The Business of HockeyDiscuss the financial and business aspects of the NHL. Franchise sales, valuations, TV contracts, ratings, expansion, relocation, the CBA and work stoppage discussion goes here.
Phoenix XLIII: How to Bake Cupcakes in Less Than Two Weeks
I believe you are referring to Specific Performance. The original Moyes AMULA contained that language. (ie- the Coyotes must play all home games in Jobing.com Arena for the period of 2004 to 2034). That contract was rejected during the bankruptcy case.
Subsequently, the NHL signed an AMUL. The NHL ensured that there was no specific performance language in the new agreement. Further, they wrote language that outlined their right to relocate the team.
Contractually, the owner (whoever it is) has the right to move the Coyotes anytime after the conclusion of this season (technically, it's either 5 or 10 days after the end of the season, I forget which). From here, I defer to KDB regarding the NHL constitution and bylaws for moving franchises.
Well, as we've seen those rules are.... shall we say.... flexible to say the least? i don't have time at the moment to search it out, but last years move of the Thrashers would have been against a few provisions that are in there. The BoG has a great deal of flexibility to suspend the provisions of the constitution as they see fit I seem to recall. Dammit, there goes my evening now reading the darned NHL constitution....
Sorry Scott, I should have recognized the context. The AMULA is still a fun read but to make the good faith claim, you'll need to show that the NHL violated Section 2.12(d) of the Asset Purchase Agreement (http://docs.bmcgroup.com/deweyranchh...20part%201.pdf)
Quote:
(d) Notwithstanding anything herein to the contrary, the Buyers and
Sellers expressly agree that if, prior to December 31, 2009, the Buyers receive a bona fide offer
with respect to a Glendale Team Sale (i) from a bona fide purchaser that (x) complies with all of
the NHL’s requirements for ownership of a Member Club, including submission of all required
application materials, (y) demonstrates to the reasonable satisfaction of the NHL that it has the
financial capability to consummate the Glendale Team Sale and meet the ongoing operating
expenses of the Team and (z) otherwise satisfies the NHL’s standards for approval as an owner
of a Member Club, (ii) that requires the purchaser to execute the NHL’s standard form of
Consent Agreement and to assume the AMULA (as the same may be amended), (iii) that would
result in the Buyers receiving a purchase price at the closing of such Glendale Team Sale that
would result in a Net Profit of not less than $0, and (iv) that would not be subject to a financing
condition or any other material contingencies (other than NHL approval and compliance with the
Hart-Scott-Rodino Act) (any such Glendale Team Sale meeting the foregoing requirements being
a “Preferred Glendale Team Sale”), then the Buyers will accept such offer (or, in the event that
the Buyers receive more than one bona fide offer satisfying the foregoing requirements, any such
offer in the sole discretion of the Buyers) and use their commercially reasonable efforts to
consummate such Preferred Glendale Team Sale, notwithstanding any higher or better offer or
indication of interest that the Buyers may have received that does not satisfy such requirements
(including, without limitation, a transaction that contemplates a relocation of the Team away
from Glendale, Arizona). The Buyers and Sellers expressly agree that the City shall be entitled
to enforce the Buyers’ obligation to accept a Preferred Glendale Team Sale pursuant to this
Section 2.12(d); provided that the City does not object to, challenge or seek to render invalid,
illegal or unenforceable any of the Transaction Documents, including, without limitation, the
Partial Lease Assignment Agreement; and, provided further, that nothing in this Section 2.12(d),
including the immediately preceding proviso, shall restrict or limit the City’s rights with respect
to (x) any action by the Sellers seeking to reject the AMULA or (y) any claims the City may
have against the Sellers or any other person (other than the NHL, any NHL Entity, the Buyers or
their respective Affiliates), including, without limitation, with respect to rejection of the
AMULA.
