Phoenix CIV: May be time to put the band back together ...

[madhi19]

I think it's very likely the July AMF payment gets paid into escrow, and if so that could be a moment of truth for IA.

Fugu has long held the position that IA won't negotiate with Glendale because it has no money with which to negotiate, and I agree with that. As many others have noted, IA probably has every cent spent before it's received.

If IA's one sure thing, the AMF payment is interrupted in a way that disturbs it's debt service, that could be curtains for this act. At that point IA would find out whether the NHL is willing to shovel some money their way to cover things up, as it did with Moyes, or not. If not, see the relo thread.

I expect IA needs to show irreparable harm that can't be compensated in damages to sustain it's TRO. That creates a Catch-22 situation for IA. If it presents evidence that withholding the July AMF would cause irreparable harm because it needs the money to stay solvent, that enhances Glendale's position that the money must be held in escrow pending a determination of liability because there is a significant risk that if Glendale wins it will have dry judgment. So, the harder IA pushes on "irreparable harm" with respect to the next AMF payment, the worse their case gets. Conversely, if IA doesn't show irreparable harm then there's no reason to upset the "balance of convenience", which is to pay the money into escrow.

They're damned if they do and damned if they don't.

It might turn out they're just plain old damned anyway, with Tindall's hiring and his emails and all anyway.

IA best outcome would be to lose really quickly, or drop the suit. Winning quickly get them nowhere because Glendale would appeal.
Anything else for IA will see the NHL increase their debt to prop them up, with no guarantee of winning.

I was under the impression that Barroway's entry into the "band" had relieved them of the franchise acquisition debt. Am I mistaken?

If they still do have this obligation and can't come up with the cash, then any suggestion that his ownership group could do anything other than opt out of the lease at year 5 is pure fantasy. Maybe someone forgot that Glendale had previously been misled by the Ice Idiots with respect to their financial wherewithal.

It the NHL who own all or almost all of IA debt now, in a way it simplify matters.

 

[Ciao]

I was under the impression that Barroway's entry into the "band" had relieved them of the franchise acquisition debt. Am I mistaken?

If they still do have this obligation and can't come up with the cash, then any suggestion that his ownership group could do anything other than opt out of the lease at year 5 is pure fantasy. Maybe someone forgot that Glendale had previously been misled by the Ice Idiots with respect to their financial wherewithal.

Whilee, I was so naively impressed when I heard that Borrow-way used his own US$150,000,000.00 to invest in the Arizona Coyotes. Here, I thought, is the end of the ownership saga and the beginning of the long-term success of the franchise.

Little did I know how sadly mistaken I was.

If Borrow-way didn't plunk down a big piece of change, then in one way or another that oppressive Fortress debt will still be out there. Someone else might own all or part of it, but whatever debt instrument that was used to give security will not have been retired. Someone somewhere will be expecting payments that can only be made if Glendale continues paying under the AMF.

I think this is one of those problems that is not going to go away.

 

[CasualFan]

I was under the impression that Barroway's entry into the "band" had relieved them of the franchise acquisition debt. Am I mistaken?

The only known information is that FIG/Glendale filed a release of deed of trust with the Maricopa County Recorder's office on Jan 29, 2015. Everything other than that is speculation.

 

[MNNumbers]

The only known information is that FIG/Glendale filed a release of deed of trust with the Maricopa County Recorder's office on Jan 29, 2015. Everything other than that is speculation.

And this is something I have repeatedly asked about, with no answer forthcoming....

The idea behind Barroway taking 51% of the ownership was to allow IA to use the NHL's LOC with Citiback (I think it was). As a US citizen, he pays no income tax on that. For the Canadians, the Canadian Tax Office (whatever it's called) would consider that income, coming from a US institution. And, that is a big problem, because the rate inflicts them with greater losses.

All of which seems great. Combined with the proven retirement of the FIG loan, we are left with this question.... Assuming the BOG confirm the decrease of Barroway's shares, IA becomes again a Canadian-based organization. What happens to their loans now? It seems they have great tax liability, because their operating loan comes through the NHL LOC.

