<PAGE>
 
                                                                   EXHIBIT 10.16

THIS INSTRUMENT PREPARED BY
AND AFTER RECORDING RETURN TO:

Cadwalader, Wickersham & Taft
100 Maiden Lane
New York, New York 10038
Attention:  Linda Grant Williams, Esq

================================================================================


                         SALE AND SERVICING AGREEMENT
                           Dated as of July 29, 1998


                                     among


                              DENVER ARENA TRUST
                                (Issuer Trust)


                                      and


                           ASCENT ARENA COMPANY, LLC
                           (Transferor and Servicer)


                                      and


                             THE BANK OF NEW YORK
                              (Indenture Trustee)


                              DENVER ARENA TRUST
                          ARENA REVENUE BACKED NOTES


================================================================================
<PAGE>
 
                               TABLE OF CONTENTS

<TABLE> 
<CAPTION> 
                                                                                                               Page
     <S>                                                                                                       <C> 
                                                        ARTICLE I

                                                      DEFINITIONS
                                                      -----------

      Section 1.01   Definitions..............................................................................    1       
      Section 1.02   Other Definitional Provisions............................................................    1
                                                      
                                                       
                                                        ARTICLE II  
                                                      
                                               CONVEYANCE OF THE TRUST ASSETS
                                               ------------------------------
                                                                                                                      
      Section 2.01   Conveyance of the Trust Assets...........................................................    2    
      Section 2.02   Ownership and Possession of Contract Files...............................................    2    
      Section 2.03   Books and Records........................................................................    3    
      Section 2.04   Delivery of Trust Asset Documents........................................................    3    
      Section 2.05   Acceptance by the Indenture Trustee of the Trust Assets; Certification by the Custodian..    4    
      Section 2.06   Construction and Operation of New Arena Facility.........................................    5    
      Section 2.07   Transferor Indemnities...................................................................    7     
                                                      
                                                      
                                                          ARTICLE III   
                                                      
                                                 REPRESENTATIONS AND WARRANTIES
                                                 ------------------------------
                                
      Section 3.01   Representations and Warranties of the Transferor.........................................    7    
      Section 3.02   Representations and Warranties of the Servicer..........................................    11    
      Section 3.03   Transferor's Obligation to Cure.........................................................    12     
                                
                                
                                                           ARTICLE IV
                                                                        
                                                   ADMINISTRATION AND SERVICING    
                                                   ----------------------------
                       
      Section 4.01   Duties of the Servicer..................................................................    13    
      Section 4.02   Maintenance of Filings..................................................................    15    
      Section 4.03   Subsequent Revenue Agreements...........................................................    16    
      Section 4.04   Subservicing............................................................................    16    
      Section 4.05   Successor Servicers.....................................................................    18    
      Section 4.06   144A Information........................................................................    18    
      Section 4.07   Administrative Duties of Servicer.......................................................    18     
</TABLE> 

                                      -i-
<PAGE>
 
<TABLE> 
     <S>                                                                                                         <C> 
                                                     ARTICLE V

                                             ESTABLISHMENT OF TRUST ACCOUNTS
                                             -------------------------------

      Section 5.01   Collection Account......................................................................    20    
      Section 5.02   Distributions to Certificateholders and Noteholders.....................................    23    
      Section 5.03   Debt Service Coverage Account, Debt Service Reserve Account, Capitalized Interest Account,             
                     Construction Fund Account, Lease Reserve Account and Paying Account.....................    24    
      Section 5.04   Trust Accounts; Trust Account Property..................................................    28     
                                                       
                                                       
                                                     ARTICLE VI

                                 STATEMENTS AND REPORTS; SPECIFICATION OF TAX MATTERS 
                                 ----------------------------------------------------

      Section 6.01   Statements..............................................................................    30    
      Section 6.02   Specification of Certain Tax Matters....................................................    32     


                                                    ARTICLE VII 
                       
                                            GENERAL SERVICING PROCEDURE  
                                            ---------------------------
                         
      Section 7.01   Security Interest.......................................................................    33    
      Section 7.02   Lockbox Agreement; Lockbox Account; Lockbox Bank........................................    33    
      Section 7.03   Servicing Compensation..................................................................    34    
      Section 7.04   Statement as to Compliance and Financial Statements.....................................    34    
      Section 7.05   Independent Public Accountants Servicing Report.........................................    35    
      Section 7.06   Right to Examine Servicer Records.......................................................    35    
      Section 7.07   Reports to the Indenture Trustee; Collection Account Statements.........................    36    
      Section 7.08   Financial Statements....................................................................    36    
      Section 7.09   Accounting and Reports..................................................................    36     
                         
                         
                                                    ARTICLE VIII
                                             
                                                    THE SERVICER
                                                    ------------
                                                         
      Section 8.01   Indemnification; Third Party Claims.....................................................    37    
      Section 8.02   Merger or Consolidation of the Servicer.................................................    39    
      Section 8.03   Limitation on Liability of the Servicer and Others......................................    39    
      Section 8.04   Servicer Not to Resign; Assignment......................................................    40    
      Section 8.05   Relationship of Servicer to Issuer Trust and the Indenture Trustee......................    40    
      Section 8.06   Servicer May Own Securities.............................................................    40     
</TABLE> 

                                     -ii-
<PAGE>
 
<TABLE> 
     <S>                                                                                                         <C> 
                                                     ARTICLE IX

                                                      DEFAULT
                                                      -------

      Section 9.01   Servicer Events of Default..............................................................    41  
      Section 9.02   Indenture Trustee to Act; Appointment of Successor......................................    42
      Section 9.03   Waiver of Defaults......................................................................    44
      Section 9.04   Accounting Upon Termination of Servicer.................................................    44
      Section 9.05   Transferor Defaults.....................................................................    44 


                                                       ARTICLE X 

                                                      TERMINATION
                                                      ----------- 

      Section 10.01  Termination.............................................................................    45
      Section 10.02  Notice of Termination...................................................................    46 
                                  
                                  
                                                       ARTICLE XI
                                  
                                               MISCELLANEOUS PROVISIONS 
                                               ------------------------ 
                           
      Section 11.01  Acts of Noteholders.....................................................................    46
      Section 11.02  Amendment...............................................................................    46
      Section 11.03  Recordation of Agreement................................................................    47
      Section 11.04  Duration of Agreement...................................................................    47
      Section 11.05  Governing Law...........................................................................    47
      Section 11.06  Notices.................................................................................    47
      Section 11.07  Severability of Provisions..............................................................    48
      Section 11.08  No Partnership..........................................................................    48
      Section 11.09  Counterparts............................................................................    48
      Section 11.10  Successors and Assigns..................................................................    48
      Section 11.11  Headings................................................................................    48
      Section 11.12  Actions of Securityholders..............................................................    49
      Section 11.13  Reports to Rating Agency................................................................    49
      Section 11.14  Certificateholders......................................................................    50
      Section 11.15  Limitation of Liability.................................................................    50
      Section 11.16  Third Party Beneficiaries...............................................................    50
      Section 11.17  Limitation on Recourse..................................................................    50 
</TABLE> 

                                     -iii-
<PAGE>
 
                                   EXHIBITS

EXHIBIT A - List of Revenue Agreements
EXHIBIT B - Form of Servicer's Remittance Report to Indenture Trustee
EXHIBIT C - Construction Phase Agreement
EXHIBIT D - Security Agreement [Excess Collateral]
EXHIBIT E - Operating and Management Agreement
EXHIBIT F - Legal Description of the Property

                                     -iv-
<PAGE>
 
          This Sale and Servicing Agreement is entered into effective as of July
29, 1998, among DENVER ARENA TRUST, a Delaware business trust (the "Issuer
                                                                    ------
Trust"), ASCENT ARENA COMPANY, LLC, a Colorado limited liability company as
-----
Transferor (in such capacity, the "Transferor") and Servicer (in such capacity,
                                   ----------                                  
the "Servicer"), and THE BANK OF NEW YORK, a New York banking corporation, as
     --------                                                                
Indenture Trustee on behalf of the Noteholders (in such capacity, the "Indenture
                                                                       ---------
Trustee").
-------   

                             W I T N E S S E T H:

          In consideration of the mutual agreements herein contained, the Issuer
Trust, the Transferor, the Servicer and the Indenture Trustee hereby agree as
follows for the benefit of each of them and for the benefit of the holders of
the Notes and the Trust Certificates issued hereunder:

                                   ARTICLE I

                                  DEFINITIONS
                                  -----------

          Section 1.01  Definitions.
                        -----------   

          Except as otherwise expressly provided herein, capitalized terms used
herein shall have the meanings assigned to such terms in Appendix A attached
                                                         ----------         
hereto.

          Section 1.02  Other Definitional Provisions.
                        -----------------------------   

          (a)  All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.

          (b)  As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate or
other document to the extent not defined, shall have the respective meanings
given to them under GAAP. To the extent that the definitions of accounting terms
in this Agreement or in any such certificate or other document are inconsistent
with the meanings of such terms under GAAP, the definitions contained in this
Agreement or in any such certificate or other document shall control.

          (c)  The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; and Article, Section,
Schedule and Exhibit references contained in this Agreement are references to
Articles, Sections, Schedules and Exhibits in or to this Agreement unless
otherwise specified.

                                      F-1
<PAGE>
 
          (d)  The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.

          (e)  Any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and assigns.

                                  ARTICLE II

                        CONVEYANCE OF THE TRUST ASSETS
                        ------------------------------

          Section 2.01  Conveyance of the Trust Assets.
                        ------------------------------    

          (a)  As of the Closing Date, in consideration of the Issuer Trust's
delivery of cash to be disbursed pursuant to the Construction Phase Agreement
and the Trust Certificates to the Transferor or its designee, the Transferor,
concurrently with the execution and delivery hereof, does hereby sell, transfer,
assign, set over and otherwise convey to the Issuer Trust, without recourse, but
subject to the other terms and provisions of this Agreement, all of the right,
title and interest of the Transferor in and to the Trust Assets.

          (b)  As of the Closing Date, the Issuer Trust acknowledges the
conveyance to it of the Trust Assets, including all right, title and interest of
the Transferor in and to the Trust Assets, receipt of which is hereby
acknowledged by the Issuer Trust. Concurrently with such delivery and in
exchange therefor, pursuant to the Indenture and the Security Agreement
[Indenture Trustee], the Issuer Trust has collaterally assigned the Trust Estate
to the Indenture Trustee, and has executed and caused the Notes to be
authenticated and delivered by the Indenture Trustee to the Noteholders upon the
order of the Issuer Trust. In addition, the Issuer Trust, pursuant to the
instructions of the Transferor, has executed and caused the Trust Certificates
to be authenticated and delivered to the Transferor or its designee, upon the
order of the Transferor.

          Section 2.02  Ownership and Possession of Contract Files.
                        ------------------------------------------   

          Upon the issuance of the Notes, the ownership of each Trust Asset and
the contents of the related Indenture Trustee's Contract File shall be vested in
the Issuer Trust and collaterally assigned to the Indenture Trustee for the
benefit of the Noteholders, and the Custodian shall take possession of the
Indenture Trustee's Contract Files as contemplated in Section 2.05 hereof.
                                                      ------------         
Possession of the Servicer's Contract Files on behalf of and for the benefit of
the Noteholders shall remain with the Servicer.

                                      F-2
<PAGE>
 
          Section 2.03  Books and Records.
                        -----------------   

          Each of the Servicer and the Custodian shall be responsible for
maintaining, and shall maintain, a complete set of books and records for each
Trust Asset which shall be clearly marked to reflect the ownership of each Trust
Asset by the Issuer Trust and the pledge of each Trust Asset to the Indenture
Trustee for the benefit of the Noteholders.

          It is the intention of the parties hereto that the transfers and
assignments contemplated by this Agreement shall constitute a sale of the Trust
Assets from the Transferor to the Issuer Trust and such property shall not be
property of the Transferor. If the assignment and transfer of the Trust Assets
to the Issuer Trust pursuant to this Agreement or the conveyance of the Trust
Assets is held or deemed not to be a sale or is held or deemed to be a pledge of
security for a loan, the Transferor intends that the rights and obligations of
the parties shall be established pursuant to the terms of this Agreement and
that, in such event, (i) the Transferor shall be deemed to have granted and does
hereby grant to the Issuer Trust a first priority security interest in the
entire right, title and interest of the Transferor in and to the Trust Assets
and all proceeds thereof and (ii) this Agreement shall constitute a security
agreement under applicable law. On the Closing Date, the Transferor shall cause
to be filed UCC-1 financing statements naming the Issuer Trust as the "secured
party" and describing the Trust Assets being sold by the Transferor to the
Issuer Trust with the office of the Secretary of State of Colorado and in such
other offices as may be required to perfect the security interests granted under
this Section 2.03, within or without the State of Colorado, under the Uniform
Commercial Code as in effect in the State of Colorado.

          Section 2.04  Delivery of Contract Files and Other Conditions to
                        --------------------------------------------------
Closing.
-------   

          The parties hereby agree that the obligation of the Issuer Trust to
(i) disburse the purchase price to be paid to the Transferor in accordance with
the Construction Phase Agreement and (ii) issue the notes pursuant to the
Indenture, is subject to the fulfillment of each of the following conditions on
the Closing Date:

          (a)  The Transferor shall deliver or cause to be delivered to the
Custodian, as the designated agent of the Indenture Trustee, each of the
following documents (collectively, the "Indenture Trustee's Contract Files"):
                                        ----------------------------------    
(i)  the originally executed version of each Revenue Agreement, including all
then existing schedules and exhibits thereto, (ii) the originally executed
version of each Pledged Contract, including all then existing schedules and
exhibits thereto, and each Security Document (including conformed copies of the
recorded Construction Phase Mortgage and Assignment of Construction Phase
Mortgage, including all then existing schedules and exhibits thereto), and (iii)
all Insurance Policies and the originally executed payment and performance bonds
naming the Issuer Trust or the Indenture Trustee as additional insureds, loss
payees or dual obligees, as applicable.  The Indenture Trustee shall cause the
Custodian to take and maintain continuous physical possession of the Indenture
Trustee's Contract Files in the State of New York and, in connection therewith,
shall act solely as agent for the Noteholders in accordance with the terms
hereof and not as agent for the Transferor or any other party.

                                      F-3
<PAGE>
 
          (b)  The Transferor shall deliver or cause to be delivered to the
Servicer each of the following documents (collectively, the "Servicer's Contract
                                                             -------------------
Files"):  copies of the Revenue Agreements, the Pledged Contracts and the
-----                                                                    
Security Documents, including all then existing schedules and exhibits attached
thereto.

          (c)  The Transferor, at its own expense, shall record this Agreement,
a Declaration and Notice of Rights, the Easement Agreement [Luxury Suite License
Agreements], the Easement Agreement [Major Revenue Agreements], and an
Assignment and Conveyance with respect to each Revenue Agreement (which may be a
blanket assignment if permitted by applicable law) in the appropriate records.
The Transferor shall also record in Colorado the Construction Phase Mortgage and
the other documents specified in Section 3.04 of the Construction Phase
Agreement. The original of this Agreement and each Security Document recorded
shall be returned to the Indenture Trustee for inclusion in the Indenture
Trustee's Contract Files. In the event that any such document is lost or
returned unrecorded because of a defect therein, the Transferor shall promptly
prepare a substitute document or cure such defect, as the case may be, and
thereafter the Transferor shall be required to submit each such document for
recording.

          (d)  All conditions precedent to the Issuer Trust's obligation to
enter into the transactions contemplated herein and in the other Basic Documents
and to make the initial disbursement under the Construction Phase Agreement as
set forth in Article III of the Construction Phase Agreement shall have been
satisfied.

          Section 2.05  Acceptance by the Indenture Trustee of the Trust Assets;
                        --------------------------------------------------------
                        Certification by the Custodian.
                        ------------------------------   

          (a)  The Indenture Trustee agrees to cause the Custodian to execute
and deliver on the Closing Date an acknowledgment of receipt of the Indenture
Trustee's Contract Files.  The Indenture Trustee declares that it will cause the
Custodian to hold such documents and any amendments, replacements or supplements
thereto, as well as any other assets included in the Trust Estate and delivered
to the Custodian, in trust, upon and subject to the conditions set forth herein.
The Indenture Trustee agrees to cause the Custodian to review the Indenture
Trustee's Contract Files delivered to it and to cause the Custodian to deliver
to the Transferor, the Indenture Trustee, the Issuer Trust and the Servicer,
within five Business Days after the Closing Date, a certification (the
"Custodian's Certification") to the effect that (i) all documents required to be
 -------------------------                                                      
delivered to the Indenture Trustee pursuant to Section 2.04 are in the
                                               ------------           
possession of the Custodian on the Indenture Trustee's behalf, and (ii) all
documents delivered by the Transferor to the Custodian pursuant to Section 2.04
                                                                   ------------
hereof have been reviewed by the Custodian and have not been mutilated or
damaged and appear regular on their face (handwritten additions, changes or
corrections shall not constitute irregularities if initialed by the Obligor).
Neither the Issuer Trust nor the Custodian shall be under any duty or obligation
to inspect, review or examine any such documents, instruments, certificates or
other papers to determine that they are genuine, enforceable or appropriate for
the represented purpose or that they are other than what they purport to be on
their face.  In performing any such review, the Custodian may conclusively rely
on the Transferor as to the purported genuineness of any such 

                                      F-4
<PAGE>
 
document and any signature thereon. Neither the Issuer Trust nor the Custodian
shall have any responsibility for determining whether any document is valid and
binding, whether the text of any assignment or endorsement is in proper or
recordable form, whether any document has been recorded in accordance with the
requirements of any applicable jurisdiction or whether a blanket assignment is
permitted in any applicable jurisdiction. If a material defect in a document
constituting part of the Indenture Trustee's Contract Files is discovered, then
the Transferor shall comply with the cure provisions of Section 3.03 hereof.
                                                        ------------        

          (b)  The Servicer's Contract Files shall be held in the custody of the
Servicer for the benefit of, and as agent for, the Noteholders and the Indenture
Trustee for so long as the Indenture continues in full force and effect; after
the Indenture is terminated in accordance with the terms thereof, the Servicer's
Contract Files shall be held in the custody of the Servicer for the benefit of,
and as agent for, the Certificateholders.  The Servicer shall promptly report to
the Indenture Trustee any failure by it to hold the Servicer's Contract Files as
herein provided and shall promptly take appropriate action to remedy any such
failure.  In acting as custodian of such documents, the Servicer agrees not to
assert any legal or beneficial ownership interest in the Trust Assets.  The
Servicer agrees to indemnify the Securityholders, the Indenture Trustee, and the
Owner Trustee for any and all liabilities, obligations, losses, damages,
payments, costs or expenses of any kind whatsoever which may be imposed on,
incurred by or asserted against the Indenture Trustee, the Securityholders or
the Owner Trustee as the result of any act or omission by the Servicer relating
to the maintenance and custody of such documents which have been delivered to
the Servicer; provided, however, that the Servicer will not be liable for any
portion of any such amount resulting from the gross negligence or misconduct of
any Securityholder, the Owner Trustee or the Indenture Trustee; and provided,
further, that the Servicer will not be liable for any portion of any such amount
resulting from the Servicer's compliance with any instructions or directions
consistent with this Agreement issued to the Servicer by the Indenture Trustee
or the Owner Trustee.  The Indenture Trustee shall have no duty to monitor or
otherwise oversee the Servicer's performance as custodian hereunder.

