Judge Approves Sale Of Coyotes

((HT: TSN/

Judge Redfield T. Baum agreed to sign the sale order to the NHL on Monday after lawyers made minor modifications to the deal.

None of the changes significantly altered the NHL's agreement to pay about US$140 million to buy the team from owner Jerry Moyes.

The only party who didn't join in the agreement is former coach Wayne Gretzky, who owned a small portion of the team. However, Gretzky did not file a formal objection with the court.

As part of the deal, the league will reduce the amount of money it says Moyes owes it from $30 million to $15 million.

The sale leaves about $11.6 million that could be divided among Moyes, Gretzky and Glendale, but that figure is expected to drop by a few million when attorneys' fees and other administrative costs are subtracted. It is expected to take several months to determine the exact payouts.

Under the purchase agreement, all the unsecured creditors would be paid except Moyes, Gretzky and Glendale ((jobing.com Arena is pictured, thanks Getty Images)). The largest secured creditor, SOF Investments, will get all of its $80 million, either in cash or over time in an agreement with the NHL.

Those of us at OSG HQ would like to remind everyone that both Ice Edge and the Argos group of Cynamon and Sokolowski are interested in playing by The Bettman's rules for now- and could, probably, pick up the Dogs for a song.

Whoever that group is: Look for them to move the franchise after a few years straight of empty seats in the middle of the desert.

Moyes Agrees To Sell Coyotes To NHL

The sale was announced in U.S. Bankruptcy Court on Monday after attorneys met for more than an hour during a recess in a status hearing on the case.

Former coach Wayne Gretzky, who has a $22.5-million (U.S.) claim in the case, has not agreed to the deal.

Of course, since The Great One wants his cut in their somewhere...

Moyes' attorney says the decision to make a deal came largely because the costs of running the team in bankruptcy were coming out of the league's $140-million offer.

NHL deputy commissioner Bill Daly says that once the deal closes, the league will immediately look to sell the team, preferably to an owner who will keep the club in Arizona.

The meetings Daryl Jones had with the NHL seem somewhat timely, but those of us at OSG HQ still have our money on Reinsdorf.

More when we know more...

Coyotes Have No Re-Gretz Having A New Coach

Since, apparently, Wayne Gretzky was squeezing the Coyotes for all they were worth at every possible angle- and never even signed his contract that was haggled over for years.

((HT: GlobeSports/Waldie, Shoalts))

Through his long-time lawyer, Ron Fujikawa, Mr. Gretzky wound up with a salary of $8-million (U.S.), far more than any other NHL head coach. That came after years of talks in which hockey’s most famous personality demanded such perks as a veto over any potential buyer, a right of first refusal on any offers, and a requirement that the Coyotes continue to pay his salary if he died.

The contentious negotiations were outlined by Jeff Shumway, former Coyotes chairman and governor, and Earl Scudder, one of team owner Jerry Moyes’s lawyers, in declarations filed with the U.S. Bankruptcy Court.

Gretzky thinks he's owed about US$9-million and was set to be paid US$14.5-million over the next two seasons. But he never had a formal employment contract, just a "deal memo" that dates back to 2006.

Fujikawa put in a provision that demanded Gretzky be paid his salary even if he died. Grtezky also wanted to put a bid in on the Coyotes two years ago- for US$120-million, but didn't want any other bids looked at without his first look-see.

Thiose of us at OSG HQ would like to politely ask: Who in the blue hell does he think he is...? But we already know the answer...

Here's ABC15's coverage of the whole Gretzky/Tippett swap out...

Oh, Yeah... About Gretzky...

((HT: TSN))

Wayne Gretzky's status with the Phoenix Coyotes remains up in the air.

The team's coach was not present Saturday morning for the start of training camp.

A spokesman for the Coyotes said Gretzky's contractual situation with the team remains unclear because of bankruptcy proceedings. Assist coach Ulf Samuelsson will run the training camp on a interim basis.

During a hearing in court Friday a lawyer for the NHL said that Gretzky was involved in "delicate negotiations" over his contract.

Gretzky has been coach of the Coyotes since 2005. He makes US$8 million -- far more than any other NHL coach.

Gretzky Shut Out If Reinsdorf Wins Coyotes

((HT: The Star/Hunter))

If Jerry Reinsdorf is successful in his bid for the Phoenix Coyotes, he'll do something most NHL goalies never could pull off: shut out Wayne Gretzky.

Reinsdorf's offer to purchase the Coyotes, filed in bankruptcy court on Friday, excludes the acquisition of several employee contracts, including that of hockey's greatest all-time scorer.

