DRAFT Cabral Brazil Pty Ltd (Administrators Appointed) (“Cabral Brazil”) Reconvened second meeting of creditors 19 March 2015
Agenda Formalities Voting Purpose of the meeting Report to creditors Administrators’ remuneration Future of the company Liquidators’ remuneration Committee of Inspection Comprise debt resolution Questions 2
Formalities Open meeting Administrator Chairman: Corporations Regulation 5.6.17(1) Introductions: Barry Kogan (Administrator) Damien Pasfield (Senior Manager) Michael Bogue (Director) Quorum: Corporations Regulation 5.6.16(2) Attendee register Time and place convenient: Corporations Regulation 5.6.14 Proofs of debt and proxies 3
Formalities - voting Voting on voices unless poll demanded: Corporations Regulation 5.6.19 Poll can be demanded by: Chairperson; or 2 persons present and entitled to vote; or Creditors representing at least 10% of claims When a poll is conducted, a resolution is passed if: more than half the creditors ( in number ) vote in favour of the resolution; and more than half the creditors ( in value ) vote in favor of the resolution If there is a deadlock, the Chairperson may use their casting vote 4
Purpose of the meeting Meeting held on 17 January 2015 under Section 439A of the Corporations Act was adjourned for period of up to 45 days Reconvened meeting to: provide creditors with an update on the administration; consider and (if thought fit), agree the Administrators’ remuneration set out the Administrators’ opinion on the courses of action available; vote on Cabral’s future: return Cabral to its Directors; or • execute a Deed of Company Arrangement (“DOCA”); or • enter into liquidation • Consider and (if thought fit) approve the Liquidators ’ remuneration 5
Report to creditors – update Brazilian subsidiaries / assets The recapitalisation proposals received attributed little, if any, value to the Brazilian Assets and no binding, stand-alone offers received for the Brazilian Assets No funding has been advanced so the future of Brazilian subsidiaries is uncertain 6
Administrators’ remuneration Resolution – remuneration incurred from 1 December 2014 to 20 February 2015 I now put the following resolution to the meeting: “That the remuneration of the Administrators for the period from 1 December 2014 to 20 February 2015, calculated on hours spent at the rates detailed in the Schedule of Remuneration Methods and Hourly Rates provided to creditors, in the amount of $37,843.00 (excluding GST), is hereby approved for payment. The Administrators are approved to draw their remuneration as and when it is incurred from funds under their control.” 7
Administrators’ remuneration Resolution – estimated remuneration incurred from 21 February 2015 to 19 March 2015 I now put the following resolution to the meeting: “That the Administrators’ remuneration for the period from 21 February 2015 to 19 March 2015 shall be a sum equal to the time cost spent by the Administrators, their partners and their staff, calculated at the rates detailed in the Schedule of Remuneration Methods and Hourly Rates provided to creditors, in the amount of $3,000.00 (exclusive of GST). Creditors acknowledge that if actual costs incurred are below the amount approved, the Administrators are only authorised to draw the amount incurred. Creditors also knowledge that if actual costs incurred exceed the amount approved, the Administrators will seek further approval from creditors. The Administrators are approved to draw their remuneration as and when it is incurred from funds under their control.” 8
Future of the company - Administrators’ recommendations Administration to end As Cabral Brazil is insolvent, control of the company should not be returned to the Directors DOCA No DOCA has been proposed, so creditors are unable to resolve to enter into a DOCA Cabral Brazil be wound up As there is no DOCA and Cabral Brazil is insolvent, the Administrators’ recommendation is that creditors vote in favour of the company being placed into liquidation 9
Future of the company - anticipated return to creditors Cabral Brazil Pty Limited - Estimated return to creditors in a liquidation Particulars High $ Low $ Assets Cash at bank 43 43 Sale of Cabral Brazil's business/assets Unknown Unknown Voidable transaction recoveries Unknown Unknown Less costs Staff, asset maintenance and operational costs - - Administrators' fees from 1 December 2014 to 20 February 2015 (37,843) (37,843) Estimated Administrators' fees from 21 February 2015 to 19 March 2015 (3,000) (3,000) Estimated Liquidators' fees and disbursements (20,000) (20,000) Legal and other professional costs Unknown Unknown Amount available for preferential creditors - - Preferential employee entitlements - - Estimated return to preferential creditors n/a n/a Amount available for unsecured creditors - - Unsecured creditors (18,567,509) (18,567,509) Estimated return to unsecured creditors 0.00% 0.00% Residual funds available to shareholders Nil Nil Source: McGrathNicol analysis The above does not assume any recovery from insolvent trading or voidable transactions The above does not assume any recovery from the sale of the Brazilian Assets 10
Future of the company - resolution Liquidation I now put the following resolution to the meeting: “That Cabral Brazil be wound up and Barry Kogan and Joseph Hayes be appointed Joint and Several Liquidators” 11
Liquidators’ remuneration I now put the following resolution to the meeting: “That the remuneration of the Liquidators, for the period of the liquidation, shall be a sum equal to the time cost spent by the Liquidators, their partners and their staff, calculated at the rates detailed in the Schedule of Remuneration Methods and Hourly Rates provided to creditors, in the amount of $20,000.00 (exclusive of GST). Creditors acknowledge that if actual costs incurred are below the amount approved, the Liquidators are only authorised to draw the amount incurred. Creditors also acknowledge that if actual costs incurred exceed the amount approved, the Liquidators will seek further approval from creditors. The Liquidators are approved to draw their remuneration as and when it is incurred from funds under their control.” 12
Committee of Inspection I now put the following resolution to the meeting: “That a committee of inspection be formed, with the following to be members: ………………………… representing ………………………… ………………………… representing ………………………… ………………………… representing ………………………… ………………………… representing ………………………… ………………………… representing …………………………” 13
Comprise debt resolution I now put the following resolution to the meeting: “That so far as is necessary for the beneficial winding up of Cabral Brazil Pty Limited the Liquidators are hereby authorised pursuant to subsections 506(1A), 477(2A) and 477(2B) of the Corporations Act 2001 to compromise any debt to Cabral Brazil greater than the prescribed amount (currently $100,000) and to enter any agreement on behalf of Cabral Brazil involving a term or obligations extending for more than three months.” 14
Q & A
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