          Section 2.06  Construction and Operation of New Arena Facility.
                        ------------------------------------------------   

          (a)  The Transferor hereby agrees, for the benefit of the Issuer
Trust, the Servicer, the Indenture Trustee and the Noteholders, that it shall
complete the construction of the New Arena Facility in a timely manner in
accordance with and pursuant to the terms and conditions of this Agreement, the
Arena Agreement and the Construction Phase Agreement and shall cause the Teams
to play all home games at the New Arena Facility in accordance with the Team
Commitments and cause the New Arena Facility to be operated and maintained by
the Operator (as defined below) in accordance with the Operating and Management
Agreement, a copy of which is attached as Exhibit E hereto, the Arena Agreement
                                          ---------
and the Lease. The Transferor has appointed its Affiliate, Ascent Arena
Operating Company, Inc., as the Operator (the "Operator"), under the Operating
and Management Agreement.

          (b)  The Construction Phase Mortgage (and upon its release and the
conveyance of the Property to the City, the Leasehold Mortgage), is being
executed and 

                                      F-5
<PAGE>
 
delivered, and all material contracts related to the construction and operation
of the New Arena Facility are being pledged by the Transferor to the Issuer
Trust to secure the performance of the Transferor of its obligations under
Section 2.06 (a) above pursuant to the Security Agreement [Excess Collateral] 
----------------                                                 
and the Assignment of Pledged Contracts. The Issuer Trust's interests in such
Pledged Contracts together with the Issuer Trust's interests under the
Construction Phase Mortgage, the Revenue Agreements and the Revenue Agreement
Rights, are further pledged to the Indenture Trustee pursuant to the Security
Agreement [Indenture Trustee] and the Assignment of Pledged Contracts [Indenture
Trustee] to secure the Issuer Trust's obligation to repay the Notes.

          (c)  When (i) the construction of the New Arena Facility has been
completed, (ii) the Construction Consultant has so certified to the Issuer Trust
and the Indenture Trustee, (iii) the Certificate of Substantial Completion has
been delivered by the Transferor to the City, (iv) all conditions to conveyance
of the Property as set forth in Section 3.6.1 of the Arena Agreement have been
satisfied or waived by the City, (v) the Issuer Trust and the Indenture Trustee
have received from a title insurance company satisfactory to them, either (A) a
paid title insurance policy in respect of the Leasehold Mortgage or (B) an
irrevocable agreement satisfactory to the Issuer Trust and the Construction
Consultant from such company to issue a paid title insurance policy upon
recordation of the Leasehold Mortgage, in either case such policy shall be in
form and substance satisfactory to the Issuer Trust and the Construction
Consultant, and shall contain such endorsements and reinsurance agreements as
they shall require, together with an as-built ALTA survey of the real property
described in Exhibit A to the Leasehold Mortgage and the New Arena Facility and
             ---------                                                         
other improvements located thereon, and (vi) all conditions precedent to the
commencement of payments under the Revenue Agreements have been satisfied,
waived or are otherwise reasonably likely to be satisfied; then the Indenture
Trustee and the Issuer Trust shall release and reconvey the Construction Phase
Mortgage to the Transferor and Nuggets LP, and require the execution,
recordation and delivery of the Leasehold Mortgage in their favor in lieu
thereof.  If and when the Issuer Trust has been replaced by a New Qualified
Mortgagee, and such New Qualified Mortgagee has entered into the Intercreditor
Agreement [New Qualified Mortgagee] then, and only then, shall the security
interests in the Excess Collateral be released in whole at the Transferor's
expense; otherwise, they shall remain in full force and effect.  No release of
the Excess Collateral other than as described herein shall be valid unless
executed by the Indenture Trustee.  The Indenture Trustee and the Issuer Trust,
upon the Transferor's written request and at the Transferor's expense, shall
deliver to the Transferor all documents reasonably necessary to evidence such
release.

          (d)  The parties hereby agree that the amount of damages that will be
incurred by the Issuer Trust if the Transferor does not perform its obligations
hereunder and thereby causes a Transferor Default to occur is indefinite and
difficult to ascertain.  Accordingly, the parties hereby agree that in the event
that the Transferor does not perform such obligations, subject to Section 11.17
                                                                  -------------
hereof, the Transferor shall pay to the Issuer Trust, as liquidated damages, an
amount equal to the Outstanding Amount, any unpaid interest and costs and
expenses of any enforcement.

                                      F-6
<PAGE>
 
          Section 2.07  Transferor Indemnities
                        ----------------------

          The Transferor hereby agrees that it shall be obligated to return all
security deposits received by it under the Luxury Suite License Agreements and
any other cash payments or deposits received by it under any of the other
Revenue Agreements pursuant to the terms of such agreements and agrees to
indemnify and hold harmless the Issuer Trust against any and all claims or
damages with respect to such cash payments or deposits.  The Transferor further
agrees that to the extent it has received cash payments or deposits which are
subject to return or forfeiture under any of the Pledged Contracts, or to the
extent it is obligated to indemnify any Pledged Contract Obligor under any of
the Pledged Contracts, the Transferor shall indemnify and hold harmless the
Issuer Trust against any and all claims or damages with respect to such cash
payments or deposits or such indemnity obligations.

                                  ARTICLE III

                        REPRESENTATIONS AND WARRANTIES
                        ------------------------------

          Section 3.01  Representations and Warranties of the Transferor.
                        ------------------------------------------------   

          The Transferor hereby represents and warrants to the Servicer, the
Indenture Trustee, the Noteholders and the Issuer Trust that as of the Closing
Date (except as otherwise specifically provided herein):

          (a)  The Transferor is a limited liability company duly organized,
validly existing, and in good standing under the laws of the State of Colorado,
with full power and authority to own its assets and to conduct its business as
such assets are currently owned and such business is presently conducted and has
all licenses necessary to carry on its business as now being conducted, and has,
and had at all relevant times, full corporate power to execute and deliver each
of the Initial Revenue Agreements, the Pledged Contracts, the Construction Phase
Agreement and the Security Documents to which it is a party; the Transferor has
the power and authority to execute and deliver this Agreement and to perform in
accordance herewith; the execution, delivery and performance of this Agreement
(including all instruments of transfer to be delivered pursuant to this
Agreement) by the Transferor and the consummation of the transactions
contemplated hereby have been duly and validly authorized by all necessary
action of the Transferor; this Agreement evidences the valid, binding and
enforceable obligation of the Transferor; and all requisite action has been
taken by the Transferor to make this Agreement valid, binding and enforceable
upon the Transferor in accordance with its terms, subject to the effect of
bankruptcy, insolvency, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally or the application of
equitable principles in any proceeding, whether at law or in equity;

          (b)  The Transferor is duly qualified to do business and is in good
standing, and has obtained all necessary licenses and approvals in all
jurisdictions in which the ownership or lease of its assets or the conduct of
its business shall require such qualifications;

                                      F-7
<PAGE>
 
          (c)  The consummation of the transactions contemplated by this
Agreement will not result in (i) the breach of any terms or provisions of the
articles of organization or operating agreement of the Transferor, (ii) the
breach of any term or provision of, or conflict with or constitute a default
under or result in the acceleration of any obligation under, any material
agreement, indenture, loan or credit agreement or other material instrument to
which the Transferor or its assets is subject, or (iii) the violation of any
law, rule, regulation, order, judgment or decree to which the Transferor or its
assets is subject;

          (d)  The Transferor is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or other governmental agency, which default might reasonably be
expected to have a materially adverse effect on the condition (financial or
otherwise) or operations of the Transferor or its assets or that would
reasonably be expected to have a materially adverse effect on its performance
hereunder;

          (e)  Each of the Initial Revenue Agreements, the Pledged Contracts and
the Security Documents to which it is a party has been duly and validly
authorized, executed and delivered by the Transferor and constitutes a legal,
valid and binding obligation of the Transferor, enforceable against the
Transferor in accordance with its terms subject as to enforceability to
applicable bankruptcy, reorganization, insolvency, moratorium or other similar
laws affecting creditors' rights generally and to general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law);

          (f)  There are no actions or proceedings against, or investigations
of, the Transferor currently pending with regard to which the Transferor has
received service of process and no action or proceeding against, or
investigation of, the Transferor is, to the knowledge of the Transferor,
threatened or otherwise pending before any court, administrative agency or other
tribunal that (A) if determined adversely, would prohibit its entering into this
Agreement or render the Notes invalid, (B) seek to prevent the issuance of the
Notes or the consummation of any of the transactions contemplated by this
Agreement or (C) if determined adversely, would prohibit or materially and
adversely affect (i) the ability of the Transferor to perform its obligations
hereunder and under the Initial Revenue Agreements, the Pledged Contracts, and
the Security Documents to which it is a party, (ii) the sale of the Trust Assets
to the Issuer Trust or (iii) the performance by the Transferor of its
obligations under, or the validity or enforceability of, this Agreement or the
Notes;

          (g)  No consent, approval, authorization or order of any court or
governmental agency or body, other than the City pursuant to the Arena
Agreement, is required for:  (1) the execution, delivery and performance by the
Transferor of, or compliance by the Transferor with, this Agreement, the Initial
Revenue Agreements, the Pledged Contracts and the Security Documents to which it
is a party, (2) the issuance of the Notes, and (3) the sale of the Trust Assets
under this Agreement and the consummation of the transactions required of it by
this Agreement, except such as shall have been obtained on or before the Closing
Date;

                                      F-8
<PAGE>
 
          (h)  No Officer's Certificate, statement, report or other document
prepared by the Transferor and furnished or to be furnished by it pursuant to
this Agreement or the other Basic Documents contains any untrue statement of
material fact or omits to state a material fact necessary to make the statements
contained herein or therein not misleading; and the information pertaining to
each Revenue Agreement set forth on Exhibit A hereto is true and accurate in all
                                    ---------                                   
material respects;

          (i)  The Transferor is solvent, is able to pay its debts as they
become due and has capital sufficient to carry on its business and its
obligations hereunder; it will not be rendered insolvent by the execution and
delivery of this Agreement or by the performance of its obligations hereunder;
and no petition of bankruptcy (or similar insolvency proceeding) has been filed
by or against the Transferor prior to the date hereof;

          (j)  The Transferor has transferred the Trust Assets without any
intent to hinder, delay or defraud any of its creditors;

          (k)  The Transferor is the lawful owner of the Trust Assets with the
full right to transfer the Trust Assets free from any and all claims and
encumbrances whatsoever, except for the City's subordinate Lien under the Arena
Agreement as described in the City Intercreditor Agreements, and the Trust
Assets, upon the transfer thereof to the Issuer Trust as contemplated herein,
will be free and clear of all liens, claims and encumbrances, except for the
City's subordinate Lien under the Arena Agreement as described in the City
Intercreditor Agreements; this Agreement constitutes a valid sale, transfer,
assignment, and conveyance to the Issuer Trust of all right, title, and interest
of the Transferor in, to, and under all the Trust Assets now existing and
hereafter created, and any related agreements under which the Trust Assets arose
or will arise, all moneys due or to become due with respect thereto and all
proceeds (as defined in the UCC as in effect in New York and all of the states
where the Transferor's chief executive office or books and records relating to
the Trust Assets are located) of such Trust Assets and any property relating
thereto, and such property will be held by the Issuer Trust free and clear of
any Lien of any Person claiming through or under the Transferor, except for the
City's subordinate Lien under the Arena Agreement as described in the City
Intercreditor Agreements;

          (l)  All filings and recordings required to perfect the title of the
Issuer Trust to the Trust Assets purchased hereunder have been accomplished and
are in full force and effect, and the Transferor shall at its expense perform
all acts and execute all documents requested by the Issuer Trust, the Servicer
or the Indenture Trustee at any time to evidence, perfect, maintain, and enforce
the title of the Issuer Trust in such Trust Assets and the security interest of
the Issuer Trust in the Excess Collateral and the security interest and priority
of the Indenture Trustee in the Collateral, including filing of continuation
statements as required by applicable state law;  the Transferor will, at the
reasonable request of the Issuer Trust, the Servicer, or the Indenture Trustee,
execute and file additional financing statements reasonably satisfactory in form
and substance to the Servicer, the Issuer Trust or the Indenture Trustee, as the
case may be;

                                      F-9
<PAGE>
 
          (m)  Each Initial Revenue Agreement and Pledged Contract (i) contains
all of the understandings and agreements between the Transferor and the related
Obligor with respect to the subject matter thereof, (ii) is in existence and in
full force and effect as of the Closing Date, and (iii) has not been modified or
amended, and the provisions have not been waived at any time since the effective
date of such Initial Revenue Agreement and Pledged Contract;

          (n)  No default exists under the terms of any of the Initial Revenue
Agreements, and all Required Payments due on or prior to the Closing Date have
been made in full by the related Revenue Contractor;

          (o)  There are no offsets, counterclaims or other defenses available
to the Revenue Contractor under any Initial Revenue Agreement against the
Transferor;

          (p)  Except as otherwise expressly disclosed in a letter addressed to
the Issuer Trust (i) the Property has been evaluated by environmental
investigations and studies as disclosed in the VCUP; (ii) Hazardous Materials at
the Property are being addressed pursuant to the VCUP; (iii) the VCUP was
reviewed and approved by the CDPHE pursuant to Colorado's Voluntary Cleanup &
Redevelopment Act; and (iv) EPA reviewed an earlier version of the VCUP which
did not include certain additional source removal work, concurred with the
cleanup and monitoring proposals set forth therein, and concluded that under the
circumstances, EPA intervention under CERCLA and the federal Clean Water Act was
not warranted.

          (q)  The New Arena Facility is covered by customary hazard insurance
policies, special hazard insurance policies, general and specific liability
insurance policies and such other insurance policies as are customary and usual
in the sports arena industry and for the jurisdiction in which the New Arena
Facility is located; all Insurance Policies relating to the New Arena Facility
have been issued by an insurer rated at least "A6" by A.M. Best, and such
Insurance Policies are in full force and effect, have been issued in amounts
which are customary and usual in the sports arena industry and for the
jurisdiction in which the New Arena Facility is located, and name the Issuer
Trust and the Indenture Trustee as loss payees thereunder to the extent of the
Outstanding Amount of the Notes;

          (r)  Any and all requirements of any federal, state or local law
applicable to the Initial Revenue Agreements and Pledged Contracts and the use,
operation, maintenance and construction of the New Arena Facility have been
complied with in all material respects to the extent now required; and

          (s)  Upon the execution and delivery of this Agreement by the parties
hereto, the Issuer Trust, or its designees, will have the sole and exclusive
right and authority to enter into any Subsequent Revenue Agreement, subject to
the City Intercreditor Agreements.

