10/08/2010 02:43:00 am

Broughton vs. Hicks: The current LFC legal situation examined (with evidence)

Liverpool fans are on a cautious high at the moment - it finally looks like Tom Hicks and George Gillett may be ousted from the club; a dreaded points deduction is off the table (it is! Don't believe the press); and new owners are waiting in the wings to take over. However, at this stage, the sale is merely pending - there is a major legal conflict to overcome, and having examined the legal document that Liverpool Chairman Martin Broughton is using to validate the sale, I have to say that things are not as cut and dried as they seem.

This is a long article, but in order to present a comprehensive overview of the situation, a soundbyte approach is just not going to cut it. If you don't have the attention span then I'd stop now (!) If you want to be in full possession of the facts (and thus in a position to make up your own mind), then read on:

BACKGROUND: WHAT HAPPENED WITH THE SALE?

* A Board meeting was called for Tuesday 5th October to examine two bids.

* Broughton, Purslow and Ayre gathered for the meeting at the offices of Solicitors Slaughter & May, beginning at 3:30pm.

* 15 minutes before the meeting was due to convene, a faxed notification was received from Hicks stating that that Purslow and Ayre were fired, and that they were to be replaced with Hicks' son Mack and, his assistant, Lori Kay McCutcheon.

* With Hicks Jr. and McCutcheon on board, Hicks would have the voting power to veto the sale.

* After taking legal advice, Broughton decided that Hicks did not have the right to change the board, and restarted the meeting.

* Hicks declined to take further part in the meeting. Broughton, Ayre and Purslow proceeded to approve the sale to NESV, and decided to a declaration from a high-court judge that the way they proceeded was legal.

BROUGHTON'S ARGUMENT

* He was the only person entitled to make changes the LFC board of directors.

* That power was written into the articles of the covenants.

* Hicks and Gillett agreed that they would take no action to frustrate any reasonable sale.

* Hicks and Gillett gave written undertakings to RBS, one of which was agreeing to point that Broughton has sole power to change the board.

HICKS' ARGUMENT

* He did not agree that Broughton would be the only person granted authority to change the board.

* He had the legal right to sack Purslow and Ayres, and bring two Directors on board (thus giving him a majority).

* He has a duty to the club's shareholders to pursue the best price for the club.

* The price on the table from NESV is not good value for the club or its shareholders.

Yesterday, Hicks' New York-based spokesman Mark Semer said, "There were no such undertakings given to Broughton, the board has been legally reconstituted, and the new board does not approve of this proposed transaction."

LFC ARTICLES OF ASSOCIATION

I've obtained a copy of the redrafted Articles of Association (AoA) for the LFC Board of Directors (the document to which Broughton refers when he says ‘written into the articles of the covenants’):



After examining it, I think it's fair to say that the legal position is far from certain at the moment. To illustrate this, I will address a few key questions, and provide evidence to back up my conclusions.


Q. Is it (legally) correct that Broughton was granted sole power to make changes to the boar


Article 81 of the LFC AoA:



As you can see, Broughton – the Chairman of LFC – has the right to appoint or remove any Director of the company except Hicks and Gillett. Article 83 lists the reasons for which a director can be removed, and A83 (g) again confirms that the Chairman has the right to remove Directors.

This article looks clear and explicit, but it is not. Nowhere in the AoA is it explicitly stated that this is an exclusive or sole power, or that it supercedes Hicks and Gillett's power (as majority shareholders) to remove members of the board. If A81 was designed to grant Broughton exclusive, inalienable power to reconstitute the board, then the provision is not as clear as it needs to be. This will provide Hicks with an opportunity to challenge Broughton’s power.

Obviously, people will argue that A81 is the smoking gun - case closed for Hicks, but I argue that it is not that simple; and interpretation of such clauses can very from person to person, including Judges. It all depends on the persuasiveness of the argument presented (and any available precedents, of course).

Q. Did Hicks have the right to sack Purslow and Ayres and ‘reconstitute’ the board?

Unfortunately, I believe Hicks could make a case for having the power to do that. There are two possible methods that I can see (NB: Please remember I am highlighting approaches Hicks might take, NOT what I would do, or think is right).

(ii) Companies Act 2006

S168 of the Companies Act 2006: Resolution to remove director, states:

(1) A company may...remove a director before the expiration of his period of office, notwithstanding anything in any agreement between it and him.

(2)Special notice is required of a resolution to remove a director under this section or to appoint somebody instead of a director so removed at the meeting at which he is removed.

(3) A vacancy created by the removal of a director under this section, if not filled at the meeting at which he is removed, may be filled as a casual vacancy.

(4)A person appointed director in place of a person removed under this section is treated…as if he had become director on the day on which the person in whose place he is appointed was last appointed a director.

Hicks could conceivably use this clause as justification for removing Purslow and Ayres. He and Gillett are the majority shareholders; section 3 clearly states that new Directors can be appointed at the same time as removal, and the fax (i.e. written communication) sent to Slaughter and May informing them of the sackings could constitute 'special notice' (within the meaning of section 2). There could conceivably be a precedent somewhere in case law that stipulates that the time limit for special notice can be decreased if the situation is grave/important enough. (Sorry, I didn't have time to check this out but I would bet my house it's a possibility).

(iii) Valid dismissal?


Ultimately, Purslow and Ayres are employees of Liverpool FC, and both are Directors of company that runs LFC (Liverpool Football and Athletic Grounds Ltd). Hicks and Gillett own LFC (and two separate UK based holding companies associated with the club), so they can – in theory – sack anyone. If Purslow and Ayres are sacked they would - in theory again - cease to be Directors. Why would Hicks go down this route? It’s cheaper for him to pay unfair dismissal compensation than risk a multi-million pound loss, which will happen if the NESV sale goes through.

There is no immediate legal bar preventing Hicks from sacking Purslow and Ayres. He could even argue gross misconduct – Ayres and Purslow will have employment contracts, and they’ve clearly been working against Hicks; defying his wishes in such a manner could be deemed to be gross misconduct (I'm sure Hicks' lawyers could twist it that way). Broughton took legal advice and continued with sale anyway (probably relying on article 81), however, that article does not remove the right to dispense with employees.

As I mentioned earlier, nowhere in the AoA is it explicitly stated that Broughton’s right to appoint/remove Directors is an exclusive or sole power. This is the point that could complicate things.

Q. Are undertakings made to RBS by Hicks and Gillett legally binding, and do they have any direct bearing on the sale process?

According to Broughton, Hicks and Gillett agreed NOT to frustrate any reasonable sale, and this was recorded in written undertakings to RBS. This undertaking is not, however, recorded in the AoA. As such, it is not legally binding when it comes to the sale.

There may be a separate document in existence that records this promise, and that may be construed as a contract; RBS will then (probably) argue that H+G have breached that contract.

The AoA regularly refers to statutory law, specifically the Companies Act 1985/2006. No separate written undertaking can take precedence over Acts of Parliament.


Q. Is the sale to NESV 'unreasonable'?


The reported sale price to NESV is 300m. Hicks could (and probably will) argue that the sale is 'unreasonable' by virtue of the sale price. If Liverpool is independently valued at a higher amount than NESV is offering, he could argue that the unreasonableness stems from selling the club too cheaply, or ignoring other more reasonable/profitable bids. And under the 2007 Companies Act, it is the fiduciary duty of any director to obtain the best value for a company and its shareholders.

Q. What will the High Court have to decide when considering if the sale is valid?

1. Did Hicks have the legal right to sack Purslow and Ayres?

2. Did they have the legal right to appoint two new directors?

3. Is the Chairman’s power to appoint/remove Directors (enshrined in A83) an exclusive power that takes precedence over the rights of Hicks + Gillett.

4. Did Broughton have the right to press ahead with the sale despite objections from Hicks + Gillett?

5. Do any undertakings made by Hicks and Gillett to RBS have any legal validity when it comes to the sale?

6. Is the sale price for LFC unreasonable (within the meaning of the Companies Act 2007)?

Q. What’s likely to happen?

It is by no means a foregone conclusion that the sale will go through, and it is entirely possible that the high Court will rule in favour of Hicks and Gillett. Indeed, Broughton himself cannot guarantee that the sale will go through, as he indicated in a recent comment:

"I think we'll get there, but I can't make a promise. If the case goes against us, we do have a fallback position, but we're not prepared to discuss this at present."

Even if Hicks get the ruling, unless they find the money to repay the RBS loans, their holding company – Kop Football Ltd – will go into administration. RBS will then sell the club, and the end result will (probably) be the same: NESV as owners.

The worst case scenario is that Hicks and Gillett have already found someone to fund their refinancing deal and/or they're willing to put in their own money in. Given the zeal with which they’re trying to veto the NESV deal, that possibility shouldn’t be discounted.

If the High Court rules in Hicks’s favour, the sacking of Purslow and Ayres will be duly ratified; Hicks’ two new board members will stay, giving him a majority; the board will then reject the NESV bid; the RBS loans may be refinanced, and Hicks will hang on a little longer for a bigger deal.

Nobody wants this to happen, and to be honest, I don’t really think it will. Article 81 will probably be interpreted in Broughton's favour, even if it's not as clear as it could be. However, the law gets it wrong sometimes (!), so fans should prepare themselves for the worst case scenario...just in case!

EDIT: This article has received the seal of approval from leading law magazine 'Legal Week', who retweeted the article earlier. They don't do that unless the content is legally sound.

EDIT: Hysteria surrounding a potential points deduction is growing as the media milks this situation for all its worth. I will be posting an article in the next couple of days illustrating (with hard evidence) how and why LFC will not receive a 9 point deduction. Don't believe the negative hype!

NB. Iphone App users - images are not displaying on the app for some reason so you will have to visit the site to get the full article.


