AE&E AUSTRALIA PTY LIMITED (ADMINISTRATORS APPOINTED) Second - PowerPoint PPT Presentation

1 AE&E AUSTRALIA PTY LIMITED (ADMINISTRATORS APPOINTED) Second Meeting of Creditors 11 May 2011

Agenda  Table Administrators ’ Report to Creditors • Australian Taxation Office • Worsley Project • Deed of Company Arrangement Creditors ’ Options   Administrators ’ Opinion and Recommendation  Questions  Resolutions

Introduction  This is the resumption of the Second Meeting of Creditors held on Wednesday 27 April 2011.  Purpose of Meeting • Review Company’s business, property and affairs • Consider future of the Company: Deed of Company Arrangement (“DOCA”) - o Proposal withdrawn - Administration Ends o Inappropriate due to insolvency - Liquidation o Recommended for reasons detailed

Introduction (continued)  Administrator acts as Chairman • Corporations Act 2001 - Section 439B; Corporations Regulation 5.6.17(1)  Convening of Meeting • Convened by Notice dated 3 May 2011, • Advertised in The Australian on 4 May 2011  Proxies to be Tabled • Note proxies from initial meeting still valid  Quorum • “That there is a quorum present.”  Time and Place • “That this meeting has been convened at a time, date and place convenient to the majority of persons entitled to receive notice.”

Introduction (continued)  Voting: Current proof is for voting purposes only. • Creditors will ultimately be requested to prove for dividend purposes.  Voting Determination • Show of hands in the first instance • Poll can be requested (Corporations Regulations 5.6.19, 5.6.20)  Administrators Independence Update • No changes to Declaration of Independence, Relevant Relationships and Indemnities circulated in our First Report to Creditors  Report to Creditors dated 3 May 2011 • (To be taken as read)  This Second Meeting of Creditors decides the future of the Company.

Australian Taxation Office ( “ ATO ” )  The Income tax return for the year ended 30 June 2009 is expected to generate a refund of $5.964million.  The purpose of the adjournment was to allow time to receive a response/assessment from theATO.  We have not received a response from the ATO in relation to this matter and regrettably cannot recommend a Deed of Company Arrangement as detailed in the Report to Creditors dated 14 April 2011.

Worsley Project • WR Carpenters ( “ WRC ” ) have approached us regarding AE&E ’ s continued support beyond the Administration. • WRC have suggested we enter into a Services Agreement to continue to trade the Worsley Project . • Under this agreement, WRC have agreed to pay our reasonable professional fees and costs for work performed on the Worsley Project.

Proposed Deed of Company Arrangement  Our Report to Creditors dated 14 April 2011 detailed the draft proposed Deed of Company Arrangement ( “ DOCA ” ).  As we have had no response/assessment from the ATO in relation to the Income Tax Refund we are unable to recommend the DOCA.  Accordingly, there is no DOCA proposal.  We note: 1. This will have no effect on Asset Recoveries 2. This will have no effect on Claims/Liabilities 3. That the role of the Liquidator will still involve pursuing recovery of assets

Consideration of Alternative Courses of Action  The courses of action available to creditors under the provisions of Section 439C of the Corporations Act 2001, are as follows: a. Resolve that the Company execute a Deed of Company Arrangement ; or b. Resolve that the Administration should end; or c. Resolve that the Company be wound up; or d. Resolve that the meeting be adjourned for a period of thirty five (35) business days.

Administrators ’ Opinion and Recommendation  In a DOCA scenario: • As no response/assessment has been received from the ATO in relation to the Income tax refund, we are unable to recommend the DOCA.  Administration Ends: • The company would still be insolvent and it is unrealistic to contemplate returning it to its director  In Liquidation scenario: • Allows for more thorough review of business and affairs and further investigation of antecedent transactions – no claims currently identified • Employees can immediately lodge claims with GEERS. • Will continue to realise the Company’s assets. • Should be in a position to make a distribution for outstanding superannuation shortly after the appointment

Administrators ’ Opinion and Recommendation  Recommendation “In accordance with requirements of Section 439A(4)(b) of the Corporation Act 2001, the Administrators have formed an opinion that the Creditors should vote that the Company be placed in Liquidation”

The Chairperson opens the meeting for questions

Resolutions

Resolution: Remuneration – Administration Period  “ That the additional remuneration of the Joint and Several Voluntary Administrators and their partners and staff, for the period 13 April 2011 to 30 April 2011, calculated in accordance with the schedule of hourly rates issued from time to time by BRI Ferrier be approved and drawn in the amount of $239,495 plus GST. ”

Resolution: Remuneration – Administration Period  “ That the future remuneration of the Joint and Several Administrators and their partners and staff for the period 1 May 2011 to 10 May 2011 calculated on a time basis in accordance with the schedule of hourly rates issued from time to time by BRI Ferrier and that the Joint and Several Administrators be authorised to make periodic payments on account of such accruing remuneration to a limit of $165,000 plus GST. ”

Resolution: Company be wound up The meeting to resolve:  “ That the Company be wound up ”

Committee of Inspection  At the first meeting of creditors the following creditors were appointed to the Committee of Creditors: Creditor Name Creditor Representative York-Forter Australasia P/L Tracey de Friskbom Ottoway Engineering P/L Stephen Young Lear-Siegler Australasia Carolyn Lechowicz European Banking Syndicate Zac Chami (Clayton Utz) CFMEU Kevin Sneddon Nilsen (WA) Pty Limited Thomas Andres AMWU Shane O'Reilly WR Carpenter No.1 Pty Ltd Chris Hince Mr Graham Lowry Himself (Employee)

Committee of Inspection  Chairman to discuss role and responsibilities of the Committee of Inspection.  Call for nominations from creditors in attendance.

Resolution: Committee of Inspection  “ That the Committee of Inspection be formed and the nominated creditors be appointed its members ”

Resolution: Remuneration – Liquidation Period  “ That the future remuneration of the Joint and Several Liquidators and their partners and staff for the period 11 May 2011 to the completion of the Liquidation, calculated in accordance with the schedule of hourly rates issued from time to time by BRI Ferrier, be approved to a limit of $1,200,000 plus GST and that the Joint and Several Liquidators be authorised to make periodic payments on account of such accruing remuneration. ”

Resolution: Disposal of Books and Records  “ That subject to obtaining the approval of the Australian Securities and Investments Commission under Section 542(4) of the Corporations Act 2001, the books and records of the Company and of the Liquidators be disposed of by the Liquidators six (6) months after the dissolution of the Company or earlier at the discretion of the Australian Securities and Investments Commission. ”

Any Other Business  Meeting Closed.