Which means you'll need the Net Profit definition from the same APA
Quote:
"Net Profit" means the aggregate consideration received by the Buyers or any
direct or indirect parent entity of the Buyers upon consummation of a Team Sale, less (i) the
aggregate consideration paid by the Buyers pursuant to Sections 3.1(a) – (b) of this Agreement,
including the amount of all Assumed Liabilities (including, for the avoidance of doubt, all
Assumed Liabilities relating to Indebtedness owed by the Sellers to the NHL and SOF and Cure
Costs with respect to Assumed Contracts, including the AMULA and the Glendale Contracts, to
the extent they become Assumed Contracts in accordance with Sections 2.12 and 2.14,
respectively), less (ii) the aggregate amount paid by the Buyers for Purchased Claims pursuant to
Section 8.4, less (iii) any additional amounts invested in, or loaned to or paid on behalf of, the
Buyers by the NHL or any NHL Entity or any Affiliates thereof, including any interest charged
thereon, during the period between the Closing Date and the consummation of such Team Sale,
net of any amounts returned by way of loan repayment, dividend or distribution to the NHL or
any NHL Entity or any Affiliates thereof, less (iv) the aggregate amount reasonably expected to
be paid by the Buyers under the Transition Services Agreement during the period between the
consummation of such Team Sale and June 30, 2010 with respect to any Glendale Contracts that,
prior to the consummation of such Team Sale, have not either expired (without renewal), been
terminated with the consent of all parties thereto or become Assumed Contracts in accordance
with Section 2.14, less (v) any Indebtedness of the Buyers not included in clause (iii) above that
is outstanding at the time of consummation of such Team Sale and is not assumed by the
purchaser in such Team Sale, less (vi) fees and expenses (including attorneys' and accountants'
fees and expenses) incurred by the NHL or the Buyers in connection with such Team Sale, not to
exceed $1,000,000. For the avoidance of doubt, the calculation of Net Profit shall not include (x)
any relocation fees or other payments made directly to the NHL or to the Member Clubs in
connection with any Team Sale, (y) more than $2,000,000 in fees and expenses (including
attorneys’ and experts’ fees and expenses) incurred by the Buyers, the NHL and any NHL Entity
or Affiliate thereof in connection with the Bankruptcy Case or this Agreement, or (z),
notwithstanding clause (y) above, any fees and expenses (including attorneys’ and experts’ fees
and expenses) incurred by the Buyers, the NHL or any NHL Entity or Affiliate thereof in
connection with litigation that is not directly related to the Bankruptcy Case or this Agreement
(including, without limitation, any litigation based on alleged antitrust violations).
Still my favorite. I was prepared to shred my degree and open a bead kiosk at SFO if that claim actually came forward.
CF, I was at SFO last week. A person approached me with an offer to sell a strand of beads. I asked how much and he replied, "I'm not sure. Bead markets have changed dramatically in the past 45 days." I then tried to pull up Phoenix XXIV on my mobile to find out who made the bet and what the terms were. By the time the thread loaded, he had disappeared. I felt like I was oh-so-close to meeting someone from this thread, now I realize it was you (except it wasn't).
OK, I made all of that up except for the part where I was at SFO last week. Sadly, the bead thing did enter my mind.
At any rate, I'd love to see the sharp legal minds at the CoG go after the league on this one. We'd be up to 100,000 posts in no time.
CoG has walked into each stage of this transaction willingly, and has signed their rights away in the process. Of course they could still go ahead and sue, and get sand kicked in their faces by NHL counsel. Highly entertaining for anyone except a resident of Glendale.
I believe you are referring to Specific Performance. The original Moyes AMULA contained that language. (ie- the Coyotes must play all home games in Jobing.com Arena for the period of 2004 to 2034). That contract was rejected during the bankruptcy case.
Subsequently, the NHL signed an AMUL. The NHL ensured that there was no specific performance language in the new agreement. Further, they wrote language that outlined their right to relocate the team.
Contractually, the owner (whoever it is) has the right to move the Coyotes anytime after the conclusion of this season (technically, it's either 5 or 10 days after the end of the season, I forget which). From here, I defer to KDB regarding the NHL constitution and bylaws for moving franchises.
I wan'nt aware of that but, like in Canada, many of these obligations were probably sort of extinguished by the bankruptcy.
Well, as we've seen those rules are.... shall we say.... flexible to say the least? i don't have time at the moment to search it out, but last years move of the Thrashers would have been against a few provisions that are in there. The BoG has a great deal of flexibility to suspend the provisions of the constitution as they see fit I seem to recall. Dammit, there goes my evening now reading the darned NHL constitution....
Seems flexible..
There are a few points in the constitution that have " as he deems appropriate " or " may at anytime elect " or " as may be decided by the league".
I haven't done a thorough read of the posts lately. I stop by, every couple days, to see if anything has changed. Nothing ever has.
However, the tone of the posts has gone from Pro Glendale last week to Pro Relocation this week. Did anything actually happen or is it just the usual to and fro?
Trusting Rejean Tremblay with this issue, is like trusting Sean Hannity reporting on something about Obama.
Even our Seattle reporters where the 1st to break the news that Jamieson is very close to closing the deal. I don't think QC reporters would ever say that, even if it was true.
Well he gets his infos from PKP himself. You cant get more direct info then that. If PKP is saying that, dont you think he got that info from Daly or Bettman himself.
