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STADIUM LEASE
THIS STADIUM LEASE (the
"Stadium Lease") is made as of the _____ day of July 1998, by
and between ERIE COUNTY STADIUM CORPORATION, a New York
business corporation and wholly-owned subsidiary of the New York
State Urban Development Corporation d/b/a the Empire State
Development Corporation, a public benefit corporation having an
office and principal place of business at 633 Third Avenue, New
York, New York 10017-6754 (the "ECSC") and BUFFALO
BILLS, INC., a New York business corporation having an office
and principal place of business at One Bills Drive, Orchard Park,
New York 14127 (the "Bills").
R E C I T A L S :
WHEREAS, the County of Erie (the
"County") is the owner of an approximately
135 acre parcel of real property situated in the Town of
Orchard Park, New York, which parcel is improved by a football
stadium and related amenities (the "Stadium Complex");
and
WHEREAS, pursuant to its rights
as a National Football League franchisee, the Bills are the
owners of the "Buffalo Bills" football team (the
"Team"); and
WHEREAS, pursuant to a certain
Agreement of Lease, dated as of October 15, 1971, between the
County and the Bills' predecessor in interest (as amended, the
"Original Lease"), the Team has used and occupied the
County's football stadium for its home games since 1973; and
WHEREAS, the term of the Original
Lease expires on July 31, 1998; and
WHEREAS, the County, New York
State (the "State") and the Bills have determined that
the Team encourages and fosters economic development and
prosperity for the citizens of Erie County and Western New York,
enhances the image of Erie County and Western New York and
provides recreational and other opportunities for the citizens of
Erie County and Western New York; and
WHEREAS, the citizens of Western
New York have supported and enjoyed the Team since its inception
such that the Team has become an integral part of the Western New
York community; and
WHEREAS, on January 12,
1998, the State, the County and the Bills entered into a
Memorandum of Understanding (the "MOU") setting forth
in principle certain actions to be undertaken by each of the
parties to enable the Team to continue to play its home games at
the County's football stadium through July 31, 2013; and
WHEREAS, pursuant to Chapter
_______ of the 1998 Session Laws of New York (the
"Authorizing Legislation"), the State has found and
declared, among other things, that the refurbishment, renovation,
improvement, operation, maintenance, repair and financing of the
Stadium Complex constitute a public and governmental purpose for
the benefit of the citizens of the County and the State, and has
specifically authorized the implementation of the various actions
contained in the MOU, including, without limitation, the
execution and delivery of this Stadium Lease and certain other
documents relating to the Stadium Complex; and
WHEREAS, certain of the actions
contained in the MOU relate to the refurbishing, renovation and
improvement of the Stadium Complex at a cost of approximately
$63.25 million; and
WHEREAS, under the New York State
Urban Development Act, Chapter 174 of the 1968 Laws of New York,
as amended (the "Act"), the New York State Urban
Development Corporation d/b/a the Empire State Development
Corporation (the "ESDC") is empowered to lease real
property from municipalities and to rehabilitate and improve such
real property; and
WHEREAS, pursuant to
Section 12 of the Act, the ESDC is empowered to create
subsidiary corporations and to confer upon such subsidiary
corporations all "privileges, immunities, tax exemptions and
other exemptions" which the ESDC enjoys, including, without
limitation, such privileges, immunities, tax exemptions and other
exemptions which enure to the ESDC by virtue of the ESDC's status
as a public benefit corporation; and
WHEREAS, on February 6,
1998, the ESDC filed a Certificate of Incorporation with the New
York Secretary of State forming the ECSC; and
WHEREAS, paragraph seven of such
Certificate of Incorporation provides that the ECSC shall enjoy
all of the "privileges, immunities, tax exemptions and other
exemptions" of the ESDC; and
WHEREAS, in the Authorizing
Legislation, the State has confirmed that the ECSC is a public
benefit corporation; and
WHEREAS, on February 27,
1998, the ESDC and the Bills entered into a Design Funding
Agreement pursuant to which the Bills have agreed to undertake
certain preliminary design and construction work related to the
refurbishing, renovation and improvement of the Stadium Complex;
and
WHEREAS, to implement the
refurbishing, renovation and improvement of the Stadium Complex,
the ECSC, the County and the Bills entered into a certain
Construction Coordinating Agreement dated as of July ___,
1998 (the "Construction Coordinating Agreement"); and
WHEREAS, pursuant to the terms of
the Construction Coordinating Agreement, the ECSC has agreed to
contract and pay for, and to oversee such refurbishing,
renovation and improvement; and
WHEREAS, to facilitate such
refurbishing, renovation and improvement, the County has leased
the Stadium Complex to the ECSC pursuant to a certain Master
Lease, dated as of July __, 1998, between the County, as
lessor, and the ECSC, as lessee; and
WHEREAS, the ECSC has agreed to
simultaneously sublease the Stadium Complex to the Bills on the
terms and conditions set forth in this Stadium Lease; and
WHEREAS, in its capacity as
"lead agency," the County has issued, on its own behalf
and on behalf of all other involved agencies, a "negative
declaration" under the New York State Environmental Quality
Review Act covering the refurbishing, renovation and improvement
of the Stadium Complex.
NOW, THEREFORE, for one dollar
($1.00) and other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the ECSC and the
Bills agree as follows:
ARTICLE 1 BASIC LEASE INFORMATION
1.1 Definitions. As used in this
Stadium Lease, the following terms shall have the meanings
ascribed thereto:
(a) Access Roads:
All paved roads and driveways now or hereafter
situated on the Land.
(b) Administration
Building: The approximately 60,000 square
foot, four-story building situated on the Land
immediately adjacent to the Stadium and presently
housing the Team's administrative offices,
portions of the County Facilities, certain of the
Luxury Suites and a concession commissary.
(c) Advertising
Rights: Any advertising or marketing of any
kind on or in the Stadium Complex including, but
not limited to, Scoreboard announcements,
Jumbotron announcements, Signage, ticket
advertising, Playing Field advertising, sponsor
advertising on concession or "give
away" merchandise, programs, year books and
all other print and display advertising
distributed at the Stadium Complex.
(d) Affiliate:
(i) As to any Person other than a
Governmental Authority, any other Person which
directly or indirectly controls, or is under
common control with, or is controlled by, such
Person, and (ii) as to any Governmental
Authority, any agency, department, board or
authority thereof. As used in this definition,
"control" (including, with its
correlative meanings, "controlled by"
and "under common control with") shall
mean possession, directly or indirectly, of power
to direct or cause the direction of management or
policies (whether through ownership of securities
or partnership or other ownership interests, by
contract or otherwise).
(e) Anniversary Date:
Each anniversary of the Commencement Date
occurring during the Term.
(f) Applicable Law:
Any applicable constitutional provision, treaty,
statute, rule, regulation, ordinance, order,
directive, code, interpretation, judgment,
decree, injunction, writ, determination, award,
permit, license, authorization, directive,
requirement or decision of or agreement with or
by a Governmental Authority now or hereafter in
effect.
(g) Assessments:
All special district charges and special
assessments of whatever kind and nature,
including water and sewer rents levied, imposed,
assessed or fixed on or against the Buildings and
the Land or arising from the use, occupancy or
possession thereof during the Term.
(h) Bills: Buffalo Bills, Inc., a
New York business corporation.
(i) Bills' Address:
400 Renaissance Center, Suite 2140
Detroit, Michigan 48243
Attention: Jeffrey C. Littmann,Treasurer
Telephone: (313) 259-9415
Telecopier: (313) 259-9101
With a copy at the same time and in the
same manner to:
Dykema Gossett
400 Renaissance Center
Detroit, Michigan 48243-1668
Attention: Lloyd A. Semple, Esq.
Michael A. Lesha, Esq.
Telephone: (313) 568-5392
Telecopier: (313) 568-6701
(j) Bills' Event:
Any public gathering at the Stadium which is
neither a Game nor a Civic Event.
(k) Bills'
Improvements: The additions, alterations and
improvements presently located at or affixed to
the Stadium Complex which are described in Exhibit A
attached to the Stadium Lease and such other
additions, alterations or improvements to the
Stadium Complex as may be undertaken by the Bills
at the Bills' sole cost and expense in accordance
with the terms and conditions of the Stadium
Lease.
(l) Bills' Insurance
Policy: Any policy of insurance maintained by
the Bills pursuant to Article 18 of the
Stadium Lease.
(m) Books and Records:
Those portions of the Bills' business books and
records pertaining to Game Day Expenses,
Operating Expenses, Marketing Expenses, Licenses
Fees and Net Ticket Revenues (which shall
include, but not be limited to, all information
supplied to the Bills by the NFL with respect to
NFL Average Net Ticket Revenue).
(n) Broadcast Rights:
All radio and television broadcasting, film or
tape reproductions, closed circuit, cable or pay
television or radio rights and similar rights by
whatever means or process, now existing or
hereafter developed, for preserving,
transmitting, disseminating or reproducing for
hearing or viewing events at the Stadium Complex.
(o) Budget: The
term "Budget" shall have the meaning
ascribed thereto in the Construction Coordinating
Agreement.
(p) Buildings:
The Stadium, the Administration Building, the
Field House, the Training Center and any other
building or enclosed structure now or hereafter
situated on the Land.
(q) Capital
Improvement: (i) Any Structural Repair; (ii)
any single addition, alteration, demolition,
improvement or refurbishing of or to the Stadium
Complex or any portion thereof the cost or
expense of which is classified as a capital
expense by GAAP; (iii) any single addition,
alteration, demolition, improvement or
refurbishing of or to the Stadium Complex or any
portion thereof the cost or expense of which is
$10,000 or more; or (iv) any series of
additions, alterations, demolitions, improvements
or refurbishings of or to the Stadium Complex or
any portion thereof that (1) under ordinary and
customary business practices would be clearly
viewed as being a single project, (2) under
ordinary and customary business practices would
be effectuated by entering into a single contract
with a contractor or other applicable Person, and
(3) has a cost of $10,000 or more.
(r) Capital
Improvement Allowance: (i) During the
first Lease Year, the Minimum Capital Improvement
Allowance; and (ii) during each subsequent
Lease Year, such other amount as may be
calculated in accordance with Section 10.3
of the Stadium Lease.
(s) Capital
Improvement Expense: Any expense paid or
incurred in making a Capital Improvement.
(t) Casualty: Any
Major Casualty or Minor Casualty.
(u) Casualty
Insurance Premium Cap: The rate of seven and
one-half cents ($.075) per one hundred dollars
($100) of insurance coverage.
(v) Civic Event:
Any event or public gathering at the Stadium
Complex sponsored by either the County or the
ECSC pursuant to Section 2.3 of the
Stadium Lease, the primary purpose of which is
the promotion of civic, community, governmental
or charitable purposes (as opposed to pecuniary
gain), and which does not compete with the Bills'
use of the Stadium Complex as a venue for
professional football contests and musical
concerts and festivals.
