UNIVERSITY OF CALIFORNIA, BERKELEY BERKELEY DAVIS - IRVINE - LOS ANGELES MERCED - RIVERSIDE 0 SAN DIEGO - SAN FRANCISCO 0 SANTA BARBARA SANTA CRUZ 235 California Hall [500 OFFICE OF THE VICE CHANCELLOR, Berkeley. CA 94120-1500 ADMINISTRATION AND FINANCE E-MAIL: vcal@erkeley.edu September 12, 2012 Re: Memorandum of Understanding Regarding Cal Rugby Dear Bud: This Memorandum of Understanding will memorialize the understanding between the Cal Rugby Advisory Board and the University of California, Berkeley (?University? or ?Cal?) regarding funding and operation of the Cal Intercollegiate Rugby Program (?Rugby? or ?Cal Rugby?). CRAB is an unincorporated association of supporters of Cal Rugby. CRAB and the University share the goal of maintaining Rugby?s position as a varsity sport in good standing in the University?s Department of Intercollegiate Athletics under conditions that will allow continuation of Rugby?s long tradition of competitive excellence. In addition, CRAB and the University have a common goal to maintain and improve Witter Rugby Field and it is the University?s intent that WRF will remain dedicated primarily to the use of Cal Rugby. Toward this end, CRAB and supporters of Cal Rugby are endeavoring to raise suf?cient funds so that the Rugby program can be self-supporting, meaning that the combination of commercial Rugby revenues, donations to Rugby, and income from endowments dedicated to Rugby will be suf?cient to cover the direct and indirect costs of Cal Rugby?s operations. Both CRAB and the University acknowledge the desire to raise sufficient ?mding to provide Rugby players with benefits commensurate with comparable varsity sports. In addition, CRAB and supporters of Cal Rugby have made generous contributions to support the Cal Women?s Lacrosse and Women?s Gymnastics programs and will endeavor to raise funds to provide continuing support for those programs. In recognition of the extraordinary commitment and efforts of CRAB and Rugby?s supporters, the University intends to maintain Rugby?s varsity status and to implement certain conditions regarding use of facilities and funds for the term of this Memorandum on condition that the ?mding goals for Rugby, Women?s Lacrosse and Gymnastics are achieved, as set forth below. 1 . Term and Subsequent Agreements This MOU shall remain in effect until the conclusion of the 2020-21 Fiscal Year. If the funding goals set forth in Paragraph 2, below, are met for Fiscal Years 2012-13 through 2018-19, beginning no later than December 1, 2019, the parties agree to enter into good faith negotiations to reach a successor agreement to address subsequent ?nancial support of Cal Rugby and Women?s Lacrosse and Women?s Gymnastics, Cal Rugby?s varsity status, extension of the provisions of this Agreement governing the use and maintenance of Witter Rugby Field, and any other related issues. 2. undraising The University actions set forth in paragraphs 3, 4, 5 and 8 below are contingent on CRAB and other supporters of Cal Rugby meeting the following ?mdraising goals: - Suf?cient funds shall be raised to support 100% of the direct and indirect costs of the Rugby program. Direct costs include, but are not limited to salaries, team travel, equipment, recruiting, camp expenses, maintenance of Witter Field, medical expenses for student athletes and general supplies. Indirect costs for the Rugby program will be calculated using the same methodology as is used to calculate indirect costs for all other intercollegiate sports programs at Cal. 0 In addition, as noted above, Rugby and CRAB have agreed to raise funds to support Cal Women?s Lacrosse and Women?s Gymnastics at the level of $150,000 per year. However, in recognition of the heavy demands placed on the rugby community, it is agreed that this payment will be phased in as follows: 0 FY 2012?13: $35,000 0 FY 2013-14: $75,000 0 FY 2014-15: $110,000 0 FY 2015-16 through FY 2020-21: $150,000 per year 0 In determining whether the funding goals set forth in this paragraph have been met, the following sources will be considered: 0 Distributions from all new or existing endowments and term endowments (whether held by the University of California, Berkeley Foundation or the Regents of the University of California) to the extent expressly established for the bene?t of Cal Rugby (a list of existing endowments is attached as Exhibit The annual account, ?Friends of Cal Rugby,? and all funds from the ?Every Man Pledge;? All commercial Rugby revenues payable to Rugby; 0 Any new ?mding mechanism and/or creative ?nancial bene?ts to the extent expressly established for the bene?t of Cal Rugby; 0 All grants or gifts, to the extent expressly made for the bene?t of Cal Rugby; 0 Distributions from the California Intercollegiate Athletics Fund term endowment. 