Los Angeles Memorial Coliseum - trbas.com · Los Angeles Memorial Coliseum - USC Lease Terms Term: Use: Coliseum Concept Outline December 12,2007 For Discussion Only …

Los Angeles Memorial Coliseum - USC Lease Terms

Term:

Use:

Coliseum Concept Outline December 12,2007

For Discussion Only

Twenty five years with four five-year options and one two-year option to renew (options to be exercised by USC in its sole and absolute discretion).

All USC "home" football games, soccer games and lacrosse games to be played at Coliseum. Except for the existing annual Angel City Classic or similar substitute, between August 1 and December 15 of each calendar year, no other Division 1A college football game will be allowed without the approval of USC, such approval not to be unreasonably withheld. Additionally, USC shall be entitled to hold an additional five events at the Coliseum each year of the term.

Facility Rent: Eight percent (8%) of all gross ticket sales. For purposes of calculating gross sales, the minimum average ticket price for football games shall be Thirty Eight Dollars ($38.00) and the excluded tickets that are not part of "gross ticket sales" shall include: (a) student tickets; (b) facultylstaff tickets; (c) up to 5,000 complimentary tickets to be controlled by USC; and (d) the complimentary tickets provided to the Coliseum Commission, as set forth below. For soccer and lacrosse games, there shall be no minimum average ticket price. Throughout the term of this agreement, USC shall have complete use of and control over all seats within the facility and all public areas within the gates of the facility, including, without limitation, all tent areas in the Peristyle. Notwithstanding the foregoing, the Coliseum Commission shall retain use of and control of those areas occupied by concessionaires, the Coliseum Commission tent area, the Coliseum Commission complimentary tickets, the Coliseum Commission offices and the Old Press Box East Pad.

Game Day Ex- penses: Inside Stadium - All game day expenses shall be split 50-50.

Outside Stadium - USC and Coliseum shall split 50-50 cleaning costs, but only within Exposition Park. USC will bear no cost for security, traf- fic management and parking control personnel within Exposition Park with the exception of security personnel directly requested by USC for any USC function. USC will pay 100% of any cleaning and other costs incurred relating to its Cardinal and Gold functions held on Sports Arena property. USC and Coliseum will split 50-50 costs for any offsite shuttles employed for attendees. USC pays 100% of costs of all portable rest-

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rooms requested by USC.

Visual Transmis- USC shall pay to Coliseum eight percent (8%) of all revenue paid to USC sion: for the live over the air or by cable broadcast for any USC game played in

the Coliseum for which less than 70,000 tickets are sold, but in no event shall the total compensation paid to the Coliseum for facility rent and visual transmission exceed the amount of 8% of all gross ticket sales on the sale of 70,000 seats..

Concessions: Inside Stadium: The Coliseum Association shall pay to USC fifty percent (50%) of the revenue it receives for game days sales. In the event the Coliseum Commission elects to retain an unrelated, third-party concessionaire to provide concession services to the Coliseum, USC shall be entitled to fifty percent (50%) of the "house portion" of concession sales (i.e. the portion not retained by the concessionaire). The Coliseum Asso- ciation shall be required to use cash registers in the sale of concessions on USC game days and follow general acceptable accounting procedures with regard to its operations of concessions on such days.

Outside Stadium: USC may subcontract food sales. Any revenue received by USC shall be retained 100% by USC.

Novelties: USC shall pay to Coliseum seven and one-half percent (7 %%) of all game day novelty sales on Coliseum Commission property, whether inside or outside the fence line of the Coliseum. Coliseum Commission shall not allow any other vendor or individual to sell any novelties bearing any USC owned mark or name on its property on game days. Any breach of this provision by the Coliseum Commission shall result in a forfeit of the Coliseum Commission's share of novelty sales on such game day.

Programs: USC has the right to sell programs and retain 100% of those sales.

Advertising: Permanent Signage - Coliseum retains loo%, subject to provisions below regarding dedication of certain revenue to capital improvements. Coliseum shall not enter into any agreement with an athletic footwear or apparel company, a carbonated beverage, energy drink, water or isotonic beverage company, an office supply company or a tele- com/wireless/ISP/satellite or cable TV company for permanent signage without the prior approval of USC in its sole discretion. Notwithstanding anything contained herein to the contrary, the Coliseum Commission may not grant any advertiser other than the single Naming Rights Sponsor (described below) any exclusive right to advertise within the Coliseum which would interfere with or impair USC's right to sell advertising or sponsorship packages to any entity.

