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ALFRED ANGELO (AUSTRALIA) PTY LTD (ADMINISTRATORS APPOINTED)

A.G.N. 064 934 710

REPORT TO CREDITORS Report pursuant to Section 439A(4) of the Corporations Act 2001

Key Data

Administrators: Katherine Elizabeth Barnet Hugh Armenis

Date of Appointment: 4 August 2017

Meeting of Creditors: Date: 8 September 2017 Time: 11:00AM Venue: Level 3, 1 Castlereagh Street, Sydney NSW

Secured creditors: Nil to .003 cents in the $ Priority employees: 100 cents in the $ Unsecured creditors: Nil

Estimated Return:

Please complete and return the following attached forms:

Formal proof of debt form Proxy form

Key Contact: Adam Treffiletti T (02) 8078 2113 F (02) 9230 0066 E [email protected] Our Reference: AXT1 / C5 / 2087667

Date: 31 August 2017

Level 3 , 1 Castlereagh Street Sydney NSW 2000 bentleys.com.au

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TABLE OF CONTENTS

ABREVIATIONS/DEFINITIONS

ANNEXURE LISTING

1. Executive Summary

2. Introduction

3. History of the Group and Background Information .

4. Historical Financial Information

5. Administrators Investigations

6. Director's Report as to Affairs & Reason for Failure

7. Creditor Claims

8. Proposal for a of Deed of Company Arrangement,.

9. Estimated Outcome Statement

10. Alternatives Available to Creditors

11. Administrators' Remuneration

12. Meetings of Creditors

13. Further Information

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Alfred Angelo (Australia) Pty Ltd (Administrators Appointed) A.C.N. 064 934 710

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ABBREVIATIONS / DEFINITIONS

Administrators Katherine Elizabeth Barnet and Hugh Armenis

Corporations Act 2001

Australian Restructuring Insolvency & Turnaround Association

Australian Securities and Investments Commission

Charles Vowell, Stephen Czech and Richard Anders

Declaration of Independence, Relevant Relationships and

Indemnities

Deed of Company Arrangement

Deed of Company Arrangement proposal

Earnings before interest, tax, depreciation and amortisation

Estimated Outcome Statement

Financial year ending 30 June 2015

Financial reporting period 1 July 2015 to 30 June 2016

Financial reporting period 1 July 2016 to 30 June 2017

Alfred Angelo NewCo, Inc

Personal Property Security Register

Director's Report as to Affairs

Act

ARITA

ASIC

Directors

DiRRI

DOCA

DOCA Proposal

EBITDA

EOS

FY15

FY16

FY17

HeadCo

PPSR

RATA


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ANNEXURE LISTING

A Corporate Structure

B Declaration of Independence, Relevant Relationships and Indemnities

C Information Sheet

D Estimated Outcome Statement

E Remuneration Report

F Summarised Receipts & Payments

G Notice of Meeting

H Appointment of Proxy Form

I Formal Proof of Debt


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1.0 Executive Summary

1.1. Purpose of Report

We, Katherine Elizabeth Barnet and Hugh Armenis were appointed joint and several Voluntary Administrators ("the Administrators") of Alfred Angelo (Australia) ("the Company") on 4 August 2017. The purpose of this report is to provide:

> An overview of the Administrators investigations into the Company's business, property, affairs and financial circumstances; and

> The Administrators opinion on the options available to creditors in deciding the future the Company.

1.2. Background of the Alfred Angelo Group

The Company is the Australian subsidiary of an international wholesaler of wedding gowns and bridesmaid dresses.

On 14 July 2017, the US based holding company, Alfred Angelo NewCo, Inc ("HeadCo") and other related entities in the Alfred Angelo Group ("the Group") filed for Chapter 7 in the United States (refer to www.alfredangelo. com/case-documents for further information in relation to the US entities). On that date all companies in the group including the Australian subsidiary ceased operating. The Australian subsidiary was unable to continue to operate without the ongoing support of the HeadCo.

1.3. Dividend Prospects

If it is resolved by creditors that the Company is to be placed in liquidation, we currently estimate a return to creditors as follows:

Estimated Cents / $ return Estimated Timeframe

Low High

Estimated Return by Class of Creditor

Secured Creditor

Priority Employee Creditors

Ordinary Unsecured Creditors

Nil 0.003 12 months

100 100 6 months

Nil Nil n/a

The range of estimated returns is a result of the uncertainty regarding the recoverability and value of the Company's inventory and outstanding trade debtors, which could be minimal or substantial. We will endeavour to provide creditors with updated estimates of returns and timeframes progressively and as soon as further information comes to hand.

Our investigations to date have not identified actions available to liquidators (if appointed) regarding voidable transactions, insolvent trading and other claims.

A more detailed analysis of the estimated dividend is contained in the Estimated Outcome Statement contained in Annexure D.


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1.4. Meeting of Creditors

The second meeting of creditors wiii be held as follows:

Time: Date Venue:

11:00am 8 September 2017 Bentleys Corporate Recovery Level 3, 1 Castlereagh Street, Sydney, New South Wales

The Administrators recommend that the creditors should resolve to place the company into Liquidation at the forthcoming meeting. A formal notice of meeting for the Company is attached to this report. If you have already submitted a formal or an informal proof of debt, you do not need to submit a further claim for the meeting.

2. Introduction

2.1. Appointment of Voluntary Administrators

Katherine Barnet and Hugh Armenis were appointed Administrators of the Company by resolution of the directors ("the Directors") of the Company in accordance with section 436A of the Act on Saturday 4 August 2017.

2.2. Purpose and Overview of Voluntary Administration Process

The role of the administrators is to assume control of the Company and to generally represent the interest of all creditors. This is reflected in the objective of the voluntary administration process which is to allow for the business, property and affairs of an insolvent (or likely to become insolvent) company to be administered in a way that either:

a) maximises the chances of the company, or as much as possible of its business, to continue in existence; or

b) if it is not possible for the company or its business to continue in existence, results in a better return for the company's creditors and members than what would result from an immediate winding up.

One of the important consequences of the administration process is that substantially all claims against the company are subject to a statutory moratorium (except secured claims in certain circumstances). Absent consent of the administrators or leave of the Court, legal proceedings, winding up proceedings and execution against company property cannot be commenced and any which are already on foot are stayed during the administration period. Further, while a company is in administration, owners and lessors of property that are being used by the company (for example leasehold premises) cannot take possession without the consent of the administrators or leave of the Court.

This report has been prepared in accordance with section 439A of the Act and in accordance with the Australian Restructuring Insolvency & Turnaround Association's ("ARITA") Code of Professional Practice for Insolvency Practitioners and informs creditors about the conduct of the administrations and the Administrators preliminary Investigations into the Company's affairs. The


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report also provides information about the available alternatives for the future of the companies in the Group and the Administrators' recommendations.

This report has been prepared based on information from the following sources:

> The books and records of the Company (including electronic records);

> Australian Securities & Investment Commission ("ASIC") searches;

> Personal Property Securities Register ("PPSR") searches;

> Information, reports and discussions with the Directors and key employees;

> Information provided by creditors; and

> Other publicly available information.

The purpose of this report is to provide creditors with sufficient information to make an informed decision about the future of the Company.

a) Purpose of the Report and Summary

b) Background information about the Company.

c) The results of our preliminary investigations regarding Offences, Voidable Transactions and Insolvent Trading

d) Estimated return from a winding up;

e) Effect on employees;

f) Proposal for a deed of Company Arrangement;

g) The options available to creditors when deciding on the future of the Company;

h) The Administrators' opinion on each of these options, including which option we believe to be in the best interests of creditors;

i) Any other Material Information; and

j) Details of any Incomplete or additional information.

Corporations Regulation 5.3A.02 requires an administrator to specify whether there are any transactions that appear to be voidable transactions in respect of money, property or other benefits which may be recoverable by a liquidator under Part 5.7B of the Act.

In order to assist creditors, employees and shareholders understand the VA process the Australian Securities & Investment Commission ("ASIC") has released a package of insolvency information sheets, which have been endorsed by the Australian Restructuring Insolvency & Turnaround Association ("ARITA"). You may download the ASIC publication titled "Insolvency Information for Directors, Employees, Creditors and Shareholders" from ARITA or ASIC websites. This provides an index of the information sheets available. Creditors may also visit the following websites for additional information about corporate insolvency:

> www.arita.com.au

> www.asic,gov.au


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2.3. Declaration of Independence, Relevant Relationships and Indemnities

A Declaration of Independence, Relevant Relationships and Indemnities ("DIRRI") was enclosed with our first circular to creditors in accordance with Section 436DA of the Act and ARITA's Code of Professional Practice.

The DIRRI outlines information in relation to the Administrators' independence, prior personal or professional relationships with the Company (if any) and the Administrators' assessment of the risks to his or her independence prior to accepting an appointment.

We confirm no change to the information disclosed in the DIRRI. A copy of the DIRRI is attached at (Annexure B).

3. Background Information

3.1. Overview of the Alfred Angelo Group

The Alfred Angelo Group of companies had subsidiaries that operated wholesale and retail operations in numerous foreign jurisdictions including, Peru, Mexico, Canada, United Kingdom, China and Australia. The ultimate holding company, Alfred Angelo Newco Holdings LLC ("Headco") was based in the United States. The Alfred Angelo brand has been supplying bridal fashion Internationally since 1933.

The Australian subsidiary, Alfred Angelo (Australia) Pty Ltd was incorporated on 3 September 2004. It supplied wholesale wedding dresses to over 75 retail stores Australia wide. The Company operated from leased premises in Caringbah, NSW and employed 4 staff. Headco provided strategic direction, inventory management, distribution, staffing and financial management to the Australian subsidiary.

On 14 July 2017, after being unable to obtain an investor to secure the financial stability of the Group, HeadCo and the numerous entities in the Group filed for Chapter 7 under the United States Bankruptcy Code. As a result, all companies in the Group ceased trading and closed their wholesale and retail operations. Following the Chapter 7 filing in the United States, the Company's Directors resolved to place the Company into Voluntary Administration.

FSJC V, LLC ("FSJC"), being an affiliate of private equity firm Czech Asset Management, is a secured creditor over the assets of the Group. FSJC has a charge over the whole or substantially the whole of the Company's property. FSJC is owed USD$61,715,992.

3.2. Group Corporate Structure

An extract of the Corporate Group Structure, summarising the Company's ownership structure is provided below:


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Alfred Angelo New Co Holding, LLC

1 Alfred Angelo Newco, Inc.

1 Alfred Angelo (Australia) Pty Ltd

Enclosed at Annexure A is a complete Group corporate structure.

3.3. Statutory Information

Set out below is a summary of the key statutory information for the Company from the ASIC database as at the date of the Administrators' appointment:

Company statutory information

Company name:

ACN:

ABN:

Registration date:

State of incorporation:

Registered office:

Directors:

Alfred Angelo (Australia) Pty Ltd

110816861

45 110 816 861

3 September 2004

New South Wales

Level 29, 66 Goulburn Street, Sydney NSW 2000

Charles Vowell Appointment Date: 25 September 2009

Richard Michael Anders Appointment Date: 5 July 2014

Stephen James Czech Appointment Date: 5 July 2014

Issued shares: 10

Shareholder: Alfred Angelo Inc (Ultimate Holding Company)

FSJC V, LLC Capital Finance Australia Ltd

Registered security interests


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3.4. Registered Security Interests

On our appointment, we conducted a search of the PPSR (register of secured creditors) which identified two registered security interests over property of the Company, as set out below:

PMSI Collateral Class Corporate Entity Reg. No Reg Date

FSJC V, LLC No All PAAP No Exception 201112260052742 30/1/2012

Capital Finance Australia Ltd Yes Other Goods 201607010002116 1/7/2016

Further discussion in relation to the above entities is provided at Section 7.1 of this report.

