HomeMy WebLinkAboutAD07-300 - Original - Thunderbird Hockey Enterprises, LLC - License Agreement - 08/07/2007 LICENSE AGREEMENT
By and between
CITY OF KENT
and
THUNDERBIRD HOCKEY ENTERPRISES,LLC
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TABLE OF CONTENTS
Page
ARTICLE 1 AGREEMENT DEFINITIONS...............................................................................2
ARTICLE 2 REPRESENTATIONS AND WARRANTIES........................................................6
2.1 Representations and Warranties of Team................................................................6
2.2 Representations and Warranties of City ..................................................................7
ARTICLE 3 CONSTRUCTION OF CENTER............................................................................8
3.1 Obligation to Construct............................................................................................8
3.2 Center Description .............................................................................................. .8
3.3 Program Development.............................................................................................9
3.4 Scheduling............................................................................................................. 10
3.5 Budget.. ...................................................................................... ..........................10
3.6 Schematic Design...................................................................... . . . ......................11
3.7 Selection of GC/CM ..............................................................................................11
3.8 Design Completion................................................... ....................................... .12
3.9 Project Cost Calculation........................................... ........................................... 13
3.10 Construction . . . ............................................................................. ................13
3.11 Project Completion................................................................................................15
ARTICLE 4 TERM AND LICENSE........................................................................................ 15
4.1 Term; Performance Standard ................................................. ... . . ......................15
4.2 Effective Date ...................................................................................................... 17
4.3 License...................................................................................................................17
ARTICLE5 LICENSE FEES.....................................................................................................17
5.1 License Fees ..........................................................................................................17
5.2 License Fees for Hockey Events........................................................................ 17
5.3 Reimbursement of Costs..................................................................................... 18
5.4 Facility Fee ..........................................................................................................18
5.5 Box Office..............................................................................................................19
ARTICLE 6 CENTER REVENUES..........................................................................................19
6.1 Concessions............................................................................................................19
6.2 Hockey-Event/In-Arena Advertising.................................................................... 19
6.3 Scoreboard Advertising ........................................................................................ 20
6.4 Center Advertising . ..............................................................................................21
6.5 Center Naming Rights..................................................... . .................................. .22
6.6 Suites......................................................................................................................23
6.7 Club Seats ............................................................................................................ .26
6.8 Premium Reserved Parking....................................................................................26
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ARTICLE7 TEAM FACILITIES..............................................................................................27
7.1 Use and Occupancy of Team Facilities ............ . ..................................................27
7.2 Construction of Team Facilities and Improvements..............................................27
7.3 Janitorial Services in Team Facilities; No Additional License Fees .....................27
ARTICLE 8 USE OF CENTER BY TEAM-GENERAL........................................................27
8.1 Scheduling-Regular Season Games ....................................................................27
8.2 Scheduling-Playoff Games...... . . . .....................................................................29
8.3 Scheduling-Hockey Events.................................................................................29
8.4 Training Camp.......................................................................................................29
8.5 Hockey School.......................................................................................................30
8.6 Practice Times........................................ . ............. .. . ..................................... . .30
ARTICLE 9 USE OF CENTER BY TEAM-GAME DAY.....................................................31
9.1 Use of Game Day Facilities...................................................................................31
ARTICLE 10 CITY'S RIGHTS AND OBLIGATIONS..............................................................32
10.1 Maintenance and Provision of Facilities................................................................32
102 Team's Remedies ........... . . . ................................................................. .32
10.3 Exclusive Rights to Hockey Events.......................................................................33
10.4 Loading Zone and Buses........ . .............................. . ......................................... 33
10.5 Center Personnel....................... ............................... . . ................................... . . 34
10.6 Maintenance of Team's Equipment......................... .. ....................................... . 34
10.7 Dasher Board System.......... . ............................................................................. 34
10.8 Inspection, Repair and Improvement of the Team Facilities and the Center.........34
10.9 Broadcast Advertising Time......... . ... . .... ... . . .............................. . . . ..... ...... 35
ARTICLE 11 TEAM'S RIGHTS AND OBLIGATIONS............................................................36
11.1 Ticketing.................... . . .......................................................................................36
11.2 Novelties, Etc.........................................................................................................36
11.3 Under Ice Displays....................... .........................................................................37
11.4 Appointment of Center Manager and Concessionaire...........................................37
11.5 Team Parking............................................................ ............................................37
11.6 Preferred Parking......................................................... ........................................ 37
11.7 Media Rights..... . .............. ...................................................................................38
11.8 Telephone................................................................ . . ...................................... 38
11.9 Advertising.......................................................................................................... 38
11.10 Team Personnel................................................................................................... 38
11.11 Lawful Use... ........... ... . .................................................................................... 38
11.12 No Adverse Actions ............................................... .. ........................................ 39
11.13 Team Name............................................................................................................39
11.14 No Nuisance. .........................................................................................................40
11.15 Assignment and Transfer .................................................................................... 40
11.16 Alterations to Team Facilities................................................................................40
11.17 Obligation to Play at Center . .......................................................... . ............... . 41
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11.18 Obligations to Make Payments as Provided in Agreement ...................................41
ARTICLE 12 MUTUAL COVENANTS ............... . ............... .. . .........................................42
12.1 Audit Rights... .......................................................................................................42
12.2 Books and Records ............. .. ...................... .....................................................42
12.3 Confidentiality .. ..................... . . .......................................................................42
12.4 Conduct of Business . ................................................ .......................................... 43
125 Damage and Destruction..................................................................................... 43
126 Force Majeure . .................................................................................................. .43
12.7 Not Partners ...........................................................................................................44
12.8 Interest and Other Charges on Overdue Amounts..... . ........................................ 44
ARTICLE13 DISPUTES.............................................................................................................44
13.1 Submission of Claims or Disputes...................................................................... ..44
13.2 Executive Conference. ..........................................................................................44
13.3 Mediation...............................................................................................................45
134 Arbitration..............................................................................................................45
135 Final Dispute Resolution........................................................................................45
ARTICLE 14 INSURANCE REQUIREMENTS.........................................................................45
141 Team Required Liability Insurance . . .. .. ........... ................................................45
14 2 General Requirements for Team s Insurance ........................................................46
14.3 Subcontractors........................................................................................................48
14.4 Adjustments of Claims...........................................................................................48
145 Remedies on Failure to Insure ............................................................................ . 48
14.6 City's Insurance. . ....... ... . ..................................................................................48
14.7 Mutual Release and Waiver..... . . . . . . . ............................................................49
ARTICLE 15 MISCELLANEOUS PROVISIONS......................................................................49
15.1 Notices...................................................................................................................49
15.2 Time of Essence.....................................................................................................50
15.3 Remedies Cumulative.......................... .............................................................. . 50
15.4 Invalidity of Particular Provisions, Severability....................................................50
15.5 Governing Law and Venue....................................................................................50
15.6 Police Power Reserved......................................................................................... 51
15.7 Schedules ................................................................... ........................................ ..51
15.8 Headings ................................................................................................................51
15.9 References........ .................... . . . . ..... . . ......... ..........................................51
15.10 Certain Rules of Interpretation...............................................................................51
15.11 Construction. . . . . . . . . ............................................................................51
15.12 Entire Agreement...................................................................................................52
1513 Currency................................................................................................................ 52
15.14 Successors and Assigns. . . . ............................................................................... 52
15.15 Prohibition on Private Activity Agreements..........................................................52
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EXHIBITS
Exhibit A WHL Arena Standards
Exhibit B Center Advertising Pro Forma
Exhibit C Ticket/Concessions/Club Seats Revenue Pro Forma
Exhibit D General Admission Targets
Exhibit E Events Center Suite Sales Pro Forma
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LICENSE AGREEMENT
This Agreement is entered into effective as of the Effective Date by and between the City
of Kent ("City"), a code city and municipal corporation of the State of Washington and
THUNDERBIRD HOCKEY ENTERPRISES, LLC ("Team"), a for-profit company incorporated
under the laws of the State of Washington. The City and the Team is each referred to below as a
"Party," and collectively they are referred to below as "Parties."
RECITALS:
A. The City is the owner of the land located in the City of Kent, Washington on
James Street within the City, between 5th Ave. South and the Union Pacific Railroad right-of-
way, and intends to construct a multi-use special events center featuring, among other activities,
professional ice hockey (the "Center") on that land, as further described herein;
B. The Team is the owner of the Western Hockey League (the "League") team, the
Seattle Thunderbirds, with an ongoing franchise from the League that commenced in 1977 (as
the "Seattle Breakers") The Team desires to occupy and use the Center in connection with the
franchise in the manner provided for in this Agreement;
C. Pursuant to a Letter of Commitment dated April, 2006, an Arena Design and
Development Agreement—Kent Event Center dated October 20, 2006, and a Term Sheet for the
Proposed License Agreement Between the City of Kent and Thunderbird Hockey Enterprises,
LLC dated March 6, 2007, the Parties have actively begun cooperating on the design and
development of the Center The City and the Team wish to enter into this License Agreement
(this "Agreement'), which will supersede all of the previous agreements and set forth the terms
and conditions under which the Center will be developed and the Team will have use of the
Center as a licensee
D. The Parties recognize and acknowledge that a constructive relationship between
the City and the Team is critical to the development and operation of a successful public events
facility. While it is contemplated that the City will be providing most of the funding for
construction of the Arena, the City will work closely with the Team and ensure the Team's
involvement in all key elements of the Arena's development. The City. in particular, recognizes
that the Parties' mutual success is key to project success and, to that end. will use its best efforts
to cooperatively construct a contractual relationship designed to achieve success both for the
Team and for the City. The intent of the City and the Team is that the design, construction and
operation process shall be a cooperative, mutual endeavor in which the City and the Team work
together constructively in all major phases of development and operation of the Arena. The
Team will be the principal licensee and user of the Arena and, as such, the City recognizes that
the Team has a substantial and continuing interest in the design, development, construction,
financing and operation of the Arena.
In consideration of the mutual promises and covenants herein contained and other good
and valuable consideration (the receipt and sufficiency of which is hereby acknowledged), the
Parties agree as follows
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ARTICLE 1
AGREEMENT DEFINITIONS
In this Agreement, including the recitals and schedules hereto, the following words have
the following meanings•
1.1 "Agreement' means this License Agreement, as it may be amended from time to
time.
1.2 "Arena" means the Arena located in the Center and having the programmatic
specifications set forth in Section 3.2.
1.3 "Box Seats" means all fixed viewing seats in Suites.
1.4 "Box Office"has the meaning set forth in Section 5.5.
1.5 "Center" means the multipurpose special events center including the Arena,
featuring, among other activities, professional ice hockey, to be constructed by City, which shall
have, among other things, the specifications set forth in Section 3.2 and the surrounding area,
including the Parking Lot.
1.6 "Center Advertising" means all advertising in or around the Center, other than
Hockey Event Advertising and Center Naming Rights.
1.7 "Center Advertising Pro Forma" means the Center Advertising pro forma
mutually agreed upon by the Parties and as set forth in Exhibit B.
1.8 Center Naming Rights means the rights to designate and control the name of
the Center, the Arena, or any part thereof.
1.9 "Center Manager" means a City employee or third party manager appointed by
the City to manage the Center, the Arena or any part thereof, as described in Section 11.4.
1.10 "City" means the City of Kent, a code city and municipal corporation of the State
of Washington, its successors or assigns, including without limitation any public facilities district
created by the City of Kent.
1.11 "Club Seats" means those special fixed viewing seats in the Arena specified from
time to time as club seats, together with specific rights and privileges attached to the right to
occupy such seats as described in Section 6.7.
1.12 "Club Seat Tickets" means Club Seat tickets to regular season and preseason
League Games.
1.13 "Community Ice Sheet' means the Kent Valley Ice Center or other publicly-
owned or privately-owned skating facility within the City and jointly designated by the Parties as
a Community Ice Sheet
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1.14 "Complimentary Tickets" means tickets, or other rights of admission, issued
free of charge.
1.15 "Concessionaire" means the person or persons to whom the City grants
Concessions rights for the Center under Section 11.4.
1.16 "Concessions" means all food and beverage (whether alcoholic or non-alcoholic)
sold by the Concessionaire at Hockey Events, including food and beverage sold through
concession services or catering services
1.17 "Effective Date"has the meaning set forth in Section 4.2.
1.18 "Events Center Suite Sales Pro Forma" means the Events Center Suite Sales
Pro Forma mutually agreed upon by the Parties and as set forth in Exhibit E.
1.19 "Exhibition Game" means any game played by the Team at the Center that is not
a Regular Season Game or a Playoff Game.
1.20 "Facility Fee" has the meaning set forth in Section 5.4.
1.21 "Game Day Facilities" means the following areas of the Center that are available
for use by the Team in connection with each Hockey Event:
(a) the box office or ticket office in the Center, subject to the provisions of
Section 5.5;
(b) the Arena;
(c) the Parking Lot;
(d) the public address system, video board system, and music and sound
system in the Center;
(e) the Visiting Team's locker room and game night officials room;
(f) the press box as defined in Section 3.2(e),
(g) the media control center as defined in Section 3 2(f),
(h) the first aid room as further described in Section 3.2(g),
(i) all public spaces, permanent seating, lobby areas and common areas in the
Center, and
0) such other parts of the Center reasonably necessary for the proper playing,
viewing, or hosting of hockey games
1.22 "GC/CM" means the general contractor/construction manager selected by the
City pursuant to Chapter 39.10 RCW.
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1.23 "Hockey Events" means League Games, other hockey games, and hockey skill
competitions and exhibitions that occur at the Center
1.24 "Hockey Event Advertising,"has the meaning set forth in Section 6.2.
1.25 "Hockey School" has the meaning set forth in Section 8.5.
1.26 "League" means the Western Hockey League (WHL) as now or hereafter
constituted or any successor or replacement league.
1.27 "League Games" means any League hockey games played by the Team, or by
other League teams or Canadian Hockey League teams, in the Center, and includes all Regular
Season Games, Exhibition Games, and Playoff Games.
1.28 "League Schedule" means the annual listing officially promulgated by the
League in advance of each Season, which sets forth the games to be played during the Season by
the League teams as the competition among such teams for the League championship for that
Season, and the dates and places upon which and the locations where all such games are
scheduled to be played.
1.29 "License Fees"means all amounts payable by the Team under Article 5.
1.30 "MACC" means the maximum allowable construction cost for which the GC/CM
commits to construct the Center, as further described in Section 3.3(b).
1.31 "Net Concession Sales" means all gross revenue derived by the Concessionaire
from Concessions at any Hockey Event, less state and local sales and use taxes and less any
commission or other fee retained by the Concessionaire (which shall include Concessionaire's
costs and expenses).
1.32 "Net Ticket Proceeds" means the gross revenue from Hockey Events derived
from: the sale of tickets or other rights of admission (including tickets sold for Box Seats and
Club Seats not otherwise leased or licensed), less commissions or charges paid to unaffiliated
third party ticket brokers for selling such tickets and less ticket, admission, sales or similar excise
taxes or facility fees (other than the Facility Fee) levied on the sale of such tickets by the City or
any city, state or federal taxing authority and paid by the Team. Net Ticket Proceeds does not
include the Facility Fee, which is paid to and earned solely by the City.
1.33 "Non-Hockey Event" means an event occurring at the Center for which tickets
are sold or admission is charged, other than Hockey Events and games associated with Training
Camp and Hockey School
1.34 "Obligor"has the meaning set forth in Section 12.1.
1.35 "Occupancy Date" means the date that the Center is available to permit the Team
to play League Games.
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1.36 "Operating Year" means the 12-month period commencing on June 1 in each
year and ending on the following May 31.
1.37 "Parking Lot" means the new City-constructed parking lot or other facility
located in or adjacent to the Center
1.38 "Party"means the City or the Team, collectively, the "Parties."
1.39 "Playoff Game" means any playoff game that is scheduled by the League or by
the Canadian Hockey League (or its successor or replacement) as part of the post-regular season
play for that Season.
1.40 "Premium Reserved Parking" means an area made available during Hockey
Events exclusively to holders of Suite Licenses, Club Seat licenses, and packaged tickets, as part
of the package of premium benefits provided to such holders.
1.41 "Project" means the process of design and development of the Center.
1.42 "Project Manager" has the meaning set forth in Section 3.10(a).
1.43 "Recipient'has the meaning set forth in Section 12.1.
1.44 "Reduced Facility Fee"has the meaning set forth in Section 5.4.
1.45 "Reference Facilities" means the following event centers in substantially the
size, capacity, design and construction parameters as each facility exists as of the date of this
Agreement. Broomfield Event Center in Broomfield, Colorado, Chevrolet Centre in
Youngstown, Ohio, and the Arena and hockey-related portions of the Everett Events Center in
Everett, Washington (excluding Everett's community ice sheet).