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Parking:

Game Day Signage (Subject to Sponsorship Rights Provisions Below):

Scoreboard - USC retains rights to digital content 100% and all revenue derived therefrom.

Video Board - USC retains digital content rightsloo% and all revenue derived therefrom.

Temporary Game Day Signage (which will be defined and will ex- clude on field advertising per NCAA rules) - USC retains 100% of the rights to content and revenue. Locations and size of signage shall include, but not be limited to, those locations and sizes of signage shown on the attached Exhibit A. Except as to permanent advertising and permanent identification signage, USC shall have sole, exclusive and complete control over all aspects of its games related to temporary stadium decor (graphics, flags, signs, pennants, balloons, etc.), including, without limitation, color and design. USC shall have the right to utilize draping and banners for decoration and to cover seat sections where necessary in the discretion and at the expense of USC.

Kiosks - USC may place booths, kiosks or tables inside stadium for sale of logo merchandise and promotions by USC sponsors and retains the right to 100% of the revenue derived therefrom (except to the extent such sales include novelties to which the Coliseum Commission retains 7 %% of net revenues).

USC shall receive 355 parking passes at no charge consistent with past practices. The 355 spaces consist of 55 spaces in the lot opposite Tunnels 6 and 7, 50 passes for South Coliseum Drive, 100 passes for North Coli- seum Drive and 150 passes for the VIP lot.

Commission Com- plimentary Tickets: Of the agreed number of complimentary tickets that are not part of "ticket

sales" for purposes of calculating rent, the Coliseum Commission shall receive at least 180 tickets per game that are situated between the goal lines.

Condition of In addition to the Coliseum Commission's obligation to perform im- Premises: provements to the Coliseum, as set forth herein, Coliseum Commission

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Insurance:

shall immediately bring the Coliseum into good order, condition and repair and maintain the Coliseum in good order, condition and repair throughout the term of this agreement.

USC may provide insurance or self-insure with general liability limits of $15 million. USC pays 100% of cost. If USC does not provide such insurance, then the Coliseum Commission may provide the insurance at a commercially reasonable per attendee charge to USC as has been past practice.

Football Practices: Between August 1 and December 15, USC may conduct practice on the day preceding a home football game. On dates approved by the Coliseum (which approval will not be unreasonably withheld or delayed), USC may conduct two spring practices and two practices not earlier than three weeks before USC's first game. All costs involved with practices, USC pays 100%. No rent will be charged for these events.

Payment Terms: USC pays rent on all season ticket sales prior to first game of season. All remaining facility rent and visual transmission money is due by the following February 15. All other amounts due and payable hereunder by either party to the other shall be paid within 45 days of receipt of an in- voice from the other party detailing such additional amounts due and payable. The parties will have mutual audit rights, and late payments will be subject to penalty.

Facility Fee: Currently there is no Facility Fee or admission tax, but in the event one is imposed that is targeted to the Coliseum, USC will get a like reduction in rent. If a citywide, statewide, countywide or similar tax or fee is imposed by others, such tax or fee would be due and payable by USC and other tenants without rent reduction.

Press Box: The Press Box and attached "East" and "West" Party Pads shall be exclu- sively controlled by USC on game days. The "Old Press Box East Pad" will be controlled by the Coliseum Commission.

Video Board: USC will be in control of the content on the Video Board beginning at least 3 hours before each game and not later than 1 hour after each game. Advertising content will be under the control of USC. Commission has the right to advertise upcoming Coliseum Commission events at least twice during the game, without charge.

Capacity: Minimum capacity for the stadium will be 90,000 or more permanent seats for the entire term in a configuration similar to that which exists on

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the commencement date of the Lease, with at least the same number of seats between the goal lines throughout the term of the Lease. Any poten- tial modifications which could impact such minimum would need the approval of USC, such approval not to be unreasonably withheld (for example, if modifications are required for code compliance, etc.).

NFL and Other Football Games: Another amateur or professional American-style football team shall be

permitted to play home games in the Coliseum only with USC's prior written consent, which may be withheld in USC's sole and absolute discretion notwithstanding any other terms or conditions in the lease agreement. Playing of the existing annual Angel City Classic, or similar substitute, will not require such consent. The existence of substantive discus- sions, if any, concerning a professional or collegiate football team leasing the Coliseum for its home games will be disclosed to USC and USC shall be entitled to participate in the discussion.

