Phoenix Coyotes Hockey on AZ Vibe

Earlier yesterday morning Sportsnet in Canada reported that the Glendale City Council went into a special session to discuss a brand new Memorandum of Understanding (MOU) with the Ice Edge Holdings group.

By the end of the day the City of Glendale announced that they have agreed upon a new MOU with the Ice Edge Holdings group granting them exclusive negotiating rights for a potential purchase of the Phoenix Coyotes.

Here’s a copy of the MOU:

http://www.azvibe.com/docs/ice-edge-city-of-glendale-MOU.pdf

Understanding the Memorandum of Understanding

So here’s how to break down the legalese in the Memorandum of Understanding.

First off, both the City of Glendale and Ice Edge Holdings are in agreement that the purchase of the Phoenix Coyotes is in process. In addition the City of Glendale will grant exclusive rights to Ice Edge Holdings to negotiate the purchase of the Coyotes. The City of Glendale (COG) will create a Communities Facility District (CFD), within 120 days of the MOU being signed that will collect revenues on parking in and around the Jobing.com arena. Ice Edge Holdings will pass their rights to operate/manage/collect money for parking and ticket surcharges to the COG who will in turn pass the same right onto the CFD. They also will create an ‘Operating Loss Reserve’ account to help fund any potential losses up to $50 million dollars over a period of 10 years not to exceed a maximum of a potential $10 million dollars per year.

Some of the more important highlights of the MOU, once it’s been signed and approved are:

- As long as Ice Edge has outstanding debt the CFD will collect money to pay a ‘Parking Operations Fee’ to Ice Edge so long as they have ‘outstanding debt incurred for the purchase of the Coyotes’.

- If the CFD cannot make payments to the Ice Edge Holding ownership group for the next five years, Ice Edge will have an out clause giving only 180 days notice to the COG.  If the team is sold in this instance, Ice Edge will be free from any debt related to the Coyotes or their Arena lease.

- Ice Edge Holdings will have the opportunity to outright purchase the Jobing.com Arena from the City of Glendale. This offer is only good for five years after the signing of the MOU.

- Ice Edge will begin the process of changing the name of the Phoenix Coyotes to the ‘Arizona Coyotes’.

- Regarding the AMULA Amendments to the current Coyotes lease that are needed for the Ice Edge Holdings group to become successful and profitable, nothing has been promised by the City of Glendale. However, both ‘parties will use commercially reasonable efforts’ to come up with a mutually beneficial solution to this issue.

- Once the MOU is signed and approved by the NHL, both parties want to have the full deal completed within 60 days. This includes 1) Ice Edge presenting, within 10 days of signing the MOU, proof that they have the money to make the purchase. If this proof is not provided within 10 days, Ice Edge Holding’s right for exclusive negotiations will terminate. Also, if someone comes up with a $25 Million deposit to purchase the Coyotes Ice Edge Holding’s exclusive rights to negotiate a deal with the City of Glendale will terminate.

The Next Step…

On June 8th the Glendale City Council will vote on the recommendation to authorize the City Manager to enter into a Memorandum of Understanding (MOU) with Ice Edge Holdings. If this resolution passes, the City of Glendale will pass this on to the NHL. The NHL will then decide to accept the MOU or not.

http://www.azvibe.com/docs/city-of-glendale-council-agenda-060810.pdf

What the City of Glendale has to say about the latest developments

Finally, the City of Glendale released the following statement about

http://www.azvibe.com/docs/GlendaleStatementCoyotesJune42010.pdf