The meeting was chaired by Peter Phillips, of PlayerShare, and was attended by Tony Swaisland (AFCB Chairman), Mike Beviss (Club Auditor), Stanley Cohen (Club President), Andrew Kaye (Director), Andrew Noonan (Company Secretary) and Sean O'Driscoll (Manager).
The meeting started with Mr Swaisland outlining the current problems faced by AFC Bournemouth and what is being proposed to resolve those problems.
PROBLEM
For 3.5 years, the Club have been trying to rasie sufficient cash to clear it's debt, and have explored all possibilities to rasie the finance to do so. We have numerous creditors waiting for their monies, whether it is Barr, for the Stadium or Lloyds Bank for the rest of their money. The proposed Sale and Lease of Dean Court would release £4 million to AFC Bournemouth from a 'substantial UK Property Investment' company, for which AFC Bournemouth would have to pay rent on the property for the next 20 years. The rent would go up at agreed points in time with prior agreement as to how much the rent should be. So the Club will know exactly how much they need to find and when.
Mr Swaisland did make it very clear that all avenues had been explored, but with the current climate of uncertainty in football, the various financial institutions are not being very helpful at this moment in time.
SOLUTION
As we've all seen and heard, the one proposal which is on the table at the moment is the Sale and Lease of Dean Court, making substantial funds available to the Club. This would enable them to pay the following major creditors:
Barr Construction
Lloyds Bank
Bristol and West
Tony Swaisland
Stanley Cohen
Fitness First
Lloyds Bank
Bristol and West
Tony Swaisland
Stanley Cohen
Fitness First
which would leave approximately £1 million of the £4 million available for squad strengthening and other projects (including the payment of rent for 2 years).
There then followed a lengthy question and answer session on the merits of the Sale and Leaseback deal.
Why is the Sale and Lease back only going to raise £4m when the Stadium cost £6.7m to build?
This is because there isn't a great demand for Football Stadia in Bournemouth, and £4m is what it is currently worth.
As Mr Swaisland will benefit from the deal, is there a conflict of interest?
A letter was produced from Lester Aldridge stating that there is no conflict of interest.
What would the monies enable us to do?
It would enable us to clear the existing debt, which will also save £250k pa on interest payments. The deal would enable us to pay off £3m debt which would enable £1m to be used on improvements as well as squad building. For example fans are offering to pay for the fitting out of the Conference and Banqueting facilities. They are £100k short of their £750k target.
How much rent would we have to pay?
We would have to pay 8.5% of the value (approx £340k pa). Over the period of the 20 year deal, the rent would go up at agreed times by agreed amounts.
Would improvements to the ground affect the rent?
In short - no - even if we build the 4th side. But if the Property Investment Company bult the 4th side for us, there would be a rent review at that time.
What attendance would be required to break even for the new season?
We would need crowds of +6000 (including the 1700 season ticket holders).
At the last AGM it was stated that the Club is a going concern. Are we still a going concern? And what has changed it we're not?
Firstly we are still a going concern. In terms of what has changed since the AGM in December 2001? The deal with ITV Digital has collapsed, leaving AFC Bournemouth without a payment of £120k, which was due in September, and relegation meant that we receive £100k less from the Football League. With this in mind, the Club have seen the writing on the wall and are taking actions to safeguard the future of AFC Bournemouth.
Would the sale of Matty Holland make a difference to the Sale and Leaseback?
It would, but AFCB cannot guarantee when a deal would happen and have to proceed on the assumption that it will not. But if it were to happen in the next few weeks, the S&L deal would be re-appraised.
What is the timeframe for the S&L deal?
The deal is not done and dusted, but initial contract exchange would take place in about 4 weeks (mid-July). It was stressed that the meeting was not window dressing, and fans groups will be able to view the cash flow forecasts before the deal is signed.
Are there any show-stoppers?
Yes, if the Football Trust want their money back as a result of the S&L deal. AFCB have written to them, out of courtesy, and are waiting a response.
When will there be fan reps in the Board?
There will be fans on the Board, but the Club want to get past the current difficulties first. An Executive Board will be created, which will work along side the main board.
Who will be our new landlords?
For confidentiality, the name of the company involved was not mentioned, but has been checked out in the City by Mr Swaisland and Mr Cohen, and does appear to be a reputable company.
Can we buy the ground back?
We would have first refusal if the company went bust or wanted to pull out of the deal at a future date?
Can we be evicted?
Yes, only if we miss a payment. At the end of the 20 year period, the lease (legally) has to be renewed if we've not missed a payment.
Towards the end of the meeting, discussion moved to more general topics.
What happened to the money from the Eddy Howe deal?
Here Mr. Swaisland was very clear:
1. Two months worth of PAYE to the Inland Revenue.
2. Urgent creditors who were threatening to sue.
3. Staff salaries.
4. Settling terminated contracts.
How much did Fitness First pay AFC Bournemouth?
The figure was not disclosed, but was paid in one lump sum.
Can playing wages be cut?
Our wage bill is already one of the lowest in the Third Division.
Will we become a nursery Club? Or go part-time?
It is quite possible that a Premiership side will seek us out, once the rules on this change. As for going part-time, there is little point going doen this path as the top non-League sides pay full-time wages for part-times players.
Will Mel Machin leave his Testimonial money in the Club as a loan?
Mr Swaisland did say that this matter was being negotiated.