Unless, that is, that the League simply extends the funds themselves. In which case, it becomes even more evident that the league really still owns the team, regardless of what Bettman says.

 

[CasualFan]

Whilee, I was so naively impressed when I heard that Borrow-way used his own US$150,000,000.00 to invest in the Arizona Coyotes. Here, I thought, is the end of the ownership saga and the beginning of the long-term success of the franchise.

Little did I know how sadly mistaken I was.

Seems like a pretty big stretch, doesnt it? Well, unless you're Craig Morgan. Then it makes perfect sense to put a $300MM+ valuation on a business that's in debt up to its eyeballs and suffering 8 figure losses each year. Maybe the reason so many laypersons struggle to understand this matter is because they're being feed plates of horsecrap from the Coyotes propaganda team?

 

[Tom ServoMST3K]

We're on a mission from COG!

3,2,3,4,4,2,3,4

"These men are pawns"

 

[Fugu]

The only known information is that FIG/Glendale filed a release of deed of trust with the Maricopa County Recorder's office on Jan 29, 2015. Everything other than that is speculation.

It was confirmed that the FIG loan was paid off but supplanted by the LOC-- better terms, max per team is $120-125 MM, iirc.

 

[MNNumbers]

It was confirmed that the FIG loan was paid off but supplanted by the LOC-- better terms, max per team is $120-125 MM, iirc.

Please see my above post and verify my reasoning, if possible...

 

[Fugu]

And this is something I have repeatedly asked about, with no answer forthcoming....

The idea behind Barroway taking 51% of the ownership was to allow IA to use the NHL's LOC with Citiback (I think it was). As a US citizen, he pays no income tax on that. For the Canadians, the Canadian Tax Office (whatever it's called) would consider that income, coming from a US institution. And, that is a big problem, because the rate inflicts them with greater losses.

All of which seems great. Combined with the proven retirement of the FIG loan, we are left with this question.... Assuming the BOG confirm the decrease of Barroway's shares, IA becomes again a Canadian-based organization. What happens to their loans now? It seems they have great tax liability, because their operating loan comes through the NHL LOC.

Unless, that is, that the League simply extends the funds themselves. In which case, it becomes even more evident that the league really still owns the team, regardless of what Bettman says.

NHL lists itself as the majority owner? IA, Borrow-Away et al. are minority stake holders as far as the bank is concerned?? Unless IA was able to clear that bit with the Canadian tax agency.

 

[cbcwpg]

Unless, that is, that the League simply extends the funds themselves. In which case, it becomes even more evident that the league really still owns the team, regardless of what Bettman says.

I guess it doesn't matter, but I believe....

No one has ever actually bought the team from the NHL. Which is the same as you saying "the league really still owns the team", but sounds more conspiracy-ish my way.

In seriousness though, I think that "maybe at times" other individuals or groups of people have indeed owned the Coyotes in the sense that they were approved by the NHL as owners, but the money train that these so called owners are relying on never arrives at the station. So the team falls back to being technically owned by the NHL, at least partially, or at least by the fact the NHL has loaned out money for the purchase.

This has gone on so long I lose track... But whomever has the loans owns the team until the loans are paid off, don't they?

 

[Killion]

Interesting that BOG meetings and schedule release are set for dates before the NHL will know if the AMF is going to the team or escrow. Tough spot for the league on that one. Good luck, fellas.

The NHL may have been exploring relo plans as early as 6/2/2015 based upon specific information that they received out of Glendale that the lease was going to be cancelled.

Yeah, real tough spot the NHL finds themselves in, and yes, as early as 6/2/2015 however I think it pre-dates earlier this month & by a couple of years. Quebec. On stand-bye. Full Aluminum Jacket perhaps, thing is, circumstantial, anecdotal & physical evidence overwhelming. At least to me it is....

