Circular to Suppliers

Transcription

1 To all suppliers MB Australia Pty Ltd (Administrators Appointed) ACN Elite Luxury International Pty Ltd (Administrators Appointed) ACN (Collectively known as, Max Brenner or the Companies) Circular to Suppliers Kathy Sozou, Jason Preston and I were appointed Joint and Several Voluntary Administrators of Max Brenner at 11:23pm on 30 September The directors of Max Brenner resolved to appoint Voluntary Administrators upon a determination that the Companies were insolvent, or likely to become insolvent. The Administrators have assumed control of Max Brenner s affairs and have entered into possession of its assets. All Max Brenner stores will remain open and continue to trade while the Administrators urgently assess the prospects of completing a going concern sale of the business or a recapitalisation through the Voluntary Administration process. Accordingly, when requested by us or our authorised representatives, we would appreciate you making goods and services available to Max Brenner on your usual trading terms and conditions. If you are currently providing an ongoing service please contact my staff immediately in relation to arrangements for the Administration period. Please adopt the following procedures with regard to any accounts you hold with Max Brenner: close your present account as at the date of my appointment; open a new account, styled MB Australia Pty Ltd (Administrators Appointed) or Elite Luxury International Pty Ltd (Administrators Appointed) ; and only extend credit upon receipt of a signed purchase order authorised by the Administrators or their authorised representatives. We have in place a process whereby all purchase orders must be signed personally by an Administrator or by one of our authorised personnel whose specimen signatures appear on page three of this circular. Please do not deliver goods or provide services without a signed purchase order as these will not be paid for. Payments made by the Administrators must be applied against debts incurred by the Administrators and cannot be applied against any pre-appointment debt owed to you by Max Brenner.

2 Additionally, if you are currently a customer of Max Brenner as well as a creditor, any goods or services supplied to you by Max Brenner following my appointment must be paid in full in accordance within the normal trading terms. Any goods or services provided by Max Brenner are provided in accordance with the above condition. Please note: Any further credit properly incurred for goods and services supplied on the new account will be a liability of the Administrators. Under the Pay As You Go (PAYG) regime, we will be obliged to withhold 46.5% from payments to suppliers who do not quote a current Australian Business Number (ABN). Please ensure that a current ABN is quoted for each supply made by you. Input tax credits for payments made to registered suppliers cannot be claimed until such time as a compliant tax invoice had been received. Accordingly, we expect suppliers to provide a GST compliant tax invoice prior to payment of supplies you make to Max Brenner. A copy of the Insolvency information for directors, employees, creditors and shareholders information sheet issued by the Australian Securities & Investment Commission (ASIC) is enclosed for your information. It is our intention to attend to your enquiries quickly and efficiently and we expect to issue a further circular updating you on the progress of the administration in the near future. We thank you in advance for your assistance and cooperation. If you require any further information, please contact your usual Max Brenner personnel or my office (MaxBrenner@mcgrathnicol.com). Dated 1 October 2018 Yours faithfully MB Australia Pty Ltd (Administrators Appointed) Elite Luxury International Pty Ltd (Administrators Appointed) Barry Kogan Joint and Several Voluntary Administrator Enclosure: Supplier FAQs Insolvency information for directors, employees, creditors and shareholders Page 2

3 MB Australia Pty Ltd (Administrators Appointed) ACN Elite Luxury International Pty Ltd (Administrators Appointed) ACN Schedule of authorised signatories and specimen signatures As at 1 October 2018 Barry Kogan Kathy Sozou Jason Preston Jonathan Henry Chris Johnson Matt Hutton Ricky O Kane Rajiv Goyal Page 3

