First Lien Lenders Objection

Case 10-43400-dml11 Doc 451 Filed 07/28/10 Entered 07/28/10 16:12:39 Desc
Main Document Page 1 of 61

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Dennis F. Dunne (admitted pro hac vice) Mitchell A. Seider, SBT #18000550
MILBANK, TWEED, HADLEY & MCCLOY LLP LATHAM & WATKINS LLP
1 Chase Manhattan Plaza 885 Third Avenue
New York, NY 10005-1413 New York, NY 10022
Tel.: 212.530.5000 mitchell.seider@lw.com
Fax: 212.530.5219
Michael R. “Buzz” Rochelle, SBT #17126700
ddunne@milbank.com
Scott M. DeWolf, SBT #24009990
ROCHELLE MCCULLOUGH LLP
Andrew M. Leblanc (admitted pro hac vice)
325 North Saint Paul St., Suite 4500
MILBANK, TWEED, HADLEY & MCCLOY LLP
Dallas, TX 75201
1850 K Street, N.W., Suite 1100
buzz.rochelle@romclawyers.com
Washington, DC 20006
sdewolf@romclawyers.com
Tel.: 202.835.7500
Fax: 202.263.7574 ATTORNEYS FOR JP MORGAN CHASE
aleblanc@milbank.com BANK, N.A. AS FIRST LIEN AGENT
Jennifer C. DeMarco, (admitted pro hac vice)
Daniel C. Stewart, SBT #19206500
David A. Sullivan, (admitted pro hac vice)
Paul E. Heath, SBT #09355050
CLIFFORD CHANCE US LLP
Richard H. London, SBT #24032678
31 West 52nd Street
VINSON & ELKINS LLP
New York, New York 10019-6131
2001 Ross Avenue, Suite 3700
Tel: 212.878.8000
Dallas, TX 75201
Fax: 212.878.8375
Tel: 214.220.7700
jennifer.demarco@cliffordchance.com
Fax: 214.220.7716
david.sullivan@cliffordchance.com
dstewart@velaw.com
pheath@velaw.com
rlondon@velaw.com Holland N. O'Neil, SBT #14864700
GARDERE WYNNE SEWELL LLP
ATTORNEYS FOR THE AD HOC 1601 Elm Street, Suite 3000
GROUP OF FIRST LIEN LENDERS Dallas, Texas 75201
Tel: 214.999.4961
Fax: 214.999.3961
honeil@gardere.com
ATTORNEYS FOR GSP FINANCE LLC, AS

SECOND LIEN AGENT
IN THE UNITED STATES BANKRUPTCY COURT

FOR THE NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION
In re: §
§
TEXAS RANGERS BASEBALL § Case No. 10-43400 (DML)-11
PARTNERS § (Chapter 11)
Debtor. §
§
JOINT OBJECTION OF AD HOC GROUP OF FIRST LIEN LENDERS, JP MORGAN

CHASE BANK, N.A., AS FIRST LIEN AGENT, AND GSP FINANCE LLC, AS SECOND
LIEN AGENT, TO CONFIRMATION OF DEBTOR’S SECOND AMENDED PLAN
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TABLE OF CONTENTS
Page(s)
PRELIMINARY STATEMENT ................................................................................................. 1
UPDATED STATEMENT OF RELEVANT FACTS ................................................................. 5
ARGUMENT ............................................................................................................................. 8
I. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTIONS

1129(a)(7) AND 1129(a)(10)........................................................................................... 9
A. Lenders’ Claims Are Impaired Within Definition of Impairment in

Memorandum Opinion......................................................................................... 9
B. Impairment of Lenders’ Claims Goes Further .................................................... 11
C. Second Amended Plan Fails to Satisfy Section 1129(a)(10) of the

Bankruptcy Code ............................................................................................... 14
D. Second Amended Plan Fails to Satisfy Section 1129(a)(7) of the

Bankruptcy Code ............................................................................................... 15
II. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1129(A)(1) .................................................................................................................... 16
A. Second Amended Plan Violates Section 502(a) of the Bankruptcy Code ............ 16
B. Second Amended Plan Violates Section 524(e) of the Bankruptcy Code ............ 18
1. Exculpation Provision Is Illegal Under Existing Fifth Circuit Law.......... 19
2. Indemnification Provision Is Impermissible............................................ 21
C. Second Amended Plan Violates Section 1141(d)(3) of the Bankruptcy

Code .................................................................................................................. 22
D. Second Amended Plan Violates Section 1123(a)(5) of the Bankruptcy

Code .................................................................................................................. 23
1. Second Amended Plan Fails to Provide Adequate Means for

Implementation Regarding Compliance With May APA ........................ 23
2. Second Amended Plan Fails to Provide Proper Means of

Implementation Regarding Treatment of Class 8 .................................... 25
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3. Second Amended Plan, in Conjunction with Land Sale Agreement,

Authorizes an Improper Release of Valuable Estate Causes of
Action .................................................................................................... 26
III. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1129(A)(2) .................................................................................................................... 31
A. Debtor Lacked Authority to File Second Amended Plan in Violation of

Fed. R. Bankr. P. 9001....................................................................................... 31
B. Second Amended Plan Fails to Comply with Section 1125 of the

Bankruptcy Code ............................................................................................... 32
C. Debtor’s Conduct Violates Due Process............................................................. 33
IV. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1129(A)(3) .................................................................................................................... 34
A. Second Amended Plan Is a Bad Faith Attempt to Vitiate Lenders’ Rights

under Pledge Agreement .................................................................................... 35
B. Second Amended Plan Is a Bad Faith Attempt to Obtain Approval of

Transactions Violating State Law....................................................................... 36
C. Second Amended Plan Was Proposed in Bad Faith Because It Sanctions

Violations of Fiduciary Duties ........................................................................... 38
1. Debtor’s Management Violated Its Duty of Loyalty ............................... 39
2. Debtor Violated Its Duty to Maximize Value.......................................... 42
V. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1129(A)(5) .................................................................................................................... 44
VI. SECOND AMENDED PLAN FAILS TO SATISFY SECTION 1129(A)(11) ............... 45
VII. SECOND AMENDED PLAN FAILS TO SATISFY CRAMDOWN

REQUIREMENTS OF SECTION 1129(B) ................................................................... 47
CONCLUSION ........................................................................................................................ 49
#4827-0637-1846 ii
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TABLE OF AUTHORITIES
Page(s)
CASES
Airline Pilots Ass’n, Int’l v. American Nat’l Bank & Trust Co. (In re Ionosphere Clubs,
Inc.),
156 B.R. 414 (S.D.N.Y. 1993), aff'd, 17 F.3d 600 (2d Cir. 1994) ........................................ 27
August v. August,
2009 WL 458778 (Del. Ch. Feb. 20, 2009).......................................................................... 37
Avery Point CLO, Ltd. v. Texas Rangers Baseball Partners,

No. 10-04098 (Bankr. N.D. Tex, June 11, 2010) ................................................................. 25
B.M. Brite v. Sun Country Dev., Inc. (In re Sun Country Dev., Inc.),
764 F.2d 406 (5th Cir. 1985) ............................................................................................... 34
Bank of New York Trust Co. v. Official Unsecured Creditors’ Comm. (In re Pacific
Lumber Co.),
584 F.3d 229 (5th Cir. 2009) ............................................................................................... 19
Bennett v. Gemmill (In re Combined Metals Reduction Co.),

557 F.2d 179 (9th Cir. 1977) ............................................................................................... 39
Cajun Electric, 119 F.3d at 356 ................................................................................................. 28
Conn. Gen. Life Ins. Co. v. United Cos. Fin. Corp. (In re Foster Mortgage Corp.),
68 F.3d 914 (5th Cir. 1995) ........................................................................................... 27, 28
Crestar Bank v. Walker (In re Walker),

165 B.R. 994 (E.D. Va. 1994) ....................................................................................... 23, 46
Fed. Sav. & Loan Inc. Corp. v. D & F Constr. (In re D & F Constr.),
865 F.2d 673 (5th Cir. 1989) ............................................................................................... 48
Fin. Sec. Assurance, Inc. v. T-H New Orleans Ltd. P’ship (In re T-H New Orleans Ltd
P’ship),
116 F.3d 790 (5th Cir. 1997) ............................................................................................... 34
Gallagher & Ascher Co. v. Simon,

687 F.2d 1067 (7th Cir. 1982) ............................................................................................. 18
Gearhart Indus., Inc. v. Smith Int’l, Inc.,

741 F.2d 707 (5th Cir. 1984) ................................................................................... 39, 40, 44
#4827-0637-1846 iii
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In re 50-Off Stores, Inc.,

231 B.R. 592 (Bankr. W.D. Tex. 1999) ............................................................................... 34
In re Allied Gaming Mgmt., Inc.,

209 B.R. 201 (Bankr. W.D. La. 1997) ................................................................................. 41
In re Bidermann Indus. U.S.A. Inc.,

203 B.R. 547 (Bankr. S.D.N.Y. 1997) ................................................................................. 43
In re Big Rivers Elec. Corp.,

233 B.R. 726 (Bankr. W.D. Ky. 1998), aff’d, 233 B.R. 739 (W.D. Ky. 1998)...................... 43
In re Block Shim Dev. Co.-Irving,

939 F.2d 289 (5th Cir. 1991) ............................................................................................... 34
In re Chadda,
2007 Bankr. LEXIS 4213 (Bankr. E.D. Pa. Nov. 9, 2007) ................................................... 47
In re Clarkson,
767 F.2d 417 (8th Cir. 1985) ............................................................................................... 45
In re Conseco, Inc.,
330 B.R. 673 (Bankr. N.D. Ill. 2005)................................................................................... 26
In re Coram Healthcare Corp.,

271 B.R. 228 (Bankr. D. Del. 2001) .............................................................................. 39, 41
In re Coram Healthcare Corp.,

315 B.R. 321 (Bankr. D. Del. 2004) .................................................................................... 27
In re Cypresswood Land Partners, I,

409 B.R. 396 (Bankr. S.D. Tex. 2009)................................................................................... 8
In re Embrace Sys. Corp.,

178 B.R. 112 (Bankr. W.D. Mich. 1995) ....................................................................... 42, 43
In re Energy Coop., Inc.,

886 F.2d 921 (7th Cir. 1989) ............................................................................................... 27
In re Fiesta Homes of Ga., Inc.,

125 B.R. 321 (Bankr. S.D. Ga. 1990) .................................................................................. 26
In re Gen. Electrodynamics Corp.,

368 B.R. 543 (Bankr. N.D. Tex. 2007) ................................................................................ 46
In re Grodel Mfg., Inc.,

33 B.R. 693 (Bankr. D. Conn. 1983) ................................................................................... 42
#4827-0637-1846 iv
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In re Gulf Coast Oil Corp.,

404 B.R. 407 (Bankr. S.D. Tex. 2009)................................................................................. 43
In re Herby’s Foods, Inc.,

2 F.3d 128 (5th Cir. 1993) ..................................................................................................... 9
In re Idearc Inc.,
423 B.R. 138 (Bankr. N.D. Tex. 2009) .......................................................................... 23, 31
In re Internet Navigator Inc.,

289 B.R. 128 (Bankr. N.D. Iowa 2003) ................................................................................. 8
In re Kennedy,
158 B.R. 589 (Bankr. D.N.J. 1993)...................................................................................... 48
In re M&S Assocs., Ltd.,

138 B.R. 845 (Bankr. W.D. Tex. 1992) ......................................................................... 11, 45
In re Madison Hotel Assocs.,

749 F.2d 410 (7th Cir. 1984) ......................................................................................... 11, 34
In re Matco Elecs. Group, Inc.,

287 B.R. 68 (Bankr. N.D.N.Y. 2002) ...................................................................... 27, 28, 31
In re Mirant Corp.,
348 B.R. 725 (Bankr. N.D. Tex. 2006) .......................................................................... 28, 29
In re Pilgrim’s Pride Corp.,

2010 WL 200000 .......................................................................................................... 19, 20
In re Polytherm Indus., Inc.,

33 B.R. 823 (W.D. Wis. 1983) ............................................................................................ 44
In re Premier Network Servs., Inc.,

Case No. 04-33402-HDH-11, 2005 WL 6443642 (Bankr. N.D. Tex. July 1, 2005).............. 45
In re Repurchase Corp.,
332 B.R. 336 (Bankr. N.D. Ill. 2005)................................................................................... 47
In re Scioto Valley Mortgage Co.,

88 B.R. 168 (Bankr. S.D. Ohio 1988).................................................................................. 44
In re Suncruz Casinos, LLC,

342 B.R. 370 (Bankr. S.D. Fla. 2006).................................................................................. 23
In re Sutton,
78 B.R. 341 (Bankr. S.D. Fla. 1987).................................................................................... 23
#4827-0637-1846 v
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In re TCI 2 Holdings, LLC,

2010 Bankr. LEXIS 1169 (Bankr. D.N.J. Apr. 12, 2010)..................................................... 38
In re Trism, Inc.,
286 B.R. 744 (Bankr. W.D. Mo. 2002)................................................................................ 27
In re USA Detergents, Inc.,

418 B.R. 533 (Bankr. D. Del. 2009) .................................................................................... 20
In re Wonder Corp. of America,

70 B.R. 1018 (Bankr. D. Conn. 1987) ................................................................................. 34
In re Wool Growers Cent. Storage Co.,

371 B.R. 768 (Bankr. N.D. Tex. 2007) ................................................................................ 18
Int’l Bankers Life Ins. Co. v. Holloway,

368 S.W.2d 567 (Tex. 1963) ............................................................................................... 40
JPMorgan Chase Bank, N.A. v. Rangers Ballpark LLC,

No. 10-04124 (Bankr. N.D. Tex. July 16, 2010) .................................................................. 25
L & J Anaheim Assocs. v. Kawasaki Leasing Int’l, Inc. (In re L & J Anaheim Assocs.),
995 F.2d 940 (9th Cir. 1993) ................................................................................... 11, 12, 13
Lopez-Stubbe v. Rodriguez-Estrada (In re San Juan Hotel Corp.),

847 F.2d 931 (1st Cir. 1988)................................................................................................ 39
Meinhard v. Salmon,
164 N.E. 545 (N.Y. 1928) ................................................................................................... 20
Miller v. Broadway,
No. 07-0122, 2007 U.S. Dist. LEXIS 93895 (W.D. La. Dec. 19, 2007).................................. 8
Mims v. Kennedy Capital Mgmt., Inc. (In re Performance Nutrition, Inc.),

239 B.R. 93 (Bankr. N.D. Tex. 1999) ...................................................................... 40, 41, 44
Mission Iowa Wind Co. v. Enron Corp.,

291 B.R. 39 (S.D.N.Y. 2003) .............................................................................................. 44
Morton v. Morton (In re Morton),