The Great One has coached the team for the last four seasons.

Gretzky, who owns a small piece of the team with majority owner Jerry Moyes, signed an employment agreement in March 2008. It reportedly pays him $8 million (U.S.) a season.

So Gretzky faces two dramatically different fates if one of the suitors that wishes to keep the team in Phoenix is successful at a bankruptcy auction Aug. 5.

He'll either be on the unemployment line or heralded as a Coyote for life.

Another group of Canadian and American businessmen, known as Ice Edge Holdings, wants Gretzky to become a "major shareholder of the newly constituted Coyotes franchise."

In the group's "letter of intent" to purchase the team, which was also filed in bankruptcy court, the group states it intends to offer Gretzky a long-term coaching contract and use him more aggressively to court major corporate sponsorships.

Gretzky to talk in Court

The curious case of the Phoenix Coyotes continues to get more curiouser (not really a word) by the day. In the latest twist, minority owner Wayne Gretzky, coach and minority owner and someone owed money by the team...or at least the bankrupt owner Jerry Moyes.


This issue is far too complicated to get into by a non-lawyer, such as myself; so I will leave it to the fine folks at the East Valley Tribune to explain it here .

As we progress to the end of July and several important dates pop up in regards to the attempted sale of the Coyotes, stay tuned because if history is any barometer, this story has a few more twists left before it finishes.

((Photo Wayne Gretzky looking for his money/Courtesy: East Valley Tribune))

For you entertainment, the first and possibly the last time that Mr. Great One was in a fight ((Courtesy: The You Tube))

Gretzky Trying To Block Glendale Inquiry

((HT: The Star/McGran))

Wayne Gretzky, the most prolific scorer in NHL history, is now playing defence. Legally speaking, anyway.

Gretzky ((pictured, thanks Streeter Lecka/Getty)) launched his first legal action in the bankruptcy case of the Phoenix Coyotes in an attempt to keep his personal finances out of the public eye.

Among a dizzying three days of court documents filed in anticipation of a court hearing Monday, the city of Glendale has asked a bankruptcy court judge to let it have a look at Gretzky's income tax statements.

Gretzky, coach and minority owner of the financially troubled team, is also listed as creditor owed $9.3 million.

The city of Glendale has stated it believes Gretzky is overpaid and wants to strike Gretzky as a creditor. The city believes the money owed to Gretzky is more accurately described as capital in the team.

Gretzky's just-hired lawyers argue Gretzky was improperly served with the city's motion, and his right to privacy should prevail.

"The city has failed to even come close (in its arguments) to justify the massive privacy intrusion it seeks," reads the Gretzky objection. "The city has utterly failed to make any showing that could conceivably begin to overcome the strong presumption in favour of protecting the privacy of the personal, financial and proprietary information sought."

NHL: Moyes Holding Up Coyotes Sale

((HT: CBSSports))

The NHL is accusing Phoenix Coyotes owner Jerry Moyes of trying to derail the sale of the team to a group headed by Jerry Reinsdorf by filing a flurry of requests for depositions before the July 24 deadline for formal submission of the bid.

The league also says another potential buyer for the team has surfaced. The NHL did not identify the would-be purchaser and said in documents filed in U.S. Bankruptcy Court this week that it was uncertain whether the person's interest would lead to a formal offer to buy the club.

Reinsdorf, owner of baseball's Chicago White Sox and the NBA's Chicago Bulls, plans to submit a $148 million offer to buy the team and keep it in Glendale, where the team has lost more than $30 million in each of the last three seasons.

Despite the team's dismal history since moving from Winnipeg in 1996, the NHL contends the Coyotes can succeed in the desert with better management and more success on the ice.

Among those Moyes wants to question are Reinsdorf, NHL commissioner Gary Bettman and deputy commissioner Bill Daly, and Glendale city manager Ed Beasley.

The NHL, in a court filing this week, called the interview requests -- known as "Rule 2004 Motions" under the U.S. Bankruptcy Code "nothing more than Moyes' attempt to frustrate the sale of the Coyotes in Glendale."

While saying little about the purported new potential purchaser, the NHL said Moyes' requests for discovery -- testimony and other evidence -- "is intended to, and may in fact, chill any such bid."

Judge Redfield T. Baum has indicated repeatedly that he has little use for so-called "potential" purchasers until they've made their intentions known to the court.

Moyes backs Canadian billionaire Jim Balsillie's offer to buy the team for $212.5 million and move it to Hamilton, Ontario. Under Moyes' Chapter 11 filing, he would receive $100 million as part of the Balsillie sale.