Jaimie Kanwar





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149 Comments :

guest said...

wow..I usually don't subscribe to a lot of ur opinions but here you articulated things the way my l view the process as well. i know a bit of business Law but this is uncharted territory so it could go either way. The onus is on RBS shareholders to question why RBS did not get water tight guarantees in protecting their investment. should Hicks and Gillette default on RBS loans since there is no guarantee RBS will get the full amount in administration. Tax payers as the majority shareholders stand to foot a possible hefty loss. Good article by the way.

mcphee said...

Jamie. Great article.

Write more like this, and less that are just petty squabbling with other fan sites

mcphee said...

Jamie. Great article.

Write more like this, and less that are just petty squabbling with other fan sites

Ken said...

I work on legal docs like this daily and I think your interpretation is wrong. It is explicity stated that any removals or additions need to be made in writing and signed by the chairman - the chairman, not major shareholders, or other board members.

So Hicks / Gillett can try to make an appointment to the board, or remove someone, but that is not ratified until the chairman signs off on it.

Also, given the value of the outstanding loans which are secured against the club, the value of the proposed deal looks bang on.

Its not a sure thing that this will go through, but I think it would take a pretty wild interpretation of the docs for it to fail.

BigJohn said...

Thanks Jamie for the insight. I had my hopes up for a wile ther. Listning to Broughton you would think it eas done and dusted. Fingers crosed the sale goes threw and we get rid of them two once and for all.
And hopefully they lose as much out of their own pockets as posible.

What do you think of the new potential new owners?

Jaimie Kanwar said...

The interpretation is not wrong.  Have you actually read the Articles of Association?  if not, then you're in no position to make that judgement.

It is NOT explicitly stated that ALL removals/additions be signed off by the Chairman; it states that the Chairman has an individual right to add/remove board members; no specific mention is made in reference to whether that power supercedes the rights of Hicks and Gillett, i.e. the owners.  That's the point. That's what will need to be decided.

Do you really think H+G would sign away ALL THEIR POWER?!  A Chairman appointed BY H+G suddenly has more power than them?  i think not.

They probably haggled for days over that provision, and deliberately held out for that particular wording as it's not as explicit as it needs to be.

alangky (Singapore) said...

Tks for the explanation Jaimie. Being a true  Red, I & I believe ALL True Reds will hope that the law case goes in Broughton's favor. 

Let's be rid of the 2 bastard Yanks forever !!! We are millions against only 2 of them - the IDIOTS of football.

Koy. said...

hey jamie... Great article... But it scares me to think of the other possibilities, We really hope the sale gones thru... hope for the best... either ways YNWA

Ken said...

It says:

"Any appointment or removal shall be made in writing and approved by the the current chairman"

Thats an explicit legal statement - and I can assure you the legal docs I work on are generally for far more substantial amounts than the amounts involved here. I'd be more than happy to advise counsel to go to court on the basis of it.

To switch the question - do you really think Broughton et al would have gone public if they weren't confident of an outcome?

Given that they've been allowed capitalise accruals on the outstanding loan, and that Broughton is a bank appointment, it makes logical sense that the appointment was put there to stop H + G from interferring with the sale process in return for the extension which was granted.

Jaimie Kanwar said...

I agree it's an explicit legal statement; however, that doesn't mean it can't be challenged, and that doesn't mean that it's only able to be interpreted in one way.  As I said in the article, I don't really think Hicks will win on that particular point, but there's always a slim possibility. Stranger things have happened.

Saj said...

After many articles which appeared to be pro Hicks and revelling in the role of devils advocat I feel your truly worries finally coming through here. Good, concise article.

Btw images not coming up even via safari on iPhone. Perhaps just put them up in italics in future, instead of images?

GAGA said...

I have to say the case in question is 50/50. I honestly believe after reading the wording, and i will stress i am no expert in the English language or law for that matter, it will all go down to how the judge on the day will interpret the law/evidence in question. In addition if there was to be an appeal which i bet there would be, the other judge may well rule in favour of H&G. We will then have to hope that H&G have failed to refinance the debts. LFC will cease to exist if this will be the case as the refinance will be placed against the players, stadium, grounds etc. This is one of the reasons why the board originally rejected the refinance by hicks.  

GAGA said...

Forgot to say, nice reading, thanks

Jaimie Kanwar said...

Also, I'm pretty sure that if Hicks fires Purslow and Ayre, they cease to be Directors.  At that point, Broughton has no say over their removal as he doesn't employ them.  Hicks can fire anyone who works for him, and he'll manufacture whatever reason he likes.  What's the worst that can happen? Purslow and Ayres sue him for unfair dismissal?  Pocket change compared to the loss he could make if the club is sold.

Jaimie Kanwar said...

That's a good point, GAGA.  Two different judges could interpret the clauses in two different ways.  That happens all the time. Friggin' inconsistent legal system!

pap133 said...

you make a good point jaimie,as others do also.But my guess the reason Hicks is pursuing this public is quite simple.H&G stand to lose 135 mil pounds.

King Kong said...

I think the onus of the directors is to obtain the best value for the company, by which the word 'value' is debatable as it can be tangible and intangible. I think the fact that this has become a big mess in UK football history, the court (hopefully) will make a 'popular' decision and make an 'example' out of H&G case to tell owners that they are in for a running should they think this industry is a cash cow - which is not.

delaynomo said...

A few comments:

Para 1:  If it's not an exclusive right, then whoever Broughton appoints/removes then Hicks could reverse and vice versa.  The logical outcome is no change to the board?

Para 2(i):  An alternate director is someone appointed to stand in when the principal director is unable to attentd a meeting.  You've got the wrong end of the stick.

Para 2(ii):  Special notice requires 14 days notice.  The fax to S&M did not give that?

Para 3:  Do you know for a fact that LFC are not party to any agreements entered into as part of refinancing deals?

Para 4:  The sale process has already been extensive.  Apparantly there were recently two competing bids.  The market price is the market price.

Morten Dam said...

I have to aggre with you that article 81 a) is very unclear regarding the authority of Broughton. To me the big question regarding the streght of MB's authority is interpretation of the last line. Does it meen that any removal from the board should be signed by MB to be legit or does it meen that when/if MB himself removes a board member he should sign for the removal.

2) Does MB have the power upon receiving the fax from G & H to effectively remove Mack Hicks and <span> Lori Kay McCutcheon while "resigning" Purslow and Ayre?
</span>

fraggs said...

An alternate is someone you appoint to act on your behalf when you're not there. So if Ayre was only a director acting on behalf of Hicks then Hicks could remove him but otherwise article 71 doesn't allow anyone to remove other directors from the board. It's simply stating the hopefully obvious notion that if you nominate someone to attend in your absence then that person doesn't get to keep your spot when you come back. That's not the case here, Ayre and Purslow are directors in their own right as detailed in article 70.   
Also, "Special Notice" is defined as 28 days notice required to be given before an intention to propose something at a general meeting. This specifically includes the notion of removing a director before his time in office is due to end. That's not to mention that it would just be a proposal. There is very little that can happen, especially at that level in the company, without board approval and a proper vote. To remove a member of the board would requite a majority vote at a meeting of at least 3 other board members. That hasn't happened here.  
The whole point of having a board of directors is that the owners must endure a process of checks and balances so they don't hastily act in a way that may be bad for the company. Sacking a Managing Director is not the kind of decision Gillett and Hicks would get to make, it would more than likely need to be voted on. Anyway, Ayre and Purslow are still in their positions are they not? They're still running the club as far as I can see. No doubt Hicks tried to knock them off the board but there is no information to date that says they've been removed entirely from the company. 

stig said...

I think a major point here is that if H&G has not found a source for refinancing then these procedings will make it even more impossible to do so within the RBS deadline. Who would agree to refinance before this case has been decided? It's check mate.

Derrickt said...

Thanx for the AOA article

Hicks Hater said...

You state that nowhere does it state that Broughton has the unique right to control who is on the board but you have just cited the section of the document that gives him that very right, It states that any removal or appointment shall be made in writing (did Hicks try to remove them in writing?) and then signed by the chairman (ie Broughton). Legally therefore Broughton MUST sanction any movement in or out of the board. So that totally refutes your argument.

You say if he sacks Puslow and Ayre then they would be removed from the board. But this begs two questions: did he actually try to sack them from the company or was it just from the board? The second question is do you actually need to be employed by the company to be a member of the board- I don't think you do, so sacking them from the company would not automatically remove them from the board.

So on the board issue Hicks has no leg to stand on. His argument can only focus on the 'reasonable' sale question. It may be true that Forbes estimate the value of the club higher than £300 million but the fact of the matter is that after several months of being on sale the best concrete offers that came in were for £300 million- since Hicks and Gillett are obliged to sell in order to pay back the loans they can't be too fussy on what they call reasonable. Given that everyone knows that they will lose the company on 15 October better offers are unlikely to come in now so in the circumstances it is a reasonable offer.

As for the argument that they are so aggressive in their approach because they may have already organised a refinancing package I doubt it very much. Otherwise they would have informed RBS and no one would be talking about 15 October deadline. I think it more likely that they are still desperately clinging to the idea that they might be able to do so but even this seems unlikely because it is obvious that their finances are built on dubious foundations and in a time of economic crisis the banks are less likely to be compliant with risky loans.  Don't forget RBS have placed Hicks and Gillett in a toxic debt category- that will do nothing for their credit rating.

In these legal questions, don't forget that earlier in the summer the board successfully resisted Hicks and Gillett's to refinance using the assets of the club as security. The owners were unable to challenge that so I am confident they won't be able to challenge this.

daboy said...