(w) Civic Event
Expenses: The actual, incremental
out-of-pocket expenses incurred by the Bills in
their capacity as operator of the Stadium Complex
with respect to any Civic Event, including,
without limitation, the cost of repairing any
damage to any component of the Stadium Complex
arising out of a Civic Event and not covered by
any applicable insurance policy.
(x) Club Level Seats:
Any spectator's seat within the "club
level" of the Stadium (other than a seat
within a Luxury Suite) for which a License Fee is
charged by the Bills.
(y) Commencement Date:
August 1, 1998.
(z) Construction
Coordinating Agreement: The Construction
Coordinating Agreement, dated as of
July ____, 1998, by and among the ECSC, the
County and the Bills, together with all renewals,
replacements, modifications and amendments
thereof.
(aa) County: The
County of Erie, a New York municipal corporation.
(bb) County's Address:
Department of Public Works
95 Franklin Street
Buffalo, New York 14202
Attention: Commissioner of Public Works
Telephone: (716) 858-8306
Telecopier: (716) 858-8303
with a copy at the same time and in the same manner to:
Erie County Attorney's Office
69 Delaware Avenue, Suite 300
Buffalo, New York 14202
Attention: County Attorney
Telephone: (716) 858-2200
Telecopier: (716) 858-2281
(cc) County
Facilities: The approximately three hundred
fourteen (314) square foot office located in the
"tunnel" level of the Administration
Building presently used to house the County's
maintenance office.
(dd) Default Interest
Rate: A rate per annum that is the lesser of
(a) four percent above the interest rate
charged from time to time by Manufacturers and
Traders Trust Company or its successor as its
prime commercial or similar reference rate, or
(b) the maximum nonusurious rate permitted
by Applicable Law.
(ee) Design Funding
Agreement: The Design Funding Agreement,
dated February 27, 1998, between the ESDC
and the Bills, together with all renewals,
replacements, modifications and amendments
thereof.
(ff) Development
Study: The Development Study & Report
prepared by DiDonato Associates, P.E., P.C., et
al. dated February, 1997.
(gg) ECSC: Erie
County Stadium Corporation, a New York business
corporation and wholly-owned subsidiary of the
ESDC.
(hh) ECSC's Address:
c/o Empire State Development Corp.
633 Third Avenue
New York, New York 10017-6754
Attention: General Counsel
Telephone: (212) 803-3750
Telecopier: (212) 803-3775
(ii) ECSC Project
Costs: The term "ECSC Project
Costs" shall have the meaning ascribed
thereto in the Construction Coordinating
Agreement.
(jj) Environment:
Water or water vapor, land surface or subsurface,
air, fish, wildlife, biota and all other natural
resources.
(kk) Environmental
Claims: Any notice of violation, notice of
potential or actual responsibility or liability,
or written claim, suit, action, demand, directive
or order (including those for contribution and/or
indemnity) by any Governmental Authority or other
Person for any damage (including, but not limited
to, personal injury, tangible or intangible
property damage, natural resource damage,
indirect or consequential damages, investigative
costs, removal, response or remediation costs,
nuisance, pollution, contamination or other
adverse effects on the environment or for fines,
penalties or restrictions or conditions on
existing environmental permits or licenses)
resulting from or relating to (i) the
presence of, a Release or threatened Release into
the environment of, or exposure to, any Hazardous
Substance, (ii) the generation, manufacture,
processing, distribution, use, handling,
transportation, storage, treatment or disposal of
any Hazardous Substances, (iii) the
violation, or alleged violation, of any
Environmental Laws or (iv) the
non-compliance or alleged non-compliance with any
Environmental Laws.
(ll) Environmental
Laws: Any applicable, or relevant and
appropriate, statutes, ordinances, by-laws,
directives or other written, published laws, any
written, published rules or regulations, orders,
and any licenses, permits, orders, judgments,
notices or other requirements issued pursuant
thereto, enacted, promulgated or issued by any
Governmental Authority, now or hereafter in
effect, relating to pollution or protection of
public health or the environment from Hazardous
Substances (including, but not limited to, any
air, surface water, groundwater, land surface or
sub-surface strata, whether outside, inside or
under any structure), or to the identification,
reporting, generation, manufacture, processing,
distribution, use, handling, treatment, storage,
disposal, transporting, presence, Release or
threatened Release, of any Hazardous Substances.
Without limiting the generality of the foregoing,
Environmental Laws shall include the
Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as
amended, the Toxic Substances Control Act, as
amended, the Hazardous Materials Transportation
Act, as amended, the Resource Conservation and
Recovery Act, as amended, the Clean Water Act, as
amended, the Safe Drinking Water Act, as amended,
the Clean Air Act, as amended, and all analogous
laws enacted, promulgated or lawfully issued by
any Governmental Authority.
(mm) ESDC: The
New York State Urban Development Corporation
d/b/a the Empire State Development Corporation, a
New York public benefit corporation having an
office and principal place of business at
633 Third Avenue, New York, New York
10017-6754.
(nn) Fall Out Amount:
The aggregate amount during Lease Years two
through six by which License Fee Payment Defaults
exceed five million nine hundred-thousand dollars
($5,900,000).
(oo) Field House:
The approximately 98,000 square foot field house
situated on the Land commonly known as the
"Ralph C. Wilson, Jr. Field House"
presently housing the Team's indoor practice
facility.
(pp) Force Majeure:
Any of the following events: strikes, lockouts,
labor disputes, embargoes, flood, earthquake,
storm, dust storm, lightning, fire, epidemic,
acts of God, war, national emergency, civil
disturbance or disobedience, riot, sabotage,
terrorism, threats of sabotage or terrorism,
restraint by court order or order of public
authority, and similar occurrences beyond the
reasonable control of the party in question
(financial inability excepted), that make
compliance with any of its material obligations
under any of the Stadium Agreements in a timely
manner impracticable or impossible.
(qq) Franchise:
The franchise granted by the NFL to the Bills
pursuant to which the Bills own and operate an
NFL Team, as evidenced by the "Franchise
Certificate of Membership" issued by the
NFL.
(rr) Franchise
Maintenance Covenants: The covenants of the
Bills set forth in Sections 6.1, 6.3 and
6.4 of the Stadium Lease.
(ss) GAAP: With
respect to all accounting matters and issues,
generally accepted accounting principles in
effect from time to time.
(tt) Game: Any
Home Game or Home Playoff Game.
(uu) Game Day Expense
Portion: Thirty-seven percent (37%) of the
Operating/Game Day Expense Reimbursement for any
Lease Year.
(vv) Game Day
Expenses: Any expense paid or incurred on the
day of any Game for security, ushers, ticket
takers, cleaning, garbage removal and emergency
medical services at the Stadium Complex.
(ww) Governmental
Authority: Any federal, state or local
government, or any political subdivision of any
of the foregoing, or any court, agency or other
entity, body, organization or group, exercising
any executive, legislative, judicial,
quasi-judicial, regulatory or administrative
function of government.
(xx) Hazardous
Substances: Any pollutants, contaminants,
substances, hazardous and/or toxic chemicals,
carcinogens, wastes, and any ignitable,
corrosive, reactive, toxic or other hazardous
substances or materials, whether solids, liquids
or gases (including, but not limited to,
petroleum and its derivatives, PCBs, asbestos,
radioactive materials, waste waters, sludge, slag
and any other substance, material or waste), as
defined in or regulated by any Environmental Laws
or as determined by any Governmental Authority.
(yy) Home Game:
Each Pre-Season Game and Regular Season Game
between the Team and any other NFL Team, which is
designated by the NFL in its official schedule as
a "home game" for the Team.
(zz) Home Playoff
Game: Each Post-Season Game between the Team
and any other NFL Team, which is designated by
the NFL in its official post season schedule as a
"home game" for the Team.
(aaa) Initial ECSC
Investment: The aggregate of the actual
amounts paid by the ECSC (or by the ESDC on
behalf of the ECSC) pursuant to (i) the Design
Funding Agreement and the Construction
Coordinating Agreement in conjunction with design
and construction of the Project, (ii) the Master
Lease and the Stadium Lease in satisfaction
and/or repayment of the additional rent
obligations of the Bills pursuant to the terms of
the Original Lease, and (iii) the Stadium Lease
for Working Capital Assistance during the first
six Lease Years.
(bbb) Jumbotron:
The SONY Jumbotron screen, front end video system
and scoreboard, matrix and advertising display
system presently situated at the Stadium,
together with any modifications, upgrades and
replacements thereof.
(ccc) Land: The
land described on Exhibit B to the Stadium
Lease.
(ddd) Lease Date:
July , 1998.
(eee) Lease Year:
The twelve (12) month period beginning on the
Commencement Date and ending on the last day of
the twelfth (12th) successive calendar month, and
each succeeding twelve (12) month period
thereafter during the Term.
(fff) License
Agreement: A written agreement, in the form
required by Sections 4.8 and 4.9
of the Stadium Lease, between the Bills and any
Licensee for the use of a Club Level Seat or
Luxury Suite.
(ggg) License Fee:
Any premium or license fee charged by the Bills
for the use of a Club Level Seat or Luxury Suite
in excess of the stated admission ticket price.
(hhh) License Fee
Deficit: The amount in any Lease Year by
which the Qualifying License Fee Amount exceeds
the total of all License Fees collected by the
Bills during such Lease Year which is
attributable to License Fee Payment Defaults.
(iii) License Fee
Payment Default: The default by any Licensee
in the payment when due of all or any portion of
the License Fee payable by such Licensee pursuant
to the terms of its License Agreement following
the exercise by the Bills of commercially
reasonable collection efforts, which efforts need
not, however, require the commencement of legal
proceedings.
(jjj) Licensee:
Any Person who contracts with the Bills for the
use of a Club Level Seat or Luxury Suite.
(kkk) Lien: Any
lien, statutory lien, pledge, condemnation award,
claim, restriction, charge, security interest,
mortgage, assignment, title defect, lease,
tenancy, license, covenant, right of way,
easement, encroachment, right of refusal or
encumbrance of any nature whatsoever.
(lll) Losses: All
losses, liabilities, deficiencies, damages
(including without limitation consequential
damages), fines, penalties, claims, costs and
expenses (including, without limitation all
fines, penalties and other amounts paid pursuant
to a judgment, compromise or settlement), court
costs and reasonable legal and accounting fees
and disbursements.
(mmm) Luxury Suites:
The enclosed suites at the Stadium and in the
Administration Building, consisting of ninety
(90) existing suites and seventy-four (74) suites
to be constructed as described in the Development
Study.
(nnn) Major Casualty:
Any damage to the Stadium Complex caused by fire,
storm, earthquake, tornado, flood, natural
disaster or other sudden, unexpected or unusual
occurrence which renders ten percent (10%) or
more of the total seating capacity of the Stadium
unusable for a period in excess of thirty (30)
days.
