To all known creditors of: PAR Beteiligungs GmbH ISA Deutschland GmbH Supplies Team GmbH 4 January 2012 Our ref: RLH/ISA/12122011/425 Dear Sirs PAR Beteiligungs GmbH ( PAR ) ISA Deutschland GmbH ( ISA ) Supplies Team GmbH ( Supplies Team ) All in administration (and collectively referred to as the Companies ) In accordance with the requirements of UK insolvency law and further to our dated 13 June 2011, we write to provide an update on the progress of the above administrations, which are main proceedings under the European Regulation on Insolvency Proceedings 2000. 1 Summary You will be aware that the outstanding issue in these main proceedings is the distribution of surplus funds to the unsecured creditors of the Companies. At the time of our previous, we were making arrangements for an application to Court in order for us to be able to formally admit creditor claims and pay the dividends. We are pleased to confirm that the Court granted the order and we are now working towards declaring a first and final dividend to the Companies creditors as soon as possible. Subject to any difficulties due to the lack of information from the Companies records, we currently expect this to be within the next six to nine months. 2 Creditor claims As set out in our dated 28 March 2011, creditor claims fall into one of the following three categories: 1) Claims lodged in the secondary proceedings only; 2) Claims lodged in the main proceedings only; and 3) Claims lodged in both the main and secondary proceedings. PricewaterhouseCoopers LLP, Benson House, 33 Wellington Street, Leeds, LS1 4JP, United Kingdom T: +44 (0) 113 289 4000, F: +44 (0) 113 289 4460, www.pwc.co.uk PricewaterhouseCoopers LLP is a limited liability partnership registered in England with registered number OC303525. The registered office of PricewaterhouseCoopers LLP is 1 Embankment Place, London WC2N 6RH. PricewaterhouseCoopers LLP is authorised and regulated by the Financial Services Authority for designated investment business.
2.1 Claims lodged in the secondary proceedings only These are claims lodged by creditors in the secondary proceedings (under the control of Dr. Kebekus), which have been duly lodged by Dr Kebekus in the main proceedings on behalf of those creditors; as summarised in the following table. PAR 3,025,902.09 Supplies Team 3,129,088.87 ISA 5,193,539.91 We have been in consultation with Dr Kebekus and received legal advice regarding the most appropriate mechanism for distributing funds to these creditors. It has been agreed in principle, that if the main and secondary proceedings are in a position to declare a dividend at the same time, that creditors claiming only in the secondary proceedings, will receive one dividend from Dr. Kebekus, which will include dividends from the main and secondary proceedings. In these circumstances, we would pass the necessary funds from the main proceedings to Dr. Kebekus for those creditors. This strategy will be reviewed, if for any reason, the main and secondary proceedings are not in a position to declare a dividend at the same time, with the likelihood that dividends would be paid directly to all creditors from the main proceedings. 2.2 Claims lodged in the main proceedings only; As previously ed, we have insufficient information with which to adjudicate these claims, therefore we will be seeking the assistance of Dr Kebekus in order to be able to deal appropriately with them. In accordance with our statutory duty, we will lodge these claims in the secondary proceedings on behalf of these creditors, if and when they have been admitted into the main proceedings. Due to the time since our appointment, a thorough review of our files has been necessary to ensure that all possible creditors have been identified. Similar to the above, it has been agreed in principle, that if the main and secondary proceedings are in a position to declare a dividend at the same time, that creditors claiming only in the main proceedings, will receive one dividend from the joint administrators, which will include dividends from the main and secondary proceedings. In these circumstances, Dr Kebekus would pass the necessary funds to us for those creditors. 2 of 9