In the event the Coliseum Commission is able to attract a professional American-style football team to play all of its home games in the Coli- seum (and only if USC in it sole and absolute discretion consents to such use) and the addition of such team anticipates a renovation of the Coli- seum, then USC will be compensated for all losses incurred as a result of its temporary relocation, if any, during such renovation. Except as ex- pressly set forth herein, in no event would the USC lease be modified or terminated as a result of the additional American-style football team's presence at the Coliseum.

In the event USC has invested in an improvement of the Coliseum which will be removed or modified as a result of any such renovation, then prior to such renovation of the facility, USC shall be compensated for the following: (a) the entire cost of such improvements, less a commercially reasonable depreciation if USC is able to capitalize the improvement; and (b) the losses USC will sustain as a direct or indirect result of the renovation by or on behalf of the NFL. Such compensation to USC as refer- enced in subpart (a) above shall be reasonably reduced in the event a re- placement improvement of like quality and use is installed as part of the renovation of the facility.

Naming Rights: The Commission will endeavor to identifl and contract with a single Naming Rights Sponsor, on customary commercial terms, for purposes of "branding" the Coliseum and increasing Coliseum revenues for the public's benefit. The Commission will not be allowed to contract with a Naming Rights Sponsor engaged in the following businesses: an athletic footwear or apparel company, a carbonated beverage, energy drink, water or isotonic beverage company, an office supply company, a tele-

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com/wireless/ISP/satellite or cable TV company, an entity involved in the sale of alcohol, tobacco, firearms, pomographyladult-themed services or merchandise, any entity involved in gambling or wagering enterprises, or any other entity which engages in activities that would result in a viola- tion of NCAA , PAC-10 or USC rules or policies. .

As is customary, it is anticipated that the Naming Rights Sponsor Con- tract will officially re-name the venue as, by way of example only, "The [Sponsor] Memorial Coliseum." It will also provide the Naming Rights Sponsor with customary rights (subject to USC'.s sole and absolute discretion with regard to use of its name and marks and rights to payment described below) regarding permanent signage both inside and outside the Coliseum, field identification, promotional use of the Coliseum's name, category exclusivity within the Coliseum, premium seating and hospitality opportunities, media advertising on Coliseum controlled media, print ads in all Coliseum controlled publications and use of composite logos in and on publications, tickets, banners and the like.

At no cost to USC, USC will reasonably cooperate in the Coliseum's efforts to create a Naming Rights Sponsor package that will facilitate the marketing and attractiveness of such package, provided that in no event shall USC be obligated to participate in the marketing of such rights, and provided further that USC's reasonable cooperation shall in all instances be subject to the following:

Use of USC or USC's football marks or products shall be subject to USC's sole and absolute control, approval, and rights of en- forcement.

Out of the naming rights revenue:

o USC will be reimbursed for revenues that may be dis- placed by rights included in the Naming Rights Sponsor package that USC may have granted to others, should USC, in its sole and absolute discretion, agree to displace such other advertisers and allow such rights to be included in the Naming Rights Sponsor package, such as category exclusivity with USC football, premium seating at USC games, composite logos on tickets, game day promotional materials, and the like.

o If USC agrees, in its sole and absolute discretion to allow the Naming Rights Sponsor Contract to provide for spots on USC controlled broadcasts, presence on usctrojans.com andlor print ads in any USC publications, and such adver-

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tising as available, then USC will be paid amounts equiva- lent to USC's then-customary rates (i.e., rates USC charges others) for same, as such rates may be modified over time.

o USC will be reimbursed for any and all other losses, if any, that USC has as a result of the Coliseum contracting with a particular Naming Rights Sponsor or the package of rights granted to such sponsor.

"Founder, Partner, Club" and Similar Sponsor Programs The Commission will endeavor to identify and contract with a discrete

number of Stadium "Founders," "Club Members," "Partners," or similar Stadium Sponsors (however described) on customary commercial terms, for purposes of providing additional Coliseum revenues for the public's benefit. As is customary, it is anticipated that the rights of such Stadium Sponsors will not include branding of the Coliseum but could (subject to USC's rights to payment described below) include rights regarding permanent signage, hospitality opportunities, and media advertising within the Coliseum. In no event shall any sponsor other than the single Naming Rights Sponsor identified above have category exclusivity within the Coliseum and in no event shall USC be obligated in any way to assist with the Coliseum's efforts to create a Stadium Sponsor's package. Not- withstanding anything contained herein to the contrary, but without limit- ing the foregoing sentence, USC shall have no obligation to provide any Stadium Sponsor with any game day seats, right to use USC's name or marks or affiliation with USC in any of such Stadium Sponsor's advertising, or use of any of the public spaces in the Coliseum which are controlled by USC on game days.

