Senile Council Article

[Twitters]

Interesting comment from "Roger Ibbs" in the Sentinel comments section:

 

This clause was in the original loan agreement signed years ago.

This was put in because the council were lending the money to a club owned by its supporters (a social enterprise).

It had nothing to do with Bill Bratt or the present board.

It was stipulated that the loan had to be repaid if ever the ownership moved to an individual and out of the hands of their supporters.

The clause was inserted by the Transformation and Resources Committee and agreed by the Council. It was not put in at the request of the then board it was done to protect the Council's interests.

If you compare it to the Brit loan for the new ground this was repaid by Peter Coates with a £2+ Million increase from the original loan.

 

Of course, he'd have no reason to run down Mo would he?

[yato]

Just seen this on the comments section on the senile webpage in relation to the article, posted by Roger Ibbs.

 

This clause was in the original loan agreement signed years ago.

This was put in because the council were lending the money to a club owned by its supporters (a social enterprise).

It had nothing to do with Bill Bratt or the present board.

It was stipulated that the loan had to be repaid if ever the ownership moved to an individual and out of the hands of their supporters.

The clause was inserted by the Transformation and Resources Committee and agreed by the Council. It was not put in at the request of the then board it was done to protect the Council's interests.

If you compare it to the Brit loan for the new ground this was repaid by Peter Coates with a £2+ Million increase from the original loan

[Timothius]

Hes said many times, 5m. He will borrow the club upto 3.8m to clear the council and other debt if necessary (ie if he cant renegotiate the council to a better rate).

 

He will lend, the club will borrow, sorry to be pedantic.

 

The clause means he can't renegotiate onto a better rate with the council as it has to be paid off in FULL within 60 days.

[AVIM]

The clause means he can't renegotiate onto a better rate with the council as it has to be paid off in FULL within 60 days.

 

But he has upto 3.8m in cash, sitting there, to lend to port vale. So whats the problem?

[Burslem Academicals]

OK, I will!

 

The actual terms and conditions say:

 

7.2 Mandatory Prepayment

If there occurs any Change of Control in respect of the Club the Club shall prepay the Term Loan together with accrued interest within 60 days of such request from the Council.

 

In the Definitions section at the beginning of the document it says the following:

 

"Change of Control" means the occurrence of a situation whereby in relation to a company any person or group of persons acting in concert (other than the shareholders of a company) as at the date of this Agreement) gains:

 

(a) The ability to control the composition of the company's board of directors or equivalent body whether through ownership of voting capital. by contract or otherwise: or

 

(b) the ownership of shares or the right to acquire shares in the capital of the company) conferring in the aggregate 50% or more of the total voting rights conferred by all the shares in the capital of the company for the time being: or

 

© the power to exercise voting rights conferring in the aggregate 50% or more of the total voting rights conferred by all the shares in the capital of the company for the time being:

 

 

So I think you'll agree it does apply in the instance of someone buying 51% of the shares.

 

So if Mark and Mo each purchased 24.9% which would be under 50% then the clause would not be triggered.

Anyway the ground is worth 3.5 million and the debts are 3.5 million so the

club is worth £1....so to pay 1.2 million for 51% and then have to find 2 million within 60 days is enough to put anyone off.

The way it is looking it will all be up to the Administrator and the council should snap Mo Chaudry's hand off for a million back on a lost cause.

[tisdeano]

But he has upto 3.8m in cash, sitting there, to lend to port vale. So whats the problem?

 

as i asked earlier, you have no experience of aquisitions & mergers

[lydiatevaliant]

Its "valid" in the sense that v2001 would only relinquish control of the club to someone who has sufficient funding in place to either clear the debt, or set up alternative lines of credit, or meet with the approval of the clubs main investor (the council).

 

The clause acts to support this view.

 

It basically gives the council veto over any takeover of control my someone who doesn't have capital. They can choose to renew the loan with Mo if they see fit. As the biggest investor in port vale, that doesn't seem like an unreasonable veto to have? As we have all agreed here many times, who will invest as large amount as 2.2m in the club without having some say?

 

The board themselves don't have anything like sufficient funding to clear the debt immediately so why on earth should they insist a new owner must have? Isn't that yet another example of rank hypocrisy by V2001?

[Fosse69]

OK, I will!

 

The actual terms and conditions say:

 

7.2 Mandatory Prepayment

If there occurs any Change of Control in respect of the Club the Club shall prepay the Term Loan together with accrued interest within 60 days of such request from the Council.

 

In the Definitions section at the beginning of the document it says the following:

 

"Change of Control" means the occurrence of a situation whereby in relation to a company any person or group of persons acting in concert (other than the shareholders of a company) as at the date of this Agreement) gains:

 

(a) The ability to control the composition of the company's board of directors or equivalent body whether through ownership of voting capital. by contract or otherwise: or

 

(b) the ownership of shares or the right to acquire shares in the capital of the company) conferring in the aggregate 50% or more of the total voting rights conferred by all the shares in the capital of the company for the time being: or

 

© the power to exercise voting rights conferring in the aggregate 50% or more of the total voting rights conferred by all the shares in the capital of the company for the time being:

 

 

So I think you'll agree it does apply in the instance of someone buying 51% of the shares.

 

The council has to "request" payment, what would be the reasoning? Obviously if they consider the new "owner" financially unstable they would push it, otherwise accept payments and carry on as before?

[AVIM]

as i asked earlier, you have no experience of aquisitions & mergers

 

So are you saying he doesn't have 3.8m to lend to port vale as per his prospectus?

[Badgerspaws]

I see that the good friend of Port Vale, Roger Ibbs, has penned a comment on the Senile website. Again, he seems to have forgotten that Stoke's loan was interest free.

[tisdeano]

So are you saying he doesn't have 3.8m to lend to port vale as per his prospectus?

 

No I didnt, why would you assume that ?

[Burslem Academicals]

But he has upto 3.8m in cash, sitting there, to lend to port vale. So whats the problem?

 

Mo Chaudry is worth over 60 million and said last night that there is actually 31 million ready cash but that is not all for Port Vale....the initial 1.2 million is for 51% and the up to 5 million investment plan leaves 3.8 million for the project over time.....Mo Chaudry wants to clear the debts but would probably

want to negotiate a favourable settlement and not pay the full amount and certainly not in 60 days.

[Andyregs]

What an awful excuse for a paper.

[Twitters]

What a surprise, the comments section has conveniently gone down!

[IanW]

What a surprise, the comments section has conveniently gone down!

 

Nah it's still there, just takes a little longer to load than the rest of the page.