2.3 Claims lodged in both the main and secondary proceedings Some creditors may have lodged their claims in both the main and secondary proceedings. Prior to any distribution of funds to creditors, any duplicate claims will be excluded from the cross-claims made between Dr. Kebekus and the joint administrators, to avoid any overpayment. Any creditor who has lodged in both proceedings should therefore expect to receive a dividend from both the main and secondary proceedings. 2.4 Summary of the distribution The diagram below summarises the anticipated distribution of funds, in the event that both proceedings can declare a dividend at the same time. As claims in each proceeding are lodged in the other, in order for the body of creditors for dividend calculation purposes to be the same in each proceedings, creditors claiming in both proceedings will have their cross-claim excluded, and therefore receive a dividend from each estate. Main proceedings in the UK Secondary proceedings in Germany Creditors claiming in both proceedings Creditors claiming in the main proceedings only Dividend declared in main proceedings Dividend declared in secondary proceedings Creditors claiming in the secondary proceedings only 2.5 Awaited claims You may recall that, in addition to claims already received, our records contained a large volume of third parties who may also be creditors of the Companies, but have not yet lodged a claim. All these parties will receive a formal notice in due course of our intention to pay a dividend, and if they fail to respond, they will not take part in the distribution. 3 of 9
Our correspondence sent to many of these creditors has returned to us and we therefore recently engaged our solicitors in Germany to trace as many of these creditors as possible. From a total of 414 creditors, the details of approximately 178 have been verified and potential alternative addresses for a further 169 have been provided. These creditors will be contacted again and invited to lodge any claim they may have. We do not intend to make any further enquiries regarding those creditors that our solicitors could not find. 2.6 Received claims As part of our preparations for paying a dividend, we invited creditors to confirm their current contact details, in order to ensure that dividends are paid and received as quickly and effectively as possible. Whilst a number of creditors have responded, we invite those who have yet to reply, to complete the enclosed Form B and return it to Ruth Turner at the address shown on the form. It is still possible that dividends will be paid electronically and therefore Form B requests your bank account details, which we will use if the cost of electronic payment is not prohibitive. Actions required by creditors If you have already submitted a claim, but have not returned Form B, please complete and return it to Ruth Turner at ruth.e.turner@uk.pwc.com, or alternatively: Fax: +44 (0)113 289 4460 Post: PwC, Benson House, 33 Wellington Street, Leeds, LS1 4JP, United Kingdom If you have not yet submitted a claim, please return Forms A and B to the above address, together with the supporting information requested. Dividend prospects The dividend prospects for creditors in the main proceedings only, are currently unchanged from our latest estimates, which are summarised below. PAR ISA Supplies Team Estimated dividend 0.25% 4% 4% Please note that the estimates are sensitive to future costs and agreement of claims on this complex case and the above guidance on dividend prospects is indicative only. It should not be used as the sole or principal basis of any bad debt provision decision. 4 of 9
Receipts and payments A summary of the joint administrators receipts and payments is included in Appendix A for the period 20 May 2011 to 15 November 2011. The accounts exclude transactions made by Dr Kebekus who holds the remainder of the Companies' other realised assets. Administrators remuneration Enclosed at Appendix B is a summary of the administrators time costs for the period since our last to 15 November 2011. These are shown in our local currency (Pounds Sterling). The main areas of work undertaken during the period were: Organising and working on our creditor files; Communications with Dr Kebekus s office regarding creditor claims; Court