More Questions From Supporters About Proposals For Hereford FC

Following the proposal for the formation of Hereford FC by HUST and the Hale group last week, a number of fans have raised some questions about what has been presented thus far.

It's worth stating that the effort put in so far by the Hale group is much appreciated, and the generosity of the benefactors is something we are very grateful for; however, we feel that there a number of issues where we would like either answers or clarifications before we can fully understand the proposal.

The Hale consortium has said they will provide a set of FAQs in advance of the meeting on Thursday, and hopefully a large number of our questions will be answered by these. However, given the proximity of this meeting, to give the Hale consortium sufficient time to consider any questions that are not covered by the FAQs, we feel we need to ask them now. Some of the questions have been taken from Bulls Banter, and are thus quite direct, but nevertheless well intentioned.  We hope that they would be received in the spirit in which they are intended i.e. with no intent to offend, but with a wish for greater understanding of the proposal on the table so that all supporters can work together in building a united Hereford FC.

Background Information on the Consortium

1.      Who are the Consortium members/when will their identities be published?

2.      What specialist areas of expertise do each of the Consortium members possess?

3.      What does the consortium offer the benefactors that was not available through the trust?

4.      What does the consortium offer the supporters that was not available through the trust?

5.      What shareholding is each Consortium member intending to take up?

6.      Do any of the benefactors:
- Have a history of company failures?
- Ever been barred from being a director?
- Ever been declared bankrupt?
- Have an IVA?

7.      What's the difference between a benefactor and a shareholder?

8.      How does one become a benefactor?

9.      You have chosen to invest your funds outside the auspices of the Trust. What are the reasons for doing this?

a) If you believe that the HUST board lacks the sufficient business acumen to successfully run a football club. Why are you not prepared to stand for election to the board of the new club? HUST have suggested that it is reasonably easy to achieve this due to a lack of members prepared to stand for election. With your experience and high profile you would seem to stand an extremely good chance of election. 

b) Further to point a): are you sure that you're the best people to run the new football club? Previously many successful individuals have believed they are those best people but have subsequently failed to achieve success. Previous business success appears no guarantee of football success. The Trust now numbers over 1,000 members. Might there be someone more appropriate amongst that membership?

 

 

 

Share and Boardroom arrangement

1.      To the trust: The current proposals allow you to achieve a 50% shareholding in the new club. However they also allow private 'benefactors' to achieve a 24% holding. Do you believe this will adversely affect your ability to realise a 50% holding? 
If indeed you do fail to achieve a 50% shareholding (which appears at least possible) what safeguards are there in place to prevent a private 'benefactor' from achieving a majority shareholding in the club? The Board's right to approve new shareholders seems insufficient since a) Hust do not command a majority of the board and b) new investors frequently appear appropriate but prove unsuccessful.

2.      How is the share capital to be taken up? Will it be in stages with matching take ups from HUST and the Consortium or will HUST be credited immediately with £150,000 against a loan from the Company which they will have to pay back in time?

3.      How many shares will be released?

4.      How much will each share cost?

5.      Can shares be sold at a profit at a later date?

6.      Can individual fans apply for shares in their own right and is there a limit on the amount they can purchase?

7.      How long do we have as Trust members to raise this £150k? The wording seems to imply that there will be a time limit?

8.      How long will HUST have to purchase their ring fenced 50%?

9.      Will HUST have 50% voting power before it owns all the shares?

10.  Are Hale and Co expecting to have first option on purchasing the remaining 50% of shares?

11.  If at a point in time HUST does purchase all of their 50% ring fenced shares why should they accept being outnumbered on the Board?

12.  Why is there a 4:3 board room split when potentially HUST could own an equal share of the club? Wouldn't parity of seats be better?

13.  While HUST is provided with 3 Board positions initially with or without initial finance input on their behalf :
a) What happens if for any reason the £150k of funding for shares is not raised. Does this affect the number of Board positions HUST is provided with in the future? How long does the Trust retain 3 Board Director positions? What is the default position with regards to both these scenarios?
b) What protection is there for fans/HUST in any voting at EGM's/AGM's that takes place BEFORE the 50 % shareholding has been acquired by HUST?

14.  If say only £100k is raised in say 5-10 years then is there any protection for fans/Trust when it comes to AGM's or EGM's regarding voting (eg Jon Hale Benefactors Group could move on, resign etc before the Trust is in a position to purchase the full £150k maximum amount of ring fenced shares.)

15.  How will the non-HUST board members be selected? Is Hale expecting his consortium to be parachuted onto the Board?

16.  How will the club Chairman be appointed?

17.  Have both the Consortium and HUST considered the suggestions which were published on the ‘Save Edgar Street’ blog which include the proposal for the club Chairman being appointed annually through a HUST Membership vote? Would this be something which both groups would consider acceptable?

 

The HUST Membership Vote

1.      To the trust: Has an independent returning officer been appointed to receive and count votes? If not, how can there be confidence in the vote procedure?

2.      The Constitution requires that all members are provided with sufficient information to make an informed decision. How are the trust going to ensure that all members have access to the information provided during the open meeting Q&A session?

3.      What will HUST do in the event of the HUST membership voting against the Hereford FC proposal

4.      To the consortium: What is the Hale consortium's plan if HUST vote against their Hereford FC proposal? Will they carry on regardless?

 

Facilities for next season

1.      Does the application for a league due by 31st March require the club to state the ground it will use for next season?

2.      It is understood that the hale consortium will be seeking a new single lease covering the entire stadium and will be passing any development opportunity associated with the lease back to the council. Have any of the benefactors or their appointed directors been in contact, or have plans to contact, the council about this opportunity?

3.      Why are the consortium planning on allowing the council to redevelop? Will this be to help their bid to set up a club go smoothly and thus allow their bid to be accepted as long term it'll help to reduce a potentially very good source of income for the club?

4.      Did either the benefactor or their appointed directors ever contact the council about the development opportunities associated with Hereford FC 1939 Ltd ?

5.      If the position regarding Edgar Street is not resolved by the time the application is due to be submitted is there a fall back agreement to groundshare with a local club?

6.      Will the new club be entitled to the income from the telephone paraphernalia on the floodlight pylons?

7.      What are the immediate plans for the Starlite Rooms -will they be opening again soon as a function facility to bring in revenue?

 

The Long-term future

1.      What measures are the consortium going to put in place to ensure the football club NEVER AGAIN falls into the wrong hands thus repeating the events of the past four years?

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