadway New York, NY 10007-3189 Telephone: (212) 513-3488 Facsimile: (212) 385-9010 David E.R. Woolley Cogswell, Woolley, Nakazawa & Russell Landmark Square, Suite 2000 111 West Ocean Boulevard Long Beach, California 90802-4614 Telephone: (562) 495-6000 Facsimile: (562) 435-1359 N. Attorneys' Fees If any Party brings an action or other proceeding or otherwise incurs legal fees or costs to enforce the terms or declare rights under this Agreement, the Party prevailing in enforcing the terms or declaring such rights shall be entitled to recover its reasonable attornoysfees and litigation costs. -7- 0 0 b O. Forum Selection Clause The Parties agree that any litigation in respect of this Agreement may only be brought in the Superior Court of Orange County or if the court refuses to hear the matter on the basis of lack of subject matter jurisdiction, any court of competent jurisdiction in Orange County, and the Parties agree to jurisdiction and venue therein. P. Choice of Law This Agreement is entered into and shall be interpreted and enforced pursuant to the laws of the State of California as applied to contracts in writing entered into and performed in California by California residents. Q. Authority to Execute The undersigned signatories to this Agreement represent and warrant that they are fully authorized to enter into and execute this Agreement on behalf of the respective Parties and any insurers for any Party. For the Citv of Huntin ton Beach Dated: Approved as to form: As�e� , City Attorney-/6-SyC-N Dated: l / For The County of Orange Dated: By: Mayor, ity of Huntin ton Bach Attest: G.t, Cityy Clerk The Law Office of James H. Ackerman �o4n One World Trade Center, Suite 1440 Long Beach, California 90831-1440 County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, California 92702-1379 Nicholas Chrisos Dep. County Counsel M O. Forum'Selection Clause The Parties agree that any litigation in respect of this Agreement may only be brought in the Superior Court of Orange County or if the court refuses to hear the matter on the basis of lack of subject matter jurisdiction, any court of competent jurisdiction in Orange County, and the Parties agree to jurisdiction and venue therein. P. Choice of Law This Agreement is entered into and shall be interpreted and enforced pursuant to the laws of the State of California as applied to contracts in writing entered into and performed in California by California residents. Q. Authority to Execute The undersigned signatories to this Agreement represent and warrant that they are fully authorized to enter into and execute this Agreement on behalf of the respective Parties and any insurers for any Party. For the Citv of Huntington Beach Dated: Approved as to form: Dated: For The Count- of Orange Mayor, City of Huntington Beach The Law Office of James H. Ackerman One World Trade Center, Suite 1440 Long Beach, California 90831-1440 James H. Ackerman County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, California 92702-1379 Dated: f �-4' S' Bv: ,,�.vk; Nicholas Chrisos Dep. County Counsel 51.1 El is Approved as to form: Dated: For City of Newport Beach Dated: Approved as to f rm: Dated: County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, California 92702-1379 B_v: Nicholas Chrisos Dep. County Counsel City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Nev,rport ch, California 92659-17 ME MayoyCity of Newport Beach Robert H. Burnham City Attorney For PEOPLE OF THE STATE OF CALIFORNIA ex rel. Department of Fish and Game, Department of Parks and Recreation, California Regional Water Quality Control Board Santa Ana Region, and State Lands Commission Dated: By: Gary Gregory, Administrator of the Office of Oil Spill Prevention and Response, for the Department of Fish and Game Dated: BY: Rusty Arcias Director, Department of Parks and Recreation -9- Approved as to form: County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, Califomia 92702-1379 Dated: Bv: For City of Newport Beach Dated: Approved as to form: Dated: Nicholas Chrisos Dep. County Counsel City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Newport