4. Historical Financial Information

4.1. Historical Statement of Financial Performance

Summarised below are the Company's Statement of Financial Performance for FY16 and the period 1 July 2016 to 14 July 2017 ("FY17"):

Statement of I inancial Performance ($USD)

FY17 FY16

Income

Cost of sales

Gross Profit

1,225,993

709,722

516,271

299,363

1,504,926

904,691

600,235

424,395 Expenses

Net profit / (loss) 216,908 175,840 Source: Company management accounts for FY16 and FY17, maintained by HeadCo.

The Company's financial statements reported net profits for both FY16 and FY17, with an increase in net profit of $41,068 in FY17. The Company's gross profit margin increased of 1.9% from FY16 to FY17 (from 38.6% to 40.5% respectively).

The financial statements are consistent with our analysis below (section 5.2) that the Company's insolvency was not driven by deterioration in its trading but was contingent on the overall financial position of the Group.

4.2 Historical Statement of Financial Position (Balance Sheet)

Summarised below are the Company's Statement of Financial Position (or Balance sheet) as at 30 June 2016, 31 December 2016 and 14 July 2017:


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Statement of Financial Position ($USD)

14 July 17 ($) 31 Dec 16 ($) 30 June 16 ($)

ASSETS

Current Assets

Non-Current Assets

119,329

16,569

(79,180)

16,383

30,113

16,382

TOTAL ASSETS

LIABILITIES

135,898 (62,797) 46,495

Current liabilities

Non-current liabilities

119,062

5,390

100,438 252,770

TOTAL LIABILITIES 124,452 100,438 252,770

NET ASSETS / (LIABILITIES) 11,446 (163,235) (206,275)

EQUITY 11,446 (163,235) (206,275) Source: Company management accounts for FY16 and FY17, maintained by HeadCo.

The Company included in its "Current Assets" an intercompany loan liability owed to HeadCo. As at 30 June 2016, 31 December 2016 and 14 July 2017 the intercompany loan fluctuated between $1.3 and $1.4 million.

HeadCo did not charge the Company any interest on the outstanding intercompany loan balance and although payments were made by the Company in respect of the intercompany loan. We are not aware of any effort of HeadCo to enforce recovery of the loan.

If the intercompany loan is removed from "Current Assets" then the Company's liquidity ratio is in excess of 1, indicating the Company's ability to pay its short term obligations from cash and other assets readily converted to cash.

As at 14 July 2017, the Company's material asset balance was its "Trade Receivables" of $691,220 which is net of a provision for doubtful debts of $289,598. However, based on our analysis of Trade Receivables (Section 6.3.2 below) this provision is likely to not fully reflect the recoverability of the trade debtors and will be subject to further investigations.

The Company's inventory balance as at 14 July 2017 was $37,820. This amount did not include the value of the sample dresses the Administrators collected from the Company's premises. We have been informed that the Company did not complete a stock take of the sample dresses on site. Further discussion in relation to the sample dresses collected is at Section 6.3.3.

Overall, our analysis is that the Company's viability was contingent on the support it was receiving from HeadCo and whether the intercompany loan was due and payable.


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5. Administrators Investigations

5.1 Overview

An administrator is required to conduct an investigation into the business, property, affairs and financial circumstances of a company under administration. The purpose of these investigations is to inform creditors of the potential recovery actions available to a liquidator should creditors resolve to wind up a company. Creditors should note that an administrator (including a deed administrator) does not have the power under the Act to pursue voidable transactions or commence proceedings for insolvent trading. Only a liquidator has those powers.

5.2 The Company's Solvency

A company is considered solvent, if and only if it can pay all of its debts, as and when they fall due and payable. A company that is not solvent is considered insolvent.

Determining whether a company is insolvent (and the date at which it became insolvent) is often difficult and ultimately maybe a matter for the courts to decide.

Our preliminary view is that the solvency of the Company was contingent on the continued financial support it received willingly from HeadCo and FSJC. HeadCo financed this support with FSJC, being secured by the whole or substantially the whole of the Group's assets. Our view is that the Company only became insolvent at such time that HeadCo was unable to meet its obligations under a security agreement with FSJC, whereby it filed for Chapter 7 under the United States Bankruptcy Code on 14 July 2017. Notwithstanding, we have undertaken an assessment of various indicia of Insolvency, as set out below:

Indicators of Insolvency Comments Continuing Trading Losses No evidence identified. As disclosed in Section 4.3 of

this report, the Company recorded profits for both FY16 and FY17.

Cash flow difficulties. No evidence identified. The Company was supported by an intercompany loan from HeadCo. The Company's records indicate consistent high levels of Trade Receivables. Prior to our appointment, the Company was making an active effort to recover outstanding customer balances. As at 14 July 2017, Trade Receivables were $691,220, being at its lowest since at least 30 June 2015.

Difficulties selling its inventory, or collecting debts owed to it.

Creditors not being paid on agreed trading terms No evidence Identified. The Company's records indicate that the Company consistently maintained creditors at manageable levels and within agreed trading terms. No evidence identified. The Company's records indicate the Company had $89,984 in accrued payroll tax, workers compensation, federal Income tax, foreign Income tax, GST and VAT as at July 2017.

Overdue Commonwealth and state taxes

Legal action Is threatened or commenced against the company, or judgements are entered against the company, In relation to outstanding debts.

No evidence Identified.

Strained relationship with major funder Including inability to raise further/alternative finance

The Company was supported by an intercompany loan from HeadCo and FSJC. It was placed into Administration shortly after support withdrawn. No evidence identified. The Company's financial Inability to produce timely and accurate financial


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information that shows the company's trading performance and financial position, and make reliable forecasts.

information was prepared on a consolidated group basis by HeadCo.

Company directors have resigned, citing concerns about the financial position of the company or its ability to produce accurate financial information on the company's affairs.

No evidence identified.

Special arrangements with selected creditors No evidence identified. Defaults with financiers The Group was funded by FSJC who appeared willing to

provide funding up until the period HeadCo and other related entities filed for Chapter 7 in the United States Bankruptcy Code. No evidence identified. The company's financier has appointed an

investigative accountant to advise the financier about its funding exposure to the company. Employees, or the company's bookkeeper, accountant or financial controller concerned about

No evidence identified.

the company's ability to meet its financial obligations It is not certain that there are assets that can be No evidence identified. sold in a relatively short period of time to provide funds to help meet debts owed, without affecting the company's ongoing ability to continue to trade profitably.

5.3 Voidable Transactions

Enclosed at Annexure C is an Information Sheet issued by the ARITA, which summarises the following transactions that may be recovered by a liquidator:

> A payment made to a creditor or transaction to which the creditor is a party, in the six-month period prior to the appointment of an Administrator, or four years if a related creditor, which results in the creditor receiving more than they would if they had proved in the winding up, and is an insolvent transaction of the Company (unfair preference);

> A payment made to a non-related creditor during the two years prior to the appointment of an Administrator, or four years if a related creditor, which is an insolvent and uncommercial transaction;

> A payment made to a creditor in the ten years prior to the appointment of an Administrator which is fraudulent;

> An unfair loan whenever made;

> An unreasonable director related transaction;

> Arrangements to avoid employee entitlements; and

> Ascertain circulating security interests created within the six months prior to our appointment.

Of the above transaction classes which may be recovered by a liquidator, the first three classes of payment require that a company be insolvent at the time that payment was made or becomes insolvent by reason of the payment. As set out in Section 10.2 above, our preliminary view is that the Company may have not have been insolvent until such time that HeadCo filed for Chapter 7 in the United States Bankruptcy Code on 14 July 2017 and accordingly the Company (and the


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Group generally) defaulted under the charge granted to FSJC, which was secured by all assets of the Group.

Our investigations have included:

> Reviewing the Company's financial information; and

> Liaising with the Group's Vice President of Finance to identify any creditors that had entered into a payment arrangement with the Company or required regular payments to ensure continuity of service;

Based on our investigations to date we have not identified any potential Voidable Transactions. However, if considered commercial further investigations may be conducted once a liquidator is appointed.

5.4 Insolvent Trading

Creditors may be aware of the general concept that a director may be held personally liable for debts incurred while a company was trading whilst insolvent and when the director knew, or ought to have known, of such insolvency.

Having established the likely date a company became insolvent, a liquidator can investigate whether the director incurred debts at a time when he/she suspected, or should have suspected, the company was insolvent (insolvent trading). There is a specific requirement under the Act that directors must take action to avoid insolvent trading. If it is proven that there were any breaches of the Act by the director for insolvent trading, then the director may be held personally liable for any debts incurred whilst the Company traded whilst insolvent.

Pursuant to Sections 588G and 588M of the Act, a liquidator may seek to recover from the director/s of a company any debt incurred by the company after a time that a reasonable person would suspect that the company became insolvent.

Insolvent trading is governed by Section 588G(1) of the Act and applies if:

a) a person is a director at the time the debt is incurred;

b) the company is insolvent at that time; and

c) at that time, there are reasonable grounds for suspecting that the company is insolvent.

This Section is breached if:

a) the person is aware at that time that there are grounds for suspecting insolvency; or

b) a reasonable person in a like position in a company, in the company's circumstances, would be aware of suspecting insolvency.

As outlined, for there to be a breach of these provisions, the company had to be insolvent at the time the debt was incurred. It should be noted that cash flow shortages or problems or short term liquidity problems are not necessarily evidence of insolvency.

As mentioned in Section 5.2, the Company was provided continued financial from HeadCo and FSJC (through Headco), being secured by the whole or substantially the whole of the Group's assets. HeadCo did not charge the Company any interest on any financial support provided to


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the Company. Accordingly, it is our preliminary view is that the Company only became insolvent at such time that HeadCo was unable to meet its obligations under a security agreement with FSJC, whereby it filed for Chapter 7 under the United States Bankruptcy Code on 14 July 2017.

Creditors should be aware that it can be difficult for a Liquidator to pursue current and former directors for insolvent trading in the event of Liquidation as directors have several defences available to them, including:

a) if it is proved that, at the time the debt was incurred, the person had reasonable grounds to expect, and did expect, that the company was solvent at that time and would remain solvent:

b) if the person relied on another person to provide the financial information so that if the information was relied upon, the person expected that the company was solvent and would remain so;

c) the person was ill and did not take part in the management of the company; and

d) the person took all reasonable steps to prevent the Company from incurring the debt.

Another consideration prior to bringing proceedings of this nature, and in the absence of an insurance policy, a liquidator needs to assess the personal financial capacity of the director (or former director) to meet any judgment or order against them.

Searches of publically available information do not reveal any real property interests owned by the directors. Based on this information, we are of the view that the Directors may have not have the financial resources to meet any monetary judgment against them, should one arise.

Under section 588V of the Act, a holding company can be held liable for the insolvent trading of a subsidiary. In this case, we are unlikely to take steps to pursue the holding company as HeadCo has already filed for Chapter 7 in the United States.

