NASHVILLE, Tenn. -- A local investor group trying to buy the
Nashville Predators reached an agreement with city officials on
changes to the arena lease.
In the deal announced Friday afternoon, Mayor Karl Dean said the
team would be required to stay in Nashville for five years or it
would have to pay back the city its investment in the operations of
the Sommet Center.
"Nashville is guaranteed to have hockey for the next five years
and if that commitment cannot be met the city's investment will be
paid back," Dean said. "Most importantly, no additional property
tax money will be used to pay for the operation of the Sommet
The agreement must still must be approved by the Metro Sports
Authority and city council. The proposed $193 million purchase of
the team must be approved by the NHL's Board of Governors.
The group came together to make an offer to owner Craig Leipold
after he originally announced a deal to sell his team in May to
Canadian billionaire Jim Balsillie for $220 million. But the deal
fell through in June when the co-CEO of Blackberry makers Research
in Motion Ltd. started taking season-ticket deposits in Hamilton,
Leipold has said he has lost $70 million since starting the
team, and the latest potential buyers were seeking lease conditions
that would give them a better chance of turning a profit.
"Our group wishes to thank the fans for their continued
support, patience and enthusiasm for Predators hockey," said David
Freeman, a member of the investors group.
Seven of its nine members are from Nashville. The others,
businessman Doug Bergeron and venture capitalist William "Boots"
Del Biaggio, are from California.
According to a copy of the agreement provided by the mayor's
office, the city will pay Powers Management, the team's management
firm that operates the city-owned area, between $2 and $4 million a
year. The team will also see its annual rent lowered by $750,000.
The team will be allowed to terminate the lease before 2012 if
its losses in the next three years exceed $20 million and the
average paid attendance falls below 14,000.
Average ticket prices must be set lower than the league's
If the team wanted to terminate the lease in 2011, it would have
to pay the city $20 million. In 2012, $25 million. Any time after
five years it would have to pay $10 million.
The investor group planned an announcement earlier this week
amid reports that it had reached a deal after several weeks of
negotiation. But it was canceled at the last minute when city
officials said it was not final.