Well here it is:
Report on liquidation of IGE by KPMGNot a happy story.Some highlights:
(a) As discussed in Section 4, Fandola is an entity related to Mr Dickson and has submitted a POD in the liquidation
for $33,163,769.
The POD primarily relates to debts owed under a “Success Fee Agreement” arising from a number of loans
advanced by Fandola to the Company and unpaid director fees. My preliminary review reveals that the interest
rate applied on the loans was 8% per month
(96% per annum) which was subsequently reduced to 1% per
month (12% per annum). A breakdown of Fandola’s POD can be found at Section 4.
My investigations into the Fandola claim, including whether the underlying transactions give rise to a possible
claim in the liquidation are continuing.
I note in this regard that on 17 June 2021 (prior to the expiry of the policy), I caused a demand to be issued to the
Company’s current and former officeholders for repayment of $13,081,277 in respect to the following misconduct:
- Excessive business expenses including international business class travel and substantive relocation costs;
- Failure to conduct proper due diligence as to potential funders. I understand the Company was in discussions
with a number of funders to provide funding to the Company. No funding ever eventuated despite protracted
negotiations and monies being paid to the funders;
- Causing incorrect announcements to be made to the ASX which resulted in the suspension of the Company’s
shares. This made it more difficult for the Company to raise new equity funds; and
- The assignment of key intellectual property from the Company to IGE Singapore.
I understand that the Officeholders notified the D&O insurer of my claim prior to the expiry of the policy. I have not yet
received a response from the insurer as to whether they have accepted the claim or whether the policy will respond.
Insolvent trading
Section 588G of the Act provides that directors are obliged to prevent a company from:
– Incurring a debt whilst insolvent; or
– Becoming insolvent by incurring a debt.
If a contravention of Section 588G of the Act can be established, then Section 588M of the Act empowers a Liquidator
(or a creditor under certain circumstances) to recover compensation from a director for any loss or damage suffered
as a consequence of any such contravention.
Section 588R of the Act entitles creditors to commence proceedings against the Director(s) of the Company in their
own right, subject to the consent of the Liquidator.
Final insult;
The Company’s records, including the ROCAP provided by the Officeholders disclose the following receivables owed
to the Company:
Debtor name ROCAP $ Liquidator ERV
$
Solid Energy Technologies Pty Ltd (SET) 4,546,660 Unknown
Total 4,546,660 Unknown
SET is an entity which is controlled by Mr Bevan Dooley, a former director of the Company. I understand that SET
provided engineering design and construction services to the Company in respect to the plastics to fuel plant in
Amsterdam.
Although the ROCAP records a claim against SET in the above amount, its estimated realisable value is recorded as
unknown.
Included with the ROCAP, was an invoice issued by the Company to SET, together with other supporting
documentation. The ROCAP was supplemented with further documents and a 133 page “Report Regarding
Equipment and Documentation Delivered by Bevan Dooley to IGES” provided by Mr Clark to me on 19 August 2021.
This additional information, issued on the Company’s letterhead claims:
- The equipment constructed by SET did not meet the standards for which it is required;
- SET substantially exceeded the budget under its original agreement with the Company; and
- The plastics to fuel modules in Amsterdam will need to be re-engineered or re-built at a cost of approximately
$7M - $13M.The biggest problem is that the liquidator has no funds and has been offered only $75,000 by Macwealth.
No cause for optimism.
