In the wake of yesterday's CSN exclusive report on the Chicago Cubs contract with the Rooftops I have been inundated with requests for more on the contract and the language in several key passages. What follows is the exact contract language of several of the key parts of the 20-year contract that the Cubs and the Rooftops entered into on Jan. 27, 2004 and that expires on Dec. 31, 2023.
3. Payment obligations.
a) Each Rooftop shall pay the Cubs, on an annual basis, an amount equal to 17% of its Gross Revenues and 11% of its Billboard Revenues, if any (together, the "Royalty").
b) The Parties agree Rooftops are currently prohibited from displaying Billboards under City of Chicago law. Nothing in this Agreement will preclude the Cubs from opposing any change to the current law, including the placement of Billboards or any other advertising visible from inside Wrigley Field on any of the buildings in the Wrigley Field Adjacent Area.
6. Wrigley Field bleacher expansion.
6.1 If the Cubs expand the Wrigley Field bleacher seating and such expansion so impairs the view from any Rooftop into Wrigley Field such that the Rooftop's business is no longer viable unless it increases the height of its available seating, then such Rooftop may in its discretion elect to undertake construction to raise the height of its seating to allow views into Wrigley Field and the Cubs shall reimburse the Rooftop for 17% of the actual cost of such construction.
6.2 If the Cubs expand the Wrigley Field bleacher seating and such expansion so impairs the view from any Rooftop into Wrigley Field such that the Rooftop's business is no longer viable even if it were to to increase its available seating to the maximum height permitted by law, and if such bleacher expansion is completed within eight years from the Effective Date, then if such Rooftop elects to cease operations before the beginning of the next baseball season following completion of such expansion, the Cubs shall reimburse that Rooftop for 50% of the royalties paid by the Rooftop to the Cubs during the time between the Effective Date and the date of expansion of the Wrigley Field bleachers. The Cubs shall pay such reimbursement to the Rooftop within 30 days of receiving notice from the Rooftop it is no longer viable and has ceased operations. Any Rooftop receiving payment from the Cubs pursuant to this provision shall cease operations for the remainder of the Term and shall not seek or accept any compensation or benefit related to activity on a Rooftop on a day of a Game.
6.3 In the event of a dispute between the Cubs and any Rooftop regarding whether such Rooftop remains viable pursuant to Section 6.1 or 6.2 or whether (or to what extent) construction of new seating is required pursuant to Section 6.1, either Party may request such dispute be resolved pursuant to binding arbitration between the Parties pursuant to Section 9 below.
6.4 If the Cubs expand the Wrigley Field bleacher seating and such expansion impairs the view from any Rooftop into Wrigley Field such that Rooftop's Gross Revenue in the year of expansion is more than 10% below the average Gross Revenue for that Rooftop in the two years prior to expansion (normalizing for number of Games played, in rain-outs and doubleheaders, playoff games, work stoppage, replacement players, and the like), then the affected Rooftop can seek a reduction in the Royalty rate for all subsequent years of the Term. Upon such request, the parties shall meet and negotiate in good faith a new Royalty. If the Parties cannot agree, then the Rooftop may submit the issue of its appropriate Royalty rate to binding arbitration pursuant to Section 9.
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a.) In the event any Royalty is reduced pursuant to this section 6.3, the Cubs may seek to raise or restore the Royalty at a later date (e.g., in the event the Rooftop subsequently builds higher or the Rooftop's drop in the business proves temporary). Such revision may be negotiated between the parties or submitted to arbitration. Notwithstanding the foregoing, in no event may the Royalty exceed the 17%.
6.5 Nothing in this Agreement limits the Cubs' rights to seek approval of the right to expand Wrigley Field or the Rooftops' right to oppose any request for expansion of Wrigley Field.
6.6 The Cubs shall not erect windscreens or other barriers to obstruct the views of the Rooftops, provided however that temporary items such as banners, flags and decorations for special occasions, shall not be considered as having been erected to obstruct views of the Rooftops. Any expansion of Wrigley Field approved by governmental authorities shall not be a violation of this Agreement, including this section.
7.1 WGN-TV will show and comment upon the Rooftops' facilities during broadcasts of Cubs games and the Cubs will request other Cubs television broadcasting partners to do the same. If, however, there is a Billboard or other advertising on a Rooftop, WGN will not be required to show that Rooftop or comment on it and Cubs may request others not to show or comment.
7.2 Each Rooftop shall have a license during the Term to use the Cubs' Marks identified in Exhibit B solely for the purpose of marketing and promoting the sale of admissions to its Rooftop. The Cubs will not object to the Rooftops' use, solely for the same purpose, of the term "Wrigley Field". Each use of the Cubs Marks must include a trademark notice of registration or protection as shown on Exhibit B. The Cubs revise Exhibit B from time to time in their discretion. Rooftops may not use Cubs' Marks on merchandise, apparel, Billboard or to promote the sale of any other product or service.
7.3 From time to time during each season, the Cubs shall authorize WGN-TV or other Cubs broadcasting partner (s) to identify a phone number where fans can call to reserve Rooftop seating. Such phone number will provided to Cubs by the Rooftops jointly. The Rooftops shall determine how calls to that phone number will be apportioned among the various Rooftop businesses.
7.4 The Rooftops shall have the right to inform the public that they are endorsed by the Cubs.
7.5 The Cubs director of marketing shall meet with Rooftops before the start of each Major League Baseball season to discuss opportunities for joint marketing.
7.6 The Cubs shall include a discussion about the Rooftops on their tour of Wrigley Field and shall include stories positive about the Rooftops in The Vine Line.
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7.7 Each of the Rooftops may display broadcasts of Cubs games to patrons at its facility, including displaying such broadcasts on multiple television sets, without any infringement of any copyright owned by the Cubs or its assignees.
8.1 Each Rooftop agrees that it will not publicly disparage, abuse, or insult the business of the Cubs or the moral character of the Cubs or any of its employees.
8.2 The Cubs will not publicly disparage, abuse, or insult the business of any Rooftop or the moral character of any Rooftop or any Rooftop employee.
9.1 The arbitrators shall be chosen as follows: each of the Cubs and the Rooftop shall nominate three individuals to serve as arbitrator. None of these persons may be an employee of the Cubs or any Rooftop nor have any financial interest in the Cubs or any Rooftop. The affected Rooftop will then choose one of the three individuals nominated by the Rooftop. The two individuals selected as arbitrators will then meet and choose a third arbitrator to complete the panel, which third arbitrator must be an independent, third party with no relationship to or interest in (including without limitation any related or unrelated financial or business relationship) the Cubs or any Rooftop. If the arbitrators cannot agree on a third arbitrator, then each Party's arbitrator shall nominate one independent, third party who shall have no relationship or interest in (including without limitation any related or unrelated financial or business relationship) the Cubs or any Rooftop and who is not a current or former elected official or employee of the City of Chicago or any organization or entity who has received money form the Cubs or any Rooftop. The third arbitrator shall be chosen by lot from among those two individuals.
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9.2 In the event more than-one Rooftop is involved in a similar dispute related to this Agreement, the Parties may agree, but are not required to, arbitrate such dispute collectively. In such event, the affected Rooftops will agree on arbitrators pursuant to section 9.2 and collectively submit one set of choices to the Cubs.
9.3 Each Arbitration decision shall be binding on the Parties to that Arbitration and, unless the Cubs and all Rooftops agree in advance of the decision, shall be binding vis-à-vis each other only.
9.4 The losing party in the Arbitration shall bear the costs and fees of the Arbitration as well as the costs and fees of the prevailing party.