Investment bank Seymour Pierce claim they will take control of Birmingham City unless £2.2million fees are paid to them before May 27.
Last month, Seymour Pierce, the company chaired by Keith Harris, sued to recover the fee it said it was owed for laying the groundwork for Carson Yeung's takeover of the club.
The company won a court order requiring Yeung to pay by Monday, but as the money was not received Seymour Pierce can now gain a charge of the shares held by Yeung's company, Birmingham International Holdings.
"Seymour Pierce can take a charge over the shares of Birmingham City and do what they need to do with them to recover the money it is owed, so that means they could potentially sell them to another owner," Seymour Pierce spokesman Neil Bennett said on Sky Sports News.
Seymour Pierce had advised Yeung prior to the takeover of Birmingham, but Yeung then appointed a different company to complete the deal.
However, Seymour Pierce successfully argued its contract remained valid and it was owed the money.
Bennett explained: "Seymour Pierce advised Carson Yeung and his company, which was then called Grandtop
and is now called Birmingham International Holdings, a Hong Kong company, and they advised them on the takeover of Birmingham City and they were due to pay Seymour Pierce a success fee for £2.2million.
"They didn't pay it. Seymour Pierce has gone to court , and won the High Court case. The Hong Kong company was given 14 days to pay the money.
"That expired on Monday. They haven't paid so in effect they are in contempt of court and Seymour Pierce has taken the necessary steps to effectively take control of Birmingham City to recover the debt.
"It is very regrettable, very regrettable indeed, that Seymour Pierce has had to go to these lengths to get the fee but a contract is a contract and Seymour Pierce needs to be paid for its work."
Bennett added that Seymour Pierce had done all it could to recover the money prior to taking legal action.
"There have been very lengthy contacts both with Carson Yeung and his legal advisors, but it's sort of past the point of contact," he said.
"The money was due to be paid on Monday. They haven't paid it. They're in contempt of court. It's a serious issue."
The club now faces an uncertain future as Seymour Pierce could put it up for sale in order to recover its money, unless Yeung pays up.
Bennett added: "Everything that Seymour Pierce has done, everything that Keith Harris as chairman has done, in football has been both to promote the industry and protect the interest of fans, so Seymour Pierce will do everything it could to ensure Birmingham City is looked after, but at the end of the day it is owed a significant amount of money and will do everything it can to recover it."
Birmingham are yet to comment, but a statement issued by Birmingham International Holdings said they intended to appeal.
"The company is seeking leave from the Court of Appeal to appeal this decision and there will be an announcement as and when appropriate," the statement said.
However, Bennett sounded sceptical about their chances of success.
"They're on fairly thin ice," he said. "They were refused leave to appeal by the High Court, so to actually appeal they have to first of all get permission from the Court of Appeal to appeal, so that's a fairly convoluted process.
"Whether they're given that permission or not, the money was due to be paid by court order on Monday, they failed to pay it so they are now in contempt, so Seymour Pierce can take a number of measures to recover the money they're owed."
A hearing is now due on May 27 when Seymour Pierce could formally take control of the club.
However, Bennett said there was still time for Yeung to solve the problem.
"This can be resolved very quickly by Carson Yeung and his company sending their cheque for two and a half million pounds to Seymour Pierce," he said.
"Otherwise the process will proceed rather remorsefully, and during the summer break there could be a change of owner at Birmingham City which I don't think would be in anyone's interests."