1.46 "Regular Season Games" means any League Game that is part of the League
Schedule.
1.47 "Regular Season" means the period from September 5 of any year to April 30 of
the following year.
1.48 "Regular Seats" means those fixed viewing seats in the Center from which
events in the Center are to be viewed and that are not Club Seats or Box Seats.
1.49 "Returned Tickets" has the meaning set forth in Section 5.4(c).
1.50 "RCW"means Revised Code of Washington.
1.51 "Scheduling Meeting" means the meeting of the League at which the schedule
for an upcoming Season is determined and which is generally held in July of each year or earlier,
and which is expected to be held in June of each year if all teams within the League have lease or
license arrangements that enable the Scheduling Meeting to occur in June.
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1.52 "Season" means, for each year during the Term, the period from the first day of
Training Camp in August until one day after the last League Game in which the Team is
involved, for each League season during the Term; provided however, that if the Team hosts the
championship for the Canadian Hockey League (or its successor or replacement), the Season
shall end on the day following the last Playoff Game.
1.53 "Suite Licenses" are contracts permitting the holders to use one or more Suites,
as described in Section 6.6.
1.54 "Suites" means Box Seat suites located in the Arena whether completed at the
time of the initial construction or thereafter added to the Arena, and excludes the City's Suite,
any Suite allocated to the entity purchasing Naming Rights, and the Suite allocated to the Team.
1.55 "Team" means THUNDERBIRD HOCKEY ENTERPRISES, LLC, a for-profit
company incorporated under the laws of the State of Washington, and its successors and assigns
1.56 "Team Facilities"means those areas of the Center described in Section 3.2(d).
1.57 "Team Store"means the facility described in Section 3 2(d)(n).
1.58 "Term"means the term of this Agreement as provided in Section 4.1.
1.59 "Training Camp" means the Team's main training camp described in
Section 8.4.
1.60 "Visiting Team" means any ice hockey team visiting for the purpose of playing
the Team in a League Game
1.61 "WHL" means the League.
1.62 "WHL Arena Standards" means the WHL Arena Facilities Standards that exist
at the time this Agreement is executed and which are further described in the attached Exhibit A.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
2.1 Representations and Warranties of Team.
The Team represents and warrants to the City, as of the date of this Agreement, as
follows:
(a) The Team is a validly existing limited liability company duly organized
under the laws of the state of Washington, with full corporate power and authority to own and
operate the Seattle Thunderbirds and to carry on its business as it is presently conducted
(b) The Team has full power and authority to enter into and perform its
obligations under this Agreement, and this Agreement has been duly authorized by appropriate
action of the Team's governing board.
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(c) No consent, approval or authorization of, or designation, declaration or
filing with any third party is required on the part of the Team in connection with the execution
and delivery of this Agreement or the performance of the Team's obligations hereunder.
(d) All consents, approvals and authorizations of the constituent owners of the
Team have been obtained, and the person or persons executing this Agreement on behalf of the
Team is fully authorized and empowered to do so.
(e) There are no judicial or administrative actions, proceedings or
investigations pending, or to the best of the Team's knowledge threatened, which question the
validity of this Agreement or any material action taken or to be taken in connection herewith.
(f) There is no litigation pending, or to the best of the Team's knowledge
threatened, against the Team that would materially affect this Agreement or the Team's
obligations hereunder.
(g) The execution of this Agreement by the Team and the performance of the
terms hereof will not violate or constitute a breach of any material contract, agreement or
undertaking to which the Team is a party or is bound;
(h) The Team has not (i) made a general assignment for the benefit of
creditors, (ii) filed any voluntary petition in bankruptcy or suffered the filing of an involuntary
petition by creditors, (iii) suffered the appointment of a receiver to take possession of all, or
substantially all, of its assets; (iv) suffered the attachment or other judicial seizure of all, or
substantially all, of its assets, (v) admitted in writing an inability to pay debts as they come due,
or (vi) made an offer of settlement, extension or composition to creditors generally.
(i) The Team is not insolvent or unable to pay its debts as they mature, and
the consummation of the transactions set forth herein will not make the Team insolvent or make
the Team unable to pay it debts as they mature.
0) The Team has an existing and effective contract or franchise agreement
with the Western Hockey League that enables the Team to compete in that league, subject to the
terms of that contract or franchise agreement
2.2 Representations and Warranties of City.
The City represents and warrants to the Team as of the date of this Agreement as follows:
(a) The City is a code city duly organized, validly existing and in good
standing under the laws of the State of Washington
(b) The City has full power and authority to enter into and to perform its
obligations under this Agreement and to consummate the transactions described herein, and the
execution, delivery and performance of this Agreement by the City has been duly authorized by
the City Council of the City.
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(c) The City is the owner of the property upon which the Arena is
contemplated to be built and is otherwise authorized to develop said property, subject to
applicable regulatory requirements.
(d) Apart from environmental and permitting requirements, no consent,
approval or authorization of. or designation, declaration or filing with any other governmental
agency is required on the part of the City in connection with the execution and delivery of this
Agreement or the performance of the City's obligations hereunder.
(e) There are no judicial or administrative actions, proceedings or
investigations pending, or to the best of the City's knowledge threatened, which question the
validity of this Agreement or any material action taken or to be taken in connection herewith.
(f) There is no litigation pending, or to the best of the City's knowledge
threatened, against the Team that would materially affect this Agreement or the City's
obligations hereunder.
(g) The execution of this Agreement by the City and the performance of the
terms hereof will not violate or constitute a breach of any material contract, agreement or
undertaking to which the City is a party or is bound;
ARTICLE 3
CONSTRUCTION OF CENTER
3.1 Obligation to Construct.
The City shall construct the Center and shall construct the Center in accordance, in all
material respects, with the description set forth in Section 3.2, and thereafter agreed to between
the City and the Team, the consent of which shall not be unreasonably withheld. The City agrees
that the Arena shall meet the WHL Arena Standards. The Parties recognize that the Arena
design and development program are subject to change for consistency with legal requirements
and budgetary constraints.
3.2 Center Description.
Consistent with this Section 3.2, the City agrees that the Center will have, among other
things, the following specifications:
(a) The Center shall include the Arena, including the Team Facilities under
Section 3.2(d) and the Game Day Facilities, and Parking Lot;
(b) The Arena shall contain fixed viewing seating for at least 6,000 people
and no more than 7,000 people including not less than 20 Suites, up to 500 Club Seats with the
ability to convert an additional 300 seats into Club Seats if and when the City and the Team
agree that there is an adequate market for those additional Club Seats The Suites and the Club
Seats shall together be supported by a lounge, a VIP entrance, Suite level restrooms and
designated parking for both Hockey Events and Non-Hockey Events (such parking being further
described in Sections 11.5 and 11.6),
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(c) The Arena shall be designed and constructed in a manner to provide sight
lines from the seating area as provided for in the architectural drawings and construction
specifications developed for the Project,
(d) The City shall cause to be constructed in the Center the following facilities
(collectively referred to as the "Team Facilities") in accordance with this Agreement:
(i) Office space of not less than 3,500 square feet,
(ii) A Team Store, i e , a novelty sales area of not less than 1,300
square feet located on the concourse of the Arena and accessible from the outside of the Arena,
(iii) The Team's locker room of not less than 3,000 square feet,
(iv) The Team's training/work-out facility of not less than 1,500 square
feet(to which may be added the first aid room described below),
(v) A Team first aid room, accessible by the Team and Visiting
Teams;
(vi) One Suite, designated as the "Team's Suite," having all of the
rights, privileges and amenities accorded to holders of Suite Licenses, and
(vii) The Team's storage area of not less than 1,000 square feet.
(e) A press box;
(f) A media control center for operating the scoreboard, sound and lighting;
(g) A first aid room for the public;
(h) The size of the ice surface in the Arena shall be the standard size used in
National Hockey League arenas; and
(i) The Arena shall have cable trays capable of carrying communications wire
and cable of the types agreed upon by the City and the Team, either as part of the initial facility,
or as future additions when agreed upon
3.3 Program Development.
(a) The City acknowledges the Team's interest in having the Arena open for
play as early as possible after the commencement of the Western Hockey League season in 2008.
Accordingly, the Parties agree that they will exercise their best efforts to achieve completion
sufficient for move-in and play on or about December 11, 2008. Both Parties recognize,
however, that notwithstanding their best efforts, the City's ability to develop, secure financing
for, and construct a fully operational Arena by that date depends upon actions of the Team, the
County, the City and other governmental and nongovernmental entities that are beyond control
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of the City Except as described in Section 3.3(b), the City shall not be liable to the Team for
failure to open the Arena by the dates proposed in this section.
(b) In contracting with the GC/CM selected for construction of the Arena, the
documentation setting forth the maximum allowable construction cost ('*MACC") with the
GC/CM shall include the preliminary date of the Center's substantial completion (which shall
mean that state of completion sufficient to allow the Center to be open and for League Games to
be played on the terns and conditions set forth in this Agreement). No later than July 1, 2008,
based upon the GC/CM's submission of an updated MACC as required by its contract with the
City, the City shall identify the final date for the Center's substantial completion. If the actual
date of substantial completion is later than the final date determined by the preceding sentence,
the City, as liquidated damages, shall reimburse the Team for costs and expenses arising from
such delay, at a mutually agreed amount of$25,000 per League Game that is impacted by such
delay, up to one League Game per week of delay (regardless of the number of League Games
actually played by the Team in that week), and up to a maximum of $100,000 total liquidated
damages. Notwithstanding the foregoing, the Crty's obligation to pay the Team liquidated
damages as described in the previous sentence is contingent on the City obtaining a provision in
the MACC documentation or other agreement with the GC/CM under which the GC/CM will
pay the City an equivalent amount of liquidated damages, under equivalent terms, so that the
City will have a source of funds with which to pay the Team liquidated damages The City shall
use its best reasonable efforts to obtain such a liquidated damages clause in the MACC
documentation or another agreement with the GC/CM The Parties acknowledge that, in order to
ensure maximum opportunity for play to begin in the Arena for the 2008 Western Hockey
League Season, it may be necessary to phase construction of the Arena such that construction of
certain elements will be deferred. No such phased construction will be undertaken unless the
City first provides the Team a reasonable opportunity to review and comment on the phased
construction plans and schedule.
3.4 Scheduling.
The parties will exercise their best efforts to open the Arena during the Western Hockey
League 2008-09 Season.
3.5 Budget.
(a) The Arena design will be undertaken in phases and is an evolutionary
process, throughout which the Parties will collaborate. The Parties understand and expect that
this collaboration will produce iterative changes in the Arena design, which necessarily will be
reflected in the budget as it also evolves consistent with the evolution of the design. The Team's
concurrence, where applicable, at any stage that the City should proceed to the next phase of
design and/or to construction and to develop or refine its budget does not preclude or prejudice
continuing consultation, and potential cost allocation, among the Parties in light of any changes
in the design and budget which may result.
(b) The Parties understand and agree that the evolution of the Arena design
also is subject to parallel evolution of the budget as provided herein and that the design and
budget are directly related and mutually dependent. The City will not approve a design and
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initiate or proceed with construction of the Arena inconsistent with the budget. If it becomes
apparent that funds available for the budget will be insufficient to proceed with a previously-
approved design, the City, subject to the Team's concurrence, will make reasonable efforts to
identify design modifications which result in a balanced budget The Parties also agree that the
budget will provide contingency funding for potential cost-overruns.
(c) Following the Design Completion phase and the adoption of a budget,
changes in design requested by the Team that result in an increase in the budget shall be
accompanied by the Team's recommendations for off-setting design changes, use of contingency
funds, and/or a commitment of supplemental funds sufficient to balance the budget in form and
substance reasonably acceptable to the City The Parties will collaboratively work to
accommodate the Team's proposal However, any such changes are subject to the City's review
and approval and to the negotiation of appropriate change orders acceptable to the City with the
GC/CM and Architect, if required. The City, in its reasonable discretion, may approve or reject a
proposed change; the use of contingency funds; and/or the accompanying proposed off-setting
design change and also may, in consultation with the Team, develop and approve an alternative
off-setting design change which it deems preferable to the off-setting change proposed by the
Team.
(d) In the event the City at any time identifies that the development costs for
the Arena exceed budgetary limitations (after taking into account any off-setting design changes)
and unless the City approves the use of contingency funding therefor, the City may reject the
proposal unless a source of supplemental funding acceptable to the City is identified and secured
to pay for the change, Contingency funding shall not be available for changes in Project scope or
other changes requiring major redesign resulting in a significant increase in the budget, as
determined by the City in its reasonable discretion.
(e) The Parties agree that resources available for Arena construction are
limited to revenues generated from Arena-related funding sources and Arena-derived revenues.
Preparation of the budget will be a cooperative exercise between the City and the Team. Design
and construction of the Arena are subject to consistency with the budget, as approved by the
City, subject to the Team's concurrence The budget will be reviewed and revised over time;
each time the City formally approves a budget, it will do so subject to the Team's concurrence,
except and as more specifically provided herein.
3.6 Schematic Design.
In the schematic design phase, the City has caused to be prepared design documents
consistent with the WHL Arena Standards, including any value engineering and any adjustments
in the program, schedule or budget. These documents established the general design parameters
for the Arena, from which construction documents are being prepared.
3.7 Selection of GC/CM.
The City, with the participation of the Team, has utilized its standard Request for
Proposal (RFQ) process, consistent with Chapter 39 10 RCW, to identify and select a
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construction firm possessing the skills, experience, and resources necessary to serve as the
General Contractor/Construction Manager (GC/CM) to construct the Arena.
3.8 Design Completion.
(a) In the Design Completion phase of the Project, the City shall cause to be
prepared construction documents based on the Schematic Design documents and any further
adjustments in the scope or quality of the Project or in the budget As described in
Subsection 3.8(b) below, the City will use its best efforts to advise the Team of developments in
and potential material decisions concerning the design Subject to timely review by the Team,
and subject to the Team's concurrence under Subsection 3.8(c) below, the construction
documents shall be completed consistent with Exhibit A hereto and the schedule prepared by the
GC/CM and approved by the City for timely completion of the Project.
(b) At every stage of design, the City will seek the active participation of the
Team and will give the Team the continuing opportunity to provide advice, identify Team
preferences, and identify for the City, the Architect and other City agents and consultants how
the design for the Arena, the Project schedule, and construction methodologies may affect the
Team's operations The Team's continuing involvement and consultation in the planning,
design, construction and use of the Arena are intended to ensure that the plans, design and
construction of the Arena will be satisfactory to the Team and the City. Consistent advice and
timely participation by the Team and the City are therefore required at all stages.
(c) It shall be a goal of the Arena design process to create a "fan-friendly"
environment that facilitates the enjoyment of events by spectators The City shall not issue final
approval of design of the following areas/components of the Arena without first obtaining
concurrence of that design approval from the Team before the City's chief administrative officer
or his designee issues the approval or change order* spectator sight lines, press box, game night
production facilities/control room, Team offices, home team dressmg room, Team training room,
Team storage room, Club Seats, luxury suites, advertising facilities, and Team novelty sales area.
The Team shall respond promptly to the City requests for comments on and/or approval of these
design elements by the Team The City shall have final approval of design for all other aspects
of the Arena In the event that the City and the Team do not promptly agree to a resolution of
any issue concerning the design elements subject to the Team's approval, either Party may cause
the following special design dispute resolution process to be implemented: a Party may request
an executive conference under Section 13 2, except that such a conference shall occur within
three days, including the exchange of written claims and responses, with supporting information.
If the executive conference does not result in a resolution, either Party may request immediate
arbitration by a special standby arbitrator who shall be Charles M Hartung or any other person
mutually selected by the Parties. The standby arbitrator shall proceed with arbitration within
three days, using an expedited format under Section 13.4. The standby arbitrator shall have the
authority to determine the resolution of the special design dispute, except that if the arbitrator's
recommendation will result in an increase of Project costs, the arbitrator shall recommend a
reallocation of expenditures from another Project component to enable the arbitrator's
recommended resolution to be put into effect. The arbitrator may additionally recommend an
increase in Project costs, but the City shall not be obligated to implement any such Project cost
increases. If, after the standby arbitrator's determination and the City's decision on
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implementation, either Party may commence an action for money damages under Section 13.5,
but the Superior Court shall have no authority to order equitable relief
3.9 Project Cost Calculation.
(a) The Project's Guaranteed Construction Cost (including the MACC, the
GC/CM's fee, the cost of special conditions, and sales tax), together with required and additional
project contingencies, shall be consistent with the budget.
