Loan dispute not related to Texas Stars

Loan dispute not related to Texas Stars

Sunday, 12 April 2009

The Hicks Sports Group has not come to an agreement with its lenders regarding the debt terms and covenants related to the Texas Rangers and Dallas Stars.

However, representatives for HSG and the City of Cedar Park say the ongoing negotiations related to HSG withholding the interest payment on $515 million in debt related to the two Dallas-area teams will have no effect on the Cedar Park Center or the Texas Stars hockey team.

The Texas Stars are owned by a separate Hicks holding company than are the Rangers and Dallas Stars, said Cedar Park Economic Development Director Phil Brewer.

Though Hicks Cedar Park LLC, the company Cedar Park has partnered with to build the Cedar Park Center, is not involved in the dispute, Brewer said the city’s contract has conditions built in to protect it.

For example, if a hockey team is not playing in the Cedar Park Center by the 2010 season, Hicks Cedar Park LLC owes the city $5 million.

Additionally, Brewer said Hicks Cedar Park LLC’s $12 million contribution to the Cedar Park Center was placed in escrow before Cedar Park even issued bonds to pay for its $43 million portion of the project.

“To the city’s credit, we engaged outside legal counsel [to draw up the contract] who was very experienced in this area, having worked on several large stadium/arena projects in Houston,” Brewer said.

At the April 9 city council meeting, a Cedar Park Center project update revealed the stadium is on track to be substantially completed by Sept. 25 as planned. Construction costs have run about $131,000 over budget. The extra money was contributed by Hicks in order to change the planned merchandise store in the center to a restaurant.

See earlier story at http://more.impactnews.com/3941