The Peebles facility has had “significant cash-flow issues” over recent months, with the council agreeing to a £120,000 emergency loan a matter of days ago.
Despite the board issuing a plea for patience last month, it has decided it is in the “best interests of the Eastgate to resign immediately”.
A new board has been established with the aim of steering the hub “from its present crisis of confidence and morale towards a brighter future”.
On Tuesday (September 12), a spokesperson for the outgoing group said: “The board has worked tirelessly and extremely hard to stabilise a really difficult financial situation while trying to develop a sustainable forward plan for the Eastgate.
“Recovery takes time and cannot be achieved in a matter of weeks or months.
“The board’s approach, activities, and plans have [been] met with resistance.
“Additional demands, including from the recently formed Eastgate Partnership, have made attempts to stabilise and develop a sustainable forward plan untenable.
“It was hoped that differing views could be brought together to find a solution and a way forward which everyone could get behind to secure the future of the Eastgate. This has not been possible.”
Tens of people packed the theatre’s main auditorium last month for a meeting arranged by the Eastgate Partnership group – containing friends and supporters of the theatre.
Aside from the financial issues, concerns raised included staff vacancies and the future employment of current workers.
The board spokesperson said changes would be made “as quickly and effectively as possible”.
They added: “The current board wholeheartedly thanks all those who have contributed to and supported their efforts in the past period.
“We wish the Eastgate Partnership, and in particular the staff and volunteer team – who have all worked tremendously hard in keeping the Eastgate going – all the very best going forward.”
Jacqui Naysmith, Frances Swift, Deborah Smith and Helen Lewis were co-opted onto the new board on Tuesday evening, with further members to be announced shortly.
A spokesperson for the new board said: “We recognise the need for a recovery plan that can be shared with the community at an early date.
“The Eastgate board needs to communicate better and would benefit from increased representation from the community in general.
“We plan to set up an online post box and will publicise details within a matter of days.
“The former directors decided to resign en masse immediately after receiving a letter signed by 34 members of the Eastgate Theatre, accompanied by the necessary legal notices. The letter expressed concern about major financial and operational issues that have developed in the past six months, including key staff resigning and essential posts left unfilled, with impacts on programming, marketing, earned income and fundraising.
“The letter also spoke of a lack of creative direction, clear leadership and practical management leading to increased pressure and stress on the remaining staff, and formally requested a general meeting of the company to consider replacing two members of the board to appoint an effective interim manager.”
They added: “We will call a general meeting of all members next month (October) to set out our plans, take questions and ask the membership formally to endorse the new board until the annual general meeting at the end of the year.
“Notices of those meetings will be forwarded to all members.
“Anyone wishing to join the membership register of more than 200 can sign up at the theatre box office.
“The hard work starts here. We need to restore the confidence of staff, volunteers, members and practitioners in the management of the Eastgate Theatre and accelerate applications for the kind of funding essential for all small theatres across the UK.”
The new board is separate to the Eastgate Partnership, which has now disbanded after achieving its aim of securing a public stakeholder meeting last month.
The theatre will start to distribute its autumn brochure next week.
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