Mark Attanasio

[shefcanary 2,446]

15 minutes ago, GMF said:

I’m not sure if you are correct here @shefcanary, as there are specific inheritance provisions (which are understandable) for both parties. More than happy to stand corrected, mind, if others agree with you.

I am happy to accept your view if others agree.

There has to be some reason why the TP were happy to consider Tom as independent; by not benefitting directly from this deal (i.e. an implication in writing that he will not inherit Delia & Mike's shares - the money they receive from them is another matter) is certainly one way this could have been confirmed. 

[GMF 756]

9 minutes ago, shefcanary said:

I am happy to accept your view if others agree.

There has to be some reason why the TP were happy to consider Tom as independent; by not benefitting directly from this deal (i.e. an implication in writing that he will not inherit Delia & Mike's shares - the money they receive from them is another matter) is certainly one way this could have been confirmed. 

Would this actually be within the remit of the TP in the context of the proposal before it?

 I’m asking because I genuinely don’t know, but I would be surprised if they could.

[Badger 2,412]

14 hours ago, norfolkngood said:

i totally Agree ,

Nobody knows how this will play out of course if he bought it cheap he might put more money into it ( i doubt that )

 

MA knows that if he does nothing he is likely to make very good profit - it is only by "putting money  in" that puts this at risk. Why would he?

[Badger 2,412]

4 hours ago, Soldier on said:

If the waiver is not voted for my take is we find ourselves in an incredibly difficult financial situation ? 

What do you base this view upon?

[Soldier on 162]

Attanassio could take unbridge and withdraw or want payment for his extrnsive favourable loans. Would leave us in a very precarious financial position ?

[norfolkngood 1,087]

13 minutes ago, Badger said:

MA knows that if he does nothing he is likely to make very good profit - it is only by "putting money  in" that puts this at risk. Why would he?

Well i think you have hit nail on head question ,

Depends how much he pays , if  MA buys it cheaply then turn instant profit i agree ,

but Delia must know round about how much the club is worth why not hand that wealth for family instead of making a Rich American Richer ? 

if MA Pays a lot of money he would have to invest to make a profit as only get a profit if successful and in PL ,

Delia & MWJ said she has never wanted to make money out of club but she deserves it more than someone who walks in buys it cheap and sells for a profit ( if that is what he does we do not know yet ) 

[essex canary 505]

1 hour ago, PurpleCanary said:

It is less than three weeks to the vote. Are there any crucial decisions regarding shareholders/shareholdings that need to be taken - and announced -  before then?

If there is any danger of MA claiming 7% on his C Preference Shares, could it be argued that there is a need to restore a balance in favour of minorities?

[Badger 2,412]

 

1 hour ago, PurpleCanary said:

But, yes, it is possible Attanasio could take umbrage, and change his plans.

If he were to change his plans, how much money would we have to find and how quickly? I know that he has lent us money but we don't know at what rate or the repayments terms? 

Some are suggesting that MA's umbrage could be financial catastrophe for us, but I don't really see how* - am I missing something?

*although there might be some short-term discomfort

[essex canary 505]

10 minutes ago, norfolkngood said:

Well i think you have hit nail on head question ,

Depends how much he pays , if  MA buys it cheaply then turn instant profit i agree ,

but Delia must know round about how much the club is worth why not hand that wealth for family instead of making a Rich American Richer ? 

if MA Pays a lot of money he would have to invest to make a profit as only get a profit if successful and in PL ,

Delia & MWJ said she has never wanted to make money out of club but she deserves it more than someone who walks in buys it cheap and sells for a profit ( if that is what he does we do not know yet ) 

Indeed and even if Delia wants to defy the laws of Economics herself, no right to impose it on the minorities.

[GMF 756]

7 minutes ago, essex canary said:

If there is any danger of MA claiming 7% on his C Preference Shares, could it be argued that there is a need to restore a balance in favour of minorities?

MA is legally entitled to interest at the prescribed rate, as are all other preference share holders. Whether he elects to take it, is a different matter.

Could it be argued; by you, yes, by others, probably not. 

[shefcanary 2,446]

1 hour ago, GMF said:

Would this actually be within the remit of the TP in the context of the proposal before it?