Capital Improve- ments: The Coliseum Commission shall institute a program of capital improve-

ments that are substantial and will benefit the general public, including improvements based on the ISES Report commissioned by USC, which contemplates a series of projects designed to upgrade and improve the Coliseum (the "Capital Plan"). The Capital Plan shall include, but shall not be limited to, the following improvements to be performed within the express time periods set forth herein:

No later than the first year of the lease term, the Coliseum Commission shall (a) replace the existing video and score boards with new, state of the art video and score boards similar to those in place at the Texas or Ne- braska stadium; (b) replace and upgrade the entire sound and lighting sys-

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tem in the Coliseum with state of the art equipment and coverage; and (c) replace and upgrade the existing elevator and escalator systems in the Coliseum. No later than the second year of the lease term, the Coliseum Commission shall (a) upgrade all existing restroom facilities and add new restroom facilities in locations to be reasonably agreed to by the parties in the lease agreement; and (b) upgrade all of the existing concessions and add no less than six new permanent points of concession sales in locations to be reasonably agreed to by the parties in the lease agreement. No later than the third year of the lease term, the Coliseum Commission shall (a) replace and upgrade the fencing around the Coliseum, creating more dis- abled access points and a more efficient entry systems for patrons; and (b) replace all seating within the Coliseum and repair all concrete spalling under and around the seating areas, the stairways, the tunnels and all other points of public accommodation. No later than the fourth year of the lease term, the Coliseum Commission shall (a) purchase and install a state-of-the-art video board on the west end of the Coliseum; (b) grade and replace the field and drainage system to prevent water pooling and flooding; and (c) upgrade all of the locker room facilities to be compara- ble to the Rose Bowl.

The Capital Plan could also be augmented by "self-funding" projects, like club and suite facilities, so long as any such improvements do not reduce the total number of seats available to USC and USC approves of the improvements, in its reasonable discretion.

The Capital Plan will be in addition to the Commission's customary obligation to maintain the Coliseum in good order, condition and repair throughout the term of the Lease.

Day-to-day implementation of projects pursuant to the Capital Plan will include an advisory board of the Commission comprised of representa- tives of USC and the Commission. All projects will be sensitive to the historic significance of the Coliseum.

All such work shall be done in a manner that minimizes interruption with USC's use of the Coliseum, including, but not limited to, staging the work to occur outside of the regular collegiate football season.

In order to fund the Capital Plan, the Commission will create a special Sequestered Capital Improvements Account ("SCIA), which will be ad- ministered by and under the control of the Commission, but be subject to audit by USC, and which will be comprised of the following:

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All Naming Rights Sponsor revenue, net of payments and reimbursements to third parties (including USC);

Remedy:

All Stadium Sponsor revenue derived by the Coliseum Commis- sion, net of payments and reimbursements to third parties (including USC);

Unrestricted capital advances, if any, that may be made by concessionaires, which are to be recouped by the concessionaire out of future concession revenue streams;

Unrestricted capital advances, if any, that may be made by others acquiring rights in and to the Coliseum;

Current reserve accounts now dedicated to projects that are substantial and benefit the general public;

Bond proceeds, if any, net of the cost of issuance, reserves and discount; and

Other new capital sources identified and agreed upon by the parties.

All funds in the SCIA, including earnings thereon, net of the costs of ad- ministration, will be dedicated to funding projects in the Capital Plan, except that the Commission shall have the right to use such funds for capital expenditures outside the Capital Plan which are reasonably necessary for the protection of health and safety (such as code compliance) or to fund capital replacements of property or equipment that may fail suddenly or otherwise be the subject of sudden or catastrophic loss or damage.

USC shall have the right, but not the obligation, to perform repairs and improvements in and to the Coliseum, subject to the Coliseum Commis- sion's consent, not to be unreasonably withheld, conditioned or delayed.

In the event the Coliseum Commission fails to perform any of its obliga- tions set forth herein or in the definitive lease agreement, including, but not limited to, the failure of the Coliseum Commission to make capital improvements to the Coliseum, in addition to all the rights and remedies generally provided to tenants in leases for real property in California, USC shall be entitled to elect from the following two additional remedies: (a) specific performance of the Lease or (b) conversion of the lease agreement to a master lease whereby USC would assume year round op- erational responsibility of Coliseum for the remaining lease term (including any options exercised by USC). In the event the lease converts to a master lease, USC shall be required to contribute $50 million towards im-

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Priority:

proving the facility (in addition to having access to the funds in the SCIA for improvements) and shall pay the Coliseum Commission's master landlord (the State of California) its rent pursuant to the Coliseum Commis- sionlstate of California lease (such State rent not to exceed $1 million in the first year of the term, with reasonable CPI increases over the term).

