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California Regional Water Quality Control Board J San Diego Region Over 50 Years Serving San Diego, Orange, and Riverside Counties Ree~iren~tf thedo~envixtlnmetttalmwamlfqr Qutstanding A cjtiexementfrttrrlu ~Al t L F n Matthew Rodriquez 9174 Sky Park Court, Suite 100, San Diego, California 921234353 Edmund G. Brown Jr. Seeretaryfor (858) 467-2952 FAX (858) 571-6972 Governor Environmental Protect/on http: //www. waterboards.ca.gov/sandiego January 26, 2012 CERTIFIED MAIL RETURN RECEIPT REQUESTED Mr. Andrew Fichthorn 7010 1060 Q000 4952 9703 SeaWorld LLC 500 Sea World In response refer to: San Diego, CA 92109 dbradford:256121 SETTLEMENT OFFER NO. R9-2012-0008: OFFER TO PARTICIPATE IN EXPEDITED PAYMENT PROGRAM RELATING TO VIOLATIONS OF NPDES PERMIT NO. R9-2005-0091, SEAWORLD LLC, SEAWORLD SAN DIEGO FACILITY Mr, Fichthorn: This letter notifies SeaWorld Parks 8 Entertainment, Inc. a Delaware Corporation, SeaWorld LLC (Permittee) of alleged violations of Order No. R9-2005-0091, Waste Discharge Requirements and NPDES Permit for Sea World, inc. - SeaWorid San Diego, Discharge to San Diego Mission Bay, and allows the Permittee to participate in the California Regional Water Quality Control Board, San Diego Region's (San Diego Water Board) Expedited PaymerIt Program for Effluent and/or Reporting Violations (Expedited Payment Program) to address liability that may be assessed pursuant to California Water Code sections 13385 and 13385.1. This offer applies to two violations of the permitted effluent limits for ammonia on May 24, 2011 that are subject to mandatory minimum penalties (Exhibit A). Since April 13, 2005, there have been numerous violations of effluent limitations at the facility, inciuding three exceedances of Ammonia, six exceedances of Enterococcus, and one exceedance of Total coliform. Furthermore, there have been multiple months in which required sampling was not reported. The constituents not sampled have included ph, Total coliform, Fecal Coliform, Enterococcus, and Total Residual Chlorine. SeaWorld LLC is strongly urged to take all necessary actions to prevent future violations of its NPDES effluent limitations and reporting requirements, If mandatory minimum penalties are not sufficien to compel compliance and corrective actions, we may not offer the Expedited Payment Program and will instead recornrnend that our Board impose discretionary penalties above the statutory minimum. California Environncental Protection Agency -~ Recyeled Paper

Andrew Fichthorri SeaWorld San Diego -2 January 26, 20'I2 VIOLATIONS SUBJECT TO THIS OFFER: The San Diego Water Board alleges that the Permittee has violated the effluent limitations identified in Exhibit "A." The Permittee will have the opportunity to address the alleged violations as discussed below. STATUTORY LIABILITY: Subdivisions (h) and (i) of Water Code section 13385 require the assessment of a mandatory minimum penalty of three thousand dollars ($3,000) for specified serious and chronic effluent limit and reporting violations. However, the Permittee is subject to discretionary administrative civil liability of up to ten thousand dollars ($10,000) for each day in which the violation occurs, and ten dollars ($10) for each gallon discharged but not cleaned up in excess of 1,000 gallons, plus staff costs. These mandatory minimum penalties and discretionary administrative civil liabilities may be assessed by the San Diego Water Board beginning with the date that the violations first occurred." The formal enforcement that the San Diego Water Board uses to assess such liability is an administrative civil liability complaint, although the San Diego Water Board may instead refer such matters to the Attorney General's Office for prosecution. If referred to the Attorney General for prosecution, the Superior Court may assess up to twenty-five thousand dollars ($25,000) per violation. In addition, the Superior Court may assess up to twenty-five dollars ($25) per gallon discharged but not cieaned up in excess of 1,000 galions, plus staff costs. O FFER TO PARTICIPATE IN EXPEDITED PAYMENT PROGRAM: The Permittee can avoid the issuance of a formal enforcement action and settle the alleged violations identified in Exhibit A by participating in the San Diego Water Board's Expedited Payment Program. Details ot the proposed settlement are described below and addressed in the enclosed documents. The San Diego Water Board makes this Conditional Offer to promote resolution of these violations. The Permittee may accept this offer, waive the Permittee's right to a hea~ing, and pay the mandatory minimum penalty of $6,000 for the violations described in Exhibit A. If the Permittee elects to do so, subject to the conditions below, the San Diego Water Board will accept that payment in settlement of any enforcement action that would otherwise arise out of the violations identified in Exhibit A. " Please note that there are no statutes of limitation that apply to administrative proceedings to assess mandatory minimum penames. See City of Oakland v. Pubiic Employees'Retirement System (2002) 95 Cal.App.4'" 29, 48; 3 Witkin, Cai. Procedure (4'" ed. 1996) Actions $405(2), p, 510.) California Environmental Protection Agency Recycted Paper

