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St. Louis’ Offer to Rams Among Richest in Football : Relocation: Package ‘will far exceed’ local opportunity and could mean profit of $20 million a year, says team president Shaw. It likely will be presented to owner today.

TIMES STAFF WRITER

A staggering St. Louis offer to the Rams--including a $30-million payoff to Anaheim, coverage of the team’s 1994 losses and the potential for more than $20 million in annual profits--is expected to be presented to owner Georgia Frontiere today for her signature.

Included in the agreement is an unprecedented guarantee that at least 85% of luxury boxes and club seats will be sold for the next 15 years, accounting for at least $10 million annually for the team.

“I think it’s as good an economic deal as there is in football today,” said John Shaw, Rams president. “It’s a deal, as far as the economics are concerned, that will far exceed the Anaheim or Southern California opportunity.”

If Frontiere follows Shaw’s recommendation to accept the offer, she will also sell 30% of the Rams to Missouri businessman Stan Kroenke for approximately $60 million.

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The Rams’ move, which will be announced Tuesday in St. Louis if all paperwork is completed, will be conditional on:

* National Football League approval.

* St. Louis’ sale of about 45,000 personal seat licenses, which will range from $250 to $4,500.

* The 100% sale of club seat and sideline luxury boxes for the next three years.

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Shaw said the Rams will have the option to void the deal if St. Louis fails to meet conditions by the end of April.

“I feel all substantial points have some resolution, but until language is worked out, we have no deal,” Shaw said. “My anticipation is, if documents are completed by (today), we would go to St. Louis Sunday, review the situation and announce the move as early as Tuesday. If papers are not completed, then we won’t be going Sunday.”

After months of negotiations, Shaw reached an understanding with FANS, Inc.--the organization working to lure an NFL team to St. Louis--when it agreed to guarantee the sale of 85% of all club seats and luxury boxes for 15 years. The pledge is expected to be backed by Civic Progress, a coalition of St. Louis’ 28 largest businesses.

“That got us over the hump,” Shaw said.

The Rams will sign a 30-year lease and receive all revenue from concessions, while paying rent of $250,000 a year for the 70,000-seat domed stadium, which will be completed in late October.

The Rams will open the 1995 season in Busch Stadium and will have to seek a temporary quarters while awaiting the construction of a $12-million to $15-million practice facility. Shaw said the sides have not agreed on a site, but that will not delay Tuesday’s expected announcement.

“This transaction will be an intent to move to St. Louis, and until conditions are met and the transaction has closed, the team will still be in Los Angeles,” Shaw said. “As far as when we will physically move to St. Louis, that hasn’t really been determined yet.”

Much of the deal hinges on the sale of personal seat licenses, which have yet to be marketed. Fans who wish to buy season tickets will pay a one-time fee in addition to paying for the tickets.

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“The prime 50-yard-line type of seat will cost $4,500,” Shaw said. “There will be several thousand seats in the $250 range, and there will be 7,000 to 8,000 seats that will be sold on a game-to-game basis with no personal seat license fee.”

The sale of seat licenses, which is expected to generate more than $60 million, will be used to:

* Pay off the estimated $30 million owed on the outstanding bonds for the renovation of Anaheim Stadium when the Rams moved in 1980.

* Cover all legal expenses in preparing for the move as well as any legal costs that might arise from lawsuits being filed.

* Take care of any damages that might be owed on Juliette Low School once the team gives six-months notice it is vacating Rams Park.

* Cover all moving expenses.

* Build the team’s new practice facility.

* Contribute to the expenses St. Louis will absorb for marketing the personal seat licenses.

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* Pay St. Louis beer distributor Jerry Clinton $8 million for giving up his share of the stadium lease.

* Reimburse the Rams for 1994 losses, which Shaw projected to be $6 million to $7 million, the result of poor attendance, decreased radio rights and an increased payroll.

There was speculation earlier that St. Louis would also cover an expected $12 million to $15 million NFL relocation fee--paid to NFL owners for eliminating the expansion opportunity in a new city. But Shaw said that issue hasn’t been addressed yet.

“It is not part of the deal,” Shaw said. “There appears to be some confusion on the matter. St. Louis will pay for all of our relocation costs, but as for a fee for moving to another city and removing the expansion opportunity, I’m not sure that exists in this case because the NFL owners rejected expansion in St. Louis.”

Shaw declined to place an exact figure to the team’s projected profit as a result of the St. Louis deal, but he said if the stadium sells out, “I think the club will do very well.”

