CROSSWAYS FARM VILLAGE (PTY) LTD (IN BUSINESS RESCUE) – 2nd Status Report

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Business Rescue Status Report

In terms of Section 132(3) (a) and (b) (i) of the Companies Act No 71 of 2008 (“the Companies  Act”)

Dated 15 August 2016

(the 2nd Status Report)

 CROSSWAYS FARM VILLAGE (PTY) LIMITED

REGISTRATION NUMBER 2007/025326/07

(“the Company”)

 Prepared by:

JURGENS JOHANNES STEENKAMP – Business Rescue Practitioner

The Companies Act 71 of 2008, as amended, and more specifically section 132(3) thereof, provides that where a company’s business rescue proceedings have not ended within three months after the start of those proceedings, the practitioner must prepare a report on the progress of the business rescue proceedings and update it at the end of every subsequent month until the end of those proceedings. In addition the report must be delivered to all affected persons and to the court due to the proceedings having been commenced by way of an order of court.

PART A:  BACKGROUND

  1. Application of placing Company in Business Rescue and appointment of Business Rescue Practitioner
    • The Company was placed under supervision and in business rescue in terms of section 131(4)(a) of the Companies Act read with section 131(7) of the Companies Act on 15 April 2016 by an order of the High Court of South Africa (Eastern Cape Local Division, Port Elizabeth) (“the Business Rescue Order“) pursuant to an application by Polkadots Properties 133 (Pty) Limited (“Polkadots”) for the liquidation of the Company, which application was opposed by the Company.
    • The business rescue proceedings accordingly commenced on 15 April 2016 (“the Commencement Date”).
    • I was appointed by the court as the Interim Business Rescue Practitioner (“the BRP”) as required by the Companies Act. My appointment was ratified by the creditors at the first meeting of creditors.
  2. Business Rescue Proceedings
    • The First Meeting of Creditors in accordance with section 147 of the Act was held on 3 May 2016 at the offices of KPMG Services (Pty) Limited, KPMG House, 200 Norvic Drive, Greenacres, Port Elizabeth (“the First Meeting”).
    • On the same day, a first meeting of employees were held at Crossways Farm Village.
    • Minutes of these meetings were attached to the previous status report.
    • The business rescue plan was published on 17 June 2016 after the holders of the majority of creditors’ voting interests allowed the practitioner a longer period than the prescribed 25 business days, in accordance with section 150(5) of the Act.
    • The meeting to determine the future of the company was convened in accordance with the provisions of section 151 of the Act and held on 28 June 2016 at the offices of KPMG Services (Pty) Limited, KPMG House, 200 Norvic Drive, Greenacres, Port Elizabeth.
    • At the section 151 meeting the required majorities of holders of creditors’ interests and independent voting interests voted in favour of the adoption of the business rescue plan after proposals for the minor amendment of the plan as published were adopted. A copy of the minutes of the meeting and the plan as adopted were attached to the previous report.
    • The business rescue plan provide in main for a period until the 31st of August 2016 for the practitioner to negotiate with potential investors to restructure the affairs of the company for the benefit of creditors, failing which the assets will be disposed in a structured process as set out in the plan.

An indicative offer was received and after consultation with the affected parties the offeror was advised that the creditors will accept such an offer subject to them agreeing the further terms and conditions of a final agreement. The business rescue practitioner will continue to negotiate a final agreement with the investor group and report further as and when required either due to material developments or as prescribed in terms of the Act.

 Jurgens Johannes Steenkamp

Business Rescue Practitioner                                                                          

Date:    15 August 2016