Posted Saturday, September 19, 2009 8:20 PM | Contributed by Chitown
A New Orleans board drafted a lease termination agreement for Six Flags that will be presented to the bankruptcy court in Delaware on Oct. 8 for approval. In addition to terminating the lease, an agreement signed Friday by Mayor Ray Nagin and IDB President Walter C. Flower III calls for Six Flags to make a $3 million cash payment to the city. The company will also give New Orleans 25 percent of its net Hurricane Katrina-related insurance proceeds if the recovery amount exceeds $65 million.
Read more from The Times-Picayune.
Ok first of all, Six Flags has $2.4 BILLION, not million, in debt. That's a slight error in the article.
Second of all, unless I'm missing something, Six Flags doesn't have to agree to anything. They can reject the lease, and the landlord is S.O.L.
I'm not really sure what the city is doing by proposing their own agreement to the Bankruptcy court. Unless there is something else in the original lease agreement, securing the City's interests, the bankruptcy courts usually favor the lessee in all respects.
I was going to ask the same question. I don't see how the city is any more of a creditor than anyone else, and has to stand their place in line.
This seems really greedy considering that others have shown interest in using the land. The focus seems to be about getting blood from a stone rather than allowing the property to generate tax dollars in the hands of someone else.
They likely will stand in their place in line, but I believe this is being done so that the new developer can get the green light to begin construction once their finances are secured. The bankruptcy court has to ok this agreement first.
At this point, if they actually have a developer that's willing to do something with the land, what's another 3 million. Just cut your losses and terminate the lease without asking Six Flags for money. It's money that, if they ever see anyway, will probably be less than they ask for. Plus, any amount of delay will only lessen the chance that the developers will actually proceed with their plan.
They likely will stand in their place in line, but I believe this is being done so that the new developer can get the green light to begin construction once their finances are secured.
That should happen somewhere around the 1st of Neveruary, right? I can't seem to find that month on my calendar.
Pessimist much? Next month Southern Star will go before the state bond commission for approval. Never say never, it was an unlikely plan that got Jazzland developed in the first place. I'm not saying it's going to happen, but I also didn't think they would get to this point, and obviously they did. I'm sure you don't get licensing rights from Viacom with a crack plan that would never work.
I'm thinking the $3 million is for the backed lease payments that Six Flags has not made.Last edited by Cameraman, Sunday, September 20, 2009 10:04 PM
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