(ooo) Marketing
Allowance: Provided the Bills shall have paid
or incurred at least $750,000 in Marketing
Expenses between August 1, 1997 and
December 1, 1998, the sum of $375,000 and
sixty-seven percent (67%) of the amount by which
the Marketing Expenses paid or incurred by the
Bills during such period exceeds $750,000.
(ppp) Marketing
Campaign: The marketing campaign to be
carried out by ECSC and the Bills prior to
December 1, 1998, the object of which shall be to
secure binding License Agreements for terms of
not less than five (5) years each, which will
produce aggregate License Fees for the 1999 NFL
Season equal to or greater than the Qualifying
License Fee Amount.
(qqq) Marketing
Expenses: All actual, incremental
out-of-pocket expenses paid or incurred by the
Bills for the marketing of Club Level Seats and
Luxury Suites.
(rrr) Master Lease:
The Master Lease, dated as of July ___,
1998, by and between the County, as lessor, and
the ECSC, as lessee, pursuant to which the ECSC
leases the Stadium Complex, together with all
renewals, replacements, modifications and
amendments thereof.
(sss) Master Lease
Expiration Date: July 31, 2013, or such
earlier date provided for in the Master Lease
upon which the Master Lease Term shall expire.
(ttt) Master Lease
Term: The term of the Master Lease, beginning
on the Commencement Date and ending on the Master
Lease Expiration Date.
(uuu) Material
Sublessee Default: (i) Any Sublessee
Default arising out of the breach of a Franchise
Maintenance Covenant; (ii) any single
Sublessee Default arising out of the failure by
the Bills to pay any sum in excess of one-hundred
thousand dollars ($100,000); (iii) any
series of Sublessee Defaults which arise out of
the failure by the Bills to pay in the aggregate
any sum in excess of one-hundred thousand dollars
($100,000); or (iv) any other Sublessee
Default which remains outstanding for a period in
excess of one hundred and fifty (150) days
(unless said Sublessee Default cannot be cured
within said one-hundred and fifty (150) day
period, in which case said period shall be
extended as long as the Bills are diligently
pursuing a cure).
(vvv) Material
Sublessor Default: (i) Any Sublessor
Default arising out of the failure by the County
to restore the Stadium Complex in accordance with
Article 12 or 13 of the Stadium
Lease; (ii) any single Sublessor Default
arising out of the failure by the County and/or
the ECSC, as the case may be, to pay any sum due
hereunder in excess of one million dollars
($1,000,000); or (iii) any series of
Sublessor Defaults arising out of the failure by
the County and/or the ECSC, as the case may be,
to pay in the aggregate any sum in excess of one
million dollars ($1,000,000); or (iv) any
Sublessor Default that results in loss or damage
to the Bills in excess of one million dollars
($1,000,000).
(www) Minimum Capital
Improvement Allowance: $2,100,000.
(xxx) Minor Casualty:
Any damage to the Stadium Complex caused by fire,
storm, earthquake, tornado, flood, natural
disaster or other sudden, unexpected or unusual
occurrence which does not render ten percent
(10%) or more of the total seating capacity of
the Stadium unusable for a period in excess of
thirty (30) days.
(yyy) Net Ticket
Deficit: The amount by which NFL Average Net
Ticket Revenue exceeds Net Ticket Revenue in any
Lease Year.
(zzz) Net Ticket
Revenue: For any Lease Year, the gross
consideration received by the Bills (including
the value of any complimentary tickets,
promotional consideration and in-kind services to
the extent such items are included under the NFL
Rules and Regulations in calculating the visiting
team's share of ticket revenue) for admission
tickets to Home Games, exclusive of any
applicable taxes, License Fees and NFL Approved
Surcharges.
(aaaa) NFL: The
National Football League, an unincorporated,
nonprofit association, having an office and
principal place of business at 280 Park
Avenue, New York, New York 10017.
(bbbb) NFL Approved
Surcharges: Any special ticket handling or
ticket service charges that are allowed as a
deduction under the NFL Rules and Regulations as
of the Lease Date in calculating the visiting
team's share of ticket revenue, and any special
ticket handling or ticket service charges imposed
after the Lease Date that are allowed as a
deduction under the NFL Rules and Regulations in
calculating the visiting team's share of ticket
revenue and which are not preferential to any one
NFL Team.
(cccc) NFL Average
Net Ticket Revenue: For any NFL Season, the
average per team gross consideration received by
all NFL teams (including the value of any
complimentary tickets, promotional consideration
and in-kind services to the extent such items are
included under the NFL Rules and Regulations in
calculating the visiting team's share of ticket
revenue) for admission tickets to
"home" Pre-season Games and
"home" Regular Season Games, exclusive
of any applicable taxes, club seat and luxury
suite premiums and license fees and NFL Approved
Surcharges.
(dddd) NFL Rules and
Regulations: The constitution, bylaws, rules,
regulations, policies and practices of the NFL in
effect from time to time, relevant excerpts of
which are attached to the Stadium Lease as Exhibit C.
(eeee) NFL Season:
The period of time beginning on the day on which
the first Pre-Season Game is played through the
date on which the last Post-Season Game is played
in a given Lease Year, encompassing, therefore,
all Pre-Season Games, Regular Season Games and
Post-Season Games in a given Lease Year.
(ffff) NFL Team:
A professional football team operated pursuant to
a franchise granted by the NFL.
(gggg) Operating
Expenses: (i) All wages, salary and
employer-paid taxes, insurance and employee
benefits for Stadium management and maintenance
personnel; (ii) all out-of-pocket costs that are
not included in clause (i) above for Stadium
Complex maintenance and management (including,
but not limited to, all expenses incurred for
Scoreboard maintenance and repair, general
maintenance and repair, cleaning and toiletry
supplies and grounds and park maintenance); (iii)
all liability insurance covering the Stadium
Complex; and (iv) all charges for water, natural
gas and electricity consumed at the Stadium
Complex; but shall not under any circumstances,
be construed to include any Civic Event Expenses,
any Game Day Expenses, any Capital Improvement
Expenses and any wages, salary or employer-paid
taxes, insurance and employee benefits for
employees who are not directly and principally
responsible for the operation, repair,
maintenance or control of the Stadium Complex (in
particular, but not necessarily limited to,
players, coaches, trainers and other football
operations personnel).
(hhhh) Operating/Game
Day Expense Reimbursement: The amount payable
by the ECSC to the Bills pursuant to Section 9.4
of the Stadium Lease during each Lease Year to
reimburse the Bills for Operating Expenses and
Game Day Expenses paid or incurred by the Bills
during such Lease Year.
(iiii) Operating/Game
Day Expense Reimbursement Cap: $2,915,000
[need to add amount for insurance of Game Day
Expenses] or such higher amount as may be
calculated in accordance with Section 9.5
of the Stadium Lease.
(jjjj) Operating/Game
Day Expense Reimbursement Date:
August 1, November 1, February 1
and May 1 of any Lease Year.
(kkkk) Original Lease:
The Agreement of Lease, dated as of
October 15, 1971, between the County, as
landlord, and the Bills' predecessor in interest,
as tenant, as amended.
(llll) Parking Areas:
All parking lots now or hereafter situated on the
Land.
(mmmm) Party: Any
one of the County, the ECSC or the Bills.
(nnnn) Permitted
Assignee: Any Person which (i) succeeds to
the ownership of all or substantially all of the
assets of the Bills, including in any event the
Franchise, (ii) assumes in writing, by
documentation reasonably acceptable to the County
and the ECSC, all of the obligations of the Bills
under the Stadium Agreements, and (iii) is
approved by the NFL in accordance with the NFL
Rules and Regulations as the owner of the
Franchise.
(oooo) Person:
Any Governmental Authority, individual,
association, joint venture, partnership,
corporation, limited liability company, trust or
other entity.
(pppp) Playing Field:
The area within the Stadium designed for the
playing of NFL football games, including the
delineated field of play, all sideline areas and
all other surfaces immediately surrounding the
delineated field of play.
(qqqq) Players'
Strike: Any players "lockout"
sanctioned or otherwise approved by the NFL or a
majority of the holders of NFL franchises, or
strike or other work stoppage sanctioned or
otherwise approved by the NFL Players'
Association or other properly certified
collective bargaining unit representing NFL
player personnel.
(rrrr) Post-Season
Games: The total schedule of all playoff,
championship and "Super Bowl" football
games played by NFL Teams.
(ssss) Practice
Facilities: The outdoor practice field and
related amenities situated on the Land.
(tttt) Pre-Season
Games: The total schedule of all football
games played by NFL Teams in a given NFL Season
prior to the commencement of the Regular Season
Games.
(uuuu) Price Index:
The Consumer Price Index for all Urban Consumers:
All Items (CPI-U), U.S. City Average
(1993-1995=100), or if a substantial change is
made in the manner of calculating such index or
if such index or a successor or substitute index
is not available, a reliable governmental or
other non-partisan publication evaluating as
nearly as possible the same underlying economic
indicators as such index.
(vvvv) Proceeding:
Any claim, demand, action, suit, litigation,
dispute, order, writ, injunction, judgment,
assessment, decree, grievance, arbitral action,
investigation or other proceeding.
(wwww) Project:
The refurbishing, renovation and improvement of
the Stadium Complex, as described in the
Construction Coordinating Agreement.
(xxxx) Project
Agreement: The term "Project
Agreement" shall have the meaning ascribed
thereto in the Construction Coordinating
Agreement.
(yyyy) Project
Insurance Policy: The term "Project
Insurance Policy" shall have the meaning
ascribed thereto in the Construction Coordinating
Agreement.
(zzzz) Qualifying
License Fee Amount: For any Lease Year, the
amount set forth on Exhibit D
attached to the Stadium Lease.
(aaaaa) Recoupment
Amount: The sum of: (i) the Fall Out Amount;
and (ii) the aggregate sum for all Lease Years of
the amount by which the Total Deficit exceeds
$5,000,000 in each such Lease Year; provided,
however, that to the extent an amount
attributable to a License Fee Payment Default is
included in the calculations of the Fall Out
Amount, such amount shall be excluded from the
calculations of the Total Deficit.
(bbbbb) Regular
Season Games: The total schedule of all
football games played by NFL Teams used by the
NFL to determine which NFL Teams participate in
Post-Season Games.
(ccccc) Release:
Any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting,
escaping, leaching, migration, dumping or
disposing into the environment which could give
rise to an Environmental Claim or which is
required to be reported pursuant to 40 C.F.R. 302
or 355, or any analogous Environmental Law.
(ddddd) Reserved
Areas: (i) The concession and merchandise
vending areas of the Stadium Complex; (ii) the
Luxury Suites; (iii) the Stadium Club;
(iv) the Stadium press box; (v) the
Field House and (vi) the Team's
administrative offices, locker rooms and training
rooms.
