When I opened up my morning copy of the Tennessean and saw the headline "Del Biaggio may have skirted full NHL review," that grabbed my attention. When I then saw a picture of NHL commissioner Gary Bettman underneath Boots Del Biaggio's, with the caption "may have given Del Biaggio special treatment," I had to sit down, because this looked the beginning of the end for Bettman's reign as commissioner. Major kudos, by the way, for Brad Schrade, the Tennessean writer who is leading the way with this story.
The main gist is that Doug Bergeron, who at one time was poised to invest in Del Biaggio's minority share, claims the following:
The "put right" (as found in the draft version of the ownership group's operating agreement) basically gives the Series A shareholder (Forecheck Holdings, Del Biaggio's investment firm) a way out of the Predators in the event that they were to buy into a different NHL team, get awarded an expansion NHL team, or if the rest of the ownership group failed financially, like going into default on loan payments. But come on, what kind of NHL owner would default on a loan, right? How wacky would that be?
Anyways, if Forecheck Holdings exercised that right, the rest of the ownership would be forced to buy out the Series A shares within 120 days. If they didn't, Forecheck would gain operational control of the team. Basically, this is a financial protection clause for Forecheck, offering them a way out if a majority ownership opportunity came along, or the Predators sank like a rock and failed to meet financial obligations.
Now remember, the story here is that Bergeron claims these two things, and that doesn't necessarily make them true (especially with Del Biaggio's credibility these days). The NHL responded in the piece by saying that Del Biaggio was "treated in a consistent manner as with the applications of other prospective owners," and David Freeman, the leader of the local ownership group, replied that the league office wasn't "involved in structuring it or developing it" with respect to the operating agreement and the put right.
If this is the truth, however, this could represent a situation that might finally bring about the fall of Gary Bettman, which some (especially hockey fans in Canada) have been awaiting for years. In yesterday's Globe and Mail, Stephen Brunt cut the commissioner some slack, writing that Del Biaggio had put Bettman in an "awkward position" after having backed him as a savior for Nashville while turning Jim Balsillie aside. He wrote,
I can't wait to see how the hockey press eats this one up...
The main gist is that Doug Bergeron, who at one time was poised to invest in Del Biaggio's minority share, claims the following:
Bergeron said Del Biaggio told him in December that National Hockey League Commissioner Gary Bettman's office had given special permission for Del Biaggio to buy a share of the team without being subjected to all the scrutiny the league usually gives to prospective owners. Del Biaggio told him the commissioner's office did not require him to show audited financial statements before it approved him.There are really two big whammys here: the first, obviously, is that the NHL potentially took a shortcut with Del Biaggio's background check, a gaffe that is blowing up in the worst way possible. The second, however, speaks to Bettman's involvement, if not his seminal role, in the arrangement of a "put right", which requires a bit of explanation...
"Boots bragged to me that he was able to convince Bettman's office to overlook the need for his audited financial statements because it was too much work," Bergeron said.
Bettman himself told Bergeron that he helped arrange the agreement that Del Biaggio had with the Predators' local owners, Bergeron said.
The "put right" (as found in the draft version of the ownership group's operating agreement) basically gives the Series A shareholder (Forecheck Holdings, Del Biaggio's investment firm) a way out of the Predators in the event that they were to buy into a different NHL team, get awarded an expansion NHL team, or if the rest of the ownership group failed financially, like going into default on loan payments. But come on, what kind of NHL owner would default on a loan, right? How wacky would that be?
Anyways, if Forecheck Holdings exercised that right, the rest of the ownership would be forced to buy out the Series A shares within 120 days. If they didn't, Forecheck would gain operational control of the team. Basically, this is a financial protection clause for Forecheck, offering them a way out if a majority ownership opportunity came along, or the Predators sank like a rock and failed to meet financial obligations.
Now remember, the story here is that Bergeron claims these two things, and that doesn't necessarily make them true (especially with Del Biaggio's credibility these days). The NHL responded in the piece by saying that Del Biaggio was "treated in a consistent manner as with the applications of other prospective owners," and David Freeman, the leader of the local ownership group, replied that the league office wasn't "involved in structuring it or developing it" with respect to the operating agreement and the put right.
If this is the truth, however, this could represent a situation that might finally bring about the fall of Gary Bettman, which some (especially hockey fans in Canada) have been awaiting for years. In yesterday's Globe and Mail, Stephen Brunt cut the commissioner some slack, writing that Del Biaggio had put Bettman in an "awkward position" after having backed him as a savior for Nashville while turning Jim Balsillie aside. He wrote,
After surely undertaking the necessary due diligence, Bettman must have believed that Del Biaggio offered the best chance to achieve his oft-stated goal: saving hockey in Nashville.Today's story undercuts that charitable stance twice; firstly, by alleging that due diligence wasn't performed, and secondly, because Bettman knew of, and played a role in crafting, a mechanism by which Del Biaggio could assume control of the franchise. To many, pushing Jim Balsillie aside was bad enough. To do so without thoroughly vetting Del Biaggio, and to help structure an agreement that could result in an abrupt change of control like this, smacks of preferential treatment that would be hard to justify.
I can't wait to see how the hockey press eats this one up...