SeaWorfd San Diego -3 January 26, 2012 Accordingly, the San Diego Water Board wilt forego issuance of a formal administrative complaint, will not refer the violations to the Attorney General, and will waive its right to seek additional discretionary civil liabilities for the violations identified in Exhibit A. The Expedited Payment Program does not address or resolve liability for any violation that is not specifically identified in Exhibit A regardless of the date that the violation occurred. PERMlTTEE'S OPTIONS FOR RESPONSE TO OFFER: 1. If you accept this offer, please complete and return the enclosed "Acceptance of Conditional Resolution and Waiver of Right to Hearing; (proposed) Order" (Acceptance and Waiver, Exhibit B) on or before February 16, 2012. 2. If you choose to contest any of the violations alleged in Exhibit A, please identify the specific violation and the basis for the challenge (factual error, affirmative defense, etc.) on or before the due date specified above. The San Diego Water Board will evaluate the contested violation and take one of two actions: a. The San Diego Water Board will determine that the violation is not supported, expunge the alleged violation, take no further action against the Permittee for the alleged violation, and notify the Permittee of that determination. The Permittee will be given thirty (30) days from the date of receipt of the San Diego Water Board staff determination to complete and return the Acceptance and Waiver for the remainder, if any, of the violations; or b. The San Diego Water Board staff will determine that the alleged violation is meritorious and will notify the Permittee of that determination. The Permittee will be given thirty (30) days from the date of receipt of the San Diego Water Board staff determination to complete and return the Acceptance and Waiver. 3. If you choose not to make a payment in response to the San Diego Water Board staft" s determination, you should expect to be contacted regarding formal enforcement action that will be initiated with regard to the contested violations. In a formal enforcement action, the liability amount sought and/or imposed may exceed the liability amount set forth in this Conditional Offer. Moreover, the cost of enforcement is a factor that will be considered in assessing the liability amount. California Environmental Protection Agency Recycled Paper

Andrew Fichthorn SeaWorld San Diego -4 January 26, 2012 CONDITIONS FOR SAN DIEGO WATER BOARD ACCEPTANCE OF RESOLUTION: Federal regulations require the San Diego Water Board to publish and allow the public thirty (30) days to comment on any settlement of an enforcement action addressing NPDES permit violations (40 C.F.R. section 123.27(d)(2)(iii)). Upon receipt of the Permittee's Acceptance and Waiver, the San Diego Water Board staff will publish a notice of the proposed resolution of the violations. If no comments are received within the 30-day comment period, and unless there are new material facts that become available to the San Diego Water Board, the Executive Officer will execute the Acceptance and Waiver as a stipulated order assessing the uncontested mandatory minimum penalty amount pursuant to Water Code sections 13385 and 13385.1. If, however, significant comments are received in opposition to the settlement, this Offer may be withdrawn. In that case, the Permittee's waiver pursuant to the Acceptance and Waiver will also be treated as withdrawn. in that case, the violations will be addressed in a liability assessment proceeding. At the liability assessment hearing the Permittee will be free to make arguments as to any of the alleged violations, and the Permittee's agreement to accept this conditional offer will not in any way be binding or used as evidence against the Permittee. The Permittee will be provided with further information on the liability assessment proceeding. In the event the Acceptance and Waiver is executed by the Executive Officer, full payment of the assessed amount shall be due within ten (10) calendar days after the Permittee's receipt of the notice of the Executive Officer's execution. In accordance with Water Code section 13385(n)(1), funds collected for violations of effluent limitations and reporting requirements pursuant to section 13385 shall be deposited in the State Water Pollution Cleanup and Abatement Account. Accordingly, the $6,000 liability shall be paid by cashiers or certified check for $6,000 made out to the "State Water Pollution Cleanup and Abatement Account." Failure to pay the full penalty within the required time period may subject the Permittee to further liability. A summary of this offer is enclosed as Exhibit C. California Environmental Protection Agency Recycled Paper

