Look the other way: fixed and floating charges


Yesterday Graham Wallace, Norman Crighton and Sandy Easdale offered to giving a legal undertaking be security would not be given over Ibrox and Murray Park in return for a loan.

Security over a property asset is only one way for lenders securing that asset, it is not the most popular, or even necessary, for the lender to control assets.  More commonly, a lender will require a floating charge over the assets of the company.

A floating charge ‘floats’ over all assets of a company until it is discharged by full payment, or it converts into a fixed charge over whatever assets the company has at that point in time.  This is usually due to a payment default, but can also be triggered by a weakening in one of the company’s trading indicators (say, poor season ticket sales).  A company can only issue one floating charge over all their assets at a time.

If you get a bank loan for a value which is significant to your size, you’re almost certain to sign over a floating charge over the assets of your company, no matter how good a trading record you have.  This is true for Celtic and Manchester United, and would absolutely be true for Newco Rangers.  Stakeholders at Celtic and Manchester United would not bat an eye at this, as there is zero chance of them defaulting.

It would simply not be possible for Newco to secure a significant amount of conventional borrowing without granting a floating charge.

With the floating charge in place, no other creditor can step forward and make a claim on the assets until the secured creditor is satisfied.  In many circumstances, lenders will prefer a fixed charge, as it prevents the borrower from selling key assets before an insolvency event.  With a floating charge, Newco could still sell Ibrox under the nose of the lender and fans alike.

In the event of an insolvency event, the floating charge becomes a fixed charge over whatever assets the sheriff officers can find.  In terms of Newco Rangers this would mean the stadium, training ground, the bike, loving cup, a hundred weight of marble, balls and stripes.  Ebay would be interesting when that lot was uploaded.

Perhaps this is why Celtic have hidden Lennoxtown up a country lane.  “No training ground here, mister, it’s just a field.  I wouldn’t take that car across those potholes.”  Peter’s not daft, you know.

For Newco, giving a legal obligation that the company will not provide a fixed charge over property assets is, quite literally, not worth the paper it is written on, without also committing not to provide a floating charge over all the company’s assets.  It would be “We promise not to give security over only some of our assets, if we give security, it’ll be for everything”.

Legally prohibiting your company from providing a lender with a floating charge also prohibits you from accessing conventional lending.  It would be ludicrous, and could only be considered if the alternative would bring the wolf to the door immediately, in other words, it might bring in season ticket money, but it would ensure an almighty crash as soon as the ticket money is consumed.

For well over a decade the various episodes at Ibrox have been an exercise in making people look the other way while dirty deeds are done. Still, the world’s Gullible Champions show no sign of figuring out what’s going on.  After season ticket money is banked, keep your eye on the floating charge.

The fate of whatever football team plays at Ibrox was set in a firm direction when Rangers incurred unsustainable debts.  As a consequence of this, their majority owner sold his shares to a liquidation expert.  The train was in motion long before May 2011.

Instead of asking Rangers International for a meaningless commitment, an acknowledgement of the situation should be made.  Reality is:

Key assets cannot legally be put beyond the reach of creditors.

The directors must legally look after the interests of shareholders – or be liable for their losses.

The club has a massive trading deficit to fill next year, the year after, and probably in many subsequent years.  Estimates of this being between £30m and £50m only acknowledge the next few years deficit.

There are no good choices now, only less bad ones.  It would cut ‘Rangers’ fans to the core to become tenants paying a high rent for the use of Ibrox, but flogging this asset might secure them enough cash to reach top flight football – and there is nothing whatsoever fans can do to blackmail the club into retaining this asset.

Whether they consider Newco to be the same club or not, future ‘Rangers’ branded teams will be nothing like those of the past.  There is a possibility they will have a team to support, but it will not be a Champions League team, and Ibrox might not even be the best place for it, a St Mirren Park-type venue, packed out every week, would at least allow them to pay their bills.

The Sevilla keeper moved.  Three referees watching.  Three referees!  Two on the line, whose only job was to check if he moved!  Last night I considered corruption was at play but there is another possibility.  Calling out the keeper was a huge moment for the assistants, each of whom may have preferred one of the other two referees make the call.  It would have been a huge call for the main referee, too, but he could have deferred to his assistants, who were in prime position.