Beach, California 92659-1768 By: Mayor, City of Newport Beach By: Robert H. Burnham City Attorney For PEOPLE OF THE STATE OF CALIFORNIA ex rel. Department of Fish and Game, Department of Parks and Recreation, California Regional Water Quality Control Board. Santa Ana Reeion, and State Lands Commission Dated: By: G G gory, inistrat r of the fFce f Oi] revent' n and ponse, for the ent of Fish and Game Dated: By: Rusty Arcias Director, Department of Parks and Recreation -9- 0 Approved as to form: Dated: For City of Newport Beach Dated: Approved as to form: Dated: County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, California 92702-1379 By: Nicholas Chrisos Dep. County Counsel City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Newport Beach, California 92659-1768 By: Mayor, City of Newport Beach Robert H. Burnham City Attorney For PEOPLE OF THE STATE OF CALIFORNIA ex rel. Department of Fish and Game,'Department of parks and Recreation, California Regional Water Quality Control Board Santa Ana Re ion and State Lands Commission Dated: By: Gary Gregory, Administrator of the Ofii:Gam il Spill eve 'on and sor tl art erit of Fish and Dated:-25 `�`� Sy: Direcy6r, I�epartmcrit of Parks and Reer ati -9- Dated: 36: 7 /." Dated: Approved as to form: Dated: f For Attransco and its insurers Dated: Approved as to form: By: Ge r J. Thibeault Executive Officer Regional Water Quality Control Board, Santa Ana Region Paul D. Thayer Executive Officer State Lands Commission Office of the Attorney General 300 South Spring Street, Suite 500 Los Angeles, California 90013 By: via Cano Hale Deputy Attomey General Haight Gardner, Holland & Knight A Law Office of Holland & Knight LLP 195 Broadway New York, ?STY 10007 �0 John J. Reilly Cogswell Woolley Nakazawa & Russell Landmark Square 11 1 West Ocean Boulevard, Suite 2000 Long Beach, California 90802-4614 Dated: By: David E.R. Woolley -10- r: 0 Dated: Dated: Approved as to form: Dated: r For . ttransco and its insurers Dated: Approved as to form: By: Gerard J. Thibeault Executive Officer Regional Water Quality Control Board, Santa Ana Re ion By: Paul D. Thayer Executive Officer State Lands Commission Office of the Attorney General 300 South Spring Street, Suite 500 Los Angeles, California 90013 By: SC , via Cano Hale Deputy Attorney General Haight Gardner, Holland & Knight A Law Office of Holland & Knight LLP 195 Broadway New York, NY 10007 John J. Reilly Cogswell Woolley Nakazawa & Russell Landmark Square 1 1 I West Ocean Boulevard, Suite 2000 Long Beach, California 90802-4614 Dated: By: David E.R. Woolley -10- . 0 0 Dated: Dated: Approved as to form: Dated: lqqq For Attransco and its insurers Dated: Approved as to form: Dated: Gerard J. Thibeault Executive Officer Regional Water Quality Control Board, Santa Ana Region By: Paul D. Thayer Executive Officer State Lands Commission Office of the Attorney General 300 South Spring Street, Suite 500 Los Angeles, California 90013 By: "-—" S�Ivia Cano Hale Deputy Attorney General Haight Gardner, Holland & Knight A Law Office of Holland & Knight LLP 195 Broadway New York, NY 10007 John J. Reilly Cogswell Woolley Nakazawa & Russell Landmark Square 1 1 I West Ocean Boulevard, Suite 2000 Long Beach, California 90802-4614 David E.R. Woolley -10- Dated: Dated: BY: Approved as to form: Gerard J. Thibeault Executive Officer Regional Water Quality Control Board, Santa Ana Region Paul D. Thayer Executive Officer State Lands Commission Office of the Attorney General 300 South Spring Street, Suite 500 Los Angeles, California 90013 Dated: By: Sylvia Cano Hale Deputy Attorney General For Attransco and its insurers Haight Gardner, Holland & Knight . A Law Office of Holland & Knight LLP 195 Broadway New York, NY 10007 Dated: /v 2 W' T lI � By: Approved as to form: Coi Landmark Square 1 1 1 West Ocean Boulevard, Suite 2000 Long Beach, California 90802-4614 Dated: By: David E.R. Woolley -10- • AUG-J4-35 1^;:34 Froa:CNuaWELL W EY ET- AL. 5624351 M T-326_ P E2/0Z Job-5+1 'I M Dated Dated: Approved ax to farm: Dated: For Attranseo_jae-dits inagrrrg Dated: .