I think it's very likely the July AMF payment gets paid into escrow, and if so that could be a moment of truth for IA.... So, the harder IA pushes on "irreparable harm" with respect to the next AMF payment, the worse their case gets. Conversely, if IA doesn't show irreparable harm then there's no reason to upset the "balance of convenience", which is to pay the money into escrow.

They're damned if they do and damned if they don't.

Depends on the Judge of course. Why she would want a Muni to pay the funds into escrow at all I dont know. The bar for governmental entities a lot lower than it is for private, for businesses & individuals. Certain trust factor there. She might just decide no, they dont have to pay IA nor do they need to pay into escrow. IceArizona on the other hand.... real smooth move in not responding to the Courts order they drop $250K into escrow. Certainly strengthens the COG's request that they either do so immediately or dismiss the TRO. Pay the $250K plus another $3.75M pls. Reading the Filing, if your adjudicating very good chance your going to be looking at IceArizona through a glass darkly, going along with Glendales request.

Surely the NHL must be expecting IA to lose access to the AMF and then default on its debt service almost immediately thereafter.

Unless the NHL is willing to go back where it started (by secretly underwriting Moyes) it could be a whole lot closer to exercising relocation options than it lets on.

That fits in with your hypothesis as well.

Could well be the plan Mork, yes. Continue the charade, the front. No other choice.

That stupid arrogant ass LeBlanc is probably still wondering what hit him.

.... yes indeedy. hoisted on his own petard. not real bright.

Whilee, I was so naively impressed when I heard that Borrow-way used his own US$150,000,000.00 to invest in the Arizona Coyotes. Here, I thought, is the end of the ownership saga and the beginning of the long-term success of the franchise.

Little did I know how sadly mistaken I was.

Oh boy.... yeah, perhaps just wishful thinking rather than naivete' Mork. Youve seen enough of life that Im quite certain a part of you was screaming "not so fast there Chum".... I certainly didnt buy it. Theres just no way he dropped that kinda coin. Merely a signature. League Sockpuppet. Stooge. Another Bad Actor.

 

[CasualFan]

It was confirmed that the FIG loan was paid off but supplanted by the LOC-- better terms, max per team is $120-125 MM, iirc.

That definitely seems to be the most probable/logical transaction. To my knowledge, that agreement is not publicly recorded though, so there is not the same certainty as there was on the Aug 2013 loan and liens from FIG and NHL.

 

[Ciao]

Seems like a pretty big stretch, doesnt it? Well, unless you're Craig Morgan. Then it makes perfect sense to put a $300MM+ valuation on a business that's in debt up to its eyeballs and suffering 8 figure losses each year. Maybe the reason so many laypersons struggle to understand this matter is because they're being feed plates of horsecrap from the Coyotes propaganda team?

I really would like the Coyotes to succeed, for the sake of Coyotes fans and the city of Glendale both of whom I've taken a shine to. I think I was ready to believe anything that sounded like good news, no matter how improbable, with respect to this entirely improbable mess.

I couldn't believe that the Coyotes were actually worth $300-million, but I was ready to believe some dope might be willing to pay that much -- especially in view of the unrelated LA Clippers sale and all the improvident, improbable and just plain stupid things the City of Glendale has already done with respect to this franchise. I was then able to throw my hands in the air, say "What the heck do I know?" and suspend disbelief.

Then I got a rude awakening to find that Borrow-way had not paid the money I had understood that He had already paid to buy into the Coyotes.

More smoke and mirrors.

The legal process they're facing now is a genuine process that has the potential to bring all the half-truths and fictions that have been spun together into close proximity with reality.

If Glendale is able to shut off the tap it will be very interesting to see what happens next.

 

[Fugu]

I was under the impression that Barroway's entry into the "band" had relieved them of the franchise acquisition debt. Am I mistaken?

If they still do have this obligation and can't come up with the cash, then any suggestion that his ownership group could do anything other than opt out of the lease at year 5 is pure fantasy. Maybe someone forgot that Glendale had previously been misled by the Ice Idiots with respect to their financial wherewithal.