Moyes could wind up with little, if anything, under the Reinsdorf deal. The city of Glendale, in a court filing, contended the $100 million was not a loan to the team, as Moyes has characterized it, but should be considered equity, thereby removing it as a debtor obligation.

Glendale also has challenged the claims of Wayne Gretzky ((pictured, thanks GlobeSports file)), the team's coach and owner of a small share of the franchise, of $22.5 million under the Balsillie agreement. Court documents have shown Gretzky is paid about $7 million a year, making him one of the highest-paid coaches in sports.

Glendale has filed a "2004 Motion" to get depositions from Moyes and his wife Vickie, Gretzky, and others.

Baum scheduled a hearing Monday to sort out the latest claims in a case that, as of Thursday, had 419 filings on record since Moyes took the team into Chapter 11 bankruptcy on May 5, to the surprise of the NHL.

Baum rejected Balsillie's initial bid to buy the team, citing the inability to meet the June 22 deadline imposed by the Canadian. This week, the judge signed an order setting out a dual track for selling the team.

First, the judge will accept bids to keep the team in Glendale with sale approval scheduled for Aug. 5. If there is no acceptable bid by then, the court will then consider offers to move the team, reopening the door for Balsillie.

Moyes, who considers himself the lead unsecured creditor, is seeking the release of details of Reinsdorf's bid as well as interviews with the parties involved to determine whether it is "a bona fide and good faith offer, and is in the best interest of the estate and all of its creditors."

The NHL characterizes the process sought by Moyes as a waste of time as the league works with the Reinsdorf group and Glendale to develop details of the bid under a tight timeline. The league said that the time for questioning those involved should come after the formal bid is submitted and the details are known.

"Until the Reinsdorf group presents a definitive proposal to acquire the Coyotes in Glendale, it will not only be meaningless to conduct discovery, but it will also waste precious time and resources," the NHL said.

Glendale wants to hold the Coyotes to the terms of the lease to play in Jobing.com Arena, which was built by the city for the hockey team. However, the Reinsdorf proposal hinges on reworking the team's agreements with the city to make it more favorable for the franchise.

That creates a tricky political environment for the city council, which would have to approve any new deal. The conservative Goldwater Institute has sued the city in state court after being denied access to records of Glendale's negotiations with Reinsdorf.

The institute successfully sued the city of Phoenix over subsidies given to developers of a shopping mall. That case is now before the Arizona Supreme Court.

Gretzky Could Lose Up To $10M

((HT: The Star/McGran))

When Jim Balsillie officially applies today to the NHL to move the money-losing Phoenix Coyotes to Hamilton, Wayne Gretzky ((pictured, thanks CBC)) will be watching very closely.

The Great One stands to lose up to $9.3 million (U.S.) if Balsillie fails, according to court documents filed over the weekend.

The same documents reveal the team itself says it's worth only $67 million and has debts totalling $244 million. Part of that debt is $9.3 million owed to Gretzky, making him one of the largest creditors.

Oddly enough, Gretzky had given his blessing to a lesser offer from Chicago sports magnate Jerry Reinsdorf but stands to profit if Balsillie wins the team.

When he kick-started the bankruptcy controversy, Balsillie had promised to pay Gretzky up to $22.5 million as part of his $212.5 million bid for the franchise. That included $8 million to cover payments Gretzky deferred to help the troubled team, and another $14.5 million should Gretzky choose to quit as coach.

"We feel that – by far – we have the business proposal to address creditors," said Balsillie spokesman Bill Walker.

Gretzky is owed the money because he deferred salary to help the team. His claim is listed as "unsecured" and "nonpriority," which means he'd be among the last in line to be paid from the proceeds of a Coyotes sale.

Gretzky has been notably quiet on the sale, but those who know him say he gave his blessing to Reinsdorf, who was putting together an offer in the $130 million range when Coyotes owner Jerry Moyes filed for bankruptcy. Reinsdorf would keep the team in Phoenix.

Balsillie and Moyes will co-apply to the NHL today to move the team, a legal move designed to set up an anti-trust lawsuit should the NHL reject the application.

"NHL bylaws lay out a three-part criteria: owner, market and arena," said Walker.

"We think this bid exceeds all three criteria with a proven business leader as owner, the best unserved hockey market in North America and a state-of-the-art arena renovation."

While Gretzky might profit from a Balsillie victory, there's no guarantee that Balsillie's offer will survive beyond a June 9 hearing on relocation, and no guarantee another offer would pay off all creditors.

