Bowlen reportedly paid between $65 million and $77 million to buy the Broncos, but the transaction actually occurred in several stages. Kaiser had sold off nearly 40 percent of the team to two minority partners, John Adams and Tim Borden, before putting his general-partnership interest on the block. In 1984 he agreed to sell his share to Bowlen for nearly $26 million; in addition, Bowlen agreed to assume the franchise's existing debt load, estimated at between $20 million and $30 million. The deal gave Bowlen the right to purchase the minority interest as well, which he did the following year, buying out Adams and Borden for another $20 million.
At the time, the price was one of the highest ever paid for an NFL franchise, but Bowlen, who'd previously eyed teams for sale in California and Texas, was eager to join the elite club of owners. So eager, in fact, that he agreed to give Kaiser a right of first refusal on future ownership changes, an unusual condition that could severely hinder his ability to deal with potential partners.
Yet even as Bowlen was agreeing to the costly terms of the deal, some of his other business ventures in the U.S. and Canada were starting to go south, along with the brief-lived 1980s energy boom. A year after he inked the purchase agreement, he had to negotiate a time extension to pay the remaining $13 million owed to Kaiser for his share of the team. (The delay cost him an additional $100,000 a month.) And by the time Bowlen bought out the other partners, he was already drawing on family resources to complete the sale. The minority partners' share was purchased not by Patrick Bowlen, but by PDB Enterprises, a wholly owned subsidiary of PDB Sports Holdings, Inc., a Nevada corporation in which Pat and siblings Bill, John and Mary Beth held equal voting shares; all of the company's non-voting stock was in their mother's trust.
Even bringing his family into the deal failed to solve Bowlen's cash-flow problems. He built sixty luxury skyboxes at Mile High Stadium and then, in 1987, sold them to a private management firm for a quick profit. The ready cash reportedly helped him complete his buyout of the minority owners but deprived the team of steady long-term revenue from the box rentals; the lack of such revenues was one of the primary reasons behind Bowlen's quest for a new stadium a decade later. (Playing at the old Mile High, the Broncos claimed to have posted an operating loss of $12 million in their 1997 Super Bowl season and reported a paltry $3.2 million in net revenues in 1999, putting them in the bottom third of the league in profitability. Bowlen has testified in open court that he expects the luxury boxes, increased ticket prices, parking and concession deals for Invesco Field at Mile High to boost his team's revenues by $40 million a year, making the Broncos one of the most profitable franchises in the NFL.)
Between 1985 and 1999, control of the ownership of the Broncos shifted from one Bowlen family corporate entity to another, through mergers, stock swaps and other mutations (see chart, page 22). One document filed in the Kaiser lawsuit lists fifteen separate corporate entities in Texas, Nevada, Colorado, Arizona and Canada holding an interest in the team at one point or another, most of them being single-purpose corporations involved in no other business. Doubtless some of the corporate juggling was designed to take advantage of changing tax laws, but it also appears that the Bowlen family was seeking to insulate the property from creditors, lawsuits, bankruptcies and miscellaneous mischief that had befallen other investments.
Kaiser contends that many of these transfers of ownership should have triggered his right of first refusal. The Bowlen camp maintains that the changes amount to a mere restructuring of paperwork rather than a sale to a third party. And in any case, Bowlen's supporters say, Kaiser knew about the involvement of his family from the beginning -- yet waited fifteen years to raise his objections.
An affidavit from William Britton, a Canadian barrister who represented Bowlen in the initial purchase of the team and during many subsequent changes in the ownership structure, states that Britton advised Kaiser's representatives of the family's role as far back as 1985, when the extension agreement was being negotiated. "Kaiser's attorneys knew by at least May 1985 that the Bowlen family did and would have ownership interests in the team," the affidavit states.
Furthermore, Bowlen's attorneys point out, Kaiser was an occasional guest in the new owner's box and had ample opportunity to learn from the team's official media guide or stories in the local newspapers that the Bowlen family owned the team. In fact, for many years, Kaiser requested additional media guides and Broncos gear -- sweats, jackets, hats and so on -- to be sent to the boatyard in Seattle where he stored his yacht.