Corgan Versus Dixie/Anthem: Real Life Legal Soap Opera

After months of speculation as to what was going to happen with the company, its ownership and its finances, TNA President Billy Corgan filed a lawsuit against TNA Impact Wrestling, its parent company Impact Ventures LLC, TNA Chairman Dixie Carter, TNA Chief Financial Officer Dean Broadhead and Carter's husband Serg Salias on 10/12 in the Chancery Court of Nashville, TNA.  

   Court records reveal a bit more information about movements made in the lawsuit TNA President Billy Corgan filed against Impact Wrestling, it's parent company Impact Ventures, Dixie Carter, her husband Seg Salinas, and TNA Chief Financial Officer Dean Broadhead yesterday.

   Based on the documents, a temporary restraining order was approved and Corgan filed a bond to support it today. A hearing has been set for a temporary injunction on Thursday 10/20 at 11:30 AM.

   Court documents reveal that Corgan has also requested a six person jury to decide the case.

   As noted, PWInsider.com is working on additional details, but court documents note that filings for the lawsuit have been sealed "until further notice." Requests for comment from Corgan's attorney and TNA PR have not yet been returned.


Jason Powell from prowrestling.net is saying from those he spoken with, suspects that Corgan is trying to prevent TNA from making some type of business move.

Edit
Not the only recent lawsuit for Dixie & crew
from pwinsider,
TNA's former production company, Audience of One Productions, LLC in Virginia filed a lawsuit on 9/27 in the U.S. District Court, Eastern District of Virginia against TNA parent company Impact Ventures LLC, TNA minority owner Aroluxe LLC, TNA Chief Financial Officer Dean Broadhead and Ronald Dean Harris (aka Ron Harris of the Bruise Brothers).

This lawsuit is seeking seeks $223,000 plus interest and post-judgment costs for breach of contract, fraudulent inducement on the behalf of Harris and Broadhead, torturous interference on behalf of Aroluxe and for the defendants violating Virginia code.


Edit
Meltzer add a few new details in the daily update
Billy Corgan has filed suit against Impact Ventures (TNA), Dixie Carter, Serg Salinas (Carter's husband) and COO Dean Broadhead in court today.  The documents are sealed but the gist is that things between Corgan and Carter fell apart over the past week or so, where Corgan was expecting to buy the company and for whatever reason, that was not going to happen.  Corgan then wanted them to pay him back the money he had put into the company in funding the recent tapings and obviously they couldn't do it.  Corgan was asking for an injunction and will have a hearing on it this coming Thursday at 11:30 a.m.  Corgan is requesting a jury trial.  There are also issues with music rights for the show that airs tonight to the point at one point there was a question if Pop would air the show but the show is airing.  The lawsuit being filed was not a surprise but everyone involved has gone silent since the suit was filed.  There are also claims that in negotiations that key financial information was withheld.

is @billy gonna be the man that finally brings tna down?!

The walls have really been caving in for Dixie in the last few months....
Taken mostly from Meltz's daily update

The State of Tennessee had issued a tax lien against TNA Entertainment, LLC on 9/8. The company owes back taxes in an amount unspecified and got so far behind in paying it that the state has the right to seize company property if the debt isn't repaid.  While the company is no longer TNA Entertainment, LLC, now called Impact Ventures LLC, Tennessee law allows the government to go after successor companies. It's a financial disaster, between this, getting evicted from their offices due to being unable to pay rent several months ago, and Corgan's attempt to buy the company falling apart.

The total debt owed by TNA to Aroluxe, Anthem and MCC Acquisitions is listed at $3.4 million. TNA has already sold some of its tape library to Anthem.

MCC Acquisitions shares the same physical address as Anthem Sports and Entertainment, which is the parent company of The Fight Network, They are the ones that likely funded BFG and the latest round of tv tapings.

Now to Johnson from Pwinsider
The music rights issues regarding themes that were pulled from Impact Wrestling last night are said to be that songs that were written for Dale Oliver and according to two sources, a pay issue for that material is at the center of whether TNA had the proper rights to the songs or not. A story making the rounds is that TNA President Billy Corgan informed Pop about the issue (I cannot 100% confirm this to be the case, but have heard it from multiple sources) and TNA production had to spend a few extra hours on last night's episode to make sure it was fit to see air. There were some in the production circle grumbling about Corgan because of the extra work but to be fair, if there wasn't a question about the rights to begin with, no additional editing would have been necessary. If the music returns down the line, that means TNA and Oliver were able to come to terms. Serg Salinas, Dixie Carter's husband, would be who oversees TNA's musical rights.

In regard to rumors we have been asked about regarding wrestlers saying they are going to file breach of contract if their pay is late, it's possible that could happen as it was talked about by some at TV last week, but whether anyone actually does remains to be seen. TNA usually pays talents two weeks after they appear on television.

news update from the last few days
The Corgan hearing have been move to Oct. 26.

The Impact Zone been reserved for Jan. 4-10.

If TNA can make it to start of the year, they will get millions from international TV deals that could help with the bills...

American Express filed suit in the Supreme Court in the state of New York on July 20th claiming nonpayment of $269,049.50 in travel related expenses. The claim is the company used their American Express Corporate account to charge various items and American Express was not paid.


Edit
“Anthem Sports & Entertainment Corp. (“Anthem”), the parent company of Fight Network, today confirmed that it recently made a working capital loan to fund the operations of TNA Impact Wrestling. Fight Network is a licensee of TNA programming for broadcast in the U.S., Canad and other international markets, and is also the exclusive licensee of TNA for streaming Internet-delivered TV.

Fight Network has also offered to provide TNA Impact Wrestling with funding to repay the loans made by Mr. Billy Corgan and is positioned to provide additional transactional assistance to the company.

“‘TNA is a strong property for Fight Network and as a licensee and global distribution partner we have a keen interest in seeing the company not only survive but continue to grow and thrive, alongside our own growth,’ said Leonard Aspter, CEO of Anthem. `We are hopeful that the company can soon get back to doing what it does best, which is to produce great wrestling content.’”

I cant wait until next summer when Fight Network sues TNA trying to get their money back and another sucker bails out TNA again.

Why didn't ECW or WCW have this many people jumping to save their asses

from pwinsider
A number of documents related to the lawsuit Billy Corgan filed on 10/12 against TNA, it's parent company Impact Ventures LLC, TNA Chairman Dixie Carter, her husband Serg Salinas and TNA Chief Financial Officer Dean Broadhead were unsealed by the Chancery Court for Davidson County, TN.

While the lawsuit itself will remain sealed until next week, insight can be gained from Corgan's motion for expedited discovery.  In the United States court system, discovery enables the parties to know before the trial begins what evidence may be presented so they can properly prepare for court.

The expedited discovery request notes that Corgan, Dixie Carter and Impact Ventures LLC entered into a Pledge and Security Agreement" on 8/11/16 and also makes reference to an "Operating Agreement for Impact Ventures" that was executed on 8/7/15.  The filing does not make reference to whom may have signed that Operating Agreement).

In the request for expedited discovery, Corgan requested that TNA Entertainment LLC, it's parent company Impact Ventures LLC, TNA Chairman Dixie Carter:

*Admit that Impact Ventures is insolvent "as that term is used in Section 7 (e) (i) of the Pledge Agreement.

*Admit that Corgan notified you of the occurence of an Event of Default under Section 7 of the Pledge Agreement on 9/29/16.

*Admit that Corgan currently has the right under the Pledge Agreement to exercise the voting rights associated with your equity interest in Impact Ventures LLC.

*Admit that Corgan has the right under the Pledge Agreement and the Operating Agreement to remove the managers of Impact Ventures and replace them with designees of Corgan's choosing.

If the defendants do not admit the above, they are then being asked to hand over:

*All documents related to Impact Ventures being insolvent or unable to pay all of its debts in full as it came due from January 1, 2016 to the present.

*All documents sent to or received from World Wrestling Entertainment or any of its respresentatives from January 1, 2016 to present.

*All documents sent to or received from "any third party" regarding that third party's potential acquisition of Impact Ventures LLC, TNA Entertainment LLC or any of the assets owned by either entity.

All of this helps to add context into why Corgan filed the lawsuit on 10/12, but we won't get the full picture until the lawsuit is unsealed on 10/25.

edit
Some additional notes from unsealed documents that were released today in the Billy Corgan lawsuit against TNA, it's parent company Impact Ventures LLC, TNA Chairman Dixie Carter-Salinas, her husband Serg Salinas and TNA Chief Financial Officer Dean Broadhead.

On 10/19 Corgan filed a motion to compel Dixie Carter-Salinas and Impact Ventures, LLC to "provide full and fair responses" to the discovery requests we wrote about earlier today on PWInsider.com after being unsatisfied with responses from the two defendants.

In the motion to compel, it was noted that the Court had previously denied a request from Corgan's attorneys that Dixie Carter and a "corporate representative of Impact Ventures" be deposed.

The responses from Carter-Salinas and Impact Ventures, LLC were from the previously mentioned  expedited discovery request.    In that response, Carter denied that the company was "as the term is used in the Section 7 (e) (i) of the Pledge Agreement at issue in this action."  

It was noted by Carter in her response: "The term 'insolvent' is not defined in the Pledge Agreement.   Under Tennessee law, an entity is insolvent only if the sum of the debtor's debts is greater than all of the debtor's assets, at a fair valuation.  Impact Ventures' assets are of greater value than its debt."