(b) Guaranteed Construction Cost and Cost Savings Procedures: The City and
the Team shall review potential cost savings measures identified by the GC/CM, the Architect, or
other Project participant during Project development, specifically including subcontractor bid
packages and value engineering efforts. The Team may also propose ideas for developing
savings or may submit value engineering proposals to the City which shall be referred to the
GC/CM and the Architect for review
(c) Cost Overrun Contingency: In addition to statutory contingency
requirements, the budget shall contain a general contingency in an amount to be determined by
the City through the budget development and approval procedures provided herein.
(d) In the event that at or prior to completion of this phase, the City
determines that the Arena or its development program is not acceptable, the City shall give
written notice thereof to the Team prior to the initiation of the next phase of the Project as
delineated herein, and the Parties will meet within 24 hours to resolve the disagreement. If
unable to resolve the disagreement, the Parties will utilize the Executive Conference resolution
process established in Section 13.2. This will be the complete dispute resolution process at the
Project Cost Calculation phase, and if unable to resolve any disagreement by the conclusion of
the Executive Conference, this Agreement shall terminate If a Party does not give notice
terminating this Agreement before initiation of the next phase, this contingency shall be deemed
to have been waived and this Agreement shall remain in full force and effect.
3.10 Construction.
(a) Project Oversight: The City will manage construction of the Arena in
close consultation with the Team The Team shall be entitled, at its option and its sole expense,
to have a representative on site at any reasonable time during construction, subject to health and
safety regulations and the overall control of the City's project manager ("Project Manager").
The Team's representative shall be kept informed of all major pending matters by the Project
Manager or designee and have reasonable access to relevant information.
(b) General Conditions: The City will obtain all permits required for
construction of the Arena and will construct the Arena consistent with the approved architectural
drawings, construction specifications and other construction documents and an approved budget.
The City shall ensure that the GC/CM contract documents require all construction to be
performed in a good and workmanlike manner in full compliance with all applicable legal
requirements using materials in accordance with the construction documents.
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(c) Change Orders: The Parties acknowledge that events may occur during
the course of construction that will cause the GC/CM, the Architect, the City or the Team to seek
changes in the approved Construction Documents and/or Guaranteed Construction Cost. The
process set forth below will be observed in evaluating and resolving orders: provided, however,
that any major change order proposal shall require the Team's concurrence. A "major change
order proposal" means any change order that (i) exceeds $50,000 in value and substantially and
materially affects the design and operations of any portion of the Arena directly affecting hockey
play or game presentation, or (ii) is greater or less than $50,000 in value but which substantially
and materially affects those Team Facilities defined in Sections 3 2(d)(i)through 3 2(d)(v).
(i) Following review of each change order proposal, the Project
Manager will formulate a recommendation for the City's and the Team's review and approval
(ii) Comments and approvals (as applicable) required by both the City
and Team, and the time within which each is to respond, will vary with the size, importance and
time-sensitive nature of proposals submitted. If the Parties cannot agree on a time for response,
the default time shall be twenty-four (24) hours from the time the Project Manager submits its
recommendation.
(iii) Each Party will respond to change order proposals as expeditiously
as possible In the event the Team fails to provide to the Project Manager a response to a
recommendation within such time frame, as measured from the date of submittal, the Team shall
be deemed to have approved the recommendation.
(iv) If the City and the Team, at any level, do not concur in the
disposition of a change order proposal, the City's recommendation will be considered by the next
level of the Parties' representatives until informal review has been exhausted. The City, in its
sole discretion, will determine in good faith whether or not to implement the change order
proposal in order to avoid delays in the Project Schedule, to avoid delay claims from the
GC/CM, or to remain within the Project budget If the City determines, in good faith, that the
Project schedule allows time to resolve any continuing deadlock, further resolution will be
subject to the nonbinding dispute resolution procedures provided herein. Notwithstanding the
foregoing, if the change order dispute involves a change in design of one of the
areas/components of the Arena subject to the Team's approval under Section 3.8(c), resolution of
the dispute shall be subject to the standby arbitration process described in Section 3 8(c).
(v) The City reserves its sole right to resolve, in its reasonable
discretion without use of the consultation procedures provided herein, any change order proposal
or other claim or condition without the Team's concurrence in emergencies which threaten life,
health, or safety or potentially entail substantial damage to Arena property. The City shall use all
reasonable efforts to notify the Team prior to making such decision and if the decision would
have an adverse affect on the Arena, the City will use all reasonable efforts to remediate such
adverse affect.
(d) Project Information: The City shall provide the Team with access to:
(a) the statements of the MACC, the budget, and Project construction schedules or other similar
documents, (b)the minutes of all progress meetings between the City and the GC/CM that are
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prepared by the Project architect or GC/CM in accordance with its agreement with the City;
(c) all certificates of payment issued by the Project architect regarding contractor requisitions for
payment; and (d) all other reports and schedules relating to the progress of the construction
which are customarily prepared and delivered to the City by the Architect, the City's
construction manager, the GC/CM or the subcontractors. The City shall make such reports
available to enable the Team to respond promptly and diligently to any request by the City for
the Team's concurrence during this process.
(e) Access: During construction, and subject to reasonable parameters
established by the GC/CM, the Parties shall be entitled to access the Project and to review and
make copies of any files maintained by Project participants, including, without limitation,
permits and approvals, financial and operating statements, environmental audits, soils reports,
inspection reports and studies, service contracts, operating agreements, bills, invoices, receipts,
financial projections, marketing studies, and entitlement applications and to conduct such
investigations, tests, surveys and other analyses as determined to be necessary, at the
investigating Party's sole cost and expense
3.11 Project Completion.
After construction of the project has reached substantial completion, the City shall cause
to be completed (a) contractor's punch list items reasonably required to be completed; and
(b) other work jointly identified and agreed upon by the City and the Team as necessary for the
proper and efficient functioning of the Arena and its systems, which shall be completed either
pursuant to the City construction contracts or through other arrangements by the City
(collectively, the "Post-Closing Items"). The City shall cause the completion of the Post-Closing
Items as soon as reasonably practicable following the commencement of the License. in
accordance with a completion schedule to be developed by the City and the GC/CM with the
concurrence of the Team. The City shall make reasonable best efforts, consistent with the
budget, to obtain industry-standard warranties in connection with the construction of the Arena
and the purchase of any fixtures or equipment to be installed therein, and shall assign to the
Team, or make the Team a third party beneficiary of, all such warranties and any rights to obtain
extended warranties.
ARTICLE 4
TERM AND LICENSE
4.1 Term; Performance Standard.
(a) The term of this Agreement shall be binding and effective as of the
Effective Date and shall continue in full force and effect for a period of thirty (30) years from the
Occupancy Date.
(b) The City or Team may terminate this Agreement effective as of the end of
the Operating Year during which notice of termination is given to the other Party if (i) for any
three consecutive Operative Years, the Net Ticket Proceeds from Regular Seats for Regular
Season Games at the Arena equals less than each year's amount shown on Exhibit D in the
column labeled "General Admission Revenue Target," or (ir) for any three consecutive
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Operating Years, the average number of paid attendees in Club Seats (regardless of actual price
paid) at Regular Season Games equals less than 300
[NOTE The amounts in the General Admission Revenue Target column in Exhibit D
would be 5285 x 13 50 x 36, escalated by 2 5% (or other agreed-upon-factor)per year]
(c) If for any two consecutive years the Net Ticket Proceeds from Regular
Seats for Regular Season Games at the Arena equals less than each year's amount shown on
Exhibit D in the column labeled "General Admission Revenue Target," or (ii) for any two
consecutive years, the average number of paid attendees in Club Seats at Regular Season Games
equals less than 300, the City may at its sole discretion request that the WHL require the Team to
produce a comprehensive business plan covering both business and hockey operations. If the
WHL so requires such a plan, then upon receipt of the Team's business plan. the WHL and the
City will jointly evaluate the plan and make recommendations regarding proposed actions by the
Team to meet the performance standards. If the Team agrees to the recommendations of the
WHL/City, the Team will be granted two Operating Years, commencing in the Operating Year
following the date of such recommendations, to achieve the performance standard set forth
above, and the City may not terminate the Agreement at the end of the third low-attendance
Operating Year as described in subsection (b), immediately above. However, if the paid
attendance (as defined above) for League Games at the Arena during those next two consecutive
Operating Years (i e , the third and fourth Operating Years with low attendance not meeting each
both the Regular Seat and Club Seat tests), the City may then terminate this Agreement effective
upon the last date of the fourth Operating Year with low attendance If the Team does not
provide a detailed business plan or does not substantially follow the actions recommended by the
WHL/City, the provisions of subsection(b), above shall then become effective and the then-
current Operating Year shall serve as the final year of the evaluation period (which period will
comprise a total of three Operating Years — the two consecutive Operating Years referenced at
the beginning of this subsection plus the Operating Year referenced in this sentence).
(d) If during any Operating Year the paid attendance for Regular Seats at
Regular Season Games at the Arena equals or exceeds ninety percent (90%) of the total number
of Regular Seats in the Arena, the amount by which attendance exceeds 90% may be credited at
the Team's discretion to the total paid attendance in either the previous or succeeding Operating
Year, or credited in part to both such Operating Years, for purposes of meeting attendance
thresholds set forth in Sections 4.1(b) or(c).
(e) The Team will use its best efforts to obtain assurance by the WHL that if
at any time during the term of this Agreement, the WHL determines that the Team is no longer a
commercially viable operating member of the League and is unable to continue to operate, and as
a result the Team forfeits or otherwise loses its franchise rights to the WHL, the WHL will offer
the City the first option to purchase the franchise at fair market value or to find a buyer
acceptable to the City and the WHL.
(f) If the cumulative "Total Revenue" received by the City in succeeding
Operating Years from Net Ticket Proceeds, Club Seat Licenses and Net Concession Sales, as
shown on Exhibit C ("Ticket/Concessions/Club Seat Revenue Pro Forma), minus cumulative
actual revenue received by the City in each succeeding Operating Year from Net Ticket
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Proceeds, Club Seat Licenses and Net Concession Sales (and which can be inserted in the
column "Actual Revenue" on Exhibit C), equals a total cumulative negative balance exceeding
$1,000,000 at any time over the life of this 30-year term. the City may request that the WHL
require the Team to develop a comprehensive business plan covering both business and hockey
operations If the WHL joins the City in requiring such a plan, upon receipt of the Team's
business plan, the WHL and the City will jointly evaluate the plan and make recommendations
regarding proposed actions by the Team to reduce the total cumulative negative balance. The
Team agrees that it will follow the jointly-developed recommendations of the City and WHL. A
failure to meet the revenue performance expectations of this subsection 4.1(f) shall not, by itself,
entitle the City to terminate this Agreement.
(g) If the City terminates its license agreement with the Team without first
availing itself of the procedure set forth above in Section 4.1(c), the WHL will be under no
obligation to maintain a WHL franchise in the Center
4.2 Effective Date.
The Effective Date of this Agreement shall be the later of the date at which both the
Team and the City has executed this Agreement
4.3 License.
Subject to the terms and conditions of this Agreement, the City grants a license to the
Team for the Term to:
(a) have the use and occupation for the Term of the Team Facilities as
provided for in this Agreement;
(b) have use of the Game Day Facilities for each Hockey Event as provided in
this Agreement; and
(c) have use of portions of the Game Day Facilities for Training Camp,
Hockey School, and for practices as provided for in this Agreement. The Team acknowledges
that it shall not own or have any real property interest in the Center.
ARTICLE 5
LICENSE FEES
5.1 License Fees.
The License Fees payable by the Team shall be the aggregate of the payments and
amounts required to be paid by the Team to the City pursuant to this Article 5.
5.2 License Fees for Hockey Events.
(a) During the Term, the Team shall pay to the City the sum of Ten Percent
(10%) of the Net Ticket Proceeds within fifteen (15) days of the end of any month in which Net
Ticket Proceeds are received by the Team All payments shall be accompanied by a detailed
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accounting of the Net Ticket Proceeds from all sources, in a form and manner reasonably
acceptable to both the Team and the City.
(b) The Team shall have the right to donate, give or otherwise distribute
Complimentary Tickets to any Hockey Events for promotional, charitable, marketing or other
similar purposes No License Fees shall be payable by the Team to the City with respect to
Complimentary Tickets, and no Facility Fee or other charge by the City or the Facility shall be
imposed on Complimentary Tickets.
5.3 Reimbursement of Costs.
Except as expressly provided in this Agreement, including without limitation the
payments described in Section 11.18, the Team shall not be obligated to pay or reimburse the
City for any expenses incurred by the City in performing the City's obligations and duties under
this Agreement Correspondingly, the City shall not be obligated to pay or reimburse the Team
for any expenses incurred by the Team in performing the Team's obligations and duties under
this Agreement.
5.4 Facility Fee.
(a) Except as otherwise provided in this Section 5.4, the City may impose a
Facility Fee of up to (but not exceeding) one dollar ($1 00) for each ticket (including Club Seat
tickets sold as individual game tickets) sold for League Games, which shall be in addition to the
Team's established ticket prices and applicable taxes All proceeds from the Facility Fee shall
belong to the City and are not part of the Net Ticket Proceeds, and the Facility Fee shall be
collected by the Team and paid to the City along with the amounts described in Section 5.2(a).
(b) Notwithstanding the foregoing, the Facility Fee shall be up to (but not
exceeding) $0.50 (the "Reduced Facility Fee") per game for each ticket sold for the following
1) season tickets and ticket packages that include at least 14 Regular Season Games; 2) tickets
sold as group sales of twenty (20) tickets or more to League Games, and 3) Playoff Game ticket
packages that include all potential home Playoff Games for a playoff series. (The tickets referred
to in items (1), (2) and (3) are collectively referred to as the "Packaged Tickets"). The Team
shall be responsible for the imposition, collection and payment to the City of all Reduced Facility
Fees on Packaged Tickets.
(c) The Team shall not be required to pay to the City the Facility Fee for any
tickets (the "Returned Tickets") which are either refunded by the Team or for home Playoff
Games which are not played At the time the Net Ticket Proceeds for a month are paid by the
Team to the City, the Team shall pay the Reduced Facility Fees to the City for all Packaged
Tickets (other than Returned Tickets) for League Games played during such month.
(d) Notwithstanding the foregoing, the City may not charge a Facility Fee on
Box Seat or Club Seat tickets sold on a license basis, or on Complimentary Tickets.
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5.5 Box Office.
The Team, at its sole cost and expense, will sell tickets to League Games at the Team
Store and through such ticket services as it deems appropriate. Begimmng at 8 a in. on days on
which League Games are played, the City shall make at least four (4) windows at the City's box
office facilities at the Center (the "Box Office") available to the Team for the Team's use, to be
staffed at the Team's sole cost and expense. Beginning two hours before game time on days on
which League Games are played, the City shall make all six (6) windows of the Box Office
available to the team for the Team's use, to be staffed at the Team's sole cost and expense To
the extent the City reasonably determines that it does not interfere with the City's need for the
Box Office for other events at the Center, the City will make one or more windows available to
the Team so that the Team may sell tickets to Hockey Events that involve the sale of tickets in
such large volumes that it is impracticable for the Team to sell those tickets at the Team Store
(e g, WHL playoff games and Hockey Events involving teams in the National Hockey League.
ARTICLE 6
CENTER REVENUES
6.1 Concessions.
(a) For each League Game during the Term, the Team shall be entitled to
receive on a monthly basis, a sum equal to fifty percent (50%) of the Net Concession Sales.
(b) Any payments required to be paid to the Team pursuant to this Section
shall be paid by the fifteenth (15`h) day of the month following the month in which such Net
Concession Sales proceeds are paid to the City.
(c) The City shall require each Concessionaire to pay to the City the Net
Concession Sales before the fifteenth (151") day of the month following the month in which
concession revenues were earned. The City shall provide, or shall cause the Concessionaire to
provide, the Team with a detailed accounting of the Net Concession Sales for League Games on
a monthly basis in a form and manner acceptable to both the Team and the City. The City shall
cause the Concessionaire to keep on the Center premises for at least two years following the end
of an Operating Year all cash register tapes, sales slips and deposit slips, statements, information
or supporting documentation relating to the sale of Concessions and the calculation of the Net
Concession Sales occurring during such Operating Year.
(d) The process for selecting any Concessionaire will be in accordance with
Section 11.4.