298 B.R. 301 (B.A.P. 6th Cir. 2003).................................................................................... 18
Nat’l Convenience Stores Inc. v. Shields (In re Schepps Food Stores, Inc.),
160 B.R. 792 (Bankr. S.D. Tex. 1993)................................................................................. 40
Official Comm. of Unsecured Creditors v. Cajun Elect. Power Coop., Inc. (In re Cajun
Elect. Power Coop., Inc.),
119 F.3d 349 (5th Cir. 1997) ............................................................................................... 27
#4827-0637-1846 vi
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Pepper v. Litton,
308 U.S. 295 (1939).............................................................................................................. 9
Protective Comm. for Indep. Stockholders of TMT Trailer Ferry, Inc. v. Anderson,
390 U.S. 414 (1968)............................................................................................................ 27
Resolution Trust Corp. v. Acton,

844 F. Supp. 307 (N.D. Tex. 1994)...................................................................................... 40
Rodriguez v. Drive Financial Servs., L.P. (In re Trout),

--- F.3d ----, 2010 WL 2510427 (10th Cir. June 23, 2010) ................................................... 37
U.S. v. Kolstad (In re Kolstad),

928 F.2d 171 (5th Cir. 1991) ............................................................................................... 17
Unsecured Creditors Comm. v. General Homes Corp. (In re General Homes Corp.),
199 B.R. 148 (S.D. Tex. 1996) ............................................................................................ 40
West v. Seiffert (In re Houston Drywall, Inc.),

No. 05-95161-H4-7, 2008 Bankr. LEXIS 4060 (Bankr. S.D. Tex. July 10, 2008) ................ 20
Wolf v. Weinstein,
372 U.S. 633 (1963)............................................................................................................ 39
STATUTES
11 U.S.C. § 101(31)(B)............................................................................................................. 44
11 U.S.C. § 1127(c) ............................................................................................................ 32, 33
11 U.S.C. § 1129(a)(5)(b) ......................................................................................................... 44
11 U.S.C. § 1129(b)(1).............................................................................................................. 47
Del. Code Ann. Tit. 6 §1304(a)................................................................................................. 37
Del. Code Ann. Tit. 6 §1307(a)(1) ............................................................................................ 36
Tex. Bus. & Com. Code § 24.005(a) ......................................................................................... 37
Tex. Bus. & Com. Code § 24.008(a)(1)..................................................................................... 36
RULES
Bankruptcy Rule 9019 ........................................................................................................ 27, 28
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Fed. R. Bankr. P. 9001.............................................................................................................. 31
Rule 9001(5) of the Federal Rules of Bankruptcy Procedure ............................................... 31, 32
OTHER AUTHORITIES
7 COLLIER ON BANKRUPTCY ¶ 1129.02[5] ................................................................................. 44
124 Cong. Rec. 32,407 (1978)................................................................................................... 48
H.H. Rep. No. 95-595 ............................................................................................................... 23
S. Rep. No. 95-989 (1978) ........................................................................................................ 23
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PRELIMINARY STATEMENT
The plan for which the Debtor1 is seeking confirmation (the “Second Amended
Plan”) is the result of a determined effort by the Debtor to circumvent the basic protections that
the Lenders negotiated for and received in their prepetition agreements. There is no mystery as
to why the Second Amended Plan has the continued support of the Debtor: the transactions
incorporated therein provide the Debtor’s ultimate equity holder, Thomas O. Hicks, with more
than $70 million of value, a piece of equity in, and the title of “Chairman Emeritus” of, the first-
place Texas Rangers, a full and complete indemnity, and other benefits that he has extracted for
himself in connection with agreeing to sell the Texas Rangers for less than would have been
available from another buyer in a fair auction, all the while leaving the Lenders, who are owed
more than $600 million from Hicks’ affiliates, to suffer substantial losses.
MLB supports confirmation of the Second Amended Plan as it would permit the
Office of the Commissioner of Baseball to select the owner of the Texas Rangers without regard
to the price buyers are willing to pay for it, and – more important – without having the Court
consider whether the Bankruptcy Code’s prohibitions on anti-assignment provisions in contracts
permits MLB to enforce the provisions of the Major League Constitution granting the owners of
MLB franchises (not the Commissioner of Baseball) the right to approve a proposed purchaser of
a franchise. [REDACTED]
1
Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to
them in the Joint Brief Regarding Certain Issues Related to Proposed Plan of Reorganization and
Disclosure Statement, filed by the Lender Parties on June 11, 2010 (the “June 11 Brief”) or the Second
Amended Plan (as defined below), as appropriate.
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Despite the Debtor’s current contention that it has proposed the Second Amended
Plan in good faith, [REDACTED]
The minimum requirements for confirmation of a plan set forth in section 1129 of
the Bankruptcy Code require the Debtor to do significantly more than it has done here to satisfy
its fiduciary duties as a debtor in possession. Thus, the Second Amended Plan cannot be
confirmed.
The most basic failing of the Second Amended Plan is that, despite certain last-
minute superficial changes made by the Debtor, it continues to impair the substantial legal,
equitable, and contractual rights of the Lenders. To address the Court’s preliminary conclusion
that the Lenders’ claims could be rendered unimpaired under certain circumstances, the Debtor
responded by adding a single passage stating “[o]n and after the Effective Date, the holders of
Allowed [Class 2 and 3] Claims shall retain all existing contractual rights against the Debtor or
its affiliates to which they are entitled under the [Credit Agreements] and related documents.”
(Second Amended Plan at 12.) This single passage alone is not meaningful because the Lenders’
“existing rights” are fundamentally altered by numerous other provisions of the Second
Amended Plan, including, for example, the purported discharge of the Debtor, the expansive
releases and exculpation granted to various non-Debtor parties, and the sale of substantially all of
the Debtor’s assets. Based on the preliminary voting report the Lenders have received from the
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Debtor’s voting agent, the two Classes in which their Claims are classified have unanimously
rejected the Second Amended Plan.2 Thus, the Second Amended Plan fails the fundamental
requirement that there be at least one impaired accepting class of Claims.
This Court has also concluded that the original plan impaired the interests of the
Debtor’s equity holders. The Debtor has made no changes, superficial or otherwise, to attempt to
change that treatment. The Lender Parties believe that the Debtor’s equity holders, through their
Chief Restructuring Officer (the “CRO”), will also vote against the Second Amended Plan when
their vote is cast. The equity holders’ rejection of the Second Amended Plan has two fatal
implications for its confirmation: first, because the equity holders are not consenting to the
Second Amended Plan, the Debtor has a duty to maximize the value of its assets – which the
Debtor has not done by conducting an auction on three weeks’ notice following the concerted
efforts by the Debtor, MLB, and the Proposed Purchaser to chill the bidding; and second, the
Second Amended Plan must satisfy sections 1129(a)(7) and 1129(b) of the Bankruptcy Code,
which it does not.
The Second Amended Plan fails to comply with multiple other provisions of the
Bankruptcy Code, thus failing to satisfy sections 1129(a)(1) and 1129(a)(2) of the Bankruptcy
Code. The Second Amended Plan is the product of a series of backroom deals between
conflicted parties designed to benefit insiders, most notably, Tom Hicks, at the expense of the
Debtor’s creditors and other stakeholders. These deals, which were struck on the eve, and in
anticipation of, bankruptcy (subsequently referred to by the parties in interest as the “Midnight
Transfers”) and which are necessary predicates for the Second Amended Plan, when taken
2
The official voting report is not expected to be filed until after the deadline for filing this brief.
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together with the Debtor’s stated goal of [REDACTED] demonstrate that the Second Amended
Plan cannot meet the good faith requirement of section 1129(a)(3) of the Bankruptcy Code.
The Debtor also cannot show adequate means for implementing the Second
Amended Plan or that such plan is feasible. The Midnight Transfers included multiple void and
voidable transfers, certain of which are already being challenged by various parties, and others
that are subject to later challenge. If those transactions are avoided (and some of them, as
demonstrated below, are void ab initio), then the conditions precedent to the confirmation of the
Second Amended Plan cannot be fulfilled. Accordingly, the Second Amended Plan cannot be
implemented.3
The Greenberg Group’s unwavering rush to a confirmation hearing – like a
shopper who grabs a mistakenly underpriced item and runs to the cash register before someone
realizes the error – makes it practically impossible to hold a fair auction of the Texas Rangers,
and has the unfortunate consequence of harming the true stakeholders in this process: the
Lenders, the Debtor’s equity holders, and the Texas Rangers and their fans. Everyone is harmed,
except for the Greenberg Group, who will either (a) succeed in buying the Texas Rangers for less
than even it had been willing to pay, or (b) receive a windfall termination fee of at least $10
million to which it is not entitled under applicable law. 4
The Bankruptcy Code requires that the Court deny confirmation of the Second
Amended Plan.
3
Similarly, the Second Amended Plan requires the payment to Hicks of $5 million in respect of a so-
called “Overdraft Protection Line of Credit,” which cannot be paid because, in reality, it was an equity
infusion that the Lenders expect will be re-characterized as such.
4
The Lender Parties reserve the right to contest the enforceability of the Debtor’s purported obligation to
pay such fee.
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UPDATED STATEMENT OF RELEVANT FACTS
The Lender Parties hereby incorporate and respectfully refer the Court to the
relevant factual background set forth in detail in the June 11 Brief, including the description of
the Midnight Transfers. (See June 11 Brief at 4-19.) The following is a summary of the relevant
developments that have occurred since the filing of the June 11 Brief.
On June 22, 2010, the Court issued an opinion (the “Memorandum Opinion”)
with respect to the four questions briefed in the June 11 Brief. Among other things, the Court
determined that both the Claims in Classes 2 and 3 and the Equity Interests in Class 12 are
impaired, and suggested ways in which the then current plan dated June 17, 2010 (the “First
Amended Plan”) could be further modified to render the Claims in Classes 2 and 3 unimpaired.
(Memorandum Opinion at 25.) With respect to the Equity Interests, the Court specifically
determined that their prepetition approval of the original plan was insufficient to establish their
acceptance of the First Amended Plan. Therefore, the Equity Interests would need to vote on the
First Amended Plan or any subsequent iterations thereof. (Id. at 26-27.)
On June 25, 2010, the Debtor filed the Second Amended Plan, where it purported
to comply with the Court’s suggestions set forth in the Memorandum Opinion with respect to
rendering the Claims in Classes 2 and 3 unimpaired.5 On that same date, the Court scheduled the
confirmation hearing for July 9, 2010, and set July 2, 2010 as both the voting deadline and the
deadline for filing objections to the Second Amended Plan.6 On July 1, 2010, however, before
the Lender Parties had a chance to file their objection to the confirmation of the Second
Amended Plan, the Court rescheduled the confirmation hearing for July 22, 2010 and set July 15,
5
The Debtor failed to file an amended disclosure statement with respect to the Second Amended Plan.
6
See Order Granting Motion for Reconsideration, Resetting Mediation, and Resetting Hearing on
Confirmation [Docket No. 275], dated June 25, 2010.
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2010 as both the new voting deadline and the deadline for filing objections to the Second
Amended Plan.7
Thereafter, on July 5, 2010, the Debtor filed a motion [Docket No. 310] (the
“Initial Sale Motion”) seeking approval of certain bidding procedures (endorsed by the CRO) for
the sale of the Texas Rangers, with the May APA serving as a stalking horse bid. Before the
Lender Parties had an opportunity to file their objection to these bidding procedures, the CRO,
having determined that potential bidders required more time to become qualified bidders and to
obtain the necessary financing, and wishing to avoid a “one-legged auction” that was not “a fair
process” (Hr’g Tr. (July 20, 2010), at 24:22-26:7), withdrew his support of these bidding
procedures, and the Debtor had no choice but to withdraw the Initial Sale Motion.8
Thereafter, on July 13, 2010, the Debtor filed its second motion [Docket No. 352]
(the “Second Sale Motion”), seeking approval of slightly revised bidding procedures (the
“Debtor Bidding Procedures”). The day prior, in connection with the commencement of the
Proposed Purchaser Adversary9, Rangers Baseball Express LLC (the “Proposed Purchaser”) filed
an emergency motion for a preliminary injunction and temporary restraining order [Proposed
Purchaser Adversary, Docket No. 3] (the “TRO Request”), seeking to compel the Debtor to
comply with the May APA – a prepetition contract that has not been assumed by the Debtor. It
appears that another set of bidding procedures for the sale of the TRBP Assets (the “Purchaser
7
See Agreed Order Modifying Mediation Schedule and Resetting Hearing and Deadlines for
Confirmation of the Debtor’s Plan [Docket No. 304], dated July 1, 2010. The Court subsequently
rescheduled the confirmation hearing again for August 4, 2010 and set July 28, 2010 as the new deadline
for voting and filing confirmation objections. See Order Resetting Hearing on Confirmation of Debtor’s
Plan of reorganization and Related Deadlines [Docket No. 388], dated July 19, 2010.
8
See Debtor’s Notice of Withdrawal of Initial Sale Motion [Docket No. 326], dated July 8, 2010.
9
Rangers Baseball Express LLC v. Texas Rangers Baseball Partners, Adv. Pro. No. 10-04121 (July 12,
2010) (Lynn, J.) (the “Proposed Purchaser Adversary”).
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Bidding Procedures”) was attached to the TRO Request presented to the Court.10 At the hearing
on the TRO Request held on less than twenty-four hour notice (the “July 13 Hearing”), the
Court, sua sponte, proposed and adopted its own bidding procedures (the “Bidding Procedures”),
based almost entirely on the Purchaser Bidding Procedures.11 Despite the Lender Parties’
emergency motion to reconsider the Bidding Procedures [Docket No. 367] (the “Motion for
Reconsideration”), after almost three days of evidentiary hearings, the Court confirmed that the
Bidding Procedures will remain in place.
As set forth in detail in the Motion for Reconsideration, the Bidding Procedures
fail to establish a fair, open and competitive sale process in that they (a) establish an impossibly
abbreviated schedule on which the potential bidders have to make all the necessary arrangements
for their bids, 12 and (b) without any evidentiary support from a single estate fiduciary, provide
10
The Lender Parties were never served with the Purchaser Bidding Procedures (and they were not made
available on the docket), but, from the Court’s remarks at the July 13 Hearing (as defined below), it
appears that the Court did receive a copy and, indeed, used the Purchaser Bidding Procedures as its
template for the Bidding Procedures (as defined below).
11
See Order Adopting Bidding Procedures [Docket No. 363], dated July 15, 2010.
12
Under the Bidding Procedures, the potential bidders have less than three weeks to gain pre-approval
from the MLB, conduct their due diligence, obtain equity commitments, become sufficiently comfortable
with their ability to obtain financing that they post a non-refundable $15 million deposit, analyze the May
APA (including all the intricacies and implications of the Midnight Transfers that are inextricably tied
therewith) and negotiate an acceptable form thereof to constitute a qualified bid. See Hr’g Tr. (July 20,
2010), at 184:21-185:4 (“Q Do you believe that period of time that’s been provided for in the bid
procedures is adequate for alternative bidders to consider putting forth an alternative transaction? A
Look. Could somebody throw in a bid? Yes. Would it be the best bid you’re going to get? No. I think,
if I were advising a prospective buyer, and I’ve done it many times, I would tell the buyer that, given the
amount of time they have, they would not be able to do the level of due diligence they need to do to make
a reasoned bid here.”); see also Hr’g Tr. (July 20, 2010), at 44:8-14; Hr’g Tr. (July 22, 2010), at 36:7-13;
Hr’g Tr. (July 20, 2010), at 183:16-20.
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highly inappropriate and completely unnecessary bidding protections to the Proposed Purchaser
that could only further chill the bidding.13
Because the auction for the Texas Rangers is to be held a week after the deadline
for filing this brief, the Lender Parties do not know, as of this time, the outcome of the auction
or, for that matter, whether an auction will even be held. Given the compressed time that the
potential bidders were given under the Bidding Procedures, the Lender Parties have to assume
that either (i) no potential bidder (other than the Proposed Purchaser) would be in a position to
bid, or (ii) to the extent that any competing bid(s) is submitted, it likely would not be the best
possible bid that a potential bidder could have come forward with if it had been given an
appropriate amount of time.
ARGUMENT
It is axiomatic that “unless the so-called ‘cramdown’ provision of Section 1129(b)
is properly invoked, a plan may not be confirmed if even one of the requirements listed in
Section 1129(a) is not met.” Miller v. Broadway, No. 07-0122, 2007 U.S. Dist. LEXIS 93895, at
*8 (W.D. La. Dec. 19, 2007). The Debtor, as the proponent of the Second Amended Plan, bears
the burden of proof with respect to each and every element of section 1129. See, e.g., In re
Cypresswood Land Partners, I, 409 B.R. 396, 422 (Bankr. S.D. Tex. 2009) (citing In re Internet
Navigator Inc., 289 B.R. 128, 131 (Bankr. N.D. Iowa 2003)) (“The proponent of the plan bears
the burden of proof with respect to each element of §§ 1129(a) and 1129(b) under a
13
See Hr’g Tr. (July 22, 2010), at 70:2-5 (“Q What I’m asking you is, in order for there to be a bid for
the Rangers, is it necessary for the Rangers to offer a break-up fee? A No.”); Hr’g Tr. (July 20, 2010), at
191:11-14, 191:19-20 (“Q Mr. Galatioto, based on your discussions with other bidders in this case, what
effect do you think it would have on the bid process to have Mr. Greenberg have the protection of at least
$10 million worth of overbid value? . . . A I think it’s going to make it more difficult for any bidder,
obviously.”); Hr’g Tr. (July 20, 2010), at 39:14-18. (“So the only thing I think that’s a huge concern to
them would be the amount of the break-up fee, because they have to overbid that. . .And so that could be
an impediment.”)
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preponderance of the evidence standard.”).14 The Second Amended Plan cannot be confirmed
because it fails to comply not with just one, but at least with seven, elements of section 1129(a)
of the Bankruptcy Code. Specifically, as demonstrated below, the Second Amended Plan fails to
comply with sections 1129(a)(1), 1129(a)(2), 1129(a)(3), 1129(a)(5), 1129(a)(7), 1129(a)(10)
and 1129(a)(11) of the Bankruptcy Code. Moreover, because Classes 2, 3 (and presumably 12)
voted to reject the Second Amended Plan, the Court cannot confirm the Second Amended Plan
for its failure to comply with section 1129(a)(8).
Even were the Court to determine that section 1129(a)(8) is the only requirement
of section 1129(a) of the Bankruptcy Code that the Second Amended Plan fails to satisfy and
considers proceeding under section 1129(b) of the Bankruptcy Code,15 the Second Amended
Plan still cannot be confirmed because it fails to meet the requirements of that section as well.
I. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTIONS

1129(a)(7) AND 1129(a)(10)
A. Lenders’ Claims Are Impaired Within Definition of Impairment in

Memorandum Opinion
The Debtor has failed to remedy the impairment that the Court found to exist in
the First Amended Plan. In the Memorandum Opinion, the Court stated that to render the
Lenders’ claims unimpaired, the Debtor’s plan must, on and after the Effective Date, put the
Lenders in the position to exercise all of the rights under the Credit Agreements and the Pledge
14
While the preponderance of the evidence is the general standard, transactions involving insiders require
a higher level of scrutiny. In this case, due to the number of suspect insider transactions, a higher level of
scrutiny is justified. See Pepper v. Litton, 308 U.S. 295 (1939) ( fiduciaries are subject to “rigorous
scrutiny and where any of their contracts or engagements with the corporation is challenged, the burden is
on the [fiduciary] not only to prove the good faith of the transaction, but also to show its inherent fairness
from the viewpoint of the corporation and those interested therein….”); In re Herby’s Foods, Inc., 2 F.3d
128 (5th Cir. 1993) (holding that claims by insiders are subject to “rigorous scrutiny”).
15
The Lender Parties respectfully submit that the Court should decline to confirm the Second Amended
Plan under section 1129(b) of the Bankruptcy Code because the Debtor did not move for confirmation
under that section.
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Agreement that they enjoyed as of the Petition Date. The Second Amended Plan does not do this
and, as such, still fails to render the Lenders’ Claims unimpaired.
In its haste to ensure that the Texas Rangers are sold to the Proposed Purchaser,
the Debtor evidently did not properly analyze the Memorandum Opinion and failed to amend
the First Amended Plan in a way that would satisfy the Court’s mandate. The addition of an
entirely self-serving assertion in sections 4.2(b) and 4.3(b) of the Second Amended Plan that the
Lenders “shall retain all existing contractual rights against the Debtor and its affiliates to which
they are entitled by the [Credit Agreements] and related documents” is meaningless at best and is
belied by a plethora of other, more specific provisions of the Second Amended Plan that in fact
impair the Lenders’ rights.16
For example, if the Lenders are deprived of their right to withhold their consent
with respect to the disposition of their collateral in violation of section 4.4.1(c)(i)(1) of the
Pledge Agreement, they have, at the very least, a cause of action for the breach of that provision.
Yet, not only does the Second Amended Plan fail to preserve these rights, but numerous of its
provisions consistently purport to negate these valuable causes of action. Specifically, (i)
sections 4.2(b) and 4.3(b) of the Second Amended Plan each state unequivocally that the
distribution of the $75 million plus postpetition interest is “in full satisfaction, settlement, release
and discharge of” the “First Lien Holder Claims” and the “Second Lien Holder Claims,”
respectively;17 (ii) section 6.3 of the Second Amended Plan purports to “release” the Collateral
16
In addition, because the Lenders are the sole economic beneficiaries of the Equity Debtors, any post-
Effective Date damages awarded to the Lenders could only be paid from the Lenders’ own pockets. Such
treatment strips the Lenders of valuable rights without any meaningful recourse, thus resulting in
unquestionable impairment.
17
Each of these definitions covers “any Claim arising under or in connection with” their respective Credit
Agreements (emphasis added).
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Agent’s liens – even though the Court has clearly agreed with the Credit Parties that, even upon
the payment of the cash distribution, the Debtor would owe “Obligations” to the Lenders, all of
which constitute secured claims under the terms of the Credit Agreements and are entitled to the
benefit of the liens that secured them as of the Petition Date; (iii) section 11.3 of the Second
Amended Plan purports to discharge all Claims against the Debtor;18 and (iv) section 11.4 of the
Second Amended Plan purports to exculpate both the Debtor and some other potential
defendants from any liability for any actions taken since the Petition Date – a period during
which willful violations of the various provisions of the Credit Agreements continued. These
specific provisions of the Second Amended Plan have the clear effect of altering the rights that
the Lenders had vis-à-vis the Debtor and other parties as of the Petition Date, thus rendering the
Lenders’ Claims impaired.
B. Impairment of Lenders’ Claims Goes Further
Furthermore, the Lender Parties respectfully disagree with the Memorandum
Opinion on the issue of impairment, and respectfully submit that the Second Amended Plan
impairs Claims in Classes 2 and 3 in more ways than set forth above. Courts have held that the
Bankruptcy Code contains a presumption of impairment that has been interpreted to include even
minimal impairment. See In re M&S Assocs., Ltd., 138 B.R. 845, 853 (Bankr. W.D. Tex. 1992).
“Congress define[d] impairment in the broadest possible terms . . . .” L & J Anaheim Assocs. v.
Kawasaki Leasing Int’l, Inc. (In re L & J Anaheim Assocs.), 995 F.2d 940, 942 (9th Cir. 1993)
(citing In re Madison Hotel Assocs., 749 F.2d 410, 418 (7th Cir. 1984)). “[A]ny alteration of the
rights constitutes impairment even if the value of the rights is enhanced.” L & J, 995 F.2d at
942.
18
As discussed in Section II.B below, the Debtor obviously is not entitled to a discharge in any case.
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Section 1124 of the Bankruptcy Code provides, exclusively, two methods to
render a claim or interest “unimpaired,” either by leaving rights unaltered or by assumption and
cure. Section 1124(1) provides that a claim may be unimpaired if a plan “leaves unaltered the
legal, equitable, and contractual rights to which such claim or interest entitles the holder of such
claim or interest,” while section 1124(2) provides that notwithstanding any right to accelerated
payment, a claim may be unimpaired if a plan cures outstanding defaults, reinstates the maturity
of such claim or interest, compensates for pecuniary losses arising from non-monetary breaches,
and does not otherwise alter the legal, equitable, or contractual rights to which such claim or
interest entitles the holder of such claim or interest. 11 U.S.C. § 1124. Where, as here, the
Debtor does not propose to cure existing defaults as required by section 1124(2) of the
Bankruptcy Code, the only way to render a class of claims or interests unimpaired is by leaving
all rights of the claimants in such class unaltered, as required by section 1124(1) of the
Bankruptcy Code. A debtor arguing unimpairment pursuant to section 1124(1) has the burden of
proving that all rights of creditors in the relevant class remain unaltered by the plan.
For example, in L & J Anaheim Assocs., the Ninth Circuit analyzed whether a
proposed plan would impair a secured creditor where, under the proposed plan, that creditor’s
collateral would be sold at auction and the proceeds of such sale would be paid to the creditor.
995 F.2d at 941. In finding that such treatment constituted impairment, the court noted that,
under its credit and security documents, the creditor had the right to exercise all rights and
remedies under the California Uniform Commercial Code, which “was a contractual right for
which [the creditor] bargained in exchange for extending financing to [the debtor].” Id. at 943.
The proposed plan, premised as it was on a bankruptcy auction that left the creditor unable to
#4827-0637-1846 12
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invoke the “substantive remedies or procedural mechanism[]” available under applicable state
law, altered the creditor’s rights, leaving it impaired. Id.
Here, the Second Amended Plan provides treatment that alters the contractual
rights of the Lenders, and thus renders them impaired. The Debtor has two capacities under the
Credit Agreements: (i) it is a “Credit Party,” and as such it undertook a number of direct
obligations to the Lenders, and (ii) it is a “Guarantor,” and, in that capacity, it guaranteed a
limited portion of the borrower’s financial obligations under the Credit Agreements. In its role
as a Credit Party, the Debtor agreed to comply with specified covenants at all times until
repayment in full of all “Obligations” under the Credit Agreements. (See First Lien Credit
Agreement § 6.) While the repayment of $75,000,000 of the Obligations to the Lenders as
holders of Class 2 and 3 Claims as contemplated by the Second Amended Plan may satisfy the
Debtor’s guaranty of the Obligations of the other Credit Parties, it does not excuse the Debtor
from compliance with the various protective covenants set forth in the Credit Agreements.
The covenants set forth in the Credit Agreements were intended to protect the
Lenders’ right to repayment of up to $540 million of credit extended to HSG and its affiliates.
To that end, these covenants impose absolute limits on the Debtor’s ability to take actions that
are potentially detrimental to the Lenders’ rights, including the critical protection of requiring the
Lenders’ consent if the Debtor sought to dispose of significant assets. (First Lien Credit
Agreement § 6.9; Second Lien Credit Agreement § 6.9.) This particular covenant is a crucial
part of the Lenders’ bargain for as long as there remains any balance owing to the Lenders by
any of the Credit Parties, even if the $75 million portion of the Obligations that the Debtor
directly guaranteed has been paid in full. Indeed, this very covenant – together with
corresponding protections of the Pledge Agreement – is what protected the Lenders prepetition
#4827-0637-1846 13
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from having a below-market sale of the Debtor’s assets imposed on them. 19 The impairment of
the Lenders’ fundamental rights is clearly demonstrated by the simple fact that the Lenders had
the unquestioned right to consent to the sale of the Debtor’s assets before the Petition Date
(which restriction the Debtor cited as the reason it filed for bankruptcy),20 and the Second
Amended Plan deprives the Lenders of that right.21
C. Second Amended Plan Fails to Satisfy Section 1129(a)(10) of the

Bankruptcy Code
Section 1129(a)(10) provides that “[i]f a class of claim is impaired under the plan,
at least one class of claim that is impaired under the plan has accepted the plan.” 11 U.S.C. §
1129(a)(10).
As demonstrated above, Classes 2 and 3 are impaired under the Second Amended
Plan. Moreover, they are the only impaired classes of Claims under the Second Amended Plan.
Accordingly, for the Second Amended Plan to be confirmable under section 1129(a)(10), there
must be an affirmative vote of either Class 2 or Class 3. Because Classes 2 and 3 voted to reject
19
The Court inquired of counsel why the Lenders had not taken action prepetition to prevent the sale to
the Proposed Purchaser. (Hr’g Tr. (June 15, 2010), at 147:1-5.) Any such action was unnecessary given
that no party ever contested the Lenders’ prepetition consent right, and thus the Lenders did not have to
file a lawsuit to stop the sale. Furthermore, the Credit Agreements provide that no failure, delay, or
forbearance by the Agents to exercise any of their rights or powers constitutes a waiver of any such rights
or powers. (First Lien Credit Agreement, § 10.9; Second Lien Credit Agreement, § 10.9.) Finally, the
First Lien Agent delivered several reservation of rights letters to HSG, each of which was introduced into
the record at the June 15 hearing. (Hr’g Tr. (June 15, 2010), at 38:11-22.)
20
(See Hr’g Tr. (May 25, 2010) at 18:18-23); see also, [REDACTED]
21
The Lenders’ rights against the non-Debtor obligors under the Credit Agreements are further impaired
by the Debtor’s attempt to transfer title to the Lenders’ collateral free and clear of the Lenders’ liens.
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the Second Amended Plan, it fails to satisfy the requirements of section 1129(a)(10), and cannot
be confirmed.
D. Second Amended Plan Fails to Satisfy Section 1129(a)(7) of the

