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** Corrected from earlier e-mail with updated committee meeting information ** You have written in the past regarding the proposed sports arena. I am writing to provide you with an update. At its meeting earlier today, the Seattle City Council voted 6 to 2 to approve the three-party Memorandum of Understanding between the City of Seattle, King County, and ArenaCo, the investment group headed up by Chris Hansen. Because the Seattle City Council made changes to the MOU previously approved by the King County Council, the newly amended MOU must return to the King County Council for discussion and vote. The King County Council's Budget and Fiscal Management Committee anticipates taking up the MOU at a special meeting on Tuesday, October 2, beginning at 9:30 a.m. I was pleased to vote in support of the initial MOU when it was before the King County Council. I now look forward to reviewing the changes made by the Seattle City Council and am optimistic that the King County Council will vote to approve these changes. Again, thank you for contacting me. Please feel free to contact me in the future at (206) 296-1001 or firstname.lastname@example.org. You can also find me on Facebook. Sincerely, Bob Bob Ferguson King County Councilmember Metropolitan King County Council, District 1 516 3rd Avenue, Room 1200 Seattle, WA 98104 ph: (206) 296-1001 | fx: (206) 296-0198 For more information: http://www.kingcounty.gov/ferguson Visit our website to view the latest District 1 eNews
First Right to Distributions.
Further, to satisfy any default in (A) ArenaCo’s obligations under the Arena Use Agreement and (B) the NBA Team’s obligations under the non-relocation agreement required by paragraph 21.d, the City and County will also be entitled to receive the first distributions of any proceeds from any sale of the NBA Team, subject only to repayment of any obligations of the NBA Team related to any debt of the NBA Team to the NBA or other lenders approved by the NBA that are secured by the NBA franchise and other assets of the NBA Team up to the $125 million cap plus the amount of Public Financing used to fund the SODO Transportation Infrastructure Fund in the Second Installment up to an additional $25 million on such debt currently allowed under applicable NBA rules (“NBA Team Secured Debt Obligations”). The total NBA Team Secured Debt Obligations shall not exceed $150 million. ArenaCo Parent shall covenant not to enter into any agreement that would interfere with City's and County's rights to receive distributions of the proceeds of sale of the NBA Team payable to City and County as and when provided for in this MOU, and the NBA Team shall covenant not to enter into any agreement granting any lien, security interest or other encumbrance on the NBA Team's assets in excess of the NBA Team Secured Obligations. The Parties also agree to explore further ways to secure the obligations of ArenaCo, ArenaCo Parent and the NBA Team subject to NBA requirements, rules, regulations and agreements. Notwithstanding the foregoing, however, if the NBA revises its rules to allow NBA teams to borrow in excess of the current limit of $150 million that may be secured by the NBA franchise and other assets of NBA teams, then the NBA Team will be entitled to increase the amount of the NBA Team Secured Debt Obligations; provided, however, that the NBA Team will limit the amount of the NBA Team Secured Debt Obligations that will be senior to the right of the City and County to receive distributions of any proceeds from any sale of the NBA Team to the lesser of: (A) the maximum amount of NBA Team Secured Debt Obligations that is then allowed under NBA rules, or (B) 40% of the then "fair market value" ("FMV") of the NBA Team. The FMV of the NBA Team will be as mutually agreed upon in good faith by the Parties at that time; provided, however that if the Parties are unable to agree upon the FMV of the NBA Team at that time, then the FMV of the NBA Team will be determined by a sports industry recognized appraiser with experience in valuing NBA teams selected by the mutual agreement of the Parties pursuant to a customary valuation process to be specified in the Umbrella Agreement; but provided further, however, that if the NBA Team Secured Debt increase of the NBA Team is being sought in connection with the acquisition of the NBA Team on an arm’s-length basis by an unrelated party, then the FMV will be equal to the actual all-in acquisition price of the NBA
MEMORANDUM OF UNDERSTANDING SEATTLE SPORTS AND ENTERTAINMENT FACILITY
Burgess said after the news conference that he was skeptical of the deal when it was presented to the City Council in May, and grew more skeptical as he delved into it.
But eventually, he said, he realized "there's hidden opportunity here. Chris Hansen becomes the catalyst to do other things," like make transportation improvements in Sodo.
He said he's convinced there will be an arena built somewhere in the region soon, and it's better to get a direct benefit and be able to have some control over how it affects the Sodo neighborhood and KeyArena.
Asked whether there was anything the city wanted, but didn't get from Hansen, Burgess said, "Nothing. We got it all."
The commission is likely to seek a second, outside opinion on whether CEO Tay Yoshitani’s position on the board is a conflict of interest, said Commission Chairwoman Gael Tarleton.