SHAREHOLDERS of a North Yorkshire auction mart have agreed measures to pay off debts of more than £300,000, which could help secure the long-term future of the business.

A rights issue of shares scheme was overwhelmingly supported at the annual meeting of Hawes Auction Mart, on Wednesday.

Existing shareholders will now be offered the chance to buy one share for each ordinary share they own, at a cost of £400.

With 840 ordinary shares issued, the scheme could raise up to £336,000. Directors say the scheme is vital to secure the future of the mart.

Last year, the mart ran into serious financial difficulties when the Dales Quality Meat Company (DQM) went into administration.

The firm, launched by the mart, in 2001 was intended to secure a brighter future for farmers in the area in the wake of the foot-and-mouth crisis.

Speaking after the meeting in Wensleydale Pantry, Hawes, director Andrew Pratt said: "We set out at the annual meeting a resolution for a rights issue that was overwhelmingly passed, almost without any objections.

"At one time, the future of the mart looked a bit bleak.

"Hopefully, if the shareholders back the rights issue to the extent they did at the meeting, we can move forward."

In a letter to shareholders, mart chairman Roger Scarr said: "Because of the failure of DQM we have been left with more than £300,000 of debt to service and repay over the next nine years. 2006 proved the core business is profitable to the tune of about £18,000, if we adjust for depreciation and exceptional professional costs."

Mr Scarr added: "By raising sufficient capital to pay off the loan, this would enable us to be rid of the mortgage which covers the mart premises. This, in turn, would mean that the value of the property would be returned into the hands of the shareholders."

Mart directors say plans to develop a visitor centre at the site in Burtersett Road have been abandoned.

At the annual meeting, Wensleydale Creamery production director, Alice Amsden, was appointed as the mart's first female director. Two other new directors, David Harker and Jack Wade, were appointed.