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Coyotes' ownership saga finally coming to a head

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The Canadian Press
7/1/2013 4:16:39 PM
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GLENDALE, Ariz. -- The Phoenix Coyotes' four-year bid for stability will finally come to a close soon.

With Tuesday night's Glendale City Council meeting, the Coyotes will find out if the city will approve an arena lease agreement with Renaissance Sports & Entertainment, which has an agreement in place to buy the franchise from the NHL.

Should the council approve the 15-year, $225 million deal for Jobing.com Arena, the path will be cleared for the Coyotes to stay in Arizona.

A vote against the lease agreement means the Coyotes are almost certainly headed out of town for good.

"I don't want to be more specific than I'm going to be, but if the council doesn't approve it so this transaction can close, I don't think the Coyotes will be playing there anymore," NHL Commissioner Gary Bettman said at the league's Board of Governors meeting last week.

The Coyotes' ownership saga goes back to 2009, when former owner Jerry Moyes took the team into bankruptcy in a failed attempt to sell it to Blackberry founder Jim Balsillie, who would have moved the franchise to Hamilton, Ontario. The NHL and Glendale fought the plan in court and the team was sold to the league later that year.

The quest to find an owner has been filled with twists and turns in the four years since, with new owners coming forward and falling away, rumours of relocation popping up and plenty of politicking.

The Coyotes appeared to have an owner in place when Chicago businessman Matthew Hulsizer was set to buy the team two years ago, but his bid was thwarted by the conservative watchdog group Goldwater Institute, which warned potential bond buyers to stay away from the Glendale offering because of a looming lawsuit.

A group headed by former San Jose Sharks CEO Greg Jamison reached an agreement with the NHL to buy the team last year, but his deal fell apart when he was unable to secure finances before a lease-agreement deadline with Glendale in January.

RSE, headed by George Gosbee, Anthony LeBlanc and Daryl Jones, agreed to a deal to buy the team from the NHL last month.

That was only the first step, though.

RES still had to work out a lease agreement with Glendale, a city that's in financial trouble, in part because it has paid $25 million each of the past two years to keep the Coyotes.

The two sides have spent the past few weeks working on an agreement for Jobing.com Arena and released a draft of the deal last week.

But, as has been the case in this soap operatic story, the deal was far from done.

At the same time it posted a draft of the lease agreement on its website, Glendale also released a list of concerns about the deal, including a $15 million management fee to run the arena and an out clause that could allow RSE to move the team without penalty if its cumulative losses reach $50 million or after five years.

Glendale came up with a counterproposal on Friday, one that included an out clause for the city. RSE called the out clause, which no other NHL city has, a non-starter, creating added tension heading into Tuesday's council vote.

"I think it would be a huge mistake for Glendale to make, that they would have anything but an enormous financial disaster on their hands trying to keep that arena open after losing an anchor tenant and 41 nights," said former Arizona Attorney General Grant Woods, who's representing RSE. "The reality, in my opinion, is that the arena will shut down. I hope that won't happen to them, but they need to look at the hard realities of the way the world works and I think that's the reality here."

One thing's for certain: The Coyotes will know their future soon, one way or the other.

Fans in Phoenix (Photo: Christian Petersen/Getty Images)

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(Photo: Christian Petersen/Getty Images)
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