Stone Benches Pty Ltd (In Liquidation) ACN (The Company)

Transcription

1 The Creditor as Addressed 13 March 2018 Dear Sir/Madam, Grant Thornton Australia Limited King George Central Level Ann Street Brisbane, QLD 4000 T F Stone Benches Pty Ltd (In Liquidation) ACN (The Company) Initial Information for Creditors The following document is provided to creditors of Stone Benches Pty Ltd pursuant to section of the Insolvency Practise Rules (Corporations) The purpose of this document is to provide you with information about the liquidation of the Company and outline your rights as a creditor. Notification of Appointment We were appointed Joint and Several Liquidators of the Company by a resolution of the Company s members on Tuesday, 27 February A copy of our Declaration of Independence, Relevant Relationships and Indemnities (DIRRI) is attached at Appendix A. The DIRRI assists you to understand any relevant relationships that we have, and any indemnities or upfront payments that have been provided to us. We have considered each relationship and it is our opinion that none of the relationships disclosed in the DIRRI result in a conflict of interest or duty or affect our independence. What is a Creditors Voluntary Liquidation? A creditors voluntary liquidation, or CVL, is a liquidation initiated by the Company where it is unable to pay all of its creditors in full. This means that the Company is insolvent. According to the Company s records, you may be a creditor of the Company. What happens to your debt? All creditors of the Company are now creditors in the liquidation. As a creditor, you have certain rights, although your debt will now be dealt with in the liquidation. If you have leased the company property, have a retention of title claim or hold a Personal Property Security in relation to the company, please contact our staff as soon as possible. ABN ACN Grant Thornton refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another s acts or omissions. In the Australian context only, the use of the term Grant Thornton may refer to Grant Thornton Australia Limited ABN and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.

2 Your rights as a creditor Information regarding your rights as a creditor is provided in the information sheet included at Appendix B. This includes your right to: Make reasonable requests for a meeting Make reasonable requests for information Give directions to me Appoint a reviewing liquidator To replace me as liquidator. We wish to draw to your attention the special right to request a meeting in the first 20 business days of a creditor s voluntary liquidation. If we receive a request for a meeting from at least 5% of known creditors that are not a related entity of Stone Benches Pty Ltd, we are required to hold a meeting, as long as the request is reasonable. The details of whether a request is reasonable or not is included in the information sheet at Appendix B. Summary of the Company s Affairs At the date of writing, the director of the Company has yet to provide our office with a Report as to Affairs (RATA). On 13 March 2018, the director requested, and was granted, an extension to 20 March 2018 to complete the RATA. Creditors wishing to obtain a copy may contact our office after this date. Listing of Creditors We have attached at Appendix C a list of creditors, including their address and the estimated amounts of their claims that are shown in the records of the Company. Any creditors related to the Company are identified. We are required to provide this information to creditors under law. Update on liquidation to date A more detailed report on the Liquidation will be circulated to all creditors within 3 months from the date of our appointment, however, we provide a brief update on our activities to date below. We were appointed Liquidators of both the Company and its related party, Caramo Pty Ltd, on 27 February Both companies operated separate but similar businesses constructing kitchens and undertaking stone masonry related to kitchen and other commercial and residential use benchtops. The director advises the businesses encountered difficulties due primarily to several material bad debts plus a general downturn in industry profit margins. The business of Caramo was closed sometime during 2017 after the sale of the core operating business. Since that time Stone Benches had continued to operate in a limited capacity but that business was impacted by loss of key staff over the Christmas/New Year period which ultimately led to the director determining that they could no longer continue to trade through their financial position. The trading activities of the Company ceased prior to our appointment. Since our appointment, we have secured the assets of the Company, which consist primarily of plant & equipment used for the manufacture of stone bench tops, as well as some motor vehicles. These assets are subject to security from the Bank of Queensland. The Company also has a number of outstanding debtors which we expect to recover in the liquidation. What happens next? We will proceed with the liquidation, including: Recovering and selling any available property Investigating the Company s affairs Reporting to the corporate regulator, the Australian Securities and Investments Commission (ASIC).

3 If we receive a request for a meeting that complies with the guidelines set out in the creditor rights information sheet, we will hold a meeting of creditors. We will write to you within three months of our appointment advising whether a dividend is likely and update you on the progress of our investigations. We may write to you again after that with further information on the progress of the liquidation. Costs of the Liquidation Included at Appendix D is our Initial Remuneration Notice. This document provides you with information about how we propose to be paid for undertaking the liquidation. Attached in Annexure E is a detailed report on our remuneration, called a Remuneration Approval Report. We are unable to pay our remuneration without the approval of creditors or the Court. In accordance with the Initial Remuneration Notice and Remuneration Approval Report, our estimated remuneration for the liquidation is $15,000 excluding GST and outlays. We propose to have our remuneration and internal disbursements approved by a proposal without a meeting. Information about passing resolutions without a meeting and a Notice of Proposal to Creditors is enclosed. I request that you return to this office the completed Notice of Proposal to Creditors by Friday, 6 April We also propose to seek creditor approval for the early destruction of the Company s books and records by way of a proposal without meeting. Where can you get more information? The Australian Restructuring Insolvency and Turnaround Association (ARITA) provide information to assist creditors with understanding liquidations and insolvency. This information is available from ARITA s website at arita.com.au/creditors. ASIC also provides information sheets on a range of insolvency topics. These information sheets can be accessed on ASIC s website at asic.gov.au (search for insolvency information sheets ). Please contact our office should you require further information. There is also information about this liquidation on our firm s website: Yours Faithfully Shaun McKinnon Joint and Several Liquidator Appointment Date: Tuesday, 27 February 2018 Contact Name: Kegan Nash Contact Number: (07) kegan.nash@au.gt.com