Jamie as far as i understand it if Broughton has seeked reasonable High court advice before proceding he must have the high ground.
In saying this H and G could twist things and make this a very complicated case to rule on, i for 1 am hoping the R.B.S have a little up their sleeve, 
as you would know banks contracts are usually watertight.
As far as H and G remaining in control of the club i find it highly unlikely!

Hicks Hater said...

You state that nowhere does it state that Broughton has the unique right to control who is on the board but you have just cited the section of the document that gives him that very right, It states that any removal or appointment shall be made in writing (did Hicks try to remove them in writing?) and then signed by the chairman (ie Broughton). Legally therefore Broughton MUST sanction any movement in or out of the board. So that totally refutes your argument.  
 
You say if he sacks Puslow and Ayre then they would be removed from the board. But this begs two questions: did he actually try to sack them from the company or was it just from the board? The second question is do you actually need to be employed by the company to be a member of the board- I don't think you do, so sacking them from the company would not automatically remove them from the board.  
 
So on the board issue Hicks has no leg to stand on. His argument can only focus on the 'reasonable' sale question. It may be true that Forbes estimate the value of the club higher than £300 million but the fact of the matter is that after several months of being on sale the best concrete offers that came in were for £300 million- since Hicks and Gillett are obliged to sell in order to pay back the loans they can't be too fussy on what they call reasonable. Given that everyone knows that they will lose the company on 15 October better offers are unlikely to come in now so in the circumstances it is a reasonable offer.  Don't forget that Kirdi stated just last week that he pulled out of the bidding process because the owners were being unreasonable in their asking price.
 
As for the argument that they are so aggressive in their approach because they may have already organised a refinancing package I doubt it very much. Otherwise they would have informed RBS and no one would be talking about 15 October deadline. I think it more likely that they are still desperately clinging to the idea that they might be able to do so but even this seems unlikely because it is obvious that their finances are built on dubious foundations and in a time of economic crisis the banks are less likely to be compliant with risky loans.  Don't forget RBS have placed Hicks and Gillett in a toxic debt category- that will do nothing for their credit rating.  
 
In these legal questions, don't forget that earlier in the summer the board successfully resisted Hicks and Gillett's to refinance using the assets of the club as security. The owners were unable to challenge that so I am confident they won't be able to challenge this.

Hicks Hater said...

It's not unclear at all- it says that all changes to the board must be made in writing and then signed by Broughton. How much clearer can you get?

reddieeddie said...

I think it was a great article and you should be thanked for giving us a genuine insight into the the core issues that will decide the outcome for all Liverpool fans. But I think Fraggs comment has hit the nail on the head. If Hicks could remove them from the board legally he wouldnt be bothered going to court to prevent the sale. Check mate is right!

Joe said...

I think the fact that there are no higher bids means that "reasonable" applies in this case. Not only that, but there is another bid of similar or lower value from the Asian group. Broughton said this in his interview yesterday, when referring to the reasonableness.

As for why Hicks might challenge this. It looks like he doesn't have a choice. Maybe he is hoping that by causing a delay NESV will up their offer. Or maybe he's hoping another player will enter the market in the intervening week.

I agree with Ken that the Chairman statement looks clear cut. As for any agreements with RBS affecting the legality of the sale. They must do. Otherwise Broughton wouldn't be on the board.

Hicks Hater said...

Hicks and Gillett had no choice but to sign this- otherwise their loan would not have been refinanced earlier in the year. Broughton is an appointment acting for the bank so RBS would have wanted to make sure that he had the power to fulfill his mission.

The more important point is that H + G could find no alternative financer back in the spring, otherwise they would have just changed banks and not accept such clauses. The fact that they had to accept this clause on Broughton's power rather than finding an alternative bank to finance them then shows how weak their position is. Their credit rating is even worse now given that RBS declared their loans toxic and LFC supporters have made it clear they will not tolerate continued H + G ownership.- add in also that the club is underperforming on the pitch under their leadership and you'll see that their chances of refinancing are worse now than in the spring. No one will refinance their loans at this stage.

Hmmm said...

JK
Purslow and Ayres do not work for Hicks. They work for the Liverpool Football Club. 

I think the key word is "approved" in the clause highlighted by Ken

TG said...

Hicks has to accept this deal as the RBS on the 15th October will sell to NESV for even less than £300m, this would be even worse for Hicks and cost him legal fee's too. I don't believe he will go to court and is hoping to get more money from NESV, The RBS and Liverpool have had the best legal advice all along!!!!!

Redcover said...

Jamie, As a former Company Secretary of a large UK plc with many years experience and who knows Nigel Boardman of Slaughter and May who is representing LFC, I believe ken's interpretation of the legal document is correct and that the court is more likely to come down in Broughton's and LFC's favour.   I believe Article 81a is absolutely clear.  If it was intended that Hicks and Gillett or any majority shareholder were to have powers to appoint and remove directors, this would have been clearly stated - it was not.

Having read the documents, I believe the odds are stacked against Hicks and Gillett and I look forward to a time when we return to stability at LFC.

Redcover

rick said...

SIGNED, SIGNED by the the Chairman, not simply APPROVED.
I don't know how it's structured UK's law, but in Italy "to put pen on paper" has a legal value.
Article 83, according to italian law, automatically introduce a legal commitiment in the whole document.
Is it not the same in UK?

Richard Davies said...

It is entirely logical that when the Bank refinanced they gave "consideration" and as a result H G had to agree to the undertakings (solemn  promises)
which were there to bolster the Bank's security.
The applications sought seek an "equitable" remedy.
<span>
<p>The maxims of equity evolved, in Latin and eventually translated into English, as the principles applied by courts of equity in deciding cases before them.<sup></sup><span>[</span>1<span>]</span>
</p><p>

</p></span>

Richard Davies said...

<p><span><span>·<span>        See </span></span></span><span>http://en.wikipedia.org/wiki/Maxims_of_equity</span>
</p><p>
</p><p><span>Now this is where HG fall down,</span><span></span>
</p><p><span>If they "breach" there promises and dispute them then if the Court finds the undertakings WERE given then under the legal dictrine of estoppel the Court will say well you gave the promise then you cannot now do otherwise.</span>
</p><p><span> </span>
</p><p><span>If </span>
</p>

Richard Davies said...

<p><span>If you look at the maxims of equity H G breach a few in my view.</span>
</p><p><span>If you breach the undertakings and deny they exist (arguably a lie) does HG really think the Court will grant them relief? To not do so would cause c £60m more in penalties and costs irredpective of the damage to the Club and "brand".</span>
</p><p><span>In considering whether the offer is reasonable the Board is entitled to look at the whole scenario its not just whether £300million is enough.</span>
</p><p><span> </span>
</p><p><span>Even if Broughton succeeds don't think it will be over as HG could and probably will persue litigation claiming losses and even if the case may be doomed to failure it will be costly and time consuming for all. </span>
</p><p><span> </span>
</p><p><span>In short I think Broughton will push through the sale with the above caveat.</span>
</p>

Ken Charmer said...

One nightmare scenario is that Hicks decides to use money from his own personal fortune to pay off the loan in a desperate attempt to save face and hope he can recover it and a higher value with an alternative sale. We don't know if he has the assets or would risk them . That would give him control and leave us all in limbo. Who would offer more than 300m given his track record. But it is the only way he can avoid losing some or all of  the 144m reported. Let's hope his assetts and other commitments don't allow him to 'irrationally' consider this strategy

kunalroy2712 said...

Ditto for me too... but thankfully a JK article where's he has supported opinions with hard facts =-X ... n not infuriated ppl!!!!! Can sum1 pls raise their hands n promise to service the club faithfully at least for the next 10 years!!!!

PH said...

The first place where your argument goes wrong is that in Art. 81 it clearly stipulates that any appointment or removalshallbe made in writting and signedby the Chairman.
Now it seems clear that MB has not sanctioned the removal or CP and IA and also not sanctioned the appointment of Hicks Jr. and his side-kick.  Therefore, it seems that the claimed removal and appointment by H&G has no validity. The Art. does make it obligatory for MB to sign another director's actions, but it is a prerequisit for the action to be valid that he does so.
Now, following that, an argument can of course be raised by Hicks if MB has actedi the interest of the company. In my mind, there is no doubt that it is in the interest of the company (maybe not in the interest of the shareholders) that LFC is sold before the deadline for the repayment of the loan with a view that there ca be no risk of points dedection.
Thus, apart from evidence that is not known, it seems to me that MB, CP and IA stand a good chance to win the legal challange by H&G.

Tornike said...

Very interesting article, always good to read facts, not rumours (especially having studied law in university). I think it is something like 60/40 that it will be interpreted the way we all want.

Deano said...

All u idiots engaging in Liverpool kop. It's irrelevant how accurate orninformative this article is. The guy behind the 'Jaimie kanwar' anogram is duff

Sam said...

Exactly- it is entirely clear. Any new appointments or removals must be signed off by the chairman....Martin Broughton. It is clear as day.

Nickname said...

I guess this is the last roll of the dice for Hicks, drawing out this process might buy him time, hell if i was about to lose 140m i think i would give everything a shot.

burkittmd said...

Excellent article. Since Wednesday I have been trying to find this information in the popular press. Most sources simply include their own conjecture without an evidence base. Not only have you given a cogent digest of the situation both in the boardroom at Liverpool and with regard to the likely court situation, but you have also given us the primary evidence to make our own opinions - perfect.

I am delighted to see the additional comments from Ken amongst others - surely with an explicit clause requiring the chairman's approval to reconstitute the board, and clear and public statements that the chair heartily disagrees with the H+G attempts we can't really expect the court to ignore this legally binding document.

Jaimie Kanwar said...

It is not clear as day - if it was, it would explicityly state that Broughton could overrule majority shareholders.  The clause leaves room for maneouver, and Hicks can (and probably will) try to exploit this.

Jaimie Kanwar said...