(eeeee) Satisfaction:
The receipt by the Bills of binding License
Agreements for terms of not less than five (5)
years each, which will produce aggregate License
Fees at least equal to Eleven Million Dollars
($11,000,000) for the 1999 NFL Season.
(fffff) Scoreboards:
The sound system, public address system, message
boards and game clocks now or hereafter situated
within the Stadium.
(ggggg) Signage:
All signage (permanent or temporary) in or on the
Stadium Complex, including, without limitation,
the Scoreboards, Jumbotron or other replay
screens, banners, displays, time clocks, message
centers, advertisements and signs.
(hhhhh) Stadium:
The football stadium situated on the Land, which
includes, without limitation, the Club Level
Seats, the Jumbotron, the Luxury Suites and the
Playing Field.
(iiiii) Stadium
Affirmative Action Plan: The affirmative
action plan for the Stadium Complex attached
hereto as Exhibit E.
(jjjjj) Stadium
Agreements: The Construction Coordinating
Agreement, the Design Funding Agreement, the
Master Lease and the Stadium Lease.
(kkkkk) Stadium Club:
The restaurant facilities within the Stadium that
are reserved for the exclusive use by Club Seat
ticket holders.
(lllll) Stadium
Complex: The Access Roads, the Buildings, the
Land, the Parking Areas and the Practice
Facilities.
(mmmmm) Stadium
Events: All Games, Civic Events and Bills
Events.
(nnnnn) Stadium Lease:
The Stadium Lease, dated as of July __,
1998, between the ECSC, as sublessor, and the
Bills, as sublessee, together with all renewals,
replacements, modifications and amendments
hereof.
(ooooo) Stadium Lease
Expiration Date: July 30, 2013, or such
earlier date provided for in the Stadium Lease
upon which the Stadium Lease Term shall expire.
(ppppp) Stadium Lease
Term: The term of the Stadium Lease,
beginning on the Commencement Date and ending on
the Stadium Lease Expiration Date.
(qqqqq) Stadium
Patron: Any Person on or at the Stadium
Complex during a Stadium Event.
(rrrrr) State: The State of New
York.
(sssss) Structural
Repair: Any repair or replacement of a
structural nature to the Stadium, the
Administration Building, the Field House or the
Training Center, including, without limitation,
all necessary repairs and replacements of the
roof, foundation, doors, windows, loadbearing
walls and Playing Field surface.
(ttttt) Sublessee
Default: Any of the events listed in Section 24.1
of the Stadium Lease.
(uuuuu) Sublessor
Default: Any of the events listed in Section 25.1
of the Stadium Lease.
(vvvvv) Suite Corp.:
Buffalo Bills Suite Corp., a New York business
corporation having an office and principal place
of business at One Bills Drive, Orchard Park, New
York 14127.
(wwwww) Survey:
The survey of the Stadium Complex a reduced copy
of which is attached hereto as Exhibit F.
(xxxxx) Taking:
Any appropriation for public purposes, taking by
right of eminent domain or other condemnation
proceeding initiated by any Governmental
Authority with respect to all or any portion of
the Stadium Complex.
(yyyyy) Team: The
NFL Team owned by the Bills pursuant to the
Franchise currently named "Buffalo
Bills".
(zzzzz) Term: As
used in the Master Lease, the Master Lease Term,
and as used in the Stadium Lease, the Stadium
Lease Term.
(aaaaaa) Termination
Date: July 30th of the Lease Year in which
the Bills exercise their option to cancel the
Stadium Lease pursuant to Section 7.2
thereof.
(bbbbbb) Termination
Fee: The amount set forth in Exhibit G
attached to the Stadium Lease to be paid by the
Bills to the ECSC upon the exercise of the Bills'
option to cancel the Stadium Lease pursuant to Section 7.2
thereof.
(cccccc) Total
Deficit: The sum of the Net Ticket Deficit
and the License Fee Deficit for any Lease Year.
(dddddd) Training
Center: The approximately 75,000 square foot
training center and Team operations facility to
be constructed on the Land as part of the
Project, as described in the Development Study.
(eeeeee) Transfer of
Ownership: Any direct or indirect sale,
transfer, assignment or other conveyance of
(i) the Franchise (or any interest(s)
therein) in whole or in part, or (ii) the
acquisition by any Person (other than
Ralph C. Wilson, Jr., his spouse, any trust
or other entity controlled by him or any of his
lineal descendants) of beneficial ownership
(within the meaning of Rule 13d-3
promulgated under the Securities Exchange Act of
1934) of fifty-one percent (51%) or more of the
capital stock of the Bills (whether acquired in
one or more transactions).
(ffffff) Unaffiliated
Vendors: Any Person not employed by the Bills
or by the concessionaire selected by the Bills
and approved by the County in accordance with Section 4.5
of the Stadium Lease who sells, offers for sale
or otherwise attempts to sell any food, beverage
or merchandise of any kind or nature whatsoever
on the grounds of the Stadium Complex outside of
the Stadium.
(gggggg) Unamortized
Initial ECSC Investment: The unamortized
balance, on a given date, of the Initial ECSC
Investment, as set forth on Exhibit H
attached to the Stadium Lease. [Exhibit to
consist of straight-line amortization schedule
for $98.25 million over a one hundred and eighty
month period based upon the Default Interest Rate
as of the Lease Date.]
(hhhhhh) Unspent
Capital Improvement Allowance: For any Lease
Year, the amount by which the Capital Improvement
Allowance exceeds the amount expended by the
County for Structural Repairs.
(iiiiii) Working
Capital Assistance: The amounts to be paid by
the ECSC to the Bills pursuant to Section 11.1
of the Stadium Lease.
(jjjjjj) Vending Plan:
The plan, a copy of which is attached to the
Stadium Lease as Exhibit I, outlining
(i) the process for the selection,
operation, regulation and governance of vending
by Unaffiliated Vendors on those portions of the
Stadium Complex outside of the Stadium and
(ii) the opportunities for non-profit and
charitable organizations to operate concession
stands within the Stadium.
(kkkkkk) Voucher:
The form of voucher attached to the Master Lease
as Exhibit __.
If any other provision of this Stadium
Lease contradicts any definition of this Article, such other
provision will prevail.
1.2 Exhibits and Schedules. The
following exhibits and schedules are attached to and made a part
of this Stadium Lease:
EXHIBIT A -- Description of
Bills' Improvements
EXHIBIT B -- Description of the
Land
EXHIBIT C -- NFL Rules and
Regulations
EXHIBIT D -- Qualifying License
Fee Amounts
EXHIBIT E -- Stadium Affirmative
Action Plan
EXHIBIT F -- Survey
EXHIBIT G -- Termination Fee
EXHIBIT H -- Amortization
Schedule for Initial ECSC Investment
EXHIBIT I -- Vending Plan
EXHIBIT J -- County Local Law
No. 2-1994
EXHIBIT K -- Concessionaire
Insurance Requirements
EXHIBIT L -- Suite and Club Seat
License Agreements
EXHIBIT M -- County Local Law
No. 5-1996
EXHIBIT N -- Section 7.1 Notice
EXHIBIT O -- NFL Counsel Opinion
SCHEDULE 9.4 -- Schedule of Operating/Game Day Expense Reimbursement Payments
ARTICLE 2 DEMISE
2.1 Grant of Sublease. The ECSC
hereby subleases the Stadium Complex to the Bills, and the Bills
hereby sublease the Stadium Complex from the ECSC, for the Term,
on the terms and conditions set forth in this Stadium Lease.
2.2 Reservation of County Facilities.
As provided in Section 2.2 of the Master Lease, at all times
during the Term, the County Facilities shall be reserved for the
exclusive use and occupancy of the County. The Bills covenant and
agree that at all times during the Term, the County shall have
the right to access and use, on a non-exclusive basis, consistent
with existing practice, all first aid and security areas within
the Stadium.
2.3 Civic Events. Other than
during the NFL Season, the Bills shall make the Stadium Complex
available for up to four (4) Civic Events per Lease Year on the
following terms and conditions:
(a) Three (3) of such Civic Events shall
be available for use by the County or any Person designated by
the County, and one (1) of such Civic Events shall be available
for use by the ECSC or any Person designated by the ECSC.
(b) At least forty-five (45) days but
not more than one-hundred and eighty (180) days prior to the date
of the proposed Civic Event, the County or the ECSC, as the case
may be, shall notify the Bills in writing of the requested date
for such event and shall identify in all material respects to the
extent then known the nature of the event, the sponsor, the areas
of the Stadium Complex to be utilized, the terms (including
ticket prices) of admission, the expected attendance, any special
security or other arrangements and any other relevant information
reasonably necessary for the Bills to perform their duties as the
operator of the Stadium Complex. The notifying party shall update
the content of such notice from time to time promptly upon
becoming aware of any changes in the information given above and
any additional relevant information of the type described above.
Upon its receipt of a notice requesting the scheduling of a Civic
Event, the Bills shall reserve such date for such Civic Event
(unless such date has been previously reserved for another
Stadium Event) and shall not schedule any other subsequently
proposed Stadium Event on such date without written approval from
the County or the ECSC, as the case may be.
(c) In no event shall any Civic Event be
scheduled on any date that has been previously reserved for a
Bills' Event or another Civic Event. The County, the ECSC and the
Bills shall exercise good faith and cooperate with one another in
the event of potential conflicts that may arise between proposed
events.
(d) In no event shall any Civic Event be
a professional football game or other professional sporting
contest, nor shall any Civic Event include an event or activity
which reasonably may be expected to cause damage to the Playing
Field which will not be repaired in a timely fashion.
(e) The Bills shall promptly invoice the
County or the ECSC, as the case may be, for all Civic Event
Expenses following any Civic Event which it sponsors, and shall
include
with such invoice copies of appropriate
back-up documentation evidencing such Civic Event Expenses.
Within forty-five (45) business days of the receipt by the County
or the ECSC of any such invoice, the recipient shall, at its sole
cost and expense, reimburse the Bills for all invoiced Civic
Event Expenses.
(f) The County and the ECSC shall each
retain the admission ticket revenue (if any) from any Civic Event
which it sponsors.
(g) All Licensees who seek to use their
Luxury Suite or Club Level Seat in conjunction with a Civic Event
shall be required to purchase admission tickets for such Civic
Event.
(h) The County or the ECSC, as the case
may be, shall promptly repair or cause to be repaired any damage
to any component of the Stadium Complex arising out of any Civic
Event which it sponsors.
(i) Neither the County, the ECSC nor any
Person designated by the County or the ECSC with respect to a
Civic Event shall have the right to use any of the Reserved Areas
during Civic Events.