The co-chief executive officer of Waterloo-based Research In Motion has threatened to withdraw his purchase if he's not allowed to move the team to Hamilton.

Judge Redfield Baum will hold a hearing next week to determine whether the Canadian suitor has the power to ignore the NHL's constitution, void the Coyotes' lease with the city of Glendale and allow the team to leave Arizona.

Most believe a team that must remain in Phoenix is worth considerably less to potential buyers and might not generate enough proceeds to cover all creditors.

The NHL is owed about $34 million – although the league says the true number is closer to $13 million – as the first secured creditor.

Coyotes Losing Eight Figures In Coming Weeks

((HT: GlobeSports/Waldie))

The Phoenix Coyotes expect to lose nearly $17-million (all currency U.S.) on operations during the next few weeks while the club’s future is determined by a bankruptcy court in Arizona.

The Coyotes filed a budget in court this week as part of their request for emergency financing to get through the Chapter 11 process.

The budget lists weekly revenue and expenses until July 25 and shows a cumulative shortfall of $16.7-million. The club expects to pull in around $275,000 most weeks, reflecting corporate sponsorships and ticket sales to various events at the Jobing.com arena, which the Coyotes manage, according to the filing. Expenses range from $680,000 to more than $3-million during one week as various bills come due.

One of the largest single expenses involves a payment to Wayne Gretzky ((pictured, thanks GlobeSports file)) , a part owner and the team’s head coach.

The budget filed this week includes a line that reads “revenue sharing – WG comp.” There is one payment under that heading – $625,000 this week. An earlier version of the budget filed in court shortly after the club filed for protection showed a second payment of $650,000 during the last week of June. That payment is not shown on the latest budget.

Gretzky paid $1-million for a 1.5-per-cent stake in the Coyotes and was entitled to receive a 14-per-cent cut of any profits, according to documents filed in court. That was a far better deal than other investors received. For example, another investor, Jim Wikert, also paid $1-million for a 1.5-per-cent share but was entitled to just 1 per cent of profits, the documents showed. And John Breslow who spent $2-million for a 3-per-cent stake, was supposed to receive a 2-per-cent share.

It is unlikely that any of them received profit sharing at all because club executives have said in court filings that the Coyotes never made money since moving from Winnipeg in 1996. The club expected to lose $29.1-million on operations during this fiscal year, which ends on June 30, according to documents filed in court.

The NHL has agreed to finance the club during the bankruptcy-protection process. The NHL has already lent the Coyotes $13.4-million under a line of credit set up in February. The Coyotes will continue to draw on that line of credit, which is unlimited, according to court filings.

Canadian businessman Jim Balsillie was going to provide up to $17-million in so-called “debtor in possession” financing when the Coyotes filed for protection on May 5. But the NHL and another creditor objected because Balsillie’s loan would be given priority over other loans. There were also concerns about Balsillie providing financing while also making a bid to buy the club. All sides reached a deal out of court that left the financing in the hands of the NHL.

Balsillie has offered to pay $212.5-million for the Coyotes and move the club to Hamilton. Under his offer, Gretzky would receive as much as $22.5-million. The league has opposed Balsillie’s bid, saying it violates league rules governing relocation.

The budget filed in court also showed that the club pays about $200,000 a week to cover a loan from MSD Capital LP, which manages money for computer magnate Michael Dell. The Coyotes owe MSD roughly $80-million.

The Coyotes have 50 players under contract, filings show, and they have all been paid for the 2008-09 season. The budget shows four payments labelled “player signing bonus.” Three of the payments are in July and are $357,500, $700,000 and $150,000. One payment is in June, $65,000. It is not clear who the money goes to.

Gretzky Backs Reinsdorf Bid

((HT: Damien Cox/Toronto Star))

It was not a good day for Jim Balsillie's public relations offensive.

First, sources indicated yesterday that Wayne Gretzky ((pictured, thanks CBC))is "supportive" of the plan presented by Chicago sports czar Jerry Reinsdorf to buy the Phoenix Coyotes and keep them in Arizona. Gretzky would stay with the team as head coach under the ownership of a group of investors headed by Reinsdorf that would conditionally offer an estimated $130-million US for the troubled Phoenix club.

Second, despite North American economic conditions some suggest are the worst since the Great Depression, Balsillie is reportedly seeking more than $120-million Cdn in federal and provincial handouts to renovate Copps Coliseum if he can purchase the Coyotes out of bankruptcy and bring them north.