 I’m asking because I genuinely don’t know, but I would be surprised if they could.

The TP have allowed the detail within the Circular as being reviewed by them and to include true statements. I'm going off Purps reservations about the process as well as my own knowledge. More importantly a layman reading the circular would question the naming of Tom as an independent director; there must be a reason why the TP were happy for a family member of one of the parties to be deemed an independent Director and so assume that Delia and Mike must have given assurances to the TP that Tom would not benefit directly from the transaction - being previously publicly named as the main beneficiary of their shares would definitely go against that, so logically the assurance the TP received was that Tom was no longer in line to inherit the shares. This is also borne out by the fact both parties no longer see a trigger event happening, one of those being the question of inheritance of shares forming one of those.

[shefcanary 2,446]

22 minutes ago, Badger said:

 

If he were to change his plans, how much money would we have to find and how quickly? I know that he has lent us money but we don't know at what rate or the repayments terms? 

Some are suggesting that MA's umbrage could be financial catastrophe for us, but I don't really see how* - am I missing something?

*although there might be some short-term discomfort

You are right; Attanasio walking away and demanding immediate repayment of his loans would not in itself bring the immediate demise of the club - there would be other sources of finance, albeit at frighteningly high rates of interest until they were repaid by a firesale of our playing assets (no doubt at below true market value). It would certainly bring about a sharp reversal of recent progress on and off the pitch.

[GMF 756]

6 minutes ago, shefcanary said:

The TP have allowed the detail within the Circular as being reviewed by them and to include true statements. I'm going off Purps reservations about the process as well as my own knowledge. More importantly a layman reading the circular would question the naming of Tom as an independent director; there must be a reason why the TP were happy for a family member of one of the parties to be deemed an independent Director and so assume that Delia and Mike must have given assurances to the TP that Tom would not benefit directly from the transaction - being previously publicly named as the main beneficiary of their shares would definitely go against that, so logically the assurance the TP received was that Tom was no longer in line to inherit the shares. This is also borne out by the fact both parties no longer see a trigger event happening, one of those being the question of inheritance of shares forming one of those.

The question of independence is one I understand, but I don’t believe that the TP could have any influence, as a point of principle, on the inheritance provisions of either DS&MWJ, or MA.

Furthermore, Clause 8 of the Shareholder Agreement makes specific provisions for the inheritance proposals of both parties, deeming them to be Permitted Transfers in the context of the Shareholder Agreement.

What you’re suggesting is a possibility, but it seems like a remote one to me personally.

[PurpleCanary 5,580]

1 hour ago, Badger said:

 

If he were to change his plans, how much money would we have to find and how quickly? I know that he has lent us money but we don't know at what rate or the repayments terms? 

Some are suggesting that MA's umbrage could be financial catastrophe for us, but I don't really see how* - am I missing something?

*although there might be some short-term discomfort

Badger, at this point I make my excuses and defer to those with professional expertise as far as the financial details are concerned.

[MrBunce 245]

50 minutes ago, shefcanary said:

You are right; Attanasio walking away and demanding immediate repayment of his loans would not in itself bring the immediate demise of the club - there would be other sources of finance, albeit at frighteningly high rates of interest until they were repaid by a firesale of our playing assets (no doubt at below true market value). It would certainly bring about a sharp reversal of recent progress on and off the pitch.

The issue is that if the waiver doesn't pass the club will have to repay twice the principal of the loan in Feb 2024, that is $12m. Bear in mind also that the first £31m repayment of the secured lending on parachute payments is due in March 2024 (assuming it hasn't been refinanced, though I'd question why you refinance loans at 5.75% to those at 11% with the same maturity). That is a significant cash crunch.

As I've mentioned before, however you cut it, Attanasio is getting a great deal. 