A liquidator (if appointed) will be able to investigate a potential insolvent trading claim in greater detail if it is considered commercial to do so. Should it be determined there is a potential claim against the Directors the position would be calculated with reference to the incurring of debts between the date of insolvency and our appointment.

5.5 Offences

In accordance with Section 180 to 183 of the Act, directors and officers are generally required to:

> Exercise their powers and discharge their duties with a degree of care and diligence of a reasonable person in their position;

> Exercise their powers and discharge their duties in good faith and in the best interests of the Company and for a proper purpose; and

> Not improperly use their position and information about the Company to gain an advantage for themselves or others or cause detriment to the Company.

Should a liquidator be appointed, further investigations would be undertaken to determine the extent to which, if at all, there are breaches of these provisions of the Act. We note that the Australian domiciled director did not have any access to financial information.


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5.6 Conclusion

If creditors resolve that the Company be wound up, the Administrators will become the liquidators of the Company. The liquidators may conduct further investigations into the Company's affairs,

Liquidators are also required to submit a report to ASIC any offences or breaches of the Corporations Act identified.

Creditors should note that an administrator's Investigation Is not as detailed as an investigation conducted by a liquidator. A liquidator Is empowered to conduct further investigations and commence proceedings.

6. Directors' Report as to Affairs and Reasons for Failure

Directors' Reasons for Failure 6.1

The Directors have attributed the failure of the Company the business model of the Group, being "special order" dresses, which had become outdated as customers were purchasing product "off the rack". HeadCo was also unable to maintain its obligations to FSJC and consequently was forced to file for Chapter 7 in the United States.

We consider that the loss of ongoing financial and management support from the US based Headco was a major contributor to the failure of the company.

We have not identified any reasonable basis to disagree with the Directors' reasons for failure.

Director's Statement - Report as to Affairs 6.2

Pursuant to Section 438B of the Act, the Directors are required to submit to the Administrators a statement about the business, property, affairs and financial circumstances of the Company as at the date of the appointment of Administrators ("Director's Statement").

One of the Company's Directors, Mr Charles Vowell has provided us with a Director's Statement which is reproduced below alongside the Administrators' opinion:

(THIS PAGE HAS BEEN LEFT INTENTIONALLY BLANK)


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Director's opinion Administrators' opinion

Assets

Cash at Bank

Debtors

Property & Equipment

Inventory

Total assets

185,888

18,676

6.3.1 185,000 185,000 185,888

302,014 6.3.2 Unknown Unknown

Unknown Unknown 0 6.3.3 0

Unknown Unknown 0 6.3.3 unknown

185,000 185,000 204,564 487,902

Liabilities (78,343,577) (78,343,577)

(78,477) (78,477)

(36,320) (36,320)

Secured creditors Unknown Unknown 7.1

Unknown Priority creditors

Unsecured creditors

7.2 Unknown

Unknown Unknown 7.3

Unknown Unknown 78,458,373 78,458,373 Total liabilities

(78,253,809) (77,970,471) Estimated / (deficiency) 185,000 185,000 Source: Report as to Affairs prepared by Charles Vowel, dated 15 August 2011.

It is difficult to provide any substantive comments in relation to the RATA information provided by the Directors due to the lack of information provided. Our findings in relation to the Company's assets and liabilities as a result of our own enquiries are provided in the proceeding sections.

6.3 Assets

6.3.1 Cash at Bank

The Company held a business account and term deposit facilities with the ANZ bank ('the Bank'). As at the date of appointment, the facilities had credit balances as follows:

180,037

3,592

2,259

185,888

Business Banking Facility

Term deposit

Term deposit

Total

We requested the above accounts be frozen for debit transactions and the available credit balances be transferred to the Administrators' account. To date we have received $182,359. The accounts continue to remain open to ensure the receipt of payments from the Company's trade debtors (see below for further detail in this regard).


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6.3.2 Trade Debtors

The Company's customer base consisted primarily of retail stores which sold the Alfred Angelo bridal line to end consumers. Customers placed orders for dresses with the Company, whereby the dresses were then manufactured in China and distributed directly to the retail stores.

Our review of the Company's trade debtor records indicate that the Company had outstanding trade debtors totalling $827,560 from 78 customers as at the date of our appointment. We have issued a letter of demand to all trade debtors requesting payment of outstanding balances in addition to engaging the Company's former staff to assist with the recovery process. To date we have collected $12,342 of this amount.

Approximately $492,197 of the outstanding trade debtor balances were aged over 91 days as at 14 July 2017. Whilst, we have been informed by the Company's former employees and HeadCo's Vice President of Finance that the all trade debts should be recoverable, we have taken the preliminary view that these accounts have a limited chance of recovery.

Our further enquiries have revealed that as a result of the Group's sudden collapse on 14 July 2017, a number of customers were left with unfilled orders, forcing them to issue refunds to end consumers and suffer brand damage as a result. To date, debts totalling $33,349 have been disputed. We are attempting to quantify the value of unfilled orders in order to determine overall recoverability of trade debtors.

Our preliminary analysis of the recoverability of the Company's trade debts is provided below. Based on our enquiries to date we have categorised debts as having either a high chance of recoverability based on agreed payment plans (Category 'A'), a medium chance of recoverability due to further investigation being required (Category 'B'), or a low chance of recoverability due to either being disputed or aged over 91 days.

Estimated Trade Debt Recoverability

Medium $ High $ Low $

Debts recovered to date

Category 'A' debts

Category 'B' debts

Category 'C debts

Total

12,342

6,334

283,338

525,546

525,546 18,676 283,338

6.3.3 Property & Equipment. Inventory

Upon our appointment, we attended the Company's trading premises to conduct a stocktake and collect the Company's inventory, which consisted predominately of sample bridal dresses ("the Inventory") which were used for display at bridal showings and for loan to the Company's retail customer base. $37,820 in its financial statements only reflected the value of finished dresses in transit to end customers and not the value of the sample dresses.

Creditors should be aware that the Company's inventory balance of


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We are undertaking an assessment of the most efficient and cost effective method for realisation of the Inventory after consultation with our agents and the former employees. Our options to realise the Inventory are as follows:

Engage an agent to realise through an auction process; >

Sale of the inventory directly to the Company's retail customer base with the assistance of former Company staff; and

>

Sale of the inventory directly to end consumers by listing the dresses for sale on various websites.

>

While it is difficult to estimate the recoverable value of the sample dresses, it is our opinion that sales directly to the Company's retail customer base with the assistance of former Company staff may provide a greater return to creditors in the first instance.

The Company also owned a quantity of sundry office equipment present at its trading premises. We have concluded that engaging an agent to collect and realise these items through an auction process would not result in a commercial outcome for creditors.

7. Creditor Claims

7.1 Secured Creditors

As provided section 3.4 of this report, we identified the following registered security interests over property of the Company:

Corporate Entity PMSI Collateral Class Reg. No Reg Date

FSJC V, LLC No All PAAP No Exception 201112260052742 30/1/2012 Capital Finance Australia Ltd Yes Other Goods 201607010002116 1/7/2016

7.1.1 FSJC V, LLC

FSJC, being an affiliate of private equity firm Czech Asset Management (who acted as the administrative agent of FSJC), holds a security interest which grants it a charge over the whole or substantially the whole of the Company's property.

Pursuant to a Deed of Charge dated 22 April 2011, HeadCo, the Company and various other entities within the Group entered into a loan and security agreement with FSJC for an initial secured amount of US$2,500,000 up to a maximum of US$78,400,000. At the date of our appointment, the balance outstanding to FSJC totalled US$61,715,992.

To the extent the assets of the Group subject to FSJC's security interest are insufficient to pay the debts owed by the Group, such that FSJC suffer a shortfall in what is owed to them by the Group, then FSJC will be able to prove as an unsecured creditor in a liquidation for the shortfall.

Employee claims for outstanding entitlements will receive a priority from circulating asset realisations (e.g cash at bank, trade debtors and inventory) above secured creditors.

Alfred Angelo (Australia) Pty Ltd {Administrators Appointed) A.C.N. 064 934 710

20

7.1.2 Capital Finance Austraiia Ltd ("CFA")

CFA leased telephone equipment to the Company and secured the equipment by registered a purchase money security interest ("PMSI") on the PPSR. A PMSI gives a creditor a "super priority" over other secured creditors.

At the date of our appointment the balance of the lease outstanding was $8,121.19. We subsequently notified CFA that we did not take possession of the equipment or intend to exercise any rights to the equipment under the lease.

To the extent that CPA's security interest is not sufficient to satisfy the outstanding debt owed they will be able to prove as an unsecured creditor in a liquidation for the shortfall.

7.2 Priority Creditors (Employees)

Under section 556 of the Act, non-related employee's entitlements are afforded a priority over other unsecured claims. 14 July 2017.

The Company employed 4 staff which were terminated on

Based on our preliminary review of the Company's payroll records, we provide a summary of the estimated amounts owed to employees below:

Estimate of employee entitlements

Category Claim ($) Wages Superannuation Annual leave Long Service Leave Payment in lieu of notice Redundancy Total

0 0

18,888 13,644 13,208 32,716 78,456

Source: Company payroll records, managed by ADP.

The Administrators will further verify employee claims for outstanding entitlements should the Company be placed into liquidation.

On the basis that the company is placed into liquidation, any employees that are owed entitlements (and are made redundant) can make a claim through the through the Department of Employment's Fair Entitlements Guarantee Scheme (should sufficient funds not be available in the liquidation).

FEG pays entitlements covering:

> Unpaid wages up to a maximum of 13 weeks;

> Annual leave;

> Long service leave;

> Payment in lieu of notice up to a maximum of 5 weeks; and

> Redundancy pay up to a maximum of 4 weeks per full year of service.


21

The scheme does not cover outstanding superannuation.

Under section 560 of the Act, any funds paid by the Department of Employment to the employees for outstanding entitlements will have the same right of priority as the employees would have in the winding up of the company.

If the Company is placed into liquidation, the liquidators will work with employees that have been made redundant to ensure that all claims for outstanding entitlements are submitted and processed through the Fair Entitlements Guarantee Scheme.

7.3 Unsecured Creditors

To date we have received informal and formal proof of debts from 1 unsecured creditor with claims totalling $825. Our estimate of total unsecured creditor claims based on our investigations to date is provided below:

Unsecured Cfeditor claims Creditor Notes Amount Claimed ($) Australian Taxation Office ("ATO") Intercompany loan account - HeadCo Trade Creditors Estimated unsecured creditor claims

1 19,076 1,312,879

36,320 2 3

1,371,033

Contingent Unsecured Creditor claims Landlord damages claims Less: Estimated bank guarantees held by landlords

Estimated Contingent Unsecured Creditor Claims

4 78,936 (10,296) 68,640

Total Estimated Unsecured Creditor Claims 1.439.673 Source: Proofs of debt received from Creditors, ATO portal, management accounts, outstanding Iwoiees sighted

Notes

1. Based on a review of the ATO's running balance account, the ATO has a debt in respect of outstanding business activity statements in the amount of $19,076. We are aware that the Company has not lodged income tax returns since FY14. The ATO has not lodged a Proof of Debt.

2. Please refer to Section 7.3.1 for details regarding this debt.

Based on the Company's records and Proofs of Debt received to date, projected trade creditor debts as at the date of this report total $36,320.

3.

