REBOUND PLAN FOR BLAZE’S $12 MILLION DEBT
Written on the 14 June 2012
THE financially-stricken Gold Coast Blaze basketball organisation has been thrown a lifeline after creditors today agreed to a deed of company arrangement (DOCA).
The business, which went into voluntary administration last month, owes more than $12 million, administrator Roland Robson, from Aggs Robson, revealed today.
Under the DOCA, which provides an avenue to trade out of financial trouble, priority creditors will receive 73 cents in the dollar.
Unsecured creditors will get just 7 cents per dollar of debt, says Robson.
Under the DOCA, Blaze owners Owen and Katie Tomlinson have been given 21 days to inject $300,000 into the company, he says.
Robson says former Blaze coach Brendan Joyce, who won a Supreme Court judgement against the organisation over his dismissal, will be offered around $30,000 of the $310,000 he was awarded by the court. The full amount is about $560,000.
A legal spokesman for Joyce, who was at today’s DOCA announcement, indicated that offer would be challenged.
Basketball Australia acting CEO Scott Derwin says the Blaze will have about one month to seek inclusion in the next season of the national competition, which starts in October.
Derwin says the organisation must find a new investor and prove it has the backing to finish the season.
“We will need to sit down with the administrator and the owners of the Blaze and talk to them about their budgets and their funding. We need a strong assurance, through guarantee and otherwise, they have that ability to start and finish the season,” says Derwin.
Robson says Blaze still has four athletes under contract who will continue to be paid undisclosed amounts.
Uncontracted players, like foundation player James Harvey, who attended today’s announcement, have not received their full entitlements.
Owen Tomlinson (pictured) used the DOCA announcement to apologize to creditors and investors, who include Gold Coast mayor Tom Tate.
“I am certainly upset by the fact people lost money,” says Tomlinson.
“We are trying to go ahead and keep negotiating with a party that has shown an interest and wants to help support us.’’