Carter also denied that Corgan informed her "of an Event of Default under Section 7 of the Pledge Agreement on 9/29/16" and also denied that Corgan has the right, under the Pledge Agreement and the Operating Agreement to remove the managers of Impact Ventures and replace them with designees of Corgan's choosing.

Carter's response to the latter noted, "The transfer of governance rights is invalid under Tennessee law and the Operating Agreement.  There has also not been an Event of Default as that term is used in the Pledge Agreement.  Impact Ventures LLC has not been insolvent since August 11, 2016 and is not insolvent at present."

Carter and Impact Ventures LLC (with Carter signing on behalf of the LLC) each gave "identical answers that simply stated that Impact Ventures is not insolvent and that 'Impact Ventures' assets are of greater value than its debt.  Corgan's filing noted that since they were not allowed to depose Carter and since Carter and Impact Ventures did not provide "factual basis" for their assertion that the company was not insolvent and "no supporting documents or witnesses were identified."

In regard to the documentation requested of Carter (documents backing up her statements, all documents related to Impact Ventures being insolvent or unable to pay all of its debts in full as it came due from January 1, 2016 to the present, all documents sent to or received from World Wrestling Entertainment or any of its representatives from January 1, 2016 to present, and all documents sent to or received from "any third party" regarding that third party's potential acquisition of Impact Ventures LLC, TNA Entertainment LLC or any of the assets owned by either entity), Carter responded:

"Ms. Salinas objects to this request on the grounds that it seeks information that, at least in part, can be obtained from some other source that is more convenient, less burdensome, and/or less expensive, named Plaintiff.  Subject to, and waiving that objection, and consistent with the Tennessee Rules of Civil Procedure, Ms. Salinas is producing responsive documents herewith."

Some of Carter's responses claimed that documents requested were also "overly broad", "not relevant", and "not reasonably calculated to lead to the discovery of admissible evidence because it is not limited to any period of time."

Noting that they will not be able to get a deposition from Carter prior to the next hearing on 10/26, Corgan's attorneys was noted "plaintiff will be left to guess the basis" of the claims that the company is solvent until the defendants file their own brief on 10/24, just 48 hours prior to the next scheduled hearing.

It was noted that TNA and the other defendants have handed over 17,000 pages worth of documents that are currently being "reviewed and assessed" by Corgan's attorneys.

from Meltz...Yet another lawsuit filed against TNA was by Bankdirect Capital Finance, LLC which filed a lawsuit asking for $207,612.29 plus late charges, interest and attorney feels against TNA Entertainment LLC on 9/29 in Circuit Court in Cook County, Illinois. On November 30, 2015, BankDirect entertained in an agreement where it would pay TNA $400,146.00 so TNA could pay certain insurance premiums and TNA agreed to make ten monthly payments of $41,032.45 with the first payment on November 13, 2015. As of the time of the suit, TNA had paid nearly half but still was $207,612.29 behind.

in other TNA news that I will post here instead of making a new topic since it is about how bad  TNA management been for years  

Bruce Prichard on his weekly podcast did a nearly 3 hour show on his TNA years..

He shared he had some financial issues, so TNA garnished withholdings from the Federal Government from his paycheck, however the company did not use the money to pay the government. Prichard added the government then came after him when the taxes were not paid, which was around $10,000, he had to show the government proof to get them off his back.


taken from wrestlingnews.co
Roode's 2013 contract drama
Prichard said that, in 2013, Roode’s contract was supposed to roll over for another year so essentially TNA had the option to extend it for one more year. Prichard said that he signed it well ahead of time and he had the emails and copy of the signature. Prichard said that he got a call from Roode saying that his contract expires in 3 days and he had not heard anything from the TNA office. Prichard responded, “Bobby, I sent you an extension. I signed your roll over a couple of months ago.” Prichard then forwarded the email to Roode but this was the first time that he had heard about any of this. Roode’s contract stipulated that he had the option to negotiate elsewhere if TNA did not sign off on the rollover.

Prichard went to the person that was supposed to mail out the original signed contract that was supposed to be sent to Roode and he says that the person told him that she mailed it out so he asked for a copy of the bill showing that it was mailed out. Prichard said that her face (the person at the TNA office) kind of went white like she saw a ghost and said “well, I don’t know if I can get that.” Prichard was told that there was a problem with their FedEx account so they were only using UPS. Prichard knew at that point that the roll over contract was never sent out to Roode. Prichard said that “the folks that were in charge of actually doing that felt that Bobby Roode wasn’t necessarily necessary and that if his contract expired then they wouldn’t be obligated to pay him what his contract called for and they could renegotiate at a lower rate. The problem with that is that Bobby Roode was worth every penny that he was being paid [and] probably more. The other thing about it was that we had him figured into our [creative] plans. We had long-term plans with Bobby.”

Prichard said that there was a lot of finger pointing and blaming and “he said, she said.” Prichard said that he worked on trying to get Roode to stay with the company. I believe the timeline of this was in early 2013 during the weekend of TNA Lockdown in San Antonio, TX. Prichard said that TNA ended up paying a lot more money in the end (presumably to get Roode to stay) and that there’s a philosophy in TNA people in the corporate office that “if you just let something just go then it would just go away and there were no consequences and I just hated that attitude. I hated being told by somebody that builds power plants (Panda Energy) that wrestlers are just like plumbers – you can replace them with another plumber. That analogy used to drive me absolutely nuts because a plumber can’t paint a picture and tell a story.”

Checks were sent out...
Prichard remembered that there was a time that wrestler pay was late by several weeks. He said that he would turn in payroll every week and he was told that the people in accounting would tell him that checks were sent out. Prichard said that they would send him emails documenting the check numbers and dates when the checks were supposedly sent out. Prichard would hear from the wrestlers and they’d tell him that they didn’t receive their checks. Prichard said that the excuse in Dallas was “well, it must be their mailbox or their post office.” Prichard said that makes sense if it’s just a group of wrestlers in the same city not getting their checks but there were people in different cities and different states not receiving their checks. Prichard said, “It can’t be all of the post offices. It’s gotta be something else.” So, he says that pay is now 6 weeks late and it gets to the point where guys are saying that they can’t afford to go to the TV tapings because they haven’t been paid. Prichard said that guys could not afford to park their car at the airport because they weren’t getting paid. He said that he showed up at the TV tapings and by then they received their overnight checks and there were 3 guys with FedEx envelopes in their hands. Prichard opened up the FedEx envelopes and said that they contained checks with postmarks for the dates that match up with the emails that accounting sent him weeks ago so basically they were making out the checks and they were never sent. Keep in mind that this is after TNA told him that they would reissue checks but that’s not what happened. Prichard then brought the issue up to Dixie Carter and the response was “well they got paid.”

EXCLUSIVE DETAILS: WHY BILLY CORGAN IS SUING TNA, WHAT HE IS SEEKING, HOW DIXIE CARTER MAY HAVE FORFEITED HER OWNERSHIP OF THE COMPANY AND MUCH MORE
by Mike Johnson @ 4:56 PM on 10/25/2016

A redacted version of the 41 page lawsuit TNA President Billy Corgan filed against TNA, its parent company Impact Ventures, Dixie Carter, Dean Broadhead and Serg Salinas was officially released to the public today by the Chancery Court in Nashville, TN, revealing a lot of insight when it comes to why Corgan filed suit.

The lawsuit alleges that Corgan initially invested into TNA because "Impact Ventures was in severe financial distress" and that by investing, he was preventing the company from suspending operations and going into "immediate foreclosure" to Aroluxe Media, described as the company's production company. PWInsider.com first broke earlier this year that the way Dixie Carter's deal was structured with Aroluxe, they were putting out the financial cost of TNA's TV productions and TNA would pay them back installments - and if Carter failed to make the payments, she could lose control of the company. Well, that was the very scenario that, as if turns out, led to Corgan stepping in last June.

Corgan's lawsuit notes that TNA "needed an injection of funds" to pay Aroluxe so that they would move forward with the production of Impact Wrestling episodes in June - so this all took place over Slammiversary weekend, when PWInsider.com first reported Corgan had bought a minority share of the company. Aroluxe also required an additional payment due to TNA "defaulting on multiple payments" prior to this point. The financials were redacted.

The reason Salinas and Broadhead are listed as defendants alongside Dixie, TNA and Impact Ventures is that they are listed as the Managers of Impact Ventures LLC. The lawsuit also alleges that per the Operating Agreement for the company, Dixie Carter is the "sole member of the company" but it is believed Carter owns 92.5%, Aroluxe Media owns 5% and Anthem Media (MCC/Fight Network, etc.) own 2.5%, with the latter two described as "significant creditors in the company."

In July, Corgan again invested money in the company, once again to prevent Aroluxe from foreclosing on Dixie Carter and taking control of TNA. The same happened in August, except by this point an agreement between TNA and Aroluxe had contractually expired, "thereby allowing Aroluxe to foreclose on the company at any time." Due to that turn of events, Corgan's lawsuit alleges that he, Carter and Aroluxe entered into "an amended and restated loan agreement" that saw Corgan agree to make his now-third investment in the company with the company issuing him a "new second priority secured convertible priority note", replacing his previous note regarding what he was owed.

The August Agreement also saw Corgan appointed as President of TNA with Carter, the former President, shifted into the title of Chairman and Chief Strategy Officer of Impact Ventures. It was noted that Corgan "desired" to be President so he could direct and oversee the day-to-day operations of the company and improve it's financial condition. Corgan also stated that Carter, as security for the loan, "entered into a 100% equity pledge agreement" with Corgan, allowing that in the event of default, Corgan would be "entitled to exercise all voting or consensual powers pertaining to collateral."