Edited September 13, 2023 by MrBunce
incorrect figure

[PurpleCanary 5,580]

46 minutes ago, shefcanary said:

The TP have allowed the detail within the Circular as being reviewed by them and to include true statements. I'm going off Purps reservations about the process as well as my own knowledge. More importantly a layman reading the circular would question the naming of Tom as an independent director; there must be a reason why the TP were happy for a family member of one of the parties to be deemed an independent Director and so assume that Delia and Mike must have given assurances to the TP that Tom would not benefit directly from the transaction - being previously publicly named as the main beneficiary of their shares would definitely go against that, so logically the assurance the TP received was that Tom was no longer in line to inherit the shares. This is also borne out by the fact both parties no longer see a trigger event happening, one of those being the question of inheritance of shares forming one of those.

Shef, forgive me, but you may be over-thinking this!😍 I suspect the Takeover Panel accepted Smith and Webber as independent directors solely because they are not part of the concert party of what are regarded as dependent directors.

But that is purely legalistic. They are not independent directors in the way you and I would understand the term. I don't think Norwich City have ever had any independent directors. 

But leaving all that aside, the broader point is that the Takeover Code calls for the publication of independent analysis/assessment/advice, And for that to means what it says it has to come from outside the club, not from two directors, whatever their legalistic status.

[PurpleCanary 5,580]

8 minutes ago, MrBunce said:

The issue is that if the waiver doesn't pass the club will have to repay twice the principal of the loan in Feb 2024, that is $12m. Bear in mind also that the first £31m repayment of the secured lending on parachute payments is due in March 2024 (assuming it hasn't been refinanced, though I'd question why you refinance loans at 5.75% to those at 11% with the same maturity). That is a significant cash crunch.

As I've mentioned before, however you cut it, Attanasio is getting a great deal. 

Thanks. I hadn't realised that!

[MrBunce 245]

On 07/09/2023 at 14:46, shefcanary said:

I've received my voting envelope this morning, the post to South Yorks is damn slow. First my apologies, i appear to have made one or two false assumptions in earlier posts, although nothing detracts from the story and wouldn't have changed anybodies view.

Anyway, as promised, now I have hard copy of some of the relevant documents I have scribbled out a diagram (below my scribble, yes, I have awful handwriting) of what is going on and also been able to compare the contents of the shareholder agreement to the financials in the circular.

One question that bothered me was Paddy's clear statement that Attanasio had injected £70m into the club. My review of the paperwork I think has enabled me to identify where Paddy's £70m investment figure came from! But, and it is a big but, there is no direct linkage from the shareholder agreement figures to those in the circular document and thus no overarching summary of what has occurred - I guess we wait for the annual financial statements for that? There is a lot of detail unsaid, as i have said previously.

Anyway, I think there are actually two large loans to the club from across the pond, not one big one and a small one! One on 13 Sept 22 from Norfolk for £33m, which includes $6m share capitalisation amount (the inconsistency of use of GBP to US$ has led to me previously making false assumptions that it was 2 loans, a $33m loan and a separate $6m loan) as discussed in the circular. But also another £27m made on 20 Jan 2023 from Attanasio (not Norfolk and so not discussed in the circular paperwork?) as part of the Shareholder agreement. Add the £10m for the C Pref Shares, this is I believe the £70m cash injection that Attanasio and Co. have provided as revealed by Paddy. But there is no confirmation that all this has happened, it may be that some of the loans have never been drawn, they could just be facilities available! 🤷

On top of that is the £3.3m paid by Norfolk for the shares of Foulger et al plus costs etc. So total US investment to date could be £73m, which as a cost so far for 40% values the club at £175m, if the loans are not repaid. If the loans are repaid however, the shares acquired will only have cost £8m with the much lower valuation of only £20m. I personally think the club is worth c.£100m, the value put on the club in the C Pref issuance.

The total loans above from the US are equivalent to the two loans of £66m set out in the last set of accounts, the clear assumption being Attanasio has provided the cash to pay these off early. Is the club actively repaying the loans to Attanasio et al and paying interest on them? Oh for a set of interim accounts! If the vote goes against him and Attanasio asks for his loans back as soon as possible, will the club be solvent? 🤷

On the other hand is Attanasio a benevolent person, rolling up interest and not seeking repayments to assist the club to operate soundly? If so it would go against the reason many critics gave for the sale of Omo!! But what is all that cash being used for?