� V ✓ST" % ,approved as to form: e Dazed: f r wo' By: Gerard Y. Thihcault - Executive Officer _ - -- Regional water Quality Control Board, Santa Ana Region By: Paul D. Thayer Executive Officer Stale Lands Commission Office of the Attorney General 300 South Spring Sheaf. Suite SOO Los Angeles, Califomia 90013 By: Sylvia Ca=no Hale DcpUty Attorney General Haight Gardner, Holland & Knight A Law Office of Holland & Knight LLP 195 Broadway_ Ne LM C;o g►well Woolley Nak=2wa & Russell Landmark Square 111 W'q;st Ocean Boulevard, Suite 2000 Long C rrua 90802-4614 Y. David E.1L W -1 a- -anosday Au use 4. 1999 8:54 -- from 1212 385 OQ10f -- Page 13 0 DATE: April 6, 2000 TO: Gail Hutton, City Attorney Shari Freidenrich, City Treasurer FROM: Connie Brockway, City Clerk RE: Settlement Agreement — American Trader Oil Spill Please advise as to when the City Clerk's Office will be provided with the fully executed copy that the City Clerk's Office is required to maintain. Your reply would be appreciated by April 17, 2000. CB: mp G:lcbmemos120001American Trader Oil Spill — mp.doc LJ U � ,file Notes Office of the City CCerk Huntington Beach, CaCfornia 08/30/99 - Council/Agency Agenda - Page 2 [Approved recess to closed Session 5-0-2 (Bauer, Harman Absent)] Call Closed Session Of City Council/Redevelopment Agency Recommended Action: Motion to recess to Closed Session on the following items. Closed S2-§-§-i2-!31 - City Gounril pursuant to Government Code Sertion 64957.6 to rneet with its , UebeFt, Frierson, FegaFding 1ab0F relations matters - rneet and confeF with the following OMP10yee GFganizations: IVISOA, one PIVIA, MEA, MEO HBFA, and SC �A (120.80) [Removed from agenda by City Administrator] (Closed Session] - City Council pursuant to Government Code Section 54956.9(a) to confer with its attorney regarding pending litigation which has been initiated formally and to which the city is a party. The title of the litigation is Brindle/Thomas v. City of Huntington Beach - Orange County Superior Court Case No. 75 02 03. Subject: Brindle/Thomas v. City of Huntington Beach. (120.80) (City Council) Closed Session - City Council pursuant to Government Code Section 54956.9(a) to confer with its attorney regarding pending litigation which has been initiated formally and to which the city is a party. The title of the litigation is State of California v. BP America, et al; Orange County Superior Court Case No. 64 63 399. Subject: State of California v. BP America. 6:12 PM - Reconvene In Council Chamber Roll Call Julien, Bauer, Garofalo, Green, Dettloff, Harman, Sullivan [Present (Bauer — absent).] [Report Out of Closed Session — City Attorney reported that Council in closed session approved the settlement agreement between the City of ap Ip Huntington Beach and Mutual General Releases relative to the 1990 oil spill. The title of the litigation is State of California v. BP America, et al; Orange County Superior Court Case No. 64 63 39.] i . a SETTLEMENT AGREEMENT WITH MUTUAL GENERAL_ RELEASE$ This Settlement Agreement with M�4tual General Releases (the "Agreement") is entered into by and between the People of the State of California ex rel. Department of Fish and Game, Department of Parks and Recreation, California Regional Water Quality Control Board, Santa Ana Region, and State Lands Commission; the City of Huntington Beach, a municipal corporation and charter city; the City of Newport Beach, a municipal corporation and charter city; and the County of Orange, a political subdivision of the State of California (collectively "Plaintiffs"), on the one hand, and American Trading Transportation Co., Inc., Attransco, Inc., and their insurers (hereinafter collectively referred to as "Attransco"), on the other hand. I. RECITALS A. Description of the Oil Spill On February 7, 1990, the hull of the steamship American Trader was punctured approximately one -and -one-half miles off the coast of Huntington Beach, California. As a result, the vessel released a quantity of crude oil into the Pacific Ocean. Oil from the spill spread over a shore area, and oil washed ashore in Huntington Beach, Newport Beach and adjacent and nearby coastal areas. This incident