In layman's terms, the lawsuit claims that Carter made Corgan President and agreed that Corgan would gain 100% control of TNA's parent company if she defaulted on the loan he made, in order to get him to invest this past August - because had he not, Aroluxe would have foreclosed.

The lawsuit claims that the paperwork Carter signed appointed him as the "attorney-de-facto" of TNA had an "Event of Default" occurred under the terms of their agreement - which is referred to in the lawsuit as the insolvency of TNA and/or Carter personally.

In regard to Impact Ventures LLC, the lawsuit describes the company as "insolvent" and that "its liabilities exceed the values of its assets, and that Impact Ventures is unable to pay its debts as they come do in the ordinary course of business." Included were cash flow statements, listed as created by Impact Ventures, that showed a "cumulative cash flow negative of [redacted] for the period from September to December 2016, followed by the period of September 2016 through June 2017.

Corgan claims that despite numerous requests, the company has not provided him with any updated balance sheets past 6/30/16, that they are in a negative balance when debt is compared to assets and that the company's financials have actually worsened since the last balance sheet he was provided. Corgan states that insolvency now results in him needed to be awarded Dixie Carter's 92.5% share in the company.

The lawsuit also noted that there have been "media reports" about TNA negotiating with WWE for a potential sale of the TNA video library. The lawsuit notes that Dixie Carter and Dean Broadhead had each denied that but "Mr. Salinas" (perhaps meaning Serg Salinas, or perhaps a typo referring to Dixie Carter) acknowledged the conversations to "the company's wrestlers on October 2, 2016", which would be Bound for Glory.

Based on Corgan's agreement, he claims in the lawsuit he is entitled to a full review of the company's "Officers, counsel, books, records; the full ability to investigate the company's titles to property and to the condition and nature of its assets, business and liabilities" as well as full opportunity to review the company's business plan with "key officers." Corgan is alleging that despite numerous requests, he was given no information about discussions with World Wrestling Entertainment - despite the fact he is President and a creditor to the company and the library is the company's "most significant" asset. He is claiming that is a breach of the agreement he signed in August.

Corgan is also claiming he has been kept in the dark in the company's conversations with Anthem Media (Fight Network/MMC Acquisitions, etc.) leading up to the recent loan [amount redacted] "and it's financial impact on the company" until after the transaction had already been completed - again despite the fact he is President and a creditor to the company.

In the lawsuit, it is noted, "This recent conduct is consistent with the way Mrs. Salinas [Carter] and the other members have dealt with the Plaintiff since the inception of his involvement with Impact Ventures. They have failed to keep Plaintiff apprised of matters of great significance to the company; they have routinely misled plaintiff as to the company's finances, operations and future prospects; they have failed to provide the plaintiff with information necessary to discharge his duties as President to manage the day-to-day operations of the business; and they have regularly interfered with, subverted or ignored plaintiff's authority to manage affairs in the company." Corgan alleges these failures constitute an additional default in his agreement with Carter.

Corgan states in the lawsuit that Carter was informed of an "Event of Default" on 9/29 (this would be the day before MCC Acquisitions financed the Bound for Glory PPV and subsequent TV Tapings) but the defendants did not respond affirming or denying the "Event." Corgan then informed Carter and the company on 10/12 that he was exercising his right to take over her stock in the company and place his own designated managers in charge of Impact Ventures. He received no response.

Corgan's lawsuit states, "The company is continuing to flounder and has been taken to the brink of financial collapse under Ms. Salinas and the other managers. The company's secured creditors, including Aroluxe and Anthem, can foreclose at any time."

In the lawsuit, Corgan is seeking a declaration from the court that he is indeed entitled to Carter's 92.5% of the company, her voting rights and has the ability to replace the current managers with designated managers of his choosing. He is also seeking damages, to be determined by the court, for the breach of contract, and requesting an injunction preventing the defendants from making business decisions that could further harm Corgan and the company as well as preventing them from attempting to sell the company or it's assets until the lawsuit is resolved.

A hearing regarding Corgan's request for a temporary injunction against the defendant is scheduled for tomorrow 10/26 at 1 PM Central.

WOW..

from pwinsider

A number of new documents were filed today prior to the scheduled hearing in Billy Corgan vs. TNA, etc. before the Chancery Court in Nashville, TN.

In a redacted Memorandum filed with the Nashville Chancery Court to explain why he requires a restraining order against the defendants in his lawsuit against TNA, Billy Corgan lays out his argument for why TNA is insolvent and notes that currently, Impact Ventures "balance sheet shows the company's debts are close to ten times the company's assets."  Corgan states that the company falls under the definition of insolvent for the state of Tennessee, which describes the term as similar to the definition of the term in the Uniform Commercial Code and the Bankruptcy Act, which states that "insolvent" means having generally ceased to pay debts in the ordinary course of business other than as a result of a bona fide dispute, being unable to pay debts as they become due or being insolvent within the meaning of federal bankruptcy law.

Corgan's push for the restraining order also noted that according to Rule 65 of Tennessee Rules of Civil Procedure, they court is authorized to issue temporary restraining orders "without notice to the adverse party" if "specific facts in an affidavit or a verified complain clearly show that immediate and irreparable injury, loss, or damage will result to the applicant before the adverse party can be heard in opposition..."  The filing argues that since this is a private issue between Corgan and the defendants, it is possible that left unchecked, they will cause Corgan "immediate and irreparable harm."

Also filed today was a redacted declaration from Corgan laying out why he invested in TNA and accusing the defendants of hiding how bad the company's debts were in order to get the investment from Corgan.   In describing his initial loan on 6/10/16, Corgan notes that he was given a "senior secured" promissory note, and was not aware that Aroluxe and Anthem Media Sports and Entertainment had already been granted seniority regarding the debt they were owed. In layman's terms, Corgan invested under the belief he would be first in line to be repaid, only to learn he was actually third in line. Corgan also alleges that he was told by Dixie Carter and TNA Chief Financial Officer Dean Broadhead that TNA had a debt of a certain amount, and was never told the company actually had debts of "over [redacted.] So, he is alleging he was misled about the amount of money the company actually owed before he made his first investment. Corgan said he was still never informed of the actual debt when he made his second investment in July and only learned of the actual level of debt in September 2016 when he was provided a company balance sheet (dated 6/30/16) by Broadhead.

Corgan also stated that he learned what the actual debt of the company was "in the course of this litigations through the documents that Impact Ventures produced." While the number of redacted, Corgan wrote, "I did not know that Impact Venture's debts were that high. I never would have agreed to invest additional capital in Impact Ventures had I known the company's debts were that high."

Corgan also stated that he was misled into making his "third and final loan" to the company in August 2016 based on "repeated representation" by Dixie Carter that "acquisition negotiations" were underway with third parties and that an acquisition of the company was "imminent" including a proposed investment from Aroluxe.

Corgan also noted that the company has prevented him from doing his duties as President, learned that the company has failed to pay its taxes based on an article in the Tennessean newspaper and that a lien has been filed against the company, and that a number of lawsuits had been filed against the company by Audience of One Productions, American Express, and by Bankdirect Capital Finance, LLC.

The declaration revealed for the first time that TNA planned to film TV in Orlando on 11/1-11/3 at Universal Studios but the decision was made on 10/25 to postpone those tapings "due to a lack of funds."

Corgan also alleges, "Impact Ventures also continues to not pay its talent, except now defendants are blaming me and the temporary restraining order in this case for lack of payment."

The declaration included a certification sent to his attorney by TNA's counsel on 10/30/16, including a term sheet that would have required Corgan to give the company a "full release of all claims" against them by Corgan. Corgan wrote, "I will not agree to provide Impact Ventures with a 'full release' as a condition to the repayment of my loan proceeds. I am not required under any of the loan documents to provide such a release in return for full payment. I also believe that I have claims against Impact Ventures and the other defendants that are separate and apart from the claims that I have currently asserted herien, and I am not willing to waive or release those claims."

Corgan also states that he was never "provided" with a proposed draft of an employment agreement in connection to his role as President of the company and that he has also not been provided "with access to the information I would require under the Second Amended Corgan Loan Agreement" that would allow him to make an "informed decision" as to whether to convert his loan into an "equity position" in the company. What that means, as I suspected and discussed previously in PWInsider Elite audio, is that Corgan's loan was similar what a bank would do when it loans money to a film production and the collateral if they are not repaid is that they end up with points in the film and get their money back that way, owning a piece of the pie. Corgan is saying he can convert to a piece of the pie but can't make that decision without information the company won't give him.

Corgan also states that he understands that Jason Brown (Aroluxe) "has undertaken the duties of managing the day-to-day operations of the company", while Corgan has been excluded from those duties despite his title and his signed agreement. Corgan stated that he his under the understanding that Brown has been "planning events for 2017 and negotiating contracts with talent."

By Mike Johnson on 2016-10-26 14:01:00

While Impact Ventures, Dixie Carter, etc.'s response to Billy Corgan's lawsuit remains sealed as of this writing (about an hour before their scheduled hearing in Nashville, TN), Corgan's response to their claims was filed with the Chancery Court this morning, providing some insight into TNA's defense, although admittedly, not all.