Then there is the question of who exactly is backing Norfolk. Yes, we know of Attanasio and Ressler, but they only own 83% of it, who are the other minority interests (the US individuals / trusts / corporates)? I feel a little short changed by the paperwork that I now have to spend time on the Internet in this glorious weather (how do you do it Purps?) to try and ascertain this. But Attanasio is in overall control!

And, just who is going to chair the GM? I'd like to know who I am addressing my proxy votes to!

In short, there are many questions I'd still like answered, mainly around financials, what has happened definitively plus governance issues. I do not think the paperwork tells the full story, but also I don't think what I don't know changes how other people should vote, its just my personal curiosity. There remains just one show in town.

OTBC 

Hi Shef, I've now got access to my computer and tried to crunch the numbers on the financing. My reading of the documents of the figures are different to yours. I'm not sure if it's because I'm missing something (refs in [ ]). My reading is that Norfolk has provided £33,637,200 of financing to the Club since the C Pref / Share purchases [Circular: page 8]. I have this as:

- First Promissory Note 14/12/22: $2,109,360 (balancing figure FX rate: 1.55 USD/GBP) [Term Sheet: 3]

- Second Promissory Note 19/12/22: $7,692,300 (balancing figure FX rate: 1.55 USD/GBP) [Term Sheet: 4]

- Loan Agreement 20/01/23: £1,634,700 [Term Sheet: 8]

- "Relevant Loan" 20/01/23: £4,682,800 [Term Sheet: 9]

- Line of Credit 20/03/23: £21,000,000 [Term Sheet: 14] (assume available as Relevant Loan provided, i.e. Ecotonian Financing did not arrive, but may have not been drawn)

Total: £33,637,200

Then total cost of ordinary share purchases: £3,317,425 (132,687 shares @ £25).

Then C Preference Shares: £10,000,000 (10,000,000 shares @ £1).

Total spend: £46,954,625 = £33,637,200 + £3,317,425 + £10,000,000.

Are you saying that Mr Attanasio has extended further financing in his own name beyond that above? The Promissory Notes, Loans and Line of Credit has been provided by Norfolk according to the Term Sheet. Otherwise, I'd get nowhere near the £70m that you refer to. 

I'd be grateful for your thoughts!

[GMF 756]

@MrBunce reference the Term Sheet, Clause 9), is this giving the Club the choice between

a) repayment of Loan Agreement £4,862,800 times 2 = £9,725,600 or;

b) capitalising the Loan Agreement £4,862,800 in exchange for 194,512 ordinary shares at £25.00 each

Both these options becoming repayable on the 6th February 2023, some 17 days after the Loan Agreement was granted? 

[essex canary 505]

3 hours ago, GMF said:

MA is legally entitled to interest at the prescribed rate, as are all other preference share holders. Whether he elects to take it, is a different matter.

Could it be argued; by you, yes, by others, probably not. 

Except that his interest rates haven't been made available to others.

[GMF 756]

5 minutes ago, essex canary said:

Except that his interest rates haven't been made available to others.

Shareholders approved a resolution to be excluded from C-preference allotment process at the general meeting last September. Your observation in this context is, therefore, I’m afraid, completely incorrect.

[MrBunce 245]

35 minutes ago, GMF said:

@MrBunce reference the Term Sheet, Clause 9), is this giving the Club the choice between

a) repayment of Loan Agreement £4,862,800 times 2 = £9,725,600 or;

b) capitalising the Loan Agreement £4,862,800 in exchange for 194,512 ordinary shares at £25.00 each

Both these options becoming repayable on the 6th February 2023, some 17 days after the Loan Agreement was granted? 

Yes. Thus my reference to the 'ultimatum' - if the waiver is not granted, the loan won't be capitalised and therefore the Club will have to pay back £9.7m. Effectively asking 'mom and pop' investors to give up their rights or the club financially suffers.

The repayment date was extended as set out in the Relevant Loan Agreement to September 2023 and further in the Amendment to February 2024.

Now if you want to really put your tin foil hat on, note that: the Term Sheet makes no reference to the necessity of the Takeover Panel Waiver and in 10(d): "Delia/Michael shall vote in favor of any such shareholder resolution to give full effect to the Proposed Share Issue and, together with the Club, shall use best efforts to procure other shareholders of NCFC vote in favor of the relevant shareholder resolution". Emphasis mine.