-Andrew~ichNorn SeaWorld San Diego -5 January 26, 2012 Should you have any questions about this Conditional Offer or Notice of Violation, please contact Darren Bradford at (858) 637-7137 or DBradford waterboards.ca. ov. Respectfully, JAMES G. SMITH Assistant Executive Officer San Diego Regional Water Quality Control Board JGS:jch:dib Enclosures: 1. Exhibit A: Violations Subject to This Offer 2, Exhibit B: Acceptance of Conditional Resolution and Waiver of Right to Hearing; (proposed) Order 3. Exhibit C: Settlement Offer Summary California Environmental Protection A gency Reaycled Paper

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'.' Exhibit B SeaWorld LLC Settlement Offer No. R9-2012-0008 NPDES Permit No. CA0107336 ACCEPTANCE OF CONDITIONAL RESOLUTION AND WAIVEROF RIGHTTO HEARING r o osed ORDER By signing below and returning this Acceptance of Conditional Resolution and Waiver of Right to Hearing (Acceptance and Waiver) to the California Regional Water Quality Control Board (San Diego Water Board), SeaWorld Parks 8 Entertainment, Inc. a Delaware Corporation, SeaWorld LLC (Permittee) hereby accepts the "Offer to Participate in Expedited Payment Program" and waives the right to a hearing before the San Diego Water Board to dispute the allegations of violations described in the Settlement Offer, which is attached hereto as Exhibit "A" and incorporated herein by reference. The Permittee agrees that the Settlement Offer shall serve as a complaint pursuant to Article 2.5 of the California Water Code and that no separate complaint is required for the San Diego Water Board to assert jurisdiction over the alleged violations through its Chief Prosecutor. The Permittee agrees to pay the penalties required by Water Code section 13385, in the sum of $6,000 (Expedited Payment Amount), which shall be deemed payment in full of any civil liability pursuant to Water Code sections 13385 and 13385.1 that otherwise might be assessed for the violations described in the Settlement Offer. The Permittee understands that this Acceptance and Waiver waives the Permittee's right to contest the allegations in the Settlement Offer and the amount of civil liability for such violations. The Permittee understands that this Acceptance and Waiver does not address or resolve liability for any violation that is not specifically identified in the Settlement Offer. Upon execution by the Permittee, the completed Acceptance and Waiver shall be returned to: California Regional Water Quality Control Board San Diego Region 9174 Sky Park Court, Suite 100 San Diego, CA 92123 ATTN: dbradford:256121 The Permittee understands that federal regulations set forth at title 40, Code of Federal Regulations, section 123.27(d)(2)(iii) require the San Diego Water Board to publish notice of and provide at least 30 days for public comment on any proposed resolution of an enforcement action addressing NPDES permit violations. Accordingly, this Acceptance and Waiver, prior to execution by the Executive Officer, will be published as required by law for public comment.

