Two former directors of Mansfield Town Football Club are taking legal action against the Sky Bet League Two side claiming they are owed almost £1million in loans.
Steve Hymas and Andy Saunders issued legal proceedings against the club on Christmas Eve last year, seeking to recover £988,441.94.
The claim arises from monies which Mr Hymas and Mr Saunders lent to the club during their period of ownership.
Mansfield Town issued a statement claiming the agreement was for the loans to be re-paid when then club was “in a position to do so.”
But Mr Hymas and Mr Saunders claim the club’s promotion into the Football League last season has given them a significant financial boost.
The Mansfield Town statement said: “The club does not deny that the loans were made, nor that they remain a liability of the club.
“However, as both the club and its lawyers have made clear to Mr Hymas and Mr Saunders, the loans do not have a specific redemption date and are only repayable when both the club and Mr Radford agree that it is in a position to do so.
“Sadly, the club is not in a position to make any such repayment and therefore the monies are not repayable at this time.
“It is disappointing that the actions of Mr Hymas and Mr Saunders will involve further significant legal expenditure by the club in defending the unmeritorious proceedings they have commenced.”
Mr Hymas and Mr Saunders issued a statement which said: “We have in fact refrained from taking legal action for some six months while trying to negotiate an arrangement for repayment of the loans, which became repayable once the club gained promotion and found themselves in better financial circumstances as indeed they are now, benefiting from the funds from the Football League.
“We have never wanted to involve the club in any protracted and costly legal proceedings, but have no option but to do so.”