June 11, 2018

Via E-Mail and Federal Express

James A. Balli, Esq.

Sams, Larkin, Huff & Balli
376 Powder Springs Street, Suite 100
Marietta, GA
30064-3448

RE: Second Notice of Default and Notice of Private Mediation Under Development
Agreement for Sun Trust Park - Failure to Pay System Development Fee

Dear Counsel,

We are in receipt of your correspondence dated May 30, 2018, in which you present the response
of the Braves Parties to Cobb County’s Notice of Default for failure to pay the SDF fee for Sun
Trust Stadium. Cobb County rejects the Braves’ position that the Braves have no obligation to
pay the SDF fee, as well as the Braves’ retaliatory demand for reimbursement of building permit,
project management and other fees in the amount of $4,683,300. Cobb County and the
undersigned counsel also note the excessive, inflammatory rhetoric that peppers the Braves’
response which, contrary to the tone at the very end of your letter, evidences bad faith toward
resolving this serious matter.

Among the many misrepresentations in your letter is the nature of the May 10, 2018 meeting
held between the County and the Braves Parties. As you are well aware, the primary purpose of
this meeting was to discuss the dedication by the Braves to the County of certain pedestrian
bridges and roads, and other general real estate issues relating to The Battery Atlanta Project.
You will also recall that the meeting opened with a discussion regarding the outstanding
$380,000 payment due from the Braves under the Agreement for Bridge Signage and
Maintenance. The SDF fee was discussed, but the majority of the meeting was related to the
aforementioned real estate matters. The County appropriately considered who would be best to
represent its interests on a variety of issues and simply took the opportunity, in good faith, to
raise the SDF fee. The County did so in order to discuss the dispute, face-to-face, prior to
sending a notice of default under the Development Agreement. Your speculation on the

Alan.Ritchie@ThompsonHine.com Phone 216.566.5616 Fax 216.566.5800 4819-4543-5751.7

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Page 2

County’s staffing decisions, legal fees, allegations of conflicts of interest and malpractice, and
other editorializing are improper and unprofessional. The County would prefer to get to the
point and deal with the SDF dispute in a professional manner.

Section 2.5 of the Development Agreement is not Applicable.

Your statement that “the Development Agreement specifically exempts the publicly owned
Stadium from any SDF fees” is wholly unsupported. Section 2.5 deals with the Development
Parcels (which, as expressly defined in the Development Agreement, excludes the Stadium Site)
and nothing else, and has no bearing on whether the SDF is a Stadium Cost and therefore owed
by the Braves Parties.

The Braves position is even more outrageous when one considers the entire Development
Agreement and the funding mechanism for Stadium Costs relating thereto. Based upon these
express funding provisions, the clear and unambiguous conclusion that Section 2.5 only relates
to the Development Parcels is crystal clear.

Accordingly, the foundation of your arguments on behalf of the Braves is built upon inferences
and implied meanings that simply are not possible given the plain and unambiguous language of
the entire Development Agreement. Your conclusion ignores the plain meaning of defined terms
“Stadium Cost” and “Development Parcels,” and the provisions of the Definitive Documents
relating to the payment of Stadium Costs, including, but not limited to, Article 6 of the
Development Agreement.

The Development Agreement is plain and unambiguous: the SDF falls squarely within the
definition of Stadium Costs, which are the responsibility of the Braves once the County
Contribution has been fulfilled, which it was long ago. Section 2.5, by its very terms, excludes
discussion of Stadium Costs and is therefore inapplicable to this discussion. Simply put, you
purport to invoke the common law on the plain meaning of a contract and then immediately
ignore that same plain meaning. 1 Your conclusion that Section 2.5 waives any impact or
connection fees, such as the SDF relating to the Stadium Site, is a fabrication of additional terms
and language out of thin air.

1
You cite to Freund v. Warren, 320 Ga. App. 765, 769 (2013) as support for the proposition that “no interpretation is allowed” of
unambiguous contracts. We note that at the same time you purport to invoke a rule requiring that the contract should be
interpreted within the four corners of the document, you raise the specter of disqualification due to the possibility of drafting
counsel being called as a witness in a dispute over the SDF. Leaving aside this improper read of the witness-advocate rule, which
indicates that you believe the Development Agreement is ambiguous on this issue and requires parole evidence in order to
ascertain the intention of the parties.
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Your letter also evidences a misunderstanding of the entire transaction outlined in the Definitive
Documents. The Stadium Project was funded in accordance with the definition of Stadium Costs
and Article 6 of the Development Agreement. As your client can explain to you, the funds for
Stadium Costs were collected into a “bucket” held by a trustee. Pursuant to the Development
Agreement, the County invested the County Contribution. After the County’s investment was
exhausted, the Braves were then obligated to invest the ANLBC Contribution for any Stadium
Costs in excess of the County Contribution. If more money was needed to pay for Stadium
Costs, then the Braves were clearly obligated under the Definitive Documents to pay for such
excess costs. The funding provisions provide for general, not specific funding, and Section 2.5
does not permit the Braves to avoid this simple structure in order to get out of paying commonly
and appropriately charged fees and costs directly related to the Stadium Project.