No - according to Hicks, Purslow and Ayres are gone.  In an email to BBC Five Live, Hicks said: "We have ­removed Christian Purslow and Ian Ayre"

http://news.bbc.co.uk/sport1/hi/football/teams/l/liverpool/9069040.stm

Jaimie Kanwar said...

No - according to Hicks, Purslow and Ayres are gone.  In an email to BBC Five Live, Hicks said: "We have ­removed Christian Purslow and Ian Ayre"

http://news.bbc.co.uk/sport1/hi/football/teams/l/liverpool/9069040.stm

Jaimie Kanwar said...

They've not found a source *that we know of*.  They do't have to reveal their source (if they have one) until deadline day.  There's also the possibility that H+G were planning to use their own money to pay off the loans. (either personal cash or more loans from Kop Cayman)

Jaimie Kanwar said...

Hicks clearly believes he has removed P+A freom the board legally.  He has no choice but to go to Court because Broughton has defied him.  IUt's not a case of Hicks saying 'I've removed them, that's it'.  The legality of his actions are under scrutiny, which is partly why the case is going to court.

Jaimie Kanwar said...

I agre with you that the court is likely to interpret s81 in LFC's favour  I state that at the end of the article.  it's not a foregone conclusion though.  I think the more pressing issue is whether Hicks has a legal right to sack Purslow and Ayres, and if so does that mean their places on the board - and consequent right to vote - are forefeit.

If so, the original vote will not be valid, and the deal will be dead.  If it hasn't happened already, a new vote will have to be held, and if Hicks has the majority then we all know how that will go down.

Additionally, Hicks may possibly challenge the legaility of s81 anyway, which basically removes his rights as an owner.  He may argue that he agreed the claus

fraggs said...

Majority shareholders don't run the company, the board does. That's also explicitly laid out in the document under "Powers Of Directors" on page 17. This is how companies with boards work. There is no provision anywhere in the document for shareholders to have any further say beyond simply being members of the board and getting their own vote. 

fraggs said...

Why would he think that so vehemently? Well first of all you don't know what he's thinking, you only know what he said. He's saying it because quite obviously it's his absolute very last chance. He's taking it to court because he has no other choice. It doesn't mean for a second he actually thinks he has a valid case. Seriously, what else is he going to do except take it to court? If he thought he was completely dead set wrong, wouldn't he still at the very least take it to court to try and argue it? The guy isn't just going to roll over and give up but that doesn't mean he's in any way legally correct. 
You're making some grand assumptions here in repeatedly saying that Hicks can "sack whoever he likes". If you're basing that assumption on the fact that he has tried to do so then I'm afraid that means nothing. He's a desperate man who is being forced into a sale that will lose him money. The document you yourself have posted states very clearly that the company is run by the board, it's pretty much the end of the story. You're holding on to some vague notion that surely the guys who have the most investment must have a bigger say in things. That might sound sensible to you but in this case it's just not true. RBS and Barclays forced G+H into this situation and it's laid out very clearly in the document. They don't have that power. 

Max said...

Great article Jaimie!!!

I would just like to find out the following though.

Lets look at the worst case and the court rules in favour of H&G which leaves RBS to send KOP Holdings into administration as it seems H&G are unlikely to get a loan to settle with RBS. But if H&G by some miracle do come up with the money will there be any chance of the EPL telling H&G to forget about taking control again?

Keep up the good work!!!

Matt said...

Just a thought, even if the written undertakings to RBS are not legally binding in terms of the sale of the club, would they not be legally binding in terms of the refinancing contract between Hicks and RBS?

Therefore, if that undertaking is broken by Hicks, wouldnt RBS be in the position to call in the loan immediately?

Matt said...

Just a thought, even if the written undertakings to RBS are not legally binding in terms of the sale of the club, would they not be legally binding in terms of the refinancing contract between Hicks and RBS?

Therefore, if that undertaking is broken by Hicks, wouldnt RBS be in the position to call in the loan immediately?

Kop said...

Jaimie, Purslow and Ayre make up 2 members of the five member board of directors, but Boughton has the power to remove members of the board after a successful majority vote by other directors, Hicks & Gillett cannot decide to remove two directors without the agreement of Boughton - they tried and Boughton rejected their hostile move, hence why Hicks actually hung up on the board during a conference call concerning the new bid!

Hicks is a moron Jaimie, you don't need to be a genius to be rich, he was from rich stock to begin with - George Bush Jnr for instance!?

You can speak to the Union of members from Texas Rangers, he tried everything to regain some kind of control but he was declined at every turn, that's why the change of ownership took so long as was eventually agreed in the high court.

As it turns out we ARE at risk of a 9 point deduction (following administration) as our controlling company is solely involved in the business of football, are you still content that you supported H&G through their disgraceful ownership reign?

To be honest Jaimie, you could have done A LOT more to support the fans and the Club throughout this shambles, but you chose to sit on the fence and at times you came across as a supporter of profiteering by H&G instead of behaving like a fan and condemning Hicks for his disgraceful behaviour.

Jaimie Kanwar said...

He's saying it because quite obviously it's his absolute very last chance. He's taking it to court because he has no other choice. It doesn't mean for a second he actually thinks he has a valid case. Seriously, what else is he going to do except take it to court?
In one breath you sday 'I don't know what he's thinking' then in the next you say the above, which is your opinion about...what he's thinking!  It's not 'quite obviously' his very last chance.  There is lots of case law interpreting the various Companies Acts, and I'm sure that will have been examined to find some kind of precedent. You make it sound like Hicks - a businessman of vast experience - is just bumbling into court for the hell of it.  Whilst that's a nice idea, reality dictates that it's not likely to be very accurate.
You're making some grand assumptions here in repeatedly saying that Hicks can "sack whoever he likes". If you're basing that assumption on the fact that he has tried to do so then I'm afraid that means nothing.<span>
</span>

It's not an assumption, it's a fact.  Hicks has stated that he has 'removed Purslow and Ayres', which suggests HE thinks he can sack whoever he likes.  It is not ME saying that, it is HIM.  His representative has also publicly stated that Hicks 'legally reconstituted the board', which again suggests that Hicks feels he has acted legally by sacking Purslow and Ayres.
You're holding on to some vague notion that surely the guys who have the most investment must have a bigger say in things. That might sound sensible to you but in this case it's just not true. RBS and Barclays forced G+H into this situation and it's laid out very clearly in the document. They don't have that power. <span></span>
No - again you misunderstand; I'm presenting what I believe Hicks will be thinking.  The events clearly show that Hicks believes he has a bigger say in things.  if he didn't, he wouldn't be 8acting* like it, would he?

Kop said...

For once Jaimie it would be nice to know what your personal view of Hicks actually is.

What we are witnessing is the last desperate acts of a desperate man, you're going to look very foolish Jaimie when this situation is resolved next week - Hicks has no legal right to reconstitute the board, the document gives the Chairman (Boughton) the final say on changes at board level after agreement from majority rule of the board of Directors, Hicks cannot remove Ayre and Purslow because he forgave that power when Boughton was appointed, it's sour grapes.

All he is trying to accomplish is a delay in the sale because he's likely to be lumbered with a £70m loss if the sale goes ahead at the current price, he's trying to delay the sale to give him room to bargain.

He will lose, it's just a matter of when.

Jaimie Kanwar said...

The club is not at risk of 9 point deduction!  Just because some newspaper says 'British lawyers not believe that the club may be docked 9 points' doesn't make it so.  It's speculation, pure and simple.  LFC is a solvent business, just like West Ham were.  They didn't get docked poits, and neither will Liverpool.

And I DID support the club throughout this situation - I provided a fair and reasoned approach to the Owners (i.e. part of the club); I looked at the finances fairly - I did NOT jump on the bandwagon and lie, exaggerate and manipulate the truth just to serve the anti-H=G agenda.  That to me is not being a fan.  To me, being a fan is about being fair, and acknowledging the truth, even if it goes against what you personally believe.

Jaimie Kanwar said...

Good point, Max.  Perhaps the 'fit and proper owner' test used by the Premier League, but I can't see how that's possibly considering that H+G are already the owners of the club, which suggests they are alreacdy fit and proper.

At no point during this process have H+G ceased to be owners of LFC.  Until the High Court decides on the sale, they are the owners. So, Kop Holdings goes into administration, unless and until the club is sold, they will remain Owners.  So, during that period, if they come up with money somehow, they will be able to pay off the loans.

And as pro-LFC as RBS seemingly are, in reality, they just want their money, and if Hicks and Gillett give it to them, they'll take it.

Jaimie Kanwar said...

Good point.  That depends on the nature of the agreements, and whether they are binding in this context.  let's hope so!

Kop said...

Actually Jaimie, you're wrong.

The controlling company of West Ham was ALSO involved in a varying degree of other businesses, that's how the escaped a points deduction.

If we were to go into administration, we WOULD be at risk of a points deduction because KOP Holdings is solely concerned with Liverpool Football Club, it's ONLY asset. That's why it's a risk, not a certainty, but a risk all the same.

I'm not talking about SoS or any other fan organisation, I'm talking about the dispicable way in which Hicks has behaved. You can spin it whatever way you like, Hicks is bad for Liverpool and when something is bad for you, cut it out.

"I looked at the finances fairly"

There's only one thing you should have been concerned with; the promise of no debts being weighted against the Club which is exactly what's happened. Jesus Christ, Hicks can't even act in accordance with the stipulants of a legal document! He's an arsehol Jaimie, plain and simple, sorry correction, he's now a desperate arsehole.

Max said...

Thanks for that Jaimie

I am positive though that Henry will be our new owner!!! Hopefully when I return to your site after next week we will see an article from you confirming that Henry will be able to take us back to where we should be!!!

