Item No. 10d_attach
Meeting Date: June 25, 2024

Preferential Berthing Agreement
THIS PREFERENTIAL BERTHING AGREEMENT (the "Agreement") is made as of this
___ day of June 2024, by and among the Port of Seattle ("Port"), on the one hand, and Holland
America Line N.V. in its capacity as general partner of Cruiseport Curacao C.V. ("HAL"), Princess
Cruise Lines, Ltd., a Bermuda corporation ("PCL"), and Carnival Cruise Line, a division of Carnival
Corporation, a Panama corporation (“CCL”), (HAL, PCL, and CCL collectively hereinafter referred
to as the “Carnival Lines”).
WHEREAS, the Port is the owner of a two-berth cruise facility located at its Terminal 91 (the
“Smith Cove Cruise Terminal") and a single berth cruise facility located at its Terminal 66 (the “Bell
Street Cruise Terminal”); and
WHEREAS, the Carnival Lines wish to secure, and the Port is willing to grant, the preferential
right to operate from and berth their vessels at the Smith Cove Cruise Terminal for a period of up to
ten years, with an additional five year option exercisable by the parties on the terms set forth in
Section 1 below;
WHEREAS the Port of Seattle and the Carnival Lines share goals around decarbonization and
creating economic benefit in the community and wish to formalize these shared goals.
WHEREAS, the Carnival Lines have made investments in shoreside infrastructure to allow
vessels to plug in and the Port of Seattle and the Carnival Lines share the goal of allowing other cruise
lines to utilize these facilities to further the shared decarbonization goals.
NOW THEREFORE, in consideration of the mutual premises set forth, the parties agree as
follows:
1.
Term. This Agreement shall, unless earlier terminated pursuant to any provision hereof, be
effective for the 2024 through 2033 cruise seasons (the "Term"). References to “Term” in this
Agreement shall include any extension thereof pursuant to the option referenced in this Section 1. For
the Smith Cove Cruise Terminal, the typical cruise season runs from mid-April through mid-October.
Subject to the Port’s sole consent, if the Carnival Lines are in compliance with the terms and
conditions of this Agreement, and achieve the commitments in Section 6.5 below, the Carnival Lines
shall have the option to request a five (5) year extension of the Term through the 2038 cruise season.
In the event the Carnival Lines wish to extend the Term through the 2038 cruise season, the Carnival
Lines shall provide the Port with written notice of the Carnival Lines’ request to exercise such option
between July 1, 2030 and November 1, 2030. No later than ninety (90) days after receipt of such
written notice, the Port, in its sole discretion, may provide the Carnival Lines with written
confirmation of the Port’s consent to the extension. The Port’s failure to provide the Carnival Lines
with such written notice within the stated ninety (90) day period shall constitute the Port’s refusal to
consent to the extension, and the Agreement shall terminate after the 2033 cruise season.

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2.

Preferential Berthing Rights.

2.1
Cruise Berth Days. The Smith Cove Cruise Terminal has two berths, a west
berth of approximately 1200 linear feet, and an east berth of approximately 1300 linear feet.
Each of those two berths is available for use Sunday through Saturday, mid-April through mi dOctober. Unless otherwise specifically agreed, only one cruise vessel may utilize each berth on
any day. As used herein, each day of the week during the cruise season for each cruise berth
at the Smith Cove Cruise Terminal is referred to as a "Cruise Berth Day." (In other words,
each Sunday during the cruise season for a particular berth is considered a Cruise Berth Day;
each Monday during the cruise season for a particular berth is considered a Cruise Berth Day;
etc.)
2.2
Guaranteed Berthing Preference. For each cruise season during the Term, the
Carnival Lines shall have a guaranteed berthing preference for each Cruise Berth Day utilized by
the Carnival Lines f o r a m i n i m u m o f t w e l v e ( 1 2 ) c a l l s during the prior cruise season at
the Smith Cove Cruise Terminal. For the avoidance of doubt, based on 2023 usage, during
the 2024 Alaska Cruise Season, t h e Carnival Lines will have a berthing preference for two
berths on Saturday and Sunday and for one berth on Tuesday and Thursday. The parties
acknowledge that the berthing preferences are not brand-specific and any of the Carnival Lines
may utilize any of the berthing preferences referenced herein.
2.3
Port of Call Vessels. The Port shall, without the necessity of providing the
Carnival Lines the right of first refusal, have the ability to schedule individual port of call vessels
on any calendar day not otherwise committed to the Carnival Lines under Section 2.2.
2.4
Bell Street Cruise Terminal. For the avoidance of doubt, the Carnival Lines shall
have no preferential berthing rights at the Bell Street Cruise Terminal, or any other future
terminal operated by the Port of Seattle, under this Agreement. Notwithstanding, the Carnival
Lines or any Affiliated Lines may schedule vessel calls at the Bell Street Cruise Terminal by
agreement with the terminal operator.
3.

Port's Operation and Maintenance of Terminal.