Having begun with the argument that Development Agreement is plain and unambiguous as to
payment of the SDF, you then cite to Allen v. Wright, 282 Ga. 9 (2007) for a doctrine of
construction which you contend is applicable to this dispute. There are multiple defects with this
argument. First, you conveniently glide over the assumption that the Development Agreement
can be categorized as a “quasi-ordinance,” yet provide no authority for the proposition that a
contract with a public entity may be treated as such. The County will not engage this argument
absent a valid basis for presenting it. Second, Allen v. Wright deals exclusively with the issue of
statutory construction. There is no contract at issue in the Allen case and it is therefore entirely
unrelated to this dispute. Third, the doctrine of construction in Allen is just that – a method for
guiding interpretation of an ambiguous statute. There is no such ambiguity in Section 2.5 of the
Development Agreement, so any use of a doctrine of construction is inappropriate.

The Braves’ obligation to pay for all Stadium Costs above the County Contribution, including
the unpaid SDF, is maintained.

The April 1, 2014 Draft Development Agreement is Dispositive of the Braves’ Obligation
to Pay the SDF.

Not only is the Development Agreement unambiguous on the issue of the Braves obligation to
pay the SDF, prior drafts of the Development Agreement put the County’s position beyond
doubt. In Section 2.5 of the Braves’ initial draft of the Development Agreement, the Braves
specifically requested that the County waive Impact Fees (which include the SDF) on the
Stadium Site. The County Attorney’s Office immediately rejected this proposal, deleted the
sentence and it never appeared again. Please note the following:

4-1-14 Draft of Section 2.5 of Development Agreement:

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2.5 Permits, Impact Fees and Connection Fees. The Braves Parties shall pay any and
all permit, development impact or connection fees (collectively, the “Impact Fees”)
assessed or imposed by the County in connection with the demolition, construction and
operation of any Improvements on or to be located on the Development Parcels; provided
that such Impact Fees shall be no greater than Impact Fees charged for other similar land
uses in other portions of County. The County agrees to waive all permit, Impact Fees to
the extent permissible with respect to the Stadium Site and the Authority Parking
Areas.

Final Section 2.5 of Development Agreement:

2.5 Permits, Impact Fees and Connection Fees. The Braves Parties shall pay any and
all Permit, development impact or connection fees (collectively, “Impact Fees”) assessed
or imposed by the County in connection with the demolition, construction and operation
of any Improvements on or to be located on the Development Parcels; provided that such
Impact Fees shall be no greater than Impact Fees charged for other similar land uses in
other portions of County. [INTENTIONALLY DELETED TEXT]

(Exhibit A hereto). The sentence on waiver of Stadium Site fees, drafted by the Braves, was
deleted by the County in a subsequent draft because the County did not agree to this term. This
version of Section 2.5 as edited by the County became the final version of Section 2.5, which the
Braves agreed to by signing the Development Agreement.

These prior drafts unequivocally establish that the County rejected the Braves’ attempt to
incorporate a waiver of the Stadium Site fees. If Section 2.5 so clearly establishes, as you
contend, that the Braves are somehow not obligated to pay Impact Fees on the Stadium Site, why
would the Braves and their able counsel include such a clause in their very first draft? Having
agreed to this deletion, the Braves will be estopped from arguing to the contrary. Doing so now,
with full knowledge of the prior negotiation of the Development Agreement, is brazen bad faith.

The SDF is Clearly Contemplated by the Term “Stadium Costs”.

The Development Agreement defines “Stadium Costs” as “all costs and expenses incurred or to
be incurred in connection with the development, design, construction and completion of the
Stadium Project…” . The Stadium Project, in turn, is defined as including “…Public
Infrastructure for the Stadium Site.” Finally, Public Infrastructure is defined as “…such
property, facilities and Improvements that facilitate the development and use of the
Stadium, the Stadium Site and the Authority Parking Areas, which may include, without
limitation (a) property and Improvements for drainage, sewage, and pipeline relocation…”
(Development Agreement, Section 1.1, “Definitions”). “Stadium Costs,” therefore, clearly
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contemplates fees exactly like the SDF, which are necessary for ensuring delivery and operation
of essential public infrastructure to the Stadium.

The Construction Management Agreement, drafted by the Braves, clearly identifies permit fees
and costs relating to bringing utilities to the project as “Cost of the Work.” Each Construction
Funding Requisition was submitted to the Trustee based upon the Construction Management
Agreement and only after the same was approved by Construction Administrator (a Braves’
entity), the County Representative and ANLBC. These are common hard, general conditions
and general requirements costs paid for by a contractor to get a project completed. To argue that
they were never part of the Braves project budget is not even plausible.