Bankruptcy Code
Section 1129(a)(7) of the Bankruptcy Code states that, with respect to any
impaired class of claims or interests, unless such class has accepted the plan, such class must, for
the plan to be confirmable, “receive or retain under the plan on account of such claim or interest
property of a value, as of the effective date of the plan, that is not less than the amount that such
holder would so receive or retain if the debtor were liquidated under chapter 7 of this title on
such date.” 11 U.S.C. § 1129(a)(7). Accordingly, because Classes 2, 3 (Claims) and 12
(Interests) are impaired and have rejected the Second Amended Plan, for the Second Amended
Plan to be confirmable, it has to comply with the foregoing “best interests” test. The Second
Amended Plan fails to comply with the best interests test and, thus, cannot be confirmed.
Simply stated, the best interests test requires the proponent of a plan to
demonstrate, with respect to each holder of an impaired claim or interest, either that (i) such
holder has voted in favor of the plan or (ii) such holder will “receive or retain on account of such
claim or interest, property of a value, as of the effective date of the plan, that is not less than the
amount that such holder would so receive . . . if the debtor were liquidated under chapter 7 . . . on
such date.” 11 U.S.C. § 1129(a)(7). As demonstrated above, the Second Amended Plan seeks to
strip valuable rights from the Lenders without any consideration. In a chapter 7 liquidation, the
Lenders would be entitled to a claim for monetary damages for these breaches. The Second
Amended Plan, however, proposes to cap the Lenders’ recovery at $75 million. Therefore, the
Debtors cannot satisfy the best interest test with respect to Classes 2 and 3.
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Furthermore, if this case were to be converted to chapter 7, it is very likely that
the chapter 7 trustee, with adequate time to allow potential bidders to put together their best bids,
would be able to sell the Texas Rangers at a purchase price higher than that proposed by the May
APA. As noted in the June 11 Brief, both Crane and the Greenberg Group were willing to pay
more cash for fewer assets when compared to the sale underlying the Second Amended Plan. As
the costs and expenses incurred by a chapter 7 trustee are unlikely to be very high, a chapter 7
liquidation should provide the holders of the Interests in Class 12 with more value than they
stand to receive under the Second Amended Plan.
II. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1129(A)(1)
The Second Amended Plan cannot be confirmed because it fails to comply with
section 1129(a)(1) of the Bankruptcy Code, which provides that a plan, to be confirmable, must
“comply with the applicable provisions” of the Bankruptcy Code. The Second Amended Plan
violates numerous applicable provisions of the Bankruptcy Code.
A. Second Amended Plan Violates Section 502(a) of the Bankruptcy Code
Since the Petition Date, the Lender Parties have consistently expressed their
concern that the Debtor’s management and other insiders have improperly influenced the
Debtor’s conduct to achieve ends that conflict with the best interests of the Debtor’s creditors
and other stakeholders. The Debtor now seeks confirmation of a plan that improperly abridges
the rights of parties in interest from objecting to allowance of insiders’ claims before any such
party has been given a fair opportunity to investigate such claims. The Debtor cannot justify a
premature termination of the investigation and objection rights of parties in interest in this
contested case. Accordingly, the provisions of the Second Amended Plan that purport to allow
#4827-0637-1846 16
REDACTED
certain claims while terminating the rights of the parties in interest to contest such allowance
violate section 502(a) of the Bankruptcy Code (additional evidence of the Debtor’s bad faith).
The Plan “allows” the following claims (collectively, the “Allowed Insider
Claims”):
• The Overdraft Protection Claim, a claim asserted by insider Thomas O. Hicks for
advances made under a purported loan. (See Second Amended Plan § 1.62.)22
• The MLB Prepetition Claim, a claim asserted by MLB for repayment of rescue
financing provided in connection with the Original VSA, an agreement that, as
amended by the Modified VSA, gave MLB control of the Debtor’s business and
the prepetition sale process. (See Second Amended Plan § 4.4(b).)
• The MLB Postpetition Claim, a claim asserted by MLB arising under agreements
between the Debtor and MLB pursuant to which MLB obtained control rights
over the Debtor’s business and reorganization. (See Second Amended Plan §
2.1.)
The Lender Parties submit that allowance of the Allowed Insider Claims under the
Second Amended Plan totally negates the procedures established under section 502 of the
Bankruptcy Code and violates due process. Pursuant to section 502(a) of the Bankruptcy Code,
any party in interest has the right to object to a claim asserted against the estate. Absent order of
the court, the ability of a party in interest to object to a prepetition claim is not time constrained.
U.S. v. Kolstad (In re Kolstad), 928 F.2d 171, 174 (5th Cir. 1991) (“There is no bar date or
deadline for filing objections.”). Under section 502(b) of the Bankruptcy Code, upon the
objection of a party in interest, the court must determine whether the claim should be allowed
#4827-0637-1846 17
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“after notice and a hearing.” In the context of a hearing on a claim objection, one court has
stated:
Due process mandates that there be an opportunity for some kind of hearing
before a person is finally deprived of his or her property, and that such hearing
occur at a meaningful time and in a meaningful manner. The contours of due
process are flexible, however, and the requirement of a hearing is limited to that
which is appropriate to the nature of the case.
Morton v. Morton (In re Morton), 298 B.R. 301, 307 (B.A.P. 6th Cir. 2003) (quoting Gallagher
& Ascher Co. v. Simon, 687 F.2d 1067, 1077 (7th Cir. 1982)).
With respect to most claims, the Debtor appears to understand the importance of
notice, a hearing and a meaningful opportunity for parties in interest to object. (See Second
Amended Plan § 8.2.) (“Except insofar as a Claim is Allowed under the Prepackaged Plan, the
Debtor, the Purchaser (to the extent the Claim is assumed under the Asset Purchase Agreement)
or any other party in interest shall be entitled to object to Claims.”) (emphasis added). However,
by specifically allowing the Allowed Insider Claims, the Second Amended Plan establishes a
different playing field for the Debtor’s insiders.
The Second Amended Plan’s allowance of the Allowed Insider Claims deprives
the CRO, the Lender Parties and all other parties in interest of their rights under section 502(a) of
the Bankruptcy Code and of due process.
B. Second Amended Plan Violates Section 524(e) of the Bankruptcy Code
The Second Amended Plan also violates section 524(e) of the Bankruptcy Code
by providing for illegal non-Debtor releases and impermissible indemnification provisions. See,
e.g., In re Wool Growers Cent. Storage Co., 371 B.R. 768 (Bankr. N.D. Tex. 2007) (denying
confirmation due to plan provisions which released directors from potential liability).
22
The Second Amended Plan purports to “allow” such claim despite the pending Objection to Overdraft
Protection Agreement Claim [Docket No. 375] filed by the First Lien Agent on July 16, 2010.
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In relevant part, the Second Amended Plan provides full exculpation to, among
others, the DIP Lender, the Proposed Purchaser, MLB, and their respective directors, officers,
employees, agents and representatives for any cause of action for any act taken or omitted to be
taken since the Petition Date. (Second Amended Plan § 11.4.) Similarly, section 11.7 of the
Second Amended Plan provides that all of the Debtor’s indemnification obligations to “its
partners or officers, or its direct or its indirect parent entities’ partners, members, shareholders,
managers, directors or officers, who were partners or officers of the Debtor or its direct or
indirect parent entities’ partners, members, shareholders, managers, directors or officers” shall
not be disputed and shall be assumed by the Post-Effective Date Debtor.
Both of these provisions of the Second Amended Plan violate well-settled Fifth
Circuit law.
1. Exculpation Provision Is Illegal Under Existing Fifth Circuit

Law
Section 11.4 of the Second Amended Plan (the “Exculpation Provision”) is
nothing more than an impermissible, disguised non-Debtor release which is impermissible in the
Fifth Circuit. The Fifth Circuit has made it clear on multiple occasions that a chapter 11 plan
cannot provide non-consensual non-Debtor releases and/or permanent injunctions. See Bank of
New York Trust Co. v. Official Unsecured Creditors’ Comm. (In re Pacific Lumber Co.), 584
F.3d 229, 252 (5th Cir. 2009) (noting the Fifth Circuit precedents “seem broadly to foreclose
non-consensual non-debtor releases and permanent injunctions.”); In re Pilgrim’s Pride Corp.,
2010 WL 200000, at *5 (“Because Pacific Lumber is binding precedent, the court may not, over
objection, approve through confirmation of the plan, third-party protections”).23
23
The Lender Parties are not asserting that the Exculpation Provision is impermissible as to any
“Committee.”
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The Exculpation Provision exculpates not only the Debtor, but also non-Debtor
parties such as MLB, the DIP Lender, the Purchaser, and each of their respective directors,
officers, partners, agents and advisors from “any [postpetition] act” in connection with this case,
the Second Amended Plan, or any contract, instrument, document or other agreement related
thereto.24 (See Exculpation Provision.) In addition, while the Exculpation Provision purports
to carve back claims for “willful misconduct, gross negligence, actual fraud, or criminal
conduct,” it would effectively exculpate the partners, directors and officers of the Debtor that
committed breaches of their duty of loyalty in the postpetition period.25 Absent the Exculpation
Provision, the Debtor’s partners, directors and officers would not have such protection.26
Furthermore, as to MLB and the Proposed Purchaser, there may be postpetition claims that could
be asserted against them. The Exculpation Provision, however, effectively releases all
postpetition claims against MLB and the Proposed Purchaser short of gross negligence, willful
misconduct, fraud or criminal conduct. There is no basis, either in fact or in law, to provide
24
In fact, as this Court has observed in connection with identical exculpation provision, the language in
the Second Amended Plan “also arguably may cover some actions taken by third parties prior to
bankruptcy in anticipation of bankruptcy.” In re Pilgrim’s Pride, 2010 WL 200000, at *2 fn. 6.
25
Section 152.204(a) of the Texas Business Organizations Code (“TBOC”) prescribes that a partner owes
to the partnership and the other parties both a duty of loyalty and a duty of care. Section 152.204(b) of
the TBOC further provides that “[a] partner shall discharge the partner’s duties to the partnership and the
other partners under this code or under the partnership agreement and exercise any rights and powers in
the conduct . . . of the partnership business . . . (1) in good faith and (2) in a manner the partner
reasonably believes to be in the best interest of the partnership.” A partner’s duty of loyalty has been
described as a “rule of undivided loyalty [that] is relentless and supreme.” West v. Seiffert (In re Houston
Drywall, Inc.), No. 05-95161-H4-7, 2008 Bankr. LEXIS 4060, at *99 (Bankr. S.D. Tex. July 10, 2008)
(quoting Meinhard v. Salmon, 164 N.E. 545, 548 (N.Y. 1928)).
26
Although the TRBP Partnership Agreement purports to supplant any conflicting provision of the Texas
Revised Partnership Act, Section 152.02 of the TBOC provides that a partnership agreement may not
eliminate any of the duties of loyalty or care or the obligation of good faith. See also, In re USA
Detergents, Inc., 418 B.R. 533, 545 (Bankr. D. Del. 2009) (holding that a breach of duty of loyalty claim
is not subject to the exculpation defense provided in the debtor’s corporate documents).
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either MLB or the Proposed Purchaser with any such protections. Accordingly, the Second
Amended Plan is unconfirmable because it contains an impermissible release of non-Debtors in
violation of section 524(e) of the Bankruptcy Code.
2. Indemnification Provision Is Impermissible
Section 11.7 of the Second Amended Plan (the “Indemnification Provision”) is
also impermissible under section 524(e) of the Bankruptcy Code as it too functions as an
impermissible third party release of the Lenders’ claims against the beneficiaries of
indemnification agreements with the Debtor. Under the Indemnification Provision, the Debtor
has attempted to enlarge the indemnification obligations to, among others, the Debtor’s partners,
directors and officers beyond those that existed immediately prior to the Debtor’s bankruptcy. In
connection with the Midnight Transfers, the Debtor entered into new indemnification agreements
with Lynn Nolan Ryan, Jr., Thomas O. Hicks, Lori McCutcheon, Thomas O. Hicks, Jr., Joseph
B. Armes and Mack H. Hicks, all Hicks affiliates. Additionally, the prior version of the Land
Sale Agreement was amended to add the Debtor as a party thereto for the first time, solely for the
purpose of indemnifying BRE and its affiliates, including Tom Hicks. (See Land Sale
Agreement at § 6.12.)
Under the Indemnification Provision, the Second Amended Plan obligates the
Post-Effective Date Debtor for the Debtor’s obligations under prepetition indemnification
agreements with affiliates including (i) the Debtor’s partners and officers and (ii) the officers,
directors or shareholders of the Debtor’s direct or indirect parent entities. Many of these
indemnification obligations did not even exist prior to the week of May 20, 2010.
Finally, the Indemnification Provision attempts to insulate the Midnight
Transfers from attack by, in essence, inserting a poison pill into the Second Amended Plan. That
is, if any indemnified person were to be sued, the Debtor will have an obligation to indemnify
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such person, and such obligation will be senior to the Lenders’ claims above $75 million. In
other words, if the Lender Parties were to sue any such indemnified person, any recovery they
might obtain would come out of their own pockets.
The Bankruptcy Code does not permit such provisions in a chapter 11 plan.
Consequently, the Second Amended Plan cannot be confirmed.
C. Second Amended Plan Violates Section 1141(d)(3) of the Bankruptcy

Code
Section 11.3 of the Second Amended Plan, in relevant part, provides:
Discharge of Claims
To the extent that the Debtor is entitled to a discharge, confirmation of the

Prepackaged Plan effects a discharge of all Claims against the Debtor. To the
fullest extent permitted by the applicable law (including, without limitation),
section 105 of the Bankruptcy Code, and except as otherwise specifically
provided herein, the treatment of all Claims against or Equity Interests in the
Debtor under the Prepackaged Plan shall be in exchange for and in complete
satisfaction, discharge and release of, all Claims against the Debtor of any nature
whatsoever, known or unknown, including any interest accrued or expenses
incurred thereon from and after the Commencement Date, or against its Estate or
property or interests in property. Except as otherwise provided in the
Prepackaged Plan, upon the Effective Date, all Claims against the Debtor shall be
satisfied, discharged and released in full in exchange for the consideration
provided under the Prepackaged Plan. Except as otherwise provided in the
Prepackaged Plan, all Persons shall be precluded from asserting against the
Debtor, the Purchaser, the Post-Effective Date Debtor, or their respective
properties or interests in property, any other Claims based upon any act or
omission, transaction or other activity of any kind or nature that occurred prior to
the Effective Date.
(Second Amended Plan § 11.3.)
This provision violates section 1141(d)(3) of the Bankruptcy Code, which, in
relevant part, provides that confirmation of a plan does not discharge a debtor if (a) the plan
provides for the liquidation of all or substantially all of the property of the estate; (b) the debtor
does not engage in business after consummation of the plan; and (c) the debtor would be denied
a discharge under section 727(a) if the case were a case under chapter 7 of the Bankruptcy Code.
#4827-0637-1846 22
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The Second Amended Plan provides for the liquidation of all or substantially all
of the Debtor’s assets. Also, the Debtor will not engage in business after the consummation of
the Second Amended Plan. Further, the Debtor would be denied a discharge under section
727(a)(1) of the Bankruptcy Code because the Debtor is not an individual. See 11 U.S.C §
727(a)(1) (providing that the Court shall grant the debtor a discharge unless the debtor is “not an
individual”). The “net effect of the provisions of § 1141(d)(3) is that a corporate debtor which is
liquidated under chapter 11 and does not continue in business after its chapter 11 plan goes into
effect does not receive a bankruptcy discharge.” In re Suncruz Casinos, LLC, 342 B.R. 370, 380
(Bankr. S.D. Fla. 2006). Accordingly, the Second Amended Plan is not confirmable because it
appears to provide the Debtor with an impermissible discharge.
D. Second Amended Plan Violates Section 1123(a)(5) of the Bankruptcy

