By Nick Harris
11 October 2010
RBS bank has just released the following statement in relation to the situation at Liverpool and the bank’s High Court action tomorrow against Tom Hicks “and others”. It reveals there is already an interim injunction in place against Hicks and George Gillett, preventing them removing Martin Broughton or other directors from the board.
Given that this injunction has been in place since Friday, it might explain why Christian Purslow was so upbeat yesterday about avoiding administration.
RBS in its capacity as lender to the Kop group of companies received the benefit of various contractual undertakings from Mr. Hicks and Mr. Gillett in relation to the corporate governance arrangements that Mr. Hicks and Mr. Gillett agreed would apply to the Kop group of companies with effect from April 2010.
Those undertakings provided for the appointment of Mr Broughton as chairman of the board and the appointment of the chief executive and commercial director of LFC to the Kop boards.As is well known, Mr. Hicks and Mr. Gillett purported to make changes to those corporate governance arrangements on 4 October. This was in breach of those contractual undertakings.
In light of that purported breach of contract RBS sought and obtained on Friday 8 October 2010 an interim injunction against Mr. Hicks and Mr. Gillett until a further hearing scheduled for tomorrow.
Among other things, that interim injunction prevents Mr. Hicks or Mr. Gillett taking any steps to remove or replace Mr. Broughton from his position as chairman of the board of the Kop companies or from taking any other steps to appoint or remove any directors from the board of the Kop companies.
The proceedings tomorrow represent the continuation of Friday’s proceedings and relates to breach of contract only. These proceedings do not represent steps by RBS to enforce its security or to appoint an administrator.
We are unable to provide any visibility on timing for resolution of these proceedings at this stage.