LFC and its real fans will rise again, SOS though will eventually realise that they are nothing better than toilet paper they use...

Jaimie Kanwar said...

No, I am not wrong.  Any talk of a points deduction is obvious media sensationalism.  Just look at the articles stating it - they invariably say things like 'an insider' said, or ' british lawyers are claiming'.  Talk of a points deductions sells newspapers and increases hits; it's not going to happen.

All the blame will be shifted to Hicks and Gillet, and their holding company.  Additionally, members of West Ham's board LIES to the premier league, and they STILL avoided a points deduction:

The PL's report stated: "...Mr [Scott] Duxbury [now West Ham's deputy chief executive] on any view, misled Ms Purdon [Premier League company secretary]. Thirdly, Mr Aldridge misled Mr Scudamore."
Lying to the PL?! Liverpool has not done that.  The club is profitable and managed well (H+G aside); plus, it is an national treasure and major English institution.  Damaging LFC = damaging English football.
It's not going to happen.

Kop said...

It's not media sensationalism at all Jaimie, as an economist I can tell you it's a possible risk as our holding company has ONE asset, Liverpool Football Club. West Ham's ownership was different from our own as their holding company held several assets.

 IF we go into administration a points deduction is a possible risk, not definate, but possible.

Honestly Jaimie, what the hell has our status as a "national treasure" got to do with it? Could you imagine the backlash if Liverpool were treated any differently to Leeds for instance?! Don't be stupid, our status will have no impact on the Premier League's decision - it's the law of equality Jaimie, we can't be treated differently.

West Ham's board lying to the Premier League is a different scenario altogether, the decision not to dock points at West Ham was made due to several mitigating factors, one of which was what I've eluded to.

SocratesJohnson said...

Does anyone know the structure of the sale?  Personally, I don't but would imagine that the proposed transaction is the sale of shares in The Liverpool Football Club and Athletic Grounds Ltd, by its immediate parent company, Kop Football Limited to the proposed new buyer.

In this case, presumably, the correct Articles of Association to examine in order to determine the powers relating to the appointment and removal of directors (who can approve the sale of their Company's major asset, the LFCAC Ltd) are those of Kop Football Limited, rather than the ones of LFCAC Ltd.

If the articles of Kop Football Ltd reflect those of LFCAC Ltd then they could be interpreted as stating that, while the Chairman has the power to appoint directors, Kop Football Limited, holding a plurality of shares, still has the right to appoint directors (under general company law, rather than the articles).  

There may well be another document (an undertaking given by Kop Football Ltd/Kop Holdings Ltd) that only the chairman may appoint or remove directors. The drafting is not as clear as it might be.  The stuff on alternate directors is irrelevant here as this is just about appointing a temporary, stand-in director.

There is a definite limit of information which should preclude any conclusions from being drawn from these articles alone over the likely outcome of legal proceedings.  In order to properly ascertain who can do what on the board in such a complex corporate structure, you would need to see other ancillary documents such as bank guarantees, shareholder agreements, powers of attorney, etc. that may be floating around.

Naijared said...

Pretty good article JK,it helped guard/check levels of optimism as i have had reasons to be cautious since the onset of this matter. It's almost a 50-50 scenario now and i just hope that Broughton and the other guys can pull it off. It's going to have people waiting with bated breath, anticipating,hoping. May GOD help LFC, I am just hoping for the best for the club. We really do not need this opprobrium now. But as the saying goes "if you want something you have not had before, be prepared to do what you have not done before too". We may just have to go this way for the deliverance of LFC from the taskmasters. I pray GOD favors LFC.

Wilko said...

From the way that I see it Broughton had an obligation to do what was best for Kop Holdings Limited, not the shareholders or Liverpool FC.

If the RBS loan is not repaid or renewed next week Kop Holdings would be in default and in danger of losing its only asset, Liverpool FC, to RBS.  To gain control RBS would have to appoint an administrator (9 points down the toilet) and would then sell the asset to their preferred bidder, who could be anybody.

The chairman is not concerned how much investment the shareholders have put in, only that Kop Holdings should not trade while insolvent (this means being unable to pay debts as they fall due).  He was therefore obliged to accept this offer as there doesn't seem to be any chance of the loan being renewed.

We haven't actually heard how much G&H have taken out of the club in terms of fees, expenses etc. or if the club paid any of the advisory or bank fees due on the original investment.  It would be interesting to see that figure compared with the £140m that they claim to be losing.

Jaimie Kanwar said...

test post

Ziyaad said...

Great article Jamie.  I must say that I dont usually agree with with many of your views and think that you sometimes go a bit over the top in trying to justify your particular stance.

However, hats off to you on this one.  I am a solicitor and agree completely with your interpretation of the relevant clauses.  Unfortunately, legal documents are often drafted so as to allow differences in interpretation.  So while I, too, hope that the court rules in Broughton's favour, this is not a certainty.

I do, however, disagree on your interpretation of the potential 9 point penalty, as I believe this too is subject to interpretation.  Lets hope it never gets this far, but since Liverpool is the only asset of Kop Holdings, the argument can be made in favour of administration.  Should it go this way, there will doubtless be an appeal from Liverpool, and should it not, you can be sure there will be a host of premier league clubs who will challenge the League's interpretation not to dock the 9 points.

If Hicks does win the legal battle, much depends on RBS and their views on the matter, and there is no clear indication whether they will call in the debts, grant an extension (either a longer one, which Hicks would favour, or a short one to allow the legal issues to be settled). 

I agree completely with you in supporting Purslow and Ayre - they have the club at heart and I never quite understood all the negative sentiment against them.  Broughton, whilst a chelsea fan, is a smart business man - and has hinted that he has a plan b should he lose out in court.

Fingers crossed then that come the derby next week, hicks and gillett will be gone for good.

fraggs said...

Jamie, everything Hicks has done has indicated that he WANTS to be right, not that he actually believes it. He could very well think he has barely a 1% of winning in court, wouldn't he still do exactly the same thing? Are you saying that if he doesn't think he's a chance of winning that he'd just walk away? Vehement opposition and strong statements to the press really don't mean he thinks he's right, they're just the most obvious course of action. Seriously, what do you think he would be doing if he didn't think he had a good chance in court?

fraggs said...

He clearly believes it because ... he tried to do it and made a statement to the press? Do you think that if he didn't believe he was successful he would do something else? Make a nice apology to everyone and wish the new owners good luck?

fraggs said...

They are over 200 million pounds in debt. That's why they are not fit and proper.  

BigJohn said...

What happens if the appeal is after the 15th?

Jaimie Kanwar said...

test post

Gary said...

No offence JK but this article is written by someone who lacks full understanding of company law.

A few things come to mind.

H&G are major shareholders so they own the club but that doesn't mean they can just sack a board member at the drop of a hat i.e 15 minutes before a meeting is due to convene. The business activity of the company is overseen by the board. Broughton is the Chairman which means he has overall control of over the matters of the board. To remove Purslow and Ayre from the board would require Broughton's written consent as stated in Article 81. An attempt by H&G to remove Purslow and Ayre 15 minutes before a meeting would be seen as unreasonable/illegal as special notice is required when trying to remove a director.

You have misinterpreted the meaning of alternate directors. An alternate director acts as a proxy, i.e in place of a director who is unable to attend a board meeting. For example if Hicks was unable to attend a meeting he would appoint someone as an alternate director in his place and they would have the right to vote in Hicks' place; this could be another board member who would then get two votes or somebody else approved by thr remaining board members. It doesn't mean, as you think, that H&G can replace anybody on the board.

<span>Section 168 of the Companies Act states the law for removing an existing director, and it clearly states that special notice must be provided. Special notice is 28 days. So for H&G to send a fax 15 minutues before a meeting sacking Purslow and Ayre would be seen as unreasonable.</span>

<p><span>“There is no immediate legal bar preventing Hicks from sacking Purslow and Ayres. He could even argue gross misconduct – Ayres and Purslow will have employment contracts, and they’ve clearly been working against Hicks; defying his wishes in such a manner could be deemed to be gross misconduct”</span>
</p><p><span> </span>
</p><p><span>There is in this situation. </span><span>Section 172 of the Companies Act state that directors act “in the way he considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole”. So on the basis that Kop Holdings is close to administration the duties owed to the company under section 172 become duties owed to the creditors. The interest of the creditors would prevail. So at this stage the board’s legal obligation is to make sure the creditors are repaid. The fact that H&G make a loss does not alter the board’s duty. On this basis alone it is likely that the sale of </span><span>Liverpool</span><span> to NESV will go through. </span>
</p><p><span></span>
</p><p><span></span>
</p>

The Roy Hodgson Brigade said...

Great read Jaimie...

Hicks is going to all extremes to try and save his ass but to me he is walking into a brick wall, taking a step back and walking into it again and repeating the procedure over and over again.

October is the month were H&G will be no longer and Henry will be the saviour!

YNWA!!!

Phil Eel said...

Jamie

Article 83 makes it clear that a Director can be removed (inter alia) only in accordance with the provisions of article 81 which does make it clear that only the chairman can appoint / replace directors

Phil Eel said...

Further, under s303 of the Companies Act 1985, sacking a director requires a simple resolution of the Board - IE a majority and it is clear that regardless of Article 81 and 83, Hicks and Gillett could not muster that majority. I think we're fine.

Dean H said...

Fantastic article.  I'm no novice when it comes to law, but the whole point, or indeed spirit of law is justice and fairness.  To this end, it pains me to say it, but I just do not see how the board can manipulate a situation to the extent that owners can have thier property sold from under them without thier consent, for less money (in principle) than has already been turned down.

It's a private business.  The amount of money G&H stand to lose make it worthwhile bringing another partner in, or selling off other chunk of thier estate.  These are businessmen - they were always in in for the money, unlike Roman or the Sheik.  If British law upholds this nonsense it will be a bad day for the British economy in terms of foreign investment.