“The basic deal is a brand new facility with virtually all revenue streams to the tenant, including club seating and a large number of executive suites at virtually no cost to the tenant.”

A source close to the negotiations, asked if a $20-million profit was in the ballpark, said, “That’s a little conservative.”

While the Rams’ move is conditional, Shaw said St. Louis is not “guaranteeing” the sale of 45,000 personal seat licenses.

“They don’t know how many they can sell,” Shaw said. “The sale of the seats is a condition to the deal being completed. They anticipate selling that many, and we have asked them to hit a minimum number by the time of the National Football League owners meetings in March.

“We anticipate closing the deal two to five weeks after, and if, we gain NFL approval, and at that time we will be looking for all conditions of the deal to have been met. If they are unable to reach the numbers, then we have the option of voiding the deal.”

The Rams must submit to the NFL a statement of reasons for their move, and after the league conducts a 30-day investigation, they will need 23 of 30 team owners to vote in their favor for NFL approval.

“I think we will file an application with the league in the next couple of weeks,” Shaw said. “We will probably wait until the owners meeting for the league vote, but will take direction from the commissioner if he wants to have an earlier meeting.

“I can’t predict how owners are going to vote, but I think it serves the league’s interests at this time to allow the team to move to St. Louis. We’re moving from a two-team marketplace so the fans of Los Angeles won’t be denied the opportunity for a football team. We’re moving into a marketplace that’s unoccupied.”

There has been some speculation in the league that the Rams have already been assured of league approval. Insiders said if the Rams were concerned about having their application rejected, they would have filed an antitrust suit in Missouri, which would have provided home-court advantage in the event litigation became necessary. The NFL also has the option of filing a similar suit, and would do so in California if it wanted to block the move, but there has been no indication the league is considering such an action.

The St. Louis transaction, which involved the work of former Sen. Thomas F. Eagleton and the combined efforts of local politicians and businessman, is separate from the sale of 30% of the Rams to Kroenke, but both announcements could come Tuesday.

‘We don’t have a price totally set at this time, but there is an understanding between ownership and Kroenke,” said Shaw, who previously estimated the value of the franchise at $200 million. “We would like to complete the sale transaction by the time of the announcement, but we’re not absolutely sure we can have the paperwork done.”

Kroenke will have first right of refusal if Frontiere elects to sell the team at a later date, but there is no option to gain majority interest at some point, as he had wanted.

“We look to him as being an active partner who will contribute to the success of the franchise,” Shaw said. “But by league rules and definition, all control has to be vested in one partner, which in the case here will be Georgia.”

The Rams seriously considered Baltimore after making it known they were available to move, but Peter Angelos, the CEO of the Baltimore Orioles, did not prove to be a compatible business partner, and Baltimore had yet to begin construction on a new stadium.

Kroenke’s low profile, which included his willingness not to demand majority interest at some point, and St. Louis’ ability to provide an all-but-finished new stadium prompted Shaw to focus on FANS (Football at the New Stadium).

As for Anaheim and Save the Rams, did they ever have a chance?

“I think one of our high priorities was a brand new football-only facility,” Shaw replied. “That was one of the main things we were looking for.”

St. Louis, like Anaheim, failed to show much support for a losing football team a few years ago. The Cardinals enjoyed 10 winning seasons in their 28-year run in St. Louis and left for Phoenix in 1987 after city politicians couldn’t produce a new stadium.

They will now be getting a team that hasn’t advanced to the playoffs since 1989, a team that has compiled a 23-57 record the past five years.

“I think we minimized our financial risk in coming to St. Louis, but there is always a responsibility and obligation to try and put a good product on the field,” Shaw said. “Fans want to see a good product, and our fan base will be hurt if we’re not competitive. But our financial risk will not be as great in St. Louis if that happens.

“We provided a good product for a number of years in Anaheim, but it’s clear in the last five years that we put a poor product on the field in Anaheim. I’m sorry and regret that we didn’t put a better product on the field here.”

Shaw, who has not visited St. Louis since 1986, said he will retain his position with the team for the time being and will commute between Los Angeles and St. Louis. One of the first questions he will undoubtedly have to address in St. Louis will be in regard to an earlier statement challenging the passion of fans there.

“That’s somewhat of an inaccurate statement,” Shaw said. “I never questioned St. Louis as a sports market. I made the statement Baltimore displayed greater passion, and that was my feeling at the time. All of our marketing surveys indicated that Baltimore had a greater passion for football.

“That wasn’t meant to say that St. Louis doesn’t have any passion for a football team. I think they have demonstrated by this transaction that they have quite a bit of passion for football.”


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