4 Attachments Appendix A Appendix B Appendix C Appendix D Appendix E Declaration of Independence, Relevant Relationships and Indemnities Information Sheet - Creditor Rights in Liquidation List of creditors identifying related parties Initial Remuneration Notice Remuneration Approval Report Enclosures (i) (ii) Notice of Proposal to Creditors Form 535 Proof of Debt

5 Appendix A Declaration of Independence, Relevant Relationships and Indemnities

6 Declaration of Independence, Relevant Relationships and Indemnities Stone Benches Pty Ltd (In Liquidation) ACN (the Company) Practitioner/s appointed to an insolvent entity are required to make declarations as to: A B their independence generally relationships, including i ii the circumstances of the appointment any relationships with the [company/debtor] and others within the previous 24 months iii any prior professional services for the [company/debtor] within the previous 24 months iv that there are no other relationships to declare and C any indemnities given, or up-front payments made, to the Practitioner. This declaration is made in respect of ourselves, our partners, Grant Thornton Australia Limited (GTAL) (the Firm) and any of the GTAL s associated entities. A Independence We, Shaun McKinnon and Stephen Dixon of Grant Thornton Australia Limited have undertaken a proper assessment of the risks to our independence prior to accepting the appointment as Liquidators of Stone Benches Pty Ltd in accordance with the law and applicable professional standards. This assessment identified no real or potential risks to our independence. We are not aware of any reasons that would prevent us from accepting this appointment. B Declaration of Relationships Circumstances of appointment This appointment was referred to us by Ian Greet of Fidele Consulting ( Fidele ) who act on behalf of the director of Stone Benches Pty Ltd. We had no previous relationship with the Company or its director. We believe that this appointment and referral do not result in a conflict of interest or duty because: We met with the Director on only two occasions, being 31 January 2018 and then on 15 February These meetings were only to discuss the financial position of the Company and the options available. No advice was provided with respect to the Director s personal financial position. We received no remuneration for any of the advice listed in the meetings above. In our opinion, these meetings and discussions do not affect our independence for the following reasons: The Courts and the ARITA Code of Professional Practice specifically recognise the need for practitioners to provide advice on the insolvency process and the options available to directors and do not consider that such advice results in a conflict or is an impediment to accepting the appointment; The nature of the advice provided to the Company is such that it would not be subject to review and challenge during the course of the Liquidation;

7 The pre-appointment advice will not influence our ability to be able to fully comply with the statutory and fiduciary obligations associated with the Liquidation of the Company in an objective and impartial manner; All meetings with the Director and Fidele were undertaken to better understand the structure and operations of the Company prior to consenting to act as Liquidators; and We have provided no information or advice to the Company, the director or its advisors prior to our appointment beyond that outlined in this DIRRI. Relevant Relationships (excluding Professional Services to the Insolvent) We or a member of our firm, have, or have had within the preceding 24 months, a relationship with: Name Nature of relationship Reasons Ian Greet of Fidele Consulting ( Fidele ) Bank of Queensland ( BOQ ) Fidele are a business consulting firm that provide financial and commercial advice to Company s and their directors who are experiencing financial difficulties. Fidele are a regular referrer of work to Stephen Dixon of Grant Thornton. Grant Thornton has from time to time engaged Fidele Consulting to assist with the administration of insolvent entities under their administration where Fidele has specific knowledge that will facilitate the most efficient and cost effective asset realisation process. Fidele are not being engaged by Grant Thornton in any capacity in relation to the Liquidation of the Company. BOQ are a financier to the Company. Grant Thornton is regularly engaged by BOQ in restructuring and recovery related matters. These roles include acting as Receiver and Manager, Agent for the Mortgagee in Possession and Investigating Account for BOQ. Grant Thornton also provides secondees to BOQ s Asset Management Group from time to time. During 2017 one of those secondees was involved in the management of the Stone Benches Pty Ltd s account which had been transferred to BOQ s Asset Management team. We do not consider the relationship with Fidele to represent a conflict for the following reasons: Neither we nor the firm have undertaken any work for Fidele in relation to the Company; There are not any transactions between the Company and Fidele that would be subject to review by the Liquidators; Referals from Fidele do not represent a material amount of fee revenue of either Stephen Dixon or Grant Thornton; Our past involvement with Fidele will not influence our ability to be able to fully comply with the statutory and fiduciary obligations associated with the conduct of the Liquidation of the Company in an objective and impartial manner. We do not consider the relationship with BOQ to represent a conflict for the following reasons: Neither we nor the Firm have undertaken any work for BOQ with respect to the Company. Our past involvement with BOQ will not influence our ability to be able to fully comply with the statutory and fiduciary obligations associated with the conduct of the Liquidation of the Company in an objective and impartial manner. Our prior engagements with BOQ were undertaken on an entirely separate basis and have no connection with these appointments. The staff member previously on secondment with BOQ completed their secondment in December 2017 and is currently on special paternity leave and will not have any involvement with the Liquidation.