          It is understood and agreed that the representations and warranties
set forth in this Section 3.01 shall survive delivery of the Indenture Trustee's
                  ------------                                                  
Contract Files to the Custodian (as the agent of the Indenture Trustee), the
conveyance of the Trust Assets to the Issuer Trust, the grant of a security
interest in the Trust Assets to the Indenture Trustee and the 

                                      F-10
<PAGE>
 
issuance of the Notes, and shall inure to the benefit of the Noteholders, the
Servicer, the Indenture Trustee, the Owner Trustee and the Issuer Trust. Upon
discovery by any of the Transferor, the Servicer, the Indenture Trustee or the
Issuer Trust of a breach of any of the foregoing representations and warranties
that materially and adversely affects the value of any Trust Asset or the
interests of the Noteholders therein, the party discovering such breach shall
give prompt written notice (but in no event later than two Business Days
following such discovery) to the other parties. The obligations of the
Transferor set forth in Section 3.03 hereof to cure any breach shall constitute
                        -----------  
the sole remedy available hereunder to the Noteholders, the Servicer, the
Indenture Trustee or the Issuer Trust respecting a breach of the representations
and warranties contained in this Section 3.01.
                                 ------------ 

          Section 3.02  Representations and Warranties of the Servicer.
                        ----------------------------------------------   

          The Servicer hereby represents and warrants to and covenants with the
Issuer Trust, the Indenture Trustee, the Noteholders, and the Transferor that as
of the Closing Date or as of such other date specifically provided herein:

          (a)  The Servicer is duly organized, validly existing, and in good
standing under the laws of the jurisdiction of its organization, with full power
and authority to own its assets and to conduct its business as such assets are
currently owned and such business is presently conducted and has all licenses
necessary to carry on its business as now being conducted; the Servicer has the
power and authority to execute and deliver this Agreement and to perform in
accordance herewith; the execution, delivery and performance of this Agreement
by the Servicer and the consummation of the transactions contemplated hereby
have been duly and validly authorized by all necessary action of the Servicer;
this Agreement evidences the valid, binding and enforceable obligation of the
Servicer; and all requisite action has been taken by the Servicer to make this
Agreement valid, binding and enforceable upon the Servicer in accordance with
its terms, subject to the effect of bankruptcy, insolvency, reorganization,
moratorium and other, similar laws relating to or affecting creditors' rights
generally or the application of equitable principles in any proceeding, whether
at law or in equity;

          (b)  The Servicer is duly qualified to do business and is in good
standing, and has obtained all necessary licenses and approvals in all
jurisdictions in which the ownership or lease of its assets or the conduct of
its business shall require such qualifications;

          (c)  The consummation of the transactions contemplated by this
Agreement will not result in (i) the breach of any terms or provisions of the
organizational documents of the Servicer, (ii) the breach of any term or
provision of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any material agreement, indenture, loan or
credit agreement or other material instrument to which the Servicer, its members
or its assets is subject, or (iii) the violation of any law, rule, regulation,
order, judgment or decree to which the Servicer or its members or its assets is
subject;

          (d)  The Servicer is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or other governmental agency, which default might have consequences
that would materially and 

                                      F-11
<PAGE>
 
adversely affect the condition (financial or otherwise) or operations of the
Servicer, its members or its assets or might have consequences that would
materially and adversely affect its performance hereunder;

          (e)  There are no actions or proceedings against, or investigations
of, the Servicer currently pending with regard to which the Servicer has
received service of process and no action or proceeding against, or
investigation of, the Servicer is, to the knowledge of the Servicer, threatened
or otherwise pending before any court, administrative agency or other tribunal
that (A) if determined adversely, would prohibit its entering into this
Agreement or render the Notes invalid, (B) seek to prevent the issuance of the
Notes or the consummation of any of the transactions contemplated by this
Agreement or (C) if determined adversely, would prohibit or materially and
adversely affect the performance by the Servicer of its obligations under, or
the validity or enforceability of, this Agreement or the Notes;

          (f)  No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Servicer of, or compliance by the Servicer with, this
Agreement, or for the consummation of the transactions contemplated by this
Agreement, except for such consents, approvals, authorizations and orders, if
any, that have been obtained prior to the Closing Date;

          (g)  The Servicer is an Eligible Servicer and shall service and
administer contracts and receivables in accordance with Accepted Servicing
Procedures;

          (h)  No Officer's Certificate, statement, report or other document
prepared by the Servicer and furnished or to be furnished by it pursuant to this
Agreement or any other Basic Document contains any untrue statement of material
fact or omits to state a material fact necessary to make the statements
contained herein or therein not misleading; and

          (i)  The Servicer is solvent and will not be rendered insolvent as a
result of the performance of its obligations pursuant to this Agreement;

          It is understood and agreed that the representations and warranties
set forth in this Section 3.02 shall survive delivery of the Indenture Trustee's
                  ------------                                                  
Contract Files to the Indenture Trustee and shall inure to the benefit of the
Issuer Trust, the Transferor, the Noteholders, the Indenture Trustee and the
Owner Trustee.  Upon discovery by any of the Transferor, the Servicer, the
Indenture Trustee or the Issuer Trust of a breach of any of the foregoing
representations and warranties that materially and adversely affects the value
of any Trust Asset or the interests of the Noteholders therein, the party
discovering such breach shall give prompt written notice (but in no event later
than two Business Days following such discovery) to the other parties.

          Section 3.03  Transferor's Obligation to Cure.
                        -------------------------------    

          (a)  Upon discovery by the Servicer, the Transferor, the Custodian,
the Issuer Trust, the Indenture Trustee or any Noteholder of a breach of any of
the representations and warranties set forth in Section 3.01, or a deficiency in
                                                ------------  
the documents delivered pursuant to 

                                      F-12
<PAGE>
 
Section 2.04(a) hereof, which materially and adversely affects the value of the
Trust Assets or the interests of the Noteholders in the related Trust Asset
(each such Trust Asset, a "Defective Trust Asset"), the party discovering such
                           ---------------------
breach or the failure to deliver a document shall give prompt written notice to
the others. The Transferor shall promptly, but in any event within 60 days of
the earlier of its discovery or its receipt of notice of any breach of a
representation or warranty or document deficiency, cure such breach in all
material respects.

          (b)  It is understood and agreed that the obligation of the Transferor
set forth in this Section 3.03 to cure a Defective Trust Asset constitutes the
                  ------------                                                
sole remedy hereunder of the Indenture Trustee, the Issuer Trust, the Servicer
and the Noteholders respecting a breach of the representations and warranties
contained in Section 3.01 hereof, or the failure to deliver a document pursuant
             ------------                                                      
to Section 2.04(a).  Any cause of action against the Transferor relating to or
arising out of a defect in any Indenture Trustee's Contract File as contemplated
by Section 2.05 hereof or against the Transferor relating to or arising out of a
   ------------                                                                 
breach of any representations and warranties made in Section 3.01 hereof shall
                                                     ------------             
accrue as to any Trust Asset upon (i) discovery of such defect or breach by any
party and notice thereof to the Transferor or notice thereof by the Transferor
to the Indenture Trustee, and (ii) failure by the Transferor to cure such defect
or breach as specified above.

          (c)  Neither the Issuer Trust nor the Indenture Trustee shall have any
duty to conduct any affirmative investigation other than as specifically set
forth in this Agreement as to the occurrence of any condition requiring the cure
of any breach of a representation and warranty pursuant to this Section or the
eligibility of any Trust Asset for purposes of this Agreement.

                                  ARTICLE IV

                         ADMINISTRATION AND SERVICING
                         -----------------------------

          Section 4.01  Duties of the Servicer.
                        ----------------------   

          (a)  Servicing Standard.  The Servicer, as an independent contractor,
               ------------------                                              
shall service and administer (or cause a Subservicer to service and administer)
the Trust Assets in accordance with and as described in this Agreement, the
Indenture, the Operating and Management Agreement, the Construction Phase
Agreement, the Security Documents and the Revenue Agreements and shall have full
power and authority, acting alone, to do any and all things in connection with
such servicing and administration which the Servicer may deem necessary or
desirable and consistent with the terms of this Agreement, the Indenture, the
Operating and Management Agreement, the Construction Phase Agreement, the
Security Documents and the Revenue Agreements and the ordinary servicing and
administrative practices of prudent institutions administering assets similar to
the Trust Assets.  Notwithstanding anything to the contrary contained herein,
the Servicer, in servicing and administering the Trust Assets, shall employ or
cause to be employed procedures (including collection, foreclosure, liquidation
and management and liquidation procedures) and exercise the same care that it
customarily employs and exercises in servicing and administering assets of 

                                      F-13
<PAGE>
 
the same type as the Trust Assets for its own account, all in accordance with
Accepted Servicing Procedures of prudent owners and servicers of assets of the
same type as the Trust Assets and giving due consideration to the Noteholders'
reliance on the Servicer. The Servicer has and shall maintain the facilities,
procedures and experienced personnel necessary to comply with the servicing
standard set forth in this subsection (a) and the duties of the Servicer set
forth in this Agreement and the Indenture relating to the servicing and
administration of the Trust Assets. In performing its obligations hereunder and
under the Indenture and the Operating and Management Agreement, the Servicer
shall at all times act in good faith in a commercially reasonable manner in
accordance with applicable law and the Contracts.

          Notwithstanding any provision to the contrary herein, neither the
Servicer nor any Subservicer on behalf of the Servicer shall have any obligation
to advance its own funds for any delinquent payments under any Revenue
Agreement.

          (b)  Enforcement, Waivers, Modifications and Extensions.  The Servicer
               --------------------------------------------------               
shall make reasonably diligent efforts to collect all payments called for under
the terms and provisions of the Contracts, enforce the Obligors' obligations
under their respective Contracts, manage the New Arena Facility in accordance
with the Revenue Agreements, and administer the Operating and Management
Agreement and the Revenue Agreement Rights and shall, to the extent such
procedures shall be consistent with this Agreement, the Operating and Management
Agreement and the Indenture, follow Accepted Servicing Procedures.  On behalf of
the Noteholders, the Servicer shall use all reasonable efforts, consistent with
Accepted Servicing Procedures, to enforce, and maintain rights in respect of,
the Contracts.  The Servicer may in its discretion extend the Due Date with
respect to any Required Payment for a period (with respect to each payment as to
which the Due Date is extended) not greater than 30 days after the initially
scheduled due date for such Required Payment (including within such maximum 30
day grace period, any grace periods set forth in any Revenue Agreement).

          The Servicer shall have the right, on behalf of and in the name of the
Issuer Trust, to amend, modify or restate any of the Revenue Agreements;
provided, however, that if in the reasonable judgment of the Servicer, such
amendment, modification or restatement (i) could reasonably be expected to
materially impair the operation of the New Arena Facility, or (ii) is likely to
cause any Revenue Contractor to be entitled to reduce, interrupt or terminate
its payment obligations under its Revenue Agreement (as such payment obligations
are set forth in each such Revenue Agreement sold to the Issuer Trust and
delivered to the Indenture Trustee on the Closing Date), the Servicer shall
obtain the express prior written consent thereto of the Issuer Trust and the
Indenture Trustee. Immediately following delivery of the Revenue Agreements by
the Servicer, on behalf of the Issuer Trust, to the Indenture Trustee or its
representative, on the Closing Date, the Servicer shall execute amended and
restated Revenue Agreements for each of Pepsi and Coors in such manner as to
conform them to the form previously reviewed and approved by the transaction
counsel prior to the Closing Date.

          (c)  The Servicer shall service and administer the Trust Assets in
accordance with applicable state and federal law and shall provide to the
Obligors any reports required to be provided to them thereby.

                                      F-14
<PAGE>
 
          The Servicer shall cause to be performed any and all acts required to
be performed by the Servicer to preserve the rights and remedies of the Issuer
Trust and the Indenture Trustee in any Insurance Policies applicable to the
Trust Assets or the New Arena Facility including, without limitation, in each
case, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of co-insured, joint loss payee and
mortgagee rights in favor of the Issuer Trust and the Indenture Trustee.

          The Servicer agrees that, so long as it shall continue to serve in the
capacity contemplated under the terms of this Agreement, it shall remain in good
standing under the laws governing its creation and existence and qualified under
the laws of each state in which it is necessary to perform its obligations under
this Agreement or in which the nature of its business requires such
qualification; it shall maintain all licenses, permits and other approvals
required by any law or regulations as may be necessary to perform its
obligations under this Agreement and to retain all rights to service and
administer the Trust Assets; and it shall not dissolve or otherwise dispose of
all or substantially all of its assets.

          The Issuer Trust shall execute, at the written direction of the
Servicer, any limited or special powers of attorney and other documents to
enable the Servicer or any Subservicer to carry out their servicing and
administrative duties hereunder, and the Issuer Trust shall not be accountable
for the actions of the Servicer or any Subservicers under such powers of
attorney and shall be indemnified by such parties with respect to such actions.
The Servicer shall delegate its duties with respect to the Contracts, as set
forth in Section 4.01(a), Section 4.01(b), and in this Section 4.01(c) to the
         ---------------  ---------------              ---------------       
Operator under the Operating and Management Agreement.

          Section 4.02  Maintenance of Filings.
                        ----------------------   

          The Servicer shall take such steps as are reasonably necessary to
maintain the perfection of the Issuer Trust's security interest in the Excess
Collateral and the Indenture Trustee's security interests in the Collateral,
including the filing of financing statements.  Each of the Indenture Trustee,
the Transferor, and the Issuer Trust agree to cooperate with the Servicer in
preparing, executing and filing such statements.  The filing of any such
statement with respect to the Transferor and the Issuer Trust shall not be
construed as any indication of an intent of any party contrary to the expressed
intent set forth in Section 2.03 hereof.  If the Servicer fails to file any such
                    ------------                                                
financing statements or continuation statements at least one month prior to the
expiration thereof, the Servicer does hereby make, constitute and appoint the
Indenture Trustee its attorney-in-fact, with full power and authority, to
execute and file in its name and on its behalf any such financing statements or
continuation statements required under this Section 4.02.
                                            ------------ 

          Section 4.03  Subsequent Revenue Agreements.
                        -----------------------------   

          In the event that any Revenue Agreement is terminated, the Servicer
shall, on behalf of the Issuer Trust, the Indenture Trustee and the Noteholders,
use reasonable efforts to promptly negotiate, execute and deliver a Subsequent
Revenue Agreement with the Revenue Contractor or a successor obligor relating to
the underlying Revenue Agreement Rights of the 

                                      F-15
<PAGE>
 
terminated Revenue Agreement. In finding a replacement Obligor and negotiating a
Subsequent Revenue Agreement, the Servicer shall, to the extent consistent with
Accepted Servicing Procedures, attempt to enter into a Revenue Agreement which
is no less favorable to the Issuer Trust than the terms and provisions of the
terminated Revenue Agreement, giving due consideration to the maximization, on a
present value basis, of revenues under such Subsequent Revenue Agreement, and
the credit of the successor Obligor. The Issuer Trust shall execute, at the
written direction of the Servicer, any limited or special powers of attorney and
other documents to enable the Servicer or any Subservicer to carry out their
duties pursuant to this Section 4.03, and the Owner Trustee shall not be
                        ------------ 
accountable for the actions of the Servicer or any Subservicers under such
powers of attorney and shall be indemnified by such parties with respect to such
actions. The Servicer shall promptly deliver an originally executed version of
any Subsequent Revenue Agreement, and any related documentation and agreements,
to the Indenture Trustee, or upon the direction of the Indenture Trustee, to the
Custodian, and such Subsequent Revenue Agreement and related documentation shall
become part of the Trust Estate and the Indenture Trustee's Contract Files and a
copy of such Subsequent Revenue Agreement shall be held by the Servicer as part
of the Servicer's Contract Files. Prior notice of the execution and delivery of
any Subsequent Revenue Agreement shall be delivered by the Servicer to the
Rating Agency. The Servicer shall take such steps as are reasonably necessary to
ensure the perfection and priority of the Indenture Trustee's and the
Noteholders' security interests in any Subsequent Revenue Agreements, including,
without limitation, the filing of financing statements, and the Indenture
Trustee and the Issuer Trust shall cooperate with the Servicer in ensuring any
such perfection and priority of interests.

          Section 4.04  Subservicing.
                        ------------   

          (a)  The Servicer is entering into the Operating and Management
Agreement with the Operator and may enter into other Subservicing Agreements for
any additional servicing and administration of any of the Trust Assets with any
institution that is an Eligible Servicer and in compliance with the laws of each
state necessary to enable it to perform its obligations under such Subservicing
Agreement.  The Servicer shall give written notice to the Issuer Trust and the
Indenture Trustee of the appointment of any other Subservicer.  So long as no
Event of Default or Servicer Event of Default has occurred and is continuing,
the Servicer shall be entitled to terminate any Subservicing Agreement in
accordance with terms and conditions of such Subservicing Agreement and to
either service the related Trust Assets directly or enter into a Subservicing
Agreement with a successor subservicer which qualifies hereunder.

          In the event of termination of any Subservicer, and unless a successor
Subservicer has otherwise been appointed, all servicing obligations of such
Subservicer shall be assumed simultaneously by the Servicer without any
additional act or deed on the part of such Subservicer or the Servicer, and the
Servicer shall service directly the related Trust Assets.

          Each Subservicing Agreement shall include the provision that such
agreement may be immediately terminated by the Indenture Trustee in the event
that the Servicer shall, 

                                      F-16
<PAGE>
 
for any reason, no longer be the Servicer. In no event shall any Subservicing
Agreement require the Indenture Trustee, as successor Servicer, for any reason
whatsoever to pay compensation to a Subservicer in order to terminate such
Subservicer.

          (b)  Notwithstanding any Subservicing Agreement, any of the provisions
of this Agreement relating to agreements or arrangements between the Servicer
and a Subservicer or reference to actions taken through a Subservicer or
otherwise, the Servicer shall remain obligated and primarily liable to the
Issuer Trust, the Indenture Trustee and the Noteholders for the servicing and
administration of the Trust Assets in accordance with the provisions of this
Agreement without diminution of such obligation or liability by virtue of such
Subservicing Agreements or arrangements or by virtue of indemnification from the
Subservicer and to the same extent and under the same terms and conditions as if
the Servicer alone were servicing and administering the Trust Assets.  For
purposes of this Agreement, the Servicer shall be deemed to have received
payments on Trust Assets when the Subservicer has actually received such
payments and, unless the context otherwise requires, references in this
Agreement to actions taken or to be taken by the Servicer in servicing the Trust
Assets include actions taken or to be taken by the Operator or any other
Subservicer on behalf of the Servicer.  The Servicer shall be entitled to enter
into any agreement with a Subservicer for indemnification of the Servicer by
such Subservicer, and nothing contained in this Agreement shall be deemed to
limit or modify such indemnification.

