REPORT TO STADIUM AUTHORITY BOARD
SUBJECT
Title
Action on the Stadium Manager's Request to Execute an Amendment to Existing Owner's Club Stadium Builders License Agreements to Extend the Term by One Year Due to COVID-19 Impacts
Report
BOARD PILLAR
Ensure Compliance with Measure J and Manage Levi's Stadium
BACKGROUND
As the Stadium Manager, Forty Niners Stadium Management Company, LLC is responsible for making recommendations to the Stadium Authority with respect to marketing, monitoring, and managing Stadium Builder License agreement (SBL) as required by the Management Agreement between the Stadium Authority and Stadium Manager.
The Stadium Authority's sale of SBLs is a source of revenue for the repayment of debt associated with the construction of the Stadium. The revenue generated by the sale of SBLs are dedicated for this purpose. Generally speaking, and for the vast majority of SBLs, an SBL Licensee (SBL Holder) generally has rights to separately and annually purchase 49ers season tickets for particular seats and priority right to purchase tickets to other non-NFL events at Levi's Stadium for the "Life of the Stadium". "Life of the Stadium" is defined in the SBL Agreement as the following: "so long as the Stadium is used for Events/Games; provided, if at some time following the thirtieth anniversary of the date of the first Event/Game, the Stadium undergoes a renovation or rebuilding that costs in excess of $300,000,000, then 'Life of the Stadium' shall not include the period from and after such renovation."
On the other hand, the category of SBL Holders who purchased "Owner's Club" level SBLs have different contract terms. First, the term of the agreement is limited to 20 years. Second, Owner's Club SBL Holders paid upfront for their SBL Agreement amenities, which include tickets to Team Games and other ticketed non-NFL events at Levi's Stadium. This payment is reflected in the price of their SBL. At $250,000 per SBL/per seat, Owner's Club SBLs are pr...
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