NHL Claims vs. ex-Coyotes owner tossed [by Bankruptcy Court, J Baum)

TheLegend

Megathread Gadfly
Aug 30, 2009
35,925
27,389
Buzzing BoH
Refresh my memory. Did the NHL receive two full $25 MM payments, and then has the third installment of $20 MM to be paid out over the next five years?

There were just two $25M payments pledged.

They originally paid out the first $25M for the 2010-11 season. For 2011-12 they agreed to pay another $25M, but had only placed $20M of it into the escrow account. The NHL never submitted a claim for that second $25M after the 2011-12 season for reasons only they know. The Yotes made the WCF that year which may have cut down on losses (if any, I don't recall anything being reported).

But then the CBA talks, lockout and short season came after that and the NHL negotiated a "month to month" AMUL agreement with Glendale (with the city not having to pledge anything for it).

The NHL was still entitled to make claim on that second $25 million since $20 million of it was still in escrow. They chose to offer the installment route as a way to facilitate the deal with IceArizona.
 

GuelphStormer

Registered User
Mar 20, 2012
3,808
497
Guelph, ON
They repay the loan to the NHL; and the NHL pockets any relocation fee associated with a relo sale.
i guess that's the generally idea, but i am at a loss to understand how the NHL could ever possibly become whole on this ...

a) that $85M (?) operating loan is not costless. the nhl has borrowed it on its BoA, LoC and then in turn is loaning it to IA. the nhl has carrying costs on that loan. any actuaries? is that $5M in interest over five years? $10M? and really, who actually expects IA to be possibly be able to repay the $85M principle. "oops", says gary.
b) guaranteed full profit sharing for IA with no requirements will cost all other owners now, especially those that would otherwise qualify for that money ... again, what's that? $13M/year = $65M over the next five years? more? "ouch", says florida, tampa and carolina.
c) legal fees and interest on the original LoC for having held the franchise for this long are not trivial ... as noted in the claim, $15.1M for the lawyers, then plus what in interest these past five years? another $20M = $35M?
d) to be made whole on the contested $112M+ in operating losses, plus the $100M or more listed above would mean a relo fee charged to a new owner would need to be $200M or more. who's able to pay that? on TOP of the purchase price IA would want to have made this whole thing worthwhile. seattle is not likely to pay anything close to $200M+ in relo, nor is any american city. so unless this team is relocated to quebec city, toronto or possibly hamilton (gasp!), this is going to result in a big net loss for the nhl.

the nhl WILL lose its shirt on this. no question about it. in and of itself, phoenix will cost the NHL a LOT of money. it can however, offset that lose with expansion into other markets.
 

Killion

Registered User
Feb 19, 2010
36,763
3,211
...the nhl WILL lose its shirt on this. no question about it. in and of itself, phoenix will cost the NHL a LOT of money. it can however, offset that lose with expansion into other markets.

.... yes its pretty clear theres some sort of long range plan thats been constructed, executed. The whole thing is beyond convoluted, the numbers simply dont add-up, no idea what the NHL's planning, what the end-game might possibly be. Easy enough to speculate with several possible scenarios but its just too early to tell, what courses theyve charted, where it all winds up.... treacherous waters Im afraid as in speculating, we wind up back on the seas of the Mega Thread. Cant be havin that GS. So for now & at least for some time to come we'll watch, see how the tumblers fall, a clearer picture emerging at some point in time Im sure. Remember though, the league did not apply the $60M from TNSE to paying down its LOC with Phoenix in order to discount the price & facilitate a local sale so applying any future Relo or Expansion Fee's to covering debt attached to this file in the future I would think not likely. Not based on past performance. Just a lot of questions to which only a few know the answers & their not talking.
 

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