          (c)  In the event the Servicer shall for any reason no longer be the
Servicer (including by reason of an Event of Default or a Servicer Event of
Default), the successor Servicer, on  behalf of the Issuer Trust, the Indenture
Trustee  and the Noteholders pursuant to Section 4.05 hereof, shall thereupon
                                         ------------                        
assume all of the rights and obligations of the Servicer under each Subservicing
Agreement that the Servicer may have entered into, unless the successor Servicer
elects to terminate any Subservicing Agreement in accordance with its terms.
The successor Servicer shall be deemed to have assumed all of the Servicer's
interest therein and to have replaced the Servicer as a party to each
Subservicing Agreement to the same extent as if the Subservicing Agreements had
been assigned to the assuming party, except that the Servicer shall not thereby
be relieved of any liability or obligations under the Subservicing Agreements
which accrued prior to the transfer of servicing to the successor Servicer.  The
Servicer, at its expense and without right of reimbursement therefor, shall,
upon request of the successor Servicer, deliver to the assuming party all
documents and records relating to each Subservicing Agreement and the Trust
Assets then being serviced and an accounting of amounts collected and held by it
and otherwise use its best efforts to effect the orderly and efficient transfer
of the Subservicing Agreements to the assuming party.

          (d)  As part of its servicing activities hereunder, the Servicer, for
the benefit of the Issuer Trust, the Indenture Trustee and the Noteholders,
shall  enforce the obligations of each Subservicer under the related
Subservicing Agreement.  Such enforcement, including, without limitation, the
legal prosecution of claims and the pursuit of other appropriate remedies, shall
be in such form and carried out to such an extent and at such time as the
Servicer, in its good faith business judgment, would require were it the owner
of the related Trust Assets.  The Servicer shall pay the costs of such
enforcement at its own expense and 

                                      F-17
<PAGE>
 
shall be reimbursed therefor only (i) from a general recovery resulting from
such enforcement to the extent, if any, that such recovery exceeds all amounts
due in respect of the related Trust Asset or (ii) from a specific recovery of
costs, expenses or attorneys' fees against the party against which such
enforcement is directed.

          (e)  Any Subservicing Agreement that may be entered into and any other
transactions or services relating to the Trust Assets involving a Subservicer
shall be deemed to be between the Subservicer and the Servicer alone and none of
the Issuer Trust, the Indenture Trustee or the Noteholders shall be deemed
parties thereto or shall have any claims, rights, obligations, duties or
liabilities with respect to the Subservicer in its capacity as such except as
set forth in subsection (c) of this Section 4.04.
                                    ------------ 

          Section 4.05  Successor Servicers.
                        -------------------   

          In the event that the Servicer is terminated pursuant to Section 9.01
                                                                   ------------
hereof, or resigns pursuant to Section 8.04 hereof or otherwise becomes unable
                               ------------                                   
to perform its obligations under this Agreement, the Indenture Trustee will
appoint a successor servicer in accordance with the provisions of Section 9.02
                                                                  ------------
hereof; provided, however, that any successor servicer shall satisfy the
requirements of an Eligible Servicer and shall be approved by the Rating Agency
(upon receipt by the Rating Agency of thirty (30) days written notice thereof).

          Section 4.06  144A Information.
                        ----------------   

          The Servicer shall provide to the Indenture Trustee, if requested,
information regarding the Notes and the Trust Assets and such other information
as the Indenture Trustee shall be required to deliver to any Noteholder and any
prospective transferee designated by any such Noteholder to satisfy the
condition of eligibility set forth in Rule 144A(d)(4) under the Securities Act.

          Section 4.07  Administrative Duties of Servicer
                        ---------------------------------

          (a)  Duties with Respect to the Basic Documents.  The Servicer shall
               ------------------------------------------                     
consult with the Owner Trustee as the Servicer deems appropriate regarding the
duties of the Issuer Trust under the Basic Documents.  The Servicer shall
monitor the performance of the Issuer Trust and shall advise the Owner Trustee
when action is necessary to comply with the Issuer Trust's duties under the
Basic Documents. The Servicer shall prepare for execution by the Issuer Trust or
shall cause the preparation by other appropriate Persons of all such documents,
reports, filings, instruments, certificates and opinions as it shall be the duty
of the Issuer Trust to prepare, file or deliver pursuant to the Basic Documents.
In furtherance of the foregoing, the Servicer shall take all necessary action
that is the duty of the Issuer Trust to take pursuant to the Indenture,
including, without limitation, any applicable provisions of the Indenture.

          (b)  Duties with Respect to the Issuer Trust
               ---------------------------------------

               (i)   In addition to the duties of the Servicer set forth in this
Agreement or any of the Basic Documents, the Servicer shall perform such
calculations and 

                                      F-18
<PAGE>
 
shall prepare for execution by the Issuer Trust or the Owner Trustee or shall
cause the preparation by other appropriate Persons of all such documents,
reports, filings, instruments, certificates and opinions as it shall be the duty
of the Issuer Trust or the Owner Trustee to prepare, file or deliver pursuant to
state and federal tax and securities laws. In accordance with the directions of
the Issuer Trust or the Owner Trustee, the Servicer shall administer, perform or
supervise the performance of such other activities in connection with the Issuer
Trust as are not covered by any of the foregoing provisions and as are expressly
requested by the Issuer Trust or the Owner Trustee and are reasonably within the
capacity of the Servicer.

               (ii)  Notwithstanding anything in this Agreement or any of the
Basic Documents to the contrary, the Servicer shall be responsible for promptly
notifying the Owner Trustee and the Paying Agent in the event that any
withholding tax is imposed on the Issuer Trust's payments (or allocations of
income) to a Certificateholder. Any such notice shall be in writing and specify
the amount of any withholding tax required to be withheld by the Owner Trustee
or the Paying Agent pursuant to such provision.

          (c)  Tax Matters.  The Servicer shall prepare and file, on behalf of
               -----------                                                    
the Issuer Trust, all tax returns, tax elections, financial statements and such
annual or other reports of the Issuer Trust as are necessary for the preparation
of tax reports as provided in Article V of the Trust Agreement and Section 7.09
                                                                   ------------
hereof.  All tax returns will be executed as provided in Article V of the Trust
Agreement and Section 7.09 hereof.
              ------------        

          (d)  Records. The Servicer shall maintain appropriate books of account
               -------  
and records relating to Servicer performance under this Agreement, which books
of account and records shall be accessible for inspection by the Owner Trustee
at any time during normal business hours and upon reasonable advance notice.

          (e)  Additional Information to be Furnished to the Issuer Trust.  The
               ----------------------------------------------------------      
Servicer shall furnish to the Owner Trustee from time to time such additional
information regarding the Issuer Trust or the Basic Documents as the Owner
Trustee shall reasonably request.

                                   ARTICLE V

                        ESTABLISHMENT OF TRUST ACCOUNTS
                        -------------------------------

          Section 5.01  Collection Account.
                        ------------------   

          (a)  Establishment of Collection Account.  As of the Closing Date, the
               -----------------------------------                              
Servicer, for the benefit of the Securityholders, shall cause to be established
and maintained a Collection Account (the "Collection Account"), which shall be a
                                          ------------------                    
separate Eligible Account, entitled "Collection Account, The Bank of New York,
as Indenture Trustee, in trust for the Denver Arena Trust Arena Revenue Backed
Notes." The Collection Account shall be maintained with any depository
institution which satisfies the requirements set forth in the definition of
Eligible Account. The creation of any Collection Account shall be evidenced by a

                                      F-19
<PAGE>
 
letter agreement between the Servicer and such depository institution. Funds in
the Collection Account shall be invested in accordance with Section 5.04 hereof.
                                                            ------------

          (b)  (1)   Deposits to Collection Account. The Indenture Trustee shall
                     ------------------------------   
withdraw from the Lockbox Account and deposit into the Collection Account on a
daily basis, and to the extent received by the Servicer, the Servicer shall
deposit or cause to be deposited, within two (2) Business Days after receipt
thereof, into the Collection Account, in each case to be retained therein in
trust for the benefit of the Securityholders:

               (i)   all payments received on account of Revenue Agreements;

               (ii)  all Insurance Proceeds, Condemnation Proceeds, liquidated
damage payments, payments from performance and payment bonds, indemnity payments
and the proceeds of any action to liquidate any portion of the Collateral;

               (iii) the Mandatory Redemption Price or the Optional Redemption
Price paid pursuant to the Indenture;

               (iv)  funds on deposit in the Capitalized Interest Account, Debt
Service Reserve Account, Debt Service Coverage Account, Construction Fund
Account and Lease Reserve Account that are required to be transferred to the
Collection Account as described herein; and

               (v)   interest and gains on funds held in the Collection Account.

          The Servicer shall be entitled to retain and not deposit into the
Collection Account any amounts received by it with respect to a Trust Asset that
constitute additional servicing compensation pursuant to Section 7.03 hereof,
                                                         ------------        
and such amounts retained by the Servicer shall be excluded from the
calculation of the Servicing Compensation that is distributable to the Servicer
from the Collection Account on the next Distribution Date.

          The Indenture Trustee shall make other deposits into the Collection
Account as required pursuant to Section 5.03.
                                ------------ 

               (2)   Withdrawals from Collection Account.
                     ---------------------------------- 

          The Indenture Trustee, at the written direction of the Servicer, shall
make the following withdrawals from the Collection Account:

               (i)   to withdraw any amount not required to be deposited in the
Collection Account or deposited therein in error;

               (ii)  to withdraw the $5,000,000 initial payment under the US
West Agreement and deposit such amount in the Construction Fund Account;

               (iii) to make the payments set forth in Section 8.01(e) hereof;
                                                       ---------------        

                                      F-20
<PAGE>
 
               (iv)   to distribute the Mandatory Redemption Price or Optional
Redemption Price to Noteholders on the Redemption Date; and

               (v)    to clear and terminate the Collection Account in
connection with the termination of this Agreement.

          (c)  Distributions from Collection Account. On each Distribution Date,
               -------------------------------------  
the Indenture Trustee (based on the information provided by the Servicer
contained in the Servicer's Remittance Report for such Distribution Date) shall
distribute the Available Collection Amount from the Collection Account by 9:00
a.m. (New York City time) for application in the following order of priority:

               (i)    (A) to the Servicer, an amount equal to the Servicing
Compensation (net of any amounts retained prior to deposit into the Collection
Account pursuant to subsection (b)(1) above) and all unpaid Servicing
Compensation from prior Distribution Dates, (B) to the Indenture Trustee, an
amount equal to the Indenture Trustee Fee and all unpaid Indenture Trustee Fees
from prior Distribution Dates, (C) to the Owner Trustee, an amount equal to the
Owner Trustee Fee and all unpaid Owner Trustee Fees from prior Distribution
Dates, and (D) to the Custodian, an amount equal to the Custodian Fee, if any,
and all unpaid Custodian Fees from prior Distribution Dates; and

               (ii)   to the City, any amounts due and unpaid (after the
expiration of any applicable cure periods) pursuant to the Lease between the
City and the Transferor to the extent funds on deposit in the Lease Reserve
Account are insufficient to make such payment;

               (iii)  to the Paying Account, up to an amount equal to the
Noteholders' Interest Distribution Amount for such Distribution Date;

               (iv)   to the Debt Service Reserve Account to the extent the
amount on deposit therein on such Distribution Date is less than the Required
Debt Service Reserve Amount, an amount equal to such shortfall;

               (v)    if such Distribution Date is in the month of November, to
the Paying Account, up to an amount equal to the Targeted Principal Distribution
Amount for such Distribution Date until the Principal Balance of each Note is
reduced to zero;

               (vi)   to the Debt Service Coverage Account, the Debt Service
Coverage Amount for such Distribution Date;

               (vii)  if a Lease Reserve Trigger Event shall have occurred, to
the Lease Reserve Account, to the extent the amount on deposit therein on such
Distribution Date is less than the Lease Reserve Amount, an amount equal to such
shortfall;

               (viii) to the Indenture Trustee, the Issuer Trust and the
Servicer, as applicable, to reimburse for expenditures made or incurred in
connection with the exercise of rights or remedies under the Basic Documents;
and

                                      F-21
<PAGE>
 
               (ix)   if no Event of Default has occurred and is continuing, the
remaining amount to the Certificate Paying Agent for distribution to the
Certificateholders.

          (d)  Release of Excess Cash.  On each Monthly Distribution Date (but
               ----------------------                                         
not on the Distribution Date in May and November), the Indenture Trustee shall,
based on information provided by the Servicer on the immediately prior
Determination Date, withdraw from the Collection Account the amount of funds
therein in excess of the amount required to make the distributions pursuant to
Sections 5.01(c)(i), (ii) (iii) and (v) on the Distribution Date occurring in
-------------------------------     ---                                      
the next following November, and distribute such funds as follows:

               (i)    to the Debt Service Reserve Account to the extent the
          amount on deposit therein on the Determination Date related to such
          Monthly Distribution Date is less than the Required Debt Service
          Reserve Amount determined as of the immediately prior Distribution
          Date;

               (ii)   to the Debt Service Coverage Account to the extent the
          amount on deposit therein on the Determination Date related to such
          Monthly Distribution Date is less than the Debt Service Coverage
          Amount determined on such related Determination Date;

               (iii)  if a Lease Reserve Trigger Event shall have occurred, to
          the Lease Reserve Account to the extent the amount on deposit therein
          on the Determination Date related to such Monthly Distribution Date is
          less than the Lease Reserve Amount;

               (iv)   to the Indenture Trustee, the Issuer Trust and the
          Servicer, as applicable, to reimburse for expenditures made or
          incurred in connection with the exercise of rights or remedies under
          the Basic Documents; and

               (v)    if no Event of Default has occurred and is continuing, the
          remaining amount to the Certificate Paying Agent for distribution to
          the Certificateholders.

          (e)  Certain Principal Distributions.  Amounts deposited in the
               -------------------------------                           
Collection Account in respect of Insurance Proceeds, Condemnation Proceeds,
liquidated damage payments, payments from performance and payment bonds,
indemnity payments and the proceeds of any action to liquidate any portion of
the Collateral which are not applied or to be applied to a mandatory redemption
of the Notes pursuant to Section 10.01 of the Indenture, shall be distributed to
the Noteholders, pro rata, on the Distribution Date next following the date
which is fifteen (15) days after the receipt thereof, as a payment of principal
of the Notes.  In the event any such distribution is made to the Noteholders
pursuant to this Section 5.01(e), the Servicer shall prepare and send to the
                 --------------                                             
Indenture Trustee, and the Indenture Trustee shall send to all Securityholders
and the Rating Agency, a revised Targeted Principal Payment Schedule which shall
amend the remaining Targeted Principal Distribution Amounts on such schedule by
reducing each such remaining Targeted Principal Distribution Amount pro rata

                                      F-22
<PAGE>
 
based on the amount thereof so that the total of all remaining Targeted
Principal Payments are reduced by the amount of such distribution.

          Section 5.02  Distributions to Certificateholders and Noteholders.
                        ---------------------------------------------------   

          (a)  Distributions to Certificateholders.  On each Distribution Date,
               -----------------------------------                             
the Indenture Trustee shall distribute to the Certificate Paying Agent amounts
required in accordance with Section 5.01(c)(ix) hereof for distribution to the
                            -------------------                               
Certificateholders. On each Monthly Distribution Date, the Indenture Trustee
shall distribute to the Certificate Paying Agent amounts required in accordance
with Section 5.01(d)(v) hereof for distribution to the Certificateholders.  All
     ------------------                                                        
distributions made on the Trust Certificates on each Distribution Date will be
made pro rata among the Certificateholders of record on the next preceding
Monthly Distribution Date based on their Percentage Interest, without preference
or priority of any kind, and, except as otherwise provided in the next
succeeding sentence, shall be made by wire transfer of immediately available
funds to the account of each such Certificateholder, if such Certificateholder
shall own of record a Trust Certificate in Percentage Interest of at least a 10%
and shall have so notified the Indenture Trustee, and otherwise by check mailed
to the address of such Certificateholder appearing in the Certificate Register.
The final distribution on each Trust Certificate will be made in like manner,
but only upon presentment and surrender of such Trust Certificate at the
location specified in the notice to Certificateholders of such final
distribution. Any amount so distributed to the Certificateholders shall not be
subject to any claim or interest of the Noteholders.

          (b)  Distributions to Noteholders.  All distributions made on the 
               ----------------------------     
Notes on each Distribution Date will be made on a pro rata basis among the
Noteholders of record on the next preceding Record Date based on the Principal
Balance represented by their respective Notes, without preference or priority of
any kind, and, except as otherwise provided in the next succeeding sentence,
shall be made by wire transfer of immediately available funds to the account of
each such Noteholder, if each such Noteholder shall own of record Notes in
original Denominations aggregating at least $1,000,000 and shall have so
notified the Indenture Trustee at least fifteen (15) days prior to the relevant
payment date, and otherwise by check mailed to the address of each such
Noteholder appearing in the Note Register. The final distribution on each Note
will be made in like manner, but only upon presentment and surrender of such
Note at the location specified in the notice to Noteholders of such final
distribution.