application for authority to distribute to creditors; Strategy and legal advice regarding the distribution mechanism; Formal ing to creditors; General accounting and treasury duties; and Fulfilling any other periodic statutory or regulatory obligations. Future ing Our next to creditors is due within the next six months, pursuant to the requirements of the Insolvency Act 1986. However, as we move closer to declaring a dividend, we expect to be writing to individual creditors in the near future with regards to their claims. We hope that you have found this useful and ask that if you have any questions you contact Vicky Ryan at vicky.a.ryan @uk.pwc.com in the first instance. Yours faithfully for and on behalf of the Companies pp Gillian Bruce Joint Administrator Gillian Bruce and Ian Green have been appointed joint administrators of the Companies as their agents. Both are licensed in the United Kingdom to act insolvency practitioners by the Institute of Chartered Accountants in England and Wales and act without personal liability. vicky.a.ryan@uk.pwc.com T: +44 (0) 113 289 4418 F: +44 (0) 113 289 4580 5 of 9
Appendix A Receipts and payments accounts for the period 16 May 2003 to 15 November 2011 ISA Deutschland Gm bh (EUR account) Prev ious T his T otal Supplies T eam GmbH (EUR account) Previous T his T otal Receipts Receipts Intercompany debt (Supplies Team s.r.l) 100,000.00-100,000.00 Intercompany debt (Supplies Team s.r.l) - - - Third party funds received - Third party funds received 28,144.59-28,144.59 Loans from group companies 816,015.7 6-816,015.7 6 Loans from group companies - - - Interest received 11,986.7 3 318.22 12,304.95 Interest received 815.99-815.99 Received from Dr Kebekus 808,000.00-808,000.00 Received from Dr Kebekus 7 9,000.00-7 9,000.00 Dividends received 17 2,7 57.09-17 2,7 57.09 Dividends received - - - Intergroup funding (28,000.00) - (28,000.00) Intergroup funding 28,000.00-28,000.00 Currency gains on loan repay ments 59,646.42-59,646.42 Currency gains on loan repayments 24,049.80-24,049.80 1,940,406.00 318.22 1,940,7 24.22 160,010.38-160,010.38 Pay m ents Pay m ents Administrators remuneration 585,186.68-585,186.68 Administrators remuneration 112,157.44-112,157.44 Administrators disbursements 23,444.52-23,444.52 Administrators disbursements 6,065.61-6,065.61 Legal fees and disbursements 17 5,188.83 19,526.53 194,7 15.36 Legal fees and disbursements 12,7 7 5.03-12,7 7 5.03 Repayment of loans 816,015.7 6-816,015.7 6 Repayment of loans - - - Third party funds repaid - - - Third party funds repaid 28,144.59-28,144.59 Bank charges 314.09-314.09 Bank charges 3.7 8-3.7 8 Statutory advertising 1,27 2.53-1,27 2.53 Statutory advertising - - - Postage, stationery and printing 1,851.57 3,006.06 4,857.63 Postage, stationery and printing - - - Value added tax 8,17 7.45 164.94 8,342.39 Value added tax - - - 1,611,451.43 22,697.53 1,634,148.96 159,146.45-159,146.45 Funds in hand 328,954.57 (22,37 9.31) 306,57 5.26 Funds in hand 863.93-863.93 PAR Beteiligungs Gm bh (EUR account) Prev ious T his T otal PAR Beteiligungs GmbH (GBP account) Previous T his T otal Receipts Receipts Interest received - - - Interest received 4,491.66 35.39 4,527.05 Received from Dr Kebekus - - - Received from Dr Kebekus 17 3,907.04-17 3,907.04 Currency gains on loan repay ments 21,910.39-21,910.39 Currency gains on loan repayments - - - 21,910.39-21,910.39 17 8,398.7 0 35.39 17 8,434.09 Pay m ents Pay m ents Administrators remuneration (20,199.32) - (20,199.32) Administrators remuneration 139,601.30-139,601.30 Administrators disbursements (3,309.19) - (3,309.19) Administrators disbursements 8,396.04-8,396.04 Legal fees and disbursements 30,237.45-30,237.45 Legal fees and disbursements - 4,229.7 1 4,229.7 1 Bank charges - - - Bank charges - - - Statutory advertising - - - Statutory advertising - - - Postage, stationery and printing - 37 0.31 37 0.31 Postage, stationery and printing 3,530.16 (1,57 9.85) 1,950.31 Value added tax - - - Value added tax 183.47 (88.21) 95.26 6,7 28.94 37 0.31 7,099.25 151,7 10.97 2,561.65 154,27 2.62 Funds in hand 15,181.45 (37 0.31) 14,811.14 Funds in hand 26,687.7 3 (2,526.26) 24,161.47 Note: receipts and payments for legal and postage costs include intercompany adjustments.
