The club's chief executive Tim Shaw said that existing directors and current investors had made pledges of £6.3million, but they still had a £3.2million gap.

It's heartbreaking to think that if we don't raise the money we need, Watford FC could cease to exist. But that's how tough it is

Watford's Chief Executive Tim Shaw

He said: "If we can't construct a firm plan to cover the gap in the next few days, the club will unfortunately have to go into administration."

The club has a three-pronged approach to bridge the shortfall - including asking players to take a 12 per cent pay cut. The club also plans a share issue and a fan-led cash-raising campaign.

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And Mr Shaw stressed: "It's heartbreaking to think that if we don't raise the money we need, Watford FC could cease to exist. But that's how tough it is."

Watford's financial problems are a direct result of the demise of ITV Digital and the knock-on effect that has had.

Mr Shaw said: "The trickle down effect of this has destroyed the transfer market and the confidence of any lending institutions in the game. There's also been the problems with the League's Internet deal and the significantly reduced match attendance so far this season to factor into the losses we did not expect."

Players pay cut
He said that players and other staff at the club had been asked to take a 12 per cent cut in wages - which would be repaid, but only when the shortfall is covered."

As supporters know, we have already parted company with some of the highest paid players - most signed last season, but we still need to trim our cloth."

Manager Ray Lewington

The First Division club is also set to have a Save Our Club campaign, working with the newly-formed Supporters Trust.

A further cash initiative will be a share issue, which would go ahead if the club was confident it could raise the full amount of money required. Mr Shaw said: "When the prospectus is issued in the near future, details of additional benefits for investment at different levels will be made available. This will include a place on the football club board."

A share issue took place in August 2001 and raised £4.9million.

Mr Shaw said that the club's directors had raised "substantial sums" already but added: "The directors who have indicated their commitment to invest further significant funds are not likely to be able to make any further investment after this.

"It is therefore vital that sufficient funds are raised to secure absolutely the future financial security if the club as we cannot come back to the well again."

Fans urge unity
Watford's fans said the supporters must band together to save the Hornets from going under.

While Watford Supporters Limited was not formed to finance business as usual costs within Watford Football Club, this is an unprecedented crisis, and one which no conscientious fan can ignore

Watford Supporters Limited

Peter Fincham, of Watford Supporters Limited, said fans should take part in the upcoming share issue, adding: "While Watford Supporters Limited was not formed to finance business as usual costs within Watford Football Club, this is an unprecedented crisis, and one which no conscientious fan can ignore."

Mr Fincham said it was indisputable that the loss from ITV Digital's collapse was £4.3million over two years, plus a £3million loss over two years through the club's inability to raise money through the banks and financial institutions.

He added: "While the club budgeted for attendance losses, the drop in match day revenue was not predicted to be on the scale that match day attendances have indeed fallen. The club accepts that the prices of match day admission need to be reviewed, but already a £1million loss over two years has had to be taken out of the business plan."

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