4. The potential unsecured debt to the landlords has been calculated based on the outstanding rent owed under the remaining years of the tenancy agreement for the Company's leased premises, as summarised below:


22

10/29 Wurrook Circuit, Caringbah NSW 2229 Robrel Pty Ltd 23 June 2016 19 June 2019 $41,184 (inci. GST) annual $3,432 (incl. GST) p/month $3,432 (inci. GST) p/month $10,296 $78,936 Approximately 23 months remaining

We note that the landlord has a positive obligation to mitigate any losses and the quantum of the above claim may be less.

We have been unable to confirm if the landlord is currently holding the bank guarantee.

7.3.1 Intercompany Loan

The Company's financial records indicate an outstanding intercompany loan balance to HeadCo of US$1,312,878 as at the date of our appointment. This represented a slight decrease from the FY16 balance of US$1,369,296. Based on our investigations to date, the Company had been provided with continued financial support from HeadCo.

Our enquiries indicate that the intercompany loan was used to provide the initial funding to establish the Company's day to day operations in addition to recording the transfer of inventory. HeadCo purchased and paid for all inventory which was manufactured and distributed from China. When inventory was shipped to Australia, the standard cost of the inventory was transferred to the Company. The funds generated from the sale of inventory were used to pay trade creditors, while surplus funds were used to pay down the intercompany loan balance. The Group's Vice President of Finance has informed us that she was still in the process of properly reconciling the intercompany loan account transactions at the time of the Group's closure.

At the end of each year, a management and sourcing fee, along with a royalty fee was charged from HeadCo to the Company to cover its portion of design and sourcing costs, and for the management of the Company's operations.

A summary of the intercompany loan account from 30 June 2015 to 30 June 2017 is provided below: Summary of Intercompany Loan Account movement ($USD)

Opening Balance

Net Movement

Unknown 825,747cr

543,550cr

1,369,297cr

1,369,297cr

56,418dr

1,312,879cr

Unknown

Closing Balance 825,747cr Source: Company management accounts, maintained by HeadCo


23

8. Proposed Deeds of Company Arrangements (DOCA)

8.1 What is a DOCA?

A DOCA is a statutory instrument between the company and its creditors, which is binding on all unsecured creditors if the majority of creditors (In value and number) vote In favour that It be accepted at the second meeting of creditors.

DOCAs are typically put forward by parties associated with the company, such as Its management or its directors. A DOCA can take any form but they usually require that creditors receive less than payment In full of all monies due to them, or that their debts be paid over an extended period of time.

If a DOCA Is put forward and Is capable of acceptance, a company's administrators will express their opinion to creditors on whether they support it in their report to creditors. Creditors can then vote at the second meeting of creditors as to whether they support it, or whether the company should be placed into Liquidation or returned to the control of the company's directors.

No Deed proposal has been received. Accordingly, we do not recommend that creditors resolve for the Company to enter Into a Deed of Company Arrangement.

9. Estimated Outcome Statement

As set out In the enclosed estimated outcome statement ("EOS") at Annexure D, we estimate the return to creditors as follows:

Estimated Return by Class of Creditor Estimated Cents / $ return Estimated Timeframe

Low High

Secured Creditor

Priority Employee Creditors

Ordinary Unsecured Creditors

Nil 0.003 12 months

100 100 6 months

Nil Nil n/a

The EOS includes all potential recoveries and creditor claims.

10. Alternatives Available to Creditors

At the meeting of creditors to be held on 8 September 2017, creditors will be asked to resolve the future of the Company. Section 439C of the Act provides creditors with the following options:

a) That a company execute a DOCA;

b) That the Administration should end; or

c) That a company should be wound up.

It Is also within the rights of creditors at the meetings to resolve to adjourn the meetings for a period up to 45 business days.


24

The above options are mutually exclusive. Only one of the options may be resolved at the forthcoming meetings of creditors.

Our opinion on the each of the options available to creditors is outlined below.

10.1 That the Company execute a Deed of Company Arrangement

No DOCA proposal has been received. We do not recommend that creditors resolve for the Company to execute a DOCA.

10.2 The Administration should end and the Company be returned to the directors control

Creditors are able to resolve that the administration should end. Such resolution would result in the Company being released from Voluntarily Administration and control of the company reverting back to the Directors. Creditors would then be free to pursue any debt recovery actions.

The Group filed for Chapter 7 in the United States and as a result, all companies in the Group have ceased trading and closed their wholesale and retail operations. Accordingly, we do not recommend that creditors resolve to end the administrations.

10.3 The Company should be wound up in Liquidation

We recommend that the Company be wound up. The reasons for our recommendation are:

> No DOCA has been proposed;

> As a result of the Group filing for Chapter 7 in the United States, it has no access to any financial records, information or services previously provided by HeadCo;

> Liquidation may provide a potential return to priority creditors; and

> Liquidators will be able to proceed with further investigations into the affairs of the Company.

A Liquidator is empowered to conduct further investigations and commence proceedings where rights exist and the action is in the interests of creditors.

11. Administrators' Remuneration

Enclosed (Annexure E) is our remuneration report prepared in accordance with Section 449E of the Act and the ARITA Code of Professional Practice.

Creditors should refer to this report for detailed information on the remuneration sought by the Administrators or liquidators, if appointed.

We have not previously had any amount approved in respect of our remuneration. Accordingly, to date we have not drawn any amount for our remuneration in this Administration. Prior to commencing our appointment as Administrators, we agreed with the Directors and FSJC to a 10% discount on our time costs incurred in the administration.


25

At the forthcoming meeting of the creditors of the Company, we intend to seek approval of the following resolutions (being calculated at a 10% discount) at the upcoming meeting of creditors scheduled for 8 September 2017 at 11:00am:

Resolution 1 - Current Administrators' Remuneration:

"That the remuneration of the Administrators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 4 August 2017 to 24 August 2017 inclusive in the fixed amount of $45,643.50 excl. GST ($50,207.85 inci. GST) plus disbursements and that the Administrators be authorised to draw fees up to this amount at their discretion."

Resolution 2 - Future Administrators' Remuneration:

"That the remuneration of the Administrators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 25 August 2017 to 8 September 2017 inclusive in the fixed amount of $13,500 excl. GST ($14,850 inci. GST) plus disbursements and that the Administrators be authorised to draw fees up to this amount at their discretion."

Resolution 4 - Future Liquidators' Remuneration (if appointed)

"That the remuneration of the Liquidators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 9 September 2017 onwards in the interim amount of $36,000.00 excl. GST ($39,600.00 inci. GST) and disbursements and that the Liquidators be authorised to raw such fees from time to time as they are accrued up to this amount. If this limit is exhausted, the Liquidators will seek further fee approval from a committee of inspection, if any, creditors, or the court."

We also enclose a copy of our receipts & payments for the period 4 August 2017 to 31 August 2017 at Annexure F.

12. Meetings of Creditors

Enclosed (Annexure G) is our formal Notice of Meeting.

We note that the second meetings of creditors has been convened for 8 September 2017 at 11:00am, at the office of Bentleys Corporate Recovery Pty Ltd, Level 3, 1 Castlereagh Street, Sydney NSW 2000 to discuss this report, our recommendations and to obtain a resolution from creditors on the future direction of the Company.

Enclosed with this report are:

Form 535 - Formal Proof of Debt or Claim (Annexure I)

Regulation 5.6.23 of the Act states that a creditor is not entitled to vote as a creditor at a meeting unless the particulars of its debt has been lodged with the chairperson of the meeting. Accordingly, a POD is provided with this report and must be completed and lodged with the Administrators prior to the meeting to entitle a creditor to participate in the meeting.


26

Form 532 - Appointment of Proxy

Also enclosed (Annexure H) is Form 532, Appointment of Proxy.

Pursuant to Regulation 5.6.28, a person claiming to be the proxy of a person, so appointed by an appropriate instrument (Form 532), is generally not entitled to speak or vote at the meeting unless the instrument has been received by the Chairperson prior to the meeting. Facsimile copies of proxies are acceptable prior to the meeting, but the original document must be lodged with the Administrators within 72 hours after lodging the faxed copy. Proxies may be executed by companies with or without a common seal if it is signed by or if the seal is fixed to it and the fixing of the seal is witnessed by:

(a) two directors of the Company; or (b) a director and secretary of the Company; or (c) a proprietary Company that has a sole director who is also the sole Company secretary -

that director.

Accordingly, any person claiming to be the attorney of a person entitled to attend and vote must ensure that:

(a) The instrument or copy of the instrument by which the person was appointed as attorney has been produced to the chairperson. In the case of a corporation, the instrument must be signed by one of the methods outlined above for proxies. The chairperson is otherwise satisfied that the person claiming to be the attorney of the person or corporation entitled to vote is duly authorised by that person.

(b)

We request that these documents be forwarded to our office by 4:00 PM on 7 September 2017 to facilitate checking and recording.

Telephone conference facilities will be available at the meeting. Creditors can utilise the following conference facility:

Telephone number: Password:

1800 132 423 442 127 2708

Should creditors wish to participate in the meeting by telephone, written notification must be provided to our office no later than 4:00 PM on 7 September 2017. A person who participates in the meeting by telephone must pay any costs incurred and is not entitled to be reimbursed for those costs from the assets of the Company.

13. Further Information

Should creditors require any further information, please contact Adam Treffiletti of this office on (02) 8078 2113 or by email on [email protected]

Dated this 31^ dayj5lAugust 2017

ijRerine Barnet lint & Several Administrator


^ Bentleys THINKING AHEAD

Annexure A: Corporate Structure

Accountants

Auditors

Advisors

A member of Bentleys, a network of independent accounting firms located throughout Australia, New Zealand and China that trade as Bentleys, All members of the Bentleys Network are affiliated only and are separate legal entitles and not in Partnership. Liability limited by a scheme approved under Professional Standards Legislation. 1

KRESTON

Alfred Angelo New Co Holding, LLC (1)

i Alfred Angelo Newco, Inc. (2)

• Alfred Angelo - The

Company Store, Inc, Alfred Angelo

(Australia) Pty Ltd Alfred Angelo - The Brides Studio No.

