Summary Of The MYFC Document

[Coldplayer]

Should make it a little easier to digest, taken from the MYFC forum;

 

Executive Summary (i.e. short and sweet)

 

MyFC will buy 75% Stake in Ebbsfleet FC for £635,000.

The 75% stake will allow MyFC to run the football club they way it wants.

 

MyFC is not buying out current owners, just buying new issued shares in the club.

The current owners will retain their now diluted shares.

 

MyFC Members will vote to accept the deal.

Vote will close 12:00pm Jan 23rd.

Yes or No vote only.

Members will not see the Agreement or Due Diligence, only the summary.

No changes are possible in agreement.

 

A 2nd vote will allow Liam Daish to have transfer budget in

January and re-sign current players.

 

MyFC Members will start picking the team in March

 

MyFC Society Board will be chosen in Feb and Mar 2008, along with CEO.

 

No talk on forums allowed on structure of deal, only talk on if Ebbsfleet is right for price.

FT will close down threads if necessary.

 

Background Summary

 

Three football teams were front runners (not Halifax), one higher price, one lower.

 

EUFC was better because - price, transport links, potential, availability,

two year payments, league position, ground, potential for new ground,

youth section, club is in new era.

 

Deal Structure Summary

 

Ebbsfleet United Football Club Limited (the Club) - owns player contracts,

the FA Registration, and the lease of the ground

 

Fleet Leisure Limited (Leisure) - leases the training ground and facilities

 

Fleet Group Development Limited (Developments) - In talks for a new stadium

 

Three new shares of stock will be created, classes, A, B, C.

 

MyFC Society will own all A shares

 

Current owners will own B & C shares.

 

A & B shares decide Business side of club

 

C shares decide Leisure and Development side.

 

A shares = MyFC shares, control most football decisions.

B shares = Old owners shares, some power. Veto over some decisions (winding up, etc).

 

Payments : £635,000 over 2 years (£400,000 due now), £235,000 in 3 installments,

£125,000 in 1 year, £40,000 at 2 years, remaining £70,000 is paid we needed to pay off debts.

 

The Club will lease the training ground from Leisure for £40,000 per year,

increasing to £48,000 per year over 13 years.

 

Development Group will continue to try and secure a new stadium,

club will be charged £135 per hour consulting fee not to exceed £40,000 per year.

 

Club is currently running £26,000-£28,000 in debt every month.

 

21 day notice to EUFC shareholders will be given,

but is moot because 75% already agreed.

 

Post Takeover Summary

 

Daish & Assistants contracted to end of 2008-2009 season

 

MyFC Society Board will be chosen in Feb and Mar 2008, along with CEO.

Advisory committee of past directors will be created.

 

Jason Botley stands down as chairmen, and Brian Kilcullen is interim.

[blassberg]

thanks )

[Hempstead Gaz]

£28K debt EACH MONTH!!!

I can see now why the board were so keen on the deal.

[Claudius]

Yes,

That round little number of 28K per month gave me an oops moment as well.

Should do wonders regarding the welcoming of MyFC as new owner though.

 

[EUFC FAN]

What should also be mentioned is that “75%” is not all it seems. The club has been split up into three entities. The football side, Fleet Leisure side, Ground Development side. Of these three MyFC will own 75% of the football side only. So Fleet Leisure and the Ground Development side will not be under the MyFC wing. This is causing some concern amongst the members.

[PatMan]

Originally Posted By: EUFC FAN

What should also be mentioned is that “75%” is not all it seems. The club has been split up into three entities. The football side, Fleet Leisure side, Ground Development side. Of these three MyFC will own 75% of the football side only. So Fleet Leisure and the Ground Development side will not be under the MyFC wing. This is causing some concern amongst the members.

Why tho? Isn't Fleet Leisure losing money? And the development is just about paying for consultants?
Or am I missing something??

[Slartibartfast]

That means we are 1,000 fans light at each home game.

 

Any idea who the other 999 are C.G.?

[EUFC FAN]

Originally Posted By: PatMan

Why tho? Isn't Fleet Leisure losing money? And the development is just about paying for consultants?
Or am I missing something??

I don't see it as a problem either. I much rather rent the facilities of the Fleet Leisure for 48K than own them out right. The cost of running a leisure centre as well as a football club is probably beyond the means of MyFC...

[Santa]

Originally Posted By: EUFC FAN

Originally Posted By: PatMan

Why tho? Isn't Fleet Leisure losing money? And the development is just about paying for consultants?
Or am I missing something??

I don't see it as a problem either. I much rather rent the facilities of the Fleet Leisure for 48K than own them out right. The cost of running a leisure centre as well as a football club is probably beyond the means of MyFC...

Some at MyFC see Fleet Leisure as an asset that is being hived off, they are slowly being put right.

[rvr]

Originally Posted By: Santa

Originally Posted By: EUFC FAN

Originally Posted By: PatMan

Why tho? Isn't Fleet Leisure losing money? And the development is just about paying for consultants?
Or am I missing something??

