The Jags Foundation welcomes the publication of the Memorandum of Understanding entered into between the PTFC Trust and the Club.
We make the following observations.
A departure from best practice
Firstly, this arrangement differs significantly from the arrangements in place at other Football Clubs that are fan-owned.
A memorandum of understanding provides no legally enforceable guarantees if terms contained within it are not adhered to.
Problems with a non-legal agreement
So, for example, the provision that says that the Trust “will be made aware of any plans to spend over £150k on a single item” cannot be enforced. Nor can the provision claiming to give the Trust a “right of veto over any sale of the land or property at Firhill”.
While it might be good governance to fully involve the majority shareholder in those decisions, there is in fact nothing in this arrangement to guarantee it.
On the contrary, the Club Board would still have full power to sell any land or property at Firhill.
No protections against secured borrowing
We also note, for the sake of completeness, that the Memorandum makes no reference to a role for the Trust in the event the Club seeks to take out secured borrowing.
This is a far more likely scenario, where the majority shareholder should want a clear and legally binding say.
The undertakings are unambitious
Secondly, most of this document is not really a commitment to do anything of substance at all. It is a set of information sharing protocols that barely goes beyond what had been agreed by the original TJF Board back in October 2021. In some respects, it has actually gone backwards, most notably on fan representation.
Fan representation is fundamental
Thirdly, our view on fan representation is well aired. Ideally, there should be significant fan representation on the board of a fan-owned Football Club: especially one where over 80% of the shares are owned by what are meant to be fan-controlled vehicles.
It is frankly not good enough that the PTFC Trust model proposes just 1 Director on a Board of Directors that currently consists of 8 people. This is well below the level of fan representation seen at Clubs with similar or even significantly lower shareholdings in Scottish and English Football Clubs.
We also don’t agree that the fan representation should simply be “a Trustee” – especially given this could mean an unelected trustee for at least the next 2.5 years. We would have expected, some six months on from the origin of these proposals, for there to be a clear agreed mechanism for the vetting, selection and election of fan representatives.
Comparing the Memorandum to the TJF Model
We think it would be useful for fans to see the “Working Together Protocols” that we sent to Three Black Cats in the course of the negotiations over the summer, and which received a very negative reaction from Peter Shand in follow-on correspondence.
That document would have formed the basis of a legally binding document, for an enduring relationship that outlasts individual personalities on the Club and ownership vehicle boards. It would also have had the benefit of aligning with convention.
We would have liked our proposed list of “Reserved Matters” to have been stronger (particularly on financial oversight) but were trying to get a deal that Three Black Cats were willing to agree to, to bring back to our members.
We would also like to note that the previous TJF Board presented a similar, though not identical, discussion document to representatives of the Club Board, shortly before Three Black Cats advised them that they were breaking-off cooperation in April 2022. It too proposed a thoroughly conventional relationship between TJF and the Football Club.
Why publish our Protocols now?
We hope that, by publishing this document, we can show Thistle fans what a “good” working together relationship actually looks like, and where fans should demand more from the Trust and the Club in the coming days and months. After all, this is supposed to be about your shares, and your representatives.
Under the TJF model, the fan ownership vehicle would have been in a much stronger position, but that’s not the whole story. Our proposed legal agreement with the Club would have empowered members of TJF on key decisions, because our own Articles of Association restrict key things that the TJF Board can agree to without first securing the agreement of our members.
The trust deed, by contrast, gives the beneficiaries no real say at all over decisions like the sale of Firhill or disposal of the majority shareholding. The unelected trustees hold that power, subject to their fiduciary duties.
Lack of consultation from PTFC Trust
We should also note that the PTFC Trust did not consult with their beneficiaries in connection with this Memorandum, nor did they seek their approval to enter the agreement.
Furthermore, following the meeting with the PTFC Trust on 1st November, there was a verbal agreement that TJF and the Trust would give sight to each other of upcoming announcements so that there were no “surprises”. TJF gave the Trust sight of both the accounts piece (and offered them an opportunity to influence it), and the recounting of the meeting between the organisations.
We had no advance sight of today’s Memorandum announcement. Accordingly, with regret, the TJF Board believes this verbal agreement is now void.
We never underestimate our members, nor the wider support. We know they can see through things, and we know they will see through this for what it is.
Thank you again for your support, as we build an organisation with more than 900 members.
The Jags Foundation Board