Without clear responsibility, all three were frozen in silence.

Tommy Gemmell is on CQN tomorrow from 13:00 – 16:00.  Tune in and have a ‘chat’.  You can order his autobiography, All the Best, due out next week, from the link below.

Select Maiing Destination

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  1. twentyfirstofmaynineteenseventynine on

    Beatbhoy, that Belgian Beer wall looks excellent, wouldnt rate its chances of surviving in Glasgow for more than 2 mins though

  2. Richie #TeamOscarForever on

    Sammi didn’t sound like a guy who was holding out for money. Another made-up myth that has never been confirmed by any source. Listen to him talk from the heart.

  3. richie #teamoscarforever



    15:19 on 15 May, 2014


    Sammi didn’t sound like a guy who was holding out for money. Another made-up myth that has never been confirmed by any source. Listen to him talk from the heart.





    First viewing for me and have to agree.

  4. Gene's a Bhoy's name on

    Sad news about the legend who is Danny McGrain


    Best wishes for a speedy recovery

  5. !!bada bing!!



    14:45 on 15 May, 2014Embdae switched line rental/broadband fae Sky to BT ?If so,any difference? Ta






    I switched last year, bt dealt with sky and the football channel came on within a couple of minutes.



    Oh and the broadband is fine as well ;)

  6. !!Bada Bing!! on

    Richie -agree,some a bit quick off the mark with that one,some forget he dropped £1.2 mil on his Man City contract to sign for Celtic.

  7. Twentyfirstofmay1979



    It’s toughened glass. . . .but probably not tough enough!!

  8. !!Bada Bing!! on

    TBB/Sipsini – thanks,BT still got free sports channels next season too.HH

  9. Baseball is one of the only games not run by time or a clock, there has to be a winner, many many games pass the ninth inning it’s one of the most interesting games in sport, like when a pitcher, pitches a no hitter it’s very exciting, but like most games if you don’t know the rules it’s boring, I learned that when I lived in Canada, because all you got was North American Sports on TV, Baseball, Ice Hockey, NFL, .. Basketball I never got into, the rest I did and of course after a time you get into it, what you had to do was pick a team, Ice Hockey I picked The Toronto Maple Leafs, ( last time they won the Stanley cup was in 1967 so a no brainier there) baseball Toronto Blue Jays, (local team so why not) NFL Philadelphia Eagles ( played in green an white) I suppose it was a case of if that’s what you have make the best of it, and it did I loved it, to this day I look for the scores and stay up at all time s at night, well don’t have to stay up to all times now, I record it and watch it in the morning the next day, PS team rivals I hated baseball NYY, Ice Hockey Montreal, NFL, Dallas Cowboys.

  10. richie #teamoscarforever



    15:13 on 15 May, 2014





    Thanks mate.



    Sammi is a class act.

  11. Paul67 et al



    Well the “referees” certainly looked the other way when the penalties were being taken, if not before. Still got their medals though, (all six of them), and I have got to admit that I do not know how long that has been going on. Certainly there are more than a few Scottish referees who earned them even if they didn’t get them. Maybe one day a whistleblower will er blow the whistle on those dirty deeds. Done dirt cheap.



    Best wishes to Danny McGrain on his recovery.

  12. aikibhoy



    15:22 on 15 May, 2014


    Sammi said it straight.



    “Other people make the decision for my future. I have to accept that”





    Sums it up perfectly.

  13. Richie #TeamOscarForever on

    From the Irish Post:



    Selling Samaras over Lennon’s head would be a grave error


    By Richard Purden on May 15, 2014





    GEORGIOS Samaras delivered the biggest surprise of the week when the striker stated he did not wish to leave Celtic.



    In a post-match BBC interview he said that it was neither Neil Lennon’s nor his own choice for him to leave Parkhead, suggesting the move had been enforced by Peter Lawwell.



    “It was not the manager’s decision,” he said. “It was people from on high. I never had an offer from the club. I never had an offer from Peter Lawwell.



    “I was full of respect for Celtic. I have not signed for any other club, I have not spoken to other clubs. I was waiting until the end to see if they made me an offer, but I think that’s the end.



