Festival creditors will be lucky to get a pittance
My biggest gripe is that (festival organisers) knew, weeks out, that it was never going to work. CREDITOR
SHATTERED suppliers of the failed Grass is Greener festival have been told they’ll get as little as three cents for every dollar owed, despite festival money being used to prop up struggling restaurants owned by the organisers.
The company behind the festival, Hand Picked Events and Marketing, went into administration on December 8.
Contractors, suppliers, and other creditors from Cairns to the Gold Coast – together owed as much as $3.9m – were told the festival handed out more than $760,000 in interest-free loans to restaurants linked to its director Oliver Fines-Frost, also known as Oli Frost, and cofounder Jonathan Eddings, originally from Cairns.
But the businesses which received the funds will never have to pay them back after creditors have now voted to sign a deed of company arrangement.
Under the agreement, Hand Picked Events and Marketing will not go into liquidation and will be allowed to continue to trade.
Mr Fines-Frost has 90 days to pay $200,000 into the administration account which, if paid, would still leave a multimillion-dollar shortfall for creditors.
The report revealed festival organisers were in discussions with administrators more than a month before its collapse.
“My biggest gripe is that (festival organisers) knew, weeks out, that it was never going to work,” one creditor,
who voted against the arrangement, said.
“Now I’m flat broke, so how am I going to fund a case against them?”
For a resolution to be passed at a creditor meeting, it must be voted in by at least half of the creditors, both by number of creditors and amount owed.
The administrators said “disputes over several creditors’ claims” meant the total amount owed by the company could be anywhere between $2.1m and $3.9m.
They recommended creditors vote in favour of the company arrangement, saying
it would leave them better off than if the company was liquidated.
Of the 1035 known creditors, just 18 dialled in to the meeting. Voting in favour of the arrangement were 12 creditors owed $2.09m, while six creditors owed a total of $319,700 voted against.
The report said the festival, which was founded in Cairns by Mr Frost and Mr Eddings, borrowed money from ticketing company Eventbrite to sustain it during the planning phase of the 2019 festivals. They are funds the administrator said were almost gone when it went into administration.
It turned a profit of $364,000 in 2019, but its fortunes changed in March 2020, when government restrictions on large eventscrippled the industry.
After restrictions were lifted in 2021, the company “invested heavily” in expanding Grass is Greener to Canberra and Geelong, borrowing more money – this time $2.5m from UK-based Festicket.
While ticketholders were told Festicket owed the festival money, the opposite was the case.
According to the administrator, organisers incurred
more than $4.3m costs securing artists and venues, with more than half required upfront.
They then made $2m less than they expected in ticket sales and cancelled two new shows. The company attempted to trade out of its financial difficulties and secured a loan for $1.25m from DN Holdings. However, this amount was not sufficient to cover the ticket sales shortfall and the company began receiving statutory demands from its trade creditors. The report said the cost to hire acts for the festivals quadrupled between 2020 and 2022.