Code
The legislative history of section 1129(a)(1), as well as applicable case law, make
it clear that the principal objective of this section is to ensure compliance with sections 1122 and
1123 of the Bankruptcy Code. See S. Rep. No. 95-989, at 126 (1978); H.H. Rep. No. 95-595, at
412 (1977); U.S. Code Cong. & Admin. News 1987, at pp. 5787, 5912, 6368. See also In re
Idearc Inc., 423 B.R. 138, 159 (Bankr. N.D. Tex. 2009). Section 1123(a)(5) requires that a plan
provides adequate means for its implementation, which the Second Amended Plan fails to do.27
1. Second Amended Plan Fails to Provide Adequate Means for

Implementation Regarding Compliance With May APA
The Second Amended Plan can only be implemented if the terms and conditions
of the May APA can be satisfied and the sale thereunder can be closed. Since many of the terms
27
When evaluating whether a plan contains adequate means for its implementation, courts “have
determined that the absence of an adequate means of implementation demonstrates a lack of good faith
thereby precluding confirmation of the plan of reorganization.” Crestar Bank v. Walker (In re Walker),
165 B.R. 994, 1003 (E.D. Va. 1994) (citing In re Sutton, 78 B.R. 341 (Bankr. S.D. Fla. 1987)).
#4827-0637-1846 23
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and conditions of the May APA cannot be satisfied, including, inter alia, conveyance of the
Ballpark Lease28 and the Centerfield Office Lease29 to the Proposed Purchaser, the Second
Amended Plan cannot be implemented.
Specifically, section 9.1 of the May APA provides for numerous conditions
precedent to the Proposed Purchaser’s obligations to close (the “Conditions Precedent”),
including that: (i) “[TRBP] shall have delivered, or caused to be delivered, to Purchasers a duly
executed Assignment and Assumption Agreement” (May APA at 9.1(i)); and (ii) “[TRBP] shall
have caused the Title Company to issue to Purchasers leasehold title policies for each Leased
Property, which title policies shall contain only those title exceptions agreed upon by [Proposed
Purchaser] in accordance with Section 7.15.” (May APA at 9.1(k).)
On May 22, 2010, two days before the Petition Date, the Debtor and Rangers
Ballpark executed an Assignment and Assumption Agreement, by which Rangers Ballpark
purported to assign to the Debtor its rights to the Ballpark Lease (the “Ballpark Transfer”) for
$10. On May 23, 2010, Emerald Diamond purported to transfer to the Debtor its rights, title and
interest to the Centerfield Office Property (the “Centerfield Office Transfer”).30 However, the
mortgage agreements with the Collateral Agent with respect to the Ballpark and the Centerfield
28
The “Ballpark Lease” is the lease of the Ballpark in Arlington from the City of Arlington and/or the
Arlington Sports Facilities Development Authority, Inc. (“ASFDA”). The Debtor’s leasehold interest in
the Ballpark Lease is subject to mortgages granted to each of the Agents for the benefit of the Lenders.
29
The centerfield office building, adjacent to the Ballpark, was constructed on the land leased from the
City of Arlington and/or ASFDA (the “Centerfield Office Lease” and, together with the office building,
the “Centerfield Office Property”). The Centerfield Office Property was also pledged as collateral to the
Lenders.
30
The Debtor claims that, as a consideration for the purchase, it issued to Emerald Diamond a promissory
note in the amount of $15,055,081. (See Disclosure Statement [Docket No. 34] at 5.)
#4827-0637-1846 24
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Office Property (the “Leasehold Deeds”) prohibit the Ballpark Transfer and the Centerfield
Office Transfer without the prior written consent of the Agents.31
Neither Rangers Ballpark, Emerald Diamond, nor TRBP obtained the consent of
the Collateral Agent to either the Ballpark Transfer or the Centerfield Office Lease Transfer. As
a result, these purported assignments were void under the terms of the respective Leasehold
Deeds. Therefore, the Ballpark Lease remains the property of Rangers Ballpark, and the
Centerfield Office Lease remains the property of Emerald Diamond, in each case, subject to the
Collateral Agent’s rights under the Leasehold Deeds and the Credit Agreements.32 Accordingly,
these leases are not part of TRBP’s estate, TRBP has no legal right to effectuate their transfer to
the Proposed Purchaser, and thus cannot satisfy the applicable Conditions Precedent. As such,
the Second Amended Plan fails to provide adequate means for its implementation. 33
2. Second Amended Plan Fails to Provide Proper Means of

Implementation Regarding Treatment of Class 8
For the Second Amended Plan to comply with the Court’s mandate expressed in
the Memorandum Opinion that the Lenders must be given exactly the same rights as they
31
Sections 3.11.1 of each Leasehold Deed provides as follows: “Unless required under the terms of the
[applicable lease], except as set forth in the Credit Agreement[s], [the lessee] shall not, without the prior
written consent of [the Agents] (which may be granted or withheld in [Agents’] reasonable discretion) (i)
terminate, or surrender the [applicable lease], or (ii) enter into any modification of the [applicable lease]
which materially impairs the practical realization of the security interest granted by this Deed of Trust,
and any such attempted termination, modification or surrender without [Agents’] written consent shall be
void.” (emphasis added)
32
The purported assignment of the Ballpark Lease was also not permitted under the terms of the Credit
Agreements. Certain of the Lenders have filed a Complaint seeking to avoid the assignment of the
Ballpark Lease as a fraudulent transfer. See Avery Point CLO, Ltd. v. Texas Rangers Baseball Partners,
No. 10-04098 (Bankr. N.D. Tex, June 11, 2010). See also Complaint, JPMorgan Chase Bank, N.A. v.
Rangers Ballpark LLC, No. 10-04124 (Bankr. N.D. Tex. July 16, 2010) (seeking declaratory judgment
that Ballpark Lease is not property of the Debtor’s estate).
33
In addition, the closing of the Land Sale Agreement is a condition precedent to the closing of the May
APA, while the payment in full of Hicks’ “claim” on account of the “Overdraft Protection Line of Credit”
is a condition precedent to the closing of the Land Sale Agreement.
#4827-0637-1846 25
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enjoyed as of the Petition Date, whatever causes of action the Lenders will have on the Effective
Date must be against the Debtor, not the Post-Effective Date Debtor, the latter being an entirely
distinct legal entity. See, e.g., In re Conseco, Inc., 330 B.R. 673, 682-83 (Bankr. N.D. Ill. 2005)
(“The reorganized debtor is in fact a new legal entity separate and distinct from the debtor ... ”).
As such, and at the very least, as of the Effective Date the Lenders must have an unliquidated
general unsecured claim in Class 8 of the Second Amended Plan.
The damages that the Lenders are entitled to assert against the Debtor are
potentially very significant.34 In light of this, until the Lenders’ damages claim against the
Debtor has been quantified, the Debtor cannot possibly promise payment in full to the holders of
allowed Claims in Class 8, let alone fail to provide for an adequate reserve for the payment of the
Lenders’ Class 8 Claim once it is allowed. Accordingly, the Second Amended Plan does not
provide adequate means for implementation. See, e.g., In re Fiesta Homes of Ga., Inc., 125 B.R.
321, 325 (Bankr. S.D. Ga. 1990) (refusing to confirm a plan where plan failed to provide
adequate means for consummating actions on which creditor recoveries depended).
3. Second Amended Plan, in Conjunction with Land Sale

Agreement, Authorizes an Improper Release of Valuable
Estate Causes of Action
As previously noted, on the eve of its chapter 11 filing, the Debtor became party
to the Land Sale Agreement for the sole purpose of granting a release in favor of BRE and its
affiliates, including Hicks, from all actions in any way related to BRE or its affiliates (the “BRE
34
These damages would equal at least the sum of (i) the difference between (x) the amount of the
purchase price payable to the Lenders by the Proposed Purchaser under the Second Amended Plan and (y)
the amount of the purchase price payable by potential higher and better offers plus (ii) all professional
fees and other charges incurred by the Lender Parties and the estate plus (iii) additional costs due to
interest and operating losses resulting from the delays of the sale that were necessary to enable the
Proposed Purchaser to raise capital at the time when there was at least one alternative bidder ready to
close.
#4827-0637-1846 26
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Release”). (See Land Sale Agreement § 6.12.) The BRE Release, for which the Second
Amended Plan is seeking the Court’s approval, amounts to an improper settlement of valuable
estate causes of action against corporate insiders and their affiliates for inadequate consideration
that cannot be approved under section 1123(b)(3)(a) and Bankruptcy Rule 9019. 35
For a bankruptcy court to approve a settlement, the Debtor must establish that the
settlement is fair, equitable, and in the best interests of the estate. Official Comm. of Unsecured
Creditors v. Cajun Elect. Power Coop., Inc. (In re Cajun Elect. Power Coop., Inc.), 119 F.3d 349,
355 (5th Cir. 1997) (citing Conn. Gen. Life Ins. Co. v. United Cos. Fin. Corp. (In re Foster
Mortgage Corp.), 68 F.3d 914, 917 (5th Cir. 1995)). The proponent of a settlement bears the
burden of proving that the settlement is fair and equitable and in the best interests of the estate.
In re Matco Elecs. Group, Inc., 287 B.R. 68, 75-76 (Bankr. N.D.N.Y. 2002); In re Trism, Inc.,
286 B.R. 744, 752 (Bankr. W.D. Mo. 2002). The court “may not simply accept a [proponent’s]
word that the settlement is reasonable, nor may [it] merely ‘rubber stamp’ a proposal.” Airline
Pilots Ass’n, Int’l v. American Nat’l Bank & Trust Co. (In re Ionosphere Clubs, Inc.), 156 B.R.
414, 426 (S.D.N.Y. 1993), aff'd, 17 F.3d 600 (2d Cir. 1994); see also In re Energy Coop., Inc.,
886 F.2d 921, 927 (7th Cir. 1989).
In assessing whether a settlement is in the best interests of the estate, the court
must consider: “(1) the probability of success of litigation; (2) the complexity and likely duration
of the litigation; any attendant expense, inconvenience, or delay; and possible problems
collecting a judgment; (3) the interest of creditors with proper deference to their reasonable
35
“The standards for approval of a settlement under section 1123 are generally the same as those under
Rule 9019, though the court should consider all factors relevant to a ‘full and fair assessment of the
wisdom of the proposed compromise.’” In re Coram Healthcare Corp., 315 B.R. 321, 334-35 (Bankr. D.
Del. 2004) (quoting Protective Comm. for Indep. Stockholders of TMT Trailer Ferry, Inc. v. Anderson,
390 U.S. 414, 424 (1968)).
#4827-0637-1846 27
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views; and (4) the extent to which the settlement is truly the product of arms-length
negotiations.” In re Mirant Corp., 348 B.R. 725, 739-40 (Bankr. N.D. Tex. 2006) (citing Cajun
Electric, 119 F.3d at 356; Foster Mortgage Corp., 68 F.3d at 917). In the Fifth Circuit, courts
“should carefully consider the wishes of the majority of the creditors.” Foster Mortgage Corp.,
68 F.3d at 917. “[I]n the bankruptcy context, the interests of the creditors not the debtors are
paramount.” Id.
Furthermore, courts are wary of settlements between a debtor and its affiliates,
particularly those persons that control the debtor. When the debtor proposes such a settlement,
“a bankruptcy court should carefully scrutinize the agreement.” Id. at 918. Thus, in In re Matco
Elects., 287 B.R. at 76, the court denied a settlement under Bankruptcy Rule 9019, citing the
following “red flags”: (i) the settlement was proposed not by a disinterested trustee, but by an
officer of the debtor who also held an ownership stake in the opposing party, (ii) the settlement
provided for the release of the debtor’s conflicted officers and (iii) the settlement provided for a
broad release of claims (subject to certain limited exceptions) against the opposing party in
which the debtor’s officer had an interest. Because the BRE Release is not fair and equitable, is
not in the best interests of the estate and bears all of the “red flags” identified by the court in
Matco, the Second Amended Plan violates Bankruptcy Rule 9019 and cannot be confirmed.
First, the BRE Release is not “fair and equitable” because it delivers value to
Hicks, the out-of-the-money equity holder of HSGH. To comply with the absolute priority rule,
the Lenders’ uncapped claims against the Equity Debtors, which are structurally senior to Hicks’
equity interest in HSGH, must be paid in full before any value flows to Hicks. Instead, the BRE
Release diverts value from the Debtor’s estate directly to Hicks by releasing him from viable
causes of action that would increase the value of the Debtor’s estate if asserted.
#4827-0637-1846 28
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Second, the BRE Release is not in the best interests of the estate because it was
negotiated on all sides by the Debtor’s conflicted Chairman and CEO, releases valuable causes
of action against a corporate insider and his affiliates for no consideration, and has drawn the
objection of key creditor constituents. An assessment of the four factors set forth in Mirant
confirms the impropriety of the BRE Release.
(1) The Probability of Success of Litigation
As an initial matter, the Debtor does not seek a settlement of identified causes of
action, but instead proposes a broad release of corporate insiders and their affiliates from all
causes of action in any way related to BRE. Even without adequate disclosure of the Debtor’s
causes of action in the Disclosure Statement, without the benefit of discovery, and without
investigation by the CRO, it is evident that the Debtor has valuable causes of action against the
BRE Released Parties that have high probabilities of success. For example, the Debtor’s estate
may have viable causes of actions against Hicks for breach of duty of loyalty for taking actions
as an officer and director of the Debtor, including (i) approving the Debtor’s entry into the May
APA, (ii) approving the Debtor’s participation in the Midnight Transfers, (iii) causing the Debtor
to pay past rent to the City of Arlington on behalf of BRE, (iv) usurping the Debtor’s corporate
opportunity to acquire lease, purchase option and development rights from City of Arlington in
respect of the land owned by BRE, and (v) causing the Debtor to enter into an above-market
aircraft lease on the eve of bankruptcy, for the benefit of an affiliate of Hicks.36
Additionally, the Debtor may have viable causes of action directly against BRE,
including (i) unjust enrichment and constructive trust for the Debtor’s satisfaction of BRE’s past
obligations under the City of Arlington lease, and (ii) contribution for the Debtor’s satisfaction of
36
Even with this arrangement modified by the First Amendment to Asset Purchase Agreement, dated as
of July 12, 2010, the terms of such lease are unduly burdensome for the estate.
#4827-0637-1846 29
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BRE’s past obligations under that certain Dispute Settlement Agreement dated April 27, 1999 by
and between the City of Arlington and ASFDA on the one hand, and Ballpark Real Estate, L.P.,
TRBP and Emerald Diamond on the other hand.
The Lender Parties believe that, at the very least, the Debtor could recover more
from pursuing these causes of action than it would from releasing them for no consideration
whatsoever.
(2) Complexity and Expense of Litigation
The causes of action identified above, which the Debtor proposes to release, are
not overly complex. The law regarding breach of fiduciary duty, contribution and unjust
enrichment is well-established. While the causes of action may be fact-intensive, the evidence
adduced at the Confirmation Hearing alone will establish liability in respect of certain of them.
Therefore, pursuit of the causes of action released under the BRE Release would not result in
significant expense or inconvenience.
(3) Interests of Creditors and Other Stakeholders
The interests of creditors and other stakeholders in this case weigh heavily against
approving the BRE Release. The best interests of creditors and stakeholders will not be served
by the Debtor’s release of valuable known causes of action, as well as potential unknown causes
of action, for no consideration. The Lender Parties vigorously object to the BRE Release. This
Court should give “proper deference to their reasonable views,” and refuse to give its approval to
the BRE Release through confirmation of the Second Amended Plan. Cajun Electric, 199 F.3d at
356.
#4827-0637-1846 30
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(4) Product of Arms-Length Negotiations
Finally, the BRE Release is clearly not the product of arms-length negotiations.
Hicks stood on all sides of the BRE Release, as (i) control person of the Debtor-releasor, (ii)
control person of BRE and (iii) an individual releasee. The lack of arms-length negotiation is
evidenced by the unfairness of the BRE Release, which releases valuable causes of action for
absolutely no consideration. In light of the foregoing factors, and the fact that the BRE Release
exhibits all of the “red flags” identified in Matco, the Debtor cannot meet its burden of proving
that the BRE Release is fair and in the best interests of the Debtor’s estate.
By making the effectiveness of these illegal transactions conditions precedent to
the effectiveness of the Second Amended Plan, the Debtor attempts to not only obtain the
Court’s imprimatur of its violations of state law, but also provide an effective discharge of its
management’s liability for such misconduct. Clearly, for this reason as well, the Second
Amended Plan fails to satisfy the good faith requirement of section 1129(a)(3).
III. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1129(A)(2)
For the Debtor, as the proponent of the Second Amended Plan, to comply with
section 1129(a)(2) of the Bankruptcy Code, it will have to demonstrate that it complied with
sections 1125 and 1126 of the Bankruptcy Code, as well as the Federal Rules of Bankruptcy
Procedure. See, e.g., Idearc, 423 B.R. at 163.
A. Debtor Lacked Authority to File Second Amended Plan in Violation of