(j) At the request of the County or the
ECSC, as the case may be, the Bills shall operate the Stadium
Complex concessions and the Parking Areas during or in connection
with a Civic Event at a level deemed appropriate by the Bills, in
their reasonable discretion, in light of the nature of the Civic
Event and the number of Stadium Patrons expected to attend the
Civic Event. All revenue derived from such operations shall
belong to the Bills.
2.4 Suitability of the Stadium
Complex. The Bills acknowledge that neither the County, the
ECSC nor their respective agents or employees have made any
representations or warranties as to the suitability or fitness of
the Stadium Complex for the operations of the Team or for any
other purpose, nor has the County, the ECSC or their respective
agents or employees agreed to undertake any alterations or
construct any improvements to the Stadium Complex except as
expressly provided in the Master Lease, this Stadium Lease and in
the Construction Coordinating Agreement.
ARTICLE 3 RENT
3.1 Rent. On or before
March 31st of each Lease Year, the Bills shall pay to the
ECSC, as rent for the Stadium Complex, fifty percent (50%) of the
amount by which Net Ticket Revenue exceeds NFL Average Net Ticket
Revenue for the NFL Season concluded on or about
February 1st of such Lease Year. Such rent shall be paid to
the ECSC without notice or demand and without abatement,
deduction or set-off in lawful money of the United States of
America at the ECSC's Address and shall be accompanied by a
certification, in form and content satisfactory to the ECSC, from
an independent nationally recognized certified public accounting
firm reasonably acceptable to the ECSC, setting forth the
calculations used by the Bills in determining such rental
payment.
3.2 NFL Net Ticket Revenue
Calculation. On or before March 31st of each Lease Year,
the NFL shall furnish the ECSC with the NFL Average Net Ticket
Revenue for the preceding NFL Season, together with appropriate
backup information so as to permit the ECSC to verify the NFL's
computations. In the event the NFL fails or refuses to furnish
the information necessary to calculate and verify the NFL Average
Net Ticket Revenue for the preceding NFL Season by such date,
rent for the then current Lease Year shall be computed by using
in lieu thereof the average of the NFL Average Net Ticket Revenue
for the four most recently available NFL Seasons. Any rent
determined thereby to be due from the Bills to the ECSC shall be
promptly remitted to the ECSC in accordance with Section 3.1.
Promptly following the furnishing by the NFL of the NFL Average
Net Ticket Revenue figures for such NFL Season, rent shall be
recomputed and appropriate adjustments between the Bills and the
ECSC shall be made.
3.3 Audit. The ECSC shall be
entitled from time to time to audit and verify the Books and
Records to assure that Net Ticket Revenue and the corresponding
rent calculations are in accordance with this Article 3.
In the event that any such audit or verification reveals that the
rent paid by the Bills for any Lease Year is understated, the
Bills will immediately pay to the ECSC such unpaid rent, together
with interest at the Default Interest Rate, from the date on
which such rent should have been paid. In the event such audit or
verification reveals an underpayment of rent of three percent
(3%) or more, in addition to such payment, the Bills will
immediately reimburse the ECSC for all costs reasonably incurred
for such audit and verification.
3.4 Late Payment. In the event
that any payment of rent or additional rent due hereunder is not
paid by the fifth (5th) day after which it is due, a late charge
of five percent (5%) of the overdue amount may be charged by the
ECSC for each month or part thereof that the same remains
overdue. Any such "late charges" shall be deemed
additional rent hereunder.
ARTICLE 4. ADDITIONAL RIGHTS OF THE BILLS WITH RESPECT TO THE STADIUM COMPLEX
4.1 General Right to Receive Revenue
Generated at the Stadium Complex. Subject to the terms and
conditions of this Stadium Lease, and, in particular Article 2
and Article 4, during the Term, the Bills shall have the
exclusive right to contract for, collect, receive and retain all
income and revenues of whatever kind or nature realized by, from
or in connection with the Stadium Complex, including, without
limitation, all revenues, royalties, license fees, concession
fees and income and receipts arising from (a) the sale or
distribution of admission tickets to Games and Bills' Events
(including admission tickets to Club Level Seats, Luxury Suites
and general admission seats); (b) the naming of, or the
sale, lease or license of the right to name the Stadium Complex
or any portion thereof; (c) the sale, lease or license of
the Advertising Rights, including Signage; (d) the sale,
lease or license of the Broadcast Rights; (e) the sale of
food and beverages at the Stadium Complex; (f) the operation
of the Parking Areas; (g) the sale of merchandise, programs
and other goods and wares of any nature whatsoever at the Stadium
Complex; and (h) the use of Luxury Suites and Club Level
Seats. Nothing contained herein or elsewhere in the Stadium
Agreements shall be construed as a limitation or curtailment of
the general regulatory or police powers of the County or any
other Governmental Authority. It is further acknowledged and
agreed that the rights of the Bills pursuant to this Article 4
(including, without limitation, any contract entered by the Bills
pursuant to this Article 4): (a) shall expire at the
end of the Term (regardless of whether the Term ends by reason of
the attainment of the Stadium Lease Expiration Date or the
earlier termination or cancellation thereof); and (b) shall be
subject to Applicable Law (including any obligation imposed on
the Bills under Applicable Law to collect and remit all required
sales and use taxes).
4.2 Naming of Stadium Complex.
(a) The Bills shall have the exclusive right to name, or contract
from time to time with any Person or Persons on such terms as the
Bills may determine with respect to the naming of the Stadium
Complex or any portion thereof; provided that (i) the term
during which any such name shall apply shall expire no later than
the end of the Term (whether due to the attainment of the Stadium
Lease Expiration Date or any earlier termination or cancellation
thereof) and (ii) given the substantial interest of the County
and the ECSC in the Stadium Complex and the public character
thereof, the Bills shall not permit any name to be given to the
Stadium Complex or any portion thereof except in accordance with
this Section 4.2.
(b) In the event the Bills name the
Stadium Complex or any portion thereof themselves, any name
chosen by the Bills (i) shall be consistent with the NFL's
policy with respect to the promotion and image of professional
football (taking into account the fact that the game has
substantial appeal to youth) and (ii) shall not unreasonably
cause embarrassment to the County or the ECSC (such as names
containing slang, barbarisms or profanity; names that could be
construed to encourage the use of alcohol by minors or the use of
tobacco by persons of any age; or names that relate to illicit
drugs or any sexually oriented business or enterprise).
(c) In the event the Bills contract with
any Person or Persons with respect to the naming of the Stadium
Complex or any portion thereof, such name shall be subject to the
prior approval of the County and the ECSC, which approval shall
not be unreasonably withheld. Each of the County and the ECSC
shall be deemed to have given its approval to any name requested
by the Bills unless, within forty-five (45) days following such
party's receipt of the Bills' written request for such approval,
such party notifies the Bills of its disapproval in writing.
(d) The Bills agree to indemnify, defend
and hold harmless the County and the ECSC from any Losses arising
out of the exercise by the Bills of their rights pursuant to this
Section 4.2; provided, however, that the foregoing
indemnification shall not be construed so as to include any
revenue or income which the County or the ECSC might have
realized upon the sale or other conveyance of the naming rights
to the Stadium Complex or any portion thereof.
(e) Following the selection, and, if
necessary, approval by the County and the ECSC of a name for the
Stadium Complex, the County shall use commercially reasonable
efforts: (i) to cause all existing County road signs which
reference the Stadium Complex to identify the Stadium Complex by
such name within thirty (30) days of its receipt of written
notification of the selection of such name, and (b) to cause
all County brochures and literature published thereafter which
reference the Stadium Complex to identify the Stadium Complex by
such name. Notwithstanding the foregoing, (i) the County
shall not have any obligation pursuant to the preceding sentence
other than with respect to the initial name given to the Stadium
Complex pursuant to this Section 4.2, and
(ii) the preceding sentence shall not be construed so as to
impose any obligation on the County with respect to any signage,
brochures, literature or other media promulgated by any other
Governmental Authority.
4.3 Advertising Rights. Subject
to Applicable Law, including, but not limited to, County Local
Law No. 2-1994, a copy of which is attached hereto as Exhibit J,
the Bills shall have the exclusive right to control and contract
with respect to the Advertising Rights; provided that
(a) the duration of any contract with respect to the
Advertising Rights shall expire no later than the end of the Term
(whether due to the attainment of the Stadium Lease Expiration
Date or any earlier termination or cancellation thereof) and
(b) given the County's substantial interest in the Stadium
Complex and the public character thereof, the Bills shall not
erect or permit to be erected any Signage which is intended to
remain in place for any period longer than seven (7) days without
the County's prior written approval as to the location, size and
content thereof, which approval shall not be unreasonably
withheld, conditioned or delayed. The County shall be deemed to
have given its approval to any Signage requested by the Bills
unless, within fifteen (15) business days following receipt of
the Bills' written request for such approval, the County notifies
the Bills of its disapproval. The Bills agree to indemnify,
defend and hold harmless the County and the ECSC from any Losses
arising out of the exercise by the Bills of their rights pursuant
to this Section 4.3; provided, however, that the foregoing
indemnification shall not be construed so as to include any
revenue or income which the County or the ECSC might have
realized upon the sale or other conveyance of the Advertising
Rights.
4.4 Broadcast Rights. The Bills
shall have the exclusive right to control, conduct, lease,
license, grant concessions with respect to, sell, benefit,
control and enter into agreements with respect to the Broadcast
Rights; provided that the duration of any contract with respect
to the Broadcast Rights shall expire no later than the end of the
Term (whether due to the attainment of the Stadium Lease
Expiration Date or any earlier termination or cancellation
thereof).
4.5 Concessions.
(a) The Bills shall have the exclusive
right to sell all food and beverages within the Stadium Complex,
which shall include the right to contract with any third party or
parties to operate the food and beverage concessions at the
Stadium Complex; provided that the duration of any contract with
respect to the food and beverage concessions shall expire no
later than the end of the Term (whether due to the attainment of
the Stadium Lease Expiration Date or any earlier termination or
cancellation thereof).
(b) Any concessionaire with whom the
Bills shall contract shall be entitled to bring a reasonably
sufficient number of legally-qualified workers into the Stadium,
free of charge, in order to operate its concession. Any
concessionaire's workers shall at all times be neatly, modestly
and cleanly dressed. The concessionaire's workers shall not
unreasonably disturb or offend Stadium Patrons or disturb or
interfere with any Stadium Events. The Bills shall comply with
all Applicable Laws with regard to the grant of the concession
rights described herein to any third party and with regard to the
operation of the food and beverage concessions at the Stadium
Complex. The Bills shall determine the items of food or beverage
to be offered, the prices to be charged for such items and the
concessionaires to provide such service. Subject to terms and
conditions of Article 15, the Bills shall have the
right to determine the location of concession stands for the sale
of food and beverage concessions and staging areas for the
storage and preparation of food and beverages prior to sale,
within the Stadium Complex, in its reasonable discretion, subject
to considerations for public health, safety and access. The
rights granted to the Bills with regard to concessions pursuant
to this Stadium Lease shall include the right to determine, in
the Bills' reasonable discretion, how many concession areas will
be open during any Stadium Events and what items of food and
beverage shall be served. For the purposes of this Stadium Lease,
the right to sell or offer for sale beverages and all other
rights granted to the Bills with regard thereto shall
specifically include the right to sell, offer for sale and
control the sale of alcoholic beverages, subject to Applicable
Law.
