HomeMy WebLinkAboutAD07-010 - Other - Amiga, Inc. - Unsuccessful Letter of Intent - 07/31/2007 Records M _ ge M e
O
KENT
WASH,NGTON Document
�a
= _ _ � .
CONTRACT COVER SHEET
This is to be completed by the Contract Manager prior to submission to City Clerks Office. All
portions are to be completed, if you have questions, please contact City Clerks Office.
Vendor Name: �rn Iq Vendor Number:
t� JD Edwards Number
Contract Number: ,0n / - n I o
This Is assigned by Deputy City Clerk
Description: L io,,fl-er T,
Detail:
Project Name: eve
Contract Effective Date: Termination Date:
Contract Renewal Notice (Days):
Number of days required notice for termination or renewal or amendment
Contract Manager: 4V 6� � Department: &CDA
Abstract:
5 Public\RecordsManagement\Forms\ContractCOver\ADCL7832 07/02
a
OFFICE OF THE MAYOR
Suzette Cooke, Mayor
220 4th Avenue South
Kent, WA 98032-5895
Fax 253-856-6700
•
KEN T Phone: 253-856-5700
WASHINGTOM I.K��^.M�Y-MSA9C'LX A9fiM4 �
July 31, 2007
--Via Certified and Regular Mail --
Bill McEwen, President
Amiga, Inc.
355 NW Gilman Blvd.
Issaquah WA 98027
Dear Mr. McEwen:
On April 17, 2007, the City of Kent(the "City"), Amiga, Inc. ("Amiga") and
Thunderbirds Hockey Enterprises, L.L.C. (the "Team") entered into a Letter of Intent-Naming
Rights Agreement that detailed the key principles of an arrangement under which the City would
transfer naming rights for its multi-purpose events center to Amiga for 20 years A key element
of the Letter of Intent was Amiga's commitment to make an up-front payment of$2,500,000 to
the City, followed by 15 annual payments of$500,000 each (with no payments in the last five
years). As the Letter of Intent noted, the parties had been negotiating the details of a definitive
agreement, and had worked out many of the terms, but there was not sufficient time to finalize
that contract prior to the announcement of the sale of naming rights to Amiga.
Subsequent to April 17, the City, in consultation with the Team, sent a draft naming
rights agreement to Amiga. After some time, lawyers for Amiga responded with a very different
agreement draft,one that contained a number of provisions that would be difficult for the City to
accept. Most importantly, the draft from Amiga did not provide for a$2,500,000 up-front
payment to the City. At that time, you stated that you would have your attorneys revise the
Amiga-proposed agreement so that it more accurately reflected the parties'joint intention on
April 17 Subsequent drafts from Amiga attorneys were similar to earlier versions, and the up-
front $2,500,000 payment to the City was missing. This was true of the most recent (July 24)
draft from lawyers for Amiga.
On July 11, 2007, the City sent you a letter in which it emphasized the need for
immediate action on a naming rights agreement that was consistent with the April 17
arrangement We noted that a definitive naming rights agreement would need to be executed by
July 20, with City receipt of a $2,500,000 payment by July 30. Neither of those events has
3 materialized.
a,
3
3
3
0 MAYOR SUZETTE COOKE
J
Bill McEwen, President
July 31, 2007
Page 2
The City and the Team have worked with Amiga in good faith to work out a final
agreement in a timely fashion—an agreement that is entirely consistent with the April 17 Letter
of Intent Nevertheless, the City's expectations under that Letter of Intent have not been met, and
the City has no intention of proceeding except under the previously agreed-upon terms
We regret that our agreements in the Letter of Intent did not result in a successful final
arrangement. However, the City is committed to a naming rights agreement that is fully
consistent with the City's project budget and financial plan. We wish your company the best in
the future.
Sincerely,
Su tie ooke, Mayor
Cc:
John Hodgson, Chief Administrative Officer
Russ Farwell, Thunderbirds General Manager
Tom Brubaker, Kent City Attorney
David Bowman, Peterson Russell Kelly PLLC
David P. Franklin, Esq. Reed Smith LLP