6.2 Hockey-Event/In-Arena Advertising.
(a) The Team shall also have the exclusive right at Hockey Events to sell and
retain all advertising revenues from the following (collectively, "Hockey-Event Advertising"):
(i) dasher boards;
(ii) any ice surfacing machines (e.g., Zambonis);
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(iii) under ice displays;
(iv) press box;
(v) players' benches;
(vi) public address system advertising;
(vii) temporary signage, such as temporary banners and portable and
removable boards and displays located outside and within the Arena and its seating area, which
the Team shall remove after each Hockey Event;
(viii) the front or reverse of any tickets for Hockey Events if those
tickets are sold by the Team;
(b) Hockey-Event Advertising on the dasher boards and under the ice surface
shall be installed and removed by the City, but only upon two (2) weeks of notice by the Team,
and then at the City's sole cost and expense However, the Team shall reimburse the City for
costs arising from (i) any Team requests for installation and removal of dasher boards exceeding
ten (10) requests in any Operating Year, and (ii) any Team requests for changes of under-ice
advertising or signage exceeding five (5) requests in any Operating year. The Parties
acknowledge and agree that a "Team request" for dasher board installation and removal, or for
changes of under-ice advertising or signage, (i) may comprise several individual changes in such
boards, advertising, or signage. and (ii) shall not include any changes, installations or removals
of dasher boards or under-ice advertising or signage arising from Non-Hockey Events, which
shall be performed at the City's sole cost and expense. The Team shall be responsible for
installing and removing all other Hockey-Event Advertising, at the Team's sole cost and
expense. All Hockey-Event Advertising shall be temporary and subject to removal after each
Hockey Event if a Non-Hockey Event or another scheduled use of the Center will occur prior to
the next Hockey Event.
(c) For purposes of this Agreement "in-arena advertising" as described in the
attached Exhibit A,paragraph E is the same as "Hockey Event Advertising."
6.3 Scoreboard Advertising.
(a) The Team shall have the exclusive right to sell, and to retain 100% of the
revenue from the sale of, advertising on the video or digital portion of the Center's main
scoreboard (including on any video or digital screens on such main scoreboard), and other video
screens installed in the Center that receive the same audio and/or video feed as the main
scoreboard, and to control the content on all such video or digital portions of the main
scoreboard during all Hockey Events.
(b) Any and all fixed-signage (i.e., non-video and non-digital) advertising on
the Center's main scoreboard shall be subject to the terms and conditions of Section 6 4 as
Center Advertising (e g, with the Team serving as the initial contractor for negotiating an
arrangement with a scoreboard provider, and revenues from the scoreboard contract included in
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"Actual Revenue" on Exhibit B), except that the City shall be entitled to retain 100% of the
revenues from the sale of such fixed-signage main scoreboard advertising.
(c) If the Center's main scoreboard contains electronic variable advertising of
any kind, the Team shall be entitled, at no cost, to advertise upcoming Hockey Events for up to
five (5) minutes on the main scoreboard at every Non-Hockey Event at which the main
scoreboard is in use.
(d) If additional video, digital or electronic advertising media is added to the
Center, that media may be operated during Hockey Events only upon mutual agreement of the
Parties.
6.4 Center Advertising.
(a) The Team and the City shall jointly agree on (i)the placement for all
advertising locations in the Center, and (n)the prices for Center Advertising. Except as provided
below, the Team shall be responsible for the sale of all Center Advertising. The Team shall
serve as the initial contractor to be responsible for the sale of Center Advertising, and shall
receive a commission of fifteen percent (15%) of the revenues from the sale of Center
Advertising, plus an amount equal to twenty-five percent (25%) of those revenues after the sales
commission. The City shall retain the remaining seventy-five percent (75%) of Center
Advertising revenues after the sales commission
(b) Within 30 days after the end of each Operating Year commencing with the
first full Operating Year, the Team and the City shall calculate the actual revenue received by the
City in the previous Operating Year from Center Advertising revenue So long as the Team is
the contractor responsible for the sale of Center Advertising, annual revenue allocations shall be
subject to the following incentive and cancellation provisions:
(i) The actual revenue received by the City in each Operating Year
from Center Advertising revenue shall be inserted in the column "Actual Revenue" on Exhibit B
(or on another substantially similar record maintained by the City and the Team) The City's
Actual Revenue amount over or under the amount shown for that Operating Year under the
column "Advertising Revenue" shall constitute the "Net Difference" between the City's actual
revenue and the agreed projected City revenue.
(ii) For each $5 00 increment of the Net Difference over the
"Advertising Revenue," the City shall immediately remit to the Team (or the Team may retain)
$1 00 of the Net Difference (i e $1 00 of the $5.00). (For example, if the City's Actual Revenue
from Center Advertising in 2008/09 were $275.000, the Net Difference would be $20.000, and
the Team would receive (or retain) $4,000 of that amount.)
(iii) For each $5 00 increment of the Net Difference under the
"Advertising Revenue," the Team shall immediately remit to the City $1.00 of the Net
Difference (i e $1 00 of the $5.00) (For example, if the City's Actual Revenue in 2008/09 were
$235,000, the Net Difference would be($20,000), and the Team would pay the City $4,000 )
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(iv) If in any series of Operating Years in which the Team has
responsibility for the sale of Center Advertising, the net difference between the City's
Advertising Revenue and its Actual Revenue accumulates a negative balance of at least
$250,000, the City may at its sole option and as its sole remedy assume responsibility for the sale
of Center Advertising (For example, if the City's Actual Revenue from Center Advertising
were $155,000 in each year starting in the 2008/09 Operating Year, the cumulative negative
balance by the end of the 2010/11 Operating Year would be $319,284, an amount greater than
$250,000.)
Notwithstanding any of the foregoing, the City and the Team shall conduct a walkthrough
inspection of advertising points no later than 90 days prior to the estimated building opening date
within the Arena and Center. If within fifteen (15) days after such walkthrough inspection, the
Team determines that the Arena is designed with insufficient advertising points to achieve the
City Advertising Revenue, in its sole discretion the Team may permanently opt out of, and the
City or its contractors will assume, the Team's rights and responsibilities for the sale of Center
Advertising.
(c) If the City assumes responsibility for the sale of Center Advertising, the
City's process for selecting any Center Advertising sales contractor for such sales will provide
the Team with the opportunity to participate in the review of and to comment on the acceptability
of the selection of the contractor and the terms of the City's contract with that entity If the
Team so participates, the process shall provide the Team with the opportunity to collaboratively
work with the City to narrow the pool of proposals to a maximum of three finalists From the
final proposals, the City shall, after consultation with the Team, make the decision as to the
selected proposal. Further, if the City assumes responsibility for the sale of Center Advertising,
the Team shall continue to receive twenty-five percent (25%) of the revenue from the sale of that
advertising after sales commissions.
(d) Fixed-signage advertising on any scoreboard shall not be considered part
of Center Advertising or Hockey Event Advertising, and may be sold by the City as part of one
or more packages to help pay for scoreboard fixtures and equipment, provided that, after such
fixtures and equipment are paid for, revenue from fixed-signage advertising on any scoreboard
shall be considered part of Center Advertising revenue.
6.5 Center Naming Rights.
(a) During a period of 90 days from the Effective Date, the City shall be the
lead Party in working actively to identify a person or entity to purchase Center Naming Rights (a
"Naming Sponsor"). During that 90-day period, the Team shall cooperate with the City's efforts
and shall not act to adversely influence any person or entity with respect to a potential Center
Naming Rights agreement being developed by the City If neither a letter of intent nor a
definitive Center Naming Rights agreement has been executed by the end of the 90-day period,
the Team shall be the lead Party responsible for identifying a Naming Sponsor, and the City
shall similarly cooperate with the Team's efforts. If neither a letter of intent nor a Center Naming
Rights agreement has been executed by August 1. 2008, the Parties shall work cooperatively to
identify a third party to seek a Naming Sponsor. The City shall have the final choice of such a
third party, but the arrangement with that entity must provide that any Center Naming Rights
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agreement shall not adversely affect any of the Team's rights under other sections of this
Agreement Any Center Naming Rights agreement shall be subject to City approval based on the
City's financing needs in connection with the Project budget and pro forma.
(b) The Parties contemplate that the Center Naming Rights agreement may
include a large, "up front" payment or some other payment structure that would not result in
equal annual payments over the term of the agreement. For the purpose of determining "annual
revenue" in subsections (c) and (d) below, the Parties will calculate annual revenue by taking the
total amount to be paid during the term of the Center Naming Rights agreement (including any
up front payment) and divide that total by the number of years in the term of that agreement. If
the payment structure of the Center Naming Rights agreement does not provide for equal annual
payments, the Parties will allocate that revenue on the basis of the annual revenue calculation
described in the previous sentence so that each Party receives the same revenue over the term of
the agreement as if the revenues had been allocated in equal annual installments.
(c) If the City is the Party primarily responsible for identifying a Naming
Sponsor, and if the Naming Sponsor acquires Center Naming Rights but does not acquire, under
its Center Naming Rights agreement, either a right to a material amount of Hockey Event
Advertising or Center Advertising, or category exclusivity with respect to Hockey Event
Advertising or Center Advertising, then the City shall receive all annual revenue from the sale of
those Center Naming Rights. If, under that Center Naming Rights agreement, the Naming
Sponsor acquires either a right to a material amount of Hockey Event Advertising or Center
Advertising or category exclusivity with respect to Hockey Event Advertising or Center
Advertising, then annual revenues from that sale of Center Naming Rights shall be divided
between the City and the Team as follows. (i) a commission of fifteen percent (15%), calculated
on each amount paid by the Naming Sponsor, will be paid to the City, (u) of the net amount
remaining after that commission is paid, the next $300,000 will be paid to/retained by the City;
and (lit) of the amount of revenue available after (i) and (ii), fifty percent (50%) will be paid to
the Team and fifty percent (50%) will be paid to the City As used in this subsection (c), a
"material amount of Hockey Event Advertising or Center Advertising" means any advertising
within those two categories other than identifying markings outside the Arena, on the exterior
surface and roof of the Arena, on the scoreboard clock in the Arena, and on commemorative
plaques within the Arena so long as those plaques do not interfere with Hockey Event
Advertising or Center Advertising.
(d) If the Team is the Party primarily responsible for identifying a Naming
Sponsor, then annual revenues from that sale of Center naming Rights shall be divided between
the City and the Team as follows: (i) a commission of fifteen percent (15%), calculated on each
amount paid by the Naming Sponsor, will be paid to the Team, (it) of the net amount remaining
after that commission is paid, the next $300,000 will be paid to the City; and (iii) of the amount
of revenue available after (i) and (it), fifty percent (50%) will be paid to the Team and fifty
percent(50%) will be paid to the City.
6.6 Suites.
(a) Subject to subsection 6.6(b) and (c), below, all revenue realized from the
sale of Suite Licenses shall be allocated between the City and the Team as follows:
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(i) Seventy percent(70%)to the City; and
(ii) Thirty percent (30%) to the Team.
(b) On or before September 30 of each calendar year, the City and the Team
will collaboratively develop the prices for Suite Licenses to be sold for the Operating Year that
begins in the following calendar year. Except as provided below, the Team shall be responsible
for the sale of all Suite Licenses. The Team shall serve as the initial contractor to be responsible
for the sale of Suite Licenses, and shall receive a commission of fifteen percent (15%) of the
revenues from the sale of Suite Licenses, plus, as described below, an amount equal to thirty
percent (30%) of those revenues after the sales commission. The City shall retain the remaining
seventy (70%) of Center Advertising revenues after the sales commission.
(c) Within 30 days after the end of each Operating Year commencing with the
first full Operating Year, the Team and the City shall calculate the actual revenue received by the
City in the previous Operating Year from revenue from the sale of Suite Licenses. So long as the
Team is the contractor responsible for the sale of Suite Licenses, annual revenue allocations shall
be subject to the following incentive and cancellation provisions.
(i) The actual revenue received by the City in each Operating Year
from revenue from the sale of Suite Licenses shall be inserted in the column "Actual Revenue"
on Exhibit E (or on another substantially similar record maintained by the City and the Team).
The City's Actual Revenue amount over or under the amount shown for that Operating Year
under the column "Suite Revenue" shall constitute the "Net Difference" between the City's
actual revenue and the agreed projected City revenue.
(ii) For each $5 00 increment of the Net Difference over the "Suite
Revenue," the City shall immediately remit to the Team (or the Team may retain) $1.00 of the
Net Difference (z e $1 00 of the $5.00). (For example, if the City's Actual Revenue from the
sale of Suite Licenses in 2009/09 were $412,000, the Net Difference would be $20,000, and the
Team would receive (or retain) $4,000 of that amount )
(iii) For each $5.00 increment of the Net Difference under the "Suite
Revenue," the Team shall immediately remit to the City $1.00 of the Net Difference (z e $1 00
of the $5.00). (For example, if the City's Actual Revenue in 2008/09 were $372,000, the Net
Difference would be ($20,000), and the Team would pay the City $4,000 )
(iv) If in any series of Operating Years in which the Team has
responsibility for the sale of Suite Licenses, the net difference between the City's Suite Revenue
and the City's Actual Revenue accumulates a negative balance of at least $300,000, the City may
at its sole option and as its sole remedy assume responsibility for the sale of Center Advertising
(For example, if the City's Actual Revenue from the sale of Suite Licenses were $250,000 in
each year starting in the 2008/09 Operating Year, the cumulative negative balance by the end of
the 2010/11 Operating Year would be $426,000, an amount greater than $300,000.)
Notwithstanding any of the foregoing, if during any Operating Year the Team determines
that the Center Manager is, in the Team's view, failing to provide Non-Hockey Events of
sufficient quality to make the purchase of Suite Licenses attractive to current and prospective
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Suite Holders, the Team may deliver a notice to the City that the Team objects to the Center
Manager's performance in that regard. Following such notice, if the Team determines that
during the next Operating Year the Center Manager's performance with respect to booking
quality Non-Hockey Events has not improved, the Team may in its sole discretion opt out of the
Team's responsibilities for (and commissions from) the sale of Suite Licenses
(d) If the City assumes responsibility for the sale of Suite Licenses, the City's
process for selecting any Suite License sales contractor for such sales will provide the Team with
the opportunity to participate in the review of and to comment on the acceptability of the
selection of the contractor and the terms of the City's contract with that entity. If the Team so
participates, the process shall provide the Team with the opportunity to collaboratively work
with the City to narrow the pool of proposals to a maximum of three finalists. From the final
proposals, the City shall, after consultation with the Team, make the decision as to the selected
proposal. Further, if the City assumes responsibility for the sale of Suite Licenses, then with
respect to each Suite License sold, the City shall pay the Team an amount equal to the top posted
general admission ticket price times the number of seats in such Suite times the number of
League Games held in the Arena.
(e) Suite Licenses shall permit their holders to view all League Games
without additional charge, to attend any Non-Hockey Event (limited to only one performance per
event), and to use the lounge, VIP entrance, Suite level restrooms and Premium Reserve Parking
allocated to the Suites. Suite Licenses shall not permit their holders to attend events that are not
open to the general public, and/or events for which admission is not charged.
(f) For any Hockey Event, where a Suite is not subject to a Suite License the
Team may offer tickets for Box Seats in that Suite to the general public on a per-seat basis at a
price to be established by the Team, but that price shall not be less than One Hundred Fifty
Percent (150%) of the price per Regular Season Game at which Box Seats are offered or a price
mutually agreed upon by the City and the Team. The proceeds from the sale of such Box Tickets
shall be included in Net Ticket Proceeds and not under this Section.
(g) The City shall reserve a Suite for its use at any and all times, and at no
charge to the City. The City may make the Suite available to governmental, nonprofit, and
school persons or entities, and may determine whether or not to charge for that use The City
shall, by providing notice to the Team on or before August 1 of each year, have the right to make
its Suite available for sale for an entire Season; in that event, the Team shall have the option of
selling that Suite for that Season to a single person or entity, or to sell Box Seats in that Suite on
a per-seat basis, and all receipts for the seasonal sale of that Suite or those Box Seats shall be
shared with the Team as Net Ticket Proceeds.
(h) The City agrees that its contract with the Center Manager shall include a
provision requiring the Center Manager to cooperate with the Team and to take reasonable
actions to provide Suite License customers with the same quality of services at Non-Hockey
Events that they typically receive when attending Hockey Events.
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6.7 Club Seats.
(a) The Team shall have the right to sell Club Seats for Hockey Events. A
purchaser of a Club Seat will be a season ticket holder for Hockey Events, and that purchaser
will have the privilege of using the Suite level lounge, VIP entrance, Suite level restrooms,
Premium Reserved Parking, and such other privileges upon which the Team and the City agree.
(b) The City shall have the right to determine the price of and sell (or to
contract for the price determination and sale of) Club Seats for Non-Hockey Events, and the City
shall retain or control the distribution of all revenues with respect thereto. The City shall also
have the right to make Club Seats available for Center uses that do not constitute either Hockey
Events or Non-Hockey Events (e g governmental or community meetings or events at which
admission is not charged). However, holders of Club Seats for Hockey Events shall be provided
with the privilege of buying seats for Non-Hockey events at the price of those seats to the
general public, and those Club Seat holders will have the opportunity to purchase those seats for
such Non-Hockey Events in advance of tickets going on sale to the general public, so long as
such advanced sale can be reasonably accomplished given the nature and scheduling of the
event However, this does not provide Club Seat holders with an opportunity to purchase tickets
in Club Seats at events that are not open to the general public, or to attend events for which
admission is not charged.