(c) Each food and beverage concession
contract shall: (i) include a covenant in form of
paragraph 1 of the Affirmative Action Plan evidencing the
agreement of the concessionaire to refrain from discrimination
with respect to its employees at the Stadium Complex;
(ii) provide that concessionaire shall maintain the
insurance coverages set forth in Exhibit K attached
hereto; (iii) provide that the concessionaire shall
indemnify, defend and hold harmless the County, the ECSC and
their respective Affiliates from and against any and all
liability arising out of such concessionaire's operations;
(iv) provide that the concessionaire shall comply with
Applicable Law; and (v) be subject to the County's review
and approval of the non-financial covenants thereof, which
approval shall not be unreasonably withheld, conditioned or
delayed. One or more representatives of the Bills (who may be
employees of any concessionaire) shall be made available to the
County and the ECSC as part of the operation of concessions at
Stadium Events in order to handle any problems which may arise
with regard thereto.
(d) Throughout the Term, the Bills shall
use commercially reasonably efforts to cause all food and
beverage concessionaires at the Stadium Complex to fully perform
and comply with the terms and conditions of the contract between
the Bills and such concessionaire, and, upon such
concessionaire's breach thereof, enforce through appropriate and
lawful means, each such contract in accordance with the terms and
conditions thereof.
4.6 Parking. The Bills shall have
the exclusive right to operate, manage and control the Parking
Areas, and shall determine the fees to be charged for parking at
the Stadium Complex; provided, however, that the duration of any
contract with respect to the management or operation of the
Parking Areas shall expire no later than the end of the Term
(whether due to the attainment of the Stadium Lease Expiration
Date or any earlier termination or cancellation thereof).
4.7 Merchandising. The Bills
shall have the exclusive right to sell, lease or contract for the
sale or lease of programs, yearbooks, novelties, pendants, hats,
clothing, sports equipment, cameras, film, binoculars, headsets
or any other items, goods or equipment which the Bills (in their
sole discretion) may desire to offer for sale or lease at the
Stadium and elsewhere within the Stadium Complex; provided that
the duration of any contract with respect to the sale of
merchandise at the Stadium Complex shall expire no later than the
end of the Term (whether due to the attainment of the Stadium
Lease Expiration Date or any earlier termination or cancellation
thereof). The Bills shall also have the exclusive right to set up
carts, kiosks and other similar temporary structures for the sale
of such items anywhere on the Stadium Complex at locations
selected by the Bills in their reasonable discretion, taking into
consideration public safety and access. Neither the County nor
the ECSC shall have any rights of approval with regard to the
items of merchandise offered for sale or lease at the Stadium or
elsewhere within the Stadium Complex, the prices to be charged
for such items of merchandise or the concessionaire or
concessionaires to provide such merchandise; provided however,
that the Bills shall not sell or offer to sell at the Stadium
Complex products containing tobacco or any other products which
are now or hereafter may be prohibited for sale at the Stadium
Complex by Applicable Law.
4.8 Luxury Suites. The Bills
shall have the exclusive right to license any or all of the
Luxury Suites during the Term, and the Bills shall retain all
License Fees and other revenues derived therefrom; provided,
however, that the duration of any license with respect to any
Luxury Suite shall expire no later than the end of the Term
(whether due to the attainment of the Stadium Lease Expiration
Date or any termination or cancellation thereof). Without the
prior written consent of the County and ECSC, which consent shall
not be unreasonably withheld, conditioned or delayed, the Bills
shall not utilize any form of agreement to effect such licensing
other than forms substantially similar to those attached hereto
as Exhibit L. Licensees of Luxury Suites shall have
the right to purchase tickets for admission to their Luxury Suite
for Civic Events in accordance with Section 2.3(g).
4.9 Club Level Seats. The Bills
shall have the exclusive right to license any or all of the Club
Level Seats during the Term, and the Bills shall retain all
License Fees and other revenues derived therefrom; provided,
however, that the duration of any license with respect to any
Club Level Seat shall expire no later than the end of the Term
(whether due to the attainment of the Stadium Lease Expiration
Date or any earlier termination or cancellation thereof). Without
the prior written consent of the County and ECSC, which consent
shall not be unreasonably withheld, conditioned or delayed, the
Bills shall not utilize any form of agreement to effect such
licensing other than forms substantially similar to those
attached hereto as Exhibit L. Licensees of Club Level
Seats shall have the right to purchase tickets to utilize their
Club Level Seats for Civic Events in accordance with Section 2.3(g).
4.10 Scoreboards. The Bills shall
have the exclusive right to use and control the Scoreboards at
all Stadium Events during the Term, provided that the County and
the ECSC shall have access to the Scoreboards in the event of an
emergency. Upon request of the County or the ECSC, as the case
may be, the Bills shall make the Scoreboards (and any personnel
necessary to operate the Scoreboards) available for all Civic
Events.
4.11 Jumbotron. The Bills shall
have the exclusive right to use and control the Jumbotron, as
well as the control room or rooms used for the operation of the
Jumbotron, at all Stadium Events during the Term, provided that
the County and the ECSC shall have access to the Jumbotron in the
event of an emergency. Upon request of the County or the ECSC, as
the case may be, the Bills shall make the Jumbotron (and any
personnel necessary to operate the Jumbotron) available for all
Civic Events.
ARTICLE 5 USE
5.1 The Bills' Use of the Stadium
Complex. Subject to the terms and conditions of this Stadium
Lease, during the Term, the Bills shall have the right to use the
Stadium Complex for any lawful purpose which (a) is not
generally recognized as being contrary to public morals, and
(b) does not change the primary purpose of the Stadium
Complex from a venue for professional football contests and
musical concerts and festivals, consistent with the uses to which
the Stadium has been put during the term of the Original Lease.
The County and the ECSC acknowledge that the uses to which the
Stadium has been put during the term of the Original Lease (i.e.,
professional football contests and musical concerts and
festivals) have not been, and shall not hereafter be deemed to be
generally recognized as being contrary to public morals.
5.2 Compliance with Law. Subject
to respective obligations of the County and the Bills to perform
Capital Improvements required by reason of Applicable Law as
hereafter set forth in this Section 5.2, at all times
during the Term, the Bills shall, at their sole cost and expense,
comply with: (i) all Applicable Laws; (ii) all
requirements of any board of fire underwriters or other similar
body; and (iii) any direction or occupancy certificate
issued by any Governmental Authority. Any Capital Improvement to
or within the Stadium Complex, or any part thereof, which may be
necessary or required by reason of any Applicable Law (including,
without limitation, the Americans With Disabilities Act) and
which arises out of or relates to any Bills' Improvement, shall
be promptly made by and at the cost and expense of the Bills,
subject, however, to the terms and conditions of this Stadium
Lease, including without limitation, Article 15
hereof. Pursuant to Section 7.1 of the Master Lease, any
other Capital Improvement to or within the Stadium Complex or any
part thereof, which may be necessary or required by reason of any
Applicable Law (including, without limitation, the Americans With
Disabilities Act), shall be promptly made by and at the cost and
expense of the County, in accordance with plans and
specifications approved by the Bills, such approval not to be
unreasonably withheld, conditioned or delayed.
5.3 Covenant Prohibiting Professional
Baseball. Notwithstanding the permitted uses set forth in Section 5.1,
the Bills shall not keep or maintain a professional baseball
franchise at the Stadium Complex without the prior written
consent of the County and the ECSC.
5.4 Smoking Ban. Throughout the
Term, smoking shall be prohibited in the Buildings, except in
accordance with Applicable Law. At all times during the Term, the
Bills shall use their best efforts to cause all Stadium Patrons
to comply with County Local Law No. 5-1996, a copy of which
is attached hereto as Exhibit M. The Bills shall be
deemed to have utilized their best efforts to cause all Stadium
Patrons to comply with such law if the Bills: (a) post
placards throughout the Buildings regarding the prohibition
against smoking; (b) refuse entry to the Stadium to any
Stadium Patron who is smoking; (c) make at least two
(2) announcements over the Stadium's public address system
during each Game and Bills Event regarding said prohibition; and
(d) notify Stadium Patrons who are seen violating said law
that they are doing so.
ARTICLE 6 FRANCHISE MAINTENANCE
6.1 Playing of Games. The NFL
covenants and agrees that at all times during the Term, at least
fifty percent (50%) of the Team's Regular Season Games will be
designated as "home" games. Subject only to the
exceptions described in Section 6.2 below, the Bills
covenant and agree that, during the Term (as the same may be
terminated or cancelled prior to the Stadium Lease Expiration
Date in accordance with the terms and conditions hereof), all
Games shall be played at the Stadium, unless each of the County
and ECSC shall have given prior written consent to the playing of
specified Games at a different location or locations, which
consent shall be within the sole and absolute discretion of each
of the County and ECSC.
6.2 Exceptions. Notwithstanding
the provisions of Section 6.1 above, the Bills shall have
the right to play any Game at a facility other than the Stadium
if, as a proximate result of an event of Force Majeure, the
Stadium cannot practically, safely and economically be used by
the Bills for any Game, provided that the Bills shall promptly
furnish notice to each of the County and ECSC in the event of the
occurrence of any such event, which notice shall identify the
event, the resulting condition and number of days and Games
expected to be played at such other facility.
6.3 Maintenance of the Team and the
Franchise.
(a) During the Term, the Bills shall:
(i) keep and maintain the Team as a member in good standing of
the NFL; (ii) keep and maintain the Franchise in good
standing with the NFL; (iii) subject to the fulfillment by
the County and the ECSC of their respective obligations to repair
and maintain the Stadium Complex pursuant to the Stadium
Agreements (and any applicable notice and cure periods provided
for therein), keep and maintain the Stadium as the facility
designated to and by the NFL as the home facility for the Team;
and (iv) continuously operate the Team at the Stadium in
accordance with NFL Rules and Regulations. Subject to the
provisions of Section 6.2 above and the terms and
conditions of this Section 6.3, during the Term, without
the prior written consent of the County and the ECSC, which
consent shall be within the sole and absolute discretion of each
of the County and the ECSC, the Bills shall not: (i) apply
to the NFL for approval to allow the Team to play any Games
during the Term anywhere other than the Stadium;
(ii) relocate, transfer or otherwise move the Team to a
location other than the Stadium; (iii) sell, assign or
otherwise transfer the Team to any Person who discloses to the
Bills an intention to relocate, transfer or otherwise move the
Team during the Term to a location other than the Stadium; or
(iv) enter into any contract or agreement to sell, assign or
otherwise transfer the Team to any Person who discloses to the
Bills an intention to relocate, transfer or otherwise move the
Team during the Term to a location other than the Stadium.