    “I cannot lie to the people. I had a chat with the manager. He would have loved me to stay at the club. But me and the gaffer, we don’t make the decisions — there are people above us who make the decisions and they never approached me.”



    It was only the season before last that Samaras became the first player in Celtic’s illustrious history to score in five consecutive European games away from home. The Greek international’s understanding of what it means to play for Celtic is clear and to discount that mentality and experience next season is a grave error.



    Meanwhile, Celtic look set to offer Kris Commons a new contract. The player picked up a well-deserved Scottish football writers’ player of the year award last week. However, domestic eulogies tend to have a shrivelling effect when tested in Europe, particularly in the group stages of the Champions League where his limitations become clear.



    The loss of Gary Hooper, Victor Wanyama and Kelvin Wilson last summer neutered European hopes which were depleted further when captain Scott Brown was served with a three-match Champions League ban for his kick at Barcelona’s Neymar during a discouraging campaign.



    When Celtic finished bottom of Group H in the Champions League it was in stark contrast to the season before where they entered the knock-out stages against Juventus. Despite the 3-0 defeat most fans were positive about the team’s overall performance as this was the most convincing European side in nearly a decade.



    With Norwich’s relegation confirmed the return of Gary Hooper would be welcomed, his former Celtic teammate Kris Commons said: “In an ideal world I would like to get Hoops back. I had a very strong relationship with him on the park. He is one of the best players I have ever performed alongside.



    “I don’t think it is totally unrealistic that we could get him back one day. It would be magic to have him in our side again. Look at the amount of goals he scored. In addition, his movement and link-up play were second to none.”



    Celtic clearly lack a striker that defenders dread, what’s needed is a proven force who can settle in quickly. Lennon didn’t rule out the option of Hooper’s return: “I’d imagine the Hooper thing would rumble on but whether we could tempt him back or not I don’t know. ‘I don’t like talking about a player who’s under contract at another club. But we think very highly of Gary, put it that way.



    Anthony Stokes is currently enjoying convincing form with his new strike partner Leigh Griffiths but it remains to be seen if the pair can replicate their success in Europe.



    Both players have recently made headlines for behaviour off the park, but Lennon was philosophical when asked about it: “Sometimes I think these stories are blown way out of proportion. They are not bad boys and people try to make them out to be something that they are not.



    “They are a bit loose sometimes but I like that in their personalities, as long as we can channel it in the right directions. I will wait and see what the police investigation brings for Leigh.”



    Between now and the Champions League qualifiers Neil Lennon will aim to secure funds to sign a centre forward while recruiting a new No 2. Despite constant speculation it is hoped Virgil van Dijk and Fraser Forster will remain at the club, there’s no doubt the side is strengthening and the hopes are great for players such as Stephan Johansen who has become an automatic first choice in midfield after making an influential mark on the team since January.



    Domestic games at Celtic Park now bear the stamp of a testimonial atmosphere, with that in mind it’s understandable that Lennon has made it clear Europe is the goal for next season.



    When Lennon was asked about Balde, Boerrigter and Teemu Pukki this season, he agreed with many supporters when suggesting their time at Parkhead had been “disappointing”, before adding “Teemu has got better as the season has gone on.



    “Amido will probably say that he hasn’t had enough game time. “Derk has been littered with injuries. They will maybe think that they haven’t had the opportunity but they must do better.”



    Both Balde and Boerrigter were given starts against St Johnstone last week, despite excuses these players and others clearly lack what it takes to break into a top Celtic side, Peter Lawwell should consider what Samaras could do for the team next season before he allows him to exit Glasgow as a Celtic player for the last time.

  14. !!Bada Bing!! on

    Lady singing Amazing Grace ,as a tribute to her husband who died at the Twin Towers,at the opening of the 9/11 Museum……..wow,what a voice.

  15. Richie #TeamOscarForever on

    Young bhoys leaving CP, from the official site:



    Academy confirm young players to exit ParadiseBy: Mark Henderson on 15 May, 2014 13:37



    CHRIS McCart admitted it was a difficult decision to allow a batch of players from Celtic’s Youth Academy leave the club this summer.