3.1
General Standard. The Port shall throughout the Term, ensure that the Smith
Cove Cruise Terminal and ancillary port facilities a r e m a i n t a i n e d a n d o p e r a t e d
consistent with good maritime practices and industry standards for a functional cruise ship
terminal and otherwise as necessary to ensure that the Smith Cove Cruise Terminal is able to
be utilized by the Carnival Lines for its intended purpose.
3.2
Parking and Busing. All costs for transporting people and baggage between the
designated passenger vehicle parking area, Ride Share based hub location on terminal in support
of the Smith Cove Cruise Terminal and the passenger terminal building at the Smith Cove
Cruise Terminal and all operating costs and equipment related to the parking area and shuttle
system including any additional or unforeseen labor expense shall be the responsibility of the cruise
terminal operator at Smith Cove Cruise Terminal. The Port, o r i t s c o n t r a c t o r s , t e n a n t s
o r a g e n t s , may collect a vehicle parking fee from the cruise passengers who use the secure
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parking area which supports the Smith Cove Cruise Terminal based on a per day charge for
the length of time they are away on their cruise.
3.3
The Port reserves the right of secondary use of all or any part of the Smith Cove
Cruise Terminal for berthing of vessels operated by companies, other than the Carnival Lines, for
loading and discharging cargoes of such vessels, for transporting cargo, and for cargo storage and
operations incidental thereto, provided that such secondary use of the Smith Cove Cruise Terminal by
the Port shall not unreasonably interfere with the Carnival Lines’ operations as authorized in this
Agreement. In the event of such secondary use by the Port, all applicable charges shall accrue to the
benefit of and shall be billed and retained by the Port.
4.

Port Fees.
4.1

Bundled Fees.

4.1.1 General Rule. For the Term, the Port agrees that it will continue to
"bundle" its fees associated with the use of the Smith Cove Cruise Terminal and express them on
a per-passenger basis as currently set forth in Port of Seattle Marine Terminals Tariff No. 5.
The bundled per-passenger fee consists solely of the: (i) Passenger Fee (as defined below), (ii)
Dockage F ee (as defined below), (iii) baseline security fees, (iv) fresh water connection fee,
and (v) fire department fee for bunkering permit. As in previous cruise seasons, variable fees
dependent on use (for example, water use or extra security) or delay are excluded from the
bundled fee and will be billed separately based on actual quantity/time used and rates then in
effect.
4.1.2 No New Fees. Except as may otherwise be agreed by the parties, the Port
agrees that, for the Term of the Agreement, neither it nor its cruise terminal operator at Smith
Cove Cruise terminal will charge any new port fees or assessments other than: (i) those
described in Section 4.2 below; (ii) those mandated by federal, state, or other local
governmental entities; and (iii) reimbursable costs associated with new or additional services
requested by the Carnival Lines. Notwithstanding the foregoing, the Port may at any time (and
without the consent of the Carnival Lines) elect to discontinue its assessment and/or collection of
any of the fees otherwise eligible for inclusion in the bundled fee.
4.2
Future Capital Investment. Notwithstanding Section 4.1.2, the Port shall be
entitled to impose reasonable additional surcharges on the Carnival Lines associated with the
cost of any fixtures, improvements, equipment or other capital items that are made or added to
the Smith Cove Cruise Terminal during the Term of the Agreement. The Carnival Lines may
provide recommendations or suggestions regarding future capital improvement projects.
4.3

Limitations on Cost Escalation.
4.3.1

Passenger Fee; Dockage Fee

4.3.1.1 If ninety percent (90%) of the calls by vessels operated by
Affiliated Lines in the 2024 cruise season are shore-power enabled, the

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passenger fee component of the bundled fee (the “Passenger Fee”), and
the dockage fee component of the bundled fee (“Dockage Fee”) shall be
90% of the Passenger Fee and Dockage Fee described in the published
tariff for the 2024 cruise season;
4.3.1.2 For the 2025 through 2028 cruise seasons the Passenger Fee
and Dockage Fee shall be increased by four and a half percent (4.5%)
annually, or the rate of increase in the published tariff for such cruise season,
whichever is lower;
4.3.1.3 For the 2029 cruise season, the Passenger Fee and
Dockage Fee will be ninety percent (90%) of the Passenger Fee and
Dockage Fee described in the published tariff for the 2029 cruise season;
4.3.1.4 For the 2030 through 2033 cruise seasons, the Passenger
Fee and Dockage Fee shall be increased by four and a half percent (4.5%)
annually, or the rate of increase in the published tariff for such cruise
season, whichever is lower; and
4.3.1.5 Should the Port consent to a Carnival Lines request to
exercise the option described in Section 1 above, the Passenger Fee and
Dockage Fee that shall apply during the 2034 cruise season shall be ninety
percent (90%) of the Passenger Fee and Dockage Fee described in the
published tariff for the 2034 cruise season, and for the 2035 through 2038
cruise seasons, the Passenger Fee and Dockage Fee shall be increased by
four and a half percent (4.5%) annually, or the rate of increase in the
published tariff for such cruise season, whichever is lower.

4.4

Other Components in the Bundled Fee.

4.4.1 Baseline Security Fee. Any increases in this fee will be limited to actual
documented increases in the third-party cost of providing this service. To the extent that there
is any current markup imposed on this fee, the Port and/or its cruise terminal operator may
continue to charge and collect such markup (specifically including on any allowable increase)
but will not increase or otherwise change the methodology for calculating such markup.
4.4.3 DOE Memorandum of Understanding Program Fee. Any increases in this
fee will be limited to those assessed by the Department of Ecology. The Port has advised the
Carnival Lines that the Department of Ecology may elect to bill this fee directly to the
Carnival Lines, in which event it would no longer be assessed by the Port as part of the Tariff.
4.4.4 Fire Department Fee for Bunkering Permit. Any increases in this fee
will be limited to those assessed by the Seattle Fire Department.
4.5

Other Items. Reimbursable items not included in the bundled fee under
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Section 4.1.1 will continue to be charged in a manner consistent with the 2023 cruise season for
the Term of the Agreement but at rates then in effect for such items.
5.

Minimum Passenger Guarantees.