CF, I was at SFO last week. A person approached me with an offer to sell a strand of beads. I asked how much and he replied, "I'm not sure. Bead markets have changed dramatically in the past 45 days." I then tried to pull up Phoenix XXIV on my mobile to find out who made the bet and what the terms were. By the time the thread loaded, he had disappeared. I felt like I was oh-so-close to meeting someone from this thread, now I realize it was you (except it wasn't).
OK, I made all of that up except for the part where I was at SFO last week. Sadly, the bead thing did enter my mind.
At any rate, I'd love to see the sharp legal minds at the CoG go after the league on this one. We'd be up to 100,000 posts in no time.
CoG has walked into each stage of this transaction willingly, and has signed their rights away in the process. Of course they could still go ahead and sue, and get sand kicked in their faces by NHL counsel. Highly entertaining for anyone except a resident of Glendale.
The league's attorneys are where I had my first job out of law school Skadden. While Glendale could compete with Skadden, they would be wise to seek outside counsel with resources to match.
The difference is that the league's attorneys would throw 15 associates and 3 partners on a given problem and would have some on the midnight shift researching. Btw these are what I like to call blue collar partners, folks who are up at 3AM drafting motions and Crap.
Well he gets his infos from PKP himself. You cant get more direct info then that. If PKP is saying that, dont you think he got that info from Daly or Bettman himself.
No, or he's interpreting what he wants to hear (PKP) and not what's actually being said to him.
I wan'nt aware of that but, like in Canada, many of these obligations were probably sort of extinguished by the bankruptcy.
Thanks for all, lots of things to read!
Bankruptcy courts have the ability to take a number of actions, but it's really what the bankrupt entity wants and proposes in its re-org plan.
Best example, a good client of mine went through bankruptcy twice and is self insured to the tune of 500k. First time emerging from bankruptcy it was business as usual with tort claims. Second time, claims were capped at 2.5 cents on the dollar. Tons of plaintiff's attorneys are p'od but that's life.
It's really what's listed in the re-org plan that will open up a bigger picture.
I for one hope that this team does not relocate to Quebec city.. For hockey to grow you need to have a few generations in a city for it to be a part of everyone's collective psyche. Of course you need to win too.
Besides I'm kind of upset that the Quebec government is giving tax money to Quebec and just left the expos for dead. A team that put montreal on a North America map and my favourite NL team.
Also some posters from QC are just sharks circling the coyotes situation as prey. It's like they forgot how it felt to lose a team. I don't see bettman and co sending another team to Canada consecutively.
While Glendale could compete with Skadden, they would be wise to seek outside counsel with resources to match.
I cant see them doing that unfortunately. Skadden if Im not mistaken was covered in a documentary posing as fiction starring Pacino & Cruise no?.... then there was the late great Greg Giraldo who worked there before retiring to the comedy circuit, featured on the Lazyboy video "Underwear goes on the inside of Your Pants". Ghost writer on ComedyCentrals "Roasts", my favorite being the one about William Shatner being "more bloated than a body pulled out of the East River... Priceline pays him in Empanadas"... but I digress. So no Sir, if material like thats not good enough for Skadden Id be worried about what theyve' got in the Locker Room warming up.
I for one hope that this team does not relocate to Quebec city.. For hockey to grow you need to have a few generations in a city for it to be a part of everyone's collective psyche. Of course you need to win too.
Besides I'm kind of upset that the Quebec government is giving tax money to Quebec and just left the expos for dead. A team that put montreal on a North America map and my favourite NL team.
Also some posters from QC are just sharks circling the coyotes situation as prey. It's like they forgot how it felt to lose a team. I don't see bettman and co sending another team to Canada consecutively.
I for one hope that this team does not relocate to Quebec city.. For hockey to grow you need to have a few generations in a city for it to be a part of everyone's collective psyche. Of course you need to win too.
Besides I'm kind of upset that the Quebec government is giving tax money to Quebec and just left the expos for dead. A team that put montreal on a North America map and my favourite NL team.
Also some posters from QC are just sharks circling the coyotes situation as prey. It's like they forgot how it felt to lose a team. I don't see bettman and co sending another team to Canada consecutively.
I for one hope that this team relocate to Quebec city. For hockey to grow, you need a solid fan base, people who are totally devoted to their national sport, people that will fill your arena despite your team is loosing games after games. This will assure the whole league solid tickets revenues allowing the league to make this wonderful sport more and more known where it's unfortunately not.
Besides, I'm kind of upset that people from other provinces who are not paying a single cent from their pocket for this project but who will see new revenues brought in to their federal gov can criticize a decision that not only is not their business, but will bring new revenues to their own province via the fed fov. As former die hard Expo fan, I am happy now that the Qc gov. did not pay a new ball park for the Expos because they would probably have left anyway. Does this mean I am less sad? No.