Barneyg and I were discussing what the stake actually represented.

If they set it up simply for him to match the operating capital ($45 MM from IA initially), then their "100% stake" really represents $45MM cash and $170 MM debt assumption.

The FIG portion ($80 MM or $120MM, per Forbes) was transferred to an LOC. The NHL's $85 MM remained.

So it's possible Barroway was supposed to come up with the same amount of cash as IA had infused initially, and assume his share of the debt load. If he's only going to be a 30% holder, that would mean he put in.... $30 MM?

 

[Killion]

"These men are pawns"

Ya, nice indirect multi layered analogy there with Ishtar. One of the biggest flops of all time. Studio suicide.

 

[Tom ServoMST3K]

Ya, nice indirect multi layered analogy there with Ishtar. One of the biggest flops of all time. Studio suicide.

"Next these men will be hailed as the true messengers of GOD!"

 

[GuelphStormer]

I would guess that Jacobs and Snider will bully the rest of the BoG into a full-on, scorched earth response. Nobody's gonna tell the dynamic duo what to do, least of all some backwoods village in the desert.

... fasten your seatbelts, it's gonna be a bumpy fortnight.

 

[cbcwpg]

http://www.theglobeandmail.com/spor...ntrol-so-coyotes-can-survive/article21450346/

http://www.theglobeandmail.com/spor...edit-ruled-offside-in-canada/article22547432/

****

Using these articles and maybe I'm way off base here ....

Is it possible that LeBlanc and friends wanted to use the new NHL LOC to pay off the FIG loan, but couldn't because the CRA ruled that the NHL didn't comply with Canadian government regulations. This would be assuming the the CRA ruling would apply to not just Canadian teams, but Canadian majority owners of US teams as well.

At the same time FIG was getting antsy about LeBlanc's groups ability to pay back the FIG loan, so the brought in Barroway ( who is also a Fortress client ) to take majority ownership of the team resulting in the tax savings of having American ownership, and allowing the Coyotes to now use the NHL LOC and not have to worry about the CRA.

An now IF the NHL LOC was used to pay off FIG ( I guess FIG doesn't care anymore ) and Barroway's majority ownership services are no longer required, the Canadian owners can buy back some of Barroway's shares, and we are right back where we started.... and Bob's your Uncle.

Canadian's owning the Coyotes ( if they really do that is. ) with the only loan being with the NHL..

 

[MNNumbers]

http://www.theglobeandmail.com/spor...ntrol-so-coyotes-can-survive/article21450346/

http://www.theglobeandmail.com/spor...edit-ruled-offside-in-canada/article22547432/

****

Using these articles and maybe I'm way off base here ....

Is it possible that LeBlanc and friends wanted to use the new NHL LOC to pay off the FIG loan, but couldn't because the CRA ruled that the NHL didn't comply with Canadian government regulations. This would be assuming the the CRA ruling would apply to not just Canadian teams, but Canadian majority owners of US teams as well.

At the same time FIG was getting antsy about LeBlanc's groups ability to pay back the FIG loan, so the brought in Barroway ( who is also a Fortress client ) to take majority ownership of the team resulting in the tax savings of having American ownership, and allowing the Coyotes to now use the NHL LOC and not have to worry about the CRA.

An now IF the NHL LOC was used to pay off FIG ( I guess FIG doesn't care anymore ) and Barroway's majority ownership services are no longer required, the Canadian owners can buy back some of Barroway's shares, and we are right back where we started.... and Bob's your Uncle.

Canadian's owning the Coyotes with the only loan being with the NHL..

This is what I have been asking. But the kicker is, now that Canadians are opening the team again, the interest payment provision that kept them out of the NHL LOC should be back in play, giving a dicey situation again.

If send to me that slowly, IA is being squeezed out, and the COG action is making it go faster.

 

[madhi19]

This is what I have been asking. But the kicker is, now that Canadians are opening the team again, the interest payment provision that kept them out of the NHL LOC should be back in play, giving a dicey situation again.