3. Varsity Status Contingent on satisfaction of the fundraising goals set forth in section 2, above, Rugby will remain a varsity sport in the Department of Intercollegiate Athletics during the term of this MOU. 4. Operational Issues Contingent on satisfaction of the ?mdraising goals set forth in paragraph 1, above, during the term of this MOU: 0 Rugby will have priority use of the Witter Rugby Field for training and competitions in the fall and winter/spring seasons. 0 Rugby acknowledges that WRF will be used for other activities including evening intramurals and special events during the fall and spring, intercollegiate and recreational summer camps and occasional use by club teams and other intercollegiate teams throughout the year. 0 It is acknowledged by all parties that WRF is ?rst and foremost a rugby ?eld and no permanent structural changes or permanent ?eld markings inconsistent with its continued use as a Rugby ?eld will be made. 0 The University has prepared a Master Development Plan for Witter Rugby Field (?Master Plan?). The University agrees to work in good faith with CRAB and other Rugby supporters to develop and implement the Master Plan, and the University will use best efforts to secure all approvals needed to implement the Master Plan consistent with overall resource constraints. It is understood that deveIOpment and implementation of the Master Plan is contingent on CRAB and Rugby?s supporters raising suf?cient funds to cover all costs of Master Plan development and implementation. The provisions of this Paragraph relating extended under to the terms of any successor agreement negotiated pursuant to Paragraph 1, above. 5. undraising Assistance The Department of Intercollegiate Athletics will work with Rugby in its fundraising efforts to develop, execute campaigns and events designed to secure additional gifting initiatives. This includes, but is not limited to the following: 0 Developing campaigns in concert with Rugby, - Execution and ful?llment of those campaigns and all detailed reporting. 6. One-time Credit The University acknowledges the ?nancial costs incurred by Rugby over the past two years due to loss of access to Witter Rugby Field which resulted in Rugby incurring additional travel costs and loss of ticket and concession revenues. The University will grant Rugby a onetime credit of $130,000 which shall be placed in a plant fund in FY 2012-13 and used for Witter Rugby Field enhancements. 7. Use of Funds Donated to bene?t Cal Rugby Under campus policy, all contributions, including gifts to ?Friends of Cal Rugby? are charged a generally applicable administrative fee to offset the cost of ?indraising and administration. In addition, under campus policy, the University holds each gift/payment to endowed funds with the UC Berkeley Foundation or UC Regents in a short?term interest account for six months prior to the gift/payment being invested in the Foundation?s general endowment pool. Except for generally-applicable administrative assessments such as the ones described in this paragraph, all gifts and distributions ?'om endowments expressly donated for the bene?t of Cal Rugby will be available for the use of Cal Ruby consistent with the applicable gift terms. Nothing in this MOU shall be interpreted either to alter the terms of any gift or to obligate the University to use gift or endowment ?mds for the support of Rugby unless that purpose is expressly set forth in the gift terms. 8. Financial Statements and Budget arry-overs Quarterly, the University will provide the Head Coach of Cal Rugby and CRAB representatives with a copy of detailed ?nancial statements on all revenues and expenses as they pertain to Rugby, including information on ?term? and ?permanent? endowment payouts, gifts and all commercial revenues. University representatives will meet with the Head Coach of Cal Rugby and CRAB representatives to discuss these reports if and when asked on a quarterly basis. If there is a budget surplus or carry-over funds in the Cal Rugby budget at the end of any given year, it will ?ow to either next year?s annual budget and/or to an endowment or ?md functioning as endowment for the bene?t of Cal Rugby. 9. No Third Party Bene?ciaries Nothing in this MOU, express or implied, is intended to or shall confer upon any other person any right, bene?t or remedy of any nature whatsoever or by reason of this MOU. I am delighted that we have been able to arrive at an understanding regarding these matters and am con?dent that our efforts will result in continued competitive success and ?nancial sustainability of Cal?s great Rugby program. ?2?7 ,4 LACK inf/m, Wilton We Lyons Date Vice Chancellor, Administration and Finance Rugby designee and CRAB Chairman University of California, Berkeley cc: Sandy Barbour, Director of Athletics