Source: Bournemouth_Echo
Cherries: CVA is not the problem
Cherries are honouring their commitments to a group of creditors, ruling out the historical debt as one of the possible causes of the club's ongoing transfer embargo.[LNB] The Daily Echo can today reveal the Dorset club's current owners are meeting their financial obligations to a company voluntary agreement (CVA).[LNB] Cherries were instructed to pay £500,000 to unsecured creditors as one of the conditions for the club coming out of administration in August 2008.[LNB] It was one of the principle terms outlined in a formal agreement offering the club the return of its right to retain membership to the Football League.[LNB] Cherries were granted their share on the eve of the 2008-09 season after the board agreed to the league's exceptional circumstances provisions.[LNB] The club still incurred a 17-point deduction as a punishment for a failure to exit administration in accordance with the Football League's rules regarding insolvency.[LNB] A breach of the agreed CVA payment schedule could adversely affect the club's ability to deal in the transfer market or, even worse, see them thrown out of the league.[LNB] And with Cherries the subject of a strict embargo for almost 12 months, some supporters thought problems with CVA payments could have been behind the ban.[LNB] But when contacted by the Daily Echo last night, Gerald Krasner said the club was on course with the agreed payment schedule. He also confirmed a small dividend had been paid.[LNB] Krasner, who oversaw the club's administration between February 2008 and August 2008, is supervisor of the CVA in his capacity as administrator.[LNB] He confirmed the first two payments of £30,000, due in November 2008 and February 2009, had been made under the club's previous owners.[LNB] And he also said the most recent payment of £146,000, due in August 2009, had also been taken care of.[LNB] The final two payments of £147,000 are due to be made next month and in August.[LNB] Cherries' transfer activity has been closely monitored by the league ever since former owners Paul Baker and Alastair Saverimutto took the club out of administration.[LNB] But while it was initially subject to a rolling embargo with each individual signing requiring league approval the ban was tightened fully almost a year ago after Cherries had signed five players and then struggled to meet its wage bill.[LNB] The club has made repeated pleas for the embargo to be relaxed most of which have been rejected with only two emergency loan signings sanctioned. Their latest request fell on deaf ears earlier this week.[LNB]