If send to me that slowly, IA is being squeezed out, and the COG action is making it go faster.

There no good ending for these guys, unless they sell and sell quickly. But will the NHL even allow them to sell?

 

[Killion]

There no good ending for these guys, unless they sell and sell quickly. But will the NHL even allow them to sell?

Their Puppets. Been told what to do & will continue to be so & will do as their told.
Their not calling the shots. A front. Illusory ownership. This team still belongs to the NHL.

 

[Ciao]

. . .
Depends on the Judge of course. Why she would want a Muni to pay the funds into escrow at all I dont know. The bar for governmental entities a lot lower than it is for private, for businesses & individuals. Certain trust factor there. She might just decide no, they dont have to pay IA nor do they need to pay into escrow. IceArizona on the other hand.... real smooth move in not responding to the Courts order they drop $250K into escrow. Certainly strengthens the COG's request that they either do so immediately or dismiss the TRO. Pay the $250K plus another $3.75M pls. Reading the Filing, if your adjudicating very good chance your going to be looking at IceArizona through a glass darkly, going along with Glendales request.

Perfectly logical, K, but payment into escrow or payment into court is almost second-nature in this situation. It preserves impartiality and avoids risk. Neither party has gained an advantage . . . the money is there and prevents the court from looking stupid in case of unforeseen events. Very tried and true. More difficult to appeal as well. I'm doubtful that the Court relieves Glendale of payment entirely no matter how strong the case in advance of a final judgment, but I predict too much of a jaundiced eye to give it straight to IA either.

. . . Oh boy.... yeah, perhaps just wishful thinking rather than naivete' Mork.

Naw, just plain naivete/stupidity here on my part. I know lots of things about litigation -- it's my life's work -- but I really don't know beans about business or finance. I'm a little embarrassed but not too proud to say I was sucked in on this one, hoping and believing it would be true.

 

[IceAce]

Their Puppets. Been told what to do & will continue to be so & will do as their told.
Their not calling the shots. A front. Illusory ownership. This team still belongs to the NHL.

I keep seeing this theory stated here, but I'm not making the connection? What's the basis for this? Because the NHL lent them money, they're now a shell corp?

Do you think they really did this, instead of ya know actually selling to Paul Allen 2 years ago, just so they could continue to bilk more money out of Glendale? That's quite an elaborate mouse trap for a rather small mouse.

 

[Killion]

"Next these men will be hailed as the true messengers of GOD!"

Well, if you wanna go Full Aluminum Jacket conspiracy theory, of Mirages & Desert Kingdoms there was a real beauty floating around back in 2008/09. That financial interests out of Abu Dhabi had purchased large blocks of Glendale Arena Bonds, that they'd further been involved in a myriad of other real estate & development deals with NHL insiders including AEG with facilities in the Middle East, South Africa, the UK, Europe & Scandinavia and so on & so forth. Only reason the NHL fighting so hard was to protect these interests & investments otherwise interests elsewhere could wind up being pulled. This "theory" of course included all kinds of mutual political connections & just on & on & on. That it was all being kept quiet in the wake of 9/11 & the War on Terror, massive investments being made throughout the US and.....

 

[TheLegend]

I agree with you. Anyone who buys even just one ticket is supporting the team. This is not on the fans, it's on the team for failing to draw more fans. Existing fans can only attend as many games and dig as deep as their own pockets allow.

That said though, I still see IA's decision not to raise prices immediately when they bought the team in 2013, right at the one unique time when they could have actually gotten away with it, as the single worse decision they made ... and it signalled to me that they were simply not serious about succeeding and/or not intellectually equipped to succeed. .... which further suggests to me that Bettman knowingly allowed a bunch of dunces to babysit while he continued guiding all the pieces of his master plan into place. Unfortunately, CoG threw a huge monkey wrench into that plan.

IA did raise prices. It was one of the subjects LeBLanc touched on in the beginning. Whether it wasn't enough.... or soon enough certainly is open to debate, but they did warn the fan base it was coming and people understood that.