News From TNA Lawyers At Hearing: TNA Cash Flow Problems And Tax Issues, Billy Corgan's Loans, More
As noted, there is a hearing this afternoon between Billy Corgan and TNA at the Chancery Court in Nashville, TN. Nate Rau of The Tennessean is at the hearing, and live tweeted ( @tnnaterau ) the following from the hearing from TNA attorney Travis Parham:
* Parham called the lawsuit a scheme by Corgan to force out Dixie Carter and take over the company.
* Parham said the lawsuit has created a creditor crisis and hurt their financial standing.
* He called TNA a "valuable, well known commodity." It was noted that Carter owns 92.5%, Anthem owns 2% and Aroluxe owns 5%.
TNA has good will, notoriety, merchandising, licensing and is an international brand.
— Nate Rau (@tnnaterau) October 26, 2016
* Parham said that TNA anticipated short terms cash flow problems. He argued that TNA knew its business model would be a challenge.
* He argued that Corgan gave a loan that could be transferred to equity. He said that Corgan lent more money in July and had the right to convert the loan to 12.5 % interest.
* Parham argued that TNA is not insolvent.
* Corgan provided a third loan in August, and Parhan argued that the loans were opportunistic to benefit himself.
He says Corgan wanted 22.5 pct in company after third loan and insisted on pledge agreement.
— Nate Rau (@tnnaterau) October 26, 2016
Parham said Corgan wanted all principal, 6 pct interest and 50 pct equity kicker as condition of 3-month loan in August.
— Nate Rau (@tnnaterau) October 26, 2016
* Parham said that the loan would "make a loan shark blush" and said that Corgan has resisted efforts to let the company repay his loan.
* He said that Corgan doesn't want to be "refinanced and paid off" because he wants Dixie's 92.5%. He said that Corgan has been incredibly well compensated.
* Parham said that Corgan offered to buy the company the day his loan agreement expired, which would have included paying off Aroluxe.
That deal would have given him 52 percent of TNA. "he's now saying company is worth nothing,"
— Nate Rau (@tnnaterau) October 26, 2016
* Parham said that Corgan filed suit after his deal to buy the company fell through last month and added that Corgan did not assist acquiring funding for the September television tapings.
* Parham denies that financial details were hidden from Corgan, and said that Corgan is trying to cause TNA to default on his own loan.
Parham said injunctive relief should be used sparingly. He says Corgan has not suffered irreparable harm.
— Nate Rau (@tnnaterau) October 26, 2016
* Parham said that Corgan wanted to get rid of the current management team and bring in his own, and that Dixie's manager rights can't be transferred under law. He said that the contract between Corgan and Carter is illegal under Tennessee law, and she couldn't transfer her manager rights even if the company is insolvent.
* Parham called cash flow "a small part of the story" and said that parties want to but the company because it is valuable.
* Parham called the tax lien "an accounting mistake" and called it a non-issue.
* Parham called the deal "predatory lending at its worst" and once again stated that TNA is willing to pay off Corgan's loan.
* An attorney for Anthem said that they are willing to pay off Corgan's loan, minus a transaction premium that is due.