4 MB Australia Pty Ltd (Administrators Appointed) ACN Elite Luxury International Pty Ltd (Administrators Appointed) ACN (Collectively known as, Max Brenner or the Companies) Supplier Frequently Asked Questions Barry Kogan, Kathy Sozou and Jason Preston were appointed Joint and Several Voluntary Administrators (Administrators) of Max Brenner at 11:23pm on 30 September 2018 following a resolution of its directors. The purpose of this document is to answer some frequently asked questions that suppliers may have about the Administration. This information sheet covers the following key areas: operations; administration process; and suppliers. As Administrators, we act as agents of Max Brenner. The Administrators are not adopting any contract that exists, or may have existed, between any party and Max Brenner. Please note that this document will be revised periodically by the Administrators and is subject to change. Any revised documents will be made available in store and on McGrathNicol s website under Creditors. Queries Supplier queries should be directed to MaxBrenner@mcgrathnicol.com. The Administrators or Max Brenner staff may respond directly or by update to this FAQ. The Administrators will also add to this document as required. 1

5 OPERATIONS Is the business continuing to trade? Yes. All stores will remain open and continue to trade while the Administrators urgently assess the prospects of completing a recapitalisation or going concern sale of the business through the Voluntary Administration process. What is happening with suppliers? The Administrators are working with suppliers to establish new accounts. Repairs and maintenance and other requests will require a purchase order to be signed by an authorised signatory as set out in the Circular to Suppliers. Payments for work performed or goods supplied pursuant to an Administrator s purchase order is a liability of the Administrator and will be paid. Please issue any purchase order requests to your supervisor, store manager or manager for initial approval. All purchase order requests which receive initial approval should then be submitted for final review by an authorised representative of the Administrators. How soon will a decision be made about the future of Max Brenner? No timetable has been set at this time. The Administrators will provide updates throughout the administration. ADMINISTRATION PROCESS What has happened to Max Brenner? Why did the administration come about? The Directors of Max Brenner resolved to appoint Voluntary Administrators upon a determination that the Companies were insolvent, or likely to become insolvent. What is a voluntary administration? Voluntary administration is an insolvency procedure where the directors of an insolvent company (i.e. one that is unable to pay its debts) appoint an external administrator called a Voluntary Administrator. The role of the Voluntary Administrator is to investigate Max Brenner s affairs to assess the potential for rehabilitation or recapitalisation, to report to creditors and to recommend to creditors whether Max Brenner should enter into a Deed of Company Arrangement, go into liquidation or be returned to the directors. For more information regarding administrations, please visit 2

6 What is the role/authority of the Max Brenner directors? Do we take direction from them or from the Administrators? The Administrators make all financial and strategic decisions relating to Max Brenner and have ultimate executive control of Max Brenner. Max Brenner s directors duties are suspended while Max Brenner is in Administration. The Administrators continue to work with Max Brenner s Directors, management and employees should continue to report to their store / operations managers. Who is McGrathNicol? McGrathNicol is an independent advisory and restructuring firm specialising in Advisory, Forensic, Transactions, Restructuring and Insolvency. Where can I get information in relation to the administration? Information will periodically be posted to the Administrators website under the Creditors tab. What is the first meeting of creditors? The Administrators are required to hold a meeting of creditors within eight business days of their appointment. Formal notification of the meeting details will be issued in due course. What is the second meeting of creditors? The Administrators are ordinarily required to hold a second meeting of creditors within approximately one month of their appointment, unless an extension is granted. You will receive formal notification of the meeting details ahead of that time. The purpose of this meeting is predominantly for creditors to determine the future of Max Brenner. The options available to creditors can include returning control of Max Brenner back to its directors; executing a Deed of Company Arrangement if one is proposed; or, placing Max Brenner into liquidation. Should I attend the creditor meetings? Creditors are entitled to attend the meetings of creditors or appoint a proxy on their behalf. A proxy form (where you nominate someone to vote on your behalf if any polls are required at the meeting) will be provided with the notice of the meeting and there will be further communications in this regard. 3