(b) Notwithstanding the foregoing, it is
acknowledged that in the event of a violation of any of the
affirmative covenants set forth in clauses (i) and (ii) of the
first sentence of subparagraph (a) above which occurs at any time
other than during a NFL Season, such violation shall not
constitute a Sublessee Default unless and until: (i) the
ECSC or the County shall have given the Bills written notice
thereof; and (ii) such violation continues for a period of
thirty (30) days thereafter, or if such violation cannot
reasonably be cured within such thirty (30) day period, if the
Bills fail to diligently commence to cure such violation within
thirty (30) days after such written notice, and to diligently
complete such cure thereafter.
6.4 Transfer of Franchise.
(a) During the Term, the Bills may not
sell, assign or otherwise transfer the Franchise or any of their
interest in the Franchise to any Person other than a Permitted
Assignee.
(b) At least ten (10) days prior to the
consummation of any sale, assignment or other transfer of the
Franchise or of any interest of the Bills in the Franchise by the
Bills to a Permitted Assignee, the Bills shall deliver to each of
the County and ECSC for written approval, such approval not to be
unreasonably withheld, conditioned or delayed, a copy of the
instrument by which such proposed Permitted Assignee agrees to be
bound by the terms of the Stadium Agreements and, in particular,
the Franchise Maintenance Covenants and to assume and perform all
of the Bills' obligations and covenants contained herein.
6.5 Specific Enforcement; Liquidated
Damages.
(a) The Parties acknowledge that:
(i) the Team, as property, is extraordinary and unique and
that under the organization of professional football by and
through the NFL, neither the County nor the ECSC may be able to
replace the Team; and (ii) that the determination of damages
caused by a breach of the Franchise Maintenance Covenants and
suffered by the State, the County, the ECSC and the Western New
York community would be difficult, if not impossible, to
ascertain. Therefore, the Parties acknowledge and agree that
there exists no adequate and complete remedy at law to enforce
the Franchise Maintenance Covenants, and that equitable relief by
way of a decree of specific performance or an injunction (such as
a prohibitory injunction barring the Bills from relocating or
playing the Games in a facility other than the Stadium or a
mandatory injunction requiring the Bills to play the Games at the
Stadium) is the only appropriate remedy for the enforcement of
the Franchise Maintenance Covenants notwithstanding the
provisions for liquidated damages provided elsewhere in this Section
6.5. In amplification and not in limitation of the foregoing,
the County and the ECSC acknowledge and agree that, in the event
the Bills breach or threaten to breach any of the Franchise
Maintenance Covenants, the County and/or the ECSC, as the case
may be, shall seek equitable relief before attempting to avail
itself or themselves of the liquidated damages provisions set
forth in this Section 6.5.
(b) The Bills acknowledge and agree
that, if upon the breach of any of the Franchise Maintenance
Covenants, equitable relief fashioned to require the Bills to
play Games in the Stadium is not granted by a court of competent
jurisdiction for any reason, the payment of liquidated damages is
the next most appropriate remedy. Therefore, in the event of a
breach by the Bills of any of the Franchise Maintenance Covenants
and the failure of any such court to grant the equitable relief
described in subparagraph (a) above, the Bills shall pay
liquidated damages to the County and the ECSC, in the aggregate,
as follows:
(i) In the event such breach
occurs prior to the commencement of the seventh (7th)
Lease Year, the amount of liquidated damages shall be the
Unamortized Initial ECSC Investment as of the date of the
breach of the relevant Franchise Maintenance Covenant.
(ii) In the event such breach
occurs on or after the commencement of the seventh (7th)
Lease Year, the amount of liquidated damages shall be
one-hundred and fifty percent (150%) of the Termination
Fee (less the Recoupment Amount) that would be otherwise
due and payable as of the date of such breach if the
Bills had validly exercised their option to terminate
this Stadium Lease pursuant to Section 7.2, which
liquidated damage amount shall be in lieu of the
Termination Fee that would have been otherwise payable
had the Bills validly exercised their option pursuant to Section 7.2.
(c) In determining the amount of
liquidated damages provided for in sub-paragraph (b) above, it is
acknowledged and agreed that the Parties have exercised great
care to make a reasonable forecast of direct and consequential
damages allowable by law that may arise from the breach of any of
the Franchise Maintenance Covenants, taking into due
consideration: (i) the loss of taxes attributable to Team
operations; (ii) the extraordinary involvement, covenants and
expense of the public in securing the Team's commitment to play
the Games at the Stadium for the Term; (iii) the consequent
reduction in value of the Stadium Complex arising from the
absence of the Team; (iv) the substantial economic benefit
conferred upon the Team through the Stadium Lease intended to
assure that the Team will play all of its Games in the Stadium
for the Term; (v) the detrimental effects of a breach on the
Western New York community; and (vi) the loss of revenues to the
Western New York community. Upon the breach of any of the
Franchise Maintenance Covenants, and if injunctive relief or
specific performance as provided in this Section 6.5
is not granted to either the County or the ECSC, liquidated
damages shall be paid by the Bills in immediately available funds
in a lump sum not later than ninety (90) days from the date of
the breach of any such covenant.
(d) If, upon the breach of any of the
Franchise Maintenance Covenants, equitable relief fashioned to
require the Bills to play Games in the Stadium is not granted by
a court of competent jurisdiction for any reason, the Bills, for
themselves, their successors, Permitted Assignees and Affiliates,
hereby waive any right, arising hereunder, at law, in equity or
otherwise, to object to or otherwise challenge the validity,
appropriateness or legitimacy of liquidated damages as the remedy
for such breach.
6.6 All Remedies. If, upon a
breach or threatened breach of any of the Franchise Maintenance
Covenants by the Bills, the equitable remedies and liquidated
damages provided for in Section 6.5 are unavailable
for any reason, each of the County and the ECSC shall be entitled
to pursue all other legal and equitable remedies against the
Bills (including, but not limited to, those remedies which are
available to the County and the ECSC by reason of a Sublessee
Default), whether or not such remedies are specifically set forth
in this Article 6; provided, however, that any damages or
money judgment obtained in any such legal or equitable
proceedings shall not exceed the amount of liquidated damages
that the County and the ECSC would have been entitled to receive
pursuant to Section 6.5(b) but for such
unavailability. All such remedies are cumulative and may be
exercised concurrently, successively, or in any order.
6.7 Termination of Covenants. The
Franchise Maintenance Covenants shall terminate upon the
expiration or earlier rightful termination or cancellation of the
Term; provided, however, that no such termination or cancellation
shall relieve the Bills of any obligation for liquidated damages
arising or accruing pursuant to this Article 6 prior to
the date of such termination or cancellation.
6.8 NFL Rules and Regulations.
The NFL represents and warrants to each of the County and the
ECSC that the excerpts of the NFL Rules and Regulations attached
hereto as Exhibit C include all portions thereof relevant
to the transactions contemplated by the Stadium Agreements, and
are true, correct and complete as of the date hereof. The NFL
hereby undertakes to deliver to each of the County and the ECSC,
within ten (10) days after the NFL's receipt of a written request
therefor, true, correct and complete copies of all subsequent
amendments to those portions of the NFL Rules and Regulations
that pertain to the transactions contemplated by the Stadium
Agreements.
ARTICLE 7. CANCELLATION OF LEASE;
LEASE BUYOUT
7.1 Automatic Cancellation of Stadium
Lease.
(a) If on or before December 1,
1998, Satisfaction is achieved with respect to the Marketing
Campaign or the Bills deliver a written waiver of the necessity
therefor, this Stadium Lease shall remain in full force and
effect. If, however, Satisfaction is not achieved or otherwise
waived in writing on or before December 1, 1998, this
Stadium Lease shall automatically terminate, and, except for the
terms and conditions hereof which specifically survive such
termination, shall become void and of no further force and
effect. The effectiveness of such automatic termination shall be
conditioned upon the payment by the Bills of the sum set forth in
Section 11.2.
(b) While not a condition to either the
automatic continuation or termination of this Stadium Lease
pursuant to subparagraph (a) above, on or prior to
December 1, 1998, but not later than 12:00 noon on
December 1, 1998, the Bills shall deliver to each of the
ECSC and the County, notice in the form of Exhibit N
attached hereto, evidencing either: (i) the achievement of
Satisfaction with respect to the Marketing Campaign;
(ii) the waiver by the Bills of necessity of achieving
Satisfaction with respect to the Marketing Campaign; or
(iii) the failure to achieve Satisfaction with respect to
the Marketing Campaign.
(c) For the purposes of this Section 7.1,
the notice provided for in subparagraph (a) above shall be
deemed "delivered" if, on or before 12:00 noon on
December 1, 1998, the Bills receive confirmation that notice
was successfully transmitted via facsimile to both the
ECSC or the County, or the Bills deliver such notices to Federal
Express, UPS or other similar private courier for overnight
shipment to the ECSC and the County.
7.2 Lease Buyout Option. The
Bills shall have the right to terminate this Stadium
Lease effective at 11:59 p.m.,
Buffalo, New York time, on the last day of any of the sixth (6th)
through fourteenth (14th) Lease Years (i.e., July 30th of
any of the Lease Years ending in 2004 through 2012). Such right
of cancellation shall be exercised by the Bills' delivery to the
County and the ECSC of written notice no later than 12:00 noon on
February 28th of the Lease Year at the end of which the
Bills seek to end the Term. The effectiveness of such notice
shall be conditioned upon the payment, on or before the
Termination Date, by the Bills to the ECSC of the Termination Fee
for such Lease Year less that portion of the Recoupment Amount as
may have been agreed upon by the Bills and the ECSC on or before
the Termination Date. If it is later determined (either by the
agreement of the Bills and the ECSC or by a decision of the
arbitrators pursuant to Article 23 of this Stadium
Lease) that the Recoupment Amount is greater than the amount
actually deducted from the Termination Fee as provided in the
immediately preceding sentence, the ECSC shall promptly refund
said difference to the Bills. If (a) as of the Termination
Date, (i) Transfer of Ownership has occurred, or
(ii) the Bills have entered into a contract or other
agreement with any Person which contemplates Transfer of
Ownership, or (b) prior to the Termination Date, the Bills
have had discussions with any Person in contemplation of Transfer
of Ownership, and within one (1) year of the Termination Date,
(i) the Bills have entered into a contract or agreement with
such Person which contemplates Transfer of Ownership or
(ii) Transfer of Ownership to such Person has occurred, the
Termination Fee shall be one-hundred and fifty percent (150%) of
the amount that is otherwise due and payable pursuant to this Section 7.2.