I don't see it as a problem either. I much rather rent the facilities of the Fleet Leisure for 48K than own them out right. The cost of running a leisure centre as well as a football club is probably beyond the means of MyFC...

Some at MyFC see Fleet Leisure as an asset that is being hived off, they are slowly being put right.

From the statement: "The Society will have no rights to control or receive any moneys (dividends) from the Leisure or the Developments subsidiaries, which will only be paid to the existing shareholders (as owner of the C Shares). Save only in limited and unlikely circumstances, the Club will also not be liable for any new liabilities those subsidiaries may incur (since those companies are limited liability companies - literally, the liability of the parent (the Club) will be limited to the amount that it has already paid to the subsidiaries for its shares in the subsidiaries). In the unlikely event that the Club is found liable for the debts of its subsidiaries, we have negotiated an indemnity in the shareholders' agreement pursuant to which the existing principal shareholders in the Club have agreed to indemnify the Society for any losses it suffers as a result of holding shares in the subsidiaries. For the avoidance of doubt, the Society will not therefore be liable for any new debts incurred by the two subsidiaries. We feel that this is important in order for members to be able to concentrate on the football side of the group. It was also essential in order to make the Club affordable.

Any insolvency of the subsidiaries should not therefore lead to the insolvency of the Club."

I think this is where some people are getting the idea that Fleet Leisure can be "heeved" off...

[Uncle Urchin]

so let me get this right then...FL owes the burden of debt (or does it?) if it does when does it get liquidated?

 

600k I said...and I was right but we'll have to wait for the accounts then won't we...30 grand a month...????

 

no one is allowed to discuss this matter on the forum...

 

really..? which one..?

 

where are the results of DD which members are paying for but are not allowed to see....

 

how much is the final bill for DD..?

 

heads in sand time boyos...

[Unrecognized Genius]

I believe you paid your £35 so you could know what was going on? If not, apologies, I am misremembering an earlier post of yours. If you did though, you have access to the full statement & will know that you are deliberately highlighting some of the summarised points totally out of context.

 

EG

 

You say: "600k I said...and I was right but we'll have to wait for the accounts then won't we...30 grand a month...????"

 

The statement addresses this: "Prior to takeover, the monthly trading losses of the Club (without any additional income) were somewhere between GBP26,000 and GBP28,000 (on the assumption that the Club loses every cup game). This deficit is largely down to funding a playing staff capable of challenging for promotion to the Football League.

We would like to report that during our financial due diligence we found the club's day to day financial management generally to be in good order (ie. VAT and PAYE were up to date, which is not the case with a lot of clubs). Clearly, however, the Club could only continue to fund the ongoing deficit through director's and others loans.

 

 

We are confident that the MyFootballClub model is more than capable of reversing this situation. We expect an increase in merchandise sales, advertising revenue, sponsorship revenue, dedicated TV channel income, increased gates, and other income. And taking account of the number of members whom (based on current sign up rates) are likely to sign up daily throughout year one, the risk of not being able to fund any deficit until the end of January 2009 (when renewals of membership are due) appears remote."

 

 

You say: "no one is allowed to discuss this matter on the forum ... really..? which one..?" implying that some Orwellian ban has been put on any discussion of the Club's debt.

 

However, what is actually said comes from a completely different part of the statement: "It's important that when members discuss the proposed takeover of the Club, the debate focuses on whether Ebbsfleet is the right club at the right price, not whether the price could be improved or the deal structured differently. The Society has paid a considerable sum for financial and legal due diligence and for DLA Piper to agree a structure for the deal. This is the only deal on the table, and it can't be changed.

 

The Forum Team has therefore been asked to close threads which become wholly focussed on the deal's structure, and whether the deal could have been structured differently, particularly where those threads are inaccurate or misleading."

 

You say: "where are the results of DD which members are paying for but are not allowed to see...."

 

What the statement actually says on this is: "Legally we are unable to publish full due diligence and transaction documents. The Society instructed DLA Piper to carry out this work on it's behalf. DLA are a trusted and leading global law firm and we have paid for their services. We have also employed an accountancy firm to carry out financial due diligence.

 

Due to confidentiality, we are unable to go in to any more detail. However, the following description of the deal has been agreed by both parties, and we believe it gives members a very good understanding of the proposed transaction....

 

...It's not possible to summarise every term of every document, but this summary does provide a lot of detail about the deal. It's also not possible to disclose the transaction documents to members, because there are confidentiality provisions in the documents (as is standard), but we believe that this article provides a good snapshot of the major points, and will allow members to make an informed decision."

 

Maybe I'm a mug, but I found the statement extremely informative & well put together. I don't feel I've been kept in the dark about anything. I also notice that even at this late hour new members were signing up at 22.37, 22.39, 22.55, 23.03, 23.08, 23.10, 23.13, 23.16, 23.19 ...