          Section 5.03  Debt Service Coverage Account, Debt Service Reserve
                        ---------------------------------------------------
Account, Capitalized Interest Account, Construction Fund Account, Lease Reserve
-------------------------------------------------------------------------------
Account and Paying Account.
-------------------------- 

          (a)  Establishment and Administration of Debt Service Coverage 
               ---------------------------------------------------------
Account.
-------

               (i)    No later than the Closing Date, the Servicer, for the
benefit of the Noteholders, shall cause to be established and maintained a Debt
Service Coverage Account, which shall be a separate Eligible Account, entitled
"Debt Service Coverage Account, The Bank of New York, as Indenture Trustee, in
trust for the Denver Arena Trust Arena Revenue 

                                      F-23
<PAGE>
 
Backed Notes." Funds in the Debt Service Coverage Account shall be invested in
accordance with Section 5.04 hereof.
                ------------

               (ii)   With respect to the Distribution Date occurring in the
month of November in each year commencing November 1999, the Indenture Trustee
shall deposit into the Debt Service Coverage Account pursuant to Section
                                                                 -------
5.01(c)(vi) and retain therein in trust for the benefit of the Noteholders, an
-----------
amount equal to the shortfall, if any, between (i) the Projected Revenue, as
defined below, for the period from such Distribution Date to the Distribution
Date occurring in the following November and (ii) the amount of revenue required
to provide a minimum Debt Service Coverage Ratio of 125%. Such deposit shall be
made only to the extent of the Available Collection Amount on such Distribution
Date after distribution of the amounts described in clauses (i) through (v) in
Section 5.01(c) above.  Amounts on deposit in the Debt Service Coverage Account 
---------------
shall be transferred to the Collection Account on the Distribution Date
occurring in the following November. The Projected Revenue shall equal all
revenue under the Revenue Agreements contractually obligated to be paid for the
period from the date of determination of Projected Revenues to the following
November Distribution Date, except for payments due in respect of Luxury Suite
License Agreements that expire within such period that had not been renewed, in
which case the Projected Revenue for such period for each such expiring Luxury
Suite License Agreement shall be assumed to be equal to 75% of the total amount
of payments contractually obligated to be paid during such period. With respect
to Luxury Suite License Agreements that had terminated prior to the date of
determination and that have not been renewed or replaced or that were 90 days or
more delinquent on such date, the Projected Revenue shall be equal to zero. On
each monthly Determination Date, the Servicer shall determine the Debt Service
Coverage Amount for the one year period commencing on the prior November
Distribution Date. The Debt Service Coverage Amount shall equal the shortfall,
if any, between (A) the sum of revenue collected since the prior November
Distribution Date plus Projected Revenue (as defined below) for the period up to
the following November Distribution Date and (B) the amount of revenue required
to provide a minimum Debt Service Ratio of 125% for such one year period. The
Debt Service Coverage Amount shall reflect the actual level of the renewals of
expiring Luxury Suite License Agreements and shall be recalculated on each
Determination Date. Any funds on deposit in the Debt Service Coverage Account in
excess of the Debt Service Coverage Amount, after giving effect to such monthly
recalculation, shall be released to the Certificate Paying Agent for
distribution to the Certificateholders on the Monthly Distribution Date and on
the Distribution Date in May of each year so long as no Event of Default has
occurred and is continuing on such date. On the earlier of (A) the Rated Final
Maturity Date or (B) the Distribution Date, the Mandatory Redemption Date or the
Optional Redemption Date on which the Outstanding Amount shall be reduced to
zero, the Indenture Trustee shall transfer all funds remaining on deposit in the
Debt Service Coverage Account to the Collection Account.

          (b)  Establishment and Administration of Debt Service Reserve Account.
               ---------------------------------------------------------------- 

               (i)   No later than the Closing Date, the Servicer, for the
benefit of the Noteholders, shall cause to be established and maintained a Debt
Service Reserve Account, which shall be a separate Eligible Account, entitled
"Debt Service Reserve Account, The Bank 

                                      F-24
<PAGE>
 
of New York, as Indenture Trustee, in trust for the Denver Arena Trust Arena
Revenue Backed Notes." Funds in the Debt Service Reserve Account shall be
invested in accordance with Section 5.04 hereof.
                            ------------

               (ii)   On the Closing Date, the Transferor shall deposit or cause
to be deposited into the Debt Service Reserve Account and retain therein in
trust for the benefit of the Noteholders, the Required Debt Service Reserve
Amount. The Required Debt Service Amount on the Closing Date and on each
Distribution Date shall be the amount equal to the interest that will accrue on
the Outstanding Amount of the Notes (determined after giving effect to the
distributions to be made on such Distribution Date) over a one year period at
the Note Interest Rate. On each Distribution Date, the Indenture Trustee shall
deposit or caused to be deposited into the Debt Service Reserve Account the
amount required by Section 5.01(c)(iv).
                   ------------------- 

               (iii)  With respect to the Distribution Date occurring in the
month of May in each year (commencing May 2000), the Indenture Trustee shall,
not later than 5:00 p.m. on the Business Day immediately preceding such
Distribution Date, withdraw from funds in the Debt Service Reserve Account and
deposit to the Collection Account an amount equal to the excess, if any, of the
amount required to make the payments required on such Distribution Date pursuant
to Sections 5.01(c)(i), (ii) and (iii) over the amount on deposit in the
   -----------------------------------  
Collection Account. In addition, at such time, the Indenture Trustee shall
transfer from the Debt Service Reserve Account to the Collection Account any
amount remaining on deposit in the Debt Service Reserve Account which exceeds
the Required Debt Service Reserve Amount for such Distribution Date. On the
earlier of (A) the Rated Final Maturity Date or (B) the Distribution Date, the
Mandatory Redemption Date or the Optional Redemption Date on which the
Outstanding Amount shall be reduced to zero, the Indenture Trustee shall
transfer all funds remaining on deposit in the Debt Service Reserve Account to
the Collection Account.

          (c)  Establishment and Administration of Capitalized Interest Account.
               ---------------------------------------------------------------- 

               (i)    No later than the Closing Date, the Servicer, for the
benefit of the Noteholders, shall cause to be established and maintained a
Capitalized Interest Account, which shall be a separate Eligible Account,
entitled "Capitalized Interest Account, The Bank of New York, as Indenture
Trustee, in trust for the Denver Arena Trust Arena Revenue Backed Notes." Funds
in the Capitalized Interest Account shall be invested in accordance with Section
                                                                         -------
5.03(c)(ii) and Section 5.04 hereof.
-----------     ------------        

               (ii)   On the Closing Date, the Transferor shall deposit or cause
to be deposited into the Capitalized Interest Account and retain therein in
trust for the benefit of the Noteholders, the Capitalized Interest Amount. The
Capitalized Interest Amount (which shall not be a negative amount) is equal to
(A) the distributions to be made pursuant to Sections 5.01(c)(i) and (iii)
                                             ----------------------------- 
during the period commencing on the Closing Date and ending on the Distribution
Date occurring in November 1999 at the Note Interest Rate on the Original
Principal Balance of the Notes minus (B) the income to be received on the
Permitted Investments specified by the Transferor on the Closing Date in which
such deposit is invested.  

                                      F-25
<PAGE>
 
Funds deposited in the Capitalized Interest Account shall be invested by the
Indenture Trustee on the Closing Date, as so directed by the Transferor.

               (iii)  With respect to each Distribution Date up to and including
the Distribution Date occurring in November 1999, the Indenture Trustee shall,
not later than 5:00 p.m. on the Business Day immediately preceding such
Distribution Date, withdraw the amount necessary to make the payments required
under Sections 5.01(c)(i) and (iii) from the Capitalized Interest Account and
      -----------------------------
deposit the same into the Collection Account. On the Distribution Date occurring
in November 1999, any funds remaining in the Capitalized Interest Account after
the withdrawal of the amount required to pay the Trust Fees and Expenses and
Noteholders' Interest Distribution Amount for such Distribution Date shall be
transferred to the Collection Account and the Capitalized Interest Account shall
be closed.

          (d)  Establishment and Administration of Construction Fund Account.
               ------------------------------------------------------------- 

               (i)    No later than the Closing Date, the Servicer, for the
benefit of the Noteholders, shall cause to be established and maintained a
Construction Fund Account, which shall be a separate Eligible Account, entitled
"Construction Fund Account, The Bank of New York, as Indenture Trustee, in trust
for the Denver Arena Trust Arena Revenue Backed Notes." Funds in the
Construction Fund Account shall be invested in accordance with Section 5.04
                                                               ------------ 
hereof.

               (ii)   On the Closing Date, the Transferor shall deposit or cause
to be deposited $139,835,000 into the Construction Fund Account. The funds in
the Construction Fund Account shall be disbursed by the Indenture Trustee on a
monthly basis upon its receipt of a notice from the Issuer Trust and the
Construction Consultant stating that the conditions for disbursement set forth
in the Construction Phase Agreement have been satisfied and indicating the
amount to be disbursed and the recipients thereof.  All funds, if any, remaining
in the Construction Fund Account upon completion of construction of the New
Arena Facility and the payment of the Construction Contractor in connection
therewith, shall be transferred to the Collection Account.

          (e)  Establishment and Administration of Lease Reserve Account.
               --------------------------------------------------------- 

               (i)    No later than the Closing Date, the Servicer, for the
benefit of the Noteholders, shall cause to be established and maintained an
account (the "Lease Reserve Account"), which shall be a separate Eligible
              ----------------------     
Account, entitled "Lease Reserve Account, The Bank of New York, as Indenture
Trustee, in trust for the Denver Arena Trust Arena Revenue Backed Notes." Funds
in the Lease Reserve Account shall be invested in accordance with Section 5.04
                                                                  ------------
hereof.

               (ii)   If on any Distribution Date, any funds in the Collection
Account are distributed pursuant to Section 5.01(c)(ii) above (a "Lease Reserve
                                    -------------------           -------------
Trigger Event"), the Indenture Trustee shall withdraw from the Collection
-------------
Account and deposit into the Lease Reserve Account an amount equal to three
times the aggregate annual payment due under the Lease for the one year period
prior to such Distribution Date (the "Lease Reserve Amount"). 
                                      --------------------   

                                      F-26
<PAGE>
 
Such withdrawal from the Collection Account shall be made only to the extent of
the Available Collection Amount on such Distribution Date after payment of the
amounts described in Section 5.01(c)(i) through (vi) above. To the extent the
                     -------------------------------    
amount on deposit in the Lease Reserve Account on any Distribution Date after a
Lease Reserve Trigger Event is less than the Lease Reserve Amount, deposits to
the Lease Reserve Account shall be made by the Indenture Trustee as set forth in
the preceding sentence. Amounts on deposit in the Lease Reserve Account shall be
used solely to make the payments, if any, required to be made pursuant to
Section 5.01(c)(ii) above. On the earlier of (A) the Rated Final Maturity Date 
-------------------
or (B) the Distribution Date, the Mandatory Redemption Date or the Optional
Redemption Date on which the Outstanding Amount shall be reduced to zero, the
Indenture Trustee shall transfer all funds remaining on deposit in the Lease
Reserve Account to the Collection Account.

          (f)  Establishment and Administration of Paying Account.
               -------------------------------------------------- 

               (i)   No later than the Closing Date, the Servicer, for the
benefit of the Noteholders, shall cause to be established and maintained an
account (the "Paying Account"), which shall be a separate Eligible Account,
              --------------     
entitled "Paying Account, The Bank of New York, as Indenture Trustee, in trust
for the Denver Arena Trust Arena Revenue Backed Notes." Funds in the Paying
Account shall be invested in accordance with Section 5.04 hereof.
                                             ------------        

               (ii)  On each Distribution Date, the Indenture Trustee shall
withdraw from the Collection Account and deposit into the Paying Account the
amount to be distributed to Noteholders in respect of the Noteholders' Interest
Distribution Amount and the Targeted Principal Distribution Amount, if any, for
such Distribution Date, in accordance with Section 5.01(c)(iii) and (v) hereof.
                                           ----------------------------   
With respect to any Mandatory Redemption Date or Optional Redemption Date, the
Indenture Trustee shall withdraw from the Collection Account and deposit into
the Paying Account the Mandatory Redemption Price or the Optional Redemption
Price, as the case may be, in accordance with Section 10.03 of the Indenture.

          Section 5.04  Trust Accounts; Trust Account Property.
                        --------------------------------------   

          (a)  Control of Trust Accounts. Each of the Trust Accounts established
               -------------------------  
hereunder has been pledged by the Issuer Trust to the Indenture Trustee under
the Indenture and shall be subject to the lien of the Indenture. In addition to
the provisions hereunder, each of the Trust Accounts shall also be established
and maintained pursuant to the Indenture. Amounts distributed from each Trust
Account in accordance with the Indenture and this Agreement shall be released
from the lien of the Indenture upon such distribution thereunder or hereunder.
The Indenture Trustee shall possess all right, title and interest in and to all
funds on deposit from time to time in the Trust Accounts and in all proceeds
thereof (including all income thereon) and all such funds, investments, proceeds
and income shall be part of the Trust Account Property and the Trust Estate. If,
at any time, any Trust Account ceases to be an Eligible Account, the Indenture
Trustee (or the Servicer on its behalf) shall, within ten Business Days (or such
longer period, not to exceed 30 calendar days, as to which the Rating Agency may
consent) (i) establish a new Trust Account as an Eligible Account, (ii)
terminate 

                                      F-27
<PAGE>
 
the ineligible Trust Account, and (iii) transfer any cash and investments from
such ineligible Trust Account to such new Trust Account.

          With respect to the Trust Accounts, the Indenture Trustee agrees, by
its acceptance hereof, that each such Trust Account shall be subject to the sole
and exclusive custody and control of the Indenture Trustee for the benefit of
the Noteholders and the Issuer Trust, as the case may be, and the Indenture
Trustee shall have sole signature and withdrawal authority with respect thereto.

          The Servicer shall have the power, revocable by the Indenture Trustee,
to instruct the Indenture Trustee to make withdrawals and payments from the
Trust Accounts for the purpose of permitting the Indenture Trustee to carry out
its respective duties herein and under the Indenture.

          (b)  (1)  Investment of Funds.  So long as no Event of Default shall
                    -------------------                                       
have occurred and be continuing, the funds held in any Trust Account shall be
invested in Permitted Investments, as specifically directed by the Servicer in
writing.  In any case, funds in any Trust Account must be available for
withdrawal without penalty, and any Permitted Investments must mature or
otherwise be available for withdrawal, not later than the Business Day
immediately preceding the Distribution Date next following the date of such
investment and shall not be sold or disposed of prior to its maturity subject to
subsection (b)(2) of this Section; except for Permitted Investments in the
Capitalized Interest Account which must mature on or before the Business Day
immediately preceding the Distribution Dates occurring in November 1998, May
1999 and November 1999, in amounts sufficient to provide for the distributions
under Sections 5.01(c)(i) and (iii) to be made on such Distribution Dates.  All
      -----------------------------                                            
interest and any other investment earnings on amounts or investments held in any
Trust Account, except for the Debt Service Reserve Account and the Capitalized
Interest Account, shall be deposited into the Collection Account immediately
upon receipt by the Indenture Trustee and shall comprise a portion of the
Available Collection Amount. With respect to the Debt Service Reserve Account,
so long as no Event of Default has occurred and is continuing and the amount on
deposit in the Debt Service Reserve Account exceeds the Required Debt Service
Reserve Amount, all interest and any other investment earnings with respect to
such excess amount shall be deposited into the Collection Account on receipt.
All income or other gain from investments in the Capitalized Interest Account
will remain in such account to be applied to the payment of interest to the
Noteholders on each Distribution Date up to and including the Distribution Date
occurring in November 1999. All Permitted Investments in which funds in any
Trust Account are invested must be held by or registered in the name of "The
Bank of New York, as Indenture Trustee, in trust for the Denver Arena Trust
Arena Revenue Backed Notes."

          (2)  Insufficiency and Losses in Trust Accounts.  If any amounts are
               ------------------------------------------                     
needed for disbursement from any Trust Account held by or on behalf of the
Indenture Trustee and sufficient uninvested funds are not available to make such
disbursement, the Indenture Trustee shall cause to be sold or otherwise
converted to cash a sufficient amount of the investments in such Trust Account.
The Indenture Trustee shall not be liable for any investment loss or other

                                      F-28
<PAGE>
 
charge resulting therefrom, unless such loss or charge is caused by the failure
of the Indenture Trustee or Owner Trustee, respectively, to perform in
accordance with this Section 5.04.
                     ------------ 

          If any losses are realized in connection with any investment in any
Trust Account pursuant to this Agreement and the Indenture, then the Transferor
shall deposit the amount of such losses (to the extent not offset by income from
other investments in such Trust Account) into such Trust Account immediately
upon the realization of such loss.  All interest and any other investment
earnings on amounts held in any Trust Account shall be taxed to the Issuer Trust
and for federal and state income tax purposes the Issuer Trust shall be deemed
to be the owner of each Trust Account.

          (c)  Subject to Sections 6.01 and 6.02 of the Indenture, the Indenture
Trustee shall not in any way be held liable by reason of any insufficiency in
any Trust Account held by the Indenture Trustee resulting from any investment
loss on any Permitted Investment included therein (except to the extent that the
Indenture Trustee is the obligor and has defaulted thereon).

          (d)  With respect to the Trust Account Property, the Indenture Trustee
acknowledges and agrees that:

          (1)  any Trust Account Property that is held in deposit accounts shall
     be held solely in the Eligible Accounts, subject to the last sentence of
     subsection (a) of this Section 5.04; and each such Eligible Account shall
                            ------------                                      
     be subject to the sole and exclusive dominion, custody and control of the
     Indenture Trustee; and, without limitation on the foregoing, the Indenture
     Trustee shall have sole signature authority with respect thereto;

          (2)  any Trust Account Property that constitutes Physical Property
     shall be delivered to the Indenture Trustee in accordance with paragraph
     (a) of the definition of "Delivery" in Appendix A hereto and shall be held,
                                            ----------                          
     pending maturity or disposition, solely by the Indenture Trustee or a
     financial intermediary (as such term is defined in Section 8-313(4) of the
     UCC) acting solely for the Indenture Trustee;

          (3)  any Trust Account Property that is a book-entry security held
     through the Federal Reserve System pursuant to federal book-entry
     regulations shall be delivered in accordance with paragraph (b) of the
     definition of "Delivery" in Appendix A hereto and shall be maintained by
                                 ----------                                  
     the Indenture Trustee, pending maturity or disposition, through continued
     book-entry registration of such Trust Account Property as described in such
     paragraph; and

          (4)  any Trust  Account Property that is an "uncertificated security"
     under Article 8 of the UCC and that is not governed by clause (3) above
     shall be delivered to the Indenture Trustee in accordance with paragraph
     (c) of the definition of "Delivery" in Appendix A hereto and shall be
                                            ----------                    
     maintained by the Indenture Trustee, pending maturity or disposition,
     through continued registration of the Indenture Trustee's (or its
     nominee's) ownership of such security.