3, Inc. R-4 R-1 s (3) (15) (2)

jK Alfred Angelo - The Brides Studio No.1

Alfred Angelo de Mexico 1 i '

> ^ f R-2 (4) .(?) PF International, [nc Piccone Fashions UK

LTD (17) Hacienda Brides, Inc

(16) (18) Alfred Angelo - The Brides Studio No. 2,

Inc. R-3 Alfred Angelo de Pern J • •> (5)

I {2>

AA Bridal, LLC DJF, LLC Picclone Fashions Ltd. (19) •> (6) (18)

' AA Florida Bridal Retail Company, LLC Alfred Angelo Canda

UCL (7) < R-7 (20)

II Alfred Angelo - The Brides Studio No. 4,

LLC R-5

Alfred Angelo - The ^ Brides Studio No. 5,

LLC R-6

AA Bridal Northeast, LLC R-8

ZN, LLC * > (8)

(21) (24) (25)

J i Alfred Angelo Investment Company, Limited (Hong

Kong) (9)

AA Bridal Nebraska, LLC R-10 I (22)

BridalMart, LP Texas (27) r AAI China I

Zhuhai AAI China ill AA Bridal Midwest,

LLC R-1Q Shantou > (10) (12) (23)

Key AAI China II Fu Yang

AAI China IV Changde

(11) (13) Retail Entities

[ Zhuhai Haipeng Wedding Dress Co.,

Ltd. (14)

VMiolesale Entities

Wholesale & Retail Entities

, V -tyCofporaiion (Delaware)

! ia:es umued Liaoiii

Alfred Angelo Nnwco, f*. C" Co^porayon <DcJavvarni and Qusufica "SubchaptBr S'Subsidiatiea iFkjrido) (Atîea Anqe'o - Tire Company Slow, m Atfrcd Arvgelci - ThoBrtdei StLKl 10 He 1. ht,. Ali'wd Ar.jehs - Tlw BtWes 1 Studio No 2.lnc.) ) (A^rtEraiiayPty Ltd -AuiâiarTPrtvAlr as a fcrcjgfsditreflatdttd •ntiTy [Otuwon o( A^rvd Angelo Kewco 4 AltrodAfrjBtodolêwca - Meni^qn sntjly ttea'cd as a foielgn di&regardec «.nlilytDivi»lon cf Atf/tsd H# wca Vic )Su*pflndttd Ope I •ton*

" 5 Ally04 Angoiodo PIKU - SourJ^ An)on~cftn"oMiy ftformaol) (reoifrd At a (oiolign tJiufcgaJdecf eiVity iDiviliin ofAi'rad Aoj^.o Mevrio. Inc i Suspended Ope'Btiori* 6 bJ Paihign*, LLC 'Unt»d Ari^'Company YoiX>-Olwon6nufl<l Opflfatscmi —

7 Affrnd Angola C&n&dn ULC - Uplimltod UahilifyCompanyiCa/UKta}

a ZN. LLC - Urntfrd $Ut!»> Co'npany(K»w - Oltcontrued Opcfi&oot 9 Alfred Angelo fnvBStment Company Limited (aka Meadera Limited) - Hong Kong entity treatetl as a foraTgn disregaroad' enuty of Alfred Angelo Newco, inc

Zhuhai Free Trade Zone Bai jing Fashions Company LimKeo -China entity treated as a foreign entity of Aifrea Angelo invEStment Companîmiied/AlfredAngeio tnc in lum a foreign disregaraea enliiyof Alfrea Angelo Newco, mc 10 Oisconlinued Operations

Fu Yang Alfred Angelo Company Limited - China entity treated as a foreign entity of Alfred Angelo investment Company uimHed/AliVed Angelo Newco, inc in turn a foreign disregarded entity of Alfred Angelo Newco inc Discontinued Xi Operations

Sfiantou raK King Garment Comparry Limited - China entity treated as a foreign entity of Alfred Ange/o ftwestment Company umrtea/Alfrea Angelo Newco, fnc in (urn a foreign aisregaraea enuty of Alfred Angeio Newco mc Discontinued 1/ Cpwatioo*

Chargde CrtyAlfred AingaôGarm^nTC&mpany Lim-ted - Cfuna anbty 'jaalsd at a «nbtyof AWr^-d Angelo Inîpnent Coispany Uffl'leo/AIAfd Anjc'o Newco. Inc in iima ftfei^n d»»f«fl4rded erttfiybf Alfred Angeto WeVi'co, K 13 Discontinued Operalions tTûirai Maipeng Wcdatna Orc« Co. La. -dWna 'icoled aYn fore'ijn ir't,?/o'Alfred Angcfo h^fliSnent Coiiipan/brnJie^/A^Hjj Arpul'j Newco. in turn a fofe^ Jltfôaidcd Ai'rcd Angrlo HOMO fa

AiiVfid Afît'a • Tnn Srldtfi SCwJiO Wo. 3. kic ^ Subcbaptnn'S' Subivdiary {Dalawaralol Aifrud AngsloN't'/xo kic PF httrnolionai. nc - Umtfld Slam'Subchapter S Cofooration (Oitaworo}

U PiCCiO-"^ FavMofii UK L'tO - Ui?ltd Îrgdor) CCnporatan^Co Raj'itraiiDii s ICSfi^SS^rvglandiWules ]a Prcctora FasSTons LG - United Kingdom Llmriotl Porlr^rjfip

AASridal, LLC-Palawan Ui-nileo LlabiîyCoinpariyof Al^cci At>j*lo Ne^-co Uc " JO AA Fittuda SfSif^ta^Compftriy, LLC -Fionrta umJleil L'»&lllty Company of Affre a Angcfo U iV Ai l^f^daTljoriheaJl LLC ' D elavâre "LTnitsiJ LTi&^Jrty C oiripany orAffrea1 Ar-gefo N svito. i>: "

1 Allied Angeio Newco Hofding, L Inuec

he)

r.-^n ir-

jjr AA Brtrtol Hfrb!a9i*a. LLC - OeUiviare L'mjlad Linb-JityCorrtpanv of Aiftod AngelQ N'^wCo Inc 23 A A Bndal LLC - Oa vaj* Limii* liability Cootpaoy of A M«nco. inc m Alfred AngBiQ - Tt-p Br.dg j Sti^d'-o No A. L - 1 J^tpd £t.rir L i oil iff d .tattii-^ Company 25 Alfred Angelo"- Th# 3 r-3e't S tud'O ^-o" fl LLC - L ofttlily C ct.npa«y o'AINU Angi»:o Nr.vu ho ^ BonatWart LP -Un.»d 3iai« Ltmneo Pamenii p (T j7 HBl —Hncierwa Bridai - 9tAjch»ptoi S: SubiidiaiyiCilifomiaj orArlred Ar-gElof'ilBrtco, IU 28 OZ Hoidinfl Company. LLC - U«5tfd Sla1#» Limiied LiabJ'ityCofflpany(Nn'-v Vork) - 0*i.wfi(inycd Cpara^KWtA

Annexure B: Declaration of Independence, Relevant

Relationships and Indemnities

CORPORATIONS ACT 2001

Section 436DA

DECLARATION OF INDEPENDENCE, RELEVANT RELATIONSHIPS AND INDEMNITIES


ACN 110 816 861

This document requires the Practitioner appointed to an insolvent entity to make declarations as to:

A. their independence generally;

B. relationships, including

i. the circumstances of the appointment;

ii. any relationship with the insolvent entity and others within the previous 24 months;

ill. any prior professional services for the insolvent entity within the previous 24 months:

Iv. that there are no other relationships to declare; and

C. any indemnities given, or up-front payments made, to the Practitioner.

This declaration is made in respect of ourselves, our partners and Bentleys Corporate Recovery Pty Ltd (our firm).

A. Declaration of Independence

We, Katherine Elizabeth Barnet and Hugh Armenis of Bentleys Corporate Recovery Pty Ltd have undertaken a proper assessment of the risks to our independence prior to accepting the appointment as joint and several Administrators of Alfred Angelo (Australia) Pty Ltd ("the Company") in accordance with the law and professional standards. This assessment identified no real or potential risks to our independence. We are not aware of any reasons that would prevent us from accepting this appointment.

B. Declaration of Relationships

(i) Circumstances of Appointment

The Company/directors were referred to us by Henry Davis York ("HDY") who act for FSJC V, LLC ("FSJC"), an affiliate of private equity firm Czech Asset Management ("Czech") and secured creditor of the Company. Our firm has a professional relationship with HDY.

In the week prior to accepting the appointment, we had the following communications with HDY and Czech:

On 25 July 2017, we had a telephone discussion with HDY to discuss a potential appointment as external administrators of the Company and were provided with relevent documents pertaining to the background of the Company and it's relationship with FSJC;

On 26 July 2017, we attended a meeting with HDY and Czech to discuss the potential appoinment;

On 29 July 2017 and 30 July 2017 we exchanged various emails with HDY and Czech regarding the potential appointment;

On 31 July 2017, we exchanged various emails with HDY and Tripp Scott Attorneys, being the solicitors for Czech, regarding the potential appointment;

On 2 August 2017, we received various emails with HDY and Tripp Scott Attorneys, being the solicitors for Czech, regarding the potential appointment;

On 4 August 2017, we were provided with executed appointment documents from the directors of the Company.

All of these meetings/telephone conversations were for the purposes of:

Gaining an understanding of the Company, its financial position, its business and its trading history;

Discussing the various options available to the Company and the nature and consequences of an insolvency appointment; and .

Provide a consent to act and to have executed by the directors my pre-appointment disclosure of proposed basis of remuneration.

We received no remuneration for these meetings/ telephone conversations.

In our opinion, the above matters do not affect our independence for the following reasons:

it is recognised by the Courts and the Australian Restructuring and insolvency Turnaround Association ("ARITA") Code of Professional Practice that pre-appointment advice on the insolvency process and available options is necessary and does not amount to an impediment to accepting an appointment;

The nature of the advice provided was such that it would not be subject to review and challenge during the course of the appointment; and

The pre-appointment advice provided will not influence our ability to fully comply with the statutory and fiduciary obligations associated with the appointment in an objective and impartial manner.

We provided no other information or advice to the Company or any of its directors prior to our appointment beyond that outlined in this DIRRI.

(ii) Relevant Relationships (excluding professional services to the Insolvent)

Neither we nor our firm, have, or have had within the preceding 24 months, any relationships with the Company, an associate of the Company, a former Insolvency practitioner appointed to the Company or any person or entity that has security over the whole or substantially the whole of the Company's property.

(ill) Prior Professional Services to the Insolvent

Neither us, nor our firm, have provided any professional services to the Company In the previous 24 months.

(iv) No Other Relevant Relationships to Disclose

There are no other known relevant relationships, Including personal, business and professional relationships, from the previous 24 months with the Company, an associate of the Company, a former Insolvency Practitioner appointed to the Company or any person or entity that has a charge on the whole or substantially whole of the Company's property that should be disclosed.

C. Declaration of Indemnities and up-front payments

We have not been indemnified in relation to this liquidation, other than any indemnities that we may be entitled to under statute and we have not received any up-front payments in respect of our remuneration or disbursements.

DATED THIS 7th day August 2017

Catherine E Barnet Joint and Several Administrator

Hugh Armenis Joint and Several Administrator

NOTE: If circumstances change, or new information is identified, we are required under section 60(2) and 506A(5) of the Corporations Act 2001 and the provisions of the ARITA Code of Professional Practice to update this Declaration and provide a copy to creditors with our next communication as well as table a copy of any replacement declaration at the next meeting of the company's creditors.

Annexure C: ARTIA Creditor Information Sheet

Creditor Information Sheet

Offences, Recoverable transactions and Insolvent Trading ARITA Offences A summary of offences that may be identified by the administrator:

Section Offence 180 Failure by officer to exercise a reasonable degree of care and diligence in the exercise of his powers

and the discharge of his duties. 181 Failure to act in good faith. 182 Making improper use of position as an officer or employee, to gain, directly or indirectly, an advantage.

Making improper use of information acguired by virtue of his position. Reckless or intentional dishonesty in failing to exercise duties in good faith for proper purpose. Use of position or information dishonestly to gain advantage or cause detriment. Contravening an order against taking part in management of a corporation. Taking part in management of corporation while being an insolvent under an administration, Acting as a director or promoter or taking part in the management of a company within five years after conviction or imprisonment for various offences. Dishonest failure to observe reguirements on making loans to directors or related companies. Paying dividends except out of profits.

183 184

206A 206A, B 206A, B

209(3) 254T 286 Failure to keep proper accounting records. 312 Obstruction of auditor. 3U-7 Failure to comply with reguirements for financial statement preparation.