Fed. R. Bankr. P. 9001
Rule 9001(5) of the Federal Rules of Bankruptcy Procedure provides that “[w]hen
any act is required by [the Federal Rules of Bankruptcy Procedure] to be performed by a debtor .
. . if the debtor is a partnership, ‘debtor’ includes any and all general partners or, if designated by
the court, any other person in control.” The Second Amended Plan violates this requirement
#4827-0637-1846 31
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because as a general partnership, the Debtor can only act through and at the direction of the
Equity Debtor. Yet, the Second Amended Plan is signed not by any of the Equity Debtors, but
by the Debtor’s CFO. Although the corporate resolutions attached to the Debtor’s petition
purports to provide such authorization, since such authorization occurred prior to the entry of the
order for relief for the Equity Debtors, such authorization is no longer effective. Moreover,
proposing or amending a reorganization plan in a chapter 11 is clearly not an ordinary course
action for any entity, and thus the Equity Debtors would have no authority to cause the Debtor to
file the Second Amended Plan without the CRO’s, and the Court’s, approval. 37 Absent such
approval, the filing of the Second Amended Plan was ultra vires and violates Rule 9001(5) of the
Federal Rules of Bankruptcy Procedure.38
B. Second Amended Plan Fails to Comply with Section 1125 of the

Bankruptcy Code
In addition to meeting the substantive requirements relating to content of the plan,
any modification to a chapter 11 plan also must meet the procedural requirements set forth in
section 1125 of the Bankruptcy Code. 11 U.S.C. § 1127(c) (“the proponent of a modification
shall comply with section 1125 of this title with respect to the plan as modified”) (emphasis
added). Additionally, “[t]he plan, as modified, shall become the plan only after there has been
disclosure under section 1125 as the court may direct, notice and a hearing, and such
modification is approved.” Id. at § 1127(f)(2) (emphasis added).
37
The Debtor filed the Second Amended Plan on June 25, 2010, three days after Rangers Equity stated on
the record that it would appoint the CRO over its cases. (Hr’g Tr. (June 22, 2010), at 17:23-18:7.)
38
In addition, such unauthorized filing of the Second Amended Plan may well constitute yet another
violation of section 1129(a)(3) of the Bankruptcy Code because it means that the Second Amended Plan
was proposed “by means forbidden by law.”
#4827-0637-1846 32
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Section 1125 sets forth the requirements for plan disclosure and solicitation, and
provides (among other things) that the plan proponent must provide “adequate information” to
the parties in interest. Id. at § 1125(b). Before a plan proponent solicits votes for a modified
plan, it must make adequate disclosure and such disclosure must be approved by the court “after
notice and a hearing.” Id. at § 1125(b).
The Debtor, as the proponent of the Second Amended Plan, has failed to both
provide adequate disclosure in connection therewith and to properly solicit votes thereon.
First, the Second Amended Plan modifies the First Amended Plan in a manner
that may materially change the treatment of creditors and interest holders. Yet, the Debtor has
not filed a revised disclosure statement with respect to the Second Amended Plan, let alone
requested a hearing to address the adequacy of any additional disclosure. Because the Court has
not approved a revised disclosure statement after notice and hearing, the Debtor has failed to
meet the requirements of section 1125(b) of the Bankruptcy Code. Thus, the Second Amended
Plan cannot be confirmed.
Second, the Debtor has not properly solicited votes with respect to the Second
Amended Plan. Because this Court has not approved a revised disclosure statement, it goes
without saying that the Debtor has not conducted a solicitation of votes on the Second Amended
Plan that complies with section 1125(b) of the Bankruptcy Code. The solicitation that the Debtor
commenced on June 21, 2010 is with respect to the First Amended Plan, which is potentially
materially different from the Second Amended Plan. Because of these deficiencies, the Debtor
has failed to comply with section 1125 of the Bankruptcy Code.
C. Debtor’s Conduct Violates Due Process
Because of the violation of section 1125 of the Bankruptcy Code described
above, the Debtor, as the plan proponent, has failed to comport with the most basic elements of
#4827-0637-1846 33
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due process, rendering the voting and confirmation process with respect to the Second Amended
Plan constitutionally deficient. Impaired creditors and interest holders have an absolute
constitutional right to vote on a plan of reorganization. See In re 50-Off Stores, Inc., 231 B.R.
592, 595 (Bankr. W.D. Tex. 1999) (“Creditors who are deprived of the opportunity to vote
against a given plan are deprived of their due process rights under the Constitution”). Yet, no
vote that was solicited prior to the filing of the Second Amended Plan has any relevance today.
The Second Amended Plan is materially different than the previous versions thereof described in
the solicitation materials approved by this Court and distributed to the holders of claims and
interests in Classes 2, 3 and 12 back in June.
Simply put, creditors and interest holders have not received adequate information
about the Second Amended Plan sufficient to satisfy constitutional due process.
IV. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1129(A)(3)
The Second Amended Plan also violates section 1129(a)(3) which requires that it
be proposed in good faith and not by any means forbidden by law. 11 U.S.C. § 1129(a)(3). To
be deemed to have been proposed in good faith, a plan must “fairly achieve a result consistent
with the [Bankruptcy] Code.” In re Block Shim Dev. Co.-Irving, 939 F.2d 289, 292 (5th Cir.
1991) (citing In re Madison Hotel Assocs., 749 F.2d 410, 425 (7th Cir. 1984)). The inquiry
considers the totality of the circumstances to determine whether the plan was proposed with the
legitimate and honest purpose and has a reasonable hope of success. B.M. Brite v. Sun Country
Dev., Inc. (In re Sun Country Dev., Inc.), 764 F.2d 406, 408 (5th Cir. 1985). The plan proponent
has the burden of proof to show that the plan is proposed in good faith by a preponderance of the
evidence. See Fin. Sec. Assurance, Inc. v. T-H New Orleans Ltd. P’ship (In re T-H New Orleans
Ltd P’ship), 116 F.3d 790, 802 (5th Cir. 1997). The requirement for the plan proponent to
#4827-0637-1846 34
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demonstrate that it has satisfied its burden of proving that the plan was proposed in good faith
applies whether or not there are any impaired classes of claims or interests. See In re Wonder
Corp. of America, 70 B.R. 1018, 1023 (Bankr. D. Conn. 1987) (determining that even though the
objecting creditor is unimpaired, the court still had a responsibility to determine whether the plan
satisfies the provisions of §1129).
Here, the evidence clearly shows that the Debtor did not propose the Second
Amended Plan for a legitimate purpose. Rather, acting under the control and direction of the
MLB and to satisfy Hicks’ pecuniary interests, the Debtor proposed the Second Amended Plan
as an improper means to vitiate the Lenders’ legitimate rights under the credit documents, while
obtaining the Court’s imprimatur of the highly improper Midnight Transfers, including the
fraudulent transfers and blatant violations of the management’s fiduciary duties embodied
therein. As such, the Debtor cannot possibly carry its burden of proof with respect to compliance
with section 1129(a)(3).
A. Second Amended Plan Is a Bad Faith Attempt to Vitiate Lenders’

Rights under Pledge Agreement
The Pledge Agreement requires the Collateral Agent’s consent to the sale of the
Texas Rangers. Even though the Court stated in the Memorandum Opinion that such right may
be taken away upon a bankruptcy filing,39 there can be no argument that it was in full force and
effect prepetition, when the May APA was executed.40
39
Memorandum Opinion at 19-20. The Lender Parties respectfully disagree with this conclusion and
believe that any final order should not contain this conclusion.
40
As explained in detail in the June 11 Brief, because an Event of Default under the Credit Agreements
occurred on or about March 31, 2009, all Voting and Consent Rights with respect to the Relevant Equity
Interests, including the TRBP Interests, automatically ceased and vested solely in the Collateral Agent.
(Pledge Agreement § 4.4.2(c)(i)(3)(A).) Consequently, as of such time, the Collateral Agent was the only
entity with authority to consent to a sale of substantially all of TRBP’s assets. Further, even absent an
Event of Default, the Voting and Consent Rights of the Equity Debtors were limited by certain
#4827-0637-1846 35
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Accordingly, the Debtor’s prepetition execution of the May APA, as well the
attempted Ballpark Transfer and Centerfield Office Transfer, each without the Collateral Agent’s
consent, was a violation of the Lenders’ bargained-for rights, and the Debtor’s attempt to now
benefit from such willful violation of its contractual obligations by effectuating the May APA
through the Second Amended Plan is a bad faith attempt to circumvent such rights.
B. Second Amended Plan Is a Bad Faith Attempt to Obtain Approval of

Transactions Violating State Law
On both an individual and collective basis, the Midnight Transfers had the effect
of increasing the Debtor’s liabilities and reducing its assets. Currently available evidence
establishes that the Midnight Transfers were purposefully designed to benefit the Debtor’s
current owners and management, as well as the Purchaser, all to the detriment of the Lenders, by
taking assets that would otherwise be available to satisfy their claims out of the Lenders’ reach,
while saddling the Debtor with liabilities for which it had not been previously liable, and which
it had no legal obligation to assume.41 Many of these Midnight Transfers were illegal under
applicable state law.
Both Delaware and Texas have adopted the Uniform Fraudulent Transfer Act
(“UFTA”), which establishes a cause of action for actual or constructive fraudulent transfers.
restrictions and covenants in the Pledge Agreement that prevented them from selling the Texas Rangers
without the First Lien Lenders’ consent. Section 4.4.1 of the Pledge Agreement requires the Equity
Debtors to give the Collateral Agent written notice prior to exercising any Voting and Consent Rights
with respect to the TRBP Interests, and provides the Collateral Agent with veto rights upon receiving
such notice. (Pledge Agreement § 4.4.1(c)(i)(1).) Furthermore, while section 11 of the Pledge
Agreement contains an acknowledgement by the Collateral Agent that any sale of the Texas Rangers is
subject to the approval by MLB, that acknowledgement does not deprive the Collateral Agent of its
Voting and Consent Rights with respect to the Relevant Equity Interests or eliminate the requirement
under the Pledge Agreement that the Equity Debtors obtain the Collateral Agent’s written consent prior to
selling the Texas Rangers. Rather, they are separate and wholly independent requirements.
41
See, e.g., MLB [REDACTED]
#4827-0637-1846 36
REDACTED
See Del. Code Ann. Tit. 6 §1307(a)(1); Tex. Bus. & Com. Code § 24.008(a)(1). The UFTA
provides, in relevant part:
(a) A transfer made or obligation incurred by a debtor is fraudulent as to a

creditor, whether the creditor’s claim arose before or after the transfer was made
or the obligation was incurred, if the debtor made the transfer or incurred the
obligation:
(1) With actual intent to hinder, delay or defraud any creditor of the
debtor; or
(2) Without receiving a reasonably equivalent value in exchange for the
transfer or obligation, and the debtor:
a. Was engaged or was about to engage in a business or a
transaction for which the remaining assets of the debtor were
unreasonably small in relation to the business or transaction; or
b. Intended to incur, or believed or reasonably should have
believed that the debtor would incur, debts beyond the
debtor’s ability to pay as they became due.
Del. Code Ann. Tit. 6 §1304(a); see also Tex. Bus. & Com. Code § 24.005(a). Simply stated,
“[t]he UFTA provides remedies to creditors who are defrauded by debtors who transfer assets or
incur obligations with actual intent to hinder delay or defraud any creditor of the debtor, or, in
certain circumstances, without receiving reasonably equivalent value.” August v. August, 2009
WL 458778, at *10 (Del. Ch. Feb. 20, 2009). These remedies include, among other things,
avoidance of the transfers at issue.42 See Rodriguez v. Drive Financial Servs., L.P. (In re Trout),
--- F.3d ----, 2010 WL 2510427, at * 6 (10th Cir. June 23, 2010) (holding that under analogous
provision of the Bankruptcy Code, “the default rule is the return of the property itself”).
First, the Ballpark Lease was transferred from Rangers Ballpark to the Debtor,
with Rangers Ballpark receiving virtually no consideration for its valuable leasehold rights. This
blatant attempt by the Debtor and its management to move a valuable asset away from an entity
42
Certain of the Lenders have filed an adversary proceeding seeking avoidance of certain of these
transfers as both actually and constructively fraudulent. Because avoidance is appropriate in either case,
the Lenders focus here on the prima facie constructively fraudulent transfers.
#4827-0637-1846 37
REDACTED
with no cap on its obligations to the Lenders to the Debtor, whose pecuniary obligation to the
Lenders is capped at $75 million, is already subject to two adversary proceedings instituted by
certain of the Lender Parties, and is likely to be unwound (or determined to have been void ab
initio as provided in the Leasehold Deeds).
Second, the Centerfield Office Transfer occurred without any attempt to market
the assets involved.43 There is no evidence that the approximately $15 million promissory note
received by Emerald Diamond, another entity obligated to the Lenders for the full amount of the
Obligations, constitutes fair value for them. Accordingly, this transaction also constitutes a
potentially fraudulent transfer or is void ab initio as provided in the Leasehold Deeds.
Third, the Land Sale Agreement was amended on the eve of the bankruptcy filing
for the sole purpose of obligating the Debtor, that was not previously a party to the Land Sale
Agreement and that obtained no incremental benefit from becoming a party, to pay the fees and
expenses of BRE and its affiliates, including Thomas Hicks. TRBP’s incurrence of this
obligation constitutes yet another fraudulent transfer and is subject to a pending objection.44
C. Second Amended Plan Was Proposed in Bad Faith Because It