5.1
Basic Guarantee. The Carnival Lines agree that in each cruise season for the
Term of the Agreement they will guarantee a combined minimum of 550,000 revenue passengers
(275,000 unique passengers) per year across the Smith Cove Cruise Terminal, the Bell Street
Cruise Terminal, and any future Port of Seattle cruise terminal (the "Basi c Guarantee"). For
purposes of meeting the Basic Guarantee, (i) revenue passengers from both home port and
port of call vessels will be counted and each revenue passenger will be counted; and (ii)
revenue passengers from calls by vessels operated by Affiliated Lines will be counted, e ach
time the bundled per-passenger fee is paid for such revenue passenger. For purposes of the
Agreement, port of call vessels include both vessels making an in-transit call at the Smith Cove
Cruise Terminal, the Bell Street Cruise Terminal, or any future Port of Seattle cruise terminal,
and those vessels which, although not home ported in Seattle, make one or more turnaround
calls at the Smith Cove Cruise Terminal, the Bell Street Cruise Terminal, or any future Port of
Seattle cruise terminal. The reconciled number of revenue passengers for whom the bundled
per-passenger fee is paid will be used for purposes of determining whether the Basic Guarantee
has been met.
5.2
Shortfall in Revenue Passengers Under the Basic Guarantee. In the event that the
Carnival Lines (together with the Affiliated Lines) fail to bring a combined minimum of 550,000
revenue passengers (275,000 unique passengers) for any cruise season, the Carnival Lines
shall make good on the shortfall at a rate equal to the bundled fee payable under this Agreement
for the calendar year in which it was to be paid. The shortfall amount, if any, is due no
later than December 31 of the year the shortfall occurs.
5.3
Use of Excess Revenue Passengers. In the event that the Carnival Lines fail to bring a
minimum of 550,000 revenue passengers (275,000 unique passengers), for any cruise season, they
may designate up to 10,000 revenue passengers (5,000 unique passengers) in excess of the minimum
from the immediately preceding cruise season within the Term of this Agreement to satisfy the Basic
Guarantee.
5.4
Market Incentive Credit. Starting in the 2025 cruise season, if the Carnival Lines
have satisfied the Basic Guarantee for any given year, they shall be entitled, in addition to the
benefits set forth above in Section 4, to a Market Incentive Credit up to a maximum of $600,000
per cruise season. Prior to the beginning of the 2025 cruise season, the parties will agree to a
baseline number in two categories, 1) Increases in the number of days of pre/post stays by cruise
guests, as determined by Intercept surveys from the Port of Seattle, and 2) contracting dollars
spent by Carnival Lines to local, small, tribal and disadvantaged businesses in provisioning
sourcing. Annual increases in growth will be eligible for the following incentives for each of the
two categories:
Less than 1.00%

= $0

Between 1.00-1.99% = $100,000

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Between 2.00-2.99% = $150,000
Between 3.00-3.99% = $200,000
Between 4.00-4.99% = $250,000
5.00% and above

= $300,000

The baseline will reset prior to the 2029 cruise season to the highest year’s achievement
between 2025-2028, or the baseline for the 2025 cruise season, whichever is higher. If the term is
extended in accordance with the option referenced in Section 1, the baseline will reset prior to the
2034 cruise season to the highest year’s achievement between 2025-2033, or the baseline for the
2025 cruise season, whichever is higher.

The Carnival Lines will be entitled to a credit in accordance with the thresholds identified
above to be applied against the bundled fees for the subsequent cruise season.
5.5 Audit. The Carnival Lines shall maintain during the term of this Agreement true and
accurate records, books and data to the extent relevant or necessary to reasonably determine the
Carnival Lines compliance with Section 5.4, and that support the number of revenue passengers
(both on Affiliated Lines and otherwise) passing through Terminal 91 for a minimum of three (3)
years following each cruise season, and as may from time to time be requested by the Port, in
accordance with generally accepted accounting principles. The Port shall be permitted to audit
and examine all such records and books of account relating to this Agreement, upon reasonable
notice. The records, books and data shall be made available for inspection by authorized
representatives of the Port at upon reasonable notice during business hours; provided, however, the
Port shall only have the right to inspect the Carnival Lines records to the extent reasonably necessary
to verify the number of revenue passengers reported by the Cruise Lines and entitlement to credits
under Section 5.4. The cost of any audit of these records shall be borne by the Port unless the result of
such audit reveals an understatement of the number of revenue passengers of more than one-half of
one percent (0.5%), or an overstatement of entitlement to a credit under Section 5.4, in which event
the full cost of the audit will be paid by the Carnival Lines.
6.
Environmental Stewardship. The Carnival Lines have worked closely with the Port of Seattle,
and partners like Washington Department of Ecology, and Puget Sound Clean Air Agency to reduce
environmental impacts of cruise ship operations, including installation of shore-side electrical power,
equipping of ships for shore-side electrical power, and installation and operation of advanced
wastewater treatment systems. With this collaborative effort a strong partnership has evolved as the
cruise industry has grown in Seattle. The Port and Carnival Lines will work together to resolve
environmental issues as they arise; this will further grow the business relationship. Through this
continued partnership and as part of this Agreement, the Carnival Lines will provide the Port with
necessary data, during the cruise season, as requested as well as providing a summary following each
cruise season over the term of this Agreement, for tracking, reporting and communicating
environmental progress. Additionally the Carnival Lines will support the elements listed in the
attached Exhibit A and Exhibit B and the items below:

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6.1
Cruise MOU. The Carnival Lines will continue to comply with agreements with
Washington Department of Ecology concerning water quality, and vessel discharge management
practices. Carnival Lines will continue to provide information for and participate in annual reviews of
such agreements and seek consensus on modifications needed to any agreements during this process.
6.2
Shore Power. All homeported vessels will be shore power capable by the 2026
Cruise Season. The Carnival Lines will connect all home-ported ships unless shore power is
unavailable for connection due to actions of the Port of Seattle or Seattle City Light (such as
maintenance or outages). On an annual basis the Carnival Lines will meet with the Port of Seattle staff
to evaluate home-porting operations and strategies to increase the use of shore power toward a goal of
achieving 100-percent use. These requirements are subject to reasonable modification in the future.
The Port may, at its option, for purposes of internal and external air quality and emission
program planning, tracking, and communications, obtain from the vessel captain, owners or its
representatives information about the methods by which ships achieve ECA compliance, (compliance
as managed by USCG) about exhaust gas cleaning system operations and fuel use while inside ECA,
and about the use of shore power at berth. Information provided will help inform the Northwest Ports
Clean Air Strategy, regional and Port emission inventory updates, and implementation of Port of
Seattle’s Century Agenda and greenhouse gas emission reduction goals.
6.3
Air Quality and Greenhouse Gas Emissions Inventory. On at least an annual basis, the
Carnival Lines will participate, with Port of Seattle and partners, in evaluating, planning and/or
developing strategies to reduce emissions from ocean going vessels in accordance with the Northwest
Ports Clean Air Strategy and in support of Port of Seattle’s Century Agenda and greenhouse gas
emission reduction goals. This will include participation in Emission Inventories conducted by the
Port of Seattle, on an annual basis.
6.4
Sustainability Partnerships. In support of shared sustainability goals and strategies
(e.g. air quality, water quality, waste management, energy efficiency, and items described in Exhibit
A) for on-terminal transportation (e.g., shuttle buses), equipment (e.g., cargo handling equipment),
regional ground transportation (e.g., motor coach operations and Transportation Network Companies),
and as part of the annual planning for shore-side transportation operations, the Carnival Lines will
strive to minimize air emissions. This includes demonstrated efforts to employ options such as
preferred contracting, incentives, use of newer and/or low and zero-emission buses and engines, low
and zero-emission fuels in vehicles and equipment, building efficiency measures, advanced pollution
control device retrofits and anti-idling programs. The Carnival Lines will work with Port of Seattle
and partners, on at least an annual basis, to identify joint sustainability opportunities, projects, and
programs. Where feasible and when agreed upon, the Carnival Lines will work with Ports and partners
to develop implementation plans, schedules, and joint communication strategies which may include an
option for partnership-funding mechanisms.
6.5
GHG reductions. Carnival Corporation's GHG reduction goals are generally aligned
with the Port of Seattle’s. The Northwest Ports Clean Air Strategy (the NWPCAS) sets a vision to
phase out emissions from seaport-related activities by 2050, supporting cleaner air for our local
communities and fulfilling our shared responsibility to help limit global temperature rise to 1.5ºC.
The Port of Seattle GHG reduction goals include scope 1 and 2 targets to achieve an absolute
reduction of 50% by 2030 from a 2005 baseline and net zero by 2040, and scope 3 targets to achieve

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an absolute reduction of 50% by 2030 from a 2007 baseline and carbon neutral by 2050. Carnival
Corporation’s goals are to reduce scope 1 GHG emissions intensity by 20% by 2026 from a 2019
baseline and to pursue net zero by 2050. In pursuit of these goals, the Carnival Lines agree to the
following:
6.5.1 The Carnival Lines agree to bunker non-fossil fuel as a demonstration project
in Seattle during the 2024 cruise season, subject to availability. The Carnival Lines will
collaborate with the Port on the scope of the demonstration project, the total cost of which will
be at least $500,000, but not to exceed $600,000. As part of the project, a detailed report
summarizing the demonstration project will be compiled and shared with the Port of Seattle.
The report will include a description of key learnings and recommendations for employing use
of similar fuels at scale. Upon receipt, review and approval of the detailed report of the
demonstration project by the Port, Carnival Lines will be entitled to a $300,000 credit against
the bundled fees for the 2024 season, if the report is received prior to September 15, 2024, or
otherwise for the 2025 cruise season if received prior to September 15, 2025.
If the parties agree that a minimum amount of suitable fuel is not available in 2024, the

parties will attempt this demonstration project again during the 2025 season subject to
the same availability constraints as above, and the $300,000 credit associated with the
receipt, review and approval of the detailed report of the demonstration project would be
applied against the bundled fees for the 2025 cruise season if the report is received by
September 15, 2025, or 2026 cruise season if received by December 31, 2025.

The Port and Carnival Lines will jointly work on a campaign to ensure the non-fossil fuel pilot
test is leveraged to draw broad awareness among Government stakeholders, fuel supply chain
and regulators to support economic transition of maritime alternative fuels.
6.5.2 Carnival Corporation supports the 2023 International Maritime Organization
(IMO) Strategy on Reduction of GHG Emissions from Ships and will support the associated
short-, mid- and long-term GHG reduction measures to be put in place by the IMO in the
coming years, which are intended to create the incentives required to achieve its levels of
ambition. As an example, the Carnival Lines fully support the development of economic
measures to support the availability and cost-competitiveness of non-fossil fuel in Seattle and
will strive for a minimum of 5% non-fossil fuel by 2030 across all homeport ships in Seattle.
6.5.3 Carnival Corporation's GHG reduction goals are generally aligned with the Port
of Seattle’s Northwest Ports Clean Air Strategy (NWPCAS). Carnival Corporation commits to
a reduction of annual greenhouse gas emissions per Available Lower Berth Day of at least
20% by 2030 compared to a 2019 baseline. Both parties acknowledge that IMO GHG
intensity measures for cruise are likely to change.