Performing or exercising a function or power as officer while a company is under administration. Unauthorised dealing with company's property during administration. Failure by directors to assist administrator, deliver records and provide information.

437C 4370(5) 438814) 4380(5) Failure to deliver up books and records to administrator. 590 Failure to disclose property, concealed or removed property, concealed a debt due to the company,

altered books of the company, fraudulently obtained credit on behalf of the company, material omission from Report as to Affairs or false representation to creditors.

Voidable Transactions Preferences A preference is a transaction such as a payment between the company and one or more of its creditors, in which the creditor receiving the payment is preferred over the general body of creditors. The relevant time period is six months before the commencement of the liquidation. The company must have been insolvent at the time of the transaction, or become insolvent as a result of the transaction.

Where a creditor receives a preferred payment, the payment is voidable as against a liquidator and is liable to be paid back to the liquidator subject to the creditor being able to successfully maintain any of the defences available to the creditor under either the Corporations Act.

Uncommercial Transaction An uncommercial transaction is one that it may be expected that a reasonable person in the company's circumstances would not have entered into having regard to: • the benefit or detriment to the company; • the respective benefits to other parties; and • any other relevant matter.

To be voidable, an uncommercial transaction must have occurred during the two years before the liquidation.

However, if a related entity is a party to the transaction, the time period is four years and if the intention of the transaction is to defeat creditors, the time period is ten years.

Level 5, 33 Erskine Street, Sydney NSW 2Q00 Australia I GPO Box 9985, Sydney NSW 2001 t+61 2 9290 5700 I f+61 2 9290 2820 I e adnnin@arita,com.au I arita.com.au

ARITA ACN 002 472 362

AUSTRALIAN RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION

% ARITA

The company must have been insolvent at the time of the transaction, or become insolvent as a result of the transaction.

Unfair Loan A loan is unfair if and only if the interest was extortionate when the loan was made or has since become extortionate. There is no time limit on unfair loans - they only have to have been entered into any time on or before the day when the winding up began.

Arrangements to avoid employee entitlements If an employee suffers loss because a person (including a director) enters into an arrangement or transaction to avoid the payment of employee entitlements, the liquidator or the employee may seek to recover compensation from that person. It will only be necessary to satisfy the court that there was a breach on the balance of probabilities. There is no time limit on when the transaction occurred.

Unreasonable payments to directors Liquidators have the power to reclaim "unreasonable payments" made to directors by companies prior to liquidation. The provision relates to transactions made to, on behalf of, or for the benefit of, a director or close associate of a director. To fall within the scope of the section, the transaction must have been unreasonable, and have been entered into during the years leading up to a company's liquidation, regardless of its solvency at the time the transaction occurred.

Voidable charges Certain charges are voidable by a liquidator: • Circulating security interest created with six months of the liquidation unless it secures a

subsequent advance; • Unregistered charges; and • Charges in favour of related parties who attempt to enforce the charge within 6 months of its

creation.

Insolvent Trading In the following circumstances, directors may be personally liable for insolvent trading by the company; • a person is a director at the time a company incurs a debt; • the company is insolvent at the time of incurring the debt or becomes insolvent because of

incurring the debt; • at the time the debt was incurred, there were reasonable grounds to suspect that the company was

insolvent; • the director was aware such grounds for suspicion existed; and • a reasonable person in a like position would have been so aware.

The law provides that the liquidator, and in certain circumstances the creditor who suffered the loss, may recover from the director, an amount equal to the loss or damage suffered. Similar provisions exist to pursue holding companies for debts incurred by their subsidiaries.

A defence is available under the law where the director can establish: • there were reasonable grounds to expect that the company was solvent and they actually did so

expect; • they did not take part in management for illness or some other good reason; or, • they took all reasonable steps to prevent the company incurring the debt.

The proceeds of any recovery for insolvent trading by a liquidator are available for distribution to the unsecured creditors before the secured creditors.

Important note; This information sheet contains a summary of basic information on the topic. It is not a substitute for legal advice. Some provisions of the law referred to may have important exceptions or qualifications. This document may not contain all of the information about the law or the exceptions and qualifications that are relevant to your circumstances.

AUSTRALIAN RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION PAGE 2

Annexure D: Estimated Outcome Statement

ALFRED ANGELO (AUSTRALIA) PTY LTD ACN 110 816 861

ESTIMATED RETURN TO CREDITORS

High $ Low $ Assets Non-circulating asset realisations

0 0

Less: Secured Creditor (General Security Agreement) 78,343,577 78,343,577

Net secured non-circulating asset realisations (cfd) 78.343,577 78,343,577

Circulating asset realisations Cash at bank Inventory Trade Debtors

185,889 185,889 unknown 0 302,014 18,676 487,903 204,565

Total estimated asset realisations 487,903 204,565

Priorities pursuant to Section 556 of the Act

Costs of Administration (incl. GST) Administrators' disbursements

Insurance & Workcover Wages Agents fees and commision Provision

1,000 10,874

2,000 10,874

1,500 2,000

500 1,000

13,374 16,374

Administrators' remuneration Admininstrators' remuneration for the period 4/8/2017 to 24/8/2017 Admininstrators' future remuneration for the period 25/8/2017 to 8/9/2017

45,644 13,500

45,644 13,500

59,144 59,144

Liquidators' remuneration for the period 6/9/2017 to finalisation 36,000

403,518 |

36,000

Total Costs of Administration (incl. GST) 111,518

Priority Creditors Unpaid wages Superannuation Annual Leave Long Service Leave Payment in Lieu of Notice Redundancy

0 0 0 0

18,888 13,664 13,208 32,716

18,888 13,664 13,208 32,716

78,477 78,477

Estimated funds available to Secured Creditor 300,908 14,570

Less: Secured Creditor (bal c/d) 78,343,577 78,343.577

Estimated Surplus/ (Deficiency) available to Unsecured Creditors 3 i

Unsecured Creditors 1,439,673 1,439,673

Total Suplus/Deficiency 1,439,673 1,439,673

Estimated Dividend to the Unsecured Creditors (cents/S) s E

Annexure E: Remuneration Report


Section 449E, 473, 495 & 499

Remuneration Report


ACN 110 816 861

Table of Contents

Part 1: Part 2: Part 3: Part 4: Part 5: Part 6: Part 7: Part 8; Part 9: Part 10 Part 11 Part 12

Declaration Executive summary Administrators' time costs to date Future Administrators' time costs Future Liquidators' time costs Statement of remuneration claim Remuneration recoverable from external sources Disbursements Summary of receipts and payments Queries Information sheet Initial advice to creditors

Part 1: Declaration

We, Katherine Elizabeth Barnet and Hugh Armenis, have undertaken a proper assessment of this remuneration claim for our appointment as Voluntary Administrators of Alfred Angelo (Australia) Pty Ltd (Administrators Appointed) in accordance with the law and applicable professional standards. We are satisfied that the remuneration claimed is in respect of necessary work, properly performed or to be properly performed in the conduct of the Administration.

Part 2: Executive summary

This remuneration report details approval sought for the following resolutions:

Report Amount $ reference (excl. GST)

Period: 4 August 2017 to conclusion

Voluntary Administration;

Resolution 1: 4 August 2017 to 24 August 2017 Part 3 45,643.50

Resolution 2: 25 August 2017 to 8 September 2017 Part 4 13,500.00

Liquidation (if applicable):

Resolution 3: 9 September 2017 to finallsatlon Part 5 36,000.00

Total 95,143.50

Approval for the future remuneration sought is based on an estimate of the work necessary to the completion of the Administration and Liquidation (if applicable). Should additional work be necessary beyond what is contemplated, further approval may be sought from creditors.

Please refer to the report section references detailed above for full details of the calculation and composition of the remuneration approval sought.

Part 3: Administrators' time costs to date

Company: Alfred Angelo (Australia) Pty Ltd Period from: 4 August 2017 (Administrators Appointed)

Practitioners: Katherine Elizabeth Barnet & Hugh Armenis

Administration Voluntary Administration type:

Period to: 24 August 2017

Firm: Bentleys Corporate Recovery

Task Area General Description Includes Banking > Identifying the whereabouts of the Cash on

Hand of the company. > Requesting the closure of the Company's bank

accounts. > Transferring funds to the bank account of the

administration. Debtors > Reviewing and assessing debtors' ledgers.

> Cleaning debtor ledger data. > Drafting and reviewing letters of demand issued

to debtors. > Attending the premises to retrieve cheques of

drawn to the Company. > Discussions conducted with former employees

regarding: > Details of the debtors ledger > Engaging the former employees to conduct

debtor collections. > Forwarding bespoke emails to each debtor of

the company. > Creating a debtor register. > Responding to debtor emails and phone calls. > Recording all debtor conversations in the debtor

register. > Updating outstanding debtor amounts based on

payments received.

Assets

Number of hours: 39.4 Actual cost: $11.253.50

Stock > Attending the premises of the Company to collect the stock.

> Liaising with agents regarding the collection and warehousing of the stock.

> Organising for photographs and stock listings to be conducted.

> Review of creditor ledger. > Receiving and following up on creditor enquiries

via telephone and email. > Maintaining creditor enquiry register.

General

Task Area General Description Includes > Drafting and circulating correspondence to

utilities companies and suppliers regarding the Administration.

> Review and prepare correspondence to creditors and their representatives via facsimile, email and post.

> Liaising with landlord of the property. > Establishing initial contact with the ATO.

Preparation of meeting notices, proxies and advertisements.

> Forwarding notice of meeting to all known creditors.

> Preparation of meeting file, including: > Agenda > Attendance register > Certificate of postage > List of creditors > Proofs of debts; and > Proxies

> Convening 1st meeting of creditors. > Communication with creditors to ensure a

quorum is present. > Attending 1st meeting of creditors.

> Preparing a summary of the statement of financial performance and position.

> Preparing estimated outcome statement to provide potential return to creditors.

> Drafting the report to creditors pursuant to section 439A of the Act

Meeting of Creditors

Creditors

Number of hours: 55.3 Actual cost: $21,236.00

Report

> Discussing outstanding issues with employees of the Company.

> Establishing contact with the entity which dealt with the payroll of the Company.

> Gaining authority to retrieve pertinent employee reports of the Company.

> Searching for and reviewing security documents.

> Drafting and issuing 433B notice - Notice of Administrator's Intention not to Exercise

Employees

Secured Creditors

Property Rights. > Producing and reviewing 1st day documents. > Reviewing Chapter 7 Documentation. > Sourcing and reviewing statutory searches of

the Company. > Liaising with financial institutes to ascertain the

cash position of the Company and retrieve bank statements.

Investigations Conducting Investigations


> Drafting and issuing correspondence to the Directors of the Company.

> Reviewing the completed Director's statement about the Company's business, property, affairs and financial information.

> Reviewing the completed Director's questionnaire.

Task Area General Description Includes > Discussions with the Director regarding the

Company. > Communicating with the Company accountants

in the US. > Communicating with the CFO of the US Alfred

Angeio. > Engaging the CFO to retrieve financial records

of the Company. > Attending the premises to retrieve the books

and records of the Company. > Liaising with former employees in attempts to

gain access to the Company's digital records. > Investigating financials and preparing file notes

of findings. > > Opening an Administration bank account > Processing receipts and payments. > Conducting bank account reconciliations. > Providing the insurance broker with the details

of the Company's operations. > Reviewing insurance policies. > Updating the insurance broker as to the

progress of gaining possession of stock.

