Common use of BASIS FOR AGREEMENT Clause in Contracts

BASIS FOR AGREEMENT. ‌ A. The Ports of Tacoma and Seattle (“Ports”) are separate port districts governed by locally elected port commissioners. They are 30 miles apart on Puget Sound. There are over 75 different ports in Washington. Washington state law provides for local control of port facilities, and also allows each port to exercise any of its powers jointly with any other port by mutual agreement. B. The Ports are the two largest ports in Washington state, with extensive investments in their marine facilities, and together are the third largest trade gateway in the United States. Each port handles container and other cargos. The Ports estimate that a significant segment of their import cargo is bound for destinations outside Puget Sound, principally the Midwest. This discretionary cargo is critical for the financial stability of the Ports and the private marine terminal operators who operate the terminals. C. The leaders of the Ports believe that recent developments in the shipping industry threaten the future of the United States Pacific Northwest trade. These developments include: 1. The Ports have faced increased competition from other expanding ports across North America, prompting them to explore opportunities for a creative collaboration. 2. Losses in the Pacific trade over the past three years have led shipping lines to consolidate into alliances. Such alliances require ports to craft cooperative responses, where appropriate, to meet shipping lines’ needs. ▇▇▇▇▇▇.▇▇▇▇▇ ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇ agreement.docx 3. Shipping lines are deploying larger container ships. The size of these ships could lead to fewer port calls, but also signals an opportunity for ports that have the capability to handle these vessels through deeper drafts, stronger aprons and berths, and adequate cranes. 4. The larger container ships entering the shipping trades require significant capital investment by ports and marine terminal operators in infrastructure. Ports must make targeted and strategic infrastructure investments to remain competitive. D. The Ports, in recognizing these developments, entered into an earlier discussion agreement that became effective as FMC Agreement No. 201222) (“Discussion Agreement”). The purpose of the Discussion Agreement was to set forth a framework in which the Ports would explore the feasibility of entering into an alliance. In conjunction with the Discussion Agreement, the Ports entered into an interlocal agreement that described how the Ports would proceed to determine the feasibility of entering an alliance (that interlocal agreement is referred to as the “Framework ▇▇▇”). Following consideration of issues relating to the form, management, and content of an alliance between them, the Ports have now concluded their review under the Discussion Agreement and the Framework ▇▇▇ and are prepared to move forward with this Agreement and form an alliance between the Ports. E. The Ports will form the alliance pursuant to the following federal and state authorities: (1) this Alliance Agreement, (2) an interlocal agreement with delegated powers exercised pursuant to the port joint powers statute (RCW 53.08.240) which expressly permits joint operation and investment outside of a port’s district boundaries, (3) RCW 39.34.030, the state Interlocal Cooperation Act, and (4) Title 53.XX RCW, which authorizes the Ports to create a port development authority (“PDA”) to operate certain marine facilities jointly, to be known as The Northwest Seaport Alliance (“Alliance”).