    Patrik Twardzik, Michael Miller, Lewis Kidd, Paddy McNally, Jack Kirwan, Sean McIntosh, Steven Boyd, Aaron Comrie and Connor McLaren will exit Paradise once their contracts expire.



    The youngsters were part of the Development Squad and the Under-17s, helping both teams achieve significant success over the past 12 months.



    However, Celtic’s Head of Youth told the official Celtic website that letting them depart for fresh pastures was in the long-term interests of the players and club.



    “We have let all the players know who is getting let go,” he said. “From our Development Squad we had to make some tough decisions as we had some fantastic players there and their contribution was excellent.



    “We have let go Patrik Twardzik, whose contract will expire on June 30, along with Michael Miller, Paddy McNally and Lewis Kidd.



    “From the younger age group, Jack Kirwan, Sean McIntosh, Steven Boyd, Araon Comire and Connor McLaren will also go.



    “Every club has to deal with this and it’s not unique to Celtic – you bring new players on and you have to let certain players go.



    “These players are of an excellent standard, and some are current internationalists, but we have to leave space for the younger ones coming through and keep that pathway free.



    “We also want to be true to these players as well, instead of keeping them on. We don’t want to keep them on to win an U20 title or Youth Cup.



    “For their own development, we want to make sure they get an opportunity to go and play first-team football elsewhere.



    “Hopefully they have enjoyed the experience and benefited from their time at Celtic and we wish them well.”

  16. TD67



    Same for me really. Yank sport was all you got on Middle East TV, mostly nfl.



    Always had a soft spot for the Saints…. Maybe it was an affinity with the brown paper bag!!



    No other favs, just the underdog.

  17. twentyfirstofmaynineteenseventynine on

    Danny will put this behind him, as he’s done with everything else he’s faced. One of the best players Ive had the pleasure to watch and I even remember him scoring at Boghead years ago with one of his famous thirty yarders.



    Get well soon Danny Bhoy

  18. Richie


    at 15.19



    Sammi, if He Leaves.. Is Leavin’


    Fur a Reason.



    n.. Wan … disnae tak a Mental Gian, tae figger oot.. Whit



    That reason is ..



    Sammi n Celtic..



    Are NO Enjoyin’ …During, HIs Contract Negos .. wan of they “Meetings o’ the Minds”.. that Everybuddy hiz Hoid O’.






    Naturally, when that “Meetin'” Fails Tae Materialize.. They Baith will Hiv a Parting o’ the Ways.



    Sammi, wull then Leave.



    These thing Happen.



    Sammi ,is No A Bad Guy.. Neether is .. Mr. Lawwell.



    That’s Jist Bizness.






  19. traditionalist88 on

    ‘These players are of an excellent standard, and some are current internationalists, but we have to leave space for the younger ones coming through and keep that pathway free.’






  20. Bada bing.



    Switched 2 wks ago.


    Got infinity, downloads hd in seconds.


    Very impressive.


    What I am saving on bt sports virtually covers rental.



    A recommend.



    Big sean.

  21. “Tha’ boattum line is……………………………….


    …The Big Hoose wull be rentit!”



    *shakes jowls defiantly*







  22. jude2005 is Neil Lennon \o/ on

    B B



    Enquired but B T dont give the same service to my Tivo box in the bedroom. So me and mrs j wd be battling over the remote again. Not a pretty sight btw!!!

  23. Tony Donnelly



    at 15.26






    Nice tae greet ye..



    Yes.. Ah thoroughly Agree wi ye..



    Baseball, is a Great Game!… tae watch.



    N .. Any time that Ah dae So.. Ah find that It is Actually.. A Real INTELLECTUAL WORK-OUT..



    It is a Thinkin Man’s Sport..



    Ah am afraid, though, that It wid be a very Hard Sell..


    tae convince Maist Scottish Soccer Aficionados … that is is… that.



    Fur.. The Sorta Entertainment that wan Derives fae watchin’ a Soccer game,


    is Entirely Different.. from The Kinda Entertainment that wan Derives fae


    Watchin’ a Baseball game.



    Kippers n Custard!



    The L.A. Dodgers ur Ma Favorites..



    Ah Luv ..”Da Bums.” aloater.




    Nice Chattin’,pal






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