In that response, Corgan stated that "Defendants first attempt to portray Corgan's complain and application for injunctive relief as nothing more than a back-handed grab for power." Corgan responded that he has great passion for TNA Wrestling's talents and fans and that the "last thing" he wanted to do was file suit, but he had done everything he could to avoid litigation. He said that he was forced to file the suit due to the defendants' "repeated willful disregard of their contractual obligations to him" and that documents TNA, etc. produced on their own "demonstrates that defendants have been engaging in an orchestrated effort" to deprive Corgan of those contractual rights.

Corgan noted that the defendants then argued that his application for an injunction should be denied because they "have secured financing to pay Corgan the full amount to which he is entitled." Corgan responded that is false and "defendants have merely obtained a proposal for financing a portion of the amount Corgan is due, and that financing proposal is premised upon conditions that cannot be fulfilled, named obtaining a release from Corgan that is not obligated to provide and will not provide for various reasons." It appears this is in relation to Corgan noting in his Declaration filed today, which PWInsider.com wrote about earlier, that TNA wanted him to release them from all claims in order for Corgan to get his money. Corgan insinuated in his declaration that he may be taking additional legal action against Dixie Carter, etc. and did not want to exempt himself from that possibility by agreeing to any release of claims against the defendants in exchange for his money.

Corgan's response also notes that the defendants are arguing that the provision in his signed agreement with Dixie Carter that would allow him to exercise her voting rights in Impact Ventures is invalid under the Tennessee Revised Limited Liability Company Act and Impact Ventures' Operating Agreement. Corgan responded that the defendants are mistaken and explained that a provision in the agreement allowing him to exercise Carter's rights is the same as a voting proxy, which is "expressly permitted by the Act" and not prohibited by the company's Operating Agreement.

It is also noted in the response that the defendants are arguing that Impact Ventures is "not insolvent." Corgan, noting that the Chancery Court allowed limited discovery, stated that during that discovery period, documents that the defendant produced actually "demonstrate that Impact Ventures is insolvent under any of the applicable tests." He claimed that the defendants have attempted to provide "circumstantially" that Impact Ventures is solvent based on "a jaundiced view of certain investment and asset purchase proposals." Corgan continued, "Even so, Impact Ventures' true debts are higher than any value of its assets even suggested by that circumstantial evidence. Thus, it is clear that Impact Ventures is insolvent and that Corgan is entitled to exercise Mrs. Salinas' voting rights in the company."

The response also noted that the defendants have attempted to brand Corgan as a "predatory lender" with "strong arm loans." Corgan responded that he took the risk of investing "significant sums" into Impact to save it from being "shuttered" and negotiated "at arms-length" to contract terms which all parties knowingly and voluntarily agreed to - and is now seeking to prevent the defendants from reneging on their promises to him. Corgan noted that "adding insult to injury, the documents the Court ordered defendants to produce demonstrate that defendants misled Corgan every step of the way."

The filings include a quote from Dean Broadhead in one of those produced documents noting, "Without the Corgan funding, all would have been lost."

In regard to his appointment at Impact Ventures President, Corgan stated that had he not been given that appointment, he never would have agreed to continue loaning the company money, because he believes Carter and the other managers of the company "had driven the company into the ground." It is noted that documents produced by the defendants show that they never had "any real intention of recognizing Corgan as the company's President in charge of the operations", noting that an email between the defendants and Anthem Media noted, "Mr. Corgan may have an agreement providing him with a title, but in the absence of a document delegating authority to him, it is a vacuous appointment." Corgan noted that he is still waiting to be provided with "even an initial draft" of the employee agreement for him as President for his own consideration.

The response noted that Corgan and the defendants agreed that Corgan had the right to convert his investment in the company into a 36% ownership stake or that he would receive an "additional premium of [redacted] should the company engage in a "Corporate Transaction" (meaning a sale). Corgan claims that all of those rights were based on the defendants "repeated representations" to him in order to get him to invest initially and then continue to invest in the company. Corgan again reiterated that the company had breached its agreement with him by keeping him in the dark about negotiations with third parties.

Corgan makes this clear when he cites that on 9/26/16, he was told that allegations that the company was speaking with WWE was "absolutely not true" when just the day before, on 9/25/16, Broadhead himself had sent a "representative of WWE certain due diligence materials that WWE had requested."

In another citing, it is noted that WWE raised issues about Corgan's "note" over the course of WWE negotiations, which led to Dixie Carter responding, "I intend to pay the loan back in full plus interest prior to selling the company."

Corgan again argued that he should be able to take control of Carter's interest in Impact Ventures because the company is insolvent, noting it took on additional debt to produce the Bound for Glory PPV and TV tapings and that "it had become apparent to Corgan that defendants were never going to allow him to participate in the management of the company, as promised, and were attempting to cut deals to sell the company or its assets behind his back." Corgan noted he then elected to exercise his unconditional right to Carter's interest in the company and replace its managers in order to protect not only his own rights as a significant creditor and potential member of the company, but also in the interests of Impact ventures and its employees and independent contractors.

In producing proof that the company is indeed insolvent, Corgan notes that the company's financial condition significantly deteriorated after 8/11/16, including:

*The aforementioned American Express lawsuit, Audience of One and Bankcredit Capital Finance lawsuits.

*The company being in such "dire straits that it was unable to pay officers' salaries" as of 8/31/16.  It specifically noted that Dixie Carter and Serg Salinas are owed in back pay.

*As of 9/1/16, "checks issued to talent bounced", with Dean Broadhead stating in one document, "We owe talent money. We owe employees money. we (sic) many vendors money."

*As of 9/8/16, Impact Ventures was unable to pay its state taxes, leading to the tax lien.

*As of 9/8, the company's operating account was overdrawn by [redacted] yet the company had trade accounts payable totaling at least [redacted.]

*As of 10/3, Impact Ventures was unable to pay vendor "Seismic Sound" a redacted amount, leading them to threaten collection actions.

*The aforementioned tapings that were postponed on 11/1-11/3.

*The defendants not paying talent and blaming Corgan and the temporary restraining order for not paying them.

*Although not dated, it is also noted that the company owes money to a "SRX Consultancy."

Corgan followed up that "Although expressly stated, defendants also appear to argue that they can continue to dig the company deeper and deeper into a financial hole by obtaining additional debt to fund their operations." Corgan noted that even after they secured a loan from MCC Acquisitions in September, it was not able to finance it's production of tapings in October and also avoid the plethora of collection lawsuits and the tax lien referenced above. It was noted, "Simply put, it defies logic to assert that Impact Ventures can somehow make itself solvent by becoming more and more insolvent."

In arguing that the company's assets do not exceed a redacted amount that proves the company is insolvent, Corgan argues that the defendants have not provided the Court with "any direct evidence of the value" of their assets. "Instead, defendants only offer weak circumstantial evidence in the form or investment and asset purchase proposals from Corgan and WWE." Corgan argues that evidence "does not even come remotely close" to proving the company is solvent. Corgan argues that the items the defendants are using as their crutch in the argument are simply proposals and "none of them represent a firm offer that defendants could accept." It was noted a letter dates 6/4/16 from WWE stated that it was a "non-binding indication of interest for discussion purposes." It also noted that an unsigned draft of a non-binding purchased agreement did not explain why WWE reduced it's initial proposal down [the numbers, obviously, are redacted] .

Corgan, in noting that he wanted to acquire an equity stake in the company, notes again that he was never told the true nature of the company's debts that it is unclear if the company ever "advised" WWE what the levels of Impact Ventures' debts were in September 2016. Corgan noted, "If defendants falsely represented to WWE that the company's liabilities were only [redacted] as stated in the June 30, 2016 balance sheet, the evidentiary value of any "offer" WWE may have made would be even more dubious."

There is also a note that in their agreement with Corgan, the company would repay Corgan's loan to them by 11/1/16 and that therefore, Corgan's claims should be denied. Corgan noted that the note has not been paid "and it is doubtful that it will be paid in a timely manner because Impact Ventures, by its own admission, does not have the money to do so." Corgan noted that while the claim is that Anthem has agreed to pay Impact's note to him via an investment of funds, Corgan has not been provided with any documentary other than a "key terms" sheet that requires he agree to be a full release of claims against the company. Corgan has made it clear he will not agree to those terms.

Corgan also argues that they are representing him as simply a creditor when he is not someone just owed a debt but someone with the right to either demand payment or convert his debt into a 36% membership of the company.

Corgan noted that in an agreement from Anthem to invest money into the company, the agreement would see Anthem replace Aroluxe as the top secured creditor in the company, see Anthem repay Corgan's "loss" and Aroluxe agree to be obligated to produce each show for the October and January TV Tapings at a reduced price.

That agreement would also result in Anthem receiving 85% of the company, Aroluxe receiving 10% and Jason Brown of Aroluxe being named the CEO of Impact Ventures for a term of three years. It would appear the final 5% would remain with Dixie Carter. Corgan is claiming that all documentation "strongly supports" his claim that they have all entered into an agreement without his involvement or knowledge. Given that would constitute "a Corporate Transaction", Corgan argues that he is owed more than just his investment and that everyone involved have "colluded to delay the actual signing of their agreement until he is out of the picture so he doesn't get the "premium payment."  

So, Corgan is now alleging that the company was working to defraud him of money he would be contractually owed.

Taking from tweets of @tnnateraum , who is at the hearing. I have tried to edit some of the says/saids

Chancellor Hobbs Lyle is here and we're underway. She begins by thanking lawyers and staff for redacting filings that were unsealed Tuesday. Corgan's atty Scott Sims begins. He says Corgan saved the company on 3 occasions. But TNA didnt hold up its end of bargain.

