For the bullet summary, please go here.
We, the hockey fans that came a long way deserve a better fate than what appears on the surface. We the fans have been heard, we just don’t know it yet. The impact we have had on the NHL has been far-reaching, and now the league needs to come up with a ‘creative way’ to save face. Oh, how to do it? Well, what you are about to read is a theory of the ending, explained by the entire picture, and what must have been discovered…..read on my friends……
The ties that ‘bond’
Questions – there are so many.
The decision that came down in court yesterday was so strange, that the only thing stranger was the reaction from the parties involved. Did anybody catch this too?
The case that took five months to settle, that jokingly could have been ruled in a week (based on the result), ended abruptly. Or, did it?
People on this site might consider me the eternal optimist and write off what I’m about to say. Well, give me a chance. Read, and let it absorb for a while, and then piece the puzzle together before you judge my theory.
Hamilton may be closer to getting an NHL team than you may know, and there may be a deal closer than we might think.
There are several ‘out of character’ comments that strike the ‘strange cord’ from the fallout of the ruling from yesterday. The good news, and a big issue here, is it appears the NHL might have to mirror the Balsillie bid in money, and that would mean Jerry Moyes would get what he would have gotten with a PSE victory. That, of course, will be up to the NHL to determine if they are willing to fulfill the court’s requirements, but there is strong reason to believe they will.
So, the bankruptcy case will have solved Jerry Moyes’ issue, and that’s huge. But did it also do something significant for Jim Balsillie?
Let’s start by looking at the facts, from the ‘reaction’ front to try to figure this out.
Amongst the very strange comments made after the decision, here are the strangest in my opinion:
- Jim Balsillie commenting that it’s over. He will not seek appeal. This is out of character for a persistent man that looked like he was building an anti-trust case during the trial. So, now, it’s over?
- The NHL’s only comment yesterday, was that it was pleased that the court ruled in it’s favor, and that the league has the right to choose who owns the franchises.
- Jim Balsillie saying hockey is closer than ever for Hamilton? Wait a minute Jim just lost, remember?
- Jim Balsillie saying he will be first in line to buy tickets? (Sell them you mean, don’t you Jim?)
- Tom Harrington reporting on the case in the one breath telling us Balsillie lost, and in another stating that Jim Balsillie could be considered for an expansion team (see video)?
Out of character indeed. Strange? Absolutely.
Jim Balsillie has been a pitbull in his attack of the NHL, it’s processes, and it’s good boy’s club.
Suddenly Jim,’ the pitbull’, puts his tail between his legs and goes home? No, no, no. Sorry, not buying it.
What I can “buy” is the fact that there were many months the Balsillie legal team was looking into the workings of the NHL, and without telling you all I know (it would go against something I promised someone), I can tell you this much.
As mentioned on several occasions, there are things I see from a site owner perspective to give a good indication of things that might not be seen otherwise. That is how the initial investigation started at the outset, and fittingly, how it has ended. Patrick Romanoski is the only other person I have shared my information with, and we are, well, sworn to keep it to ourselves.
But, at the same time, I feel the need to share it with the people of Canada, because we have all been in this together, fighting along with Jim, and now suddenly, it’s lunch bag letdown time. No, I am here to tell you the facts speak a different language. The ruling of ‘no sale’ was likely by design.
How it began is how it ended
A strange ‘hit’ to the site many months ago that got the ball rolling, and a few recent ones might have effectively ended it.
The situation in Glendale began years ago as a case of a city needing growth. The city as we know is Glendale.
They decided to bite the bullet and attack sports facilities as a means to attract residents, build the tax base, and otherwise thrive.
Glendale had quickly become the location of choice for the Arizona Cardinals and the Phoenix Coyotes. The common denominator – Michael Reinsdorf and International Facilities Group (IFG).
While IFG was quick to tell us that they constructed the Cardinals’ stadium, they also were responsible for the construction of the now Jobing.com arena.
While IFG was responsible for aspects of consulting on the Cardinals’ stadium, they strangely backed off dealings on Jobing.com arena, and instead brought in Beacon Sports to assess and give advice to the City of Glendale. That, in itself seemed a little strange. That is, unless the company needed to have a non-arms length relationship with Jobing.com and the city.
Michael Reinsdorf, as I pointed out, professes to be an expert in lease negotiations. So why didn’t he get involved with the lease between Jerry Moyes and the City of Glendale?
It never really made sense, and we, as the public know who several key creditors have been in this bankruptcy, but let’s ask the obvious question. How come we do not know who the bondholder is?
Well, I suppose the bondholder is once removed from the situation. That is, the bond is a deal between the City of Glendale and the bondholder. It is only the lease that is the issue between the hockey team and the City, and only that forms part of the financial obligations in this case. So, who holds the bond, although huge, is not directly a party to the bankruptcy.
But, as mentioned several times, the ‘ah ha’ moment would be to know who holds the bonds?
Glendale has sold out to private investment money to fund infrastructure growth. They built Jobing.com arena with no money down, but with a huge promise to come through with sales tax, to fulfill the bond terms. The only way to generate sales tax, is if you have tenants to bring the people in.
In this case, the hockey team is a condition of the bond terms, and revenue from sales tax the agreement.
We on Make it Seven have recently surmized that the NHL may have been involved with the arranging (convincing) of the City to take on the loan structure, and in effect the NHL may have been a party to being on the hook to meet the bond’s obligations.