BASIS FOR AGREEMENT. ‌ A. The Ports of Tacoma and Seattle (“Ports”) are separate port districts governed by locally elected port commissioners. They are 30 miles apart on Puget Sound. There are over 75 different ports in Washington. Washington state law provides for local control of port facilities, and also allows each port to exercise any of its powers jointly with any other port by mutual agreement. B. The Ports are the two largest ports in Washington state, with extensive investments in their marine facilities, and together are the third largest trade gateway in the United States. Each port handles container and other cargos. The Ports estimate that a significant segment of their import cargo is bound for destinations outside Puget Sound, principally the Midwest. This discretionary cargo is critical for the financial stability of the Ports and the private marine terminal operators who operate the terminals. C. The leaders of the Ports believe that recent developments in the shipping industry threaten the future of the United States Pacific Northwest trade. These developments include: 1. The Ports have faced increased competition from other expanding ports across North America, prompting them to explore opportunities for a creative collaboration. 2. Losses in the Pacific trade over the past three years have led shipping lines to consolidate into alliances. Such alliances require ports to craft cooperative responses, where appropriate, to meet shipping lines’ needs. ▇▇▇▇▇▇.▇▇▇▇▇ ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇ agreement.docx 3. Shipping lines are deploying larger container ships. The size of these ships could lead to fewer port calls, but also signals an opportunity for ports that have the capability to handle these vessels through deeper drafts, stronger aprons and berths, and adequate cranes. 4. The larger container ships entering the shipping trades require significant capital investment by ports and marine terminal operators in infrastructure. Ports must make targeted and strategic infrastructure investments to remain competitive. D. The Ports, in recognizing these developments, entered into an earlier discussion agreement that became effective as FMC Agreement No. 201222) (“Discussion Agreement”). The purpose of the Discussion Agreement was to set forth a framework in which the Ports would explore the feasibility of entering into an alliance. In conjunction with the Discussion Agreement, the Ports entered into an interlocal agreement that described how the Ports would proceed to determine the feasibility of entering an alliance (that interlocal agreement is referred to as the “Framework ▇▇▇”). Following consideration of issues relating to the form, management, and content of an alliance between them, the Ports have now concluded their review under the Discussion Agreement and the Framework ▇▇▇ and are prepared to move forward with this Agreement and form an alliance between the Ports. E. The Ports will form the alliance pursuant to the following federal and state authorities: (1) this Alliance Agreement, (2) an interlocal agreement (attached as Exhibit A) with delegated powers exercised pursuant to the port joint powers statute (RCW 53.08.240) which expressly permits joint operation and investment outside of a port’s district boundaries, (3) RCW 39.34.030, the state Interlocal Cooperation Act, and (4) Title 53.XX RCW, which authorizes the Ports to create a port development authority (“PDA”) to operate certain marine facilities jointly, to be known as The Northwest Seaport Alliance (“Alliance”).Chapter

BASIS FOR AGREEMENT. ‌ A. The Ports of Tacoma and Seattle (“Ports”) are separate port districts governed by locally elected port commissioners. They are 30 miles apart on Puget Sound. There are over 75 different ports in Washington. Washington state law provides for local control of port facilities, and also allows each port to exercise any of its powers jointly with any other port by mutual agreement. B. The Ports are the two largest ports in Washington state, with extensive investments in their marine facilities, and together are the third largest trade gateway in the United States. Each port handles container and other cargos. The Ports estimate that a significant segment of their import cargo is bound for destinations outside Puget Sound, principally the Midwest. This discretionary cargo is critical for the financial stability of the Ports and the private marine terminal operators who operate the terminals. C. The leaders of the Ports believe that recent developments in the shipping industry threaten the future of the United States Pacific Northwest trade. These developments include: 1. The Ports have faced increased competition from other expanding ports across North America, prompting them to explore opportunities for a creative collaboration. 2. Losses in the Pacific trade over the past three years have led shipping lines to consolidate into alliances. Such alliances require ports to craft cooperative responses, where appropriate, to meet shipping lines’ needs. ▇▇▇▇▇▇.▇▇▇▇▇ ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇ draft.discussion agreement.docx 3. Shipping lines are deploying larger container ships. The size of these ships could lead to fewer port calls, but also signals an opportunity for ports that have the capability to handle these vessels through deeper drafts, stronger aprons and berths, and adequate cranes. 4. The larger container ships entering the shipping trades require significant capital investment by ports and marine terminal operators in infrastructure. Ports must make targeted and strategic infrastructure investments to remain competitive. D. The Ports, in recognizing these developments, entered into an earlier discussion agreement that became effective as FMC Agreement No. 201222) (“Discussion Agreement”). The purpose of the Discussion Agreement was to set forth a framework in which the Ports would explore the feasibility of entering into an alliance. In conjunction with the Discussion Agreement, the Ports entered into an interlocal agreement that described how the Ports would proceed to determine the feasibility of entering an alliance (that interlocal agreement is referred to as the “Framework ▇▇▇”). Following consideration of issues relating to the form, management, and content of an alliance between them, the Ports have now concluded their review under the Discussion Agreement and the Framework ▇▇▇ and are prepared to move forward with this Agreement and form an alliance between the Ports. E. The Ports will form the alliance pursuant to the following federal and state authorities: (1) this Alliance Agreement, (2) an interlocal agreement with delegated powers exercised pursuant to the port joint powers statute (RCW 53.08.240) which expressly permits joint operation and investment outside of a port’s district boundaries, (3) RCW 39.34.030, the state Interlocal Cooperation Act, and (4) Title 53.XX RCW, which authorizes the Ports to create a port development authority (“PDA”) to operate certain marine facilities jointly, to be known as The Northwest Seaport Alliance (“Alliance”).