 

EC

 

 

[thatguy]

Am I still correct in thinking that Eurostar's sponsorship money should start coming in next season, as they still have two years to run on this deal, and the money would only start coming in the second year of this deal?

So that should give even more income.

[David Holden]

No the money started coming in from the start of the deal

[Hempstead Gaz]

Originally Posted By: Slartibartfast

That means we are 1,000 fans light at each home game.

Any idea who the other 999 are C.G.?

You might scoff and ridicule the fact the club are losing about £350,000 per year, and can make light of it, but everyone else is aghast at the board allowing the situation to happen in the first place.
MyFC, like them or not, appear to have saved the club from bankruptcy.
How much longer would the present board have avoided administration with debts running at that level?

Questions still need to be asked of the current board, such as how was that sort of monthly debt allowed to arise, bearing in mind the club has always been previously run on a tight, thrifty budget, not spending what couldn't be afforded?

[John Pearce]

Originally Posted By: Chatham Gary

Originally Posted By: Slartibartfast

That means we are 1,000 fans light at each home game.

Any idea who the other 999 are C.G.?

You might scoff and ridicule the fact the club are losing about £350,000 per year, and can make light of it, but everyone else is aghast at the board allowing the situation to happen in the first place.
MyFC, like them or not, appear to have saved the club from bankruptcy.
How much longer would the present board have avoided administration with debts running at that level?

Questions still need to be asked of the current board, such as how was that sort of monthly debt allowed to arise, bearing in mind the club has always been previously run on a tight, thrifty budget, not spending what couldn't be afforded?

Hi Gary,

Could'nt agree more. Is it any wonder that Botley seems to be disappearing from the scene as quickly as he can after the MyFC farce goes through.

It would seem that he/they have a lot to answer for, but won't be around to answer the questions, or to face the music when this all goes belly-up, as I am sure it will.

[Slartibartfast]

I suspect that when we had a part-time team competing in the bottom half of the table in front of gates of 1300-1400 with the occasional 1700 the board erroneously thought that putting a superior product in front of the public would mean bigger gates, i.e. 1700 regularly and topping 2000 for big games.

We now have a full-time team which competes in the top half of the table and plays in front of 900.

The missing 800 would cover the weekly operating loss.

 

The dissapointing thing, other than the fact that nobody bothers to watch us, is that it seems the board gambled on the fact that more people would turn up to watch a succesful team but told us that going full-time wasn't a gamble.

[Hempstead Gaz]

Hi John,

 

Some decisions have been taken in the last 3/4 years by the board which have proved to be, at the very least, questionable.

Why the indecent haste to go full time?

Why didn't we "invest" in our best assets, ie players such as MacDonald, by giving longer contracts?

Why the change of name without consultation?

Why the acquistion of Fleet Leisure, when for years it has been running at a loss, and still does?

Why the prolonged delays in coming up with firmer proposals for a new ground?

Were any discussions made with LaFarge about extending the lease on San Stonebridge stadium, with a mid term view to "do it up"?

I could go on, but I won't.

I do not expect any answers.

What I will expect is the usual unwitty comments, head in the sand attitude that can be found on here so often

[PatMan]

Originally Posted By: Slartibartfast

I suspect that when we had a part-time team competing in the bottom half of the table in front of gates of 1300-1400 with the occasional 1700 the board erroneously thought that putting a superior product in front of the public would mean bigger gates, i.e. 1700 regularly and topping 2000 for big games.
We now have a full-time team which competes in the top half of the table and plays in front of 900.
The missing 800 would cover the weekly operating loss.

The dissapointing thing, other than the fact that nobody bothers to watch us, is that it seems the board gambled on the fact that more people would turn up to watch a succesful team but told us that going full-time wasn't a gamble.

Sums up the apathy of local people/ex-fans quite honestly.
Quality post.

[Hempstead Gaz]

Originally Posted By: Slartibartfast

I suspect that when we had a part-time team competing in the bottom half of the table in front of gates of 1300-1400 with the occasional 1700 the board erroneously thought that putting a superior product in front of the public would mean bigger gates, i.e. 1700 regularly and topping 2000 for big games.
We now have a full-time team which competes in the top half of the table and plays in front of 900.
The missing 800 would cover the weekly operating loss.

The dissapointing thing, other than the fact that nobody bothers to watch us, is that it seems the board gambled on the fact that more people would turn up to watch a succesful team but told us that going full-time wasn't a gamble.

Spot on Slarti.
Unfortunately, the board appeared to haved changed policy from being frugal and no-risk, to taking gambles on several ideas, many of which have backfired.

I reckon we are VERY fortunate that MyFC have stepped in to save us from oblivion, but unless the real money eanrer - gates, are substantially increased, MyFC will lose patience being a sponsor to a loss making club and pull out.
I suppose it boils down to being run by MyFC and having a club which is in danger of losing it's homely identity, or going the same way as plenty of other Kent clubs have gone - under, then rebuilding from scratch.
Part of me wants success, but a bigger part of me still has a soft spot for G&N FC, regardless of the league and opposition.