BRISBANELevel 19, Waterfront Place, 1 Eagle Street,Brisbane QLD 4000GPO Box 98,Brisbane QLD 4001ABN: 82 098 443 397MELBOURNE | SYDNEY | PERTH | BRISBANE | CORCORDIS.COM.AULiability limited by a scheme approved under Professional Standards LegislationOur Ref: MJ/MW/EB/CUD960 – 7 19 May 2020NOTIFICATION TO SHAREHOLDERSCUDECO LIMITED (RECEIVERS AND MANAGERS APPOINTED) (IN LIQUIDATION)ACN 000 317 251 (the Company)We refer to the above administration and to our Circular to Shareholders dated 22 April 2020.The Company is now in liquidationAt a meeting of creditors of the Company held on 7 April 2020, a resolution was passed that the Deed of Company Arrangement (DOCA) proposal, as set out in our Report to Creditors dated 30 March 2020, be accepted.Employees at the eligible employee creditors’ meeting, which was also held on 7 April 2020, did not pass a resolution agreeing to adjust the statutory priorities for payment of their entitlements pursuant to the proposed DOCA terms. Accordingly, the Administrators were required to apply to the Court for orders pursuant to section 444DA of the Corporations Act 2001 (the Act) to ratify the adjustment to statutory priorities, as contemplated by the proposed DOCA and as explained in our Report to Creditors dated 30 March 2020. The funding required to prepare and file the application was intended to be received from the post DOCA approval funding to be paid initially to the Receivers. Funding was not released to the Administrators and the intended application to Court was not made. Under section 444B(2) of the Act, the DOCA was required to be executed within 15 business days after the end of the meeting of creditors, that is by close of business on 30 April 2020, or such later date as ordered by the Court. Given that the application to adjust the statutory priorities could not be made, the proposed DOCA was not able to be executed by 30 April 2020 and the Company is deemed to have passed a special resolution under section 491 of the Act that it be wound up voluntarily and Jeremy Nipps and Matthew Joiner have been appointed as liquidators of the Company.What happens next?As advised in our Circular to Shareholders dated 22 April 2020, the Australian Securities and Investments Commission (ASIC) has requested us to provide a supplementary report in regard to the alleged potential director breaches and offences we reported pursuant to section 438D of the Act. As the liquidation is without funds, we will make an application to ASIC for funding to prepare the requested supplementary report and upon receipt of this funding, will report further to ASIC. We will also undertake further investigations into possible recovery actions, potential breaches of Director duties and potential voidable transactions, as identified in our Report to Creditors dated 30 March 2020, including potential preferential payments and insolvent trading claims. Declaration of worthless sharesThe Liquidators declare there are reasonable grounds to believe there will be no distribution to shareholders of the Company. Accordingly, a Declaration of Worthless Shares pursuant to section 104-145 of the Income Tax Assessment Act 1997 (Cth) is enclosed.
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