(c) All revenues realized from the sale of Club Seat tickets and licenses
therefor shall be allocated between City and Team as follows: the first one hundred dollars
($100) of revenue from the sale of a Club Seat Season ticket shall be paid to the City, and the
balance of revenue from the sale of Club Seats shall be allocated thirty percent (30%) to the City
and seventy percent (70%) to the Team
(d) The Team shall bear the costs of sales of Club Seats and shall not be
entitled to a commission on any Club Seats sold
6.8 Premium Reserved Parking.
(a) The City agrees to designate an area in the Parking Lot, subject to the
Team's approval of the location of such area within the Parking Lot, for Premium Reserved
Parking.
(b) Premium Reserved Parking shall be allocated as follows:
(i) Up to four (4) parking stalls per Suite; and
(ii) One (1)parking stall per two Club Seats.
Operating procedures for the Parking Lot shall provide that parking stalls identified for Club
Seats that are vacant 15 minutes after the commencement of a game, may be used by any
member of the public.
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ARTICLE 7
TEAM FACILITIES
7.1 Use and Occupancy of Team Facilities.
The City shall provide the Team with exclusive use and occupancy of the Team Facilities
during the Term. The Team shall have access to the Team Facilities through a secure entrance
24 hours per day, seven days per week However, except for the Teams use of the Team Suite,
such access shall not entitle the Team, its staff or its players the right to attend events other than
Hockey Events. Subject to such reasonable regulations as may be agreed to by the City and the
Team, the Team shall be entitled to use the common areas of the Center to allow the Team to
access the Team Facilities on a 24 hour per day basis.
7.2 Construction of Team Facilities and Improvements.
The detailed design of the Team Facilities, including the size of various components of
the Team Facilities, will be developed in accordance with WHL Arena Standards through the
process described in Section 3 8 The City shall construct the Team Facilities in accordance
with, and shall supply the Team with the improvements specified in, the provisions of the
Construction Specifications. The City agrees that the level of finish in the Team Facilities shall
be of at least the same level of finish as the Reference Facilities. The City may in its discretion
(and shall not unreasonably refuse to) add or expand upon those improvements in a manner
requested by the Team, but any such additions or expansions shall be at the Team's sole cost and
expense.
7.3 Janitorial Services in Team Facilities; No Additional License Fees.
After the City has completed its obligations set forth in Section 7.2 and the Team has
moved into the Team Facilities, the Team shall be responsible for the costs of improvements,
day-to-day maintenance and janitorial services with respect to the Team Facilities. The Team
shall also be responsible for costs of repairing any Center facilities damaged on account of the
willful acts or negligence of Team members or other direct participants in Hockey Events As
used herein, "direct participants" means staff, players and coaches of the Team or a Visiting
Team The Team may provide such improvements, day-to-day maintenance, janitorial services
and repairs itself, subject to applicable law, or the Team may request that the City provide such
activities and services at the Team's sole expense The City agrees that, except as otherwise
provided for in this Agreement, no License Fees or other amounts other than those specified in
P g P
this Section 7.3 or in Article 5, shall be payable by the Team to the City for the occupancy and
use of the Team Facilities.
ARTICLE 8
USE OF CENTER BY TEAM—GENERAL
8.1 Scheduling—Regular Season Games.
(a) The number of Regular Season Games will be determined by the League
for each Season The exact number of Regular Season Games for each Season will be finalized
as soon as possible following the date of the Scheduling Meeting.
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(b) Subject to Section 8.1(d):
(i) except as provided for in Section 8.1(b)(ii) and (iii) and in
Section 9.1(a), prior to the Scheduling Meeting and the finalization of the scheduling of Regular
Season Games, the City shall not allow any Non-Hockey Events to be booked in the Center on
any Friday, Saturday or Sunday night or on any three (3) or more consecutive week days during
the Regular Season;
(ii) prior to the Scheduling Meeting, the City shall be entitled to book
Non-Hockey Events in the Center (a) on one full weekend per month during the Regular Season,
plus during the Regular Season one (1) additional full weekend (in total for the Regular Season)
and (b) on Thanksgiving Day, Christmas Day and the full weekend immediately preceding
Christmas Day. The City shall immediately notify the Team of the dates on which a Non-
Hockey Event has been booked or may be booked pursuant to this Section 8.1(b)(ii) Any
weekend date without a definite booking by the City under this Section 8.1(b)(n) shall be subject
to being scheduled by the Team for a Hockey Event under Section 8 l(c) As used in this
subsection, "definite booking" means an event which the City reasonably believes will in fact
occur on the specified weekend date, and
(iii) after the earlier of: (a) the date when the League's schedule is
established, or (b) August 20, any dates not scheduled for a Hockey Event by the Team may be
booked by the City for Non-Hockey Events as provided in this Agreement, and for governmental
and public meetings and events at which admission is not charged, but subject to the use of the
Game Day Facilities by the Team as provided for in this Agreement.
(c) The Team shall present the dates required for Exhibition Games and
Regular Season Games to be played in the Center for the upcoming Season to the City not later
g p Y p g Y
than August 20 of each year The dates selected by the Team will comprise the schedule for the
use of the Center and the Game Day Facilities for the playing of Exhibition Games and Regular
Season Games during the upcoming Season. The City acknowledges that Regular Season Games
will be played in the Center on at least twenty (20) Saturday nights and twenty (20) Friday or
Sunday nights during the Season, of which at least fifty percent (50%) of each of the Saturday
night dates and fifty percent (50%) of the Friday and Sunday night dates will occur after
December 25, unless the League schedules dates in a manner different than indicated in this
subsection.
(d) Notwithstanding the foregoing, if the Team becomes aware of any dates
for which the Team will not require availability in the Center, the Team will advise the City of
such dates as soon as practicable so that the City may schedule Non-Hockey Events on those
dates.
(e) For scheduling Non-Hockey Events and governmental and public
meetings or other events at which admission is not charged, the City will ensure that all Non-
Hockey Events or other public events that are booked or held in the Center will not unreasonably
interfere with or impair the Team's use of the Arena, the Team Facilities or the Game Day
Facilities for Hockey Events.
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(f) The Team shall use its best reasonable efforts to cause the League to hold
the Scheduling Meeting in or prior to June of each year, if changes in lease, license or ownership
arrangements at venues used by League teams permit an earlier date for the annual Scheduling
Meeting.
8.2 Scheduling—Playoff Games.
The City shall ensure that the following dates are available to allow the Team to use the
Center and the Game Day Facilities for Playoff Games-
(a) during the period from March 15 to May 15 following the end of each
Regular Season (the "Playoff Period"), the City shall ensure that the Center is available for use
by the Team for Playoff Games on two (2) weekend nights (i.e., Friday-Saturday, Saturday-
Sunday, or Friday-Sunday) each weekend during the Playoff Period, including at a minimum
Saturday night on at least three (3) weekends each month of the Playoff Period; and
(b) during the Playoff Period, the City shall ensure that the Center is available
for use by the Team for Playoff Games a minimum of two (2) consecutive weekdays between
Tuesday and Thursday (i e , Tuesday-Wednesday or Wednesday-Thursday) each week.
(c) At the end of the second Regular Season following the Occupancy Date,
the parties will re-examine the methodology of resolving dates for League Games. If the parties,
acting reasonably, are unable to agree on any changes to the methodology, the processes
included in this Agreement will remain unchanged.
8.3 Scheduling—Hockey Events.
The Team's scheduling of any Hockey Events other than League Games is subject to
Center availability at the time of scheduling and the prior approval of the City. The Team agrees
that it will provide as much prior notice as possible of a proposed Hockey Event other than a
League Game.
8.4 Training Camp.
The Team may hold a Training Camp at the Center in each Operating Year during the
Term and to use those portions of the Game Day Facilities as may be required in connection
therewith together with two other locker rooms in the Center on the following terms and
conditions:
(a) Training Camp shall commence no earlier than August 15 of each year.
(b) Training Camp shall be ten (10) hours per day from 8.00 a.m. to 6:00 p.m.
for a period not to exceed fourteen (14) days, which may include weekends Notwithstanding
the foregoing, upon prior approval of the City (or the City's Center Manager), which approval
shall not be unreasonably withheld, the Team may, upon two weeks notice to the Center
Manager, shift the Training Camp period to a different ten (10) hour block on any specific day,
so long as the Center is not booked for another event that would conflict with the adjusted
Training Camp time. The Team shall be responsible for any additional Center utility or staff
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costs resulting from the adjusted Training Camp time or any Training Camp time longer than
ten(10) hours in a day (for example, increased staff costs resulting from evening scrimmages or
12-hour Training Camp days).
(c) As a condition for the Team's use of the Center for a Training Camp in
any year, the Team must provide the City with the dates required for Training Camp no later than
four (4) months prior to the required dates. After receipt of the dates required by the Team for
the Training Camp, the City shall not, without the prior written consent of the Team, book any
Non-Hockey Events, or governmental and public meetings or other events at which admission is
not charged, in the Center during the dates required for the Training Camp, except for events that
commence at or after 7.00 p.m.
(d) Ice time will be provided by the City in the Arena for each day of Training
Camp and the Exhibition Games. However, upon reasonable request, advance notice to the
Team, and the availability of the Community Ice Sheet for the Team use at the relevant time, the
Team will relocate to the Community Ice Sheet for Training Camp purposes. The City shall be
responsible for the costs of any such relocation and rental of the Community Ice Sheet.
(e) The City shall ensure that the ice surface will be installed and properly
cleaned and flooded at such times as the Team may reasonably request. The Team agrees that
within thirty (30) days after receipt of a written statement from the City of such incremental cost,
the Team will reimburse the City for the actual cost of incremental utilities or energy costs
directly resulting from the use of the Center for the Training Camp The parties acknowledge
that the incremental utility and energy costs payable by the Team will not include any such costs
relating to the installation of ice in the Center and the costs of maintaining the ice surface.
8.5 Hockey School.
The Team may hold a Hockey School for up to two (2) consecutive weeks during the
months of June, July or August in each Operating Year during the Term. Hockey School may be
up to fourteen (14) hours each day, between 8 a.m. and 10 p.m., which may include weekends.
As a condition for the Team's use of the Center for a Hockey School in any year, the Team must
provide the City with the dates required for Hockey School no later than four (4) months prior to
the required dates. The Team shall pay the City a flat annual amount of $4,000 (adjusted
beginning in 2010 based on changes in the U.S. Implicit Price Deflator for Personal
Consumption) for use of the Center for Hockey School in each Operating Year in which a
Hockey School is held, and shall reimburse the City for the City's incremental additional costs of
staffing the Center for the Hockey School.
8.6 Practice Times.
(a) Subject to Section 8.6(e) and Section 8.1(d), the City shall make practice
ice time available in the Center for the Team from the end of Training Camp until the end of the
Season for two (2) hours each day during the Season from 3:00 p.m. to 5-00 p.m for each non-
League Game day on which the Team is not playing an away game Practice ice times for the
Team shall be in the Arena unless the City gives notice to the Team that a Non-Hockey Event or
other City permitted event has been booked for a particular date (such notice to be given at least
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seven (7) days before the particular date), in which event the practice ice time for the Team
and/or any Visiting Team will be on the Community Ice Sheet
(b) On days on which League Games are scheduled, the City shall provide
practice ice time in the Arena in accordance with Section 9.1.
(c) Visiting Teams, or the Team on their behalf, may request practice ice time
in the Center on non-League Game days from 10:00 a.m to 11:30 a.m. It is acknowledged that
such practice time maybe made available in either the Arena or the Community Ice Sheet, and if
the City does not provide such practice ice time in the Center, the City and the Team shall jointly
arrange for alternate practice time at the Community Ice Sheet in accordance with Section 8.6(e).
(d) The City shall ensure that the ice surface on which the Team or the
Visiting Team will be practicing has been properly cleaned and flooded prior to such practice.
(e) Practice ice times will be preliminarily established at the time of the
completion of the League Schedule. The City and the Team will jointly meet with the
Community Ice Sheet to negotiate the availability and rental rate for all necessary practice times.
Costs of rental of the Community Ice Sheet for practice ice times shall be divided equally
between the Team and the City. The Team shall provide the City with as much advance notice
as possible of any requests for changes to practice ice time, it being understood that any changes
may be subject to the availability of the Center The City shall not cancel a preliminarily
established practice ice time in favor of another booking unless the Community Ice Sheet is
available for the use of the Team or a Visiting Team.
ARTICLE 9
USE OF CENTER BY TEAM—GAME DAY
9.1 Use of Game Day Facilities.
(a) During the Term, the Team shall have the exclusive right to use the Center
and the Game Day Facilities for all Hockey Events The "exclusive right to use" means
exclusive of users other than the City, which will continue to have access to and "use" of the
Center to carry out its obligations under this Agreement The City may also have the use of the
lounge in the Center on game days to the extent such use does not interfere with the Team's use
of the Center The Team shall have access to the Game Day Facilities commencing at 9.00 a.m.
on the day of a Hockey Event until two (2) hours after the completion of the Hockey Event.
(b) Unless the Parties agree otherwise with respect to a specific Hockey
Event, the Team will remove Team property from the Game Day Facilities within two (2) hours
following the completion of each Hockey Event Notwithstanding the foregoing, the City agrees
that a Visiting Team may leave its Visiting Team property in the Visiting Team locker room
until 12.00 Noon the immediately succeeding day, unless notified by the City or the Team that
the Visiting Team locker room is unavailable during such time due to a Non-Hockey Event
booking
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ARTICLE 10
CITY'S RIGHTS AND OBLIGATIONS
10.1 Maintenance and Provision of Facilities.
The City shall during the Term:
(a) operate, maintain and repair the Center and the systems and equipment
necessary for the proper operation of the Center and to ensure that the Center is operated as and
remains a top quality, first-class minor league ice hockey facility, i e , a facility generally similar
in operation, maintenance and repair to the Reference Facilities. Except in emergencies, the City
shall not carry out any maintenance or repairs in or to the Center which would interfere with the
Team's use of the Center without the Team's prior consent, which consent shall not be
unreasonably withheld,
(b) be responsible for all day-to-day structural and mechanical repairs to the
Center, including the Team Facilities;
(c) maintain the Center, including the Team Facilities, in a neat, clean, safe
and sanitary condition and in good state of repair (reasonable wear and tear excepted); and
(d) supply and install the following Arena equipment: netting, goal lights,
public address, music and sound system, scoreboards, two (2) Zambonis, and any and all other
equipment mutually agreed to by the City and the Team that is necessary or desirable for hosting
League Games.
The City's obligations under this Section 10.1 include making life-cycle improvements to
repair or replace worn-out facilities and fixtures, but do not include making major capital
expansions or structural changes to the Center.
10.2 Team's Remedies.
(a) In the event the Team reasonably determines that the City is failing in any
material respect to ensure, pursuant to Section 10 1(a), that the Center remains a top quality,
first-class minor league ice hockey facility generally similar in operation maintenance and repair
to the Reference Facilities, the Team shall have the right to deliver a default notice (the "Facility
Default Notice") to the City setting forth the nature of such asserted facility default. Within
twelve (12) months after receipt of such Facility Default Notice, the City shall either (i) cure
such default or (if such cure cannot with due diligence be completed during such twelve (12)
month period) commence such cure within such period and diligently prosecute such cure to
completion, or (n) if the City objects to the Team's assertion that a facility default exists, submit
the matter to the dispute resolution procedure set forth in Article 13 If the arbitrator determines
that the City has failed in any material respect to ensure that the Center remains a top quality,
first-class minor league ice hockey facility pursuant to Section 10 1(a), the City shall cure such
default within 180 days after the arbitrator's determination, or (if such cure cannot with due
diligence be completed during such 180-day period) commence such cure within such period and
diligently prosecute such cure to completion. If the City fails to cure a default as required by this
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Section 10.2(a), the Team shall have the right to terminate this Agreement upon three (3) months
written notice to the City.