Who is a human being to judge another one on the sole basis of little 5 or 6 lines they post not even in their own language?
I cant see them doing that unfortunately. Skadden if Im not mistaken was covered in a documentary posing as fiction starring Pacino & Cruise no?.... then there was the late great Greg Giraldo who worked there before retiring to the comedy circuit, featured on the Lazyboy video "Underwear goes on the inside of Your Pants". Ghost writer on ComedyCentrals "Roasts", my favorite being the one about William Shatner being "more bloated than a body pulled out of the East River... Priceline pays him in Empanadas"... but I digress. So no Sir, if material like thats not good enough for Skadden Id be worried about what theyve' got in the Locker Room warming up.
A lot of suits involving the league have Skadden arps listed as counsel.
They have the cash to pay. Might I add they were the league's attorneys during the bk sale.
No, or he's interpreting what he wants to hear (PKP) and not what's actually being said to him.
... makes sense to me, Quebec City is the only city with a confirmed new arena and an owner that actually been talking with the NHL that would be ready for the Coyotes to move to.
I for one hope that this team relocate to Quebec city. For hockey to grow, you need a solid fan base, people who are totally devoted to their national sport, people that will fill your arena despite your team is loosing games after games. This will assure the whole league solid tickets revenues allowing the league to make this wonderful sport more and more known where it's unfortunately not.
Besides, I'm kind of upset that people from other provinces who are not paying a single cent from their pocket for this project but who will see new revenues brought in to their federal gov can criticize a decision that not only is not their business, but will bring new revenues to their own province via the fed fov. As former die hard Expo fan, I am happy now that the Qc gov. did not pay a new ball park for the Expos because they would probably have left anyway. Does this mean I am less sad? No.
Who is a human being to judge another one on the sole basis of little 5 or 6 lines they post not even in their own language?
You can't grow hockey in a little over a decade with a crap team for the most part. When this team was playing at US Airways center they had enthusiastic fans. What's Quebec going to give the NHL in a long run? Sell out attendance is one thing but how about growth? The fact that they will be close to infringing on the habs territory and that team at any generation could be looking for a new owner. How many times have the Molson family owned the habs?
It's like the senators no one cares about them. If this team moves than I would prefer it move to seattle personally. The Pacific NW is vacant of NHL team and it helps with travel. Also there is more room for growth rather than quebec city.
There may be an entirely different sleight of hand going on.
To date, Glendale has refused to allow a study that would determine the cost of operating the arena. At this time, the arena manager is Arena Newco LLC, an entity owned by the NHL.
What would prevent Glendale from asking the NHL (via Arena Newco, LLC) to provide the cost of operating the arena for the last two years? In that scenario, the NHL would be free to make up any number they wanted since Glendale refused to allow an independent source to estimate the cost. If would be cumbersome to disprove whatever amount the NHL floated out there, no matter how absurd it sounded.
The City Council could then say "well, it costs $x to operate the arena whether the team is here or not. We might as well pay that amount to the team and have them stay!" Then just write the NHL's preferred amount into the budget book, bang the gavel, and call it official. The subsidy is nested into the arena management cost that the NHL themselves provided. Glendale conveniently looks the other way at the blatant conflict of interest in letting the league be the sole source of providing arena management costs.
Goldwater: "The arena management fee is grossly disproportionate!"
Glendale: "Your Honor, we obtained the arena management costs directly from the arena manager so we know the amount is legitimate."
Actually, I would be okay with this, speaking as someone who doesn't pay taxes or receive public services from the City of Glendale. If they want to overpay for a service, and they are transparent about how they have done this with their citizens and city councilors, and it is not judged to be illegal, then go for it. Citizens can decide if they want to subsidize an NHL hockey team. The current budget negotiations are also making it clear that the mayor and some city councilors are also keen on knowing the financial implications of subsidizing NHL hockey in Glendale. If they are satisfied with a bogus estimate from Arena Newco, and they can convince citizens of Glendale that they have done due diligence to justify the cost, then that's how the system should work.
The problem I have had is that in the past the city administrators and city council have been deliberately misleading the public about the previous agreements and the financial impacts. The GWI is going after them on this, based on their legal requirement to release public records. Whatever you think of the GWI, it seems perfectly reasonable for a public interest group to challenge the municipal government if they think that they are misinforming the public or withholding information that the public should see. "Take it to the judge".
Regarding the "gift clause", the COG tried to complete a lease agreement with Hulsizer that they thought would skirt the "gift clause". Fair enough, but they were called on it by a public interest group, and they folded their tent and walked away. That was their choice, but it's hard to be convinced by their argument that it was a legitimate deal since they had no interest in defending it in court.