Bank account administration

Insurance

Administration


Document maintenance / file review / checklist

> Uploading and updating the checklist > Filing documents > Processing the creditor details into the

accounting system > Preparing and lodging the required statutory

lodgements. > Upload the notice of appointment to the ASIC

insolvency notices website > Meetings regarding strategy and status of the

Administration

ASIC Reporting

Planning / review

Total actual hours: Total actual cost:

148.2 hours $50,715.00 excl. GST ($55,786.50 incl. GST)

Prior to commencing our appointment as Administrators, we agreed to provide a 10% discount on our time costs incurred in the administration.

Accordingly, the remuneration sought as Administrators for the period of 4 August 2017 to 24 August 2017 totals $45,643.50 excl. GST ($50,207.85 incl. GST) being a 10% discount on the above calculated time costs.

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Part 4: Future Administrators' time costs

Company: Alfred Angelo (Australia) Pty Ltd Period from: 25 August 2017 (Administrators Appointed)

Practitioners: Katherine Elizabeth Barnet & Hugh Armanis


Period to: 8 September 2017


Task Area General Description Includes > Review engagement proposal from agent/s. > Review photographs and stock listings

provided by the agent. > Formulate a strategy about the best way to

dispose of the stock. > Engage in the sale of the stock. > Engage former employees to attempt to

collect outstanding debtors. > Review of correspondence between the

former employees and debtors of the Company.

> Process the receipts and update debtor register.

> Retrieve and review invoices from the CFG of the parent entity.

> Consider conducting legal action for unpaid debtors.

Assets Stock

Number of hours: 15 Estimated cost: $5,000.00

Debtors

Creditors Communication with creditors

> Liaise with the creditors via telephone and email regarding the Administration.


2nd Meeting of Creditors

> Finalise drafting the 439a Report to creditors > Preparation of the Remuneration Report for

inclusion in the report. > Prepare a summary of receipts and

payments > Prepare statutory documents to convene the

meeting of creditors on 5 September 2017. > Circulate the report by mail and email. > Draft and upload advertisement of the

meeting of creditors to be held on 5 September 2017.

> Review and upload proofs of debt and proxies into the accounting system.

> Preparation of meeting file, including: > Agenda > Attendance register > Certificate of postage > List of creditors > Proofs of debt; and > Proxies.

Task Area General Description Includes > Convening 2nd meeting of creditors. > Liaise with the creditors regarding

attendance at the 2nd meeting of creditors. > Attending 2nd meeting of creditors. > Draft and lodge the minutes of the 2nd

meeting of creditors. > Communicating with the Company

accountants in the US. > Communicating with the CFG of the US

Alfred Angelo. > Investigating financials and preparing file

notes of findings.

Investigations Conducting investigations


Administration Bank account administration

> Process receipt and payment vouchers. > Prepare bank account reconciliations.


Insurance > Liaise with the insurance broker and provide details of the Company's operations.

Document maintenance / file review / checklist

> File documents > Update checklists > Prepare correspondence by mail and email > Update the creditor details in the accounting

system

Total estimated hours: Total estimated cost:

45 hours $15,000.00 excl. GST ($16,500.00 Incl. GST)


Accordingly, the remuneration sought as Administrators for the period of 25 August 2017 to 8 September 2017 totals $13,500 excl. GST ($14,850 incl. GST) being a 10% discount on the above calculated time costs.

Part 5: Future Liquidators' time costs

Company: Alfred Angelo (Australia) Pty Ltd Period from: 9 September 2017 (Administrators Appointed)

Practitioners: Katherine Elizabeth Barnet & Hugh Armenis


Period to: Finalisation


Task Area General Description Includes > Continue to engage in the sale of the stock. Assets Stock > > Process the receipts and update debtor

register. > Consider conducting legal action for unpaid

debtors.

Debtors Number of hours: 40 Anticipated cost: $16,400

Creditors Communication with creditors

> Liaise with the creditors via telephone and email regarding the Liquidation.

Number of hours: 20 Anticipated cost: $8,150.00

Meeting of the creditors

> Prepare and circulate notice of any meeting of the creditors.

> Draft statutory documents to convene any meeting of the creditors.

> Prepare and upload the advertisement of any meeting of the creditors.

> Review and upload proofs of debt and proxies into the accounting system

> Preparation of meeting file, including: > Agenda > Attendance register

. > Certificate of postage > List of creditors > Proofs of debt; and > Proxies.

> Liaise with the creditors regarding attendance at any meeting of the creditors.

> Attend the final meeting of the creditors. > Draft and lodge the minutes of any meeting of

the creditors including the final meeting of the creditors.

Investigations Report to ASIC > Prepare a file note summarising the results of the investigations.

> Prepare the statutory investigation reports. > Liaise with ASIC with regards to any queries

raised. > Prepare the Liquidators' report pursuant to


Task Area General Description Includes section 533 of the Act.

Conduct investigations

> Archive the Company's books and records > Review the Company's records. > Investigate financials and prepare file note

regarding potential claims. > Finalise the position on potential recovery

actions. Dividend Dividend procedures > Draft and circulate correspondence to

creditors advising of intention to declare a dividend, if applicable.

> Prepare the dividend file including a time line schedule.

> Prepare the dividend calculation spread sheet. > Draft correspondence to creditors announcing

the declaration of a dividend. > Draft correspondence to creditors enclosing

the payment of dividends.


Administration Document maintenance / file review / checklist

> Administration review. > File documents. > File reviews. > Update checklists.

Number of hours: 10 Anticipated cost: $3,650.00 Bank account

administration > Prepare receipt and payment vouchers. > Prepare bank account reconciliations.

ASIC statutory forms > Lodge ASIC forms. > Draft correspondence with ASIC regarding

statutory forms. ATO reporting > Prepare and lodge BAS statements. Finalisation > Notify the ATO of finalisation.

> Cancel ABN / GST / PAYG registrations. > Complete checklists. > Finalise the WIP.

Total anticipated hours: Total anticipated cost:

100 hours $40,000.00 excl. GST ($44,000 incl. GST)


Accordingly, the remuneration sought as Administrators for the period of 9 September 2017 to finalisation totals $36,000 excl. GST ($39,600 incl. GST) being a 10% discount on the above calculated time costs.

Please refer to the statement of remuneration claim for details of the resolutions to be sought at the second meeting of the creditors of the Company to be held on Friday, 8 September 2017 at 11.00 AM. Details of actual charges and amounts drawn will be available for inspection by creditors on request.

Part 6: Statement of remuneration claim

We intend to seek creditors' approval of the foilowing fee resoiutions at the meeting of creditors to be heid on Friday, 8 September 2017 at 11.00 AM.


"That the remuneration of the Administrators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 4 August 2017 to 24 August 2017 inclusive in the fixed amount of $45,643.50 excl. GST ($50,207.85 incl. GST] plus disbursements and that the Administrators be authorised to draw fees up to this amount at their discretion."


"That the remuneration of the Administrators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 25 August 2017 to 8 September 2017 inclusive in the fixed amount of $13,500 excl. GST ($14,850 incl. GST) plus disbursements and that the Administrators be authorised to draw fees up to this amount at their discretion."

Resolution 4 - Future Liquidators' Remuneration ftf apoointedl

"That the remuneration of the Liquidators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 9 September 2017 onwards in the interim amount of $36,000.00 excl. GST ($39,600.00 incl. GST) and disbursements and that the Liquidators be authorised to raw such fees from time to time as they are accrued up to this amount. If this limit is exhausted, the Liquidators will seek further fee approval from a committee of inspection, if any, creditors, or the court."

Creditors are advised that they have the right to obtain further information regarding the Administrators' and the Liquidators' remuneration by advising this office in writing. Creditors are advised that a remuneration information sheet is available at httD://www,asic.QOV.au/infosheets.

Part 7: Remuneration recoverable from external sources

To date we have not received any remuneration from external sources such as the Department of Education, Employment and Workplace Relations or the Australian Securities and Investments Commission.

Part 8: Disbursements

Disbursements are divided into three types: A, B1, B2.

A disbursements are all externally provided professional services and are recovered at cost. An example of an A disbursement is legal fees.

B1 disbursements are externally provided non-professional costs such as travel, accommodation and search fees. B1 disbursements are recovered at cost.

B2 disbursements are internally provided non-professional costs such as photocopying and document storage. B2 disbursements are charged at cost except for photocopying, printing and telephone calls which are charged at a rate which is intended to recoup both variable and fixed costs.

Creditor approval for the payment of disbursements is not required. However, the Administrators must account to creditors and creditors have the right to question the incurring of disbursements and can challenge disbursements in court.

I have undertaken a proper assessment of disbursements claimed in accordance with the law and applicable professional standards. I am satisfied that the disbursements claimed are necessary and proper.

Basis of disbursement claim:

Disbursements Classification Rate (excl. GST) Amount $ Travel Mail Redirect ASIC Insolvency Notice Total

B1 At cost 25.54 732.59 B1 At cost

At cost B1 5.00 763.13

Part 9: Summary of receipts and payments

A summary of receipts and payments in the Administration is attached to the Report to Creditors dated 31 August 2017.

Part 10: Queries

Should you have any queries in relation to matters outlined in this remuneration report, please contact Mr Scott Norris of this office on (02) 8078 2103 or at [email protected].

Part 11: Information sheet

The Australian Securities and Investments Commission have prepared an information sheet for creditors providing guidance on approving the remuneration of an external Administrator. The information sheet titled 'Approving Fees: A Guide for Creditors' can be located at www.asic.qov.au/insolvencvinfosheets.

Part 12: Initial advice to creditors

Remuneration methods

There are four basic methods that can be used to calculate the remuneration charged by an insolvency practitioner. They are:

Time based / hourly rates This is the most common method. The total fee charged is based on the hourly rate charged for each person who carried out the work multiplied by the number of hours spent by each person on each of the tasks performed.

Fixed fee The total fee charged is normally quoted at the commencement of the Administration and is the total cost for the Administration. Sometimes a practitioner will finalise an Administration for a fixed fee.

Percentage The total fee charged is based on a percentage of a particular variable, such as the gross proceeds of assets realisations.

Contingency The practitioner's fee is structured to be contingent on a particular outcome being achieved.

Method chosen

Given the nature of this Administration we propose that our remuneration be calculated on time based / hourly rates. This is because:

> It ensures that creditors are only charged for work that is performed as time is recorded and charged in six minute units.

> It is not possible to estimate with certainty the total amount of fees necessary to complete all tasks required in this Administration.

Explanation of hourly rates as at 1 July 2016

The rates for our remuneration calculation are set out in the following table together with a general guide showing the qualifications and experience of staff engaged in the Administration and the role they take in the Administration. The hourly rates charged encompass the total cost of providing professional services and should not be compared to an hourly wage.

The most current rates are outlined in the table below.

Classification Rate Guide to Level of Insolvency Experience

Registered Liquidator/Trustee. Partner bringing his/her specialist skills to administrations and/or insolvency tasks.

Partner 615

Associate Director/ Principle

Typically CA or CPA qualified with in excess of 10 years' experience on insolvency 550 matters with a number of years at manager level. Specialist industry knowledge who

assists the appointee with all facets of administrations.

Typically qualified. 8+ years' experience. Well-developed technical and commercial skills, bringing additional specialist skills to administrations and/or insolvency tasks.