(b) In the event the City shall fail to perform in any material respect any repair
or maintenance obligation of the City pursuant to Sections 10 1(b) through 10.1(d), the Team
shall have the right to deliver a default notice (the "City Default Notice") to the City setting forth
the nature of such asserted default The City shall either (i) cure such default within twenty (20)
days after its receipt of a City Default Notice or, if such cure cannot with due diligence be
completed during such twenty (20) day period, the City shall commence such cure within such
twenty (20) day period and diligently prosecute such cure to completion, or (ii) if the City
objects to the Team's assertion that a default exists, submit the matter to the dispute resolution
procedure set forth in Article 13 If the City shall fail to cure a default under this Section 10.2(b)
within the cure period provided herein, and the continuance of such default will result in a team
emergency (as hereinafter defined), the Team shall have the right, but not the obligation,to cure
such default If the Team cures a default pursuant to this Section 10.2(b), the City shall pay to
the Team the costs thereof within ten (10) days after receipt by the City of a statement as to the
amounts of such costs (unless the existence of the asserted default has been submitted to dispute
resolution under Article 13, in which event the City shall pay the Team if and when appropriate
pursuant to the outcome of the dispute resolution process) All work performed by either Party
pursuant to this Section 10 2(b) shall be performed (i) in a manner consistent with that set forth
as the standard for the City's performance of such work in this Agreement and otherwise in
compliance with the provisions of this Agreement, (ii) to completion with reasonable diligence
and at reasonable costs, (in) only to the extent reasonably necessary to effect the cure of such
default, (iv) using reasonable efforts to cause such work to be performed in a manner so as to
minimize the interference with the City's and its other licensees' and invitees' use of the Center,
and (v) wholly within the Team Facilities and without affecting any of the Center's mechanical,
electrical, sanitary, HVAC or other systems. As used herein, "team emergency' shall mean
(i) imminent danger to the health or safety of persons in, on or about the Center and/or the Team
Facilities, and/or (ii) material interference with the Team's ability to conduct its business in the
Center
10.3 Exclusive Rights to Hockey Events.
(a) The City acknowledges and agrees that Team shall have the exclusive
right to present all Hockey Events in the Center.
(b) Subject to the scheduling provisions of Article 8, the Team shall have
control over all Hockey Event related uses of the Center, including all scheduled hockey
practices. In this regard, the Team may implement and enforce rules or regulations pertaining to
the use of the Center for Hockey Events.
10.4 Loading Zone and Buses.
(a) The City shall provide a loading zone for access to the Center, the location
of which will be agreed to between the City and the Team (each acting reasonably) upon
completion of the plans for the Center
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(b) The City shall designate and reserve a parking space for the Visiting Team
bus in connection with League Games.
10.5 Center Personnel.
(a) The City shall provide adequate personnel to operate the Center during
Hockey Events in accordance with the terms of this Agreement, including Arena engineers,
custodial and security personnel, personnel for ticket taking (subject to Section 5 5) and
ushering, an audio/visual technician, equipment and lighting technicians, employees to resurface
and maintain the ice and staff to manage and operate the Parking Lot (including the presence and
participation of the personnel (including police/traffic personnel) as necessary to control traffic
flow to and from the Center before and after a Hockey Event) The Team shall reimburse the
City for one-half of the cost for ticket taking, security and ushers for Hockey Events. All other
personnel described above will be provided at the sole cost and expense of the City.
(b) The City shall provide personnel for a first aid facility for the general
public at each Hockey Event.
(c) The City shall provide persons, equipment and supplies for the purposes of
installing under ice signage (including advertising, the Team logo and the League logo) by
applying paint directly on the ice located below the skating surface; provided that the Team has
provided the design and template for such signage and the required two (2) weeks notice in
accordance with Section 6.2(b).
(d) Game day personnel staffing levels, as described above, will be
determined based on joint evaluation and discussion by the City and the Team.
10.6 Maintenance of Team's Equipment.
The City shall not be responsible for providing or performing any maintenance, repair or
servicing of any of the Team's equipment or personal property The City shall not be
responsible for janitorial or service work on any of the Team Facilities unless compensated by
the Team consistent with Section 7.3.
10.7 Dasher Board System.
Upon the Team's request at least two (2) weeks prior to the relevant date, the City shall
install the hockey dasher board system and the clear plastic screen on the hockey dasher board
system in the Arena prior to each practice and League Game. The City may remove and store
the dasher board system and the clear plastic screen after completion of each use of the Arena by
the Team unless the Arena will be used by the Team on a succeeding day without any
intervening Non-Hockey Event or other governmental or public meeting or events at which
admission is not charged.
10.8 Inspection, Repair and Improvement of the Team Facilities and the Center.
(a) Upon receipt of at least twelve (12) hours' prior notice from the City, the
Team shall provide the City access to the Team Facilities during normal business hours to
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inspect the same and make any repair, improvement alteration or addition thereto or to inspect,
repair, improve, alter or add to any property owned by or under the control of the City deemed
necessary by the City, provided that this right of access shall not impose on the City any
obligation to make any repair, alteration or improvement except as specifically provided herein.
(b) In inspecting, and in making repairs, alterations, additions and
improvements to the Team Facilities or the Center, the City may erect barricades and scaffolding
in and outside of the Center and may otherwise interfere with the conduct of the Team's business
and operations as such action is reasonably required by the nature of the City's work and such
interference shall not constitute a default under this Agreement, provided that, except in
emergency situations, the prior consent of the Team has been obtained (which consent shall not
be unreasonably withheld) and such repairs, alterations, additions and improvements will not
create an unsafe condition for the Team, its employees, players, agents, representatives, guests or
patrons.
(c) The City shall have the right to use any and all means that the City
reasonably considers necessary to obtain entry into the Team Facilities in an emergency situation
without liability to the Team except for any failure to exercise due care for the Team's property.
Any reasonable entry to the Team Facilities by the City in an emergency situation shall not be
construed or be deemed under any circumstances to be a forcible or unlawful entry into or a
detainer of the Team Facilities or a termination of the Team's license to occupy and use the
Team Facilities. The City shall notify the Team or its representatives as soon as is practical
about any entry into the Team Facilities in an emergency situation The City shall advise of the
time of entry, the nature of the emergency and the action taken by the City in respect to such
emergency.
10.9 Broadcast Advertising Time.
The Team agrees that it will grant, or cause the Team's radio or television broadcaster of,
or the operator of the public address system at League Games to grant, to the City:
(a) one minute of radio advertising during each Hockey Game broadcast by
the Team on radio;
(b) five minutes of public address time during each League Game to be used
by the City for advertising purposes.
The City acknowledges and agrees that the timing, content and placement of any
advertising time granted herein is subject to the mutual reasonable consent of both the Team and
the City. The City further agrees that the rights granted under this Section are not assignable or
transferable by the City.
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ARTICLE 11
TEAM'S RIGHTS AND OBLIGATIONS
11.1 Ticketing.
(a) The Team shall have the right to use Box Office windows as set forth in
Section 5.5.
(b) Except as otherwise provided in this Agreement, the City shall not impose,
charge or cause to be imposed or charged any service charges or handling fees of any kind or
matter on any tickets or rights of admission to any Hockey Events, without the prior consent of
the Team Nothing in this subsection shall be deemed to prevent the City from imposing
generally applicable excise taxes on the sale of tickets to taxable events within the City that
affect the Team or ticketing of Hockey Events.
(c) The Team shall be entitled to retain the Net Ticket Proceeds paid by a
person attending a Hockey Event, subject to the License Fees required to be paid by the Team
pursuant to Section 5 2.
(d) The Team shall have the exclusive right to issue Complimentary Tickets
to Hockey Events.
(e) If the Team Store is not publicly visible from the front of the Arena, the
City shall create and install, at the City's cost and expense, sufficient signage to direct patrons to
the Team Store
11.2 Novelties,Etc.
(a) The Team shall have the exclusive right to sell all hockey related
novelties souvenirs wares and rams ro at the Center for all Hockey Events held at the Center.
programs Y
(b) The Team may utilize temporary kiosks in the Center for all Hockey
Events for the sale of hockey-related novelties, souvenirs, wares and programs or for other
related promotional uses. The Team shall be entitled to locate those temporary kiosks as
follows. two (2) on the concourse level and one (1) on the suite level If additional space is
available, the Team shall be permitted five (5) other kiosks in locations agreed upon by the
parties, if the placement of the temporary kiosks does not, in the opinion of the City (acting
reasonably), adversely impact Concession sales or advertising displays. The City will provide an
adequate securable area for the storage of these kiosks. The Team shall be responsible, and at its
own expense, for the temporary installation and the subsequent removal, storage and security of
the kiosks.
(c) The Team shall have the exclusive right at all Hockey Events to host or
assign Team raffles (`50150 draws" or otherwise) and to retain all proceeds therefrom.
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11.3 Under Ice Displays.
The Team shall be entitled, during all Hockey Events held within the Center, to display
the Team's name and logo and the League's name under the Arena ice at any location
11.4 Appointment of Center Manager and Concessionaire.
(a) The City will consult, discuss and otherwise solicit the advice of the Team
in the review and selection of the Center Manager, the Concessionaire and other key personnel
involved in the operation of the Center, and in discussions concerning the menu products and
pricing of the Concessionaire.
(b) In the periodic selection of the Center Manager and the Concessionaire,
the City will use a competitive process, except that the City reserves the right to use a Center
Manager who is a City employee or another Center Manager who is a natural person Under any
selection scenario, the Team shall be permitted to participate in the selection process If the
Team so participates, the process shall provide the Team with the opportunity to collaboratively
work with the City to narrow the pool of proposals to a maximum of three (3) finalists, with both
the City and the Team each retaining the right to prevent a particular proposal from being
included as a finalist From the final proposals, the City shall, after consultation with the Team,
make the decision as to the selected proposal. The City shall consult with the Team if it elects to
terminate a contract with the Center Manager or Concessionaire prior to that contract's stated
termination date.
11.5 Team Parking.
(a) During the Term, the City shall provide to the Team, without additional
charge, the exclusive right to the use of.
(i) Twenty (20) parking stalls for the Team's employees at or near the
Center, which stalls will be available 24 hours per day, 365 days per year, and
(ii) Twenty (20) parking stalls for the Team's players under the same
terms as Section 11.5(a)(i).
In addition, if the City charges for parking at the Parking Lot at times when Hockey Events are
played, the City shall provide thirty (30) parking stalls for the Team's game staff on each such
day, at no charge to the Team or the game staff
11.6 Preferred Parking.
During the Term, the City shall provide the Team with the exclusive right during Hockey
Events to designate an area of the Parking Lot composed of 500 parking stalls, to be reserved for
the holders of Box Tickets, Club Tickets, or Packaged Tickets.
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11.7 Media Rights.
The Team shall have exclusive media and broadcast rights for League Games, including
radio and television coverage, all satellite and close circuit, cable or pay TV rights, Internet, all
photographic and video rights or any similar rights by whatever means or process now existing
or hereinafter developed in preserving, transmitting and/or reproducing for hearing and/or
viewing Hockey Events All copyrights and other rights in law for all of the above media rights
shall remain sole property of the Team The Team shall have the exclusive right to retain all
proceeds received from or in respect of such media rights
11.8 Telephone.
The Team shall, at its sole cost and expense, be responsible for all telephone and high-
speed Internet access service charges and fees with respect to such services provided in and to
the Team Facilities. The City shall, at its sole cost and expense, be responsible for supplying and
installing wiring and cable for telephone and high-speed Internet access services in and to the
Team Facilities.
11.9 Advertising.
The content of any advertising sold in or for the Center by the Team shall be subject to
the City's prior review and approval, which approval will not be unreasonably withheld or
delayed. It is the intent of this Section that the City's approval right is to allow the City to ensure
that such advertising is in keeping with community standards or decency and good taste The
Team acknowledges that the City may prohibit sexually oriented advertising or advertising
relating to gambling, tobacco, other drugs or hard liquor (z e , beverages with an alcoholic
content of greater than 14%) if, in its discretion (acting reasonably), such advertising would be
harmful or damaging to its public image or would cause significant community objections. The
City shall also have the right to prohibit the advertising of products that would conflict with any
written agreement between, among or by the City, the Concessionaire, or the entity responsible
for the sale of advertising under Section 6.4.
11.10 Team Personnel.
The Team shall employ, at its own expense, and have available at all Hockey Events:
(a) timekeepers, gatekeepers, on and off-ice officials;
(b) medical personnel for the Team and Visiting Team, as may be required in
accordance with League regulations.
11.11 Lawful Use.
The Team agrees to comply with all applicable laws of the United States and the State of
Washington and all of the ordinances of the City of Kent, Washington and the rules and
regulations of the City for the use of the Center (including the placement of temporary kiosks
contemplated by Section 11.2(b)), together with all rules and regulations of the Police and Fire
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Departments of the City of Kent, Washington and the King County Department of Public Health.
The Team further agrees that it will:
(a) obtain all licenses, permits and directives necessary to conduct its
business;
(b) comply with any determination made by the Chief or Fire Marshal of the
Fire Department of the City of Kent regarding the number of persons that may be admitted to
and safely and freely move about in the Center at a Hockey Event, and the Team agrees that it
will not issue tickets or other rights of admission to a Hockey Event in an aggregate number
which exceeds the number of persons determined by the Chief or Fire Marshal of the Fire
Department of the City of Kent,
(c) immediately desist from and/or take reasonable measures to prevent or
correct any violation of any law, regulation, rule, ordinance, license, permit or authorization of
which it receives notice, except where such violation is due to the actions or inactions of the City
or such obligation is an obligation of the City under this Agreement, and
(d) pay before delinquency all taxes, levies and assessments arising from
Hockey Events or its occupancy of the Team Facilities, including taxes payable by the Team
arising out of the occupancy of, or activity and business conducted in or from the Team
Facilities, taxes levied on the Team's property, equipment, improvements on or made to the
Team Facilities and taxes levied on the Team's interest in this Agreement.
11.12 No Adverse Actions.
The City agrees that it will not take. and will not cause any actions to be taken, excepting
the use of any regulatory "police powers," that would have the effect of diminishing the Team's
or its rights under this Agreement unless:
(a) at least thirty (30) days prior to any such action being taken, it has
provided the Team a written notice setting forth the nature of the action being taken,
(b) the Team shall have a period of fifteen (15) days following receipt of the
written notice to advise the City in writing whether the Team consents or objects to the action
which is proposed to be taken and failure by the Team to provide such written advice shall be
deemed to be an objection to the proposed action; and
(c) the matter shall be referred to the dispute resolution process referred to in
Article 13 and the City agrees that it will not allow the action in question to be taken until the
matter has been resolved between the parties.
11.13 Team Name.
The City acknowledges and agrees that the Team's name will be the sole property of the
Team and that the City will not be entitled use the Team's name except in accordance with any
license or use agreement which may be entered into between the Parties. However, in
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advertising and promoting the Center, the City shall be entitled to use the Team's name in
describing the Center as the home arena of the Team
11.14 No Nuisance.
The Team shall not, at any time during the Term, permit any excessive or objectionable
noise, odor, dust, vibration, or other similar substance or condition to remain on or be emitted
from the Center; shall not create any nuisance in or adjacent to the Center. and shall not do
anything in the Center that will create a danger to life or limb, except such dangers as are the
necessary result of hockey playing or practicing. The City expressly acknowledges that the
Team may use lights, fire and pyrotechnics in the course of a Hockey Event and consents to such
use provided that the Team is responsible to determine the number and extent of all required
regulatory and safety permits and approvals and provided that the Team has obtained all prior
written approvals from all applicable authorities, specifically including, without limitation, the
City's Fire Department.
11.15 Assignment and Transfer.
(a) The Team shall not assign or otherwise transfer to another person or entity
any of its rights or responsibilities under this Agreement, or assign or transfer all or substantially
all of the Team's assets or effect a change in the controlling member of the Team, without the
prior written approval of the City, which consent shall not be unreasonably withheld,
conditioned, or delayed. The City acknowledges and agrees that the use of contractors or
consultants by the Team to assist the Team in performing its responsibilities under this
Agreement shall not be deemed an "assignment" or "transfer" of the Team's rights or
responsibilities hereunder.
(b) The City may assign all or a portion of its rights and obligations under this
Agreement to a public facilities district created by the City The City may also assign rights and
obligations to the Center Manager, but the City and its assignees shall continue to be responsible
to the Team with respect to any obligations so assigned but not performed by the Center
Manager consistent with this Agreement.
11.16 Alterations to Team Facilities.
(a) The Team shall not construct any improvements, additions or alterations
to the Team Facilities without the prior written approval of the City, which approval shall not be
unreasonably withheld. The Team shall submit to the City for approval (not to be unreasonably
withheld) schematic designs, design development drawings and final working drawings and
specifications of such improvements, additions or alterations All such improvements, additions
or alterations shall be at the Teams sole expense.