6.5.4 Carnival Corporation will strive to demonstrate a reduction in total (absolute)
GHG emissions across its global fleet compared to a 2008 baseline by 2030. Carnival Lines
will give due consideration to the Port’s goal of reducing absolute GHG emissions by 50% by
2030. Carnival Corporation also commits to developing potential decarbonization pathways
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and associated prerequisite assumptions regarding fuel supply and/or technology
advancements and will share the results with the Port by December 31, 2026.
6.5.5 The Carnival Lines and the Port will meet annually to review progress on
commitments, decarbonization and environmental action, and overall performance. This
annual review may be combined with other annual meetings and reviews described elsewhere
in this Agreement. The Port will consider these factors in determining whether to consent to a
request to extend the term as described in Section 1. The GHG emissions accounting
methodology, including well to wake accounting and boundary of measurement will utilize the
methodologies developed through the Pacific Northwest to Alaska Green Corridor
(PNW2AK) to the extent possible. Any portions of a required methodology not determined
through the PNW2AK collaboration will be developed and mutually agreed to by the Parties
within 6 months of the PNW2AK Emissions Methodology being developed, but not later than
December 31, 2026.
7.

Force Majeure.

7.1
Performance Excused. Notwithstanding any language that may be construed to
the contrary herein, the Carnival Lines will not have to satisfy the Basic Guarantee or any of its
other obligations if an event of Force Majeure (as defined below) occurs. Likewise, the Port
will not have to satisfy its obligations under this Agreement if an event of Force Majeure (as
defined below) occurs. The party claiming Force Majeure must promptly give the other party
notice of such event of Force Majeure.
7.2
Definition. As used in this Agreement, the term “Force Majeure” means
events beyond the reasonable control of a party the consequence of which is that the party is
unable to satisfy its obligations under the Agreement, which events include, but are not
limited to, the following: acts of God including, without limitation, fire, a severe storm or an
earthquake; labor unrest; changes in governmental laws, rules, policies or regulations that
significantly interfere with vessel or terminal operations including the Passenger Vessel
Services Act or similar or successor legislation; o u t b r e a k o f d i s e a s e o r
p a n d e m i c ; damage to a vessel or other circumstances that preclude a vessel from
operating in the normal course; damage to the Smith Cove Cruise Terminal or other
circumstances that preclude the Smith Cove Cruise Terminal from operating in the normal
course; embargo on passengers by Canada; blockade of U.S. vessels impeding the ability to
operate in the Alaska market; or an order, act, or restriction imposed by any civil or military
authority affecting operations at the Port, of the vessels, or in the Alaska market. Force Majeure
also includes acts of war or acts of terrorism that affect the ability to operate at the Smith Cove
Cruise Terminal or in the Alaska market and riots or insurrections at or near the Smith Cove
Cruise Terminal or the Carnival Lines’ Alaska terminals.
7.3
Reduction in Basic Guarantee. Notwithstanding the foregoing, the Basic
Guarantee for the period during which the event of Force Majeure is continuing shall be reduced
in a fair and equitable manner taking into account the extent of the impact of the event of Force
Majeure on the Carnival Lines’ operations at the Smith Cove Cruise Terminal, the Bell Street

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Cruise Terminal, or any future Port of Seattle cruise terminal. The Carnival Lines shall not be
entitled to any Market Incentive Credit during any period of time for which it is excused from
meeting the Basic Guarantee (unless, notwithstanding the event of Force Majeure, the Carnival
Lines meet the Basic Guarantee).
7.4
Recognition of Long-Term Planning. The parties acknowledge that the Carnival
Lines’ itineraries need to be published sufficiently in advance of the actual cruise season
(generally more than one year) to enable the Carnival Lines to market the cruises and otherwise
make appropriate arrangements with ports-of-call and otherwise. Accordingly, if an event of
Force Majeure occurs and is continuing and may have a duration that extends into a subsequent
cruise season, the Carnival Lines may, at such time as they must finalize itineraries for the
subsequent cruise season, notify the Port that they will need to cancel all or part of the calls for
that season, in which event the Basic Guarantee will not be applicable to that season.
8.
Damage, Destruction or Condemnation. Should any part of the Smith Cove Cruise
Terminal necessary for the operation of the Smith Cove Cruise Terminal be either (i) damaged or
destroyed by fire or other casualty such that it cannot, with due diligence, be repaired within one
sixty (60) days of the occurrence to an extent necessary to enable the Carnival Lines to utilize
the Smith Cove Cruise Terminal for its intended purpose, or (ii) taken by condemnation by any
federal, state or other local governmental entity such that the remainder of the Smith Cove
Cruise Terminal cannot, with due diligence, be modified within sixty (60) days after the
effective date of the condemnation so as to enable the Carnival Lines to utilize the Smith Cove
Cruise Terminal for its intended purpose, the Port shall have the option to terminate this
Agreement and, in that event, neither party shall be obligated to pay any amount for
termination. The Port shall provide its written notice of termination not more than ninety (90)
days after the occurrence giving rise to the right to terminate. If the Port elects to continue this
Agreement notwithstanding such occurrence, it shall proceed with due diligence to complete any
work necessary to restore or repair the Smith Cove Cruise Terminal to meet its obligations under
this Agreement, but both parties shall be excused, as an event of Force Majeure, from satisfying
their obligations, including, in the case of the Carnival Lines, their obligation to satisfy the Basic
Guarantee, for the period from the date of the damage, destruction or condemnation until the
completion of the restoration and repair.
9.
Termination for Default. If a party shall default in its obligations under this Agreement and
shall fail to cure the default within fifteen (15) days after notice from the non-defaulting party (unless
the default is not curable, in which event there shall be no requirement of notice or cure period), the
non-defaulting party may, by notice to the defaulting party, terminate this Agreement. The termination
of this Agreement shall not terminate the liabilities and obligations of the parties already accrued as at
termination.
10.
Defaults. Except as otherwise expressly provided above, in the event a party shall default
in its obligations under the Agreement, the other party shall have all rights and remedies
available to it at law or in equity.
11.

