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The Commercial Appeal (Memphis, Tennessee)
A buy-sell clause in the Memphis Grizzlies' ownership agreement has been exercised, according to The Athletic.
Grizzlies controlling owner Robert Pera must decide whether to buy out minority owners Steve Kaplan and Daniel Straus or sell them his shares at a team evaluation that Kaplan or Straus sets.
Triggering the buy-sell agreement means all parties have a 60-90 day window to engage in good-faith negotiations, a source confirmed to The Commercial Appeal. Neither Kaplan nor Staus has made a bid, but they are officially on the clock to do so.
When Pera bought the team from Mike Heisley in October 2012, he agreed to a buy-sell arrangement. So, for example, Kaplan could offer to buy the Grizzlies at the price of $1 billion, and Pera would either have to sell his 25-percent share of the team for 25 percent of $1 billion, or he'd have to buy out Kaplan's 14-percent share of the team for 14 percent of $1 billion.
That arrangement, which was suggested by former NBA commissioner David Stern as a safeguard in case Kaplan or Straus didn't like being minority owners with Pera, kicks in "after five years, and every three years thereafter."
The Grizzlies sold for $377 million in 2012. NBA franchise values have skyrocketed since then - the value of the Grizzlies has more than doubled, while the Houston Rockets and the Los Angeles Clippers each sold for at least $2 billion in recent years.
Columnist Geoff Calkins contributed to this report.
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