(b) The approval by the City of the Team's plans and specifications for
improvements, alterations and additions to the Team Facilities or the Center, if obtained, shall
only constitute the City's approval as the Arena owner, this approval shall not constitute an
opinion or representation by the City as to any regulatory compliance with any law or ordinance
or their adequacy for other than the City's own purposes, and such approval shall not create or
form any regulatory approval or the basis of any liability on the part of the City or any of its
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officers, employees, or agents for any injury or damage resulting from any inadequacy or error
therein or any failure to comply with applicable laws or ordinances
(c) No improvement, alteration or addition shall be constructed, placed, or
erected on the Team Facilities except in accordance with plans and specifications therefor and to
which the City has given approval. Immediately following the Team's receipt of notice by the
City of any material variation between the approved plans and specifications and any
improvement, addition, or alteration in, on, or being made to the Team Facilities, the Team shall
either desist from occupation, use, and operation of such supplementary improvement, addition.
or alteration and remove it from the Team Facilities or ensure that it is made consistent with such
approved plans and specifications
(d) The Team may request that the City carry out improvements, additions or
alterations to the Team Facilities. If the City concurs in such improvements, additions or
alterations, or any change to any other facility, utility or service provided by the City, the Team
shall pay, as an additional charge, any and all reasonable costs incurred by the City in carrying
out those improvements, additions or alterations or in making such change.
(e) All improvements, additions and alterations to the Team Facilities or other
elements of the Center shall become the property of the City and may not be removed by the
Team, except for the Team's equipment, furniture and trade fixtures. Any damage caused by or
resulting from removal of equipment, furniture and trade fixtures shall be repaired at the Team's
expense
11.17 Obligation to Play at Center.
Throughout the Term, the Team agrees that the Team shall play all home League Games
in the Arena; except that Team shall be entitled to play Exhibition Games in other facilities, but
only to promote the Team and attendance at the Center
11.18 Obligations to Make Payments as Provided in Agreement.
(a) Throughout the Term, the Team shall make all payments to the City as set
forth in this Agreement, including without limitation the payment of License Fees under
Article 5, Facilities Fees under Section 5 4, the City's share of Net Center Advertising revenues
under Section 6.4 (when and as applicable), the City's share of Naming Rights under Section 6 5,
the City's share of Suite License sales under Section 6.6, the City's share of Club Seat revenue
under Section 6 7, reimbursements under Section 7 3, the cost of providing specified personnel at
the Center during Hockey Events as described in Section 10 5, and the cost of alterations as
described in Section 11.16.
(b) Revenues from Concessions and the sale of Center Advertising, Naming
Rights, and Suite Licenses shall as soon as practicable be deposited in special accounts
maintained by one or more third-party custodians or trustees mutually selected by the Team and
the City. A custodian or trustee may be the Team's bank or the City's bank, but such special
accounts shall nevertheless be established on a custodial or trust basis, separate from the Team's
and the City's accounts. A custodian or trustee shall account for and disburse those revenues to
the Team and to the City respectively, based on the provisions of this Agreement and based on a
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protocol or instructions agreed upon by the Team, the City and the custodian or trustee. The cost
of custodial or trustee fees shall be divided equally between the City and the Team.
ARTICLE 12
MUTUAL COVENANTS
12.1 Audit Rights.
(a) The receipt by either Party (the "Recipient") from the other Party (the
"Obligor") of any payment or detailed accounting statements pursuant to this Agreement shall
not be deemed to be a waiver of any of its rights, provided that after two years following the end
of the Operating Year in which the payment was made, all statements shall be deemed to be
conclusive and the Recipient shall have no right to audit the books and records of the Obligor in
respect of such statements.
(b) A Recipient shall, from time to time and in normal business hours, be
entitled to inspect and audit the books and records of the Obligor to verify the accuracy of the
payments previously made by the Obligor. The Recipient shall be entitled to conduct the audit
using its personnel or to engage a qualified chartered accountant or certified public accountant in
good standing to conduct the audit. If the amount of any revenue of the Obligor on which a
payment to the Recipient is based is found to be greater by at least three percent (3%) of the total
of the amount shown on the statement or statements delivered to the Recipient, the costs of the
audit shall be borne by the Obligor, otherwise the costs of the audit shall be borne by the
Recipient.
(c) If it is determined, as a result of an audit, that there was an underpayment
in the payment required to be made by the Obligor, the Obligor shall immediately make such
payment to the Recipient, unless the Obligor disputes the result of the audit, in which case the
matter shall be submitted to dispute resolution in accordance with Article 13
(d) If it is determined, as a result of an audit, that there was an overpayment in
the payment required to be made by the Obligor, the Recipient shall immediately refund the
amount of the overpayment to the Obligor, unless the Recipient disputes the result of the audit, in
which case the matter shall be submitted to dispute resolution in accordance with Article 13.
12.2 Books and Records.
An Obligor shall maintain true, accurate, complete and auditable books and records of all
revenue accrued by the Obligor upon which a payment to a Recipient is based and shall retain all
such books and records for a period of thirty-six (36) months following the close of the
Operating Year in which the payment was made.
12.3 Confidentiality.
A Recipient covenants that the Recipient, its personnel, representatives, agents, lawyers
and auditors will hold all books and records of the Obligor, and all information acquired
therefrom, strictly confidential and will not disclose any of such books and records or
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information to any third party for any purpose except as may be required by law. The Parties
acknowledge that use of records by the City is subject to Chapter 42 56 RCW
12.4 Conduct of Business.
Each of the Parties agrees that it will conduct its business affairs in good faith and in such
a manner as to ensure that the other Party will at all times receive the fair and proper revenue
attributable or payable to the other Party in accordance with the intentions of this Agreement.
12.5 Damage and Destruction.
In the event of any damage or destruction to the Center the following provisions shall
apply-
(a) the City shall proceed to rebuild and repair the damage or destruction;
(b) License Fees payable by the Team shall be reduced in proportion to the
impact such damage or destruction had upon the sources of the Team revenue provided for in
this Agreement until the damage or destruction has been repaired However, unless the Center is
in a condition so that the Team is able to fully and properly play League Games in the Arena, all
License Fees shall abate until the Center has been repaired to the extent that the Arena can be
used for League Games;
(c) if the Parties cannot agree on the proportion of abatement, the matter will
be determined in accordance with the dispute resolution procedure set forth in Article 13.
(d) if, within one hundred and eighty (180) days of the damage or destruction,
the City fails to commence repairs or restoration to the Center so that the Center can be used for
League Games, the Team shall have the option to terminate this Agreement as of the date of such
damage or destruction,
(e) if, within one hundred and eighty (180) days of the damage or destruction,
the City has not made complete repairs or restoration to the Center so that the Center can be used
for League Games, the Team shall have the option to terminate this Agreement as of the date of
such damage or destruction. and
(f) unless and until this Agreement is terminated in accordance with
Section 12 5(d) or Section 12 5(e) but subject to the provisions of this Section, this Agreement
shall remain in full force and effect notwithstanding such damage and destruction.
12.6 Force Majeure.
Whenever a Party's performance of any obligation under this Agreement is prevented by
an occurrence of an event beyond the reasonable control of a Party that cannot be prevented or
remedied with the exercise of reasonable diligence, including an act of nature; war or war-like
operation, civil commotion, not, terrorist acts; labor dispute (including a strike, lock-out, or
walk-out) involving employees other than employees of either Party; sabotage; initiative or
governmental regulation or control, then performance of such affected obligation shall be
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suspended but only for so long as such occurrence remains beyond the reasonable control of such
Party or cannot be prevented or remedied by such Party. This Section 12 6 shall not apply to
payment obligations In the event of a labor dispute, the Party directly involved in the same shall
make a good faith effort to ensure, through available legal means, that such person's obligations
under this Agreement during the period of such dispute are not prevented or unreasonably
delayed, but nothing herein shall require such Party to waive or otherwise reduce its claims in
such dispute.
12.7 Not Partners.
The City and the Team are not partners or joint venture participants and the relationship
between them is strictly that set out herein and not of partnership orjomt venture in any way.
12.8 Interest and Other Charges on Overdue Amounts.
Any amounts not paid by a party when due shall be subject to an administrative charge of
$50 and shall bear interest at the rate of one percent (1%) per month (twelve percent (12%) per
annum) from the due date until paid in full. Payments made after the due date shall first be
applied to the administrative charge, then to interest and then to the principal sum due. Unpaid
amounts shall not bear interest when and to the extent a delinquency is due to an incident of
force majeure as defined in Section 12.6.
ARTICLE 13
DISPUTES
13.1 Submission of Claims or Disputes.
Any claim or dispute between the Parties relating to the requirements of this Agreement
may be submitted in writing by a Party to the dispute resolution process as described below,
except as otherwise provided with respect to the standby arbitrator process described in
Section 3.8(c) Throughout the process, the City and the Team shall proceed in a timely manner
and in good faith to resolve claims or disputes based on accurate and shared information and on a
confidential basis.
13.2 Executive Conference.
The Parties shall make a good faith effort to resolve any dispute or claim by negotiation
between representatives with decision-making power If resolution does not result within two (2)
weeks after a Party's receipt of a written notice of dispute, the City and the Team shall then
attempt to resolve the dispute through a direct conference of the City Administrator and the
Team's Chief Executive Officer or President. or, if any of those persons are not promptly
available, a designee of the City Administrator. Team Chief Executive or Team President,
respectively. The procedures utilized for the conference shall include the exchange of written
claims and responses, with supporting information, at least seven (7) calendar days prior to the
conference; however, the Parties, by mutual agreement, may shorten or extend this time frame
and may make arrangements regarding the exchange of documents. The positions expressed,
responses, and submitted information shall not be admissible as evidence in any subsequent
dispute resolution or legal proceeding.
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133 Mediation.
If the procedure set forth above does not result in resolution of the claim or dispute, then
within ten (10) calendar days after the last conference meeting or final exchange of written
positions, the City and the Team may mutually agree to initiate a non-binding, structured
mediation to be developed by the Parties with the assistance of individuals or organizations
experienced in alternative dispute resolution ('*ADR"). The Team and the City shall agree on a
single qualified mediator The ADR process will be a mediation process only and neither party
is bound to any other ADR process, specifically including arbitration The ADR process will be
initiated within thirty (30) days of the request unless extended by an agreement of both Parties
The ADR procedures utilized for the mediation shall include the exchange of written claims and
responses, with supporting information, at least five (5) days prior to the actual mediation The
positions expressed and the mediator's recommendations and/or findings shall not be admissible
as evidence in any subsequent arbitration or legal proceeding.
13.4 Arbitration.
In the event that the dispute remains unresolved, the City and the Team may mutually
agree to submit the claim or dispute to arbitration before a single arbitrator agreed to by the
Parties. Unless otherwise mutually agreed between the Parties, any such arbitration will be
conducted utilizing an expedited format in which each side shall have a restricted period of time
to present its case, so that the entire presentation of testimony and evidence by both sides may be
concluded in one day. The arbitrator shall provide a decision on the matter within two
(2) business days of the hearing, or such other time period agreed to by the Parties.
13.5 Final Dispute Resolution.
Any continuing dispute that exists after undertaking any dispute resolution processes
established above can be continued only by filing suit exclusively under the venue, rules and
jurisdiction of the King County Superior Court, King County, Washington.
ARTICLE 14
INSURANCE REQUIREMENTS
14.1 Team Required Liability Insurance.
(a) The Team shall at all times during the term of this Agreement, obtain and
maintain continuously, at its own expense, a policy or policies of insurance as enumerated
below
(i) A policy of Commercial General Liability insurance, written on an
insurance industry standard occurrence form (CG 0001 or equivalent), including all the usual
coverages (or their equivalents) such as:
(1) Center/Operations Liability;
(2) Products/Completed Operations;
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(3) Personal/Advertising Injury Contractual Liability;
(4) Independent Contractors Liability,
(ii) Such policy(ies) must provide the following minimum Inuits:
$2,000,000 Property Damage
$2,000,000 Bodily Injury
$2,000,000 General Aggregate
$2,000,000 Per Occurrence/Event Aggregate
$2,000,000 Products & Completed Operations Aggregate
$1,000,000 Personal & Advertising Injury
$1,000,000 Each Occurrence
$5,000,000 Umbrella Coverage
(b) Any deductible or self-insured retention must be disclosed and is subject
to approval by the City The cost of any claim payments falling within the deductible shall be
the responsibility of the Team.
(c) The Team shall obtain and maintain continuously a policy of Business
Automobile liability, including coverage for owned, non-owned, leased or hired vehicles written
on an insurance industry standard form (CA 0001) or equivalent Such policy(ies) must provide
a minimum limit of$1,000,000 Bodily Injury and Property Damage per accident.
(d) The Team shall obtain and maintain continuously a policy of Worker's
Compensation insuring the Team's liability for industrial injury to its employees in accordance
with the provisions of Title 51 RCW, provided, that if the Team is qualified as a self-insurer in
accordance with Chapter 51.14 RCW, the Team shall certify that qualification by a letter that is
signed by a corporate officer of the Team and is delivered to the City setting forth the limits of
any policy of self insurance covering its employees Any such policy shall include Stop Gap or
Employers Contingent Liability.
(e) The insurance provided for in this Section shall meet all minimum
requirements of those specified by the League, the Canadian Amateur Hockey Association, and
the Amateur Hockey Association of the United States for hockey teams in the League.
(f) The coverage amounts indicated in Section 14 1(a) shall be increased by
mutual agreement of the parties in writing within ninety (90) days after the fifth, tenth, fifteenth,
twentieth, and twenty-fifth anniversary date of the Effective Date of this Agreement. Any
disagreement regarding coverage increases shall be resolved by the dispute resolution provisions
of Article 13.
14.2 General Requirements for Team's Insurance.
(a) The insurance coverage to be provided by the Team pursuant to this
Agreement shall be endorsed to include the City, its officers, elected officials, employees, agents
and volunteers as additional insureds; shall be primary as respects the City, and any other
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insurance maintained by the City shall be excess and not contributing insurance with the Team's
insurance, and provide that such insurance shall not be reduced or canceled without 45 days prior
written notice to the City.
(b) All insurance policies required hereunder shall be subject to approval by
the City (not to be unreasonably withheld) as to company, form and coverage. All policies shall
be issued by a company rated A-, VII or higher in the A M Best's Key Rating Guide and
licensed to do business in the State of Washington A surplus line may be used only if suitable
coverage is unavailable as indicated above, in that event such surplus coverage must be issued by
a Washington surplus lines broker, and shall be primary to any other applicable insurance.
(c) Any deductible or self-insured retention must be disclosed to, and shall be
subject to approval by the City. The cost of any claim payments falling within the deductible
shall be the responsibility of the Team or its contractor, as appropriate.
(d) The following documents must be provided to the City as evidence of
insurance coverage secured and maintained by the Team:
(i) not less than ten (10) days prior to the Team's first use of any of
the Center pursuant to this Agreement,
(ii) within seven (7) calendar days prior to the expiration or renewal
date of each such policy;
(iii) within seven (7) days after the Team's receipt of a written request
therefor, a copy of each of:
(1) the policy's declaration pages, showing the insuring
company, policy effective dates, limits of liability and the schedule of forms and endorsements
specifying all endorsements listed on the policy including any company-specific or manuscript
endorsements;
(2) the endorsement naming the City, its officers, elected
officials, employees, agents and volunteers as additional insureds, showing the policy number,
and signed by an authorized representative of the insurance company (whether on ISO Form CG
2026 or an equivalent form);
(3) an endorsement or policy provision stating that the
coverages provided by such policy to the City or any named insured shall not be terminated
reduced or otherwise materially changed without providing at least forty-five (45) days prior
written notice to the City, and
(4) the Commercial General Liability and Business
Automobile liability insurance to be secured and maintained pursuant to Section 14.1, a copy of
a "Separation of Insureds" or "Severabihty of Interests" clause indicating essentially that except
with respect to the limits of insurance and any rights or duties specifically assigned to the first
named insured, such insurance applies as if each named insured were the only named insured,
and separately to each insured against whom claim is made or suit is brought.
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(e) The evidence specified in Section 14.2(d) shall be delivered to the
addresses set forth in Section 15 1 or to such other addressee(s) or address(es) as may be
specified by notice provided to the Team. Until notified otherwise, the Team shall provide a
copy of that evidence to Chris Hills, Risk Manager, City of Kent, 220 4th South, Kent, WA
98032.
(f) The insurance provided by the Team shall meet all minimum requirements
of those specified by the League.
14.3 Subcontractors.
The Team shall include all subcontractors as insureds under its policies or shall furnish
separate evidence of insurance as stated above for each subcontractor. All coverages for
subcontractors shall be subject to all the requirements stated herein and applicable to their
profession.
14.4 Adjustments of Claims.
The Team shall provide for the prompt and efficient handling of all claims for bodily
injury, property damage or theft arising out of the activities of the Team under this Agreement.