Other Benefited Parties.

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11.1 Affiliated Lines. The Carnival Lines are owned by, or under the direct control
of, Carnival Corporation and/or Carnival plc. The parties specifically agree that the Carnival
Lines may satisfy their obligations under this Agreement through vessels owned by: (i) CCL,
PCL or HAL, and/or (ii) any other operating line(s) owned by Carnival Corporation and/or
Carnival plc (the "Affiliated Lines"). Likewise, the Affiliated Lines shall, when making use of
the Smith Cove Cruise Terminal, be entitled to any benefits hereunder, and any revenue
passengers provided by such Affiliated Lines shall specifically apply, as designated by the
Carnival Lines under the terms of this Agreement, towards the satisfaction of the Carnival
Lines' obligations hereunder, including but not limited to the Carnival Lines’ obligations pursuant
to the Basic Guarantee.
11.2 No Other Assignment. Except as expressly set forth in Section 11.1, the benefits
provided under this Agreement are personal to the Carnival Lines and shall not, i n whole or in
part, be assigned, licensed or otherwise transferred to any party other than the Carnival
Lines. The prohibition against assignment, license or transfer specifically includes a prohibition
against any assignment, license or transfer by operation of law.
12.

Other Terms.

12.1 Notice. All notices hereunder shall be in writing and shall be delivered
personally, by certified or registered mail or by recognized overnight courier addressed as follows:

To the Port:

To the Carnival Lines:

Port of Seattle
Attention: Cruise Operations
and Business Development Manager
P.O. Box 1209
2711 Alaskan Way
Seattle, WA 98111

Holland America Line N.V.
Princess Cruise Lines, Ltd
Carnival Cruise Lines, a division of
Carnival Corporation
450 Third Avenue West, Seattle, WA 98119
Attn: Robert Morgenstern, Senior Vice
President, Alaska Operations
and

With a Copy to:
Port of Seattle
Attention: General Counsel
P.O. Box 1209
2711 Alaskan Way
Seattle, WA 98111

With a Copy to:
Carnival Corporation Legal Department
24305 Town Center Drive
Santa Clarita, CA 91355
Attn: Daniel Howard
Deputy General Counsel

or to such other respective addresses as either party hereto may hereafter from time to time
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designate in writing. Notices shall be deemed delivered (i) when personally delivered; (ii) on the
third day after mailing when sent by certified or registered mail and the postmark affixed by the
United States Postal Service shall be conclusive evidence of the date of mail ing; (iii) on the first
business day after deposit with a recognized overnight courier if deposited in time to permit
overnight delivery by such courier as determined by its posted cutoff times for receipt of items
for overnight delivery to the recipient.
12.2
Joint and Several Liability. The Carnival Lines shall be jointly and severally
liable under this Agreement with respect to any amounts payable under this Agreement. It is
understood and agreed that for convenience the term "Carnival Lines" and associated verbs
are plural, but each of the companies constituting the Carnival Lines shall have all of the
benefits hereunder and shall be entitled to exercise any of the rights hereunder.

12.3 Insurance. The Carnival Lines shall provide the Port evidence of commercial
general liability insurance against claims for bodily injury, personal injury and property
damage arising out of the tenancy, use, occupancy or maintenance of the Smith Cove Cruise
Terminal and all areas appurtenant thereto as defined in this Agreement. The policy shall
include the Port as an additional insured and Carnival Lines insurance shall be primary and
non-contributory to any insurance the Port carries. The policy shall also contain a waiver of
subrogation in favor of the Port. The limits of coverage shall be no less than $5 million per
occurrence and $5 million in the annual aggregate, such limits permitted to be obtained
through a combination of primary and excess liability/umbrella cover The policy shall not
have specific exclusions for claims arising on docks, piers or wharves, nor any exclusions for
bodily injury or property damage that incur on or due to gangways, bridges, or passenger
loading bridges that are used to load and unload passengers between the cruise ships and
landside on Smith Cove Terminal. . The Carnival Lines shall provide the Port evidence of
automobile liability insurance on a combined single limit basis for bodily injury and property
damage for all owned, non-owned, rented or leased automobiles brought onto the Smith Cove
Cruise Terminal and all areas appurtenant thereto as defined in this Agreement.
12.3.1 The Carnival Lines shall provide the Port evidence of insurance
coverage as follows:
a.
Protection and indemnity coverage for each cruise ship that will dock and
operate out of Smith Cover Terminal and all areas appurtenant thereto as defined in this
Agreement. The protection and indemnity policy shall provide coverage against third party
claims for loss of life, injury, illness, and property damage, and coverage for wreck removal
and oil pollution for occurrences in which Carnival Cruise is the liable party to the incident
that caused the damages. Coverage limits per occurrence shall be no less than $10 million per
occurrence.
b.

First party coverage that shows coverage for the hull and vessel itself,

c.
Coverage for protection and indemnity as offered by Carnival Cruise’s entry
into one or more International Group P&I Clubs is acceptable to the Port.

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d.
The Port shall be provided with evidence of the above required insurance when
the Agreement commences and annually thereafter no later than ten (10) days from the date of
when the expiring insurance expired.
12.3.2 The Carnival Lines are responsible for ensuring that it meets any and
all insurance requirements relative to Revised Code of Washington Title 51 Industrial
Insurance, and, if applicable, the insurance requirements that pertain to the United States
Longshore and Harbor Worker’s Compensation Act and the Jones Act.

cancellation.

