Northampton Town: £10m council debt could be wiped out
Northampton Town could be relieved of its £10.25m debt owed to the borough council, after the authority agreed to back a deal to sell the club.
A memorandum of understanding has been agreed between the council and the consortium, led by Kelvin Thomas, which is taking over the Cobblers.
The deal would see the debt wiped out, with the council taking over land near Sixfields for development in return.
The Cobblers owe the council the money over a loan given for unfinished redevelopment work at Sixfields Stadium, and also owes HM Revenue & Customs £166,000 in unpaid tax.
The loan was originally paid to the League Two club for building the new East Stand, along with a hotel and conference centre - none of which have been completed.
The council said the outline agreement signed off by its cabinet would see Thomas's consortium pay off the debt to HMRC and finish work on the stand.
Mary Markham, leader of the council, said: "It is clear that if the club is to survive and have some stability, we have to find a way of repaying the debt.
"This deal puts us in the strongest position to ensure that the public purse is protected."
Northamptonshire Police is investigating "alleged financial irregularities" surrounding the loan to the club.