The city of Kent dumped tech company Amiga as naming-rights sponsor for the city's planned hockey arena after the company failed to deliver...
The city of Kent dumped tech company Amiga as naming-rights sponsor for the city’s planned hockey arena after the company failed to deliver a promised down payment Monday.
Amiga was supposed to pay $2.5 million by 5 p.m. to secure the $10 million, 20-year naming-rights deal for what would have been called The Amiga Center at Kent.
But in recent weeks, the city and company had sparred over details — such as control of advertising in the new arena — and Amiga had offered less money than initially promised, Kent officials said.
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By Monday evening, the deal was off, and city officials said they would look for a new sponsor.
“Clearly, there is a disappointment based on what Amiga could have brought to the table,” said Kent Mayor Suzette Cooke, who earlier had touted Amiga as a global technology leader that would make Kent a “leading technology hub.”
Cook said the failure of the naming-rights deal will not delay construction of the arena, due to open next year as the new home for the Seattle Thunderbirds hockey team.
Until another sponsor is found, the arena will be known simply as the Kent Events Center.
Amiga’s acting president, Bill McEwen, declined to comment Monday.
The collapse of the naming-rights deal was a striking reversal from the April news conference at which city officials boasted amid balloons and applause that Amiga would make Kent’s arena a high-tech wonderment and eventually bring its headquarters and hundreds of new jobs to the city.
But city officials at the time did not mention Amiga’s history of failed business ventures and unpaid debts, including an eviction from its Snoqualmie offices in 2002.
Some former employees have said they still are owed thousands of dollars in unpaid wages.
The company shut down its Washington corporation in 2004 and re-formed as a Delaware company with headquarters in New York — with new investors not obligated to pay those old debts, McEwen said in a May interview.
City officials said they were generally aware of the company’s past woes but believed it had new investors and was poised for a bright future.
After news reports in May on Amiga’s troubles, Kent officials unsuccessfully pressed the company to show its good faith by depositing the arena’s down payment in an escrow account.
Cooke said she was not sure what the end of the naming-rights deal means for Amiga’s stated goal of bringing its headquarters and hundreds of new jobs to the city.
The company’s small offices in Issaquah employ just a few people, although McEwen said in May that Amiga has 79 employees worldwide, with the bulk of them in India, and was determined to expand.
Construction on the 6,025-seat arena began Monday after the Kent City Council last week gave the final go-ahead to build the venue.
The arena will host concerts, car shows and other events in addition to hockey.
Kent City Council President Deborah Ranniger shrugged off the failure of the naming-rights deal, saying it was a minor part of the arena project.
“Not everything works out,” she said. “I think it’s time for us to move on and find an eager naming-right sponsor.”
The arena is expected to cost $73.8 million, $6 million more than originally estimated.
The city expects to pay most of that by issuing bonds that will be paid back with arena revenues.
The Legislature this year agreed to help pay a third of the cost by diverting a portion of the state sales tax collected in the city.
If the city fails to find another naming-rights sponsor, Kent will be on the hook for the additional money.
Cooke said she’s confident other companies will step forward.
“I’m not going to lose any sleep over it because it hasn’t set us back per se,” she said.
Jim Brunner: 206-515-5628 or firstname.lastname@example.org