The Team shall ensure that all such claims, whether processed by the Team or the Team's
insurer, either directly or by means of an agent, will be handled by a person with a permanent
office in the Kent area.
14.5 Remedies on Failure to Insure.
The City shall notify the Team whenever City has a reasonable belief that the Team has
failed to secure or maintain insurance as required by this Agreement. Notwithstanding any other
provision of this Agreement, after its receipt of any such notice, the Team shall not enter upon
the Center until the Team has secured and is maintaining insurance as required by this
Agreement
14.6 City's Insurance.
(a) The City shall take out and maintain during the Term the following
insurance:
(i) building insurance on the Center;
(ii) equipment, fixtures, improvements on other contents insurance on
property that is situated in the Center and owned by the City or which is installed by the City
during the Term;
(iii) boiler and machinery insurance covering boilers and pressure
vessels owned by and under the control of the City;
(iv) comprehensive general liability insurance covering the operations
of the City in the Center, and
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(v) such other insurance coverages as would reasonably be considered
appropriate having regard to the size, age and location of the Center
The policies referred to above shall contain a waiver of subrogation rights by the City's
insurers against the Team When and if the City obtains comprehensive general liability
coverage under subsection (iv) above through commercial insurance, if available at
commercially reasonable rates, the liability policy shall name the Team as an additional insured
with respect to liability arising out of the Center's operations.
(b) Such insurance shall include such perils, for such amounts and with such
deductibles as the City as a reasonable owner of a reasonably similar facility would deem
advisable having regard to the size, age and location of the Center, provided always that the
Center will be insured for its full replacement value.
(c) All or a portion of the insurance provided for in this Section 14.6 may be
provided by pool insurance, commercial insurance or self-insurance of the type customarily used
by the City and Washington cities of similar size.
14.7 Mutual Release and Waiver.
For and in consideration of the execution of this Agreement, the City and the Team each
hereby releases and relieves the other, and waives its claim of recovery from the other for loss or
damage to owned or rented property arising out of or incident to fire, lightning and the perils to
the extent covered under any extended coverage insurance policy or endorsement approved for
use in the State of Washington, whether such loss or damage is due to negligence of either party
or any agent or employee of either or any other person, unless an insurance policy secured by
either party hereto pursuant to this Agreement or otherwise would become void upon the making
of such release and waiver.
ARTICLE 15
MISCELLANEOUS PROVISIONS
15.1 Notices.
Notices and other communications under or in relation to this Agreement shall be in
writing and:
(a) personally served upon the addressee, if an individual, or an officer or
director of the addressee, if a corporation, or
(b) delivered, transmitted by facsimile or sent by single registered mail, to the
addressee as follows:
for the City:
City Clerk, City of Kent
220 4ch Ave South
Kent, WA 98032
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Phone: (253) 856-5728
Fax: (253) 856-6725
With a copy to the Mayor, at the same address
for Team:
Mr Russ Farwell
Thunderbird Hockey Enterprises LLC
14326 124`h Avenue NE
Kirkland, Washington 98034
Phone: (425) 497-0812
Fax. (425) 497-0812
Notices personally served, delivered or sent by facsimile transmission shall be deemed to
have been given to the addressee on the business day following service, delivery or transmission.
Mailed notices shall be deemed to have been given to the addressee on the third business day
from the date of mailing, but if the mail service is interrupted during such period due to strike,
lockout or other cause, the notice must be given again by personal service, delivery or facsimile.
A party may, by notice to the other party, change its address or facsimile number.
15.2 Time of Essence.
Time is of the essence in this Agreement.
153 Remedies Cumulative.
Rights under this Agreement are cumulative; any failure to exercise on any occasion any
right shall not operate to forfeit such right on another occasion. Each Party shall also have any
other remedy given by the law. The use of one remedy shall not be taken to exclude or waive the
right to use another
15.4 Invalidity of Particular Provisions; Severability.
Should any term, provision, condition or other portion of this Agreement or the
application thereof be held to be inoperative, invalid or unenforceable the remainder of this
Agreement or the application of such term or provision to persons or circumstances other than
those to which it is held invalid or unenforceable shall not be affected thereby and shall continue
in full force and effect.
15.5 Governing Law and Venue.
This Agreement shall be construed under the Law(s) of the State of Washington. Venue
and jurisdiction for any action brought hereunder shall be in King County. Washington.
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15.6 Police Power Reserved.
Nothing in this Agreement shall be deemed to impair the City's regulatory authority in
the exercise of the police power granted by Article XI, Section I I of the Washington State
Constitution, Title 35 RCW or other applicable law.
15.7 Schedules.
Schedules and/or Exhibits attached to this Agreement form part of this Agreement.
15.8 Headings.
The headings and the division of this Agreement into Articles and Sections are for
convenience of reference only and shall not affect the interpretation of this Agreement.
15.9 References.
Unless otherwise specified in this Agreement:
(a) References to Articles, Sections and Schedules are to Articles, Sections
and Schedules in this Agreement;
(b) "Hereto", "herein", "hereby", "hereunder", "hereof' and similar
expressions, without reference to a particular provision, refer to this Agreement.
15.10 Certain Rules of Interpretation.
Unless otherwise specified in this Agreement:
(a) the singular includes the plural and vice versa;
(b) gender references shall be read with such changes as may be required by
the context;
(c) "in writing" or"written" includes printing,typewriting, fax or telecopy;
(d) "including" and "in particular" are used for illustration or emphasis only
and not to limit the generality of any preceding words, whether or not non-limiting language
(such as "without limitation", "but not limited to" and similar expressions) is used with reference
thereto; and
(e) reference to any statute, regulation, rule, policy or bylaw includes
amendments, consolidations, re-enactments and replacements thereof
15.11 Construction.
This Agreement has been prepared through the joint efforts of the Parties and shall not be
construed against a Party by reason of having been prepared by such Party.
508314022
15.12 Entire Agreement.
This Agreement constitutes the entire agreement between the Parties and cancels and
supersedes any prior agreements, undertakings, declarations and representations, written or oral,
in respect of the subject matter of this Agreement, including without limitation the previous
agreements listed in the third recital of this Agreement.
15.13 Currency.
All monetary amounts set forth in this Agreement are in U.S. dollars.
15.14 Successors and Assigns.
Subject to Section 11.15, this Agreement shall inure to the benefit of and be binding upon
the Parties and their respective successors and permitted assigns
15.15 Prohibition on Private Activity Agreements.
The City and the Team agree that any agreement mentioned herein will not be structured
in any manner that the agreement would constitute "private activity" or would in any manner be
a violation of, or contrary to any ruling, regulation or law issued by the united States Internal
Revenue Service or in violation of any existing law or regulation.
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
by having their authorized representatives affix their signatures in the spaces below
CITY OF KENT-
B :
Y C2.70 —�
uzet Co ke, Mayor
Date 7
Approved as to Form:
By: il'U JW F N�e�ll
Toih B rerub rerub City Attorney
Date el-1 O
Team: THUNDERBIRD HOCKEY ENTERPRISES, LLC
By: �jk--
Name:
Its:
Date: v - 7- 7
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50831402 2
i
EXHIBIT A
WESTERN HOCKEY LEAGUE
ARENA FACILITY STANDARDS
EXHIBIT A
WESTERN HOCKEY LEAGUE
ARENA FACILITY STANDARDS
The Western Hockey League ("WHL") requires all Member Clubs to meet the following arena facility
standards
A. For the term of the lease agreement, the arena must provide the WHL club the following space at
the facility
1) Administrative office space in close proximity to the main entrance (minimum
3,500 sq ft),
2) Minimum twenty(20)permanent parking stalls in a prime parking location;
3) Home team dressing room (minimum 3,000 sq. ft.);
4) Off-ice training/fitness room(minimum 1,500 sq ft);
5) Storage space for hockey and administrative supplies(minimum 1,000 sq. ft);
B. For each WHL home game, the arena must make available the following space at the facility:
1) Prime parking space for visiting team bus,
2) Visiting team dressing room(minimum 1,000 sq. ft);
3) Dressing room for on-ice officials(minimum 100 sq. ft.);
4) Meeting room for off-ice officials(minimum 100 sq ft.),
5) A VIP hospitality/reception room (minimum 500 sq ft);
6) A media hospitality/reception room(minimum 200 sq. ft);
7) Adequate staffing for all event functions, including security personnel, ushers and box
office personnel,
8) Carpet/podium, as required, for on-ice ceremonies.
C The arena shall have a minimum seating capacity of 4,500 Seating capacity below the minimum
standard may be approved by the League provided it is deem appropriate for the size of the
market
D. Provide a certificate, outlining the maximum standing room capacity of the arena.
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508314022
E. The club shall have the right to sell in-arena advertising and retain revenues derived from the sale
of these rights
F. The club shall have the right to sell merchandise and retain revenues derived from the sale of
these rights
G The club shall be entitled to practice ice time in the arena as required during the hockey season at
no cost to the club, expressly for the purpose of holding preseason training camp and regular
practice sessions during the preseason, regular season and playoffs
H Services and facilities available within the arena must include.
1) Computerized ticket sales service to ensure maximum ticket distributions;
2) Suitable radio and television broadcast facilities (including broadcast booths for
television commentators)and interview areas,
3) Suitable Sound System for Music and PA Announcements;
4) Suitable Video Scoreboard for instant replay and promotions;
5) Media press box facilities capable of hosting a minimum twenty (20) media positions
Press box must have a minimum of two (2) phone Imes for media use Home teams are
required to provide two(2) seats for members of the visiting team staff, upon request,
6) Acceptable television camera position and arena lighting for live television broadcasts
(minimum 100 foot candle rating),
7) Acceptable power source for television broadcast facilities;
8) Area for promotional product displays and right to sample products within facility;
9) Acceptable hospitality areas/rooms for media results and hospitality for minimum
25 persons,
10) Acceptable hospitality areas/rooms for VIPs' and other accredited officials for minimum
25 persons,
11) Access to daily laundry, skate sharpening and equipment repair services;
12) Protective tarps,as required, over team and officials entrance areas;
13) Emergency medical response room and qualified medical personnel;
14) Access to public address system and electronic scoreboards
I. The arena playing surface, boards and player/penalty benches must conform to the League
playing rules and regulations as may be amended from time to time at the discretion of the
League
J The playing ice surface must be a minimum 200 x 85 feet.
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EXHIBIT B
CENTER ADVERTISING PRO FORMA
Exhibit B
Center Advertising Pro Forma
The standard for revenue derived by the City from Hockey-Event Advertising and Center
Advertising described in Sections 6 2 and 6.3 of this Agreement is enumerated below
Advertising Actual Net Adjusted Net Adjusted
Year Revenue Revenue Difference Revenue Difference
2008/09 $255,000 $ $ $ $
2009/10 261,375
2010/11 267,909
2011/12 274,607
2012/13 281,472
2013/14 288,509
2014/15 295,722
2015/16 303,115
2016/17 310,693
2017/18 318,460
2018/19 326,422
2019/20 334,582
2020/21 342,947
2021/22 351,520
2022/23 360,308
2023/24 369,316
2024/25 378,549
2025/26 388,013
2026/27 397,713
2027/28 407,656
2028/29 417,847
2029/30 428,293
2030/31 439,001
2031/32 449.976
2032/33 461.225
2033/34 472,756
2034/35 484,575
2035/36 496,689
2036/37 509,106
2037/38 521,834
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EXHIBIT C
TICKET/CONCESSIONS/CLUB SEATS REVENUE PRO FORMA
Exhibit C
Ticket/Concessions/Club Seats Revenue Pro Forma
Under the terms of Section 4.1(f) of this Agreement, the following are the standards for the net
revenues from the Regular Season Games of the Team from Net Ticket Proceeds, Net
Concession Sales, and Club Seats in each Operating Year of the agreement paid to the City.
Ticket Concession Club Total Actual Cumulative
Year Revenue Revenue Seats Revenue Revenue Balance
2008/09 $263,952 $359,910 $215,000 $838,862
2009/10 270,600 369,028 215,000 854,628
2010/11 277,247 378,145 215,000 870,392
2011/12 276,535 378,710 219,500 874,745
2012/13 279,703 383,455 219,500 882,658
2013/14 270,768 374,197 219,500 864,465
2014/15 277,683 383,453 224,000 885,138
2015/16 284,599 393,149 224,000 901,748
2016/17 291,691 402,846 224,000 918,537
2017/18 298,962 412,983 228,800 940,745
2018/19 306,409 423,120 228,900 958329
2019/20 314,034 433,698 228,800 976,532
2020/21 322,013 444,717 233,600 1,000,330
2021/22 329,993 455,736 233,600 1,019,329
2022/23 338,327 467,195 233,600 1,039,122
2023/24 346,661 478,655 238,700 1,064.016
2024/25 355,349 490,555 238,700 1,084.604
2025/26 364,215 502,896 238,700 1,105.811
2026/27 373,436 515,678 243,800 1,132,914
2027/28 382,657 528,459 243,800 1,154,916
2028/29 392,232 541,682 243,800 1,177,714
2029/30 401,984 555,345 248,900 1,206,229
2030/31 412,092 569,008 248,900 1,230,000
2031/32 422,376 583,112 248,900 1,254,388
2032/33 433,015 598,098 254,300 1,285,413
2033/34 443,832 612,643 254,300 1,310,775
2034/35 454,826 628,069 254,300 1,337,195
2035/36 466,152 643,936 259,700 1,369,988
2036/37 477,877 659,803 259,700 1,397,380
2037/38 489,935 676,551 259,700 1,426,186
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EXHIBIT D
GENERAL ADMISSION TARGETS
Exhibit D
Minimum Regular Seat Revenues
Under the terms of Section 4 l(c) of this Agreement, the following are the standards for general
admission paid attendance and revenue and attendance for Club Seats in each operating year of
the Agreement.
Average General General
General General Admission Admission Club Seat
Admission Admission Attendance Revenue Attendance
Year Seating Ticket Price Target Target Target
2008/09 190,260 $13.50 114,156 $1,541,106 300
2009/10 190,260 13.84 114,156 1,579,919 300
2010/11 190,260 14.18 114,156 1,618,732 300
2011/12 190,260 14.54 114,156 1,659,828 300
2012/13 190,260 14.90 114,156 1,700,924 300
2013/14 190,260 15.27 114,156 1,743,162 300
2014/15 190,260 15.66 114,156 1,787,683 300
2015/16 190,260 16.05 114,156 1,832,204 300
2016/17 190,260 16.45 114,156 1,877,866 300
2017/18 190,260 16 86 114,156 1,924,670 300
2018/19 190,260 17.28 114,156 1,972,616 300
2019/20 190,260 17.71 114,156 2,021,703 300
2020/21 190,260 18.16 114,156 2,073,073 300
2021/22 190,260 1861 114,156 2,124,443 300
2022/23 190,260 19.08 114,156 2,178,096 300
2023/24 190,260 1955 114,156 2,231,750 300
2024/25 190,260 2004 114,156 2,287,686 300
2025/26 190,260 20.54 114,156 2,3441764 300
2026/27 190,260 21.06 114,156 2,404,125 300
2027/28 190,260 2158 114,156 2,463,486 300
2028/29 190,260 22.12 114,156 2,525,131 300
2029/30 190,260 2267 114,156 2,587,917 300
2030/31 190,260 23.24 114,156 2,652,985 300
2031/32 190,260 23.82 114,156 2,719,196 300
2032/33 190,260 24.42 114,156 2,787,690 300
2033/34 190,260 2503 114,156 2,857,325 300
2034135 190,260 25.65 114,156 2,928,101 300
2035/36 190,260 2630 114,156 3,002,303 300
2036/37 190,260 26.95 114,156 3,076,504 300
2037/38 190,260 27.63 114,156 3,154,130 300
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EXHIBIT E
EVENTS CENTER SUITE SALES PRO FORMA
Exhibit E
Events Center Suite Sales Pro Forma
The standard for the net revenues paid to the City from the sale of Suite Licenses described in
Section 6.6 of this Agreement are enumerated below.
Suite Actual Net Adjusted Net Adjusted
Year Revenue Revenue Difference Revenue Difference
2008/09 $392,000 $ $ $ $
2009/10 392,000
2010/11 392,000
2011/12 401,800
2012/13 401,800
2013/14 401,800
2014/15 411,845
2015/16 411,845
2016/17 411,845
2017/18 422,141
2018/19 422,141
2019/20 422,141
2020/21 432,695
2021/22 432,695
2022/23 432,695
2023/24 433,512
2024/25 433,512
2025/26 433,512
2026/27 454,600
2027/28 454,600
2028/29 454,600
2029/30 465,965
2030/31 465,965
2031/32 465 965
2032/33 477,614
2033/34 477,614
2034/35 477,614
2035/36 489,554
2036/37 489,554
2037/38 489,554
E-1
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