According to the Hamilton Spectator, Balsillie would pay the initial $30 million worth of upgrades to the arena, but then get the City of Hamilton to pursue the rest of the estimated $150 million renovation bill with federal and provincial politicians.

Neither Gretzky's support for Reinsdorf nor Balsillie's attempts to get taxpayers to help underwrite his National Hockey League dreams will necessarily have any impact on the Arizona bankruptcy hearings that will decide the fate of the Coyotes starting next week.

But Balsillie had already made it clear he planned to invite Gretzky to be part of the new Hamilton operation. Gretzky has so far declined to make any public comment on the future of the Coyotes.

Balsillie's requests for public money, meanwhile, contradict his image as a champion of free enterprise bent on smashing the "illegal cartel" he has alleged has prevented any other NHL franchises from joining the Toronto Maple Leafs in the lucrative southern Ontario market.

Until now, it was believed Balsillie would pay for the cost to bring Copps Coliseum up to NHL standards without government subsidies.

It's unclear whether Gretzky would retain an ownership stake under the Reinsdorf proposal, which would also include a request for public monies. That offer is conditional on arena concessions from the City of Glendale worth an estimated $15-20 million per season. It's believed Reinsdorf has already negotiated an agreement with Glendale politicians.

While the Reinsdorf bid is less than Balsillie's conditional $212.5-million US offer, it's important to understand Reinsdorf and Balsillie are really bidding on different commodities. Reinsdorf's offer would be for an NHL franchise in Phoenix, while Balsillie's is an offer for a team he could relocate to Hamilton.

Phoenix is not considered a top hockey market, while it's widely believed a franchise based in southern Ontario could be worth more than $400-million US.

The job of the Arizona bankruptcy judge, of course, is to satisfy creditors, not to worry about which offer Gretzky may support or whether public financing is required for any bids.

Next Tuesday, the court will hear submissions on whether the NHL or trucking magnate Jerry Moyes controls the Coyotes.

Balsillie, meanwhile, clearly considers the battle for the hearts and minds of Canadians a priority, which is why he launched a website designed to illustrate support for the concept of a seventh NHL team in Canada.

The RIM executive also offered a series of exclusive interviews to hand-picked media outlets in a bid to get his point of view out to the public. None of the interviews detailed his interest in securing taxpayer dollars to support his venture.

Hamilton city council might consider a lease deal with Balsille tonight. City officials have said they want an arrangement that would keep the relocated Coyotes in Hamilton permanently, not temporarily until Balsillie builds an arena elsewhere.

The league, meanwhile, has steadfastedly maintained it controls the fate of the Coyotes through "irrevocable proxies" negotiated with Moyes in exchange for league financial assistance, and that the team should never have been in Chapter 11 in the first place.

Soon, a bankruptcy judge will have his say on the matter. But Gretzky's support for a plan that would keep the Coyotes in the desert and Balsillie's grab for public money may change the way Canadians view the billionaire's audacious NHL ambitions.

Gretzky Can Cash Out Huge

If the sale goes through with Jim Balsillie...

Paul Waldie of the Globe and Mail puts the number somewhere between US$22 and $37-million.

Mr. Balsillie, co-chief executive of Research in Motion, has offered to buy the club for $212.5-million. Mr. Gretzky owns 1.5 per cent of the Coyotes and serves as coach and "managing partner".

Court filings show that Mr. Balsillie's offer includes an immediate payment of $8-million to Mr. Gretzky to cover compensation he is owed.

He is also entitled to an additional $14.5-million payment as part of the change in control provisions of his employment contract. Mr. Gretzky's employment contract allows him to walk away from the team if the club is sold and still collect whatever is owing on his contract, court filings show.

The Globe and Mail's Bruce Dowbiggin brings an interesting point to all of this.The CBC could be a big Balsillie ally.

"CBC has been sorely disappointed with the new $100-million NHL TV contract that split the Canadian teams with TSN at the start of the playoffs. (It formerly received all Canadian series.) Needing a financial home run from the package, CBC is having trouble getting to first base this spring.

This April, CBC was forced into a choice that many hockey poolies can understand. Of the three Canadian playoff teams, the two largest markets available - Vancouver, Montreal - were unlikely to go more than four or five games. The team with the best prospects of a long series - Calgary - represented the smaller southern Alberta market. CBC chose the large markets of Vancouver and Montreal. The result: four-game sweeps that left great holes in the CBC programming sked for its traditional Saturday night slot. TSN, meanwhile, ended up with substantial ratings for Calgary's Game Six with Chicago on Saturday April 27. CBC was left with either Wilderness Who's Who or a movie everyone with a pulse has seen twice."