The Big Picture
SUMMARY
TUST Chairman Nick Brodrick and two board members met with a club director and the club’s advisors on 27th February.
A Notice of Intention to put the club into administration was served on 22nd February and a further NOI for another period of 10 business days was lodged on 7th March.
The club is not yet in administration but still faces a ten point deduction after filing the Notice of Intention.
We have been told that Clarke Osborne will write off monies owed to him.
There are potential buyers, several of whom have contacted TUST.
TUST is working and will work with potential buyers who value fan and community engagement.
TUST is also talking with possible “consortium members”.
Full fan ownership via a Community Share Issue has not been ruled out but is not the preferred option at this stage.
We have reason to believe that fall back plans for a phoenix club will not be necessary, but planning continues just in case.
The TUST Crowdfunder set up last month has raised £5,034 so far. Those wishing to donate direct to the club should visit. https://www.paypal.com/donate/?hosted_button_id=LP7HTGB8DG24J
The club has asked for direct funding from TUST’s Forever Yellow contingency fund. TUST board does not feel that it is appropriate to apply the fund in this way as it was not accrued with this intention and the board is accountable to its members.
After discussions with Weymouth Football Club, TUST is forwarding all the monies donated to TUST by Weymouth to the club to help fund player and staff wages.
In addition, TUST is actively engaging in a social media campaign to encourage supporters to attend Plainmoor and to boost club revenue through bars, the club shop, 50/50 draw etc.
TUST membership has now passed 750.
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THE FULL STORY......SO FAR
We apologise for the delay in issuing this statement. We have been seeking confirmation on certain points from the club and its representatives but have not yet received all that we requested. We have decided to publish what we can as we recognise members need to be kept abreast of information we can share.
TUST meeting with TUFC
Chairman Nick Brodrick and TUST board members Matt Gorman and Rick Williams met on Tuesday 27th February with club director Mel Hayman and representatives of the proposed administrators (Begbies Traynor) and their solicitors (Stephens Scown) who are handling the administration procedure and potential sale of the club.
It was a positive meeting which concluded with all parties agreeing to work together towards the common goal of ensuring the long term future of our football club.
Here are the key points from the meeting;
The owner has served a Notice of Intention to put the club in to administration with the courts as he is no longer able to finance its operational costs.
We were told that Clarke Osborne and his companies do not expect to recover any of the money he has put into the club.
The notice was served on the evening of Wednesday 21st February and was lodged with the court on Thursday 22nd February. It expired after 10 business days on 7th March but a further notice period of 10 business days has been granted by the courts. The notice prevents action by creditors during this period.
In the meantime the club is seeking potential buyers and is supported in this process by its advisors.
There have been a significant number of expressions of interest, although only a small proportion are likely to have sufficient financial capacity or relevant experience to support a valid offer.
All those expressing an interest are sent a pack requiring them to sign a Non-Disclosure Agreement (NDA) and complete a questionnaire with the details required for the FA’s ‘Fit and Proper’ test of ownership.
Those applicants satisfying the club of their genuine interest and importantly “their proof of funds” will receive details of the club’s current finances etc to enable them to complete their bid.
At a given time (to be decided) the club and its appointed advisors will short-list the best offers and complete a selection process which will hopefully result in a new ownership structure being put in place.
The proposed administrators and legal advisers are working to ensure the best outcome for the football club. To be clear, prospective new owners are being asked to ensure their bids include demonstrating the financial capacity to support the club over a minimum 3 year period. The question was asked at our meeting as to what level of finance this would amount to and broad numbers were indicated. However, the amounts concerned will be clearer when access is granted to financial information by those applicants who meet initial criteria.
The whole administration process is complex and in addition to the application of Insolvency Law there is a need to consider how the National League also deal with what are known as “Insolvency Events”. We have had guidance from the Football Supporters’ Association (FSA) on the onerous FA / National League rules on clubs which are subject to an insolvency event and we are seeking assurance that prospective bidders are made fully aware of these.
It is our understanding from a strict interpretation of the National League (NL) rules that a 10 point deduction is triggered by any ‘insolvency event’ and an insolvency event includes the serving of a Notice of Intention. We are advised that the NL may have some discretion in this matter. As the club has not confirmed any penalty it is possible that they have reached an agreement with the NL. If a points deduction has been triggered, it is our understanding that this will apply to this season.
We understand that the February staff and player salaries were paid in full.
There were no debts to HMRC at the date of the Notice of Intention being served on February 22 but we are not clear whether tax and NI on January’s payroll have been paid as they fell due on that day.
The critical thing now is to ensure sufficient funds are in place to cover the salaries of players and staff which will be due towards the end of March, and other operating costs.
We are advised that the costs associated with the administration and associated legal fees will be met by the new owner. They are currently working ‘at risk’ and in the event of no new owner being found they will not be paid.
With the above proposals in place we have sought absolute confirmation that all money now going in to the club from ticket sales, commercial activity or donations will only be used to meet operational costs. We were told at our meeting that all income will go into an account held by the solicitors and be ring-fenced for this purpose but this has not been formally confirmed.
Despite the assurances given above, we are mindful that there is still the possibility of Clarke Osborne agreeing a sale to a new owner ahead of the administration. If the club enters administration any decision on a new owner will be made by the administrator.