7 SUPPLIERS What is the process for receiving orders from Max Brenner? The process for orders under Administration is: open a new account, styled MB Australia Pty Ltd (Administrators Appointed) or Elite Luxury International Pty Ltd (Administrators Appointed) as appropriate; and purchase orders will be provided but must be authorised by an authorised signatory (please refer to the Circular to Suppliers for authorised signatories). When issuing invoices for supply after the appointment of Administrators, please ensure the above company name is used on invoices and that a copy of the invoice is sent to your usual address as well as to MaxBrenner@mcgrathnicol.com (along with a copy of the authorised purchase order and delivery docket to ensure no delays in processing for payment). Max Brenner has an amount outstanding, why should suppliers continue to trade with the Administrators? Under the Corporations Act 2001, the Administrators are personally liable for debts incurred post 1 October 2018 with their express authority (i.e. have been ordered via an authorised purchase order). Accordingly, any orders authorised by the Administrators will be paid. What should I do with deliveries received? If the stock has been prepaid, the delivery should be accepted and recorded against the pre-appointment account. If the stock has not been paid for, please consult with the Administrators and their representatives. Who is authorised to place orders? Please refer to the circular to supplies for authorised signatories. These are currently: Barry Kogan, Kathy Sozou, Jason Preston, Jonathan Henry, Chris Johnson, Matt Hutton, Ricky O Kane, and Rajiv Goyal. What are the terms of trade? The Administrators accounts will be paid 30 days end of month unless otherwise agreed with the Administrators. Will outstanding supplier accounts be paid? The amount outstanding at the date of the Administrators appointment is an unsecured debt of Max Brenner and unfortunately cannot be paid. Please refer to the circular to creditors for further information. Can I collect my goods? No. Under no circumstances can suppliers collect their goods without prior approval of the Administrators. A letter to security interest holders will be issued shortly with further information. I have received a payment; can I apply this to amounts owed to me? No, all payments made by the Administrators must be applied to post-appointment supply. 4

8 How do I lodge a claim? To lodge a claim suppliers must complete a proof of debt or claim form. These will become available on the McGrathNicol website and be provided in an upcoming creditors circular. These can be forwarded to MaxBrenner@mcgrathnicol.com. What happens after a proof of debt is submitted to record a claim? Once the Administrators have received a proof of debt from a supplier, the supplier will be added to the Max Brenner creditor listing and will receive updates on the progress of the administration, including prospects of distributions. 5

9 Insolvency information for directors, employees, creditors and shareholders ASIC has 11 insolvency information sheets to assist you if you re affected by a company s insolvency and have little or no knowledge of what s involved. These plain language information sheets give directors, employees, creditors and shareholders a basic understanding of the three most common company insolvency procedures liquidation, voluntary administration and receivership. There is an information sheet on the independence of external administrators and one that explains the process for approving the fees of external administrators. A glossary of commonly used insolvency terms is also provided. The Insolvency Practitioners Association (IPA), the leading professional organisation in Australia for insolvency practitioners, endorses these publications and encourages its members to make their availability known to affected people. List of information sheets INFO 41 Insolvency: a glossary of terms INFO 74 Voluntary administration: a guide for creditors INFO 75 Voluntary administration: a guide for employees INFO 45 Liquidation: a guide for creditors INFO 46 Liquidation: a guide for employees INFO 54 Receivership: a guide for creditors INFO 55 Receivership: a guide for employees INFO 43 Insolvency: a guide for shareholders INFO 42 Insolvency: a guide for directors INFO 84 Independence of external administrators: a guide for creditors INFO 85 Approving fees: a guide for creditors Getting copies of the information sheets To get copies of the information sheets, visit ASIC s website at The information sheets are also available from the IPA website at The IPA website also contains the IPA s Code of Professional Practice for Insolvency Professionals, which applies to IPA members. Important note: The information sheets contain a summary of basic information on the topic. It is not a substitute for legal advice. Some provisions of the law referred to may have important exceptions or qualifications. These documents may not contain all of the information about the law or the exceptions and qualifications that are relevant to your circumstances. You will need a qualified professional adviser to take into account your particular circumstances and to tell you how the law applies to you. Australian Securities & Investments Commission, December 2008 Page 1 of 1