April, May & June 2022 Status Report
31 May 2022
Business Rescue Status Report
ORTHOTOUCH (PTY) LIMITED (“the Company”) REGISTRATION NUMBER 2010/004096/07
ZEPHAN PROPERTIES (PTY) LIMITED (“the Company”) REGISTRATION NUMBER 2003/020174/07
In terms of Section 132(3) (a) and (b) (i) of the Companies Act No 71 of 2008 (“the Companies Act”)
(“April, May & June 2022 Status Report”)
To Whom It May Concern,
The Companies Act 71 of 2008, as amended, and more specifically section 132(3) thereof, provides that where a company’s business rescue proceedings have not ended within three months after the start of those proceedings, the practitioner must prepare a report on the progress of the business rescue proceedings and update it at the end of every subsequent month until the end of those proceedings. The report must be delivered to all affected persons.
BUSINESS RESCUE PROCEEDINGS:
1. Commencement of Business Rescue: 7 November 2019.
2. Appointment of Business Rescue Practitioner (BRP) – J du Toit: 14 November 2019.
3. First Meeting of Employees: 27 November 2019
4. First Meeting of Creditors: 28 November 2019
5. Business Rescue Plan filing date: 31 March 2020
6. Second creditors meeting: to be held once a final judgement is granted in regard to the Declaratory order sought by the BRP.
1. Continuance of the Business
a. I can confirm that I am constantly engaging with the officers of Orthotouch and Zephan in ensuring the continuance of the business in the absence of Nic Georgiou.
b. We have restructured the admin duties and functions. DTB has appointed an independent management company to oversee the remaining properties which has already shown an increase in monthly income. We continue to engage with them in regard to the running of the properties and the collection of rental income.
c. The shareholder trust has identified the replacement director and the appointment is in process.
2. The appointment of an Executor for the Estate Late of Nic Georgiou was appointed and I am engaging with the Executor representative to the extent that may be necessary. The original executor has passed away but the new appointment has taken place.
3. Proposer Involvement
a. In terms of the proposed business rescue plan regarding the issuing of shares as an option in the Business Rescue Plan, I wish to confirm that I have engaged with the representative of the proposer who gave me their commitment that they are committed in making the shares available as a payment method to purchase claims as proposed in the BR Plan.
b. Such commitment has been confirmed in writing in February 2022.
c. The Proposer will be FICA’d by an independent law firm as well as auditing firm to ensure its independency, this will include ensuring that the Proposer has sufficient means to offer said shares.
d. The Proposer will buy shares and deposit them into a vault on the Compushare system, from where they will be released to creditors should a creditor chose to sell their claim. This option will only be available upon the approval of the BR Plan and the subsequent court sanctioning.
e. Negotiations regarding the online portal which will be used for the verification of creditors and will allow them to sell their claim in exchange for shares if they wish to, has been completed and a draft portal has been constructed. The legal team is currently verifying the process and the documentation surrounding same. This same online portal will be used for the voting process regarding the Business Rescue Plan.
f. Once this system is in place, notifications will be issued to all creditors with instructions on how to proceed.
a. As previously stated, we are permanently engaging with the auditor in finalising the financial statements.
b. The auditor is constantly in the process of updating the AFS to get same up to date. My advices in this regard will follow in due course.
c. It is our intention to finalise the AFS to date as soon as possible.
d. We are currently engaging with SARS on this matter however we need to finalise all financials to date before we can file the AFS for Orthotouch and Zephan.
e. For both Orthotouch and Zephan to be updated, the shareholders and the connection to the shareholders also need to be updated as a group to finalise the intercompany loans and group entities in conjunction with the Companies.
5. I continue, as always, to exercise my duties as Business Rescue Practitioner and remain in control of the businesses and assets of the Business Rescue Companies.
1. As advised in previous reports, certain attorneys persist with litigation in flagrant disregard of the provisions of Chapter 6 of the Companies Act, and the moratorium against legal action as regulated by Section 133 of the Companies Act. I will continue to vigorously oppose and defend this legal action duly represented by the Companies’ legal team.
CLASS ACTION LITIGATION
2. Litigation continues with the Applicants and Respondents having to file papers according to set timelines whereafter a court date shall be applied for the application to be heard. Theron filed a notice to postpone to a date to be set and the court afforded such extension.
3. Declarator Application
The application continues to be opposed, the opposing parties have filed and served their papers. The replying affidavit was finalised, signed and I have received confirmation that it has been filed at court and served on the other parties.
I wish to confirm that we were requested to apply for the respondents to be combined as a group. This application was done based on a cost saving initiative. It is not as Theron’s reports which state that he and other parties were removed from the declarator list. All parties are included and no party has been excluded or removed from same.
My further advise will follow in this regard. As a reminder, this application is for the purposes of obtaining clarity in regard to the applicability of the Scheme of Arrangement and the rights of the creditors going forward.
4. Condonation Application to the Declarator
It was demanded that we submit a condonation application due to the late filing of the replying affidavit. The information received was excessive and we therefore required more time to work through such information in finalising the replying affidavit. We are in the process of finalising the replying affidavit to the condonation application. We have a court date for the 5th and 6th October 2022.
5. The Litigation status report, in terms of the Companies Act, pertaining to all litigation matters has been published in terms of the Companies Act and is available inter alia via the Orthotouch *website.
HIGHVELD SYNDICATION INVESTORS / SHAREHOLDERS:
For all enquiries relating to investments, the following contact details are available:
Administrative Manager: Sanja Elzerman
Jacques Du Toit
Director & Senior Business Rescue Practitioner
DTB Business Rescue
B.Proc, Dip. Tax, Attorney, Notary, Conveyancer