12.3.3 The Carnival Lines shall notify the Port of any mid-term insurance

12.3.4 Indemnification. The Port, its employees and agents shall not be liable
for any injury (including death) to any persons or for damage to any property regardless of
how such injury or damage be caused, sustained, or alleged to have been sustained by the
Carnival Lines or by others including, but not limited to, all persons directly or indirectly
employed by the Carnival Lines or any agents, contractors, or subcontractors of the Carnival
Lines, as a result of any condition (including existing or future defects in the Smith Cove
Cruise Terminal) or occurrence (including failure or interruption of utility service) whatsoever
related in any way to the Smith Cove Cruise Terminal and the areas adjacent thereto, or
related in any way to the Carnival Lines’ use or occupancy of the Smith Cove Cruise
Terminal and of areas adjacent thereto. The Carnival Lines agree to defend, indemnify and to
hold and save the Port harmless from all liability or expenses (including attorneys' fees, costs,
and all expenses of litigation) in connection with any such items of actual or alleged injury or
damage, except to the extent such injury or damage is caused by the negligence or intentional
conduct of the Port. The Carnival Lines expressly agree that their duty to defend and
indemnify the Port includes negligent acts which are concurrent, contributory, or both by the
Port, resulting in said damage or injury. However to the extent this Agreement is construed to
be subject to RCW 4.24.115, and where the injury or damage arises from the concurrent
negligence of the Port and the Carnival Lines, the Carnival Lines’ indemnity will only extend
to its negligence.
12.4 Captions. The captions in this Agreement are for convenience only and do not in
any way limit or amplify the provisions of this Agreement.
12.5 Governing Law: Venue. This Agreement shall be construed under the laws of
Washington. Exclusive jurisdiction and venue for any action relating hereto shall be in the state
or federal courts located in King County, Washington.
12.6 Attorneys’ Fees. In the event that either party shall be required to bring any
action to enforce any of the provisions of this Agreement , or shall be required to defend any
action brought by the other party with respect to this Agreement, and in the further event that one
party shall substantially prevail in such action, the losing party shall, in addition to all other
payments required therein, pay all of the prevailing party's actual costs in connection with such
action, including such sums as the court or courts may adjudge reasonable as attorneys' fees in
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the trial court and in any appellate courts.
12.7
Invalidity of Particular Provisions. If any term or provision of this Agreement or
the application thereof to any person or circumstance shall, to any extent, be invalid or
enforceable, the remainder of this Agreement or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or unenforceable shall not
be affected thereby and shall continue in full force and effect.
12.8
Amendments. No modification or amendment of this Agreement shall be valid
or effective unless evidenced by an agreement in writing signed by both parties.
12.9 Conflicts or Inconsistencies. In the event the provisions of this Agreement
conflict with or are inconsistent with any other Port agreement or Port requirement regarding
use of the Smith Cove Cruise Terminal, the provisions of this Agreement shall control.
12.10 Port Management Agreement. With respect to any portion of this Agreement that
pertains to Washington State-owned aquatic lands under the Port’s management, this Agreement
is specifically subject and subordinate to the terms and conditions of the Port Management
Agreement dated November 1, 1997 between the Washington State Department of Natural
Resources (DNR) and the Port of Seattle, which Port Management Agreement is hereby
incorporated by this reference, any future Port Management Agreement between the Port and
DNR that is executed during the Term of the Agreement, which will be provided to the Carnival
Lines upon request.
12.11 Security. Carnival Lines shall, upon execution of this Agreement, obtain and
deliver to the Port a good and sufficient corporate surety company bond, irrevocable stand-by
letter of credit, or other security equal to THREE MILLION AND NO/100 DOLLARS
($3,000,000.00) (hereinafter referred to as “Security”), to secure the full performance under this
Agreement, including the payment of all fees and other amounts no or hereafter payable to the
Port hereunder. The amount, form, provisions and nature of the Security, and the identity of the
surety or other obligor thereunder, shall at all times be subject to the Port’s approval. The
Security shall remain in place at all times throughout the full term of this Agreement. If the
Security is in a form that periodically requires renewal, the Carnival Lines must renew the
Security not less than 45 days before the Security is scheduled to expire. No interest shall be
paid on the Security and the Port shall not be required to keep the Security separate from its
other accounts. Not trust relationship is created with respect to the Security. The Port may apply
all or part of the Security to any unpaid sum due hereunder, or to cure other defaults of Carnival
Lines. If the Port uses any part of the Security, the Carnival Lines shall restore the Security to
its then-currently required amount within fifteen (15) days after the receipt of the Port’s written
request to do so. The retention or application of such Security by the Port pursuant to this
Section does not constitute a limitation on or waiver of the Port’s right to seek further remedy
under law or equity. The Security is a part of the consideration for the execution of this
Agreement.

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12.12 COMPLIANCE WITH ALL LAWS, ETHICAL STANDARDS AND ANTICORRUPTION. The parties agree to abide by their respective ethical standards, practices and internal
policies. Each party will comply with all local, state, federal, and other laws, rules, regulations, or other
requirements applicable to its operations, including those relating to environmental compliance, worker
safety, anti-corruption, economic sanctions, trade restrictions, labor and human trafficking.

PORT OF SEATTLE

HOLLAND AMERICA LINE N.V.

By:_________________________________

By:

____________________________________

__________________________________
Its:

Its:_________________________________
PRINCESS CRUISE LINES, LTD

CARNIVAL CORPORATION

By:_________________________________

By:_________________________________

____________________________________

Jan Swartz

Its:_________________________________

Its: EVP, Strategic Operations

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EXHIBIT A
The Carnival Lines makes the following sustainability, equity, and workforce development
commitments:
•

The Carnival Lines will continue to provide ongoing leadership and engagement in the Green
Corridor.