TUST’s position
The last couple of weeks have been somewhat frantic to say the least!
We have been overwhelmed with offers of practical or financial support from fellow Gulls, supporters of other clubs, their trusts and those with hands on experience of working within the game.
TUST Membership has increased by 50% in the space of 2 weeks and we have just recently welcomed our 750th member!
We have also successfully highlighted the club’s plight through various national and local press articles and media interviews including TalkTV, BBC Sport, Radio Devon and The Price of Football podcast. At all times it has been important to highlight what a great club we have and the need for all supporters to get behind it at this time.
While there are no certainties (and specific information from our meeting has to remain confidential) the TUST board are satisfied that the actions outlined at our meeting and the expressions of interest from prospective owners offer a promising solution to the present plight of the club. We are ourselves in discussion with a few interested parties to support their applications and one in particular offers an exciting, deliverable vision for the future of a community based club. We have also spoken with a number of the other potential owners with a view to securing supporter involvement in any future running of the club. We hope to engage with all short-listed bidders and to this end the administrators have indicated that they will encourage serious bidders to contact TUST if they have not already done so as a collegiate approach with TUST moving forward is seen as beneficial in view of the ever increasing TUST membership and the positive impact TUST can have on the club.
The football club has asked TUST to make a significant contribution to its current running costs to help ensure its survival while the above process plays out. Clearly, there is a cashflow requirement in the absence of any additional funding being committed by the club’s current owner. Whilst revenue streams are being maximised and the support from TUFC fans and the football community at large with donations has been fantastic; the concern is that players and staff need to be paid in full at the correct time in order to ensure that complete focus can be given to results on the pitch as the team aim to generate the highest league position possible, particularly in light of any possible points deduction.
Details were provided to TUST to quantify what finance was required and by when.
It was made very clear to all present at the meeting on the 27th February as to the objectives of TUST and how capital held on behalf of members was to be used.
As members may be aware, TUST has a Forever Yellow Fund, currently standing at £60k, which it has built up over the past few years to enable it to take whatever action might be needed in a crisis to save or relaunch the club. It has never been the intention that such funds would be used to buy the club or meet its running costs but to facilitate the rescue through consultancy or legal costs etc. The board intend to retain these monies for that purpose in the event that a change of ownership is not facilitated and the club does indeed go into liquidation and requires resurrection. It is important to note at this stage that your TUST board have gained increasing confidence from the meeting held with the club and officials that this will not be necessary, but we need to remain prudent and ensure that reserves are retained for the purpose for which they were originally intended. It is also important to note that our cash reserves are increasing steadily by the day as a result of the influx of new members and donations that have been made directly to the TUST bank account (outside of the Crowdfunder exercise).
Indeed, you will be aware that TUST launched a separate Crowdfunder page the day after Osborne’s announcement. It has been stressed that this was a tool to provide a central point for donations to TUST at this time rather than having multiple fund raising pages set up by well-meaning individuals who were keen to raise money for TUST.
It was also made clear that any donations would be held by TUST in support of our longer term objectives to secure the club's future. The page was set up to provide an independent vehicle for fans to donate to should they desire, in the knowledge that funds will be used in a responsible manner towards this goal.
As at 6th March, 125 donations have been made totalling £5,304 which is a fantastic sum over such a short period and we would like to place on record our sincere thanks for all that have contributed.
Your TUST board have carefully considered the position outlined in this statement alongside information provided by the club, proposed administrator and legal advisers to determine the most appropriate course of action to take at this time in order to help secure the long term future of the club but no decision has yet been taken on how to use the Crowdfunding cash.
Following our meeting on 27th February and developments since, we are reasonably confident that a new ownership structure can be implemented in the near future. We are keen to be involved in the running of the club moving forward in order to represent fans, but do not feel TUST funds would be best spent on commencing our own ownership bid at this time in view of the indicative capital investment that would be required, the existence of other potential credible owners and the timescale involved. That is not to say we are completely discounting this option if events change.
However, it is possible that TUST could form part of a wider ownership structure and discussions are being held with a number of interested parties in this respect. We continue to believe fans need to be represented formally and this is something we are keen to push for.
We had the very generous offer from Weymouth FC to donate £5 to TUST for every away adult ticket sold for Saturday’s match. Following developments over the last couple of weeks as outlined in this statement, we have agreed with Weymouth FC that these funds should be used towards this month’s salaries and they will be passed on to the club for this purpose. In addition to this offer, Weymouth Supporters Trust also held a bucket collection and sold badges raising another £335 and we have had offers of donations from other supporter’s trusts. It is our intention that such funds will also be donated to the club at this time.
In conclusion
It must be stressed that your TUST board have spent a considerable amount of time over the past fortnight considering all avenues and the decisions we have made above follow a full assessment of the position by the TUST board. We truly believe it is in the best interests of our members and the TUFC family as a whole. It is also about ensuring all fans and any prospective owners can see how TUST can play an important supporting role in the club from here on.
With a potential points deduction, the club faces the prospect of a relegation battle. We urge all supporters to get behind Aaron Downes and his team as they fight for every point and also to support the club financially in any way they can on matchdays and throughout the week.
NOW IS THE TIME WHEN WE REALLY DO NEED TO BE ONE CLUB UNITED!
SUPPORT TUST - SUPPORT YOUR COMMUNITY
