Bigham The Dallas Morning News
Published March 17, 1989
Reprinted with the author's permission.
U.S. bankruptcy judge Robert McGuire did not allow Sidekicks chairman of the board Stan Finney's request Thursday for a super-priority loan and has given the club until Monday at 1:30 p.m. to post $260,000 to keep it operational.
If the club does not pay the $260,000, the Sidekicks' Chapter 11 protection will be lifted and the Sidekicks major creditor, the Dallas Mavericks, could foreclose on the team.
The Sidekicks filed for Chapter 11 protection on Feb. 13 after learning the Mavericks, the Sidekicks' former owner, planned to ask a state court for an order directing the MISL club to surrender all assets because of a $560,000 outstanding note. The note, which was due in July 1988, would have completed the sale from the Mavericks to the group headed by Finney.
In the bankruptcy hearing, the Mavericks organization sought to have the Chapter 11 protection lifted and take over the franchise. But the court will allow the Sidekicks until June 20 to present a reorganization plan if it makes the $260,000 payment Monday and three additional payments of $130,000 each in April, May and June.
"He (McGuire) basically decided three issues,' Finney said. "One, he did not grant the super-priority loan; second, he valued the collateral (franchise) at $175,000; and third, he will not lift the stay if certain capital infusions are made.'
Finney was agreeable to loaning the club $260,000 only on a super-priority basis, which means he would have been the club's first creditor. But now the Sidekicks' shareholders are forced to meet the court's requirements. Finney said he plans to meet with the Sidekicks' other owners this weekend.
"They (the Mavericks) could foreclose after 1:30 p.m. on Monday,' said Sidekicks special counsel David Shuttee.