is hereinafter referred to as the "Oil Spill." B. Description of the Litigation 1. On January 4, 1991 the Plaintiffs filed an action in Orange County Superior Court of the State of California, entitled People of the State of California ex. rel. Department of Fish and Game, et al., v. BP America, Inc., et A, Case No. 64 63 39 (the "Action"). The Action sought darnages resulting from the Oil Spill from Attransco and from other defendants under California state statutes and common lain. 2. On November 30, 1992, Attransco tiled a cross -complaint against the State Lands Commission, alleging that the State Lands Commission's negligence was a contributing cause of the Oil Spill. On July 3, 1996, the Superior Court entered judgment in favor of the State Lands Commission, based upon its order granting the Plaintiffs' Motion for Summary Judgment on Attransco's Fourth Amended Cross -Complaint. Attransco's appeal from that judgment is currently awaiting oral argument before the Fourth District Court of Appeal for the State of California. Civ. No. G020335. 3. On December 9, 1997, a jury found Attransco to be liable for the Oil Spill and, on the basis of that verdict, a Judgment was entered against Attransco in favor of the Plaintiffs (the "Judgment"). Attransco filed an appeal from the Judgment in the Fourth District Court of Appeal (Civil No. G022999), and the Plaintiffs filed an appeal from the Superior Court's order awarding costs to the Plaintiffs (Civ. No. G024040). By order of the Court of Appeal dated April 21, 1999, these two appeals were consolidated. C. WHEREAS, the Plaintiffs and Attransco wish to enter into this Agreement to resolve any claims which they may have against one another or any liability which they may have towards one another arising out of the Oil Spill and as a result of the Judgment; D. WHEREAS, Attransco and the Plaintiffs desire to avoid the expense and uncertainty of future litigation and by this Agreement desire to effectuate a full and final resolution of any claims arising from the Oil Spill and the Judgment, which exists, or may later exist, by and between the Plaintiffs and Attransco; NOW THEREFORE; In consideration of the promises, conditions and payments set forth herein, the Plaintiffs and Attransco agree to be bound as follows: II. AGREEMENT The Parties hereto have agreed to settle all claims which they have asserted against one another in any pending actions and all claims which they could have asserted against one another arising out of the Oil Spill or the Judgment. In consideration for entering into this Agreement and in consideration for the promises and respective releases set forth below, the Parties hereto agree as follows: A. Effective Date This Agreement shall become effective upon the day when the last Party appends its signature to the Agreement. B. Payment By Attransco Within 30 days of the Effective Date of this Agreement, Attransco shall pay to the Plaintiffs a total sum in the amount of SIXTEEN MILLION U. S. DOLLARS (USD $16,000,000). The funds shall be paid by wire transfer to the California Department of Justice and directed to the American Trader/Litigation Deposit Fund Accounts. Plaintiffs will provide detailed wire transfer information to Attransco no later than five (5) days before said payment is due. C. N•Iutual Releases and Covenants Not To Sue 1. Upon payment of the Settlement Amount in the manner prescribed in the preceding paragraph of this Agreement, the Plaintiffs release Attransco from, and covenant not to sue or take any other civil or administrative action against Attransco, for any and all claims, liability, or damages, whether presently known or unknown, whether anticipated or unanticipated, that arise from, or are based on, the Oil Spill or the Judgment. For the purposes of this paragraph, "Attransco" includes the SIT American Trader, her boilers and equipment, the present and former directors, officers, shareholders, employees, insurers, and attorneys of Attransco. 