Oh yes, I'm a Liverpool supporter from London who regularly visits Anfield.

Phil Eel said...

s168 of the 1986 act confirms that you need a resolution of the Board. Hicks / Gillett cannot sack Ayres and Puirslow, could not have mustered a majority and thus could not remove them by simple majority of the board.

Jaimie Kanwar said...

Cheers Phil.  If I had more time I would've included lots of other supporting evidence, but the article has to end somewhere!

I understand what you're saying re the statutory law, but we don't know how that has been interpreted by the courts in practice.  The case law on the subject that I've read so far shows that the Companies Act is not always interpreted in a black and white manner (like most laws).  There are always loopholes to exploit, and whilst I don't think s81 will fail, the fact remains it can be challenged.

Phil Eel said...

Thanks Jamie

I'm a non practising le awyer and I know what you mean about interpretation by the Courts but as far as my legal knowledge is concerned, this look pretty good for us, both under the Act and the Articles.


....or am I just hoping beyond hope ????

Gary said...

JK I accidentally deleted my post. Can you put it back on.

delaynomo said...

The events clearly show that Hicks believes he has a bigger say in things.  if he didn't, he wouldn't be 8acting* like it, would he?

Completely wrong.  If you are going to fight something like this (and given the amounts involved, there is no way Hicks would ever go peacefully), the very FIRST step is to claim you are right!  Of course Hicks sends a fax sacking Purslow and Ayres.  Even if the fax is invalid, at the very least it muddys the waters and delays things while Hicks prepares his defence (think of it as a professional foul in midfield ;) ).

Middxile said...

Happy as we all may be if H+G lose their case and go, are we all that comfortable with John Henry?  I believe that he will borrow money against the (currently) debt free Boston Red Sox, pay off the RBS loan,re-furbish Anfield to incorporate more Corporate facilities and buy a couple of players. He will then plunder Liverpool's cash rich revenue streams (with impunity) to pay off the debt on the Red Sox, and draw such dividends for himself as he sees fit. We are going down EXACTLY the same route again !

Jaimie Kanwar said...

I think you're right - things look pretty good.  Let's just hope we get a fair-minded judge.  if we get a battle-hardened, business-aware warhorse who hates football 9and is a Man United fan) we may be in trouble ;)

Brian - Ormskirk said...

Jaimie, you have just ruined my bloody week-end! A very, very good article which gives the pros and cons for both parties. (Bet you now get a load of garbage saying that it just shows that you favoured Hicks all along). I'd say that the odds of our winning are no better than 60/40. Thank God the hearing is in the UK and not in front of an anglophobic,Obama supporting, Yankee judge. Somebodies credibilty is going to go down the pan, and I sincerely hope that it is Hicks. Would the loss of 9 points, if it comes to that, be such a great loss if we finally get rid of the two present owners. Can't say that I am jumping through hoops at the thought of the club still being run by Americans, but at least the credentials of NESV seem to tick all the right boxes. 

Chris said...

It'll depend on what RBS decides to do, they'll likely delay any action until after the legal issue is sorted out but whatever happens on that front I think they'll look towards getting the club sold since they have a bidder here who'll get them their money back.

The Roy Hodgson Brigade said...

Dean H

I can agree that H&G are sort of being shafted up the bum but they need to realise that this is the end for them. What they do not want to understand is that LFC will prevail. Nobody is better than the club and those who hold us in their hands, the board, the court and EPL will acknowledge and send H&G packing.

The Roy Hodgson Brigade said...

Go to hell and stay there. it is exactly where you belong...

numbnuts said...

it makes no odds if hicks wins in court - he wont own liverpool fc on saturday - we might lose 9 points but losing 90 points is worth getting rid of the parasites. isnt that right alan

The Roy Hodgson Brigade said...

We are not going to loose 9 points...  
 
Please QUOTE the EPL where they have claimed that we will loose 9 points if KOP HOLDINGS go into administration.  
 
The media sell shit to make money you idiot, when will everyone who believes the media understand this?

The Roy Hodgson Brigade said...

Let me just remind the idiots...

KOP HOLDINGS (H&G) will be put into administration...

LIVERPOOL FOOTBALL CLUB will remain solvent...

EPL rules, only a club that is found insolvent will be will be deducted 9 points which won't pertain to LFC.

If that is not clear enough for you idiots than keep on believing what the media says and eat your words when you once again will be proven wrong :-D

Chris said...

I completely agree.
Great bit of journalism Jamie...now if only you could apply that to understanding the briliance of Rafa! ;0

kopite said...

dear alan myers how much are they paying you

Imran said...

Jaimie,
Article 81 is clear cut. No appointments/removals without the express written authority of the chairman - MB.
Since he did not give that authority in the attempted removal of IA and CP then article 71 is automatically negated - in particular clause c backs up MB as he holds the majority vote together with IA & CP. This gives MB the casting vote as he rightly said.
Hicks is a desperate man and it makes it even harder for him since GG is not on board with him.
I for once have every confidence of MB and know his track record well, he knows what he is talking about.

Jonesy said...

What puzzles me with this is the timing of it all.  Why didn't the new bidders leave it until last minute e.g. Oct 15th) to make their bid?   That would have reduced Hicks time to try and ruin the sale.  Why allow this 8-9 day gap of uncertainty?    

Terry McCase said...

It´s no point discussing what will happen, the court will decide and that´s that. Noone can do anything until then. Everybody of course hope for a decision that will free LFC. In the meantime, why can´t everyone spell Ian Ayre´s name rigtht. All in line with common courtesy. I am pretty sure it is Ayre, not Ayres. How about it Kanwars?

The Roy Hodgson Brigade said...

We didnt know about any bidder because idiots like SOS and the media would have ended any bid before it even started. I can bet all my money that Henry's bid has already gone through even before the board announced it. All that matters now is telling Hicks that he has lost the battle... 

The Roy Hodgson Brigade said...

Obviously, you have nothing constructive to say so go visist SOS where you can go and agree with everyone. 

Warren said...

"Any appointment shall be made in writing and signed by the chairman."

So, he obviously didn't sign... Maybe that's what gives him the sole power... Just a thought.

Bob said...

They are a busted flush, I think you may have loaned cash to H & G and you defend them in the hope that you recover your investment.

ronan said...

Jaimie, an alternate director is a person who is appointed to attend a board meeting on behalf of the director of a <span>company</span> where that principal director would be otherwise unable to attend. Ayres and Purslow are full directors and not alternates. The articles of the company as amended by special resolution earlier this year are quiet clear in relation to the appointments and removal of directors. This power has been given to the chairman and him alone.

Hicks and Gillett acted in breach of the articles of the company and i'd also imagine in breach of the companies acts. Any court will take one look at the articles or rules of the company and agree that Martin Broughton acted correctly.

growler said...

another, scarier option, is that he is happy to go into adminsitration, and has a mate (george bush?) who will pick it up for him on the cheap, clear of debt. Then, proceed to sell the assets, and screw the club as 'revenge'

Charlie said...

They've not found a source *that we know of*.  They do't have to reveal their source (if they have one) until deadline day.  There's also the possibility that H+G were planning to use their own money to pay off the loans. (either personal cash or more loans from Kop Cayman)
sorry to quote Jamie, but if theyve got a potential refinance in place then theyre cutting it a bit fine me ol mucker.  I think you should leave it at that, your right that court cases can go either way for the most unreasonable decisions, however i think some of your reasoning hasnt been portrayed very eloquently.   <span></span>

m kop said...

I've read this and the situation is, I think, that Brougthon can replace alternative board membars.
 If Hicks and Gillet didn't need to accept this than they wouldn't, would they?

 Hicks was maybe able to get another loan from someone alse, or find someone to co-invest, or someone to get control and in return make them walk away without a loss...
  
        But if Hick loses in court it is it for them.

It wories me that there wasn't more credible investors trying to take control, from middle-east for example. Where was the family from Kuwait or Saudi prince for example?

  These new owners -NESV will very likely try to earn  from the club - (there is talk that they want to expan Ainfield rather than to build new stadium, who is to pay for it, them or the club?).

Even if it is reasanable for the club to take care of it's own finances, still we would want for new owner to invest some of his own money in transfer market and in the stadium.
   Maybe it's greed from us fans "wanting more" but the reality is that others have more. City is coming close to be force in PL, which they never were, and Chelsea is perfect example how owner can make his club a global brand.

Arsenal works like that, within their means (Reds Sox are like that as I understud), they dont spend a lot on players contracts, dont give long contracts to older players, and their players leave the club for a bigger contract (Cole, Adebayor) or becouse they are not winning things, and that is one of the reasons why they are not winning!

Liverpool dosn't have Wenger to keep the club in the top 4, or you still think Hodgson is English Wenger?

jane said...

Hello jamie.

Have read alot of your articles and to be honest don't really agree with much of them but thank you for this one.  I do believe this is hicks "double or quits" moment.  If it suceeds he hopes to make double what be bought the club for and if not there's no-where else to go.  However, from my non-legal, just reading it as it is it seems to me that the case is clearly in MB's favour however interpretation is such a very fickle beast.  All I can hope for this that the courts see it MB's way.

(PS. again for a non legal perspective I doubt very much MB would have brought it out in public if there was much chance of him losing wheras Hicks has nothing to lose.  I personally do think (and hope) that this will be the end of the twat that is hicks)

Ken said...

Stick to journalism.  No one ever can guarantee what a court will do.  But Broughton's confidence is justified.  The whole point of the change in the articles is to stop H & G from doing exactly this.  And the undertaking, said to not be legally enforceable, will estop them from taking a contrary position.  Context counts.

Ken said...