Sanctions Violations of Fiduciary Duties
The multiple breaches of the Debtor’s management’s fiduciary duties in
formulating the Second Amended Plan and related transactions further supports a finding of bad
faith under section 1129(a)(3). “[A] demonstration of a breach of fiduciary duty by officers or
directors of a debtor may certainly defeat the confirmability of the debtors’ plan on lack of good
43
(See Hr’g Tr. (July 22, 2010), at 41:15-18) (“Q Were you asked to offer an opinion on the value of the
centerfield office building that was transferred from Emerald Diamond to the Texas Rangers Baseball
Partners? A No.”)
44
See Objection of First Lien Agent to Claims of Financial Advisors [Docket No. 377], dated July 16,
2010.
#4827-0637-1846 38
REDACTED
faith grounds.” In re TCI 2 Holdings, LLC, 2010 Bankr. LEXIS 1169, at *50 (Bankr. D.N.J.
Apr. 12, 2010) (citing In re Coram Healthcare Corp., 271 B.R. 228 (Bankr. D. Del. 2001)) (no
finding of lack of good faith where court found no breach of fiduciary duty).
1. Debtor’s Management Violated Its Duty of Loyalty
A debtor in possession is bound by a duty of loyalty that includes an obligation to
refrain from self dealing and to avoid conflicts of interest and the appearance of impropriety.
See, e.g., Lopez-Stubbe v. Rodriguez-Estrada (In re San Juan Hotel Corp.), 847 F.2d 931, 950
(1st Cir. 1988); Bennett v. Gemmill (In re Combined Metals Reduction Co.), 557 F.2d 179, 196-
97 (9th Cir. 1977). As articulated by the Supreme Court, the duty of loyalty owed by a debtor in
possession is also owed by its senior officers:
[S]o long as the Debtor remains in possession, it is clear that the corporation bears
essentially the same fiduciary obligation to the creditors as does the trustee for the
Debtor out of possession. Moreover, the duties which the corporate Debtor in
possession must perform during the proceeding are substantially those imposed
upon the trustee. It is equally apparent that in practice these fiduciary
responsibilities fall not upon the inanimate corporation, but upon the officers and
managing employees who must conduct the Debtor’s affairs under the
surveillance of the court. If, therefore-as seems beyond dispute from the very
terms of the statute-the trustee is himself a fiduciary . . . logic and consistency
would certainly suggest that those who perform similar tasks and incur like
obligations to the creditors and shareholders should not be treated differently
under the statute for this purpose.
Wolf v. Weinstein, 372 U.S. 633, 649-50 (1963).
Because the Debtor’s management is clearly conflicted (as described in detail in
the June 11 Brief), they were incapable of negotiating any of the Midnight Transfers or
proposing a plan incorporating them. This conflict is precisely the reason that the Court has
appointed the CRO to act on the Equity Debtors’ behalf. It is well-established that an
authorization by officers or directors of a transaction involving an actual conflict of interest
violates their fiduciary duties. Prepetition such duties are owed to the corporation and its
#4827-0637-1846 39
REDACTED
shareholders according to applicable state law. See Gearhart Indus., Inc. v. Smith Int’l, Inc., 741
F.2d 707, 719 (5th Cir. 1984). “Of course, once a petition is filed in bankruptcy, the debtor-in-
possession has these obligations to the equity owners and to the creditors.” Unsecured Creditors
Comm. v. General Homes Corp. (In re General Homes Corp.), 199 B.R. 148, 151 (S.D. Tex.
1996); see also Nat’l Convenience Stores Inc. v. Shields (In re Schepps Food Stores, Inc.), 160
B.R. 792, 797 (Bankr. S.D. Tex. 1993) (“Upon the filing of a bankruptcy . . . these duties do not
discontinue.”).
Under Texas law, fiduciary duties include a duty of loyalty which holds officers
and directors to an “extreme measure of candor, unselfishness and good faith,” particularly
where there is an interested transaction. Int’l Bankers Life Ins. Co. v. Holloway, 368 S.W.2d
567, 577 (Tex. 1963); see Gearhart Indus., Inc., 741 F.2d at 719-20. In a transaction involving a
conflict of interest, an officer or director may not rely upon the business judgment rule as a
defense. See Resolution Trust Corp. v. Acton, 844 F. Supp. 307, 314 (N.D. Tex. 1994).
“Furthermore, the business judgment rule may be wholly inapplicable in a case where the
corporation is insolvent.” Mims v. Kennedy Capital Mgmt., Inc. (In re Performance Nutrition,
Inc.), 239 B.R. 93, 111 (Bankr. N.D. Tex. 1999) (citing In re General Homes Corp., 199 B.R. at
151-52).
The Debtor’s management breached its fiduciary duty of loyalty by allowing
Hicks’s personal interests to prevail over the Debtor’s interests. The Midnight Transfers were
designed to foreclose the possibility of a sale to any purchaser other than the Proposed Purchaser.
At the same time, Hicks stands to receive a one percent stake in the Texas Rangers, repayment of
the so-called “Overdraft Protection,” more than $70 million in cash, full indemnification, as well
as “certain perquisites . . . customary to former owners . . . of professional sports teams”
#4827-0637-1846 40
REDACTED
including season tickets and parking passes, and the title of Chairman Emeritus for three years.
(Disclosure Statement at I.E.2.) Purportedly, these benefits are on account of the sale of the BRE
Property. Without an independent valuation, however, it is impossible to verify whether such
benefits relate to the sale of the BRE Property or are proceeds of the sale of the Texas Rangers
that have been diverted to Hicks for his personal gain. As noted above, the duty of loyalty
includes the obligation to avoid even the appearance of impropriety. See In re Coram
Healthcare Corp., 271 B.R. at 235. Accordingly, Hicks breached the duty of loyalty he owed the
Debtor when he advanced his own personal interests over the interest of the Texas Rangers
which required him to seek the highest and best offer for its assets. See Performance Nutrition,
239 B.R. at 111.
In Performance Nutrition, a bankruptcy court held that the President and CEO of
the debtor had breached his duty of loyalty when he conspired to force a sale of the debtor’s
assets to one of the debtor’s vendors without first obtaining a valuation and shopping the assets
on the open market. Performance Nutrition, 239 B.R. at 111-12. The court found that he
orchestrated the sale in order to obtain a favorable employment package with the purchaser. 239
B.R. at 109. Similarly, Hicks, negotiating on behalf of the Debtor, breached his duty of loyalty
by failing to appropriately market the Debtor’s business due to his interest in securing personal
benefits.
When considering the totality of circumstances surrounding a proposed plan,
courts consider conflicts of interest by a debtors’ officers that would prevent the officer from
proposing a plan in good faith under 1129(a)(3). Coram Healthcare, 271 B.R. at 240 (“[A]
continuous conflict of interest by the CEO of the Debtor precludes the Debtors from proposing a
plan in good faith under 1129(a)(3).”); In re Allied Gaming Mgmt., Inc., 209 B.R. 201, 203
#4827-0637-1846 41
REDACTED
(Bankr. W.D. La. 1997) (debtor’s former accountant and general manager could not acquire
estate property under reorganization plan because there is an absolute bar on fiduciaries
acquiring estate property and it “create[d] an impermissible appearance of impropriety”); In re
Grodel Mfg., Inc., 33 B.R. 693, 696 (Bankr. D. Conn. 1983) (former trustee could not purchase
stock in a reorganized company under a proposed plan of reorganization, based upon the
appearance of impropriety).
As a result of such fundamental conflicts of interest, the Second Amended Plan
fails to satisfy section 1129(a)(3) of the Bankruptcy Code.
2. Debtor Violated Its Duty to Maximize Value
In the Memorandum Opinion, the Court concluded that the Debtor had no
obligation to maximize estate value where its creditors were being paid in full and equity
consented to receive a potentially smaller distribution than it may have been entitled to.45
(Memorandum Opinion at 19-20.) Accordingly, if the CRO votes to reject the Second Amended
Plan on behalf of the Equity Debtors, any prepetition consent that they may have given has been
abrogated, and the solvent Debtor’s obligation to maximize value for the holders of its equity
interests would continue to apply.
The Second Amended Plan clearly fails to maximize the value of the Debtor’s
estate. Indeed, the Debtor’s counsel has acknowledged that this case was filed with the express
purpose of [REDACTED] When a debtor
intends to sell an asset, “its main responsibility, and the primary concern of the bankruptcy court,
is the maximization of the value of the asset sold.” In re Embrace Sys. Corp., 178 B.R. 112, 123
(Bankr. W.D. Mich. 1995). Sale of an estate asset pursuant to an open, fair, competitive process
45
The Lender Parties respectfully reserve their right to dispute this conclusion.
#4827-0637-1846 42
REDACTED
is the most effective way to obtain the highest and best offer because “competitive markets are
the assurance of bona fide sales for highest value.” In re Gulf Coast Oil Corp., 404 B.R. 407,
424 (Bankr. S.D. Tex. 2009) (noting that the asset purchase agreement at issue “should clearly be
designed to facilitate competitive bidding.”).46
The need for a competitive bidding process is particularly acute where, as here,
the proposed sale, which the Debtor tried to shield from higher and better offers, “smacks of a
‘sweetheart deal’” that was motivated by the self-interest of the debtor’s management, insiders or
affiliates. In re Embrace, 178 B.R. at 126-27 (denying deal to insiders that had not been tested at
“an auction sale which permits competitive bidding.”). In a case that presented similar
circumstances of self-dealing, a bankruptcy court found it “astounding” that the debtor had
entered into a purchase agreement that benefited its management and insiders and that sought to
restrict the debtor’s ability to “test the marketplace for other expressions of interest.” In re
Bidermann Indus. U.S.A. Inc., 203 B.R. 547, 551-52 (Bankr. S.D.N.Y. 1997). The Bidermann
court observed that the sale process “should have followed an intensive effort to drum up the best
price obtainable,” yet was hampered by the “illicit manipulation of a board’s deliberative process
by self-interested corporate fiduciaries.” Id. at 551, 552 (internal citation and quotation marks
omitted).
The fact that the Bidding Procedures were ultimately modified (and undoubtedly
improved) by the Court was, unfortunately, not sufficient to rectify the glaring deficiencies that
46
Moreover, in furtherance of the duty to maximize estate value, the bankruptcy court should decline to
enforce prepetition agreements that prevent the debtor from obtaining the best price possible for its assets.
See, e.g., In re Big Rivers Elec. Corp., 233 B.R. 726, 734-36 (Bankr. W.D. Ky. 1998) (holding that
prepetition omnibus agreement between debtor and prospective purchaser, which contained “no shop”
provision prohibiting debtor from soliciting better offers, was “void and unenforceable” because it
violated debtor’s fiduciary duty to estate, especially where competing bid would provide $50 million of
additional value to creditors), aff’d, 233 B.R. 739 (W.D. Ky. 1998).
#4827-0637-1846 43
REDACTED
were – by that time – built into the process. The unrealistically short time frame in which
potential bidders had to formulate and negotiate their bids, as well as having a stalking horse bid
distorted with the insider deals and liabilities that needed to be untangled made it highly unlikely
that any auction based on such procedures would yield the purchase price accurately reflecting
the true value of the Debtor’s assets. Thus, the Bidding Procedures cannot support the finding of
fairness with respect to the sale process and cannot help the Debtor meet its burden of
establishing that it maximized the value of its estate.47
V. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1129(A)(5)
Section 1129(a)(5) of the Bankruptcy Code requires debtors to disclose the nature
of any compensation to an insider before plan confirmation. 11 U.S.C. § 1129(a)(5)(b). Insiders
include directors and officers of a debtor corporation. 11 U.S.C. § 101(31)(B). Moreover, courts
have held that while the adequacy of disclosure varies depending on circumstance, at a minimum
the disclosure statement must contain certain information “including compensation to be paid to
any insiders, directors, and/or officers.” In re Scioto Valley Mortgage Co., 88 B.R. 168, 172
(Bankr. S.D. Ohio 1988). See also In re Polytherm Indus., Inc., 33 B.R. 823, 829 (W.D. Wis.
1983) (case remanded where record did not contain proposed compensation of insiders in
reorganized corporation). See generally 7 COLLIER ON BANKRUPTCY ¶ 1129.02[5] (Alan N.
47
Furthermore, where, as here, the transaction was tainted by the self-interestedness of the Debtor’s CEO
and Chairman of the Board, Texas state law demands that the self-interested director prove the fairness of
the transaction to shareholders. See Gearhart Indus., Inc., 741 F.2d at 720 (“[T]he burden of proof is on
the interested director to show that the action under fire is fair to the corporation.”); In re Performance
Nutrition, Inc., 239 B.R. at 110 (“The burden is on the officer or director to show that the transaction was
fair to the corporation.”). Because BRE, an affiliate of the Debtor’s CEO Hicks, is selling assets to the
Purchaser in connection with the May APA, the Court must scrutinize the transaction to determine
whether Hicks fulfilled his fiduciary duties to maximize the value of the Debtor’s estate, or whether he
abdicated such duty in favor of higher recovery for BRE. See Mission Iowa Wind Co. v. Enron Corp.,
291 B.R. 39 (S.D.N.Y. 2003) (remanding order approving sale of substantially all assets to bankruptcy
court for determination of fairness of purchase price allocation where estate assets and assets of non-
debtor affiliate were sold to same purchaser in single transaction).
#4827-0637-1846 44
REDACTED
Resnick & Henry J. Sommer eds., 16th ed.) (“[O]ften prepetition management bears some of the
responsibility for the debtor’s filing, and creditors and equity security holders are entitled to
know that history will not necessarily repeat itself.”).
The Debtor has failed to disclose any information concerning compensation and
incentive packages for the insiders – including any proposed compensation to be paid to either
Nolan Ryan or Hicks. Without this information, parties are unable to truly evaluate the
motivations of the Debtor’s management in connection with the Second Amended Plan and the
May APA.
VI. SECOND AMENDED PLAN FAILS TO SATISFY SECTION 1129(A)(11)
“The bankruptcy court has an affirmative obligation to scrutinize a reorganization
plan to determine whether it is feasible.” In re M&S Assocs., Ltd.,138 B.R. 845, 848 (Bankr.
W.D. Tex. 1992). “The feasibility test contemplates the probability of actual performance of the
provisions of the plan, and whether the things to be done under the plan can be done as a
practical matter under the facts.” Id. at 849 (emphasis added) (citing In re Clarkson, 767 F.2d
417, 420 (8th Cir. 1985)). “In order to confirm a plan, the court must make a specific finding
that the plan, as proposed, is feasible.” Id.
In In re Premier Network Servs., Inc., Case No. 04-33402-HDH-11, 2005 WL
6443642 (Bankr. N.D. Tex. July 1, 2005), one of the issues concerning plan feasibility was the
ability of the reorganized debtor to assume certain key contracts in order to have sufficient cash
to pay certain claims pursuant to the plan’s provisions. An opponent to the proposed plan argued
that the contracts in question had expired and, therefore, were incapable of being assumed. See
id. at *6. The court held that, where it was uncertain that the reorganized debtor could assume
these contracts necessary to implementation of the plan, the plan failed to satisfy the feasibility
requirements of section 1129(a)(11) and was unconfirmable. Id.
#4827-0637-1846 45
REDACTED
As described in detail in section IV.B. above, the Debtor is not capable of
conveying clear title to the Ballpark Lease or the Centerfield Office Lease as required by the
May APA, which renders the Second Amended Plan unfeasible.
Furthermore, among the Midnight Transfers was the incurrence by the Debtor of
indemnification obligations to numerous insiders that have not been and cannot be quantified to
date. Such obligations would remain unaffected by the confirmation of the Second Amended
Plan pursuant to section 11.7 thereof. However, based upon the conduct of certain of these
individuals, particularly in conjunction with the Midnight Transfers, the indemnification
obligations owing to them are likely to be substantial. Likewise, the Debtor’s knowing and
willful violations of numerous contractual obligations to the Lender Parties give rise to
significant causes of action. Because none of the foregoing obligations have been determined, or
even estimated, it is impossible to evaluate if the Debtor will have sufficient assets to meet its
obligations under the Second Amended Plan, and “the courts will have no objective criteria by
which to make confirmation judgments.” Walker, 165 B.R. at 1004.
With no means of quantifying these claims and otherwise demonstrating its ability
to satisfy them, the Debtor cannot meet its burden of proving feasibility. In In re Save Our
Springs (S.O.S.) Alliance, Inc., the Court held that when the debtor offered “no evidence” to
indicate its ability to satisfy certain claims, the debtor failed to meet the feasibility requirements
under the Bankruptcy Code. 388 B.R. 202, 240 (Bankr. W.D. Tex. 2008) (emphasis in original);
see also In re Gen. Electrodynamics Corp., 368 B.R. 543, 551 (Bankr. N.D. Tex. 2007) (court
held plan to be unfeasible and noted that while debtor need not show certainty of feasibility, lack
of such requirement “does not equate . . . to giving the Debtor the benefit of every doubt nor does
it shift to [plan opponents] the burden to show that the Plan is not feasible”) (emphasis in
#4827-0637-1846 46
REDACTED
original); In re Chadda, 2007 Bankr. LEXIS 4213, at *19 (Bankr. E.D. Pa. Nov. 9, 2007)
(allowing confirmation to be based on a debtor’s “hope against hope” without corroboration
“would go against a bankruptcy judge’s duties of ensuring the Plan complies with the provisions
of the Bankruptcy Code.”) (citing In re Repurchase Corp., 332 B.R. 336, 343 (Bankr. N.D. Ill.
2005)).
VII. SECOND AMENDED PLAN FAILS TO SATISFY CRAMDOWN