Sims says Corgan and Carter entered pledge agreement that included insolvency cause. Proving this is crucial part of lawsuit.  TNA misled BC about company debts. He says Corgan was named pres but excluded from mgmt decisions.

This is a contract dispute Sims says. "Theres no dispute this is a valid pledge agreement."  The second question is if TNA really is insolvent. Sims says there is no doubt about that.  "We basically have a pledge with a voting proxy," Sims says. TNA argues that a transfer of ownership to Corgan was never approved.  

Chancellor asking Sims about Corgans desire to remove managers. "Does that fit circumstance of a proxy?" She's pushing back at key argument.  Dixie is watching without showing any emotion. Shes following along while Sims argues TNA is insolvent. Lawyers have agreed not to disclose redacted financial details. Sims says TNA fails the "balance sheet test" and the "cash flow test."  

Sims says TNA "has required new infusions of cash to produce new" Impact shows.  It is clear TNA is not paying its bills. They say financial condition was same when Corgan signed pledge agreement.  But Sims says Corgan didnt know financial strife facing TNA when he gave cash.  

TNA is not paying talent.  Company blames lawsuit. Sims says thats not true. TNA is insolvent beyond doubt on cash flow test.  TNA has 52 pct more liabilities now than June balance sheet and he argues total debts are actually higher.  Chancellor asks about short term need for cash vs long term value of TNA.  

Sims says 1. Cash flow deficit has been in existence since at least June. 2. Pro forma shows 1 year of large cash flow deficits facing TNA.  mgmt has put TNA in ICU at least 5 times this year. Hes referencing frantic cash calls they make after each taping.  it is noteworthy they havent produced schedule of liabilities. He implies TNA is hiding something.  Sims says unpaid tax bill is unknown.  

Sims says theres been no efffort to assign value to assets ie video library.  Sims referencing WWE negotiations now. He says WWE lowered its first offer. And current offer counts noncompete clauses. Wwe offer is lower than Corgans estimate of TNA liabilities.  Just because WWE and others have offered investment in TNA does not prove company is not insolvent.  

Is TNA a solid company worth millions or insolvent company contractually obligated to transfer power to Corgan. Sims just seemed to slip and say $1.8M is owed to Corgan on one note.  $1.8M was from Anthem. Thats the company that owns TNA licensing rights to video library.  Anthem has issued press release saying it is willing to pay off Corgan and Aroluxe's Jason Brown will become new ceo.  

Sims just said Carter made offer for Corgan to buy her out. Everyone involved is trying to make a deal. Sims says Dixie emailed WWE to say she wont sell to them until Billy is out. Winding down Corgans side. TNA lawyers up next.


TNA attorney Travis Parham is up now. He calls lawsuit a scheme by Corgan to take over the company and force out Carter.  He says lawsuit has created a creditor crisis and hurt TNA's financial standing.  TNA has good will, notoriety, merchandising, licensing and is an international brand.  Parham says TNA is a valuable, well known commodity. Carter owns 92.5 pct, Anthem owns 2 pct and Aroluxe owns 5 pct.

Parham said TNA anticipated short term cash flow problems and knew its new business model would be a challenge. cash flow company came to roost this summer and Corgan gave a loan that could be transferred to equity. Corgan lent more money in July and had right to convert loan to 12.5 pct interest. Parham is arguing TNA is not insolvent.

A third loan from Corgan came in August, Parham said. But he says Corgan's loans were oportunistic to benefit himself.  Corgan wanted 22.5 pct in company after third loan and insisted on pledge agreement.  Corgan wanted all principal, 6 pct interest and 50 pct equity kicker as condition of 3-month loan in August.

Parham called that deal a 200 pct rate of return that would make a loan shark blush.  Parham called Corgan's loan a "heads I win, tails you lose" deal. He says Corgan has resisted efforts to repay his loan.  Corgan doesn't want to be refinanced and paid off, because he wants 92.5 pct in company, Parham said. "Whatever risk," Corgan faced, "he's been incredibly well compensated," Parham said.

Parham said Corgan offered to buy company the day his loan agreement expired. That would have included paying off Aroluxe.  That deal would have given him 52 percent of TNA. "he's now saying company is worth nothing,"  Parham said Corgan tried to buy TNA last month, then went litigation path when deal fell through.  Corgan did nothing to set up necessary financing for Sept. production.  

Parham vigorously denies financial details were hidden from Corgan.  Parham said Corgan is attempting to cause TNA to default on his own loan.  Parham said injunctive relief should be used sparingly. He says Corgan has not suffered irreparable harm. Corgan wanted to get rid of all managers and appoint himself manager.  

Parham says Dixies manager rights cant be transferred under the law. the contract between Corgan and Carter is illegal under TN law. So Carter cant transfer her mgr rights even if TNA is insolvent.   cash flow is a small part of the story. He says people want to buy TNA bc it is valuable. Parham said tax lien is an accounting mistake. A non issue he says. Parham calls deal predatory lending at its worse. Reiterates TNA is willing to pay off Corgans loan.  

Anthem atty says company is willing to pay off Corgan loan minus transaction premium he says he is due.

Hobbs Lyle says her ruling will come on Monday.


Edit
PWInsider notes about the hearing
*Corgan was not in attendance.

*Carter, Salinas, Broadhead and several other TNA staffers were in attendance at the hearing.

*There was no testimony from witnesses, simply lawyers from each side explaining their client's standing on the argument.

*As Corgan's attorney explained his position, the Chancellor overseeing the case asked about how he was applying the law of the State in terms of their claims, There were several times the Chancellor interrupted to ask about the application.

*TNA's attorney argued that Corgan had only loaned money to the company and does not have an ownership stake. He had a note promising a repayment of the loan, plus 6% interest.

*At one point, Corgan's attorney, slipping as he spoke, stated that Corgan's loan was for $1.8 million.

*It was also noted that the fee that Corgan would receive if a "Corporate Transaction" fee took place before repayment was 50%, meaning 50% of his loan. So, if TNA had that transaction fee, Corgan would be in line, based on the number stated by his attorney, for something in the area of an additional $900,000.

*It was argued by TNA's attorney that Corgan's agreement with Dixie Carter was drawn up under California law, but under that State's law, a percentage over 10% is not legal in such cases, therefore Corgan's agreement was not enforceable.

*TNA's attorney did note that the company is not insolvent but does have negative cash flow at the moment. It was noted that in the course of business, that does happen, with Uber being used as an example of a company that is valued at a certain level but currently has negative cash flow from recent losses.

*TNA's attorney also categorized all of the recent lawsuits and chaos around the company as being Corgan's fault, stating that there were entities that had worked with TNA and were willing to work with them to take care of the debts but Corgan's actions and statements started a panic. It was stated that because he had done so while President, there may be issues that need to be pursued when it comes to Corgan disclosing information about the company publicly and whether he, as President, caused some of the company's current issues.

*In regard to Corgan's allegations that he was kept in the dark as TNA negotiated with others (including WWE, who were given the code name ACME at the hearing), TNA's attorney claimed there was a conflict of interest there as why would the company give insider information regarding bidding for the company to someone who was an active bidder.

*TNA's attorney also argued against Corgan claiming the company was insolvent, noting that a month before, he had made an offer to purchase the company based on a certain valuation but now was claiming its not worth anything. Corgan was described as an "opportunistic rock star who was a huge wrestling fan that wanted to be in the wrestling business" and that it was his actions causing the company's current financial crisis.

*An attorney for Anthem Media was also present at the hearing and stated to the cut that the company was willing to cover Impact's repayment of Corgan's note as well as the interest (6%) but not the "Corporate Transaction" fee. They also stated that they also wanted a release from Corgan exempting them from that transaction fee.

As noted previously, the decision regarding the Injunction will be handed down on Monday 10/31. From that point on, unless there is a settlement, we are heading to all the back and forth wrangling that comes with a lawsuit.

This afternoon, The Nashville Chancery Court unsealed Impact Venture, Dixie Carter, etc.'s response to Billy Corgan's lawsuit.  This was unsealed prior to this afternoon's hearing.

In the lawsuit, TNA stated that Corgan "owns no interest in Impact" but had loaned money to the company and "used that loan to strong-arm the company into giving him the title of President."

TNA claimed at that time Corgan filed his lawsuit, he had 20 days remaining as a lender to the company. With "time running out on his loan and with replacement financing imminent", they alleged Corgan declared a "non-monetary default" under the pledge agreement he signed with Dixie Carter. They stated he "then purported to use" her voting power to terminate the other defendants from the company in order for Corgan to install himself as the company's sole owner.

They argue that Corgan's claim to voting and control is solely through the pledge agreement, but that would terminate upon re-payment of his loan. TNA states in the lawsuit that Corgan is well aware that Impact has a new funding source ready (obviously Anthem/Fight Network) "willing and able" to pay Corgan the principal and interest due from his loan.

TNA stated that Corgan us trying to use "this illusory default and managerial control" along with the power of the court to prevent TNA from being able to repay his loan while also preventing Carter from selling her controlling interest to anyone but him. They warn that should Corgan succeed, he will next try to obtain Carter's 92.5% interest and get "true control" of the company well below the level he valued the company at as well as the company's true value

The response claimed that Corgan suffered no irreparable harm and that the situation was simply about a debt, nothing more and the defendants are happy and ready to repay him.

