More time given for Knights audit
Heavy hitters … Paul Gallen, Willie Mason, Lauryn Eagle and Greg Bird promoted the Fight for Life boxing event on Tuesday. Photo: Anthony Johnson
THE Knights Members Club has granted Nathan Tinkler's Hunter Sports Group extra time to finalise an audit of Newcastle's NRL flagship after HSG agreed to extend the $20 million bank guarantee that underpins the privatisation agreement.
The Knights chief executive, Matt Gidley, and HSG representatives met with club directors late on Tuesday to discuss critical dates relating to the audit report, due to be presented on Saturday, and the bank guarantee.
HSG had sought to postpone the audit reporting date to February 15 but the members club would not agree unless HSG extended the terms of the $20 million bond until March.
Fairfax Media has been told an agreement in principle was reached on Tuesday in which HSG will present its review of 2012 financial operations on January 21. In return, HSG agreed to extend the $20 million bank guarantee until January 31. That surety was to revert to $10.3 million on January 1, according to the terms of the ownership agreement signed on August 5 last year, but will now decrease on January 31.
Had HSG not confirmed it would provide an audit by an agreed date, or had not extended the bank guarantee, the members club board would have been within its rights to initiate a process to ultimately take control of the Knights and end Tinkler's ownership of the rugby league club.
Gidley and the Knights Members Club chairman, Nick Dan, are expected to make a joint statement on Wednesday outlining details of the compromise, which will allow the members club 10 days next month to review the audit figures and access to the $20 million to make up any shortfall.
''We had a very positive discussion tonight with the members club board and we look forward to making a joint statement some time tomorrow afternoon,'' Gidley said on Tuesday night.
According to the August 5 deed of sale, HSG guaranteed to provide $10 million worth of sponsorship, sufficient working capital for day-to-day football and administrative operations, $2.5 million for junior development, and $300,000 to the Newcastle Rugby League.
It is understood the audit began on Tuesday, and the compromise has effectively bought HSG an extra five weeks to complete this process.
The members club board will then have a 10-day window to ascertain whether HSG has upheld the key elements of the privatisation agreement, and how much of the $20 million needs to be used to make up any deficit in sponsorship, funding or development grants.
Fairfax Media has been told Knights players have been unaffected by the latest wrangle between HSG and the members club, and have been in good spirits at pre-season training.
Meanwhile, Newcastle veteran Willie Mason has addressed the issue of potential strike action from NRL players over future funding - this time relating to the NRL salary cap. Speaking after a news conference to promote the Fight for Life boxing event, in which he, Paul Gallen and Greg Bird will make their debuts in Auckland on Saturday night, Mason raised his concerns over the threat of a player boycott.
The former NSW and Australian forward believes several players who are on the minimum wage ($55,000) will have to find another job if matters over next year's salary cap aren't resolved. ''I don't think [a strike] is healthy for the game,'' Mason said. ''It'll make the game go backwards. It's not like the NFL, which is a multibillion dollar brand. We're not as big as the NFL and the players' association isn't as strong as the NFL and NBA. They can have their lockout system and still get paid millions.
''If we had a lockout system, the guys on $55,000 or $80,000, how are they going to survive? They're going to have to go out and work. Strike action and lockout action isn't going to work because the game isn't big enough to look after players.''
Gallen was adamant players didn't want to boycott matches. ''There's no way in the world players want that,'' the Cronulla captain said. ''We certainly don't want to get to that stage. There certainly hasn't been talk about that.''