REQUIREMENTS OF SECTION 1129(B)
Section 1129(b) of the Bankruptcy Code requires that, for a plan to be
confirmable despite its failure to comply with section 1129(a)(8), such plan must “not
discriminate unfairly” and be “fair and equitable, with respect to each class of claims or interests
that is impaired under, and has not accepted, the plan.” 11 U.S.C. § 1129(b)(1).
Section 1129(b)(2) further provides that, with respect to a secured claim (such as
Claims in Classes 2 and 3), to be “fair and “equitable,” the plan must provide that (a) the holder
of such claim either retains its liens (whether such holder’s collateral is retained by the debtor or
is transferred to a third party) and receives cash payments totaling the allowed amount of such
claim, (b) a sale of the holder’s collateral is held subject to section 363(k) of the Bankruptcy
Code with the holder’s lien attaching to the proceeds of such sale, and (c) such holder realizes
the “indubitable equivalent” of its claims.
The Second Amended Plan fails to provide any of the above treatments to the
Claims in Classes 2 and 3. First, section 6.3 the Second Amended Plan clearly provides for the
termination and release of the Lenders’ liens despite the fact that the Debtor still owes
Obligations to the Lenders under the Credit Agreements. Second, in addition to releasing the
Lenders’ liens, the Debtor has not accorded the Lenders their section 363(k) rights with respect
to the sale of the Texas Rangers. And finally, as demonstrated in Sections I.A and I.B above, the
#4827-0637-1846 47
REDACTED
Lenders most definitely are not receiving the “indubitable equivalent” of their prepetition claims,
as the Second Amended Plan eviscerates numerous of the Lenders’ legal, contractual and
equitable rights. Accordingly, the Second Amended Plan is not “fair and equitable” with respect
to Claims in Classes 2 and 3.
With respect to the Equity Interests in Class 12, it is well established that
“technical compliance with all the requirements in § 1129(b)(2) does not assure that the plan is
‘fair and equitable.’” Fed. Sav. & Loan Inc. Corp. v. D & F Constr. (In re D & F Constr.), 865
F.2d 673, 675 (5th Cir. 1989). Courts have recognized that pursuant to § 1129(b)(2)’s plain-
meaning, the listed requirements are nonexclusive. See id. (“Section 1129(b)(2) merely states
that ‘the condition that a plan be fair and equitable with respect to a class includes the following
requirements . . . .’ Section 102(3) of the bankruptcy code states that the word ‘includes’ is not
limiting.”). The legislative history firmly supports interpreting the “fair and equitable”
requirement broadly. See 124 Cong. Rec. 32,407 (1978) (“Although many of the factors
interpreting ‘fair and equitable’ are specified in paragraph (2), others, which were explicated in
the description of section 1129(b) in the House report, were omitted from the House amendment
to avoid statutory complexity and because they would undoubtedly be found by a court to be
fundamental to ‘fair and equitable’ treatment of a dissenting class.”). In the Fifth Circuit, to
determine whether a plan satisfies section 1129(b)’s “fair and equitable” mandate, courts must
consider the plan’s effect on stakeholder’s state law rights and the particular facts and
circumstances under which those rights are abridged. See In re D & F Const., 865 F.2d at 675
(“A court must consider the entire plan in the context of the rights of the creditors under state
law and the particular facts and circumstances when determining whether a plan is ‘fair and
equitable.’”) (emphasis added); see also In re Kennedy, 158 B.R. 589, 600 (Bankr. D.N.J. 1993)
#4827-0637-1846 48
REDACTED
(“As we have reflected, the ‘implicit’ fair and equitable requirement must be applied in the
context of the rights of the creditor under state law.”).
Under this equitable approach, it is clear that the Second Amended Plan is not
“fair and equitable” to the Equity Interests in Class 12. As described above, the Second
Amended Plan, through its illegal and impermissible releases and exculpation, through its
affirmance of the Midnight Transfers, and – most important – through its failure to assure a fair
sale process for the Debtor’s assets, cannot possibly be fair and equitable to the Debtor’s equity
holders. As such, the Second Amended Plan cannot be confirmed under section 1129(b).
CONCLUSION
For all of the foregoing reasons, the Lender Parties request that the Court deny
confirmation of the Second Amended Plan.
#4827-0637-1846 49
REDACTED
Dated: July 28, 2010
Respectfully submitted,
Dennis F. Dunne (admitted pro hac vice)

1 Chase Manhattan Plaza
New York, NY 10005-1413
Tel.: 212.530.5000
Fax: 212.530.5219
ddunne@milbank.com
-and-
Andrew M. Leblanc (admitted pro hac vice)

1850 K Street, N.W., Suite 1100
Washington, DC 20006
Tel.: 202.835.7500
Fax: 202.263.7574
aleblanc@milbank.com
-and-
By: /s/ Daniel C. Stewart_______

Daniel C. Stewart, SBT #19206500
Paul E. Heath, SBT #09355050
Richard H. London, SBT #24032678
VINSON & ELKINS LLP
2001 Ross Avenue, Suite 3700
Dallas, TX 75201
Tel: 214.220.7700
Fax: 214.220.7716
dstewart@velaw.com
pheath@velaw.com
rlondon@velaw.com
ATTORNEYS FOR THE AD HOC

GROUP OF FIRST LIEN LENDERS
ATTORNEYS FOR THE AD HOC GROUP OF
FIRST LIEN LENDERS
#4827-0637-1846 50
REDACTED
By: /s/ Mitchell A. Seider

Mitchell A. Seider, SBT #18000550
LATHAM & WATKINS LLP
885 Third Avenue
New York, NY 10022
-and-
Michael R. “Buzz” Rochelle, SBT #17126700

Scott M. DeWolf, SBT #24009990
Rochelle McCullough LLP
325 North Saint Paul St., Suite 4500
Dallas, TX 75201
ATTORNEYS FOR JP MORGAN CHASE

BANK, N.A. AS FIRST LIEN AGENT
Jennifer C. DeMarco (admitted pro hac vice)

David A. Sullivan (admitted pro hac vice)
CLIFFORD CHANCE US LLP
31 West 52nd Street
New York, New York 10019-6131
Tel: 212.878.8000
Fax: 212.878.8375
jennifer.demarco@cliffordchance.com
david.sullivan@cliffordchance.com
-and-
By: /s/ Holland N. O’Neil

Holland N. O’Neil, SBT #14864700
GARDERE WYNNE SEWELL LLP
1601 Elm Street, Suite 3000
Dallas, Texas 75201
Tel: 214.999.4961
Fax: 214.999.3961
honeil@gardere.com
ATTORNEYS FOR GSP FINANCE LLC, AS

SECOND LIEN AGENT
#4827-0637-1846 51
REDACTED
CERTIFICATE OF SERVICE
I hereby certify that on July 28, 2010, true and correct copies of this Motion to File Under
Seal were served on the parties receiving electronic notice via the Electronic Court Filing
system. Also on July 28, 2010 I caused this Motion to File Under Seal to be served via first class
United States mail on the parties identified on the Master Service List, filed on July 28, 2010 as
Docket Number 443.
/s/ Daniel C. Stewart

Daniel C. Stewart
#4827-0637-1846 52

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Case 10-43400-dml11 Doc 451 Filed 07/28/10 Entered 07/28/10 16:12:39 Desc

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ATTORNEYS FOR GSP FINANCE LLC, AS

IN THE UNITED STATES BANKRUPTCY COURT

JOINT OBJECTION OF AD HOC GROUP OF FIRST LIEN LENDERS, JP MORGAN

PRELIMINARY STATEMENT ................................................................................................. 1

UPDATED STATEMENT OF RELEVANT FACTS ................................................................. 5

I. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTIONS

A. Lenders’ Claims Are Impaired Within Definition of Impairment in

B. Impairment of Lenders’ Claims Goes Further .................................................... 11

C. Second Amended Plan Fails to Satisfy Section 1129(a)(10) of the

D. Second Amended Plan Fails to Satisfy Section 1129(a)(7) of the

II. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

1. Exculpation Provision Is Illegal Under Existing Fifth Circuit Law.......... 19

2. Indemnification Provision Is Impermissible............................................ 21

C. Second Amended Plan Violates Section 1141(d)(3) of the Bankruptcy

D. Second Amended Plan Violates Section 1123(a)(5) of the Bankruptcy

1. Second Amended Plan Fails to Provide Adequate Means for

2. Second Amended Plan Fails to Provide Proper Means of

3. Second Amended Plan, in Conjunction with Land Sale Agreement,

III. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

A. Debtor Lacked Authority to File Second Amended Plan in Violation of

B. Second Amended Plan Fails to Comply with Section 1125 of the

C. Debtor’s Conduct Violates Due Process............................................................. 33

IV. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

A. Second Amended Plan Is a Bad Faith Attempt to Vitiate Lenders’ Rights

B. Second Amended Plan Is a Bad Faith Attempt to Obtain Approval of

C. Second Amended Plan Was Proposed in Bad Faith Because It Sanctions

1. Debtor’s Management Violated Its Duty of Loyalty ............................... 39

2. Debtor Violated Its Duty to Maximize Value.......................................... 42

V. SECOND AMENDED PLAN FAILS TO COMPLY WITH SECTION

VI. SECOND AMENDED PLAN FAILS TO SATISFY SECTION 1129(A)(11) ............... 45

VII. SECOND AMENDED PLAN FAILS TO SATISFY CRAMDOWN

Avery Point CLO, Ltd. v. Texas Rangers Baseball Partners,

Bennett v. Gemmill (In re Combined Metals Reduction Co.),

Cajun Electric, 119 F.3d at 356 ................................................................................................. 28

Crestar Bank v. Walker (In re Walker),

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Gearhart Indus., Inc. v. Smith Int’l, Inc.,

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In re Polytherm Indus., Inc.,

In re Premier Network Servs., Inc.,

In re Scioto Valley Mortgage Co.,

In re Suncruz Casinos, LLC,

In re TCI 2 Holdings, LLC,