The filing also argues that the company is not insolvent and that there has been no "Event of Default" under the Pledge Agreement between Carter and Corgan. They argued that while Corgan has suffered no real harm, Carter will suffer "tremendous harm" if the court grants the injunction in Corgan's favor.

TNA's response also noted, "the public interest weighs strongly in favor of denying Plaintiff's request because his predatory conduct as a lender is improper and highly contrary to the public interest."

In explaining the course of events that led to Corgan investing in the company, Corgan came on board to work on the creative end. In early 2016, the company "identified a need for funding to address short-term cash flow challenges." Carter anticipated the sale of TNA to a third-party strategic buyer and approached Corgan about a "very short term loan." Corgan told Carter he was not interested in being a bank, but wanted to be an equity owner.

Carter told Corgan that she had not decided upon whether to sell yet, but that if she had, Corgan would receive a "nice amount of interest for his loan, and if she did not, he could convert the loan to equity." The loan would satisfy the company's cash needs through July 2016, according to the filing.

Corgan agreed to loan TNA a redacted amount of money with the loan broken into two separate advances. Corgan, according to TNA's filing, stated that certain conditions to the second part of the advance had not been met and did not make the advance as "originally envisioned."

TNA's course of events continued by noting that in July 2015, Carter, Corgan and Aroluxe discussed and negotiated as "broad potential transaction" that would see a group of investors brought in by Aroluxe invest in TNA with Corgan becoming a minority owner. The three parties signed an agreement at that time, noting the discussions and intent for this to happen.

TNA, noting that Corgan did not advance them the second half of the original loan, found themselves in a position where they still needed funding in July due to continuing cash flow challenges. Around 7/18/16, Corgan loaned the company money for a second time, but "with different terms and conditions originally outlines and agreed to" in prior discussions. Corgan "insisted" on a senior executive position and title in charge of the creative aspects of TNA. Corgan and Carter agreed upon the "Chief Creative Officer" title.

The deal that was to be structured would feature Aroluxe's consortium of investors as 52.5% owner, Carter as 27.5% owner, Corgan as 12.5% owner, Aroluxe owning 5% and Anthem owning 2.5%. The transaction for this had not closed by 8/11/16 but remained under discussion. Impact, at the time, believed that Aroluxe would be providing "temporary bridge funding" until the deal closed and all parties involved knew that the company was going to be needing funding for August.

The bridge loan from Aroluxe "was needed, but did not happen" leading to Corgan lending Impact another round of money. At this point, Corgan insisted to a "series of very pro-Plaintiffs conditions that he is now using in his efforts to take control of the company."  

At that point, Corgan's three loans were rolled into "a secured senior convertible promissory note" and as condition of the third loan, Corgan insisted on "taking the title of President" from Carter and "purporting to assume control over day-to-day business affairs." It was noted that Carter "put on a good face for the public" in making the announcement.

As part of a revised deal, the new ownership structure, once Aroluxe's investors put in their money and Corgan converted his debt into equity ownership of the company, the breakdown would then be: Aroluxe consortium with 52.5%, Corgan with 22.5%, Carter with 17.5%, Aroluxe and Anthem with 5% each.

It was noted that Carter's stake in the company was valued at more than twice what

As part of the third loan, Corgan required that Carter sign a "Pledge and Security Agreement" drafted by Corgan's attorney that was "overwhelmingly favorable" to Corgan. They noted that Corgan knew that if Carter did not sign, the company would face a difficult and immediate financial challenge.     The filing noted, "Nonetheless, Impact needed the short-term financing" and Carter "was comfortable that the Corgan Loan could and would be repaid even if the TNA Transaction did not close." To avoid a "financial crisis", she reluctantly signed the Pledge Agreement.

The Pledge Agreement between Carter and Corgan granted Corgan a "lien and first security interest in 100%" of Carter's interest in Impact, 92.5% of the company. TNA argues that the Agreement is intended "to secure the obligations under the Corgan Note, but only the obligations of the Corgan Note."

It was noted in the Agreement that "in the absence of an Event of Default, Pleadgor [which would be Corgan] shall be entitled to exercise all voting and/or consensual powers pertaining to the Collateral [Impact] for all purposes not inconsistent with this Agreement. Upon an Event of Default, Corgan shall be entitled to exercise all voting and/or consensual powers pertaining to the Collateral for all purposes not inconsistent with this Agreement."

In the Pledge Agreement, the "Event of Default" was listed as either side breaching the agreement or if one of the sides became insolvent. The agreement would terminate when all obligations under the Note "have been fully paid."

It was noted in the TNA filing that in the event the transaction involving the Aroluxe consortium did not close by 9/27/16, Corgan could, if he desired, convert his loan into a 36% interest in Impact. The transaction did not happen by 9/1. The TNA filing states that at Corgan's request, Carter did not accept a request from Aroluxe for an extension on the exclusivity to close their deal to purchase the majority of the company. On 9/1, Corgan began his own negotiating to become the majority owner of the company.

Corgan, according to TNA's claims, offered to convert his loan into an equity position and then "pay off" TNA's debt to Aroluxe. After doing so, he would receive a 52.5% interest in the company, effectively replacing Carter as the majority owner.

TNA's filing states that Carter "spent the bulk of September trying to facilitate a modified deal" between the parties to allow for this significant funding into the company. It was noted that a company that Carter "had prior discussions regarding a potential sale, re-approached" Carter about buying the company's assets. While the name of the company is redacted, it is pretty easy to surmise they are referring to WWE given the timeline. It was noted that since Carter was unclear as to "the degree of progress" being made between Corgan and Aroluxe, she engaged in discussions with the new [likely WWE] company. Carter also reached out Aroluxe and Corgan to see if they were willing to issue an additional loan if they did not come to terms. As we know, they didn't.

This all leads to Bound for Glory weekend. TNA noted that Carter "began to have concerns about financing this production" but trusted Corgan's representation "that he would get a deal with Aroluxe" to buy them out and take over as majority owner.

TNA's filing noted that on 9/27, the new company [likely WWE, although that name is redacted] made a purchase offer "at a price very similar" to the one Corgan valued Impact at.

The same day, "after much effort and legal expense" on Carter's end to help Corgan negotiate his deal with Aroluxe, Corgan backed away from his offer to invest and stated he would provide no additional funding. It was noted that while Carter had her concerned, "she had relied on Plaintiff to secure the funding" for the Bound for Glory PPV and subsequent tapings because Corgan remained "confident that he could get a deal" done with Aroluxe.

It was noted that "Despite serving as President and knowing that funds were not available for production" if he did not complete his deal, Corgan made no effort to secure a backup source of funding for those tapings. "Plaintiff's last-minute action in pulling out and his lack of effort to arrange any other alternative left Ms. Salinas and Impact in an extremely difficult situation."

Carter "immediately scrambled to find replacement funding and engaged in more serious talks with Anthem regarding a loan." It was noted that "near midnight on the eve of the deadline to keep production on schedule", Anthem offered the financing, allowing the Bound for Glory PPV and the subsequent TV tapings that will carry the company through December to take place.

TNA's filing noted that by late September 2016, it had become "apparent" to Corgan that his plans to purchase the company was not going to succeed and that Impact now had access to other financing options and suitors, so he became more aggressive, stating that Carter was in default in a letter sent by his attorney. It was noted that Carter denies those allegations as well as the allegation that the company itself is insolvent.

On 10/12, Corgan issued a letter via his counsel "purporting to exercise" Carter's voting rights in order to remove the entire Impact Ventures Board of Managers in order to appoint himself the sole manager of the company. TNA responded that his efforts to remove them are "improper, without merit and are ineffective." It was noted that "In addition to being factually unsubstantiated and wrongful as a lender, Plaintiff did not secure the consent of Anthem before purporting to exercise" Carter's rights.

TNA noted that the next day, Corgan filed his lawsuit against them and the temporary restraining order has, as Corgan "no doubt hoped", delayed Impact and Carter from repaying his loan.

TNA also took issue with the idea that Corgan has claimed that despite being President of the company, that he has been "frozen out" of management. TNA claimed that Corgan's lack of involvement in management has been his own choice. It was noted that since taking on the position, he has only made two trips to the company headquarters in Nashville (8/29-30 and 9/26-27). TNA noted that during the trips Corgan "spent the overwhelming majority of the time with the company's creative team at the production studios" that are located in a different location from the company HQ "and/or attempting to negotiate a purchase of the company." During those visits, he only visited the company's primary business office once and "only for a brief amount of time", doing so during a time period that no one from TNA senior management was aware that he was coming or had they asked to meet with him.

TNA noted that their Board of Managers has been and remains willing to meet with Corgan. He, however, has made "little or no attempt to meet with the board to discuss strategy, the company's future or otherwise. It was noted that he was invited to take part in an in-person executive meeting for the company but only offered to make himself available via telephone. It was also noted that he was invited but declined to attend a locker room talent meeting on 10/3. This was the Dixie meeting with the troops meeting that PWInsider.com had previously reported on.

TNA's filing stated that Corgan "has instead conducted business on his own" and when asked by Carter why he was not involving others in planning or meetings, responded, "You are damaged goods. I don't intend to involve you."

TNA also denied that Corgan has been withheld from accessing the company books, records, etc. and that he had been given access to a digital data room containing that information.

TNA noted that its note to Corgan is unclear as to whether it can be paid back prior to the 11/1/16 date. It was noted that Anthem has proposed loaning Impact the money it needs to pay Corgan off. When Impact contacted Corgan's attorney to request a "payoff amount and communicate an offer to pay all principal and interest due", they were told the following by Corgan's counsel:

"The former Managers no longer have the authority to conduct those [i.e. borrowing] discussions on behalf of TNA, and are enjoined from doing so without our client's consent."

