Further to yesterday's announcement and the suspension of trading on AIM the deadline for the repayment of loans to Valley Grown Salads ("VGS") (a company in which Jim and Vince Russo have an interest) of £4.88m is 1p.m. today ("VGS Debt").
The board of Watford Leisure ("Board") has met this morning and considered indicative proposals to save the Company from immediate administration. The Board has resolved to support a proposal from Fordwat Limited of a £7.5 million rights issue of a debt instrument, with either warrants or conversion rights, offered to all shareholders and underwritten in full by Fordwat Limited. This would, at the option of VGS, enable the VGS loan of £4.88 million to be repaid in full with the remaining balance available to contribute to the cash shortfall to June 2010 of £5.5 million.
However for the Board to proceed with this plan Valley Grown Salads would need to suspend its demand for the immediate repayment of the VGS Debt. The Board is therefore in communication with representatives of Valley Grown Salads and a further announcement will be made in due course. In the event that no agreement can be reached with Valley Grown Salads then the Company will have to be placed in administration. The Company's shares remain suspended from trading on AIM.
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