8 Australian Taxation Office ( the ATO ) We note that the ATO may have a claim against the Company. We have had past dealings with the ATO in its capacity as a creditor of past insolvency liquidations conducted by us as insolvency practitioners. In addition we have consented to, and have acted as, Official Liquidators where the ATO has issued winding up proceedings. Our past involvement with the ATO will not influence our ability to be able to fully comply with the statutory and fiduciary obligations associated with the conduct of the Liquidation of the Company in an objective and impartial manner. Prior Professional services to the Insolvent Neither we, nor our firm, have, or have had within the preceding 24 months, any relationships with the Company, associates of the Companies, or any person or entity that has security over the whole or substantially whole of the Company s property. No other relevant relationships to disclose There are no other known relevant relationships, including personal, business and professional relationships, from the previous 24 months with the Company, an associate of the Company, a former insolvency practitioner appointed to the Company or any person or entity that has security over the whole or substantially whole of the Company s property that should be disclosed. C Indemnities and up-front payments We have not been indemnified in relation to this liquidation, other than any indemnities that we may be entitled to under statute and we have not received any up-front payments in respect of our remuneration or disbursements. Dated: 27 February 2018 SHAUN CHRISTOPHER MCKINNON JOINT AND SEVERAL LIQUIDATOR STEPHEN ROBERT DIXON JOINT AND SEVERAL LIQUIDATOR Note: 1 If circumstances change, or new information is identified, we are required under the Corporations Act 2001 and the ARITA Code of Professional Practice to update this Declaration and provide a copy to creditors with our next communication as well as table a copy of any replacement declaration at the next meeting of the insolvent s creditors. 2 Any relationships, indemnities or up-front payments disclosed in the DIRRI must not be such that the Practitioner is no longer independent. The purpose of components B and C of the DIRRI is to disclose relationships that, while they do not result in the Practitioner having a conflict of interest or duty, ensure that creditors are aware of those relationships and understand why the Practitioner nevertheless remains independent.

9 Appendix B Information Sheet Creditor Rights in Liquidation

10 Creditor Rights in Liquidations As a creditor, you have rights to request meetings and information or take certain actions: Right to request a meeting Right to request information Right to give directions to liquidator Right to appoint a reviewing liquidator Right to replace liquidator Right to request a meeting In liquidations, no meetings of creditors are held automatically. However, creditors with claims of a certain value can request in writing that the liquidator hold a meeting of creditors. A meeting may be requested in the first 20 business days in a creditors voluntary liquidation by 5% of the value of the debts held by known creditors who are not a related entity of the company. Otherwise, meetings can be requested at any other time or in a court liquidation by: > 10% but < 25% of the known value of creditors on the condition that those creditors provide security for the cost of holding the meeting 25% of the known value of creditors creditors by resolution, or a Committee of Inspection (this is a smaller group of creditors elected by, and to represent, all the creditors). If a request complies with these requirements and is reasonable, the liquidator must hold a meeting of creditors as soon as reasonably practicable. Right to request information Liquidators will communicate important information with creditors as required in a liquidation. In addition to the initial notice, you should receive, at a minimum, a report within the first three months on the likelihood of a dividend being paid. Additionally, creditors have the right to request information at any time. A liquidator must provide a creditor with the requested information if their request is reasonable, the information is relevant to the liquidation, and the provision of the information would not cause the liquidator to breach their duties. A liquidator must provide this information to a creditor within 5 business days of receiving the request, unless a longer period is agreed. If, due to the nature of the information requested, the liquidator requires more time to comply with the request, they can extend the period by notifying the creditor in writing. Requests must be reasonable. They are not reasonable if: Both meetings and information: (a) complying with the request would prejudice the interests of one or more creditors or a third party (b) there is not sufficient available property to comply with the request (c) the request is vexatious Meeting requests only: (d) a meeting of creditors dealing with the same matters has been held, or will be held within 15 business days Information requests only: (e) the information requested would be privileged from production in legal proceedings (f) disclosure would found an action for breach of confidence (g) the information has already been provided (h) the information is required to be provided under law within 20 business days of the request If a request is not reasonable due to (b), (d), (g) or (h) above, the liquidator must comply with the request if the creditor meets the cost of complying with the request. Otherwise, a liquidator must inform a creditor if their meeting or information request is not reasonable and the reason why. ARITA ACN Level 5, 191 Clarence Street, Sydney NSW 2000 Australia GPO Box 4340, Sydney NSW 2001 t e admin@arita.com.au arita.com.au AUSTRALIAN RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION

11 Right to give directions to liquidator Creditors, by resolution, may give a liquidator directions in relation to a liquidation. A liquidator must have regard to these directions, but is not required to comply with the directions. If a liquidator chooses not to comply with a direction given by a resolution of the creditors, they must document their reasons. An individual creditor cannot provide a direction to a liquidator. Right to appoint a reviewing liquidator Creditors, by resolution, may appoint a reviewing liquidator to review a liquidator s remuneration or a cost or expense incurred in a liquidation. The review is limited to: remuneration approved within the six months prior to the appointment of the reviewing liquidator, and expenses incurred in the 12 months prior to the appointment of the reviewing liquidator. The cost of the reviewing liquidator is paid from the assets of the liquidation, in priority to creditor claims. An individual creditor can appoint a reviewing liquidator with the liquidator s consent, however the cost of this reviewing liquidator must be met personally by the creditor making the appointment. Right to replace liquidator Creditors, by resolution, have the right to remove a liquidator and appoint another registered liquidator. For this to happen, there are certain requirements that must be complied with: Meeting request Information and notice Resolution at meeting A meeting must be reasonably requested by the required number of creditors. Creditors must inform the existing liquidator of the purpose of the request for the meeting. Creditors must determine who they wish to act as the new liquidator (this person must be a registered liquidator) and obtain: Consent to Act, and Declaration of Independence, Relevant Relationships and Indemnities (DIRRI). The existing liquidator will send a notice of the meeting to all creditors with this information. If creditors pass a resolution to remove a liquidator, that person ceases to be liquidator once creditors pass a resolution to appoint another registered liquidator. For more information, go to Version: July (LIQ) - INFO - CREDITOR RIGHTS INFORMATION SHEET V1_0 AUSTRALIAN RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION PAGE 2

12 Appendix C List of Creditors Identifying Related Parties

13 List of Creditors Identifying Related Parties The following table is provided to all creditors pursuant to Section 497(1)(a)(ii) of the Corporations Act 2001 (Cth). The information contained within the table is sourced from the Company s books and records and documents provided to our office by creditors. Information relating to individuals has been withheld from publication on our website. Creditor Address Related Party Amount ($) Secured Creditor BOQ Finance Level 6, 100 Skyring Terrace Newstead QLD 4006 No 7,704 Caesarstone Australia Unit 3, 1 Secombe Place Moorebank NSW 2170 No 5,904 Fuji Xerox Business Centre Unit 12B/189 Anzac Ave TOOWOOMBA QLD 4350 No 229 Laminex Industries Mansell Street TOOWOOMBA QLD 4350 No 1,945 Preferred Creditors Withheld Withheld No Unknown Withheld Withheld No Unknown Withheld Withheld No Unknown Withheld Withheld No Unknown Withheld Withheld No Unknown Withheld Withheld No Unknown Withheld Withheld No Unknown Unsecured Creditor Australian Taxation Office Australian Taxation Office Mackay QLD 4740 No 61,220 BP Australia Pty Ltd GPO Box 1621 Melbourne VIC 3001 No 1,104 Caesarstone CAESARSTONE No 17,818 Caltex Po Box 691 Archerfield QLD 4108 No 129 CMP Stonemason Supplies Pty Ltd PO Box 1 Hampton Park VIC 3976 No 2,518 Colwar & Bedser Superannuation PO Box 8 MURWILLUMBAH NSW 2484 No 18,261 Cosentino 8 Gassman Drive YATALA QLD 4207 No 600 Donaldson Electirc Works Pty Ltd 10 Laurel Street TOOWOOMBA QLD 4350 No 452 Ergon Energy Australia Po Box 1090 TOWNSVILLE QLD 4810 No 3,712 Farnese 5 Heald Road INGLEBURN NSW 2565 No 1,326 Shreks Septic Services 289 Ganzers Road GOWRIE JUNCTION QLD 4352 No 390 Supagas PO Box 1503 BEENLEIGH QLD 4207 No 7 Telstra Locked Bag Melbourne VIC 3001 No 902 The Pittsworth Sentinel Attention Tanya, PO Box 1 Pittsworth QLD 4356 No 288 Toowoomba Bench Tops (CTS) 9 Tradewinds Court TOOWOOMBA QLD 4350 Yes 17,893 TS South Pacific PO Box 6008 MAROOCHYDORE BC QLD 4558 No 26,972 Wayne Aitken Joinery By No 8,470 WK Stone 97 Spencer Road NERANG QLD 4221 No 9,646 Total Creditor Claims 187,488