•

The Carnival Lines will use reasonable commercial efforts to enter into multi-party shore
power agreements with all other cruise lines at Terminal 91, allowing access to any
proprietary equipment by December 31, 2024 with entities who have made requests, or within
one hundred twenty (120) days of any future requests. Charges relating to access to such
shore power equipment will be on a cost-recovery basis as outlined in a Shore Power Use
Agreement between Carnival and any other operating line and must be made available in a
non-discriminatory manner. The Shore Power Use Agreement is inclusive of use, repair and
maintenance costs to be proportionally shared among users based on call volume. Third party
cruise lines are directly responsible for their own equipment costs, user personnel costs and
modifications needed for use where not required by Carnival. Third Party users will also
contract with an Authorized Contractor for shoreside services necessary to connect/disconnect
cruise ships and ongoing monitoring of shore power equipment. The Carnival Lines will
negotiate in good faith with the Port regarding a potential sale of the Carnival owned shore
power equipment at Terminal 91 at fair market value prior to the easements relating to such
shore power equipment expiring in 2029.

•

Additionally, it is the intent of the Port of Seattle to require all cruise vessels (from all brands)
to plug in to shore power in the future.

•

The Carnival Lines will continue to partner with the Department of Ecology and others on
public engagement and policy making regarding EGCS operations and wash water.

•

The Carnival Lines will continue to participate in the ECHO and Quiet Sound programs.

•

The Carnival Lines will continue to participate in and adhere to the Port’s Stormwater Best
Management Practices.

•

The Carnival Lines will communicate to booked cruise guests through pre-cruise travel
communications how to choose lower GHG alternatives for transport to and from the cruise
terminals, and will coordinate with the Port on standards relating to taxis, TNCs, and other
transportation options.

•

The Carnival Lines will provide incentives for ground handlers who use lower GHG
alternative forms of transportation, and require that all motorcoaches in Seattle have a 2007
model year engine or newer, or with emission controls that achieve the equivalent level of air
quality.

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•

If Carnival Lines contracts directly with stevedores at Smith Cove Terminals, the Carnival
Lines will encourage stevedores use of low emission equipment with a zero emission
shoreside goal by 2030. Carnival lines will partner with the Port, Stevedore and other parties
to achieve this 2030 goal.

•

The Carnival Lines will work with local non-profits on donations of reusable goods.

•

Twice per cruise season on mutually convenient dates and times, the Carnival Lines will
provide ship tours for education and workforce development purposes.

•

The Carnival Lines will develop a Responsible Sourcing pilot program for Seattle that
promotes small, diverse, disadvantaged, tribal and local suppliers, and focuses on capability
building with key suppliers.

•

The Carnival Lines will use reasonable efforts to partner with Maritime focused non-profit
entities to assist in creating curriculum and experiential field-based learning opportunities and
internships for students as part of Maritime-focused workforce development programs.

•

Carnival Lines will collaborate with the Port on Anti-human trafficking efforts and will sign
on to the Port Allies Against Human Trafficking Pledge.

•

The Carnival Lines will participate in an annual review of their efforts with respect to
diversity with ground handlers, and participate to a reasonable extent in programs related to
equity.

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EXHIBIT B
Carnival Lines Reporting Requirements
Prior to the beginning of the Season, the Carnival Lines will submit the following information for
each vessel scheduled to call at the Port of Seattle:
•
•
•
•
•

Shore power capability status per ship
Advance Wastewater Treatment system type
Exhaust Gas Cleaning System by type and usage
Other emission reduction technology and/or innovations on board each vessel
the Carnival Lines will identify which of their vessels currently have ALS or other
noise reduction technology, as well as planned retrofits

Weekly during the season, The Carnival Lines will submit the following information for the
previous week for each vessel calling at the Port of Seattle.
•

•
•

Shore power connection per call, including whether a ship connected, start time of
connection, any times of disconnection, duration of connection, power (kw), and
energy (kWh) consumed during connection and the total utility costs per shore
power connection. If Connection failed, include documentation and explanation
of reasons for failure to assist in problem solving.
Fuel type(s) used onboard, per vessel, and fuel specifications (e.g., origin, sulfur
content, and other criteria).
Fuel consumption quantity by fuel type and use (e.g. main, auxiliary, boiler operating
engines, pilot fuel, etc.), including fuel type switching activity.

ANNUAL REPORTS: In addition to the information above, annually, the Carnival Lines will
submit an annual report with the following information, by December 1st of each cruise season.
Such annual report will include:
1. Quiet Sound participation as further described in Exhibit A
2. Other emission reduction technology and/or innovations on board each vessel
3. Provisions sourcing via local, small, diverse, WMBE and disadvantaged businesses,
as further described in Exhibit A.
4. Disaggregated organizational demographics by hierarchy, shipboard and land based
5. Any additional metrics requested as mutually agreed. .
6. The Carnival Lines will report progress on food waste and single use plastics
reduction efforts via annual sustainability reporting, and regionally communicate such
efforts.
7. To measure GHG emissions and progress toward GHG reduction targets, the Carnival
Lines agrees to share data on total GHG emissions and GHG emissions intensity
(GHG emission per-available-lower-bed capacity) as needed to contribute to
emissions inventories (including Port of Seattle GHG inventories) that may occur on
an annual basis.

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8. On an annual basis the Carnival Lines will meet with the Port of Seattle staff to
evaluate home-porting operations and strategies to increase the use of shore power
toward a goal of achieving 100-percent use per shore-power capable call.
9. On at least an annual basis, the Carnival Lines will participate, with Port of Seattle
and partners, in evaluating, planning and/or developing strategies to reduce emissions
from ocean going vessels in accordance with the Northwest Ports Clean Air Strategy
and in support of Port of Seattle’s Century Agenda and greenhouse gas emission
reduction goals.
10. On at least an annual basis, Carnival Lines will work with Port of Seattle and partners
to identify joint sustainability opportunities, projects, and programs.

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