MASONITE (AFRICA) (PROPRIETARY) LIMITED (Reg. No. 1942/015502/06) (in business rescue) (Hereinafter referred to as the Company )

Transcription

1 MASONITE (AFRICA) (PROPRIETARY) LIMITED (Reg. No. 1942/015502/06) (in business rescue) (Hereinafter referred to as the Company ) TO CREDITORS, EMPLOYEES AND SHAREHOLDERS NOTICE OF THE PUBLICATION OF THE BUSINESS RESCUE PLAN AND OF THE MEETING IN TERMS OF SECTION 150 AND 151 OF THE COMPANIES ACT All affected persons are hereby notified that a meeting of Creditors and Shareholders will be held on 16 May 2016 at 10h00 at Deloitte, DTT House, 2 Pencarrow Park, La Lucia Ridge Office Estate, Pencarrow, La Lucia, Durban for the purpose of considering and voting on the proposed Business Rescue Plan published on 6 May A Skype or teleconference link will be provided for the meeting. Details on the facility and dialin details can be obtained from the Company Secretary, Morgan Govender on MGovender@masonite.co.za after 11 May The complete Business Rescue Plan (the Plan ) comprises approximately 320 pages. Consequently it cannot be transmitted per . The complete Business Rescue Plan can be found on the Masonite website: under the business rescue tab, alternatively click on the following link: MASONITE BUSINESS RESCUE PLAN.pdf to download. In addition, copies of the Plan are available at the following venues for inspection: 2.1 The Business Rescue Practitioner s offices : Berrangé Inc, Suite 9, 2 nd Floor, Block C, Townbush Office Park, Townbush Road, Pietermaritzburg; 2.2 Masonite s head office at : Suite 200, Block 2, Island Office Park Island Circle Riverhorse Valley 2.3 Masonite s factory premises at: Broomcliffe Road, Estcourt 3. Please note that the agenda and purpose of the meeting is to: -

2 2 3.1 present the Business Rescue Plan; 3.2 inform the meeting whether or not the Business Rescue Practitioner continues to believe that there is a reasonable prospect of rescuing Masonite; 3.3 provide employees and/or their representatives with an opportunity to address the meetings; 3.4 invite discussions, and entertain and conduct a vote, on any motions to (i) amend the Business Rescue Plan, in any manner moved and seconded by holders of creditors voting interest (and satisfactory to the Business Rescue Practitioner); or (ii) adjourn the meeting, in order to revise the Business Rescue Plan for further consideration; 3.5 thereafter the BRP will call for a vote by Creditors for preliminary approval of the Plan, as amended if applicable, unless the Meeting has been adjourned; 3.6 the Plan will be approved on a preliminary basis if it is supported by the holders of more than 75% of the Creditors voting interest that are voted and the votes in support of the Plan includes at least 50% of the independent Creditors voting interests, if any, that are voted; 3.7 if the Plan is approved by Creditors as set forth above, the Creditors will thereafter be requested to consider and vote in respect of the success fee agreement proposed by the BRP. The success fee agreement will become final and binding on the Company if it is approved by the holders of a majority of the Creditors voting interests present and voting at the Meeting, provided the success fee agreement is also approved by a majority of the Shareholders voting rights; 3.8 after the abovementioned voting by Creditors, the Meeting will be closed insofar as Creditors are concerned and immediately thereafter, a Meeting of Shareholders will be held and they will be called upon to approve the adoption of the Plan, if the Plan was approved by the Creditors; 3.9 if the majority of the voting rights of the Shareholders that were exercised support adoption of the Plan, the Plan will be finally adopted, subject to satisfaction of any conditions on which the Plan is contingent; 3.10 if the majority of the voting rights of the Shareholders that were exercised oppose adoption of the Plan, the Plan is rejected and may be considered further only in terms of section 153 of the Act;