During the term of this agreement USC shall be the primary tenant of the Coliseum. In this regard, USC shall be entitled to priority in scheduling over all other events at the Coliseum and shall enjoy "most favored na- tion" status in all leasing terms (i.e. no other tenant shall be leased the facility on more favorable terms than USC).

University Participa- tion in Coliseum Commission Proceedings: Subject to applicable legal constraints, the parties will work together to

explore the feasibility of providing a person named by USC with the abil- ity to participate in Commission proceedings on a basis different from members of the public generally. The parties acknowledge that the Com- mission itself does not have the power to add a USC representative to its membership.

Right of First Nego- tiation (Assignment of Ground Lease): In the event that the Commission, in its sole and absolute discretion, seeks

to assign all or any part of its interest in the State Ground Lease, or all or any part of the Commission's interest in the improvements comprising the Coliseum, during the term of the Lease, as it may be extended, then USC shall have a right of first negotiation regarding the same, except to the extent that any such preferential treatment does not conform to or is otherwise limited under law. In no event shall the Coliseum Commission be permitted to assign its interest in the State Ground Lease to the NFL or any other professional football league or organization.

Right of First Negotiation ("Lease"): To the extent permitted by law, USC shall have a right of first negotiation

to lease the Coliseum premises, or any part thereof, that may be offered for lease by the Coliseum Commission after the expiration of the term of the Lease, as it may be extended.

Possible Olympic Bid: USC will cooperate in any future Olympic bid involving the Coliseum.

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Conditions: The terms and conditions of this letter of intent shall be subject to the following conditions:

The negotiation of a formal, mutually acceptable Lease agreement and approval of same by the USC Board of Trustees and the Coliseum Com- mission.

A commercially reasonable non-disturbance agreement for the benefit of USC fiom the Coliseum Commission's master landlord, the State of Cali- fornia.

One seat on the Coliseum Commission for USC.

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EXHIBIT A

2007 USC Football Signage **THE NUMBER CORRESPONDS TO THE LOCATION ON THE MAP**

30' x 30' Lower Tarps (Below Jerseys) 19. Chevron 20. **USC OLD Signage** 21. AT&T 22. GMC 23. Chevron 24. AT&T 25. ***USC OLD Signage** 26. GMC

20' x 20' Speaker Signaee 27. AT&T 28. AT&T 29. AT&T 30. AT&T 3 1. **NO SIGNAGE** 32. **NO SIGNAGE*" 33. CYTOSPORT-MUSCLE MILK 34. CYTOSPORT-MUSCLE MILK

30' x 30' Jersevs - East End Zone 3 5. Jersey # 20 36. Jersey # 32 37. Jersey# 12 38. Jersey# 33 39. Jersey # 3 40. Jersey # 11 4 1. Jersey # 5 42. SC Interlock Banner

SUNDECK BANNERS

43. Banner on Top Rail of Sundeck 44. Speaker Tower Wraps

LEXUS BANNERS

45. Lexus Banner on grass area on North side of Stadium 46. Lexus Banner on grass area on South side of Stadium

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Flags: o 12 National Champions flags around press box in chronological order from left to right o 97 alternating cardinal & gold flags along the west side of the Coliseum

Sideline Banners: o Banners from Flying Colors to be affixed AND taken down around the sideline walls of

the stadium. o Banners from Flying Colors to be affixed AND taken down also on green fence in front

of Sundeck.

Field Tunnel Entrance: o Ceiling Banner (FOR WHOM THE BELL TOLLS)

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OUTSIDE GATE SIGNAGE (ALL SIGNS 74" HIGH)

Gate #I

Gate #4

Gate #11

t 177"+

**USC CREDIT UNION* *

Gate #19

t 177"+

**DOCTOR'S OF USC**

t81"+

**DOCTOR'S OF USC**

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t 177"3

**PARKING SPOT* *

t 177"3

**MUSCLE MILK**

t 177"+

**USC CREDIT UN- ION* *

Los Angeles Memorial Coliseum - trbas.com · Los Angeles Memorial Coliseum - USC Lease Terms Term: Use: Coliseum Concept Outline December 12,2007 For Discussion Only …

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