Now, in the judge’s ruling of yesterday, is it clear that the NHL actually got the one-year out clause it was looking for?Again, I don’t believe it was clear at all. And, in fact, a lease concession of that huge a magnitude is simply a concession that I do not believe the City of Glendale is at liberty to allow. The Goldwater Group would see to that.
So, if indeed the NHL, by assuming this team would be on the hook for the close to $800 million lease liability, why would they take the deal? Unless they too are bound by it.
Remember again, the NHL philosophy is first you need a state of the art arena, and then a team, and then the fans will come (they hope).
Well, as we know in Glendale, we have a location where it is inconvenient for so many people to make it on time for a game, that many have likely elected to forget it. The location for the state of the art facility was wrong. But, the NHL, and the hockey team have been held accountable for it.
So, we have Jim Balsillie.
For Jim, all guns were ablazing for several months, and his desire to obtain an NHL franchise flew in the face of the NHL itself. But, at some point, would this strategy fail?
The answer is yes.
The court has proven it.
Why would Jim back down now? Why not antitrust? He could continue to make the life of the NHL and it’s executives a living nightmare for years to come. God only knows he has the financial wherewithall to do it. So why back off? Good question.
Here’s where the theory comes in. What if the PSE legal team found out something so juicy, it would make everybody stand up and take notice. A lot like the NHL, the City of Glendale, and a developer all coming to this site one day, when I pinned the tail on the donkey, and determined Jerry Moyes was taken for a ride. Bingo.
Well, I think there was a second ‘Bingo’ moment, and I believe that PSE found out a very important fact.
The fact: Who holds the Jobing.com arena bonds?
If PSE and it’s team of lawyers were able to find out who holds the bonds, and it ties in with the suspicion of collusion nicely in this case, as the basketball announcer would say, “Get out the salami and cheese mama, this game is over”.
Well, I have reason to support the idea that in the last little while a break occured in this case, and PSE was able to do just that. I believe they found out who holds the bonds, and the situation, even to PSE became clear.
Jim Balsillie, not being the bad guy he was painted to be probably realized the significance of the finding, and also realized that it would not be good for certain parties to this bankruptcy. After all, we are all human, and who would have known it would come to this?
So, having information of significant magnitude, a deal could have been made. A deal that would work for everybody.
Instead of the prolonging of the facade of “character assasination” of Jim Balsillie, the game could now end.
The judge could look like the bad guy. The league, if it comes back to a ‘given up’ Jim Balsillie, a good guy.
Jim Balsillie was never going to get into this league by continuing to make the NHL and it’s people eat crow.
At some point he would have to back down. But, he may have enough clout now to have harboured a deal.
To put the finishing touch on this idea, let’s remember how badly the NHL wants to get this team out of bankruptcy.
Remember Ice Edge? The comment form Daryl Jones being they would only have an opportunity to buy the team “post bankruptcy”?
Why post-bankruptcy? Why not during bankruptcy?
Well, in bankruptcy, Jerry Moyes knew that the league would not be able to change loan terms, specifically bond terms.
But, if one of the parties to the collusion were to also be the bondholder, then out of bankruptcy, the bond payment terms could be made a lot easier on the City of Glendale, and maybe, just maybe the financial situation of the Coyotes in Glendale might have a chance.
The issue is this.
If the NHL is bound to remain in Glendale legally for the remainder of the lease, then they need to do all they can to find an owner. The bondholder would be motivated to ensure the stream of payments is maintained.
Judge Baum, appearing as the indecisive judge, cared less about his reputation, and in the end more about Jerry Moyes than we might appreciate. After all, Jerry Moyes will get his money here.
The Coyotes might stay in Glendale.
The NHL will still have one heck of a rough ride.
And, Jim Balsillie will have found out enough information to keep quiet, that when he goes to buy those tickets for hockey in Hamilton, he might actually turn around and sell them.
That’s right, he just might be made an offer that comes from a very generous league. A league that will look like good guys for having a change of heart.
A league that might offer Jim Balsillie an expansion franchise, as suggested oddly by Tom Harrington. What is striking about the comments by Harrington, is that the league was very “low key”, and that they cited Hamilton as the 5th best market in potential. Harrington said there may be opportunity for Hamilton, “and Jim Balsillie.” Now is that strange or what, especially coming off a bitterly contested battle? This is certainly not in keeping with previous atttitude or demeanor of both sides – the NHL or Jim Balsillie.
As Philip Mastronardi said so well:
…..something isnt right, I dont know what it is but i get the feeling things are far from over.
Phillip Mastronardi | | Oct 01, 12:52pm
Others are also getting the “feeling” this is not in keeping with the tone or the situation. “Something just isn’t right” alright, so what is it?
Well, I am here to say that information is power, and I believe there are secrets best kept secret in the NHL. And, keeping things quiet might just be worth a lot.
So, what’s not right?
We all know Jim Balsillie never, ever gives up! So why is he giving up now?
I think this tweet I found last night summarizes the bond albatross situation with a light heart:
Perhaps the reality of being ‘stuck’ with the albatross lease is playing into the thinking of the NHL, yet again, as Bill Daly had this to say:
“We are pleased that the Bankruptcy Court has confirmed the League’s rights to select its owners and the location of its franchises. We are reviewing the opinion and considering how we can best address the Court’s concerns regarding our offer to purchase the Coyotes. It remains our goal to secure the long-term stability of the Coyotes in Glendale.”
Yep, the ‘bond’ that ties likely is better tying someone else up, right Jim?