The Bills obligation to pay the Termination Fee shall survive the
termination of this Stadium Lease.
7.3 Automatic Termination. In the
event the Construction Coordinating Agreement is terminated or
cancelled pursuant to the terms and conditions thereof, this
Stadium Lease and the Term shall automatically terminate as of
the end of the Lease Year in which such termination or
cancellation occurs and no party shall have any further rights or
obligations hereunder.
ARTICLE 8 PLAYERS' STRIKE
8.1 Effect of Players' Strike. If
as a result of a Players' Strike occurring during the first six
(6) Lease Years, any Home Game is not played at the Stadium, the
Game Day Expense Portion of any Operating/Game Day Expense
Reimbursement and any Working Capital Assistance previously paid
by the ECSC to the Bills for the Lease Year in which such
unplayed Home Game falls shall be promptly repaid to ECSC
pro-rata as follows: (a) for the Game Day Expense Portion, the
amount of such reimbursement for each unplayed Home Game shall be
calculated based upon a fraction, the numerator of which shall be
the total Game Day Expense Portion for such Lease Year, and the
denominator of which shall be the number of scheduled Home Games
for such Lease Year, and (b) for the Working Capital Assistance,
the amount of such reimbursement shall be calculated based upon a
fraction, the numerator of which $3,000,000 and the denominator
of which shall be the number of schedule Home Games for such
Lease Year.
ARTICLE 9 OPERATION OF THE STADIUM
COMPLEX
9.1 General Operation of the Stadium
Complex. Subject to the terms and conditions of this Stadium
Lease, including, but not limited to, Section 10.1 of
this Stadium Lease, the Bills shall have the exclusive right,
power, authority and obligation to direct all aspects of the
operation, repair, maintenance, management and control of the
Stadium Complex at all times during the Term acting on their own
behalf and not as an agent of either the County or the ECSC. The
Bills shall have such discretion in the operation, repair,
maintenance, management and control of the Stadium Complex as may
be needed to perform efficiently their responsibilities under
this Stadium Lease. Without limiting the generality of the
foregoing and without limiting the County's, the ECSC's and the
Bills' rights and obligations set forth elsewhere in this Stadium
Lease, during the Term, the Bills shall perform the following:
(a) Operate, repair and maintain the
Stadium Complex or cause the Stadium Complex to be operated,
repaired and maintained in good condition and repair and
otherwise in accordance with Applicable Law and NFL Rules and
Regulations, normal wear and tear and the Structural Repair
obligations of the County pursuant to Section 10.1 of
this Stadium Lease and Section 7.1 of the Master Lease
excepted;
(b) Establish and implement an annual
preventative maintenance program for the Stadium Complex
reasonably satisfactory to the ECSC and the County which shall
have as its principal objective minimization of Structural
Repairs and Operating Expenses;
(c) Regulate the use of the Stadium
Complex consistent with the provisions of Article 5 and,
in furtherance thereof, submit to the County and the ECSC prior
to the beginning of each fiscal year of the County an annual
operating plan for such fiscal year indicating the type and
nature of events that are then contemplated for the Stadium
Complex during such fiscal year (based on information then
available);
(d) Employ, engage, promote, discharge
and otherwise supervise and control the work of all employees,
and contract with all independent contractors, deemed necessary
or advisable by the Bills to discharge their responsibilities
with respect to the operation, repair, maintenance, management
and control of the Stadium Complex under this Stadium Lease;
(e) Procure and maintain throughout the
Term all Bills' Insurance Policies;
(f) Pay or cause to be paid all
Assessments (subject, however, to the terms and conditions of Article 20);
(g) Operate, repair, maintain, manage
and control the Access Roads;
(h) Contract for and manage all security
personnel and systems for the Stadium Complex and otherwise
control all aspects of access (including restricting access) to
the Stadium Complex;
(i) Provide and enter into contracts for
the furnishing to the Stadium Complex of (i) all utilities,
including electricity, gas, sewage, water and telephone,
(ii) cleaning and janitorial services and adequate dumpsters
and trash removal, (iii) elevator and boiler maintenance
service, air conditioning maintenance service and other equipment
maintenance service, (iv) laundry service, and (v) any and all
services deemed advisable by the Bills in conjunction with the
operation, repair, maintenance, management and control of the
Stadium Complex;
(j) Purchase all supplies and materials
regularly used and consumed in the operation, repair,
maintenance, management and control of the Stadium Complex;
(k) Obtain and maintain licenses and
permits in the operation, repair, maintenance, management and
control of the Stadium Complex in accordance with Applicable Law
(provided, however, that the Bills shall not be required to
obtain or maintain any licenses or permits that may be required
in connection with the management or operation of any Civic
Events which are not otherwise required in conjunction with the
Bills' general management and operation of the Stadium Complex);
(l) Impose and enforce such rules and
regulations governing use of the Stadium Complex as it may
establish from time to time (acting reasonably and subject to
prior consultation with the County and the ECSC with respect
thereto) to assist in ensuring the use of the Stadium Complex by
all Persons consistent with the terms of this Stadium Lease (with
a copy of such rules and regulations and any amendments thereto
to be furnished to the County and the ECSC promptly after the
promulgation thereof); and
(m) Maintain the Books and Records in
accordance with GAAP.
9.2 Other Stadium Complex Operations.
Subject to the terms and conditions of this Stadium Lease, and in
particular the limitations of Article 4 of this
Stadium Lease, the Bills shall have the exclusive right, power,
authority and obligation to direct all aspects of the operation,
management and control of the income or revenue producing
activity at the Stadium Complex at all times during the Term
acting on their own behalf and not as an agent of either the
County or the ECSC. The Bills shall have such discretion in the
operation, management and control of such activities as may be
needed to perform efficiently its responsibilities under this
Stadium Lease. Without limiting the generality of the foregoing
and without limiting the County's, the ECSC's and the Bills'
rights and obligations set forth elsewhere in this Stadium Lease,
during the Term, the Bills shall, at their sole cost and expense,
perform the following:
(a) Operate, repair and maintain the
Bills' Improvements and the Bills' equipment, personal property
and trade fixtures situated in or on the Stadium Complex, or
cause such property to be operated, repaired and maintained in
good condition and repair and otherwise in accordance with
Applicable Law and NFL Rules and Regulations, normal wear and
tear excepted;
(b) Select all concessionaires and
vendors (other than Unaffiliated Vendors) selling food,
beverages, novelties, souvenirs, programs, merchandise and wares
of any nature whatsoever in any part of the Stadium Complex;
(c) Operate or cause to be operated all
restaurants and other dining facilities located in the Stadium
Complex during all Stadium Events;
(d) Establish procedures, rules and
policies regarding employee relations, and all aspects of
advertising, publicity and promotion at the Stadium Complex; and
(e) Directly or through its Affiliates,
sell, market and establish the price of all admission tickets for
all Games and Bills Events.
9.3 Responsibility for Operating and
Game Day Expenses. Subject to the reimbursement provisions
provided for in Section 9.4 hereof, the Bills shall bear
all Operating Expenses and Game Day Expenses.
9.4 Reimbursement of Operating
Expenses and Game Day Expenses.
(a) Provided no Material Sublessee
Default has occurred and is continuing, during the Term, the ECSC
shall reimburse the Bills for Operating Expenses and Game Day
Expenses paid by the Bills in any given Lease Year up to the
Operating/Game Day Reimbursement Cap for such Lease Year. Any
portion of the Operating/Game Day Expense Reimbursement due Bills
hereunder which is not paid by the ECSC when due shall bear
interest at the Default Interest Rate from the date that said sum
was due until actually paid by the ECSC.
(b) Not later than forty-five (45) days
prior to each Operating/Game Day Expense Reimbursement Date, the
Bills shall submit to the ECSC a Voucher for disbursement of
Operating/Game Day Expense Reimbursement in the amount of the
applicable percentage shown on Schedule 9.4 attached
hereto. As a courtesy, contemporaneous with the delivery of such
Voucher to the ECSC, the Bills shall provide the County with a
copy thereof. Provided no Material Sublessee Default has occurred
and is continuing, on each such Operating/Game Day Expense
Reimbursement Date, the ECSC shall remit to the Bills funds equal
to the applicable percentage of the Operating/Game Day Expense
Reimbursement due on such date according to such schedule.
(c) As soon as practicable following the
conclusion of each Lease Year, but in no event later that the
one-hundred and twentieth (120th) day thereafter, the Bills'
chief financial officer shall deliver to the ECSC a summary
(together with appropriate back-up documentation) establishing
the actual amount of Operating Expenses and Game Day Expenses
paid by the Bills during such Lease Year. As a courtesy,
contemporaneous with the delivery of such summary and back-up
documentation to the ECSC, the Bills shall provide the County
with copies thereof. In the event such summary reveals that the
actual amount of Operating Expenses and Game Day Expenses paid by
the Bills during the preceding Lease Year is less than the total
of all Operating/Game Day Expense Reimbursement payments made by
the ECSC during such Lease Year, such excess reimbursement shall
be offset against the next quarterly Operating/Game Day Expense
Reimbursement payment to be paid by the ECSC to the Bills
hereunder, unless such excess reimbursement shall have occurred
during the last year of the Term, in which case such excess
reimbursement shall be immediately repaid to the ECSC by the
Bills (which repayment obligation shall survive the expiration or
earlier cancellation or other cessation of the Term).
(d) In the event that the ECSC objects
to any Operating Expense or Game Day Expense item as shown in
such officer's report, the ECSC shall notify the Bills of such
objection not less than sixty (60) days after the receipt of the
summary provided for in Section 9.4(c). If, within thirty
(30) days after the receipt of any such objection notice, the
Bills and the ECSC are unable to agree upon the propriety of such
Operating Expense or Game Day Expense item reimbursed to the
Bills hereunder, the ECSC may instruct the Bills to engage an
independent nationally recognized certified public accounting
firm reasonably acceptable to the ECSC to determine the propriety
of such Operating Expense or Game Day Expense item for
reimbursement hereunder. The Bills shall direct such accountants
(i) to deliver their report (which shall be addressed to the ECSC
and the Bills) to such parties within a reasonable period (and in
no event later than forty-five (45) days) after being notified to
proceed with their review; and (ii) to advise the ECSC and the
Bills in such report whether the disputed item was properly
reimbursed hereunder. The report of such accountants will be
binding upon the ECSC and the Bills. To the extent that such
accountants determine that any Operating Expense or Game Day
Expense item reimbursed to the Bills was ineligible for such
reimbursement, the amount of such ineligible reimbursement shall
be deducted from the next quarterly Operating/Game Day Expense
Reimbursement Payment to be paid by the ECSC to the Bills
hereunder. The costs and expenses of such accountant |