Time costs and disbursements for the period 1 May 2011 to 15 November 2011 Appendix B Sen ior Ma n a ger / Ma n a ger A v er age r a te ( /h r ) Classifica tion of w or k Par tn er / Dir ector Sen ior A ssociate A ssocia te / Su ppor t Total Hou r s Tota l cost Strategy a n d pla n n in g 0.7 0 1.3 5 9.4 0 6.05 1 7.5 0 5,6 6 7.05 3 2 3.8 3 A ccou n tin g a n d tr ea su r y 0.5 0 2.3 0 0.6 0 1 4.7 0 1 8.1 0 4,9 04.1 0 2 7 0.9 4 Statu tor y an d oth er com plia n ce 1.7 0 7.9 5 6.8 0 6.7 0 2 3.1 5 8,9 4 6.3 0 3 8 6.4 5 Claim s a g r eem en t / distr ibu tion s 4.5 0 9.9 0 1 3.4 0 6 1.2 5 8 9.05 2 5,6 3 4.1 5 2 8 7.8 6 Closu r e/ex it r ou tes - - - - - - - Tota l h ou r s 7.4 0 2 1.5 0 3 0.9 0 1 00.7 5 1 6 0.5 5 4 8,03 5.3 5 2 9 9.1 9 Tota l cost ( ) 4,8 7 6.9 0 1 0,3 3 6.6 0 1 0,5 7 8.3 0 2 2,2 4 3.5 5 4 8,03 5.3 5 A v er a ge h ou r ly r ate ( /h r ) 6 5 9.04 4 8 0.7 7 3 4 2.3 4 2 2 0.7 8 2 9 9.1 9 Charge-out rates (w ith effect from 1 May 2011: /hour) 730 / 641 494 / 415 347 / 257 221 / 110 A dm inist rators disbu rsem ent s from 1 Ma y 2011 t o 15 Nov em ber 2011 Ph otocopy in g : ch a r g ed for cir cu la r s to cr editor s a n d oth er bu lk copy in g on ly a t 3 p per sh eet - Mileage (in th e UK) - at a m a xim u m of 5 0p per m ile (u p to 2,000cc) or 7 0p per m ile (ov er 2,000cc) - Mileage (ou tside th e UK) - a t a m a x im u m of 0.4 2 per km - A ll oth er disbu r sem en ts to be r eim bu r sed at cost. Stor age costs 1.8 7 Tax i fa r es - Rail fa r es 9 6.00 A ir Fa r es - T ot a l 97.87
PAR Beteiligungs GmbH ISA Deutschland GmbH Supplies Team GmbH ( the Companies ) FORM A Section 1.... Name of supplier / creditor Please tick box A or B The above company does not wish to make a claim against any of the Companies* A *your company will be removed from our mailing list. A claim is hereby lodged as shown below (please complete Section 2) B Section 2 (for creditors wishing to lodge a claim) PAR Beteiligungs GmbH Enter the total amount of your ISA Deutschland GmbH claim, including any VAT at the date of Provide details of any documents that substantiate your claim, any security for your debt and evidence what goods and services you provided. Supplies Team GmbH the administration order. If relevant, please attach a statement of account. Creditor s name and address: Email address: Telephone: Fax: Signature of creditor or person authorised to act on behalf of the creditor: Name in block capitals: Position with or relation to the creditor (e.g. director, company secretary, solicitor):
FORM B Please tick Return this form to one of the following: PAR Beteiligungs GmbH Email: ruth.e.turner@uk.pwc.com ISA Deutschland GmbH Fax: +44 (0)113 289 4460 Supplies Team GmbH Post: (See address on first page) Section 1 (claim details).... Name of supplier / creditor.. Value of claim Section 2 (contact details) Creditor s name and address: Email address: Telephone: Fax: Signature of creditor or person authorised to act on behalf of the creditor: Name in block capitals: Position with or relation to the creditor (e.g. director, company secretary, solicitor): Section 3 (payment details) Account name: SWIFT code: IBAN: Bank: Bank address: