VAC Group Holdings Pty Ltd (Administrators Appointed) and associated - PowerPoint PPT Presentation

VAC Group Holdings Pty Ltd (Administrators Appointed) and associated entities (collectively, the VAC Group) First Meetings of Creditors 28 November 2019 D14-191118-VACGVAC03-First meeting presentation-MM 1

Agenda Opening Meeting formalities  Purpose of meetings  Declaration of Independence, Relevant Relationships and Indemnities ( DIRRI )  Role of the Voluntary Administrators  Voluntary Administration timeline  Vac Group Background  Corporate structure  Creditor claims  D14-191118-VACGVAC03-First meeting presentation-MM 2

Agenda (cont.) Update of Voluntary Administration Administrators’ actions since appointment  Sale and recapitalisation strategy  Creditors  Employees  Strategy going forward  Questions Resolutions Replacement of Voluntary Administrators (if required)  Committee of Inspection  D14-191118-VACGVAC03-First meeting presentation-MM 3

Meetings being held 1. Vac Group Holdings Pty Ltd 2. Beacos Pty Ltd in its own capacity and as trustee of the Beacos Trust 3. Rebirthed Earth Pty Ltd 4. Soil Transfer Pty Ltd 5. Staking U Asia Pacific Campus Pty Ltd 6. Vac Group Employees Pty Ltd 7. Vac Group Operations Pty Ltd 8. Vac-U-Dig Pty Ltd 9. Vac-U-Digga Pty Ltd in its own capacity and as trustee of Vac-U-Digga Trust 10. Vac-U-Digga R & D Pty Ltd 11. VHS IP Pty Ltd 12. Earth Radar Group Pty Ltd 13. Earth Radar Pty Ltd 14. Cosbea Pty Ltd in its own capacity and as trustee of Cosbea Unit Trust D14-191118-VACGVAC03-First meeting presentation-MM 4

Order of the Supreme Court of Queensland The Administrators applied to the Supreme Court of Queensland for certain orders to allow for the orderly and efficient  conduct of the Vac Group Administration. On 22 November 2019, the Supreme Court of Queensland ordered that:  The Voluntary Administrators: – ＞ may hold the first meetings of creditors for the Vac Group concurrently; and ＞ may admit all proofs of debt received by any creditor of the Vac Group for purposes of voting so that creditors are only required to vote once in respect of any resolution put to the meeting. Any advances made under the loan facility provided to the Voluntary Administrators and any other liabilities incurred or – accrued under or in support of the loan facility – including fees, guarantees, indemnities, security, borrowing costs and interest – are liabilities incurred by the Voluntary Administrators in the performance and exercise of their functions and powers as voluntary administrators of the Vac Group ( Liabilities ); if the indemnity in respect of the Liabilities is insufficient to meet such liabilities, the Voluntary Administrators will not be – personally liable to repay the liabilities to the extent of insufficiency. A copy of the Order is tabled at this meeting.  A copy of the Order will be sent to creditors following this meeting by post or email.  D14-191118-VACGVAC03-First meeting presentation-MM 5

Meetings being held concurrently 1. Vac Group Holdings Pty Ltd 2. Beacos Pty Ltd in its own capacity and as trustee of the Beacos Trust 3. Rebirthed Earth Pty Ltd 4. Soil Transfer Pty Ltd 5. Staking U Asia Pacific Campus Pty Ltd 6. Vac Group Employees Pty Ltd 7. Vac Group Operations Pty Ltd 8. Vac-U-Dig Pty Ltd 9. Vac-U-Digga Pty Ltd in its own capacity and as trustee of Vac-U-Digga Trust 10. Vac-U-Digga R & D Pty Ltd 11. VHS IP Pty Ltd 12. Earth Radar Group Pty Ltd 13. Earth Radar Pty Ltd 14. Cosbea Pty Ltd in its own capacity and as trustee of Cosbea Unit Trust D14-191118-VACGVAC03-First meeting presentation-MM 6

Meeting formalities Quorum: Insolvency Practice Rules 75-105  Attendance register  Voting (on the voices and using voting slips)  Time and place convenient: Insolvency Practice Rules 75-30  Proofs of debt and proxies  D14-191118-VACGVAC03-First meeting presentation-MM 7

Purpose of meetings First meeting of creditors Convened under Section 436E of the Corporations Act to:  determine whether to appoint a Committee of Inspection and, if so, who are to be the Committee members; and – consider the removal of the Administrators and appoint an alternative Administrator who has consented to act – These meetings have no authority to consider any other business  Second meeting of creditors To be convened on or around 19 December 2019  Creditors will vote on the future course of action for Vac Group  D14-191118-VACGVAC03-First meeting presentation-MM 8

Declaration of Independence, Relevant Relationships and Indemnities (DIRRI) and remuneration DIRRI DIRRI dated 21 November 2018 – a copy was distributed with the initial information to creditors  DIRRI is tabled and is available for inspection at this meeting  Our assessment identified no real or potential risks to our independence  Remuneration Schedule of rates provided with meeting information  Comprehensive remuneration report will be prepared prior to seeking approval of fees  D14-191118-VACGVAC03-First meeting presentation-MM 9

Role of the Voluntary Administrators Voluntary Administrators: Appointed by directors of Vac Group and represent the interests of all stakeholders  The directors’ powers are immediately suspended and the Voluntary Administrators are in control of the assets  The Administrators are responsible for the ongoing trading of the business  Our responsibilities include: Holding meetings of creditors;  Investigating the reasons for failure of the business;  Preparing a comprehensive report to creditors; and  Making recommendations to the creditors about the future of the companies.  D14-191118-VACGVAC03-First meeting presentation-MM 10

Voluntary Administration timeline Today’s meetings Appointment Within 8 business days Within 20 business days Within 25 business days 28 November 2019 19 December 2019 18 November 2019 12 December 2019 (approx.) 1 st meetings of creditors held Administrators take Written notice of second 2 nd meetings of creditors control of company and meetings mailed to creditors Purpose: ADMINISTRATION held its assets and employees (i) Consider the replacement of Options: the VA - DOCA (ii) Consider the appointment of a Committee of - Liquidation 21 November 2019 12 December 2019 Inspection - Return to directors Written notice of first Administrators Report meetings e-mailed or issued with mailed to creditors and recommendations employees D14-191118-VACGVAC03-First meeting presentation-MM 11

THE VAC GROUP

Background The Vac Group commenced in 2000  The services provided by Vac Group include excavation of materials using non-destructive vacuum hydro-excavation services,  associated waste recovery, transportation, treatment, disposal and/or recycling services. Vacuum excavation services include: Excavation of existing pits; – Excavation of new ground for pits; – Trenching and potholing for services; – Pump out of waste materials; and – Waste transport and disposal. – Vac Group has also developed a range of technologies to allow Vac Group to locate and map underground services, such as  water, telephone, fibre-optic and other services, utilising electro-magnetic induction and high resolution ground penetrating radar. Vac Group has a range of mobile plant and equipment in operation throughout Australia. This includes:  Truck-mounted vacuum excavation units; – Hook lift vacuum excavation unit and skip bin units; – Tipper trucks and trailers; – Various light vehicles; – Road profile (surveying units); and – Other specialised equipment – D14-191118-VACGVAC03-First meeting presentation-MM 13

Corporate structure Jaya Management Pty Ltd (6%) B Reeves Family Pty Ltd (35%) John Raymond Reeves (12%) NOT SUBJECT TO APPOINTMENT 53% New Zealand Operations Earth Radar 100% in all entities 47% Earth Radar Earth Radar Pty 100% VacTel NZ Beacos NZ Vac-U-Digga NZ Group Pty Ltd Ltd Limited Limited Limited VAC Group Neil Costello (33.33%) Vac-U-Dig Pty Holdings Pty Ltd Benjamin Costello (33.33%) Ltd Sofia Salvatore (33.33%) Related party Cosbea Unit Related party Cosbea Pty Ltd ` Trust 100% Australian Operations (referred to as Vac Ops) VAC Group Staking U Pacific VAC Group Vac-U-Digga Pty Soil Transfer Pty Vac-U-Digga Rebirthed Earth Beacos Pty Ltd Operations Pty Asia Campus Pty Employees Pty Ltd Ltd R&D Pty Ltd Pty Ltd (atf) Ltd Ltd Ltd (atf) Vac-U-Digga Beacos Trust VHS IP Pty Ltd Trust Source: Corporate structure provided by Management and ASIC company searches D14-191118-VACGVAC03-First meeting presentation-MM 14

Creditor claims Creditors are entitled to lodge claims with the Administrators for monies owed  Category Estimated number Estimated value ($’000) Employees 245 4,417 Secured & PPSR creditors 56 22,342 Unsecured creditors 276 4,248 Total 577 31,007 It is too early to form conclusive views on the potential return to unsecured creditors  The order in which different classes of creditors are paid is determined by the Corporations Act 2001  Generally, the order of priority is as follows:  Employees (priority from certain categories of assets) – Secured creditors – Unsecured creditors – D14-191118-VACGVAC03-First meeting presentation-MM 15

UPDATE OF VOLUNTARY ADMINISTRATION