2. Upon payment of the Settlement Amount in the manner prescribed in Section 1I, paragraph B, Attransco releases each of the Plaintiffs from, and covenants not to sue or take any other civil or administrative action against the Plaintiffs, or any of them, for any and all claims, liability, or damages, whether presently known or unknown, whether anticipated or unanticipated, that arise from, or are based on, the Oil Spill or the Judgment. For the purposes of this paragraph, the term "Plaintiffs" includes present and former officials, employees, insurers, and attorneys of the respective state agencies and local governments set forth above. 3. In further consideration for the payment set forth above, the Parties waive the protections of California Civil Code Section 1542, which provides: A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which, if known by him, must have materially affected his settlement with the debtor. This is not a mere recital but a knowing, voluntary waiver. The Parties acknowledge that this Agreement has been negotiated and agreed upon in good faith and that by executing this Agreement and agreeing to this paragraph, The Parties are waiving all unknown or unsuspected claims arising out of the Oil Spill and the Judgment. 4. The provisions of this Section C shall not apply to the rights or obligations of the Parties under this Agreement or to any claims between and among the Parties unrelated to the Oil Spill or the Judgment. Further, this provision shall not be construed to bar or otherwise impair the ability of the State of California, any agencies or subdivisions thereof, or any applicable local jurisdiction to regulate andfor enforce applicable state laws against Attransco, its insurers, or its attorneys. D. Dismissals of Actions and Claims 1. Within 15 days of the Plaintiffs' receipt of the payment set forth in Paragraph B, Attransco shall cause to be filed in the Fourth District Court of Appeal a full and final dismissal with prejudice of the pending appeals entitled Attransco v. People of the State of California ex rel. Dept. of Fish and Game, et al., Civ. No. G022999, and Attransco v. State Lands Commission, Civ. No. G020335. 2. Within 15 days of the Plaintiffs' receipt of the payment set forth in Paragraph B, the Plaintiffs shall cause to be Fled in the Fourth District Court of Appeal a full and 52 • 0 final dismissal with prejudice of the appeal entitled People of the State of California, ex rel. Dept. of Fish and Game, et al. v. Attransco, Civ. No. G024040. E. Release and Cancellation of Bond; Satisfaction of Judgment 1. Within 15 days of Plaintiffs' receipt of the payment set forth in Paragraph B, the Plaintiffs shall execute a stipulation prepared by Attransco for release and cancellation of the bond previously filed in this action to stay enforcement of the Judgment. 2. Within 15 days of Plaintiffs' receipt of the payment set forth in Paragraph B, the Plaintiffs shall cause to be filed an acknowledgment of satisfaction of the Judgment. F. Cooperation As a condition of this Agreement, Attransco has requested that the Plaintiffs agree to cooperate with Attransco, its insurers and its counsel in Attransco's defense of the class action lawsuit now pending in the united States District Court for the Central District of California before the Honorable Robert J. Kelleher (CV 90-722-RJK) by making witnesses and documents available to Attransco as will reasonably be requested by Attransco. The Plaintiffs, as public entities, agree that their respective employees shall be subject to civil process and shall duly testify pursuant to subpoena at deposition and/or at trial pursuant to the Federal Rules of Civil Procedure and that the Plaintiffs will not object to Attransco's proper exercise of process to secure non -privileged testimony by such employees, or documents. Nothing herein shall constitute a waiver of any privilege or other protection, including but not limited to, the attorney -client privilege and the attorney work product doctrine held by any Party to this Agreement. Attransco will seek the testimony and documents by subpoena duces tecum which may be served on Sylvia C. Hale, Deputy Attorney General. Plaintiffs will not contest the validity or effectiveness of