3 3.11 if the Plan is approved by the Creditors and the Shareholders as set forth above, the Shareholders will thereafter be called upon to consider and vote in respect of the success fee agreement proposed by the BRP. The success fee agreement will become final and binding on the Company if it is approved by the holders of a majority of the voting rights attached to the shares, present and voting at the Meeting; after the Shareholders have voted as set forth above, the Meeting of Shareholders will be closed; 3.13 if the Plan is adopted, it is binding on the Company and on each of the Creditors and every Shareholder, whether or not such a person was present at the Meeting, voted in favour of the adoption of the Plan or, in the case of Creditors had proven their claim against the Company. 4. In accordance with Section 145(4) of the Act, a creditor [including any employee who is a creditor in terms of Section 144(3)(f)] is entitled to vote as follows :- 4.1 a secured or unsecured creditor has a voting interest equal to the value of the amount owed to that creditor by Masonite; 4.2 a concurrent creditor who would be subordinated in a liquidation has a voting interest, as independently and expertly appraised and valued at the Business Rescue Practitioner s request, equal to the amount, if any, that the creditor could reasonably expect to receive in a liquidation of Masonite. 5. The Business Rescue Plan contemplates the following inter-dependent transactions (collectively referred to as the rescue transactions ) : The sale of the Company s forestry business to World Hardwood (Pty) Limited ( Forestco ) for the sum of R385 million in terms of a Forestry Sale of Business Agreement; 5.2 The conclusion of a Subscription Agreement between the Company and Grey West Fencing (Pty) Ltd ( Millco ) in terms whereof Millco will subscribe for ordinary shares in the Company at a subscription consideration of R ; 5.3 The sale of the plant and equipment of the Mill to Warhorse Private Equity (Pty) Ltd ( Assetco ) for the sum of R in terms of a Sale of Plant and Equipment Agreement; 5.4 The repurchase by the Company of its entire issued share capital other than the shares subscribed for by Millco, with the result that Millco shall be the sole

4 4 shareholder of the Company. Repurchase Transaction. This transaction is described as the Share The BRP is of the opinion that the bidder who was selected as the preferred bidder and with whom the rescue transactions were concluded, presented the bid most beneficial to the Company s Creditors, employees and Shareholders as: (i) (ii) (iii) (iv) (v) It provides for the purchase of the Company s assets at an attractive price (value); It has funding certainty and limited conditionality; It is structured in such a manner that the Mill will continue to operate; All the Company s employees will remain employed; The preferred bidder has the necessary experience and expertise to carry on the Company s forestry business and to operate the Mill. 6. The effect of the Business Rescue Plan on the following Affected Persons, are as follows : 6.1 Creditors All Creditors claims will be paid in full. 6.2 Employees Those employees of the Company who were employed in the Company s forestry division, shall be transferred to Forestco as contemplated in section 197 of the Labour Relations Act; Those employees who were employed in the Mill, will continue their employment with the Company; 6.3 Shareholders The rescue transactions provides a compulsory repurchase by the Company of all its issued share capital, other than the Millco subscription shares. The salient terms of the Share Repurchase Transaction are: The Company s present Shareholders shall be obliged to sell their shares to the Company in return for payment of a repurchase price calculated in accordance with a specified formula The BRP, acting either in his capacity as BRP or as Receiver as contemplated, shall pay the share repurchase price from the funds held in a Share Repurchase Price Settlement Account opened by the BRP for the purpose of receiving and holding all the amounts allocated to payment of the share repurchase price and for payment of the amount required to ensure compliance with the Company s obligations in respect of the postemployment healthcare benefits;

5 The share repurchase price shall be paid to the present Shareholders prorata to their shareholdings as follows: An initial payment to be made as soon as reasonably possible, but no later than thirty days, after the first registration date of not less than 85% of the Company s immovable properties into the name of World Hardwood (Pty) Limited; Further payments as monies are received into the Share Repurchase Price Settlement Account until each Shareholder has received full payment of the share repurchase price; The total anticipated price per share payable to Shareholders shall be circa R33.00 per share; Shareholders are referred to annexure BRP13 of the Plan, which document sets out the action(s) to be taken by all Shareholders to secure payment of the share repurchase price; Shareholders are reminded that trading in the Company s shares on the JSE has been suspended and remain suspended; Following the share repurchase, Shareholders, with the exception of Millco once it is a Shareholder, shall not be entitled to exercise any rights pertaining to their shares and the Shareholders only remaining right will be to receive any unpaid portion of the share repurchase consideration. 7. Neither this letter nor the Plan should be considered to be legal advice. Affected persons should seek independent legal advice in respect of their claim and their rights. 8. The following documents are attached: 8.1 Proxy Form for Creditors; 8.2 Proxy Form for Shareholders; (Proxies are to be returned by no later than 12h00 on 12 May 2016 to MGovender@masonite.co.za) 8.3 Ballot Form for purposes of voting at the meetings for Creditors; 8.4 Ballot Form for purposes of voting at the meetings for Shareholders. Pierre de Villiers Berrangé Senior Business Rescue Practitioner Date : 05 May 2016

