Jim Balsillie's representatives and lawyers for the City of Hamilton are expected to reach an agreement this morning that if he completes the purchase of the Nashville Predators and decides to move the team, it would be moved only to Hamilton.
A source familiar with the negotiations said the Hamilton city council hopes to announce the deal, which Balsillie and his representatives insist is a contingency plan, after its meeting tonight. Also expected to be announced is an agreement that Balsillie will take over management of Hamilton Entertainment and Convention Facilities Inc., a city corporation that operates Copps Coliseum, a convention centre, Hamilton Place and a parking garage.
The new agreement would take the Kitchener-Waterloo area of Ontario out of the running.
It had been speculated that Balsillie, the co-chief executive officer of BlackBerry manufacturer Research In Motion, wanted to move the Predators to Kitchener-Waterloo, the location of his company's headquarters.
Balsillie's lawyer, Richard Rodier, is expected to finish negotiating the deals with Hamilton city lawyers this morning. They will be presented to council for approval tonight.
However, the plans are conditional on Balsillie's $220-million (U.S.) purchase of the Predators. One National Hockey League governor, who requested anonymity, said he and a number of his peers are not happy with the way Balsillie is conducting his bid for the team.
They are upset that while Balsillie is telling people in Nashville the team will not move as long as an arena lease (which has an out-clause based on attendance) is in place, he is also negotiating with Hamilton.
"If you join a club or a fraternity, it is a bunch of people who have to work together in a partnership," the governor said. "Sometimes you have to give up what you want for the greater good of the league. This is not the way to come in [to the NHL]
"In my travels, I've already had people, unasked, say, 'Who is this clown?' I've had three clubs mention this to me."
The governor said the three clubs were not in Southern Ontario, a reference to the Toronto Maple Leafs and the Buffalo Sabres. Under NHL rules, a team cannot move within 80 kilometres of the corporate limits of another NHL city without that club's permission and the approval of the board of governors.
However, Balsillie and his representatives have let it be known that they interpret the rules to say only the consent of a majority of NHL governors is necessary. There is also a belief among NHL people that Balsillie is willing to win the right to move to Hamilton in a court battle.
A formal application to purchase the team was presented recently to the NHL and Balsillie's representatives are working on a purchase agreement with the Predators. A letter of intent states the deal must close by June 30, but that could be extended in the purchase agreement.
Balsillie is hoping the purchase will be approved by the NHL governors at their meeting on June 20 in order to begin making plans for the player roster. But an NHL source said that is not going to happen because the bid will not be ready for approval.
The Canadian Competition Bureau is also looking into the proposed move to see whether the NHL's bylaws violate Canadian laws governing monopolies.
But if Balsillie's purchase of the Predators from Craig Leipold is not approved by the governors, those problems would become moot. Speculation is that Balsillie paid more than the market price for the Predators to head off opposition from the NHL governors because that raises the market value of many franchises.
However, the NHL governor said, the league does not want to make the mistake of allowing someone to buy a team, only to discover he is a maverick.
"You get in the club and everyone thinks you'll be okay, but you turn out to be a pain in the ass," the governor said. "This guy is showing he is a pain in the ass before he even gets in the club."
When the governor's remarks were relayed to Rodier, he responded with a statement by e-mail pointing out the other prospective buyer for the Predators, venture capitalist William (Boots) Del Biaggio, also has a contingency plan.
"We are under the impression that the sale is on the agenda for the June 19 executive committee meeting and the June 20 [governors]meeting and we have not otherwise been informed by the NHL," Rodier said. "Since we are not doing anything different than Boots Del Biaggio has done in having a lease agreement with the Sprint Centre in Kansas City, we fail to understand why the NHL would have any problem.
"We are simply making contingency plans since the team would need a place to play in the event that the lease in Nashville were to terminate prior to its expiration date and nothing else."
A spokesman for Hamilton Mayor Fred Eisenberger said there would be no comment until after tonight's council meeting.
That contingency plan would be nailed down a little tighter if Balsillie reaches an agreement that the Predators would move only to Hamilton.
By giving Balsillie the right to manage venues that include Copps Coliseum, where the Predators would play, the city could save as much as $1-million a year. Hamilton Entertainment and Convention Facilities has an annual deficit of about $4-million, but the agreement with Balsillie is expected to see him take on some of that, with the city handling about $3-million of the deficit.
However, Copps Coliseum would be a temporary home. Balsillie told NHL commissioner Gary Bettman last year that if he moves a team to Hamilton, he would build a new arena.
Asked about the pending agreements with Hamilton, Rodier would say only that any relocation would depend on the Nashville arena lease no longer being valid and on the consent of the NHL.