14 Appendix D Initial Remuneration Notice

15 Initial Remuneration Notice Stone Benches Pty Ltd (In Liquidation) ACN ( The Company ) The purpose of the Initial Remuneration Notice is to provide you with information about how we propose our remuneration for undertaking the Creditors Voluntary Liquidation will be set. 1 Remuneration Methods There are four basic methods that can be used to calculate the remuneration charged by an insolvency practitioner. They are: A. Time based / hourly rates: This is the most common method. The total fee charged is based on the hourly rate charged for each person who carried out the work multiplied by the number of hours spent by each person on each of the tasks performed. B. Fixed Fee: The total fee charged is normally quoted at the commencement of the administration and is the total cost for the administration. Sometimes a practitioner will finalise an administration for a fixed fee. C. Percentage: The total fee charged is based on a percentage of a particular variable, such as the gross proceeds of assets realisations. D. Contingency: The practitioner s fee is structured to be contingent on a particular outcome being achieved. 2 Method chosen Given the nature of this liquidation we propose that our remuneration be calculated on a time based / hourly rates method. This is because: It ensures that creditors are only charged for work that is performed. The Practitioner is required to perform a number of tasks which do not relate to the realisation of assets, for example responding to creditor enquiries, reporting to ASIC, distributing funds in accordance with the provisions of the Corporations Act or the Bankruptcy Act. The practitioner is unable to estimate with certainty the total amount of fees necessary to complete all tasks required in the Liquidation. The practitioner has a time recording system that can produce a detailed analysis of time spent on each type of task by each individual staff member utilised in the liquidation; Time based remuneration calculates fees upon a basis of time spent at the level appropriate to the work performed; The method provides full accountability in the method of calculation. ABN ACN Grant Thornton refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another s acts or omissions. In the Australian context only, the use of the term Grant Thornton may refer to Grant Thornton Australia Limited ABN and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.

16 3 Explanation of Hourly Rates The rates for our remuneration calculation is set out in the following table together with a general guide showing the qualifications and experience of staff engaged in the administration and the role they take in the administration. The hourly rates charged encompass the total cost of providing professional services and should not be compared to an hourly wage. Title Partner Associate Director Senior Manager Manager Senior Associate Associate Description Registered Liquidator / Trustee. Partner bringing specialist skills to Administrations and Insolvency matters. Controlling all matters relating to the assignment. Qualified accountant (CA/CPA) and may be a registered Liquidator/Trustee. Minimum 7/8+ years experience. Likely to be appointed as a director in due course. Highly advanced technical and commercial skills. Planning and control of all Administration and Insolvency tasks. Controlling substantial matters relating to the assignment and reporting to the appointee. Qualified accountant (CA/CPA). 7/8+ years experience. Well-developed technical and commercial skills. Planning and control of all Administration and Insolvency tasks. Controlling substantial matters relating to the assignment and reporting to the appointee. Typically CA/CPA Qualified. 5-8 years experience. Well-developed technical and commercial skills. Planning and control of Liquidation and Insolvency tasks with the assistance of the appointee. Typically CA/CPA Qualified. 3-5 years experience. Required to control the fieldwork on Liquidations and Insolvency tasks. Typically undertaking CA/CPA Qualifications. Up to 3 years experience. Required to conduct the fieldwork on smaller Administrations and Insolvency tasks and assist with fieldwork on medium to large Liquidations and Insolvency tasks. Hourly Rate $ (Excl GST) Administrator Carries out all secretarial functions relating to a Liquidation. 195 Secretary Conducts all aspects relating to administering the accounts function Estimated remuneration We estimate that this liquidation will cost approximately $15,000 (excluding GST) to complete. This is in line with the estimate communicated to the Director of the Company prior to our appointment. 5 Disbursements Disbursements are divided into three types: Externally provided professional services - these are recovered at cost. An example of an externally provided professional service disbursement is legal fees. Externally provided non-professional costs such as travel, accommodation and search fees - these are recovered at cost. Internal disbursements such as photocopying, printing and postage. These disbursements, if charged to the Administration, would generally be charged at cost; though some expenses such as telephone calls, photocopying and printing may be charged at a rate which recoups both variable and fixed costs. The recovery of these costs must be on a reasonable commercial basis. We are not required to seek creditor approval for disbursements paid to third parties, but must account to creditors. However, we must be satisfied that these disbursements are appropriate, justified and reasonable.

17 We are required to obtain creditor s consent for the payment of internal disbursements where there may be a profit or advantage. Creditors will be asked to approve our internal disbursements where there is a profit or advantage prior to these disbursements being paid from the administration. Details of the basis of recovering disbursements in this administration are provided below. Basis of disbursement claim Internal disbursements Courier Postage (large) Postage (small) Fax (interstate) Fax (local) Staff vehicle use Rates applicable for financial year ending 30 June 2018 Rate (excl. GST) At cost $1.91 / page $0.99 / page $2 / page $1 / page $0.66 / km SHAUN MCKINNON JOINT AND SEVERAL LIQUIDATOR Tuesday, 13 March 2018