Senior Manager 490

Typically Qualified. 6-8 years' experience. Well-developed technical and commercial skills. Planning and control of all administrations and/or insolvency tasks.

Manager 450

Typically qualified. 4-7 years' experience. Co-ordinates planning and control of medium to larger administrations and/or insolvency tasks.

Supervisor 390

Typically graduate/qualified. 2-4 years' experience. Required to control the fieldwork on administrations and/or insolvency tasks.

Senior 1 345

Typically graduate. 1 -2 years' experience. Required to control the fieldwork on Administrations and/or Insolvency tasks.

Senior 2 320

Typically graduate. Up to 2 years' experience. Required to control the fieldwork on small administrations and/or insolvency tasks and assist with fieldwork on medium to large administrations and/or insolvency tasks.

Intermediate 1 280

Typically undergraduate. Up to 2 years' experience. Required to assist in day to day fieldwork of administrations and/or insolvency tasks under the supervision of more senior staff.

Intermediate 2 230

Support 170 Appropriate skills.

Junior 90 Appropriate skills including machine usage.

Annexure F: Summarised Receipts & Payments

Summarised Receipts & Payments

Alfred Angelo (Australia) Pty Ltd (Administrators Appointed) (Administrators Appointed) Transactions From 04 August 2017 To 31 August 2017

Account Net GST Gross

Sundry Debtors (B) Cash at Bank

$12,342.80 $182,359.11

$0.00 $12,342.80 $0.00 $182,359.11

$194,701.91 $0.00 $194,701.91 Total Receipts (inc GST)

$0.00 $0.00 $0.00 Total Payments (inc GST)

Balance in Hand - By Bank Account Cheque Account 212 194,701.91

$194,701.91

Annexure G: Notice of Meeting

FORM 529

CORPORATIONS ACT 2001 Section 439A

Subregulation 5.6.12(6)

NOTICE OF MEETING OF CREDITORS ALFRED ANGELO (AUSTRALIA) PTY LTD

(ADMINISTRATORS APPOINTED) ACN 110 816 861

NOTICE is given that a meeting of the creditors of the company wiil be held at the offices of Bentieys Corporate Recovery Pty Ltd, Level 3, 1 Castiereagh Street Sydney NSW 2000 on 8 September 2017 at 11:00 am.

A G E N D A

1. To receive a Statement about the company's business, property, affairs and financial circumstances.

2. To receive a statement to creditors by one of the directors, explaining the circumstances leading up to the Administration.

3. To receive the report of the Administrator.

4. Questions from creditors.

5. For creditors to resolve:

a. that the company execute a Deed of Company Arrangement; or b. that the administration should end; or c. that the company be wound up.

6. To fix the remuneration of the Administrator.

7. If the company is to execute a Deed of Company Arrangement to fix the remuneration of the Deed Administrator.

8. If the company is wound up, to consider appointing a Committee of Inspection.

9. If no Committee is appointed, to fix the remuneration of the Liquidator.

10. If no Committee is appointed, to consider the destruction of the books and records at the conclusion of the winding up.

11. Any other business that may be lawfully brought forward.

Telephone conference facilities wiil be available at the meeting. The telephone number to call is 1800 132 423 (password; 442 127 2708). Please note under Corporations Regulations 5.16.13A:

(a) A person, or the proxy or attorney of a person, who wishes to participate in the meeting by telephone must give to the liquidator, not later than the second-last working day before the day on which the meeting is to be held, written statement setting out: (i) the name of the person and of the proxy or attorney (if any); and


(ii) an address to which notices to the person, proxy or attorney may be sent; and

(iii) a telephone number at which the person, proxy or attorney may be contacted; and

(iv) any facsimile transmission number to which notices to the person, proxy or attorney may be sent.

A person, or the proxy or attorney of a person, who participates in the meeting by telephone must pay any costs incurred by the person, proxy or attorney in participating and is not entitled to be reimbursed for those costs from the assets of the company.

(b)

Proxies to be used at the meeting should be lodged at the office of the Administrator by 4.00pm on the day prior to the meeting. A creditor can only be represented by proxy or by an attorney pursuant to corporations Regulations 5.6.28 and 5.6.32 (inclusive) and if a body corporate by a representative appointed pursuant to Section 250D.

In accordance with Regulation 5.6.23(1) of the Corporations Regulations, creditors will not be entitled to vote at this meeting unless they have previously lodged particulars of their claim against the company in accordance with the Corporations Regulations and that clause has been admitted for voting purposes wholly or in part by the voluntary administrator.

n/SEDATED thlsc jf day of August 2017.

^atfierine E 'bSrnet Joint and Several Administrator

Bentleys Corporate Recovery Pty Ltd GPO Box 1466 SYDNEY NSW 2001

Annexure H: Appointment of Proxy Form

Bentleys* Annexure I: Formal Proof of Debt THINKING AHEAD

Accountants

Auditors

Advisors

A member of Bentleys, a network of independent accounting firms located throughout Australia, New Zealand and China that trade as Bentleys. Ali members of the Bentleys Network are affiliated only and are separate iegai entities and not in Partnership. Liability limited by a scheme approved under Professional Standards Legislation. \ KRESTON

FORM 532 Regulation 5.6.29


APPOINTMENT OF PROXY CREDITORS MEETING


A.C.N. 110 816 861 (the Company)

*l/*We (1)

of

a creditor of Alfred Angelo (Australia) Pty Ltd (Administrators Appointed), appoint (2)

or in his or her absence

as *my / our *general / special proxy to vote at the meeting of creditors to be held at 11:00am on

Friday 8 September 2017 (AEST) or at any adjournment of that meeting. (3)

Resolution For Against Abstain


"That the remuneration of the Administrators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 4 August 2017 to 24 August 2017 inclusive in the fixed amount of $45,643.50 excl. GST ($50,207.85 incl. GST) plus disbursements and that the Administrators be authorised to draw fees up to this amount at their discretion."

a • a


"That the remuneration of the Administrators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 25 August 2017 to 8 September 2017 inclusive in the fixed amount of $13,500 excl. GST ($14,850 incl. GST) plus disbursements and that the Administrators be authorised to draw fees up to this amount at their discretion."

• • •

Resolution 3 - Future of the Company:

The Company be placed in Liquidation • • •

"That the Company be placed into Voluntary Liquidation and that Katherine Elizabeth Barnet and Hugh Armanis be appointed Joint and Several Liquidators of the Company."

Resolution For Against Abstain

• • • Resolution 4 - Future Liquidators' Remuneration (if appointed)

"That the remuneration of the Liquidators, their partners and staff be calculated on a time basis at the hourly rates charged by Bentleys Corporate Recovery and be approved for the period 9 September 2017 onwards in the Interim amount of $36,000.00 excl. GST ($39,600.00 Incl. GST) and disbursements and that the Liquidators be authorised to raw such fees from time to time as they are accrued up to this amount. If this limit is exhausted, the Liquidators will seek further fee approval from a committee of Inspection, if any, creditors, or the court." • • •

Resolution 5 - Appointment of a Committee of Inspection:

• • • "That subject to the Company being placed in Voluntary Liquidation, a Committee of Inspection be appointed."

Resolution 6 - Destruction of Books and Records:

"That subject to obtaining the approval from the Australian Securities and Investments Commission pursuant to Section 542(4) of the Corporations Act 2001 the books and records of the Company and of the Joint and Several Liquidators be disposed of by the Joint and Several Liquidators six months after the dissolution of the Company."

• • •

DATED this day of 2017

Signature

CERTIFICATE OF WITNESS

This certificate is to be completed only if the person giving the oroxv is blind or incapable of writing. The signature of the creditor, contributory, debenture holder or member must not be witnessed by the person nominated as proxy.

I. of certify that the above instrument appointing a proxy was completed by me in the presence of and at the request of the person appointing the proxy and read to him or her before he or she signed or marked the instrument.

Dated:

Signature of Witness;

Description:

Place of Residence:

Strike out if inapplicable If a firm, strike out "I" and set out the full name of the firm. Insert the name, address and description of the person appointed. If a special proxy add the words "to vote for" or the words "to vote against" and specify the particular resolution.

(D (2) (3)

FORM 535 CORPORATIONS ACT 2001

Subregulation 5.6.49(2)

FORMAL PROOF OF DEBT OR CLAIM (GENERAL FORM) ' ALFRED ANGELO (AUSTRALIA) PTY LTD

(ADMINISTRATORS APPOINTED) AON 110 816 861

To the Administrator of Alfred Angelo (Australia) Pty Ltd (Administrators Appointed) (Subject to Deed of Company Arrangement)

This is to state that the company was, on 4 August 2017 ^ and still is, justly and truly indebted to(2)

for dollars and cents.

Particulars of the debt are: Consideration13' Amount GST Remarks'4'

included Date

$ $

To my knowledge or belief the creditor has not, nor has any person by the creditor's order, had or received any manner of satisfaction or security for the sum or any part of it except for the following:'5'

3.'6'* I am employed by the creditor and authorised in writing by the creditor to make this statement. I know that the debt was incurred for the consideration stated and that the debt, to the best of my knowledge and belief, still remains unpaid and unsatisfied.

3.'6'* I am the creditor's agent authorised in writing to make this statement in writing. I know that the debt was incurred and for the consideration stated and that the

debt, to the best of my knowledge and belief, still remains unpaid and unsatisfied.

DATED this day of 2017

Signature of Signatory

NAME IN BLOCK LETTERS

Occupation

Address

See Directions overleaf for the completion of this form

• 1 nominate to receive electronic notification of notices or documents in accordance with section 600G of the Corporations Act 2001 at the following email address;

Email address:

ALFRED ANGELO (AUSTRALIA) PTY LTD (ADMINISTRATORS APPOINTED) (ADMINISTRATORS APPOINTED)

Directions

Strike out whichever is inapplicable.

(1) Insert date of Court Order in winding up by the Court, or date of resolution to wind up, if a voluntary winding up.

(2) Insert full name and address (including ABN) of the creditor and, if applicable, the creditor's partners. If prepared by an employee or agent of the creditor, also insert a description of the occupation of the creditor.

(3) Under "Consideration" state how the debt arose, for example "goods sold and delivered to the company between the dates of Exchange".

", "moneys advanced in respect of the Bill of

(4) Under "Remarks" include details of vouchers substantiating payment.

(5) Insert particulars of all securities held. Where the securities are on the property of the company, assess the value of those securities. If any bills or other negotiable securities are held, specify them in a schedule in the following form:

Date Drawer Acceptor Amount Date Due

$ $

(6) If proof is made by the creditor personally, strike the two (2) paragraphs numbered 3.

Annexures

A. If space provided for a particular purpose in a form is insufficient to contain all the required information in relation to a particular item, the information must be set out in an annexure.

B. An annexure to a form must:

(a) have an identifying mark;

(b) and be endorsed with the words:

i) "This is the annexure of (insert number of pages) pages marked (insert an identifying mark) referred to in the (insert description of form) signed by me/us and dated (insert date of signing): and

(c) be signed by each person signing the form to which the document is annexed.

The pages in an annexure must be numbered consecutively. C.

D. If a form has a document annexed the following particulars of the annexure must be written on the form:

(a) the identifying mark; and

(b) the number of pages.

A reference to an annexure includes a document that is with a form.

y >...bridesmaid dresses. on 14 july 2017, the us based holding company, alfred angelo newco, inc...

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