So, according to TNA, Corgan will not respond to requests to get a total amount TNA has to pay him, because according to Corgan, they are no longer in an official position to have that communication, to accept the money from Anthem or to pay Corgan off.

TNA states that Corgan's conduct "in attempting to block the efforts to repay his loan demonstrates that his true intend is to usurp" Carter's ownership and control of Impact.

It was also noted that Carter emailed Corgan on 10/17/16, requesting that he consent to Anthem providing the loan and paying him back. The next day, Corgan's counsel contacted Impact's counsel providing a payoff amount and "expressing a willingness to consent to the new loan and to accept repayment" on 11/1 subject to "certain easily satisfied conditions." One of those conditions was that the defendants all certify that there was no agreement that, if consummated, would constitute a "Corporate Transaction" - because Corgan claims he would be owed a bonus if that happens. TNA's attorneys provided the certification requested and asked Corgan's attorneys to confirm that everything would be stamped canceled and returned once he was in receipt of payment of his principal and interest from the loan.

"The hope that Plaintiff had seen the light and would act reasonably was short-lived." It was noted that on 10/20, TNA was contacted by Corgan's attorney and informed of an additional amount of money that they were now required to pay and that his note would be "deemed paid only on receipt of that amount." TNA noted that Corgan's game is obvious and that he "plans to constantly move the goal line in an effort" to prevent TNA from repaying his loan so he can continue his efforts to take over the company, all the while trying to limit Carter's ability to sell the company or secure additional financing and investments from others. Corgan is doing this, they allege, "in hopes that short term cash flow challenges will strangle the company and make it vulnerable to takeover."

TNA stated there is no agreement to sell Impact or its assets; there has been no "Corporate Transaction" since 8/11/16 and there will be none prior to 11/1/16. They note, "If Plaintiff will stop interfering, Impact can obtain further financing/investment to address its cash flow cycle and operational needs." They stated Corgan's refusal to accept payment on his loan is the "primary impediment" to Impact obtaining additional fund and continuing its operations.

In defending that the company was not insolvent, the company showcased contracted revenues for International Revenue through 2002, and listed projected advertising sales and sponsorship revenue for 2017 from Impact airing on Pop as well as PPV broadcasts. They noted that the cash flow issues came from Impact leaving Destination America and going to Pop TV and that the cash issued were "expected and required to transition the brand from a license model to a barter sales contract tied to advertising sales." In other words, Destination paid TNA for the content while Pop is paying TNA based on a piece of the advertising sales derived from TNA commercial time. TNA explained "the change was necessary in order to secure the company's valuable digital rights, full sponsorship/advertising rights and non-exclusivity rights, all of which are critical to the long-term growth of the brand." They also noted that "When making the transition, it is typical for advertising sales to take time to increase to a level at which the barter sales contract generates revenue similar to a license structure." It was stated that the company also expects additional short term funds including a payments from an international licensee the week of 10/24/16. It was noted that Impact has successfully borrowed money in the past as needed to fund operations and can continue to do so.

TNA asked the court to deny Corgan's claims and to deny his request for a temporary injunction.

Bless Spudz, gotta simmer through all this for SBR TLDR

Can't wait for the next Smashing Pumpkins album with the hit single "Dixie Carter, You Filthy Lying Whore".

I know Corgan is a big wrestling fan, but is this company really worth all this work? I actually hope Corgan wins all this and does get control of the company. Not because I have any hope in TNA turning things around and being a player in the wrestling business, but just to see Dixie finally kicked out of the power she only had thanks to her rich parents. It would be fitting for her to be out of power without a dime to show for it, instead of negotiating a sale and escaping with some cash before showing up on TNA themed documentaries on the WWE Network.

PWInsider.com has confirmed that in a ruling today, the Nashville Chancery Court has denied Billy Corgan's request for a temporary injunction against Dixie Carter, Serg Salinas, Dean Broadhead, Impact Ventures LLC.

The court has also dissolved Corgan's temporary restraining order against the company.

PWInsider.com is waiting on further details, but what this means is that Corgan will not gain control of TNA and that the current management can move forward with whatever choices and business they desire without having to get his approval.

This does not mean the end of Corgan's lawsuit against the company and TNA will still have to repay Corgan's loan of $1.8 million, unless Corgan opts to convert that debt into a 36% ownership stake in the company.


PWInsider.com has acquired the 19 page ruling issued by The Nashville Chancery Court this afternoon denying TNA President Billy Corgan's request for a temporary injunction against TNA, Dixie Carter, etc. and resolving the temporary restraining order against them.

In the ruling, Chancellor Ellen Hobbs Lyle wrote that she denied Corgan's request for several reasons.

The Chancellor noted that in order for Corgan to be entitled to a temporary injunction under Tennessee law, he has to show a substantial likelihood of success on the merits of his claim, immediate and irreparable harm, a balancing of the equity in the company in his favor and that issuing the injunction would not be harmful to the public interest.

However, the court noted that Corgan did not prove that TNA's defense is without merit, that a default actually happened under the Pledge Agreement between himself and Dixie Carter, that such a default would rightfully mean that Corgan could gain control of Carter's voting rights and that the amount owed and payable to Corgan has increased due to a corporate transaction.  So, since the court was not in 100% agreement with Corgan's claims, they would not file the injunction against Carter and the other defendants.

The Court also agreed with TNA's attorneys when they argued last week that the Voting Rights Provision of the Pledge Agreement between Corgan and Carter was "not implemented in accordance with TN Law" and the TN LLC Operating Agreement, therefore it was "unenforceable" and Corgan could not remove Dixie and the other Impact Venture management members.

On the subject of TNA parent company Impact Ventures being insolvent, Hobbs noted, "there has not been demonstrated a substantial likelihood of success on the merit because of the operative text of the Pledge Agreement 'becomes insolvent' is ambiguous when applied to the facts of record."  Since the court rules on hard facts and hard facts alone, they have to go by what the definition of insolvent is in the actual Pledge Agreement.  Since that is not spelled out in plain English with hard context as to what would and would not be insolvent, the court will not issue a ruling that the company is since there is no clear definition of what the term means in conjunction with the Agreement.  

It was noted in the response that the court "does not adopt" TNA's argument that the potential money coming in from potential "purchasers to buy the LLC or some of its assets refutes the facts and insolvency standards" that Corgan presented. The court noted that because of the unique facts of his case, the usual process that Corgan used and that the court itself might use did not apply. Noting that all the parties entered into the Pledge Agreement because TNA had financial issues, it is therefore hard to define that the company had become insolvent, because the company was already in "financial trouble and distress" when Corgan stepped in, noting that even TNA CFO Dean Broadhead stated on the record that without Corgan's help, "all would have been lost."

In her ruling. Hobbs stated, "Thus, the context of facts of the LLC's financial distress at the time the insolvency default provision of the Pledge Agreement was entered into by the parties in August 2016 creates an ambiguity about the meaning of the text of the provision that a default occurs under the Pledge Agreement 'if' the LLC 'becomes insolvent.' "

So, the court is stating that Corgan cannot prove that TNA is insolvent now because the company was in such bad shape that they entered into the agreement with him and there's no way - at thus juncture - to truly prove they are worse off now than they were in August because of the wording of the agreement.

It was noted that it is "not clearly established on the record" that the Defendants "have breached" their agreement with Corgan "by withholding or concealing information." The court noted that Corgan has a version of the facts and TNA has another and there is no clear proof at this juncture which side is correct.   The court noted that Corgan may be able to win at trial if he provides the proper evidence, but at this point, he cannot provide hard proof that they breached his agreement.

The court also ruled that the preliminary evidence filed on record that does not prove that there has been an acquisition of TNA and it's parent company by another party, so there is no current reason for Corgan to be owed the additional Corporate Transaction fee (which is believed, based on statements made in open court last week, to be an additional $900,000).

Corgan is still free to go forward with his lawsuit.  That is not dead.

TNA is also still required, contractually, to pay Corgan back his loan of $1.8 million on 11/1.  They can still do that.

edit
Corgan began tweeting shortly after the decision (sic):

- "Very pleased with the court proceedings today in Nashville. Appreciate those who've followed the case carefully, separating spin from fact".

- "For those asking, I'm in no way disappointed in the judges ruling regarding TNA. Rather, I'm grateful the judge considered the case".

- "It's important to note is these proceedings have brought forth facts which illuminate business practices I have fought against for a reason".

- "And I suggest that a careful reading on the judge's ruling supports there can be no claim of victory by anyone in a position of authority".

is Dixie Carter the worst wrestling promoter in the history of the business?

She might be the worst promoter ever, but apparently she is a tremendous pitch woman as she keeps getting people to put money into this sink hole.

I like that when you look at this topic on the front page it reads Corgan loses leg...

Billy Corgan posted on twitter...the following a few hours ago ..

FACT: TNA was supposed to pay me to 2 days ago, which they swore to in front of a judge. Yesterday they asked for a day to 'get $ together'

Upon which, (yesterday or today) they'd 'reach out directly' to settle ALL claims. So they lied again and have used the time as a weapon

FACT: I have still not been paid, and I'm exploring all remedies including new filings with court and converting to 36 pct. equity


and the new people in charge has a comment via the fightnet twitter

We reject Mr. Corgan's social media comments today re:@IMPACTWRESTLING. The matter is before courts/public discourse is inappropriate. There is a solid financial plan for @IMPACTWRESTLING & Mr. Corgan's loan will be dealt with appropriately.

lmao..
Billy fires right back at fightnet

Terrible way to start our future relationship! What w/ the lying through counsel + propensity for press releases claiming victory

So when you sent out the press release today and one during lawsuit (which is still pending FYI) that's not public discourse? Tsk!