                                      F-29
<PAGE>
 
          (e)  The Servicer shall have the power, revocable by the Indenture
Trustee or by the Owner Trustee with the consent of the Indenture Trustee, to
instruct the Indenture Trustee to make withdrawals and payments from the Trust
Accounts for the purpose of permitting the Servicer or the Owner Trustee to
carry out their respective duties hereunder or under the Indenture or the Trust
Agreement, as the case may be.

          (f)  The Indenture Trustee shall have no liability whatsoever for any
loss, fee, tax or other charge on any investment, reinvestment or liquidation of
an investment hereunder.

                                  ARTICLE VI

             STATEMENTS AND REPORTS; SPECIFICATION OF TAX MATTERS
             ----------------------------------------------------

          Section 6.01  Statements.
                        ----------   

          (a)  No later than the Determination Date related to each Distribution
Date, the Servicer shall deliver to the Indenture Trustee by facsimile, the
receipt and legibility of which shall be confirmed by telephone, and with hard
copy thereof to be delivered no later than one (1) Business Day after such
Determination Date, the Servicer's Remittance Report, setting forth the date of
such report (day, month and year), the name of the Issuer Trust (i.e. "Denver
Arena Trust") and the date of this Agreement, all in substantially the form set
out in Exhibit B hereto.
       ---------        

          (b)  On each Distribution Date, Indenture Trustee shall distribute,
based on information provided by the Servicer, a statement (the "Distribution
                                                                 ------------
Statement") to the Owner Trustee, the Securityholders and the Rating Agency,
---------                                                                   
stating the date of original issuance of the Notes (day, month and year), the
name of the Issuer Trust (i.e.  "Denver Arena Trust"), the date of this
Agreement and the following information:

               (i)    the Available Collection Amount for the related
Distribution Date;

               (ii)   the aggregate Principal Balance of the Notes before and
after giving effect to any distributions made to the Noteholders on such
Distribution Date;

               (iii)  the amount of principal, if any, and interest to be
distributed to the Noteholders on the related Distribution Date and the Targeted
Principal Distribution Amount for such Distribution Date, if any;

               (iv)   any amount to be distributed to Certificateholders on such
Distribution Date;

               (v)    the Servicing Compensation, the Indenture Trustee Fee, the
Owner Trustee Fee and the Custodian Fee, if any, for such Distribution Date;

                                      F-30
<PAGE>
 
               (vi)   certain performance information, including, without
limitation, delinquency information with respect to the Revenue Agreements
indicating which Revenue Agreements are Delinquent, 30 days Delinquent, 60 days
Delinquent, 90 days Delinquent and any Revenue Agreement which is more than 90
days Delinquent;

               (vii)  a listing of Revenue Contractors and Revenue Agreements
subject to bankruptcy proceedings, and the aggregate amount outstanding under
the related Revenue Agreements;

               (viii) a listing of any Revenue Agreements which have been
terminated, the aggregate amount remaining unpaid under each such Revenue
Agreement, and any related Subsequent Revenue Agreement entered into and the
aggregate amount owed by the Revenue Contractor under any such Subsequent
Revenue Agreement;

               (ix)   the amount of any Insurance Proceeds, Condemnation
Proceeds, liquidated damage payments, payments from performance and payment
bonds, indemnity payments and the proceeds of any action to liquidate any
portion of the Collateral; and

               (x)    the amount of the expenditures made or incurred by the
Indenture Trustee, the Issuer Trust and the Servicer, as applicable, in
connection with the exercise of rights or remedies under the Basic Documents.

          In the case of information furnished to Noteholders pursuant to
subclause (b)(iii) of this Section 6.01, the amounts shall be expressed as a
                           ------------                                     
dollar amount per Note with a $1,000 Denomination.

          All reports prepared by the Indenture Trustee of the withdrawals from
and deposits into the Collection Account will be based in whole or in part upon
the information provided to the Indenture Trustee by the Servicer, and the
Indenture Trustee may fully rely upon and shall have no liability with respect
to such information provided by the Servicer.

          (c)  Within a reasonable period of time after the end of each calendar
year, the Indenture Trustee shall prepare and distribute to each Person that at
any time during the calendar year was a Noteholder such information as is
reasonably necessary to provide to such Person a statement containing the
information set forth in subclause (b)(iii) of this Section 6.01, aggregated for
                                                    ------------                
such calendar year or applicable portion thereof during which such Person was a
Noteholder.

          (d)  On each Distribution Date, the Indenture Trustee shall forward to
the Certificateholders a copy of the Distribution Statement in respect of such
Distribution Date and a statement setting forth the amounts actually distributed
to such Certificateholders on such Distribution Date, together with such other
information as the Indenture Trustee deems necessary or appropriate.

          (e)  Within a reasonable period of time after the end of each calendar
year, the Indenture Trustee shall prepare and distribute to each Person that at
any time during the 

                                      F-31
<PAGE>
 
calendar year was a Certificateholder, if requested in writing by such Person, a
statement containing the information provided pursuant to the previous paragraph
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder.

          (f)  The Indenture Trustee shall forward to each Securityholder,
during the term of this Agreement, such periodic, special or other reports,
including information tax returns or reports required with respect to the Notes
and the Trust Certificates, as shall be necessary, reasonable, or appropriate
with respect to such Securityholders, or otherwise with respect to this
Agreement, all such reports or information, in the case of the Trust
Certificates, to be provided by and in accordance with such applicable
instructions and directions as the Majority Certificateholders may reasonably
require.

          (g)  Reports furnished by the Servicer and the Indenture Trustee
pursuant to this Agreement shall be deemed confidential and of a proprietary
nature and shall not be copied or distributed except in connection with the
purposes and requirements of this Agreement.  No Person entitled to receive
copies of such reports shall use the information therein for the purpose of
soliciting the customers of the Transferor or the Servicer or for any other
purpose except as set forth in this Agreement.

          Section 6.02  Specification of Certain Tax Matters.
                        ------------------------------------   

          The Indenture Trustee shall comply with all requirements of the Code
and applicable state and local law with respect to the withholding from any
distributions made to any Securityholder of any applicable withholding taxes
imposed thereon and with respect to any applicable reporting requirements in
connection therewith, giving due effect to any applicable exemptions from such
withholding and effective certifications or forms provided by the recipient.
Any amounts withheld pursuant to this Section 6.02 shall be deemed to have been
                                      ------------                             
distributed to the Noteholders or Certificateholders, as the case may be, for
all purposes of this Agreement or the Indenture.

                                  ARTICLE VII

                          GENERAL SERVICING PROCEDURE
                          ---------------------------

          Section 7.01  Security Interest
                        -----------------

          The Servicer hereby covenants and agrees that it shall not sell,
pledge, assign or transfer to any other Person, or grant, create, incur, assume
or suffer to exist any Lien (in favor of any Person other than the Issuer Trust
or Indenture Trustee) on, any Trust Asset sold and assigned to the Issuer Trust,
whether now existing or hereafter created, or any interest therein, and the
Servicer shall defend the right, title and interest of the Issuer Trust in, to
and under any Trust Asset sold and assigned to the Issuer Trust, whether now
existing or hereafter created, against all claims of third parties claiming
through or under the Servicer or the Transferor, provided, however, that nothing
                                                 --------  -------              
in this Section 7.01 shall prevent or be deemed to 
        ------------                                                         

                                      F-32
<PAGE>
 
prohibit the Servicer from suffering to exist upon any of the Trust Assets any
Lien specifically permitted under the terms of the related Revenue Agreement.

          Section 7.02  Lockbox Agreement; Lockbox Account; Lockbox Bank.
                        ------------------------------------------------   

          (a)  The Servicer shall (i) direct each Revenue Contractor in writing,
on or before July 1, 1999, to make all payments required under the Revenue
Agreements to the Lockbox Account, (ii) maintain, and keep in full force and
effect, the Lockbox Agreement, except to the extent otherwise permitted under
the terms of this Agreement, and (iii) ensure that the Lockbox Account shall be
free and clear of, and defend the Lockbox Account against, any writ, order,
stay, judgment, warrant of attachment or execution or similar process.

          (b)  The parties hereto hereby acknowledge that the Lockbox Bank has
been appointed by the Servicer to hold the Lockbox Account and the Trust
Accounts, and that the Lockbox Bank is not an agent of the Indenture Trustee,
and is acting under this Agreement as an independent contractor.

          (c)  The Indenture Trustee shall not be liable by reason of any act or
omission of the Lockbox Bank.

          (d)  The Servicer hereby agrees to indemnify each of the Indenture
Trustee or any predecessor Indenture Trustee and their respective agents for,
and shall hold each such Person harmless against, any and all loss, damage,
claims, liability or expense, including taxes (other than taxes based upon,
measured by or determined by the income of the Indenture Trustee), arising out
of or in connection with the acceptance or administration by each such Person of
the trust or trusts hereunder, including the costs and expenses incurred by each
such Person in defending itself against any claim (whether asserted by the
Servicer, any Holder of a Note or any other Person) or any liability resulting
from the exercise or performance of any of the powers or duties of such Person
hereunder, except to the extent that such loss, damage, claim, liability or
expense is due to such Person's own gross negligence or willful misconduct.

          The provisions of this Section 7.02(d) shall survive the termination
                                 ---------------                              
of this Agreement.

          Section 7.03  Servicing Compensation.
                        ----------------------   

          As compensation for its services hereunder, the Servicer shall be
entitled to receive from the Collection Account the Servicing Fee, out of which
the Servicer shall pay any servicing fees owed or payable to any Subservicer.
Additional servicing compensation in the form of administrative fees,
insufficient funds charges, and late payment charges and penalties shall be part
of the Servicing Compensation payable to the Servicer and any Subservicer
hereunder and shall be paid either by the Servicer's retaining such additional
servicing compensation prior to deposit into the Collection Account pursuant to
Section 5.01(b)(1) hereof or, if deposited into the Collection Account, as part
------------------                                                             
of the Servicing Compensation withdrawn from the Collection Account pursuant to
Section 5.01(c)(i) hereof.
------------------        

                                      F-33
<PAGE>
 
          The Servicer and any Subservicer shall be required to pay all expenses
incurred by them in connection with their servicing activities hereunder and
shall not be entitled to reimbursement therefor except as specifically provided
for herein.  The Transferor also agrees to pay (i) all reasonable costs and
expenses incurred by any successor Servicer or the Indenture Trustee in
replacing the Servicer or any Subservicer in the event of a default by the
Servicer or any Subservicer in the performance of their respective duties under
the terms and conditions of this Agreement and (ii) the annual monitoring fees
of the Rating Agency.

          Section 7.04  Statement as to Compliance and Financial Statements.
                        ---------------------------------------------------   

          The Servicer will deliver to the Indenture Trustee, the Owner Trustee
and the Rating Agency not later than 90 days following the end of each fiscal
year of the Servicer (beginning in 1999 with respect to the 1998 fiscal year),
an Officer's Certificate stating that (i) a review of the activities of the
Servicer and the Issuer Trust during the preceding year and of performance under
this Agreement has been made under such officer's supervision and (ii) to the
best of such officer's knowledge, based on such review, each of the Servicer and
the Issuer Trust has fulfilled all of its obligations under this Agreement and
the Indenture throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof and what action the Servicer proposes
to take with respect thereto.

          Contemporaneously with the submission of the Officer's Certificate
required by the preceding paragraph, the Servicer shall deliver to the Indenture
Trustee a copy of its annual financial statements prepared in the ordinary
course of business. The Servicer shall, upon the request of the Issuer Trust,
deliver to such party any unaudited quarterly financial statements of the
Servicer.

          The Servicer agrees to make available to the Issuer Trust and the
Indenture Trustee on a reasonable basis a knowledgeable officer of the Servicer
for the purpose of answering reasonable questions respecting recent developments
affecting the Servicer or the financial statements of the Servicer and to permit
the Issuer Trust and the Indenture Trustee on reasonable notice to inspect the
Servicer's servicing facilities during normal business hours for the purpose of
satisfying the Issuer Trust and the Indenture Trustee that the Servicer has the
ability to service the Trust Assets in accordance with this Agreement.

          The Servicer shall also furnish and certify to the requesting party
such other information as to (i) its organization, activities and personnel
relating to the performance of the obligations of the Servicer hereunder, (ii)
its financial condition, (iii) the Trust Assets and (iv) the performance of the
obligations of any Subservicer under the related Subservicing Agreement, in each
case as the Indenture Trustee or the Issuer Trust may reasonably request from
time to time.

          Section 7.05  Independent Public Accountants' Servicing Report.
                        ------------------------------------------------    

          (a)  The Servicer shall cause a firm of Independent Accountants (which
may provide other services to the Servicer) to prepare, and the Servicer shall
deliver to the 

                                      F-34
<PAGE>
 
Indenture Trustee, the Issuer Trust and the Rating Agency, a report addressed to
the Servicer, which may be included as part of the Servicer's or any
Subservicer's customary auditing activities, for the information and use of the
Indenture Trustee, Securityholders and Issuer Trust on or before May 31 of each
year, beginning May 31, 1999, to the effect that such firm has performed certain
procedures in connection with the Servicer's compliance with the servicing
procedures of this Agreement, identifying the results of such procedures and
including any exceptions noted.

          (b)  The report of the Independent Accountants shall also indicate
that such accounting firm is independent of the Servicer within the meaning of
the Code of Professional Ethics of the American Institute of Certified Public
Accountants.

          Section 7.06  Right to Examine Servicer Records.
                        ---------------------------------   

          Each Securityholder, the Indenture Trustee, the Issuer Trust and each
of their respective agents shall have the right upon reasonable prior notice,
during normal business hours and as often as reasonably required, to examine,
audit and copy, at the expense of the Person making such examination, any and
all of the books, records or other information of the Servicer (including
without limitation any Subservicer to the extent provided in the related
Subservicing Agreement), whether held by the Servicer or by another on behalf of
the Servicer, which may be relevant to the performance or observance by the
Servicer of the material terms, covenants or conditions of this Agreement.  In
the case of the supervisory agents and examiners of the Issuer Trust, Indenture
Trustee and the Securityholders, access to the documentation regarding the Trust
Assets required by applicable state and federal regulations shall be afforded
without charge but only upon reasonable request and during normal business hours
at the offices of the Servicer designated by it.  Each Securityholder, the
Indenture Trustee and the Issuer Trust agree that any information obtained
pursuant to the terms of this Agreement shall be held confidential.

          The Servicer also agrees to make available on a reasonable basis to
the Securityholders or any prospective Securityholder a knowledgeable financial
or accounting officer for the purpose of answering reasonable questions
respecting recent developments affecting the Servicer or the financial
statements of the Servicer and to permit the Securityholders and any prospective
Securityholder to inspect the Servicer's servicing facilities during normal
business hours for the purpose of satisfying the Securityholders and such
prospective Securityholder that the Servicer has the ability to service and
administer the Trust Assets in accordance with this Agreement.

          Section 7.07  Reports to the Indenture Trustee; Collection Account
                        ----------------------------------------------------
Statements.
----------   

          If the Collection Account is not maintained with the Indenture
Trustee, then not later than 25 days after each Record Date, the Servicer shall
forward to the Indenture Trustee a statement, certified by a Servicing Officer,
setting forth the status of the Collection Account as of the close of business
on the preceding Record Date and showing, for the period covered by such
statement, the aggregate of deposits into the Collection Account for each
category of deposit specified in Section 5.01(b)(1) hereof, the aggregate of
                                 ------------------                         
withdrawals from the 

                                      F-35
<PAGE>
 
Collection Account for each category of withdrawal specified in Section
                                                                -------
5.01(b)(2) and (3) hereof.
----------     ---        

          Section 7.08  Financial Statements.
                        --------------------   

          The Servicer understands that, in connection with the transfer of the
Notes, Noteholders may request that the Servicer make available to the
Noteholders and to prospective Noteholders annual financial statements of the
Servicer for one or more of the most recently completed five fiscal years for
which such statements are available, which request shall not be unreasonably
denied.

          Section 7.09  Accounting and Reports
                        ----------------------

          For all purposes of this Section 7.09, the Servicer shall act on
                                   ------------                           
behalf of the Owner Trustee who in turn shall be acting on behalf of the Issuer
Trust.  The Servicer shall deliver to each Certificateholder, as may be required
by the Code and applicable Treasury Regulations, or as may be requested by such
Certificateholder, such information, reports or statements as may be necessary
to enable each Certificateholder to prepare its federal and state income tax
returns.  Consistent with the Issuer Trust's characterization for tax purposes
as a security arrangement for the issuance of non-recourse debt so long as the
Transferor or any other Person is the sole Certificateholder, no federal income
tax return shall be filed on behalf of the Issuer Trust unless either (i) the
Servicer shall receive an opinion of counsel that, based on a change in
applicable law occurring after the date hereof, or as a result of a transfer by
the Transferor permitted by Section 3.4 of the Trust Agreement, the Code
requires such a filing or (ii) the Internal Revenue Service shall determine that
the Trust is required to file such a return. In the event that there shall be
two or more Certificateholders, (x) the Servicer shall prepare or shall cause to
be prepared federal and, if applicable, state or local partnership tax returns
required to be filed by the Issuer Trust and shall remit such returns to the
Transferor (or if the Transferor no longer owns any Trust Certificates, the
Certificateholder selected by a majority of the Certificateholders (by
Percentage Interest) for such purpose) at least five days before such returns
are due to be filed, and (y) capital accounts shall be maintained for each
Certificateholder in accordance with the Treasury Regulations under Section
704(b) of the Code reflecting each such Certificateholder's pro rata share of
the income, gains, deductions, and losses of the Issuer Trust and contributions
to, and distributions from, the Issuer Trust. The Transferor (or such designee
Certificateholder, as applicable) shall promptly sign such returns and deliver
such returns after signature to the Servicer and such returns shall be filed by
the Servicer with the appropriate tax authorities. In the event that a "tax
matters partner" (within the meaning of Code Section 6231(a)(7)) is required to
be appointed with respect to the Issuer Trust, the Transferor is hereby
designated as tax matters partner or, if the Transferor is not a
Certificateholder, the Certificateholder selected by a majority of the
Certificateholders (by Percentage Interest) shall be designated as tax matters
partner. In no event shall the Servicer or the Transferor (or such designee
Certificateholder, as applicable) be liable for any liabilities, costs or
expenses of the Issuer Trust or the Certificateholders arising out of the
application of any tax law, including federal, state, foreign or local income or
excise taxes or any other tax imposed on or measured by income (or any interest,
penalty or addition with 

                                      F-36
<PAGE>
 
respect thereto or arising from a failure to comply therewith) except for any
such liability, cost or expense attributable to any act or omission by the
Servicer or the Transferor (or such designee Certificateholder, as applicable)
as the case may be, in breach of its obligations under this Agreement.