Brian, don't despair.  Jaimie has raised the arguments, it is true.  But they won't make sense to a court in the circumstances.  The purported appointments aren't proper "alternate" directors.  If Hicks had a leg to stand on do you think he would wait until 15 minutes before the meeting to pull this stunt.  Talks have been ongoing for some time, and he is a good enough operator to have done this weeks ago, on the basis that he could do better for the club......blah, blah, blah..... then get to 15 minutes before.  Desparate and shameful.  And no merit.

Ken said...

Jamie. It is wrong. (by the way there are two Ken's on here).  Broughton wouldn't have taken the job without that power.  They needed him for credibility etc. etc.  To say it is wrong is not to say the result is guaranteed.  That is very rare.  But listen to what Broughton has said and the initiative he has taken.  He is no fool.  He would not have said what he has said unless he was backed by a strong legal opinion.  And he has very strong advice.  One can always find something in words to quibble with.  But the notion of the change to the articles and undertaking is obviously for this very purpose and a court will give it that meaning.  Hicks won't succeed in holding up a unique provision like this to a mirror and saying, I really didn't mean that.   

Paul Bishop said...

ye but didnt they sign an legal binding contract that they wud noot put any loans against the club and thats exactly what they av dun there must b a legal way of stopping them from eva obtaining lfc in the first place

Jaimie Kanwar said...

Yes, I want my money back! 8-)

Bob said...

This is from the mouth of Broughton "This is all part of why it is important that we made the decision on Tuesday to accept one or the other of the two very acceptable bids. Heading for administration was a very likely outcome if we didn’t.
“Even now with the court case looming, administration cannot be ruled out. It is not inevitable, and I am not going to start giving percentages of how much it is possible. That is why we are going to court to clarify our position on the sale of the club, and we have to win in court, and we will win in court.”
“Going into administration needs to be avoided at all costs, as the negative impact would be catastrophic,” he said."

kopite said...

i think tom and jerry are trying to pinch a bit of cash by settling out of court - nuisance money, what do you think alan, sorry jamie

Shaun said...

Jamie, what percentage would you give that Broughton, Purslow and Ayre will win in court? Your opinion

Thanks

kunalroy2712 said...

Err Jamie, I know I haven't agreed to most of ur views, but hopfulyy on acoount of beinf LFC supporters, what do you think of the option of LFC being restructured as a PLC?

footix2 said...

Directors are not employees, the are company executives and completely different legal entities to an employee.

Also AoAs are legally binding. There is a statutory minimum of what can be in them, but you can effectively add any clause at all to the AoA providing it is not against the law.

You have clearly been reading company law for dummies judging by this uninformed an wholly inaccurate article.

Anurag said...

I have one simple question, why did hicks not fire Purslow and Ayre before. He could have fired them before, taken the majority refinanced the loan at say some 50 % Interest and retained the ownership! 

Why did he have to go down to the hour before the deal was to be closed ?

Makes sense ? 

Anurag said...

I have 1 simple question - why did he not fire them before? Purslow and Ayre were always a problem for Hicks, they voted against the refinancing.

Hicks could have easily sacked them, refinanced the loan at say 50 % and retained the control over the club.

why did he have to go down to the hour before the deal was about to be finalized?

Makes senase?

Jaimie Kanwar said...

Hi Shaun,

I think there's a 70-80% chance of win in court. Having saisd that, the judge won't care about all the views of fans, or how fans hate Hicks and Gillett; none of that will matter.  All he/she will look at are the facts, and the legal/business side of things.  Hicks could make a case, even if biased fans don't think so.

jasper from norway said...

i hope you go bankrupt

Rocket said...

"Any appointment or removal shall be made in writing and signed by the then chairman"

reads to me that this clause is a requirement for appointments / removals to be made in writing and the rest is an INSTRUCTION (not a discretionary approval) for the chairman to sign the removal.  H&G as directors made a written removal of P&A and Broughton is then forced by the AoA to sign it.

Rocket said...

"any appointment or removal shall be made in writing and signed by the then current chairman"

There was a faxed removal wasn't there?  The last part of that clause reads to me as an INSTRUCTION to the chairman to rubberstamp the removal once made in writing, rather than providing a discretionary power of approval to the chairman. 

Will said...

Fingers crossed, Hicks and Gillette keep in control and take the Heysels down down down...

Mainstander said...

What happens with article 70 that says there shall be no less than 6 directors ? Is every meeting the board has had invalid ?

Jaimie Kanwar said...

Totally agree, Rocket - that's why I've argued that Article 81 is not as clear as it could be.  There's definitely ambiguity there.

Mainstander said...

Article 70 states there should be a minimum of 6 directors. Does that invalidate every board meeting as there is only 5 ?

Jaimie Kanwar said...

Great point - When I was putting the article together I thought about that but dismissed it as I couldn't imagine that LFC could be so negligent, and basically downright stupid!  There must be some other rule somewhere that supercedes that one.  Otherwise you're right, it would surely make all votes invalid.

I'll look into that today and see if I can shed more light on that particular provision.

Jaimie Kanwar said...

Reading it again, Article 70 begins: "Unless otherwise determined by the chairman, so I guess that must mean that Broughton has stipulated that there only be 5 members of the board.  If that's the case, he would have to produce written proof that this is the case.  If he can't, then article 70 would probably come into force.  Let's hope he did the right thing!  How embarrassing would it be if Broughton failed to do it properly....

Rocket said...

Also, this would surely require a change in the AoA to reflect a five man board. If correct procedure had been followed then the AoA would reflect this change - are these the most up to date Articles?

Article 70 defines the number required to be on the board.  Article 91 defines the number of directors required to be present at a meeting for a quorum to be formed.

Article 70 states that the number on the board shall be 6 but article 91 states that a quorum of 4 (majority of 6) is required for the director's proceedings to be valid.  If the required number of directors on the board has been lowered to 5 then article 91 would require a quorum of 3 (majority of 5).

Dan said...

I am an attorney in the US and know nothing of law in the UK, but here are my meager thoughts:

The Articles of Liverpool FC are not relevant to the issue.  The sale of Liverpool FC was considered by the board of the holding company.  What do the the Articles of the holding company say about the appointment and removal of directors?

If they are silent on the issue, the matter may depend upon the covenants undertaken by Hicks and Gilette in the agreement with RBS in which Liverpool FC and its board members would be considered third party beneficiaries.

A further issue might be whether specific performance of those undertakings, i.e. enjoining Hicks and Gilette from removing board members, would be an appropriate remedy for any breach of contracct by Hicks and Gilette.  Frankly, i don't see any other remedy.  The bank already had the right to foreclose and hence monetary damages aren't applicable to the breach.  On the other hand, perhaps there is something in the Companies Act that does not permit limitations on the right of the owners to appoint the board without a change in the Articles of the Corporation?

Hopefully, RBS was well advised at the time they entered into the extension.

Magic Circle solicitor said...

Ken (regarding the removel point) - you are wrong. I qualified as a solicitor in corporate law in a Magic Circle firm and the point you make is incorrect.

You say that you look at documents like this daily but on a much higher value basis, great. Well do you actually have any training in company law? I am a bit of an oldie and work on the old section numbers, but the old s303 CA 1985 entrenched the right to appoint and remove directors in the shareholders by majority vote. There was no way to feter this and there is a ton of case law affirming that principle.

The Articles merely add extra layers of constitution onto the company's mandatory statutory framework.

It is possible to attach a greater weighting to certain classes of shares (a principle I think was borne out in a case called Bushell and Faith or something), but in terms of straight contract, you can't since it is a proprietary right attached to the shares. This is basic UK company law principle.

However, you may be able to argue that there is breach of contract if there are any undertakings stating that such removal will not take place.

Equally, the right to sell or buy one's shares is entrenched and subject to a similar breach of contract.

One further thing which I don't understand and which is not clear from the press or Articles above is this. If RBS have a security over the opco shares, then exercising the mortgage and taking posession does not constitute adminstration and hence we shoudn't receive a penalty; presumably however, the league takes a substance over form view and views an acceleration of debt as the same as adminstration and deducts points nonetheless.

Anyway, worrying times ahead, Boardman's got his work cut out, but we, the club, will survive it. The main thing is to get rid of G&H as soon as possible.

YNWA

nogood said...

No shareholder would hand over the rights to their business to someone underneath them. It's silly people are assuming that all of a sudden Hicks has no control. I can see disappointment only ahead for Liverpool.

nogoo said...

I feel sorry for Liverpool FC. The club is no longer what it once was and fans need to start acknowledging that. Mid-table would be a good season for them with what has gone on. Although you do have to question the players attitudes on the pitch which has nothin to do with the off-pich saga.

new_guy said...

 I don't see it the way you do at all. The statement in fact reads more like  CHAIRMAN SHALL APPROVE ANY APPOINTMENT.  If anything the statement seem to suggest, that Chairman has no choice but to sign and approve.  The spirit of bulk of the article  seem allow directors to remove anyone (except G&H); so the last part about "chairman SHALL approve " is more like saying that the Chairman has to approve, and this meaning  seem to be mor in tune with the spirit of the  rest of the article.

I think this is a simple close and shut case (in favpour of G&H), and the dislike (undersatdble) of G&H seem to have an effect on lot of people, and they  want to twist what appears clear into something favourable to chairman's stand.

I think all of this court business, and Broughton going to media, is PR stunt,  so that if Pool suffers  9 point deduction or other negative consquences,G&H take the entire balme; Broughton and RBS can claim they tried and come out as good guys.

new_guy said...

I am still puzzled; As far as I know Broughton is taking the case to the court.  I could be wrong on this cause there has been little information.
From what little (regarding the court dates etc.) it seem that Broughton is in contact with the court. Obviously in the end both parties wiol have to present their cases.
I still think Broughton is not relying so much on article this or article that, but simply laying the groundwork for next week, tie up G&H to prevent them from negotiating on some extnsion, or finidn another lender; and prevent any bad PR should Pool go on administration.