18 Appendix E Remuneration Approval Report

19 Remuneration Approval Report Stone Benches Pty Ltd (In Liquidation) ACN ( the Company ) This remuneration approval report provides you with the information you need to be able to make an informed decision regarding the approval of our remuneration for undertaking the Creditors Voluntary Liquidation of Stone Benches Pty Ltd. This report has the following information included: Part 1: Declaration 2 Part 2: Executive Summary 2 Part 3: Remuneration Remuneration claim resolutions Details of remuneration Likely impact on dividends 3 Part 4: Disbursements Basis of Internal Disbursements 4 Part 5: Queries 4 Part 6: Approval of remuneration and internal disbursements 4 What do you need to do next? You should read this report and the other documentation that we have sent you. To minimise the costs in this Creditors Voluntary Liquidation, we have elected to seek the approval of creditors for our remuneration and internal disbursements without a meeting. Information about the proposals without a meeting process is included at part 6 of this report. You can cast your vote by using the included voting forms. These forms then need to be returned to our office by post, scanned and ed or faxed. We need to receive your forms by for your vote to count. If you chose to use post, please allow enough time for your letter to be delivered. If you have any questions, or need any assistance with understanding the materials we have sent to you, please contact Kegan Nash on (07) or via on kegan.nash@au.gt.com. ABN ACN Grant Thornton refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another s acts or omissions. In the Australian context only, the use of the term Grant Thornton may refer to Grant Thornton Australia Limited ABN and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.

20 Part 1: Declaration Stephen Dixon and I, Shaun McKinnon of Grant Thornton Australia Limited have undertaken a proper assessment of this remuneration claim for our appointment as Joint and Several Liquidators of Stone Benches Pty Ltd in accordance with the law and applicable professional standards. We are satisfied that the remuneration claimed is in respect of necessary work, properly performed, or to be properly performed, in the conduct of the Creditors Voluntary Liquidation. Part 2: Executive Summary The total remuneration for this appointment is estimated to be $15,000 (excluding GST).This is consistent with our previous estimated total remuneration communicated to the director of the Company. Remuneration currently claimed is summarised below: Period Report Reference Amount (ex GST) Resolution 1: 27 February 2018 to Finalisation Sch 1 $15,000 TOTAL remuneration claimed and approved $15,000 Approval for internal disbursements is also being sought for the liquidation. The basis for these disbursements is outlined in part 4 of this report. Please refer to report section references detailed in the above table for full details of the calculation and composition of the remuneration approval sought. Part 3: Remuneration 3.1 Remuneration claim resolutions We will be seeking approval of the following resolution to approve our remuneration. Details to support the resolution is included in section 3.2 and in the attached Schedule. Resolution 1 from 27 February 2018 to Finalisation That the remuneration of the Liquidators from 27 February 2018 to Finalisation is determined at a sum equal to the costs of time spent by the Liquidator, and his partners and staff, calculated in accordance with the Liquidators firm s hourly rates that will be increased at a rate of 7.5% at 1 July each year, up to a capped amount of $15, exclusive of GST and outlays, and that the Liquidator can draw the remuneration on a monthly basis or as required, from assets of the Company. 3.2 Details of remuneration The basis of calculating the remuneration claims are summarised below and the details of the major tasks performed and the costs associated with each of those major tasks are contained in Schedule 1. Resolution 1 from 27 February 2018 to Finalisation The below table sets out the expected costs for the major tasks likely to be performed by the Joint and Several Liquidators and our staff for the period 27 February 2018 to Finalisation which is the basis of the Resolution 1 claim. More detailed descriptions of the tasks likely to be performed within each task area, matching the amounts below, are contained in Schedule 1.

21 Task Area Total ($) Admin Assets Reports Creditors Employees Dividends Invest. Total estimate $15, $2, $5, $2, $2, $1, $1, $1, GST $1, Total (Incl. GST) $16, Likely impact on dividends The Corporations Act sets the order for payment of claims against the company and it provides for remuneration of the Joint and Several Liquidators to be paid in priority to other claims. This ensures that when there are sufficient funds, the Joint and Several Liquidators receive payment for the work done to recover assets, investigate the company s affairs, report to creditors and ASIC and distribute any available funds. Even if creditors approve our remuneration, this does not guarantee that we will be paid, as we are only paid if sufficient assets are recovered. Any dividend to creditors will also be impacted by the amount of assets that we are able to recover and the amount of creditor claims that are admitted to participate in any dividend, including any claims by priority creditors such as employees. We are unable to provide a dividend estimate of any certainty at this stage of the Creditors Voluntary Liquidation. If we do declare a dividend, any creditor whose claim has not yet been admitted will be contacted and asked to submit a proof of debt. Part 4: Disbursements Disbursements are divided into three types: Externally provided professional services - these are recovered at cost. An example of an externally provided professional service disbursement is legal fees. Externally provided non-professional costs - these are recovered at cost. Examples of externally provided nonprofessional costs are travel, accommodation and search fees. Internal disbursements such as photocopying, printing and postage. These disbursements, if charged to the Liquidation, would generally be charged at cost; though some expenses such as telephone calls, photocopying and printing may be charged at a rate which recoups both variable and fixed costs. The recovery of these costs must be on a reasonable commercial basis. Details of the basis of recovery of each of these costs are discussed below. We have undertaken a proper assessment of disbursements claimed for Stone Benches Pty Ltd in accordance with the law and applicable professional standards. We are satisfied that the disbursements claimed are necessary and proper. We will be seeking creditor approval to pay our internal disbursements from creditors.