The Braves’ contention that the SDF is not identified in the Development Agreement or
elsewhere in the Definitive Documents is a meritless argument. The SDF is an existing, valid
and enforceable regulation. The Development Agreement expressly identifies Stadium Costs as
including all costs relating to facilities and improvements that facilitate development and use of
the Stadium, including, without limitation, improvements for drainage and sewage. The SDF is
exactly this kind of cost. Again, the Braves’ attempt to twist the meaning of the Development
Agreement otherwise is a clear attempt to avoid its contractual guarantee on all costs in excess of
the County Contribution.

The SDF is an Enforceable Legal Obligation in Cobb.

You claim that the SDF is “unconstitutional” and “illegal,” but do not even attempt to provide
any grounds whatsoever as a basis for this claim, presumably because you have none. Your
thinly-veiled threat of future baseless claims is noted. Regardless, the SDF fee is an express
regulatory obligation for development projects in Cobb County. It is fully implemented by the
Official Code of Cobb County, Ch. 122-82. The County is not required to place the Braves on
formal notice of an existing regulatory obligation that applies to all projects in the County
generally. Further, the calculation of the SDF is based on a detailed standard involving well-
established metrics that are generally applied to other SDF calculations in the County. The SDF
is binding on the Braves and must be paid.

The County and the Braves have Already Resolved the Remaining Payment on the
Transportation Improvement Fund.

The Braves’ demand for full payment of the Transportation Improvement Fund is entirely
unfounded. The Braves are well aware of the fact that the parties have resolved, through
multiple rounds of extensive meetings and negotiations, all projects and payments pursuant to
this obligation. Underscoring the erroneous nature of the Braves’ claim is that the Braves’ own
math doesn’t work – adding $1,543,175 the Braves claim they are owed to the $11,300,000 the
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Braves claim the County has already paid would result in $12,843,175, which still would not
resolve the Braves’ demand for the full $14,000,000.

The Braves’ argument also conflates the SDF payment with the Transportation Fund in obvious
bad faith. Attached hereto as Exhibit B is Agenda Item 2 from the June 13, 2017 meeting of the
Cobb County Board of Commissioners. This document provides a highly detailed review of this
entire issue between the parties. It also includes a summary of all funds expended and to be
expended in satisfaction of the Transportation Fund obligation. In particular, this summary (on
the final page of Exhibit B) details $2,216,459 in Fund projects which the County had already
performed and for which the County would be credited toward the $14,000,000 obligation. This
detailed list of projects contains no reference to the SDF. Moreover, the math in this document
adds up to $14,000,000, the correct sum of what has been paid and what will be paid by the
County.

The Development Agreement clearly contemplated that the parties would undertake the
administrative function of identifying the projects to be included and paid for by the
Transportation Improvement Fund. Such administrative matters contemplated by the Definitive
Documents do not rise to the level of a formal amendment but nevertheless represent an
agreement between the parties upon which the County clearly relied as evidenced by its wire
transfer of significant public money. Correspondence between the Braves and the County clearly
evidence an agreement on the Transportation Improvement Fund which was confirmed by the
Commissioners as stated above. We have been advised that Braves representatives were present
at the meeting on June 13, 2017. The County wired significant public funds to the Braves based
upon the confirmed agreement. The Braves have accepted and retained such public funds
pursuant to such confirmed agreement.

Based upon the foregoing, the County and the Braves have an enforceable agreement on the
Transportation Improvement Fund and reject your claim to the contrary.

The Braves are not Entitled to Reimbursement of the Building Permit Fee or Construction
Management Costs.

In addition to refusing to pay the SDF, in your letter the Braves appear to retaliate by demanding,
for the first time, reimbursement of the Building Permit Fee and alleged Project Management
Costs. Once again, other than conclusory allegations, your letter provides no evidence of
improper or uneven allocation of these funds.
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Conclusion and Notice of Private Mediation

Under the Definitive Documents, the Braves are expressly required (in multiple locations) to
guaranty all costs over and above the County Contribution. The County Contribution has already
been maximized, and the SDF fee is a cost which the Braves have guaranteed to cover. The
Braves are thus in default of the Development Agreement for failure to pay the SDF.

Further, the Braves’ counter-demands for transportation, building permit and construction
management costs are meritless. Any legitimate claims have already been resolved by the parties
by agreement and subsequent performance.

The County hereby demands that the Braves immediately fulfill all payment obligations under
the Development Agreement.

Additionally, the Braves remain in default and the County hereby gives its notice of private
mediation pursuant to Section 10.8.2 of the Development Agreement. We look forward to
discussing with you the selection of a mutually agreeable mediator.

Sincerely,

J.A. Schneider Alan S. Ritchie

cc: Cobb County Board of Commissioners

Mr. Greg Heller
Maxine Hicks, Esq.
Deborah Dance, Esq.
H. William Rowling, Esq.