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Dallas Business Journal:

As this week's likely make-or-break hearing gets under way in a Fort Worth courtroom on Tuesday, all eyes will be on the federal judge and whether he orders the Rangers put up for auction again. Such a move could dislodge Greenberg and Ryan, who agreed to buy the team in January. Creditors have blocked the deal in part because, they argue, the duo's bid was not the highest.

The creditors would surely contest the breakup fee, sources said, pointing out that the two were required to put down just $1.5 million on a $575 million deal.

"Five percent of a deal is more typical," said Bill Siegel, a Texas bankruptcy attorney with Cowles & Thompson who has argued before the U.S. Bankruptcy Court for the Northern District of Texas. A 5 percent down payment on this deal would translate to $28.75 million.

The down payment and the breakup fee were disclosed in court documents filed since the Rangers, who are seeking to override the creditors' objections to the sale, filed for bankruptcy protection last month. The team's parent company, Hicks Sports Group, defaulted on its debt in March 2009 and agreed to sell the club later that year.

"I think [Judge Michael Lynn] is going to re-open the bidding," Siegel said. "He's got to go get the highest bid."

Cowles & Thompson Bankruptcy Attorney William Siegel quoted in DBJ

Lynn has not tipped his hand, but at a hearing in late May he did not discourage the Rangers from seeking higher bids. He also emphasized that his role is to maximize the assets for creditors.

The creditors believe Greenberg and Ryan were chosen as part of a process that MLB tilted toward them and, thus, they should not be entitled to the breakup fee.

Greenberg, at last month's hearing, said he won the bidding through a fair and transparent process.

http://www.bizjournals.com/dallas/stories/2010/06/14/daily1.html

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