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The Sale of the Saints
Mecom decided to sell the Saints after a disappointing 1984
football season. He established a sale price of $75 million for
the team and subsequently engaged the services of Thomas E.
Thompson (Thompson), Gary Jones, Gus Blackshire, Jack Allendar,
and Bill Becknell, as well as certain other individuals
(collectively Mecom's negotiating team), in order to attain his
desired selling price. Mecom derived the sale price without
assistance of an appraisal evaluation or other expert advice
regarding the fair market value of the Saints. Similarly, he did
not consider or plan for the tax consequences associated with the
sale of the team.
Despite having had no prior business experience with
professional football, Thompson was the chief negotiator among
the members of Mecom's negotiating team. Thompson initially
thought that Mecom's asking price of $75 million was excessive
because the Saints had a poor financial record and recent reports
indicated that the fair market value of the Saints ranged between
$40 and $45 million. Thompson's concerns, however, were
eventually dispelled, and he became convinced that the price was
reasonable. Facilitating the change in Thompson's point of view
was the prospect of public sector financing. More specifically,
Thompson came to view the impending expiration of the initial
term of the 1975 Lease as a viable tool that could be used to
generate interest among cities and States interested in luring
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