And the use of 'reject' in your tweet! Such strong language from network of fights

The aftermath of the ruling from Meltzer's dirtsheet

This should end much of the drama that has enveloped the company over the last several months. No matter what the ruling was, and how deep the debt was, with both Anthem and Corgan willing to take over, the company itself was not in danger of folding going forward, nor risking its television contracts (its only significant revenue source) by not being able to afford taping shows. Had Corgan not come through with the money for three sets of tapings this year, and Anthem for the most recent taping, TNA would have had to cancel the tapings, and thus would have breached their contracts and the company could have gone out of business at that point.

SE Scoops and David Bixenspan reported on yet another lawsuit against the company, this one filed back in June in court in Nashville by Fraley International. The lawsuit is over Fraley designing and making merchandise for TNA such as T-shirts, sunglasses and cups. Their role was to design, source and order the merchandise from foreign suppliers, fronting all costs, and then being reimbursed by TNA after TNA received the order. The problem was that in September 2015, TNA stopped reimbursing them. They continued to get the runaround until they were owed $43,348.70 as of the last order shipped on December 22, 2015, which was the 23rd order not paid for, at which point they stopped working with TNA.

There is still some drama going forward. The irony through all this is that it appears Dixie Carter Salinas, husband Serg Salinas and COO Dean Broadhead will remain working in the office and get regular paychecks from the company, and will have job titles likely as part of their deal to sell to Anthem, but at least Dixie and Serg will likely have no power other than being able to save face with a corporate title. However their situation becomes problematic with the loss of the U.K. deal, because that would require cutting costs, and two of the highest costs are Carter Salinas and Gaburick's salary. Although if Gaburick was cut, the company would still have to find someone to take that position.

There will be no sale of the tape library to WWE, probably ever, as even if Anthem decides the company isn't financially viable and shuts it down, as owners of 85 percent of the company, they'll remain with the tape library.

Carter is no longer in charge, as Brown has taken over. The biggest drama revolves around John Gaburick, the head of talent relations. The belief is that Aroluxe wanted him gone and Carter wanted to keep him. Corgan also wanted him gone and was going to replace the entire management team. Perhaps in the fight with Corgan, where Carter, Aroluxe and Anthem were all together in the fight, that they're getting along and agreeing on things. The Gaburick question was the big one insiders were talking about after the ruling.

The other key involves those who were known to be close with Corgan, most notably head writer David Lagana. Another would be Josh Matthews, who is there due to a decision made by Gaburick, and has widely been considered a flop in his role as the replacement of Mike Tenay as lead announcer.

Most of the talent was political enough to not say anything because you don't want to end up on the bad side. Mike Bennett was the only one to comment publicly and he was a supporter of Corgan, and he did say it in a way that will get him heat. Privately, the reaction from most (not everyone because there were different viewpoints) was disappointment. Corgan had convinced them at the September tapings that he would be able to build the company. Some were heartbroken and most were disappointed it ended up like this.

"Welp, back to bad business as usual," wrote Mike Bennett right after the ruling came in.

His wife, Maria Kanellis Bennett, 34, then wrote, "News, any news doesn't ever tell the whole story. It will be an interesting next couple months. What I know is I am leaving wrestling soon. I'm not exactly sure when, but that's why I went back to school. I am done in May with my bachelors. And then, I'm on to my Master's degree. Eventually everyone must realize that the road never changes unless you change roads."

Davey Richards, 33, on 11/1 tweeted that 2017 would be his last year in wrestling. That is likely unrelated to this case. Richards has talked retirement multiple times for years so this is nothing new or unusual. He has just been cleared after reconstructive knee surgery on 2/16, and will start taking independent dates.

Also, in the lead story last week, the total gross revenues of The Fight Network of $4,550,000 in 2015, was only for Canada itself. According to company sources, total revenue is significantly higher than that as The Fight Network is now in 30 countries, and owns a piece of The Pursuit Channel in the U.S. as well as a number of other sports properties.

The Drama continues and we get the first TNA departure due to it...


By Dave Meltzer | @davemeltzerWON | Nov 4, 2016 10:25 am

The situation with TNA and Billy Corgan had a few twists and turns this morning stemming from a New York Post article by Richard Morgan.

The key to the story at this point is that even though TNA is being controlled and funded by Anthem Sports & Entertainment, for reasons of saving money based on the Corgan contract, they are claiming they haven't been sold, even though for all real purposes they have.

The point to this is that Corgan's deal with TNA when fronting them $1.8 million (a figure Corgan has now confirmed) is that if the company was sold, he was entitled to a 50% transfer fee, meaning the company would owe him $2.7 million. Anthem Sports has been willing to pay Corgan $1.8 million, or at times $1.9 million (claiming they were willing to pay six
percent interest), but not $2.7 million, and also insist on him dropping his lawsuit against them before they would pay him.

Corgan is asking for the money, but refuses to drop the lawsuit, and claims that if they don't pay him he has the right to convert the payment into 36 percent of TNA stock. It would be a minority interest. Anthem is clearly avoiding the term purchase of TNA and going through with an actual purchase, in order to avoid the transfer fee.

In court they had said they would pay the amount of $1.9 million (they said the number owed plus six percent interest) on November 1st. As of today, it had not been paid. TNA is demanding that if they paid the money, that Corgan sign a release, breaking all ties between the company which would mean that he would have to drop the ongoing lawsuit and could not sue the company going forward.

In the Post article, a TNA source claimed that the judge (Ellen Hobbs Lyle of Nashville Chancery Court) ruled that the company had not been sold.

"Billy's saying the company was sold and he's owed $2.7 million," said an unnamed source. "But the court has already determined the company was not sold."

Technically in company papers Dixie Carter is still listed as owning 92.5 percent of company stock, even though the agreement privately in the new organization of the company would be that Anthem would own 85 percent, Aroluxe would own 10 percent and Carter would own the remaining five percent.

Corgan then started tweeting after the article came out:

"YEP: Just published NY Post article asserts that judge in case ruled against my receiving 2.7 in Anthem swap deal. This is FALSE. Case OPEN."

"Today I'm FORMALLY requesting repayment of my 'so-called' loan by TNA, which I'm told stalled because they didn't know where to FIND ME."

"Laughs aside, I'd put up 1.8mil for express purpose of becoming equity stakeholder and helping talented roster. Any other assertion is FALSE."

"So if I'm not repaid today in full and without conditions attached, I'll be forced to once more pursue remedy by taking TNA stock via court."

"Remember it was Anthem and not I who stood in open court and told judge they were prepared to PAY and in turn FUND good ol solvent TNA."

"A Company which they claim they have no business deal for behind-the-scenes yet have released 2 press releases saying they are TAKING OVER."

"So far be it from me to accuse someone I don't know of bending truth to win a case. That just wouldn't be nice, and I believe in being nice."

"Last thing: Despite being called a lender by every arm of TNA propaganda, I can still convert to a 36 percent stockholder or sell option to highest bidder."

"And that option if you will to convert my boo-hoo-hoo loan to 36 percent stock or auction it off to a PW titan doesn't require a court order."

The implication here is that Corgan would attempt to sell his percentage if they don't pay him to WWE, but I'm not sure what WWE would want with a minority interest in a rival company. WWE has had talks with existing companies about becoming a stockholder, but always insisted on 51 percent, which is why deals haven't been made.


David Lagana parting ways with TNA Wrestling
By Dave Meltzer | @davemeltzerWON | Nov 4, 2016 2:27 pm

TNA head writer David Lagana announced today that he has left the company.

Lagana, who had worked for years with WWE and then with ROH, before going to TNA, wrote that, "Today I made the decision to leave TNA Impact Wrestling. A decision I do not make lightly but one I made to create a future that I control. In 2017, you need to look forward to 2020 and beyond. My focus now is on personal branding, technology and the wild west of storytelling available to all content creators today."

Lagana started with TNA in 2011 after being hired from ROH.

In a farewell article he noted learning from Vince McMahon, Paul Heyman, Dusty Rhodes, Pat Patterson, Gerry Brisco, Shawn Michaels, Paul Levesque, Michael Hayes, Brian Gewirtz, Adam Pearce, Hunter Johnston, Matt Conway, Billy Corgan, Vince Russo, Eric Bischoff, Bruce Prichard, Jeff Jarrett, and Dutch Mantel.

It is very notable he did not include John Gaburick or Dixie Carter on that list.

Lagana was expected to be a more powerful player in the new TNA under Corgan, but he was expected to be in a tenuous position when Corgan didn't get control of the company.

Billy Corgan announced this morning on Twitter that he has signed his settlement with Anthem and TNA Impact, effectively officially closing the door on his involvement and entanglement with the beleaguered wrestling company.

“Just signed my settlement with TNA/ANTHEM,” he wrote on Twitter. “And to fill in the blanks I’ll do a few interviews next week to spell out what is/isn’t in it.”

He thanked the pro wrestling media that handled the story “with balance.” He added that “the true story on TNA involves a lot of men and women I respect and appreciate (both roster and crew), and they deserve the best.”