22 4.1 Basis of Internal Disbursements Disbursements provided by our firm will be charged to the liquidation on the following basis: Internal disbursements Courier Postage (large) Postage (small) Fax (interstate) Fax (local) Staff vehicle use Rates applicable for financial year ending 30 June 2018 Rate (excl. GST) At cost $1.91 / page $0.99 / page $2 / page $1 / page $0.66 / km Part 5: Queries If you have any queries in relation to the information in this report, please contact our Kegan Nash of our office on or alternatively by at kegan.nash@au.gt.com. You can also access information which may assist you on the following websites: ARITA at ASIC at (search for insolvency information sheets ). Part 6: Approval of remuneration and internal disbursements In summary, approval of the following proposals is being sought: Resolution 1: Resolution 2: That the remuneration of the Liquidators from 27 February 2018 to Finalisation is determined at a sum equal to the costs of time spent by the Liquidator, and his partners and staff, calculated in accordance with the Liquidators firm s hourly rates that will be increased at a rate of 7.5% at 1 July each year, up to a capped amount of $15, exclusive of GST and outlays, and that the Liquidator can draw the remuneration on a monthly basis or as required, from assets of the Company. That the Liquidators be hereby authorised to charge internal disbursements of their firm to assist with carrying out the duties in relation to the external administration at the rates set out in the Initial Remuneration Advice Enclosed is a Notice of Proposal to creditors form for the above resolutions. We would be grateful if you would complete the form and return it to this office by no later than Friday, 6 April The form can be returned by way of: kegan.nash@au.gt.com Facsimile: Mail: GPO Box 1008, Brisbane QLD 4001 SHAUN MCKINNON JOINT AND SEVERAL LIQUIDATOR Tuesday, 13 March 2018

23 Schedule 1 Resolution 1 Table of major tasks for remuneration The below table provides a description of the work undertaken in each major task area for the period 27 February 2018 to Finalisation. Task Area General Description Includes Sale of Business as a Going Liaising with purchasers Concern Plant and Equipment Liaising with valuers, auctioneers and interested parties Reviewing asset listings Assets subject to specific All tasks associated with realising a charged asset charges Assets $5,000 Debtors Correspondence with debtors Reviewing and assessing debtors ledgers Liaising with debt collectors and solicitors Stock Conducting stock takes Reviewing stock values Liaising with purchasers Creditors $2,500 Other Assets Leasing Creditor Enquiries, Requests & Directions Retention of Title Claims Secured creditor reporting Creditor reports Dealing with proofs of debt Meeting of Creditors Tasks associated with realising other assets Reviewing leasing documents Liaising with owners/lessors Tasks associated with disclaiming leases Receive and respond to creditor enquiries Maintaining creditor request log Review and prepare initial correspondence to creditors and their representatives Documenting Considering reasonableness of creditor requests Obtaining legal advice on requests Documenting reasons for complying or not complying with requests or directions Compiling information requested by creditors Search to the PPSR register Notify PMSI creditors identified from PPSR register Receive initial notification of creditor s intention to claim Provision of retention of title claim form to creditor Receive completed retention of title claim form Maintain retention of title file Meeting claimant on site to identify goods Adjudicate retention of title claim Forward correspondence to claimant notifying outcome of adjudication Preparation of payment vouchers to satisfy valid claim Preparation of correspondence to claimant to accompany payment of claim (if valid) Notifying PPSR registered creditors of appointment Preparing reports to secured creditor Responding to secured creditor s queries Preparing Statutory Report by Liquidator Receipting and filing POD when not related to a dividend Corresponding with OSR and ATO regarding POD when not related to a dividend Preparation of meeting notices, proxies and advertisements Forward notice of meeting to all known creditors Preparation of meeting file, including agenda, certificate of postage, attendance register, list of creditors, reports to creditors, advertisement of meeting and draft minutes of meeting. Preparation and lodgement of minutes of meetings with ASIC Responding to stakeholder queries and questions immediately following meeting