6 MASONITE (AFRICA) (PROPRIETARY) LIMITED (Reg. No. 1980/009682/07) (in business rescue) FORM OF PROXY CREDITORS For use by Creditors at the Meeting to consider the proposed Business Rescue Plan ( the Plan ), and any proposed amendments thereto, for Masonite (Africa) (Pty) Ltd (in business rescue), which meeting is to be held at 10:00 on 16 May 2016 at Deloitte, DTT House, 2 Pencarrow Park, La Lucia Ridge Office Estate, Pencarrow, La Lucia, Durban. I/We in my/our capacity as of ( the Creditor ) being a secured creditor * and/or concurrent creditor * (delete inapplicable) of the Company, do hereby appoint : 1. or failing him; 2. or failing him; 3. The Chairman of the meeting, 6 As proxy to act for and on behalf of the Creditor at the meeting which will be held for the abovementioned purpose and at any adjournment thereof, and to vote in respect of the proposed Plan or any proposed amendments thereto in accordance with the following instructions: 1. Vote for the adoption of the Proposed Plan, as amended, if necessary 2. Against the adoption of the Proposed Plan, as amended, if necessary 3. Vote for the adoption of the Proposed Success Fee as amended, if necessary 4. Against the adoption of the Proposed Success Fee as amended, if necessary Signed at on (Signature) Notes: A Creditor may insert the name of a proxy or the names of one alternative proxy of his choice in the space provided, with or without deleting the Chairman of the meeting. 1. Forms of proxy must be lodged with the Company Secretary, Masonite (Africa) Limited Suite 200, Block 2, Island Office Park, Island Circle, Riverhorse Valley, Morgan Govender, MGovender@masonite.co.za or the Chairman, on address : taryn@b-inc.co.za 2. The completion and lodging of this form of proxy will not preclude the relevant creditor from attending the meeting and speaking and voting thereat to the exclusion of the proxy appointed in terms hereof, should such creditor wish to do so.

7 MASONITE (AFRICA) (PROPRIETARY) LIMITED (Reg. No. 1980/009682/07) (in business rescue) FORM OF PROXY SHAREHOLDERS For use by Shareholders at the meeting to consider the proposed Business Rescue Plan ( the Plan ), and any proposed amendments thereto, for Masonite (Africa) (Pty) Ltd (in business rescue), which meeting is to be held at 10:00 on 16 May 2016 at Deloitte, DTT House, 2 Pencarrow Park, La Lucia Ridge Office Estate, Pencarrow, La Lucia, Durban. I/We in my/our capacity as of ( the Shareholder ) being a Shareholder of the Company, do hereby appoint: 1. or failing him; 2. or failing him; 3. The Chairman of the meeting, As proxy to act for and on behalf of the Shareholder at the meeting which will be held for the abovementioned purpose and at any adjournment thereof, and to vote in respect of the proposed Plan or any proposed amendments thereto in accordance with the following instructions: 7 1. Vote for the adoption of the Proposed Plan, as amended, if necessary 2. Against the adoption of the Proposed Plan, as amended, if necessary 3. Vote for the adoption of the Proposed Success Fee as amended, if necessary 4. Against the adoption of the Proposed Success Fee as amended, if necessary Signed at on (Signature) Notes: A Shareholder may insert the name of a proxy or the names of one alternative proxy of his choice in the space provided, with or without deleting the Chairman of the meeting. 3. Forms of proxy must be lodged with the Company Secretary, Masonite (Africa) Limited Suite 200, Block 2, Island Office Park, Island Circle, Riverhorse Valley, Morgan Govender, MGovender@masonite.co.za or the Chairman, on address : taryn@b-inc.co.za 4. The completion and lodging of this form of proxy will not preclude the relevant creditor from attending the meeting and speaking and voting thereat to the exclusion of the proxy appointed in terms hereof, should such creditor wish to do so.

8 8 MASONITE (AFRICA) LIMITED ( IN BUSINESS RESCUE ) VOTING BALLOT FOR THE PROPOSED BUSINESS RESCUE PLAN CREDITOR S NAME CLAIM AMOUNT MARK VOTE WITH CROSS A : FOR THE PLAN PROPOSED BUSINESS RESCUE PLAN: FIRST PROPOSED AMENDMENT: SECOND PROPOSED AMENDMENT: B : FOR THE BUSINESS RESCUE PRACTITIONERS SUCCESS FEE PROPOSED BRP FEE : FIRST PROPOSED AMENDMENT: SIGNATURE Duly Authorised by Creditor CAPACITY

9 9 MASONITE (AFRICA) LIMITED ( IN BUSINESS RESCUE ) VOTING BALLOT FOR THE PROPOSED BUSINESS RESCUE PLAN NAME SHAREHOLDER S SHAREHOLDING HINN / SRN NO. NO. OF SHARES HELD MARK VOTE WITH CROSS A : FOR THE PLAN PROPOSED BUSINESS RESCUE PLAN: FIRST PROPOSED AMENDMENT: SECOND PROPOSED AMENDMENT: B : FOR THE BUSINESS RESCUE PRACTITIONERS SUCCESS FEE PROPOSED BRP FEE : FIRST PROPOSED AMENDMENT: SIGNATURE Duly Authorised by Shareholder CAPACITY