The Citigroup connection with the New York Mets baseball team is readily apparent - the team plays at CitiField stadium.  [C-I FYI:  It's sometimes referred to as 'FinraField' - thanks Gene.]  Not so apparent is the team's connection with Bank of America and JPMorgan Chase.  For the answer, look to Bernie Madoff trustee Irving Picard. 

According to Mr. Picard, who's seeking $1 billion from the Mets owners and related parties, the team's owners may default on their $500 million debt - held by BofA, JPM, Citi - if they pay $100 million or more to settle a Picard's lawsuit, according to a court filing.  Sterling Equities Inc., the company headed by Fred Wilpon that owns the baseball team, restructured more than $500mn in debt after Madoff was arrested in December 2008. 

Sterling’s restructured loan agreement says ... that a "final nonappealable" order or settlement, which may be as little as $50mn, or more than $100mn, would constitute "an event of default under those facilities," Picard wrote in the complaint.  Such a default would trigger guarantees by affiliates of Mets partnerships, so any proceeds they received from a sale of the Mets would go to the banks, he said.

If a borrower violates a provision in a loan agreement or misses a payment, banks may have the right to demand their loans back or seize assets in payment.

The Mets said in January they are seeking to sell as much as 25% of the team to raise money because of uncertainty surrounding the Madoff-related lawsuit.  However, according to NY Mets lawyer David Cohen, proceeds from the sale of a minority stake in the Mets would be reinvested in team operations and will not be used to repay Sterling debt."  Sterling said the same thing in a court filing.

Commenting on the bank covenants, Cohen said, "An event of default relating to a judgment does not reflect an expectation that a judgment will occur."

The fate of the NY Mets - as far as determining who owns the team (and/or how well it plays on the field) may depend on ... Bank of America, JPMorgan Chase and Citigroup. 

So, there you have it - "in a nut shell."  For the complete story, go to:   [Bloomberg, 3/24/11, "Mets Owners Settling Case .."]

The case is Picard v. Katz, 10:05287, U.S. Bankruptcy Court, Southern District of New York.