                                 ARTICLE VIII

                                 THE SERVICER
                                 ------------

          Section 8.01  Indemnification; Third Party Claims.
                        ----------------------------------- 

          (a)  The Servicer shall indemnify the Transferor, the Issuer Trust,
the Owner Trustee and the Indenture Trustee and their respective officers,
directors, employees and agents (each an "Indemnified Party") and hold harmless
                                          -----------------                    
each of them against any and all claims, losses, damages, penalties, fines,
forfeitures, reasonable legal fees and related costs, judgments, and other costs
and expenses resulting from (i) any claim, demand, defense or assertion based on
or grounded upon, or resulting from, a breach of any of the Servicer's
representations and warranties and covenants contained in this Agreement or in
any way relating to the failure of the Servicer to perform its duties and
service and administer the Trust Assets in compliance with the terms of this
Agreement, the Indenture, the Operating and Management Agreement, the
Construction Phase Agreement, the Security Documents and the Revenue Agreements,
or (ii) with respect to the Issuer Trust, any indemnity claims against the
Issuer Trust pursuant to the Revenue Agreements entered into with each of Pepsi,
Coors and US West resulting from the assumption by the Issuer Trust of the
obligations of the Transferor thereunder; provided, however, that if the
Servicer is not liable pursuant to the provisions of Section 8.01(d) hereof for
                                                     ---------------           
its failure to perform its duties and service and administer the Trust Assets in
compliance with the terms of this Agreement, then the provisions of this Section
                                                                         -------
8.01 shall have no force and effect with respect to such failure.
----                                                             

          (b)  The Transferor, the Issuer Trust, the Owner Trustee or the
Indenture Trustee, as the case may be, shall promptly notify the Servicer if a
claim is made by a third party with respect to a breach of any of the Servicer's
representations and warranties and covenants contained in this Agreement or in
any way relating to the failure of the Servicer to perform its duties and
service and administer the Trust Assets in compliance with the terms of this
Agreement.  The Servicer shall promptly notify the Indenture Trustee and the
Issuer Trust of any claim of which it has been notified pursuant to this Section
                                                                         -------
8.01 by a Person other than the Indenture Trustee or the Issuer Trust, as the
----                                                                         
case may be, and, in any event, shall promptly notify the Issuer Trust and the
Indenture Trustee of its intended course of action with respect to any claim.

          (c)  The Servicer shall be entitled to participate in and, upon notice
to the Indemnified Party, assume the defense of any such action or claim in
reasonable cooperation with, and with the reasonable cooperation of, the
Indemnified Party.  The Indemnified Party will have the right to employ its own
counsel in any such action in addition to the counsel of the Servicer, but the
fees and expenses of such counsel will be at the expense of such 

                                      F-37
<PAGE>
 
Indemnified Party, unless (i) the employment of counsel by the Indemnified Party
at its expense has been authorized in writing by the Servicer, (ii) the Servicer
has not in fact employed counsel to assume the defense of such action within a
reasonable time after receiving notice of the commencement of the action, or
(iii) the named parties to any such action or proceeding (including any
impleaded parties) include both the Servicer and one or more Indemnified
Parties, and the Indemnified Parties shall have been advised by counsel that
there is a conflict of interest which renders common representation
inappropriate. The Servicer shall not be liable for any settlement of any such
claim or action unless the Servicer shall have consented thereto or be in
default on its obligations hereunder. Any failure by an Indemnified Party to
comply with the provisions of this Section 8.01 shall relieve the Servicer of
                                   ------------                              
liability only if such failure is materially prejudicial to the position of the
Servicer and then only to the extent of such prejudice.

          (d)  None of the Transferor, the Servicer or any of the directors,
officers, employees or agents of the Transferor or the Servicer, shall be under
any liability to the Issuer Trust or the Securityholders for any action taken,
or for refraining from the taking of any action, in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Transferor, the Servicer or any such person against the
remedies provided herein for the breach of the covenants set forth in Section
                                                                      -------
2.06(a) hereof or any warranties, representations or other covenants made
-------                                                                  
herein, or against any specific liability imposed on the Transferor or the
Servicer herein, or against any liability which would otherwise be imposed by
reason of willful misfeasance, bad faith or negligence in the performance of the
duties of the Servicer or the Transferor, as the case may be, or by reason of
reckless disregard of the obligations and duties of the Servicer or the
Transferor, as the case may be, hereunder. The Transferor, the Servicer and any
director, officer, employee or agent of the Transferor or the Servicer, may rely
in good faith on any document of any kind which, prima facie, is properly
executed and submitted by any Person respecting any matters arising hereunder.

          (e)  The Servicer, the Transferor and the Owner Trustee and any
director, officer, employee or agent of the Servicer, the Transferor or the
Owner Trustee shall be indemnified by the Issuer Trust and held harmless against
any loss, liability or expense incurred in connection with any audit,
controversy or judicial proceeding relating to a governmental taxing authority
or any legal action relating to this Agreement or the Securities, other than any
loss, liability or expense related to any specific Trust Asset or Trust Assets
(except as any such loss, liability or expense shall be otherwise reimbursable
pursuant to this Agreement) and any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or negligence in the performance of
duties hereunder or by reason of reckless disregard of obligations and duties
hereunder.  Except as otherwise provided herein, none of the Transferor, the
Owner Trustee or the Servicer shall be under any obligation to appear in,
prosecute or defend any legal action that is not related to its respective
duties under this Agreement; provided, however, that, except as otherwise
provided herein, any of the Transferor, the Owner Trustee or the Servicer may,
with the prior consent of the Indenture Trustee, in its discretion undertake any
such action which it may deem necessary or desirable with respect to this
Agreement and the rights and duties of the parties hereto and the interests 

                                      F-38
<PAGE>
 
of the Securityholders hereunder. In such event, the legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Issuer Trust, and the Transferor, the Owner Trustee and the
Servicer shall be entitled to be reimbursed therefor out of the Collection
Account.

          Section 8.02  Merger or Consolidation of the Servicer.
                        ---------------------------------------   

          The Servicer shall keep in full effect its existence, rights and
franchises as a limited liability company, and will obtain and preserve its
qualification to do business as a foreign company and maintain such other
licenses and permits  in each jurisdiction necessary to  protect the validity
and enforceability of this Agreement or any of the Trust Assets and to perform
its duties under this Agreement; provided, however, that the Servicer may merge
or consolidate with any other entity upon the satisfaction of the conditions set
forth in the following paragraph.

          Any Person into which the Servicer may be merged or consolidated, or
any entity resulting from any merger, conversion or consolidation to which the
Servicer shall be a party, or any Person succeeding to the business of the
Servicer, shall be an Eligible Servicer and shall be the successor of the
Servicer, as applicable hereunder, without the execution or filing of any paper
or any further act on the part of any of the parties hereto, anything herein to
the contrary notwithstanding.  The Servicer shall send notice of any such
merger, conversion, consolidation or succession to the Indenture Trustee, the
Issuer Trust and the Rating Agency.

          Section 8.03  Limitation on Liability of the Servicer and Others.
                        -------------------------------------------------- 

          The Servicer and any director, officer, employee or agent of the
Servicer may rely on any document of any kind which it in good faith reasonably
believes to be genuine and to have been adopted or signed by the proper
authorities respecting any matters arising hereunder.  Subject to the terms of
Section 8.01 hereof, the Servicer shall have no obligation to appear with
------------                                                             
respect to, prosecute or defend any legal action which is not incidental to the
Servicer's duty to service the Trust Assets in accordance with this Agreement.

          Section 8.04  Servicer Not to Resign; Assignment.
                        ---------------------------------- 

          The Servicer shall not resign from the obligations and duties hereby
imposed on it except (a) with the consent of the Indenture Trustee or (b) upon
determination that its duties hereunder are no longer permissible under
applicable law.  Any such determination pursuant to clause (b) of the preceding
sentence permitting the resignation of the Servicer shall be evidenced by an
independent opinion of counsel to such effect delivered (at the expense of the
Servicer) to the Indenture Trustee.  No resignation of the Servicer shall become
effective until a successor servicer, appointed pursuant to the provisions of
Section 9.02 hereof and  satisfying the requirements of Section 4.05 hereof with
------------                                            ------------            
respect to the qualifications of a successor Servicer, shall have assumed the
Servicer's responsibilities, duties, liabilities (other than those liabilities
arising prior to the appointment of such successor) and obligations under this
Agreement.

                                      F-39
<PAGE>
 
          Except as expressly provided herein, the Servicer shall not assign or
transfer any of its rights, benefits or privileges hereunder to any other
Person, or delegate to or subcontract with, or authorize or appoint any other
Person to perform any of the duties, covenants or obligations to be performed by
the Servicer hereunder and any agreement, instrument or act purporting to effect
any such assignment, transfer, delegation or appointment shall be void.

          The Servicer agrees to cooperate with any successor Servicer in
effecting the transfer of the Servicer's servicing responsibilities and rights
hereunder pursuant to the first paragraph of this Section 8.04, including,
                                                  ------------            
without limitation, the transfer to such successor of all relevant records and
documents (including the Servicer's Contract Files) and all amounts received
with respect to the Trust Assets and not otherwise permitted to be retained by
the Servicer pursuant to this Agreement.  In addition, the Servicer, at its sole
cost and expense, shall prepare, execute and deliver any and all documents and
instruments to the successor Servicer and do or accomplish all other acts
necessary or appropriate to effect such termination and transfer of servicing
responsibilities.

          Section 8.05  Relationship of Servicer to Issuer Trust and the
                        ------------------------------------------------
Indenture Trustee.
----------------- 

          The relationship of the Servicer (and of any successor to the Servicer
as servicer under this Agreement) to the Issuer Trust and the Indenture Trustee
under this Agreement is intended by the parties hereto to be that of an
independent contractor and not of a joint venturer, agent or partner of the
Issuer Trust or the Indenture Trustee.

          Section 8.06  Servicer May Own Notes.
                        ---------------------- 

          Each of the Servicer and any Affiliate of the Servicer may in its
individual or any other capacity become the owner or pledgee of Notes with the
same rights as it would have if it were not the Servicer or an Affiliate thereof
except as otherwise specifically provided herein.  Notes so owned by or pledged
to the Servicer or such Affiliate shall have an equal and proportionate benefit
under the provisions of this Agreement, without preference, priority, or
distinction as among all of the Notes; provided, however, that any Notes owned
by the Servicer or any Affiliate thereof, during the time such Notes are owned
by them, shall be without voting rights for any purpose set forth in this
Agreement.  The Servicer shall notify the Indenture Trustee promptly after it or
any of its Affiliates becomes the owner or pledgee of a Note.

                                  ARTICLE IX

                                    DEFAULT
                                    -------

          Section 9.01  Servicer Events of Default.
                        --------------------------   

          (a)  In case one or more of the following events of default by the
Servicer (each, a "Servicer Event of Default") shall occur and be continuing:
                   -------------------------                                 

                                      F-40
<PAGE>
 
               (i)    any failure by the Servicer to deposit in the Collection
Account in accordance with Section 5.01(b) hereof any payments in respect of the
                           ---------------     
Revenue Agreements received by the Servicer no later than the second Business
Day following the day on which such payments were received; or

               (ii)   failure by the Servicer to execute, on behalf of the
Issuer Trust, amended and restated Revenue Agreements with each of Pepsi and
Coors on the Closing Date as described in Section 4.01(b) hereof or to observe
or perform, in any material respect, any other covenants, obligations or
agreements of the Servicer as set forth in this Agreement or under the Operating
and Management Agreement, which failure continues unremedied for a period of 30
days after the date on which written notice of such failure, requiring the same
to be remedied and stating that such notice is a "Notice of Default" hereunder,
shall have been given (a) to the Servicer by the Indenture Trustee or the Issuer
Trust, or (b) to the Servicer by the Majority Noteholders; or

               (iii)  a decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or receiver
or liquidator in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Servicer and such decree or order
shall have remained in force, undischarged or unstayed for a period of 60 days;
or

               (iv)   the Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or relating to
the Servicer or of or relating to all or substantially all of the Servicer's
property; or

               (v)    the Servicer shall admit in writing its inability to pay
its debts as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations; or

               (vi)   the Majority Noteholders shall receive notice from the
Servicer that the Servicer is no longer able to discharge its duties under this
Agreement;

          (b)  then, and in each and every such case, so long as a Servicer
Event of Default shall not have been remedied, the Indenture Trustee or the
Majority Noteholders, by notice in writing to the Servicer may, in addition to
whatever rights such Person may have at law or in equity to damages, including
injunctive relief and specific performance, terminate all the rights and
obligations of the Servicer under this Agreement and any Subservicer under the
Operating and Management Agreement and in and to the Trust Assets and the
proceeds thereof, as servicer under this Agreement. Upon receipt by the Servicer
of such written notice, all authority and power of the Servicer under this
Agreement, whether with respect to the Trust Assets or otherwise, shall, subject
to Section 9.02 hereof, pass to and be vested in a successor servicer, or the
   ------------
Indenture Trustee if a successor servicer cannot be retained in a timely manner,
and the successor servicer, or Indenture Trustee, as applicable, is hereby

                                      F-41
<PAGE>
 
authorized and empowered to execute and deliver, on behalf of the Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments and
do or cause to be done all other acts or things necessary or appropriate to
effect the purposes of such notice of termination, including, but not limited
to, the transfer and endorsement or assignment of the Trust Assets and related
documents. The Servicer agrees to cooperate with the successor servicer in
effecting (i) the termination of the Servicer's responsibilities and rights
hereunder, including, without limitation, the transfer to the successor servicer
for administration by it of all amounts which shall at the time be credited by
the Servicer to the Collection Account or thereafter received with respect to
the Trust Assets and (ii) the termination of any Subservicer's responsibilities
and rights under the Operating and Management Agreement.

          (c)  In the event that the Servicer is terminated as Servicer
hereunder, the Servicer hereby agrees that it shall immediately thereafter
relinquish all supervisory rights with respect to the Operator held by it under
the Operating and Management Agreement or in its capacity as owner of the New
Arena Facility.

          Section 9.02  Indenture Trustee to Act; Appointment of Successor.
                        -------------------------------------------------- 

          On and after the date the Servicer receives a notice of termination
pursuant to Section 9.01 hereof, or the Indenture Trustee receives the
            ------------                                              
resignation of the Servicer evidenced by an Opinion of Counsel or accompanied by
the consents required by Section 8.04 hereof, or the Servicer is removed as
                         ------------                                      
servicer pursuant to this Article IX, then, subject to Section 4.05 hereof, the
                                                       ------------            
Majority Noteholders, with the approval of the Rating Agency, shall appoint a
successor servicer to be the successor in all respects to the Servicer in its
capacity as Servicer under this Agreement and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Servicer by the terms and provisions
hereof; provided, however, that the successor servicer shall not be liable for
any actions of any prior servicer.

          As compensation therefor, the successor servicer appointed pursuant to
the following paragraph, shall be entitled to all funds relating to the Trust
Assets which the Servicer would have been entitled to receive from the
Collection Account pursuant to Section 5.01(c) hereof as if the Servicer had
                               ---------------                              
continued to act as servicer hereunder, together with other Servicing
Compensation in the form of administration fees, late payment charges or
otherwise as provided in Section 7.03 hereof.  The Servicer shall not be
                         ------------                                   
entitled to any termination fee if it is terminated pursuant to Section 9.01
                                                                ------------
hereof but shall be entitled to any accrued and unpaid Servicing Fee to the date
of termination.

          Any collections received by the Servicer after removal or resignation
shall be endorsed by it to the Indenture Trustee and remitted directly to the
Indenture Trustee or, at the direction of the Indenture Trustee, to the
successor servicer. The compensation of any successor servicer so appointed
shall be the Servicing Fee, together with other Servicing Compensation provided
for herein. The Indenture Trustee, the Issuer Trust, the Custodian, the Servicer
and any such successor servicer shall take such action, consistent with this
Agreement, as shall be necessary to effect any such succession. The Servicer
agrees to 

                                      F-42
<PAGE>
 
cooperate with the Indenture Trustee and any successor servicer in effecting the
termination of the Servicer's servicing responsibilities and rights hereunder
and shall promptly provide the Indenture Trustee or such successor servicer, as
applicable, all documents and records reasonably requested by it to enable it to
assume the Servicer's functions hereunder and shall promptly also transfer to
the Indenture Trustee or such successor servicer, as applicable, all amounts
which then have been or should have been deposited in any Trust Account
maintained by the Servicer or which are thereafter received with respect to the
Trust Assets. Neither the Indenture Trustee nor any other successor servicer
shall be held liable by reason of any failure to make, or any delay in making,
any distribution hereunder or any portion thereof caused by (i) the failure of
the Servicer to deliver, or any delay in delivering, cash, documents or records
to it or (ii) restrictions imposed by any regulatory authority having
jurisdiction over the Servicer hereunder. No appointment of a successor to the
Servicer hereunder shall be effective until written notice of such proposed
appointment shall have been provided by the Indenture Trustee to each
Securityholder, and the Issuer Trust and, except in the case of the appointment
of the Indenture Trustee as successor to the Servicer (when no consent shall be
required), the Majority Noteholders and the Issuer shall have consented thereto.

