[Bullock]

Very interesting.

http://www.unlimitedfightnews.com/xyiencewow.htm

excerpt:

Some fans might have heard that the UFC (AKA Zuffa, LLC) took out a $325 million loan not too long ago: DETAILS OF ZUFFA LOAN. In June 2007 Zuffa, LLC, the parent company of the UFC, borrowed $325 million through a Senior Secured Credit Facilities Term Loan due 6/18/15. This debt instrument was placed with Oppenheimer Funds, Franklin Templeton Funds, Fidelity Funds and others.

Evidently the Fertittas spent most of the proceeds on the purchase of Pride and on a dividend for themselves and Dana White. The provisions of the loan are as follows: The loan is a pledge of the entire Zuffa assets and revenues, including the UFC, and a stated amount of revenue must come from sponsorships.

The new UFC Xyience contract, which newly-crowned co-CEOs Adam Frank and Kirk Sanford negotiated with John Mulkey, the CFO of Zuffa LLC, calls for $9 million the first year, $11 million the second year and $12.14 million the third year. And Xyience will reportedly not be in the center of the mat after March. In other words: The Fertitta funding and new UFC contract with Xyience appears to be a sham for the auditors of Zuffa and the UFC to cover-up the fact that a key covenant in their $325 million loan was in breach.

They were allowed to obtain this loan by representing the sponsors they have are all above board, successful companies. Once Zuffa had secured and collected on their own loan, Fertitta Enterprises and a few other outside investors gave Xyience financing in a deal that shareholders were told would directly benefit the company and provide operating funds for an expansion of the brand. The alternative would be to bankrupt the company. The scare tactic worked. The new investment group now plans to do what they said they were trying to avoid all along, all in order to truly capitalize for themselves on their investment.

Instead of providing bridge financing for an IPO of Xyience stock (as some investors were told the Fertitta funding would facilitate) or funds to pay off a host of other vendor fees Xyience has accrued, the Fertitta loan barely made a dent in Xyience's extensive debt.

Fertitta Enterprises entered into financing Xyience primarily to pay off the company's UFC debt. Almost immediately after the Fertitta money came in, Xyience reportedly forked out over $6.5 million in past due sponsorship fees that had been accrued by Xyience and were owed to the UFC. The company also extended their UFC sponsorship contract right after the Fertitta Enterprises deal became official. The Fertittas and a few other investors basically funded a company on the verge of bankruptcy to provide capital for themselves. So, the Fertittas and a few friends paid the debts owed to the UFC by Xyience while also propping Xyience up as a valid, viable company. Any way you slice it, it's a scam perpetrated by misdirection and manipulation.

Let me be clear though: THIS IS PURE SPECULATION and has not been proven true.

But....


If it is true, it is was a very crafty/smart move by the Dana/Fertittas in order insure payment on the $365mil loan and to make the UFC look good in terms of major sponsors (which considering AMPd just went under, makes sense).