I think MB and RBS are planning to win the war; and this court case   who own power etc is a phoney battle to take  G&H 's attention and resource away from  their real battle, which is finding a lender and meeting the deadline.

paulg123 said...

to be honest i've only managed to read the most recent postings on this topic so apologise if this has been covered . something seems strange that everyone seems to be overlooking , gillette was an equal shareholder with hicks ! now we hear he has defaulted on his debt so presumably his shares (the equal power that hicks is weilding)has passed to his creditors no doubt a financial institution well versed in this type of law , yet we hear nothing from them . As i understand it the sale to NESV will pay of aquisition debt ( RBS and WAICHACO  ? sorry for spelling) but nothing for shares that's why hicks is pissed , so presumably gillettes creditors are about to lose to tune of 75 mil and they say nothing ?

Magic Circle solicitor said...

Dan

Good points - however, I think that the Articles of the holdco will be the same as for the opco for the relevant provisions; I believe the board structure is the same at both levels and this is often the case in the UK where the holdco is a non-operating company, pure holdco.

Specific performance in the UK would only be relevant where undertakings required G&H to do something and they hadn't. In this case, i.e. preventing them exercising their right to remove directors, estoppel would be more appropriate but there are issues with showing this.

On the limitation point, in the UK the right to appoint and remove directors is entrenched as a shareholder power and cannot be fettered or contracted out of - this is clear cut (see my post above) although in certain circumstances weighting of voting can be allocated differently amongst different classes of shares.

I agree it seems odd RBS would have entered into the refinancing without proper protection, but these undertakings may have been mere comfort that G&H would not frustrate a reasonable sale - much like the concept of a highly confident letter for financing / underwriting. These have no legal grounding and are by nature unenforceable but go some way to providing a counterparty with assurance as to future conduct.

I suspect this will be resolved either today or tomorrow though before the hearing; the value of the club will be vastly diminished if adminstration were to happen and this would prejudice G&H further. They have just been buying time to try and secure a refi package

Rocket said...

Given that RBS took out an injunction to prevent H&G from making further changes at LFC


( http://news.yahoo.com/s/ap/20101011/ap_on_sp_so_ne/soc_liverpool_ownership_1)


surely this suggests that H&G HAVE got the power to make changes?

Dan said...

Magic C----

I have some bad news and a question for you.  I looked for the articles of the holding company.  I didn't see them, but I saw two sites where people claimed to have viewed the articles of the holding company and said they were NOT changed.  Thats being the case, coupled with your citations to authority holding that the power of shareholders to change the board is essentially sacrosanct, it would seem that Hicks and Gilette HAD the power to change the board.

My question is what does the case law tell you about the remedy for breach of contract?  I would think that the contractual provision with RBS that prevents Hicks and Gillete from changing the board would be void.  However, wouldn't a provision that prohibits them from blocking a reasonable sale be enforceable?  By voting against the sale, they rejected the best bid the club could garner after a six-month solicitation for bids.  Given the pending insolvency, this best offer strikes me as a "reasonable sale."

Dan said...

It's nearly impossible for me to research UK law here in the states but Russell v. Northern Bank Development Corp. Ltd [1992] 1 W.L.R. 588;. [1992] B.C.L.C. 1016 (H.L.) may be a helpful case in answering my question.  Also, I may have been hasty in saying the prohibition on changing directors is void.  See the following general discussion starting at page 146: http://books.google.com/books?id=V_SvEEE1of4C&pg=PA146&lpg=PA146&dq=russell+northern+bank+development&source=bl&ots=u7ES_OzxRp&sig=yTh9Tt9HVIs-KhO_VA7N9auALds&hl=en&ei=IFWzTLmuG4iisQP6y42-AQ&sa=X&oi=book_result&ct=result&resnum=3&ved=0CBgQ6AEwAjgK#v=onepage&q=russell%20northern%20bank%20development&f=false

Dan said...

This merely means that Broughton is taking the steps he said he would take to have the courts to validate the board's decision. 

Again, I am an only a US lawyer, but our system is based upon yours and I would think the process in the UK is similar.  Here, you first file ex parte (ie without briefing from the opposing party) for a temporary retraining order.  You must show that there is an impending harm and some likelihood of success on the merits.  It is a low standard of proof and only valid until there is a hearing.  I think this is what happened Friday.  You then have a hearing in which you seek a preliminary injunction.  At the hearing the opposing party has the opportunity to argue.  This is what is scheduled for tomorrow.  Because of the exigencies in obtaining rulings over such a short period of time, the preliminary injunction is only valid for a certain period of time.  Another hearing is held to see if the preliminary injuction should be made permanent.

Jaimie Kanwar said...

Hi Dan- re articles for the holding companies:

For both Kop Football and Kop Holdings, the AoA were last updated in February 2008. I'm sure the AoA for LFCAGL is supposed to cover all three companies, not just LFCAGL.  We can infer this also from RBS' statement earlier today:

“...Those undertakings provided for the appointment of Mr Broughton as chairman of the board and the appointment of the chief executive and commercial director of LFC to the Kop boards.

Kop Boards (plural).  This must mean that the AoA for LFCAGL apply to KFL and KFHL.

Dan said...

At the risk of continuing a discussion with myself, the more I read the case law, the more I think we (I mean Broughton and his other board members) will win.  A company can't change inherent powers of the owners by changing the articles, but the owners can bind themselves through contracts among themselves and with third parties.  According to RBS, the undertakings were by Hicks and Gilette personally and restricted their activities with respect to all the holding comapanies.  This looks like a simple breach of contract case and I think that the Court will enjoin the owners from interfering with the sale.

Magic Circle solicitor said...

Yes agreed - in terms of limiting the power of shareholders to remove or appoint directors, the case law is fairly clear cut. Such power cannot be limited, so the undertakings will fail on this basis.

However, B&P will try and argue that by exercising those powers G&H are in breach of contracts given to RBS. However, this only gets you so far; i.e. it only gets you to the point where you can argue for estoppel against the removal of B&P at best, it does nothing in respect of forcing G&H to accept any offers for the club whatsoever.

This is actually a very interesting case and I'm sure it will become part of company law academics for the future, since it touches on so many fundmental points.

I hope they have a stronger argument than is reported however, as the English courts are loathe to set precedents in this sort of area and although we may win on the estoppel / removal point, forcing a sale I fear is nigh on impossible. I doubt the court will want to impact upon the proprietary rights attached to shares.

Rocket said...

OK, I understand you point that it is merely a 'routine precaution' (at the risk of putting words in your mouth) but neverthless it is an implicit acknowledgement that H&G have the power to cause harm i.e are in control.  Otherwise there is no need to take the precaution surely?

Jody Daniels said...

Jaimie, you're quite good at investigating these stories. And yes, you do have strong opinions about the owners, SOS and other matters concerning Liverpool FCas do most LFC fans. My question is this, have you looked into NESV's offer?

its probably likely that the injunction will be overturned, and that finally LFC directors will be allowed to proceed with selling the club, but is NESV the best option for LFC going forward? As compared to other bids, most notably the Singaporean businessman who has "allegedly" increased his offer and have "alledgedly" not received any response from LFC directors.

All the drama off the pitch, with the directors fighting the owners has been quite an eye opener as to how far we've moved away from LFC values.
It seems its primarily greed thats driving this entire process of the sale, and the drama has found its way into the dressing room and onto the pitch.
 
I'm sure Broughton and the other directors are astute businessmen, and it would be great if the offers of both NESV and the Singaporean businessman are compared and considered.
The future or the demise of Liverpool FC can begin with whoever next owns the club.

Things should be done in a transparent way so that the same mistakes are not repeated. I fear that the board are a bit too eager to sell to NESV. Or is that just my paranoia?
Besides decent accomplishments with Red Sox, what other resources do they have to fund LFC to help it become a trophy winning club again?

Where is all the money for buying the club, wiping out the debt, buying new players and bulding/ expanding a stadium giung to come from?

Would it be best for the LFC to be managed by board (NESV) or by a single person with a vested interest in the club?

These are not questions that have been answered in any of the Official LFC statements. I do hope its not history repeating itself again.

Jody Daniels said...

Jaimie, you're quite good at investigating these stories. And yes, you do have strong opinions about the owners, SOS and other matters concerning Liverpool FCas do most LFC fans. My question is this, have you looked into NESV's offer?

its probably likely that the injunction will be overturned, and that finally LFC directors will be allowed to proceed with selling the club, but is NESV the best option for LFC going forward? As compared to other bids, most notably the Singaporean businessman who has "allegedly" increased his offer and have "alledgedly" not received any response from LFC directors.

All the drama off the pitch, with the directors fighting the owners has been quite an eye opener as to how far we've moved away from LFC values.
It seems its primarily greed thats driving this entire process of the sale, and the drama has found its way into the dressing room and onto the pitch.
 
I'm sure Broughton and the other directors are astute businessmen, and it would be great if the offers of both NESV and the Singaporean businessman are compared and considered.
The future or the demise of Liverpool FC can begin with whoever next owns the club.

Things should be done in a transparent way so that the same mistakes are not repeated. I fear that the board are a bit too eager to sell to NESV. Or is that just my paranoia?
Besides decent accomplishments with Red Sox, what other resources do they have to fund LFC to help it become a trophy winning club again?

Where is all the money for buying the club, wiping out the debt, buying new players and bulding/ expanding a stadium giung to come from?

Would it be best for the LFC to be managed by board (NESV) or by a single person with a vested interest in the club?

These are not questions that have been answered in any of the Official LFC statements. I do hope its not history repeating itself again.

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