service of subpoena duces tecum properly made on Sylvia C. Hale, Deputy Attorney General, Office of the Attorney General, 300 South Spring Street, Suite 500, Los Angeles, California 90013. Such service shall be deemed to constitute proper service of process for the purpose of obtaining the testimony and documents contemplated by this Agreement. G. Entire Agreement This Agreement constitutes the entire agreement among the parties with regard to the subject matter hereof and can be modified or amended only with the written consent of the parties to the Agreement. -4- H. Counterparts This Agreement may be executed in counterparts, and as executed, shall constitute one agreement, binding on all the Parties even though all Parties did not sign the same. I. Binding on Successors and Assigns This Agreement and all terms and conditions of the settlement and release set forth herein shall be binding upon and inure to the benefit of the Parties and their respective predecessors, successors, parents, subsidiaries, insurers, affiliates, heirs and assigns and upon any corporate or other entity into or with which any Party may merge, combine or consolidate. J. Best Efforts All Parties hereby agree, subject to the terms of this Agreement, to exercise their best efforts and to take all reasonable steps necessary to effectuate the terms of this Agreement. The Parties agree that the settlement embodied in this Agreement is fair and reasonable as to all Parties. K. Joint Drafting of Document This Agreement shall be construed and interpreted to effectuate the intent of the Parties, which is to provide through this Agreement for a complete resolution of the claims between the Parties. This Agreement shall be deemed to have been jointly drafted by the Parties and in construing and interpreting this Agreement, no provision of this Agreement shall be construed or interpreted against any Party because such provision of this Settlement Agreement, as a whole, was purportedly prepared or requested by such Party. L. No Admission of Liability This Agreement constitutes a compromise settlement of disputed claims and shall not be deemed or construed to be an admission of liability by any party for any purpose. NI. Notices All notices, requests, demands or other communications required or permitted to be given pursuant to this Agreement shall be in writing and shall be delivered personally, transmitted by facsimile or mailed, postage pre -paid by first class mail, to the undersigned persons at the following addresses, unless notified in writing of a change of address: -5- Counsel for the City of Huntington Beach James H. Ackerman The Law Off -ice of James H. Ackerman One World Trade Center, Suite 1440 Long Beach, California 90831-1440 Telephone: (562) 436-9911 Facsimile: (562) 436-1897 Gail C. Hutton City Attorney City of Huntington Beach P.O. Box 190 Huntington Beach, California 92648-0190 Telephone: (714) 536-5555 Facsimile: (714) 374-1590 Counsel for The Count' of Orange Nicholas Chrisos Dep. County Counsel Office of the County Counsel County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, California 92702-1379 Telephone: (714) 834-3300 Facsimile: (714) 834-2359 Counsel for City of Newport Beach Robert H. Burnham City Attorney Robin Clauson Asst. City Attorney City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Newport Beach, California 92659-1768 Telephone: (949) 644-3131 Facsimile: (949) 644-3139 M Counsel for PEOPLE OF THE STATE OF CALIFORNIA ex rel. Department of Fish and Game. Department of Parks and Recreation, California Regional Water Ouality Control Board, Santa Ana Region, and State Lands Commission Sylvia C. Hale Deputy Attorney General Office of the Attorney General 300 South Spring Street, Suite 500 Los Angeles, California 90013 Telephone: (213) 897-2606 Facsimile: (213) 897-2802 Michael R. Leslie Mary Newcombe Caldwell, Leslie, Newcombe & Pettit 606 South Olive Street, Suite 500 Los Angeles, California 90014 Telephone: (213) 629-9040 Facsimile: (213) 629-9022 Attransco's Counsel John J. Reilly Haight Gardner, Holland & Knight A Law Office of Holland & Knight LLP 195 