[wcorkcanary 4,337]

15 minutes ago, GMF said:

Shareholders approved a resolution to be excluded from C-preference allotment process at the general meeting last September. Your observation in this context is, therefore, I’m afraid, completely incorrect.

Why  am I not remotely surprised by this? 

[shefcanary 2,446]

1 hour ago, MrBunce said:

Hi Shef, I've now got access to my computer and tried to crunch the numbers on the financing. My reading of the documents of the figures are different to yours. I'm not sure if it's because I'm missing something (refs in [ ]). My reading is that Norfolk has provided £33,637,200 of financing to the Club since the C Pref / Share purchases [Circular: page 8]. I have this as:

- First Promissory Note 14/12/22: $2,109,360 (balancing figure FX rate: 1.55 USD/GBP) [Term Sheet: 3]

- Second Promissory Note 19/12/22: $7,692,300 (balancing figure FX rate: 1.55 USD/GBP) [Term Sheet: 4]

- Loan Agreement 20/01/23: £1,634,700 [Term Sheet: 8]

- "Relevant Loan" 20/01/23: £4,682,800 [Term Sheet: 9]

- Line of Credit 20/03/23: £21,000,000 [Term Sheet: 14] (assume available as Relevant Loan provided, i.e. Ecotonian Financing did not arrive, but may have not been drawn)

Total: £33,637,200

Then total cost of ordinary share purchases: £3,317,425 (132,687 shares @ £25).

Then C Preference Shares: £10,000,000 (10,000,000 shares @ £1).

Total spend: £46,954,625 = £33,637,200 + £3,317,425 + £10,000,000.

Are you saying that Mr Attanasio has extended further financing in his own name beyond that above? The Promissory Notes, Loans and Line of Credit has been provided by Norfolk according to the Term Sheet. Otherwise, I'd get nowhere near the £70m that you refer to. 

I'd be grateful for your thoughts!

Ah ha. I think my reconciliation was motivated to try and attempt to support Paddy Davitt's comment in his "explainer" on the deal on the table that Attanasio had contributed £70m! I think as Purps has reported elsewhere I may have over thought this. It looks like I have double counted due to different dates being attributable to to the same loans. I can see this more clearly now from the work you have done.

My oversight has been that £33,637,200 was made available on 13/9/22 at the time of the first GM, whilst there was then mention of £27,495,500 being made available on 20/1/23, which I took as a completely new loan. From your work I can see that this figure is actually part of the £33,637,200. 

So, if the waiver is passed, Attanasio will pay out £8m for his 40% of shares, whilst providing loan finance (which may or may not have all been fully drawn) of £39m. Why Davitt has mentioned a figure of £70m I am now further from understanding, but presumably he picked this up during his briefing? If only some interim accounts, or draft year-end financial figures had been provided, my confusion would not have occurred.

[essex canary 505]

1 hour ago, GMF said:

Shareholders approved a resolution to be excluded from C-preference allotment process at the general meeting last September. Your observation in this context is, therefore, I’m afraid, completely incorrect.

Collectively they did. Individually I voted against and as such I stand by my original words. A different issue for those who have some or even significantly more skin in the game. 

Perhaps awkward now given that some people will already have voted. Nonetheless in principle my original suggestion was, or perhaps ought still to be based on my next post, a perfectly viable way forward?

[GMF 756]

@shefcanary and @MrBunce I’m not clear where you’ve picked up your US $ conversion rates, at $1.58 and $1.55 respectively, but, in the context of the wider picture, it’s clearly unhelpful that some of the loans are referred to in $US and others in £GBP.

Anyway, in an attempt to distill this down, it seems like there’s four loans outstanding, plus a credit line with a spend limit of £21m, albeit no indication of the extent of the drawdown. This drawdown facility has a maturity date 1/9/23.