          The Indenture Trustee may make such arrangements for the compensation
of such successor servicer out of payments on the Contracts as it and such
successor servicer shall agree; provided, however, that no such compensation
shall be in excess of that permitted the Servicer pursuant to Section 7.03
                                                              ------------
hereof, together with other Servicing Compensation in the form of assumption
fees, late payment charges or otherwise as provided in this Agreement.

          Section 9.03  Waiver of Defaults.
                        ------------------ 

          The Majority Noteholders may waive any events permitting removal of
the Servicer as servicer pursuant to this Article IX; provided, however, that
the Majority Noteholders may not waive a default in making a required
distribution on a Note or Trust Certificate without the consent of the related
Noteholder or Certificateholder.  Upon any waiver of a past default, such
default shall cease to exist and any Servicer Event of Default arising therefrom
shall be deemed to have been remedied for every purpose of this Agreement.  No
such waiver shall extend to any subsequent or other default or impair any right
consequent thereto except to the extent expressly so waived.

          Section 9.04  Accounting Upon Termination of Servicer.
                        --------------------------------------- 

          Upon termination of the Servicer under this Article IX, the Servicer
shall, at its own expense:

          (a)  deliver to its successor or, if none shall yet have been
appointed, to the Indenture Trustee the funds in any Trust Account maintained by
the Servicer;

          (b)  deliver to its successor or, if none shall yet have been
appointed, to the Indenture Trustee the Servicer's Contract Files and related
documents and statements in its possession;

                                      F-43
<PAGE>
 
          (c)  deliver to its successor or, if none shall yet have been
appointed, to the Indenture Trustee and to the Issuer Trust and the
Securityholders a full accounting of all funds, including a statement showing
the Required Payments collected by it and a statement of moneys held in trust by
it for payments or charges with respect to the Contracts; and

          (d)  execute and deliver such instruments and perform all acts
reasonably requested in order to effect the orderly and efficient transfer of
servicing of the Trust Assets to its successor and to more fully and
definitively vest in such successor all rights, powers, duties,
responsibilities, obligations and liabilities of the Servicer under this
Agreement.

          Section 9.05  Transferor Defaults.
                        ------------------- 

          (a)  In case one or more of the following defaults by the Transferor
(each, a "Transferor Default") shall occur and be continuing:

               (1)  any failure of the Transferor to construct the New Arena
     Facility in accordance with the Project Plans, the Construction Contract
     and the Construction Phase Agreement on or before the Outside Completion
     Date;

               (2)  any failure of the Transferor to operate and manage the New
     Arena Facility in accordance with the Arena Agreement, the Lease, the
     Operating and Management Agreement and the User Agreements, which failure
     is likely to result in the termination of any Revenue Agreement by the
     related Revenue Contractor or a material interruption in such Revenue
     Contractor's payment obligation thereunder;

               (3)  receipt by the Issuer Trust or the Indenture Trustee from
     the City of a notice of default by the Transferor in the observance or
     performance of any material covenant or agreement under the Arena Agreement
     or the Lease, and such default is not cured within the grace periods
     provided by the City thereunder;

          (b)  then, and in each and every such case, so long as a Transferor
Default shall not have been remedied, the Indenture Trustee or the Majority
Noteholders, by notice in writing to the Transferor and Servicer may, in
addition to whatever rights such Person may have under the Construction Phase
Mortgage, the Leasehold Mortgage, the Security Agreement [Excess Collateral] or
the Security Agreement [Indenture Trustee], or at law or in equity to damages,
including injunctive relief and specific performance, terminate all the rights
and obligations of the Transferor under this Agreement and in and to the Trust
Assets and proceeds thereof, and in the event of a Transferor Default under
Section 9.05(a), assume all rights of the Transferor under the Construction
---------------                                                            
Phase Agreement, including any rights to proceeds from the Construction Fund
Account.  Upon receipt by the Transferor and Servicer of such written notice,
all authority and power of the Transferor to cause completion of construction of
the New Arena Facility under the Construction Phase Agreement and to operate the
New Arena Facility under the Operating and Management Agreement, whether with
respect to the Trust Assets or otherwise, shall, subject to Section 9.02 hereof,
                                                            ------------        
pass to and be vested in a successor servicer or the Indenture Trustee if a
successor servicer cannot be retained in a timely manner, and the successor
servicer or the Indenture Trustee, as applicable, 

                                      F-44
<PAGE>
 
is hereby authorized and empowered to execute and deliver, on behalf of the
Transferor and the Servicer, as attorney-in-fact or otherwise, any and all
documents and other instruments and do or cause to be done all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, including, but not limited to, the transfer and endorsement or
assignment of the Trust Assets and related documents. The Transferor and the
Servicer agree to cooperate with the successor servicer in effecting the
termination of such responsibilities and rights.

                                   ARTICLE X

                                  TERMINATION
                                  -----------

          Section 10.01  Termination.
                         ----------- 

          This Agreement shall terminate upon notice from the Indenture Trustee
to each other party hereto of either:  (a) the later of (i) the satisfaction and
discharge of the Indenture and the provisions thereof or (ii) the disposition of
all funds with respect to the last Trust Asset and the remittance of all funds
due hereunder and the payment of all amounts due and payable to the Indenture
Trustee, the Owner Trustee, the Issuer Trust and the Custodian; or (b) the
mutual consent of the Servicer, the Transferor and all Securityholders in
writing.

          Section 10.02  Notice of Termination.
                         --------------------- 

          Notice of termination of this Agreement shall be sent (i) by the
Indenture Trustee to the Noteholders in accordance with Section 11.05 of the
Indenture and (ii) by the Owner Trustee to the Certificateholders in accordance
with Section 11.4(b) of the Trust Agreement.

                                  ARTICLE XI

                           MISCELLANEOUS PROVISIONS
                           ------------------------

          Section 11.01  Acts of Noteholders.
                         ------------------- 

          Except as otherwise specifically provided herein, whenever action,
consent or approval of the Noteholders is required under this Agreement, such
action, consent or approval shall be deemed to have been taken or given on
behalf of, and shall be binding upon, all Noteholders if the Majority
Noteholders agree to take such action or give such consent or approval.

          Section 11.02  Amendment.
                         --------- 

          (a)  This Agreement may be amended from time to time by the Servicer,
the Transferor, the Indenture Trustee, the Owner Trustee and the Issuer Trust by
written agreement with notice thereof to the Securityholders, without the
consent of any of the Securityholders,  to cure any error or ambiguity, to
correct or supplement any provisions 

                                      F-45
<PAGE>
 
hereof which may be defective or inconsistent with any other provisions hereof
or to add any other provisions with respect to matters or questions arising
under this Agreement; provided, however, that such action will not adversely
affect in any material respect the interests of the Securityholders. An
amendment described above shall be deemed not to adversely affect in any
material respect the interests of the Securityholders if either (i) an Opinion
of Counsel is obtained to such effect or (ii) the party requesting the amendment
obtains a letter from the Rating Agency confirming that the amendment, if made,
would not result in the downgrading or withdrawal of the rating then assigned by
the Rating Agency to the Notes.

          (b)  This Agreement may also be amended from time to time by the
Servicer, the Transferor, the Indenture Trustee, the Owner Trustee and the
Issuer Trust by written agreement, with the prior written consent of the
Majority Noteholders, for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement, or of
modifying in any manner the rights of the Noteholders; provided, however, that
no such amendment shall (i) reduce in any manner the amount of, or delay the
timing of, collections of payments on Trust Assets or distributions which are
required to be made on the Notes, without the consent of the holders of 100% of
the Notes (excluding any Notes held by the Transferor), (ii) adversely affect in
any material respect the interests of any Noteholders in any manner other than
as described in clause (i), without the consent of the holders of 100% of such
Notes, or (iii) reduce the percentage of Notes, the consent of which is required
for any such amendment, without the consent of the holders of 100% of the Notes.

          (c)  It shall not be necessary for the consent of Securityholders
under this Section to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof.

          Prior to the execution of any amendment to this Agreement, the Owner
Trustee and the Indenture Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that the execution of such amendment is authorized or
permitted by this Agreement.  The Issuer Trust, the Owner Trustee and the
Indenture Trustee may, but shall not be obligated to, enter into any such
amendment which affects the rights, duties or immunities of the Issuer Trust or
the Indenture Trustee, as the case may be, under this Agreement.

          Section 11.03  Recordation of Agreement.
                         ------------------------ 

          The parties hereby agree that this Agreement shall be recorded in the
appropriate public offices in Denver, Colorado.

          Section 11.04  Duration of Agreement.
                         --------------------- 

          This Agreement shall continue in existence and effect until terminated
as herein provided.

                                      F-46
<PAGE>
 
          Section 11.05  Governing Law.
                         ------------- 

          (A)  EXCEPT AS PROVIDED IN (B) BELOW, THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF
LAW.

          (B)  THE CONVEYANCE OF THE TRUST ASSETS PURSUANT TO SECTION 2.01
HEREOF SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF COLORADO AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS, WITHOUT GIVING
EFFECT TO PRINCIPLES OF CONFLICTS OF LAW.

          Section 11.06  Notices.
                         ------- 

          All demands, notices and communications hereunder shall be in writing
and shall be deemed to have been duly given if personally delivered at or mailed
by overnight mail, certified mail or registered mail, postage prepaid, to:  (i)
in the case of the Issuer Trust, DENVER ARENA TRUST, c/o Wilmington Trust
Company, 1100 North Market Street, Rodney Square, Wilmington, Delaware 19890,
Attention:  Corporate Trust Administration, or such other address as may
hereafter be furnished to the Securityholders and the other parties hereto in
writing, with copies to Richards, Layton & Finger, One Rodney Square, 902 King
Street, Wilmington, Delaware 19899; (ii) in the case of the Transferor and the
Servicer, Ascent Arena Company, LLC, 901 Auraria Parkway, Denver, Colorado
80204, Attention:  Mr. Timothy Romani, or such other address as may hereafter be
furnished to the Securityholders and the other parties hereto in writing by the
Servicer or the Transferor, with copies to 101 Barclay Street, New York, New
York 10286; (iii) in the case of the Indenture Trustee, The Bank of New York,
101 Barclay Street, Floor 21 West, New York, New York 10286, Attention:
Corporate Trust Administration, or such other address as may hereafter be
furnished to the Securityholders and the other parties hereto in writing, and
(iv) in the case of the Securityholders, as set forth in the Note Register or
Certificate Register, as applicable.  Any such notices shall be deemed to be
effective with respect to any party hereto upon the receipt of such notice by
such party, except that notices to the Securityholders shall be effective upon
mailing or personal delivery.

          Section 11.07  Severability of Provisions.
                         -------------------------- 

          If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be held invalid for any reason whatsoever, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other covenants,
agreements, provisions or terms of this Agreement.

                                      F-47
<PAGE>
 
          Section 11.08  No Partnership.
                         -------------- 

          Nothing herein contained shall be deemed or construed to create any
partnership or joint venture between the parties hereto and the services of the
Servicer shall be rendered as an independent contractor.

          Section 11.09  Counterparts.
                         ------------ 

          This Agreement may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same Agreement.

          Section 11.10  Successors and Assigns.
                         ---------------------- 

          This Agreement shall inure to the benefit of and be binding upon the
Servicer, the Transferor, the Owner Trustee, the Issuer Trust, the Indenture
Trustee, and the Securityholders and their respective successors and permitted
assigns.

          Section 11.11  Headings.
                         -------- 

          The headings of the various sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed to be part of
this Agreement.

          Section 11.12  Actions of Securityholders.
                         -------------------------- 

          (a)  Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Securityholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Securityholders in person or by agent
duly appointed in writing; and except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Servicer or the Issuer Trust.  Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and conclusive in favor of the Servicer and the Issuer
Trust if made in the manner provided in this Section 11.12.
                                             ------------- 

          (b)  The fact and date of the execution by any Securityholder of any
such instrument or writing may be proved in any reasonable manner which, the
Servicer or the Issuer Trust deems sufficient.

          (c)  Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Securityholder shall bind every holder of every
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done, or omitted to be done,
by the Servicer or the Issuer Trust in reliance thereon, whether or not notation
of such action is made upon such Security.

                                      F-48
<PAGE>
 
          (d)  The Servicer or the Issuer Trust may require additional proof of
any matter referred to in this Section 11.12 as it shall deem necessary.
                               -------------                            

          Section 11.13  Reports to Rating Agency.
                         ------------------------ 

          (a)  The Indenture Trustee shall provide to the Rating Agency copies
of statements, reports and notices, to the extent received or prepared in
connection herewith, as follows:

               (i)    copies of amendments to this Agreement;

               (ii)   notice of any termination of Revenue Agreements, and
copies of Subsequent Revenue Agreements;

               (iii)  notice of any termination, replacement, succession, merger
or consolidation of the Servicer, any Custodian or the Issuer Trust;

               (iv)   notice of final payment on the Notes;

               (v)    notice of any Servicer Event of Default;

               (vi)   copies of the annual independent accountants' report
delivered pursuant to Section 7.05 hereof, and copies of any compliance reports
                      ------------ 
delivered by the Servicer including under Section 7.04 hereof;
                                          ------------        

               (vii)  copies of any Distribution Statement pursuant to Section
                                                                       -------
6.01(b) hereof;
-------        

               (viii) notice of any Mandatory Redemption Date; and

               (ix)   notice of the occurrence of a Lease Reserve Trigger Event
as referred to in Section 5.03(e)(ii) hereof.
               -------------------        

          (b)  With respect to the requirement of the Indenture Trustee to
provide statements, reports and notices to the Rating Agency, such statements,
reports and notices shall be delivered to the Rating Agency at the following
addresses:  (i) if to Fitch, One State Street Plaza, New York, New York  10004,
Attention:  ABS Surveillance Group.

          (c)  The Indenture Trustee makes this covenant as a matter of courtesy
and accommodation only and shall not be liable to any Person for any failure to
comply therewith.

          Section 11.14  Certificateholders.
                         ------------------ 

          (a)  Any sums to be distributed or otherwise paid hereunder or under
the Trust Agreement to the Certificateholders shall be paid to such
Certificateholders pro rata based on their Percentage Interest;

                                      F-49
<PAGE>
 
          (b)  Where any act or event hereunder is expressed to be subject to
the consent or approval of the Certificateholders, such consent or approval
shall be capable of being given by no fewer than the Majority
Certificateholders.

          Section 11.15  Limitation of Liability.
                         -----------------------   

          It is expressly understood and agreed by the parties hereto that (a)
this Agreement is executed and delivered by Wilmington Trust Company, not
individually or personally but solely as Owner Trustee of the Issuer Trust, in
the exercise of the powers and authority conferred and vested in it under the
Trust Agreement, (b) each of the representations, undertakings and agreements
herein made on the part of the Issuer Trust is made and intended not as personal
representations, undertakings and agreements by Wilmington Trust Company but is
made and intended for the purpose of binding only the Issuer Trust, and (c)
under no circumstances shall Wilmington Trust Company be personally liable for
the payment of any indebtedness or expenses of the Issuer Trust or be liable for
the breach or failure of any obligation, representation, warranty or covenant
made or undertaken by the Issuer Trust under this Agreement or the other Basic
Documents.

          Section 11.16  Third Party Beneficiaries.
                         -------------------------   

          The parties hereby agree and acknowledge that each of the Revenue
Contractors shall be deemed to be third party beneficiaries of this Agreement.

          Section 11.17  Limitation on Recourse.
                         ----------------------   

          There will be full recourse to the Collateral with respect to the
obligations of the Transferor, the Servicer or any Subservicer under this
Agreement or the other Basic Documents as described herein and therein.  The
Transferor, the Servicer or any Subservicer will not be held personally liable
or obligated for any of the obligations under the Basic Documents, except as may
be specifically provided in any Basic Document to which it is a party; provided,
however, that such entities will be personally liable for damages arising from
(i) fraud, misrepresentation, or misappropriation or misapplication of funds,
(ii) in the case of the Transferor, any breach of the obligations of the
Transferor to construct the New Arena Facility in a timely manner in accordance
with and pursuant to the terms and conditions of this Agreement, the Arena
Agreement, the Construction Phase Agreement and the Project Plans, or (iii) any
breach of the Team Commitments under the User Agreements, and such entities will
be liable for payment of their respective indemnity obligations under any of the
Basic Documents.

                                      F-50
<PAGE>
 
          IN WITNESS WHEREOF, the Issuer Trust, the Servicer, the Transferor and
the Indenture Trustee have caused their names to be signed by their respective
officers thereunto duly authorized, as of the day and year first above written,
to this Sale and Servicing Agreement.

                              ISSUER TRUST:

                              DENVER ARENA TRUST


                              By:     WILMINGTON TRUST COMPANY, not in its
                                      individual capacity but solely as Owner
                                      Trustee on behalf of the Issuer Trust


                              By:     /s/ Emmett R. Harmon
                                      -----------------------------------------
                              Name:   Emmett R. Harmon
                              Title:  Vice President

                              TRANSFEROR AND SERVICER:

                              ASCENT ARENA COMPANY, LLC


                              By:     Ascent Arena and Development Corporation,
                                      a Delaware corporation, as managing member


                              By:     /s/ Timothy D. Romani
                                      -----------------------------------------
                              Name:   Timothy D. Romani
                              Title:  President

                              INDENTURE TRUSTEE:

                              THE BANK OF NEW YORK


                              By:     /s/ Walter N. Gitlin
                                      -----------------------------------------
                              Name:   Walter N. Gitlin
                              Title:  Vice President

                                      F-51