Exhibit B SeaWorld LLC Settlement Offer No. R9-2012-0008 NPDES Permit No. CA0107336 If no comments are received within the notice period that cause the Executive Officer to question the Expedited Payment Amount, the Executive Officer will execute the Acceptance and Waiver. The Permittee understands that if significant comments are received in opposition to the Expedited Payment Amount, the offer on behalf of the San Diego Water Board to resolve the violations set forth in the Settlement Offer may be withdrawn. In that circumstance, the Permittee will be advised of the withdrawal and an administrative civil liability complaint may be issued and the matter may be set for a hearing before the San Diego Water Board. For such a liability hearing, the Permittee understands that this Acceptance and Waiver executed by the Permittee will be treated as a settlement communication and will not be used as evidence in that hearing. The Permittee further understands that once the Acceptance and Waiver is executed by the Executive Officer, the fuil payment required by the deadline set forth below is a condition of this Acceptance and Waiver. In accordance with Water Code section 13385(n)(1), funds collected for violations of effluent limitations and reporting requirements pursuant to section 13385 shall be deposited in the State Water Pollution Cleanup and Abatement Account. Accordingly, the $6,000 liability shall be paid by a cashiers or certified check for $6,000 made out to the "State Water Pollution Cleanup and Abatement Account." The payment must be submitted to the San Diego Water Board no later than ten (10) calendar days after the date the Permittee receives written notice that the Executive Officer has executed this Acceptance and Waiver. I hereby affirm that I am duly authorized to act on behalf of and to bind the Permittee in the making and giving of this Acceptance and Waiver. SeaWorld Parks 8 Entertainment, inc. a Delaware Corporation, SeaWorld LLC By: ( Sign arne) (Date) D hn ( B e, (Printed or typed name) gjf g Db.+ IT IS SO ORDERED PURSUANT TO WATER CODE SECTION 13385 Date: By: David W, Gibson Executive Officer

California Regional Water Quality Control Board San Diego Region Over 50 Years Serving San Diego, Orange, and Riverside Counties Recipient of the 2004 Environmental Award for Outstanding Achievement from U.S. EPA isa P Matthew Rodriquez 9 l74 Sky Park Court, Suite 100, San Diego, California 921234353 Edmund G. Brown Jr. Secretary for (858) 467-2952 ' FAX (858) 57l-6972 Governor Environrnenta! Protection http: //www.wate*oards.ca.gov/sandiego Exhibit C Summary of Settlement Offer No. R9-2012-0008 Enforcement of il/tlandatory Minimum Penalties for NPDES Effluent Limit Violations Rater Code section 13385(h) and (i) You have until February 16, 2012 to act or face more penalties. Questions: Contact Darren Bradford at (858) 637-7137 or DBradford waterboards.ca. Ov This is a plain language summary of the attached Settlement Offer to Participate in an Expedited Payment Program for Violations of the NPDES permit for SeaWorld Parks 8 Entertainment, Inc. a Deleware Corporation, SeaWorld LLC, Sea World Facility. SeaWorld Parks 8 Entertainment, Inc. has exceeded effluent limitations established in Order No. R9 2005-0091. Two such violations are subject to mandatory minimum penalties of $3,000 each pursuant to Water Code section 13385(h) and (i). Consequently, we are taking a monetary penalty enforcement action for $6,000. However, instead of pursuing a formal enforcement complaint with penalties higher than the mandatory minimum, we are offering you the opportunity to participate in an Expedited Payment Program to resolve the violations, You have three options to respond: 1. Accept the Expedited Payment Program offer by agreeing to pay a settlement of $6,000. This is the fastest and most certain way to get closure on this enforcement action. If you choose this option, you must sign and submit the Acceptance and Waiver Form, attached to the Settlement Offer letter, by February 16, 2012. The form provides submittal instructions. Final closure on this action is only possible after ultimate submission of the settlement amount. 2. Contest the violations by submitting in writing the basis of your challenge with supporting evidence. For example, submit evidence that the alleged violations are inaccurate or meet the criteria for exceptions to mandatory minimum penalties described in Water Code section 13385(j), If you choose this option, you must submit your challenge by February 16, 2012. We will review your challenge, and if we agree with you, we will notify you in writing that our enforcement action has been terminated. However, if we do not agree with you, we will prepare a formal enforcement complaint at a higher dollar amount than the settlement offer of $6,000. To avoid the latter, we urge you lo contact Darren Bradford (see above) as soon as possible so we can assist if your challenge is valid, 3. Reject the Expedited Payment Program offer by not responding or submitting your rejection in writing by February 16, 2012. In either case, we will prepare a formal enforcement complaint at a higher dollar amount than the settlement offer of $6,000. The date of submittal or failure to submit the Acceptance and Waiver form will affect the recommended penalty amount. California Environmental Protection Agency -~ Recycled Paper a(p