1. First Promissory Note, dated 14/12/22, expressed at US$ 2,109,360. No redemption date specified.
2. Second Promissory Note, dated 19/12/22, expressed at US$ 7,692,300. Again, no redemption date stated.
3. Loan Agreement £1,634,700, dated 20/1/23. Maturity date 1/9/23. Interest at 11% (compounded monthly).
4. Loan Agreement £4,862,800, also dated 20/1/23. Maturity date 6/2/23, some 17 days later. This has two repayment options (mentioned in my previous post). Twice the loan amount, or capitalisation for 194,512 ordinary shares at £25.00. This is the Relevant Loan for the purpose of subsequent documents, as others have mentioned.

 The Senior Unsecured Promissory Note, dated 9/6/23, is expressed in US$ 6,020,146.41, and seems to relate to the Relevant Loan (4 above). This extends the maturity date to the 1/9/23, however, there’s a Relevant Loan Amendment Agreement, dated 21/8/23, extending the maturity date to February 2024, as confirmed by @MrBunce above.

The Terms Sheet also confirms that the First Promissory Note, the Second Promissory Note and the Loan Agreement, dated 20/1/23, were due for repayment on 1 September 2023.

There’s no clarity on these loan repayments, or the extent of the drawdown on the Credit Line. However, it seems that the self funding mantra, the underlying tenet of D&M’s reign, is well and truly “in the bin”. A parting “gift” from our mountaineering SD, perhaps? 

 

[essex canary 505]

3 hours ago, PurpleCanary said:

Shef, forgive me, but you may be over-thinking this!😍 I suspect the Takeover Panel accepted Smith and Webber as independent directors solely because they are not part of the concert party of what are regarded as dependent directors.

But that is purely legalistic. They are not independent directors in the way you and I would understand the term. I don't think Norwich City have ever had any independent directors. 

But leaving all that aside, the broader point is that the Takeover Code calls for the publication of independent analysis/assessment/advice, And for that to means what it says it has to come from outside the club, not from two directors, whatever their legalistic status.

That being the case implies that the homework hasn't been done correctly. 

Therefore why not halt the process and go back and do the homework again then table the proposals again with extra background information or reassurances or policy changes?

Embarrassing! Then again just be embarrassed and work for a positive vote.

As it stands @MrBunce has made a strong case for voting against which from an assurance perspective is the best advice for minority shareholders from their own perspective.

 

[king canary 7,665]

Every now and then I open this thread, read the obviously very thoughtful posts with lots of important info, stroke my chin and react like this.

 

[nutty nigel 7,607]

19 hours ago, MrBunce said:

This leads me to my conclusion on the matter. I, like @shefcanary, trust Attanasio. However, for me that is not enough to vote 'yes' to a proposal that would effectively spell the 100+ year fan ownership of the club I support.

 

This is me in a nutshell. I trust Michael and Delia to do the right thing. But they can only do the right thing for now. The fan ownership has always been a massive thing. And the local businesses have always supported our club as have the council. But of course football has outgrown such things as we see with the old Trust shares now gone. ECN shares now gone. The days of Lord Mayors being able to save the club are gone for now. When this goes through they're probably gone for good. One of my favourite quotes is from when Sir Arthur South took the reigns from Geoffrey Watling. Sir Arthur said 'the fans say Watling out but I say Watling in." He knew they'd be stronger together and in 1996 we were all pleased that Watling had stuck around.

So football moves on towards the money at an ever increasing rate. We are late to the party in some ways but we are a stronger club for that. But the global game will sooner or later leave England. We have no right to keep it with the top clubs being owned world wide. Then will an American still want to own Norwich City. As we've said before it will be the next sale where we have no say and no fans to trust. But then when the bubble bursts fans could end up buying our club back. I'd like to think so...

I'm glad you stuck around @MrBunce. Arrdee will be looking down on your posts with pride telling everyone that you are one of his top PUPs.

Edited September 13, 2023 by nutty nigel

[hogesar 9,736]

18 minutes ago, king canary said:

Every now and then I open this thread, read the obviously very thoughtful posts with lots of important info, stroke my chin and react like this.

 

Ha! But you're an intelligent poster, if in particular you read the bits from Purple, Shef and GMF you can get a decent overview (admittedly i'd have to read them all a couple of times).

Attanassio is definitely getting a good deal and I'm not sure with how much intent but seems to have manufactured a scenario where there is little choice moving forwards. But that's as much down to our current owners as him.