24 Task Area General Description Includes Proposals to Creditors Preparing proposal notices and voting forms Forward notice of proposal to all known creditors Reviewing votes and determining outcome of proposal Preparation and lodgement of proposal outcome with ASIC Employees enquiries Receive and follow up employee enquiries via telephone Maintain employee enquiry register Review and prepare correspondence to creditors and their representatives via facsimile, and post Preparation of letters to employees advising of their entitlements and options available Receive and prepare correspondence in response to employee s objections to leave entitlements FEG Correspondence with FEG Preparing notification spreadsheet Preparing FEG quotations Completing FEG questionnaires Calculation of entitlements Calculating employee entitlements Reviewing employee files and company s books and records Reconciling superannuation accounts Reviewing awards Liaising with solicitors regarding entitlements Employee dividend Correspondence with employees regarding dividend Employees Correspondence with ATO regarding SGC proof of debt $1,000 Calculating dividend rate Preparing dividend file Advertising dividend notice Preparing distribution Receipting POD Adjudicating POD Ensuring PAYG is remitted to ATO Workers compensation claims Review insurance policies Receipt of claim Liaising with claimant Liaising with insurers and solicitors regarding claims Identification of potential issues requiring attention of insurance specialists Correspondence with insurer regarding initial and ongoing workers compensation insurance requirements Correspondence with previous brokers Other employee issues Correspondence with Child Support Investigation $1,000 Conducting investigation Litigation / Recoveries ASIC reporting Correspondence with Centrelink Collection of company books and records Reviewing company s books and records Review and preparation of company nature and history Conducting and summarising statutory searches Preparation of comparative financial statements Preparation of deficiency statement Review of specific transactions and liaising with directors regarding certain transactions Liaising with directors regarding certain transactions Preparation of investigation file Lodgement of investigation with the ASIC Preparation and lodgement of supplementary report if required Internal meetings to discuss status of litigation Preparing brief to solicitors Liaising with solicitors regarding recovery actions Attending to negotiations Attending to settlement matters Preparing statutory investigation reports Preparing affidavits seeking non-lodgement assistance Liaising with ASIC

25 Task Area General Description Includes Processing proofs of debt Preparation of correspondence to potential creditors inviting lodgement of POD Receipt of POD Maintain POD register Adjudicating POD Request further information from claimants regarding POD Preparation of correspondence to claimant advising outcome of adjudication Dividend $1,000 Dividend procedures Preparation of correspondence to creditors advising of intention to declare dividend Advertisement of intention to declare dividend Obtain clearance from ATO to allow distribution of company s assets Preparation of dividend calculation Preparation of correspondence to creditors announcing declaration of dividend Advertise announcement of dividend Preparation of distribution Preparation of dividend file Preparation of payment vouchers to pay dividend Preparation of correspondence to creditors enclosing payment of dividend Administration $2,000 Correspondence Document maintenance/file review/checklist Insurance Bank account administration ASIC Form 524 and other forms ATO and other statutory reporting Finalisation Planning / Review Books and records / storage General correspondence First month, then six monthly liquidation reviews Filing of documents File reviews Updating checklists Identification of potential issues requiring attention of insurance specialists Correspondence with insurer regarding initial and ongoing insurance requirements Reviewing insurance policies Correspondence with previous brokers Preparing correspondence opening and closing accounts Requesting bank statements Bank account reconciliations Correspondence with bank regarding specific transfers Preparing and lodging ASIC forms including 505, 524, 911 etc Correspondence with ASIC regarding statutory forms Notification of appointment Preparing any lodgements Notifying ATO of finalisation Cancelling ABN / GST / PAYG registration Completing checklists Finalising WIP Discussions regarding status of liquidation Dealing with records in storage Sending job files to storage

26 Tuesday, 13 March 2018 NOTICE OF PROPOSAL TO CREDITORS STONE BENCHES PTY LTD (IN LIQUIDATION) ACN ( the Company ) Proposal for creditor approval That the remuneration of the Liquidators from 27 February 2018 to Finalisation is determined at a sum equal to the costs of time spent by the Liquidator, and his partners and staff, calculated in accordance with the Liquidators firm s hourly rates that will be increased at a rate of 7.5% at 1 July each year, up to a capped amount of $15, exclusive of GST and outlays, and that the Liquidator can draw the remuneration on a monthly basis or as required, from assets of the Company. Reasons for the proposal and the likely impact on creditors passed The proposal is a request to creditors for approval of our remuneration. If our remuneration is approved, we will draw these funds from current and future funds available. This will reduce the dividend payable (if any) to creditors of the Company. Failure to approve remuneration via circular resolution means that we shall be required to call a meeting of creditors to seek approval of our remuneration. This action will result in additional fees and costs for which we shall seek approval. Vote on proposal Creditors have the option of approving, not approving or objecting to the proposal being resolved without a meeting of creditors. Please select the appropriate Yes, No or Object box referred to below: Yes I approve the proposal No I do not approve the proposal Object I object to the proposal being resolved without a meeting of creditors Your claim against the Company must be admitted for the purposes of voting by the Creditors Voluntary Liquidation for your vote to count. Please select the option that applies: I have previously submitted a proof of debt form and supporting documents I have enclosed a proof of debt form and supporting documents with this proposal form Creditor details Name of creditor: ACN / ABN (if applicable): I am not a related creditor of the Company. I am a related creditor of the Company, relationship:. Address: Name of creditor / authorised person: Signature: Date: Please complete this document and return with any supporting documents by no later than 6 April 2018 for your vote to be counted, by to Kegan Nash at kegan.nash@au.gt.com. If you have any questions please call (07) Completed forms may also be sent by post attention to Kegan Nash at GPO Box 1008, Brisbane QLD 4001, although you should ensure this is sent with sufficient time to arrive by the date the vote closes, which we cannot guarantee.