Millions in Preds loan under cloud

By Brad Schrade • Staff Writer (Tennessean) • June 11, 2008 A national arena management company is suing Predators minority owner William J. “Boots” Del Biaggio III, claiming he misled and defrauded them in a $7 million loan last year to help buy the team. The lawsuit by AEG Facilities, Inc. is the fifth suit filed against Del Biaggio in the past two weeks, each claiming he defrauded lenders. The AEG suit is the second related directly to the purchase of the Predators last December. Modern Bank filed suit June 2 to recover $10 million it loaned Del Biaggio to help purchase the team last year. AEG Facilities is a division of AEG, a worldwide entertainment company which manages numerous sports facilities and owns pro teams, including the Los Angeles Kings hockey team. Del Biaggio until last year had an agreement with AEG to try to move a hockey team to Kansas City, where the company manages and owns a stake in the new Sprint Center. AEG’s suit filed Friday in Superior Court in Santa Clara, California came the same day Del Biaggio filed for bankruptcy in Northern California. He owes approximately $70 million to creditors, but has only about $50 million in assets, according to his attorney. A copy of the lawsuit claims that on Oct. 29 last year, AEG loaned Del Biaggio the money. He used various securities he claimed to owned as collateral, the suit claims. Two of the three investment accounts Del Biaggio claimed to own were not his and documentation was “fraudulently altered” to make it appear he owned them, the suit claims. Merriman, Curhan, Ford & Co, an investment company, and Scott Cacchione, are named co-defendants in the lawsuit. Del Biaggio is also facing a federal investigation into his dealings. Del Biaggio owns a 27 percent stake in the Predators. He was the only major out-of-town investor in a group led by local businessman David Freeman. The group bought the team from Craig Leipold last December. The bankruptcy filing Friday revealed that he also owed Leipold $10 million. It was unclear in the bankruptcy documents whether that money was related to the Preds purchase. Leipold and the team would not comment about the details of that debt.The team maintains that Del Biaggio’s troubles will not impact the Predators operations. The team is reportedly seeking to buy him out or find other investors to purchase his stake. That process could be complicated by the bankruptcy filing last week. Metro could face exposure if his troubles impact the team. The city owns the Sommet Center and restructured the team's lease just months, offering favorable terms to help the team operate. In exchange, Del Biaggio and other owners personally guaranteed money to Metro in event they default on the lease or leave town early. Metro Sports Authority, the city’s landlord for its pro sports facilities, will meet Friday to discuss what legal options it may pursue in the wake of Del Biaggio's financial problems.

Predators get new arena lease with Metro

By MICHAEL CASS • Staff Writer • April 15, 2008 The Nashville Predators have a new lease at the Sommet Center - one their owners say will give them a better chance of succeeding in Nashville - after a decisive Metro Council vote tonight. The council voted 30-8 for the new agreement, which comes after months of negotiations. It will give the hockey team's owners more money for managing the facility and more incentives for booking top events there while also protecting the city's investment in the Predators more effectively. A group of mostly local investors bought the Predators last fall from Craig Leipold, who said he lost some $70 million in nine-plus years. The Predators trail the Detroit Red Wings 2-1 in a first-round playoff series that continues Wednesday night at the Sommet Center.

Predators' lease proposal questioned

'Seems like a blank check,' Metro councilman saysBy MICHAEL CASS • Staff Writer Tennessean) • April 9, 2008 A handful of Metro Council members asked tough questions about proposed arena lease changes for the Nashville Predators on Tuesday, a week before their final vote on the deal. Council members asked how they could sell multimillion-dollar annual subsidies of the pro hockey team to middle-class and poor constituents; why the cap on arena operating losses that the city would pay is set at the 2006 level, which is more than $2 million higher than this year's projections; and whether other cities are on the hook for such losses when a sports franchise also serves as the facility manager. (A 2003 audit by KPMG LLC said Metro's arrangement is unusual.) "It just seems like a blank check," Councilman Phil Claiborne of Donelson said after the council's Budget and Finance Committee met with city attorneys and finance officials. The Predators' new, mostly local owners say they need a new, more generous deal at the Sommet Center — which the team's sister company operates for the city — to have a chance of succeeding financially and keeping the team here. The proposal negotiated by Mayor Karl Dean's administration would increase payments and incentives to the Predators while also protecting the city's investment more effectively, supporters say. At-large Councilman Charlie Tygard said Nashville is "considerably different" than it was before major-league sports teams arrived in the late 1990s."I don't want to go back to those previous days, quite frankly," Tygard said. The full council is expected to vote on the lease when it meets next Tuesday.