Broadway New York, N- W 10007-3189 Telephone: (212) 513-3488 Facsimile: (212) 385-9010 David E.R. Woolley Cogswell, Woolley, Nakazawa & Russell Landmark Square, Suite 2000 111 Nest Ocean Boulevard Long Beach, California 90802-4614 Telephone: (562) 495-6000 Facsimile: (562) 435-1359 N. Attorneys' Fees If any Party brings an action or other proceeding or otherwise incurs legal fees or costs to enforce the terms or declare rights under this Agreement, the Party prevailing in enforcing the terms or declaring such rights shall be entitled to recover its reasonable attorneys' fees and litigation costs. -7- 0 ! O. Forum Selection Clause The Parties agree that any litigation in respect of this Agreement may only be brought in the Superior Court of Orange County or if the court refuses to hear the matter on the basis of lack of subject matter jurisdiction, any court of competent jurisdiction in Orange County, and the Parties agree to jurisdiction and venue therein. P. Choice of Law This Agreement is entered into and shall be interpreted and enforced pursuant to the laws of the State of California as applied to contracts in writing entered into and performed in California by California residents. Q. Authority to Execute The undersigned signatories to this Agreement represent and warrant that they are fully authorized to enter into and execute this Agreement on behalf of the respective Parties and any insurers for any Party. For the City of Huntington Beach Dated: hIff Approved as to form: C ty Attorney JI- 16 _ sy ck Dated: For The Count} of Orange Dated: By: 25Z�—)�4� Mayor,_City of Huntington Beach Attest: CL Cit�yy Clerk The Law Office of James H. Ackerman 044 One World Trade Center, Suite 1440 Long Beach, California 90831-1440 FA - R-OW A James H. Ackerman County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, California 92702-1379 Nicholas Chrisos Dep. County Counsel 0 Approved as to form: Dated: For City of Newport Beach Dated: Approved as to form: Dated: County of Orange 10 Civic Center Plaza F.O. Box 1379 Santa Ana, California 92702-1379 By: Nicholas Chrisos Dep. County Counsel City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Newport Beach, California 92659-1768 By: Mayor, City of Newport Beach WI Robert H. Burnham City Attorney For PEOPLE OF THE STATE OF CALIFORNIA ex rel. Department of Fish and Game, Department of Parks and Recreation, California Regional Water Quality Control Board, Santa Ana Region, and State Lands Commission Dated: By: Gary Gregory, Administrator of the Office of Oil Spill Prevention and Response, for the Department of Fish and Game Dated: By: Rusty Areias Director, Department of Parks and Recreation In • 0 Approved as to form: Dated: For City of Newport Beach Dated: Approved as to form: Dated: County of Orange 10 Civic Center Plaza P.O. Box 1379 Santa Ana, California 92702-1379 By: Nicholas Cli isos Dep. County Counsel City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Newport Beach, California 92659-1768 By: Mayor, City of Newport Beach IM Robert H. Burnham City Attorney For PEOPLE OF THE STATE OF CALIFORNIA ex rel. Department of Fish and Game, Department of Parks and Recreation, California Regional Water Quality Control Board Santa Ana Region, and State Lands Commission Dated: By: Gary Gregory, Administrator of the Office of Oil Spill Prevention and Response, for the Department of Fish and Game Dated: By: Rusty Areias Director, Department of Parks and Recreation U Dated: By: Gerard J. Thibeault Executive Officer Regional Water Quality Control Board, Santa Ana Region Dated: Approved as to form: Dated: For Attransco and its insurers Dated: Approved as to form: Dated: By: Paul D. Thayer Executive Officer State Lands Commission Office of the Attorney General 300 South Spring Street, Suite 500 Los Angeles, California 90013 IIn Sylvia Cano Hale Deputy Attorney General Haight Gardner, Holland & Knight A Law Office of Holland & Knight LLP 195 Broadway New York, NY 10007 0 John J. Reilly Cogswell Woolley Nakazawa & Russell Landmark Square 111 West Ocean Boulevard, Suite 2000 Long Beach, California 90802-4614 By: David E.R. Woolley !