Joint liquidators’ third progress report from 29 May 2016 ... · Recovery Limited, Tower 12,...

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Joint liquidators’ third progress report from 29 May 2016 to 28 May 2017

WXYZ Corporation Limited (formerly Astracast Limited)

(in Creditors’ Voluntary Liquidation)

19 July 2017

http://www.pwc.co.uk/

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WXYZ Corporation Limited (formerly Astracast Limited) PwC

Contents

Abbreviations and definitions 2

Key messages 4

Progress in the period 5

Outcome for creditors 9

Appendix A: Receipts and payments 11

Appendix B: Expenses 14

Appendix C: Remuneration update 16

Appendix D: Other information 20


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The following table shows the abbreviations and insolvency terms that may be used in this report:

Abbreviation or definition Meaning

Company WXYZ Corporation Limited (formerly Astracast Limited)

Liquidators

we

our

Lyn Leon Vardy and Toby Scott Underwood of

PricewaterhouseCoopers LLP, Central Square, 29 Wellington Street,

Leeds, LS1 4DL

firm PricewaterhouseCoopers LLP

IR16 Insolvency (England and Wales) Rules 2016

IA86 Insolvency Act 1986

Birstall

Bradford together “the

Properties”

NUL

Unit 1, Holden Ing Way, Birstall, West Yorkshire, WF17 9AE (title

numbers WYK423063, WYK423980 and WYK590022)

Roydsdale Way, Euroway Trading Estate, Bradford, West Yorkshire,

BD4 6SE (title numbers WYK214956 and WYK158634)

Newcastle under Lyme, Staffordshire, ST5 6EL (title number

SF151966)

CVL Creditors’ voluntary liquidation

Demlin Demlin Investments Limited

HLD HLD Capital Limited

HMRC HM Revenue & Customs

Jacuzzi UK Jacuzzi UK Group Plc

PPF The Pension Protection Fund

prescribed part The amount set aside for unsecured creditors from floating charge

funds in accordance with Section 176A IA86 and the Insolvency Act

1986 (Prescribed Part) Order 2003

Proposals The Administrators Proposals for achieving the purpose of

Administration

Ramfield Ramfield Limited (formerly Ramfield plc)

SPA Sale and purchase agreement for the sale of the business and assets of

Astracast Limited dated 7 February 2014

Abbreviations and definitions


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the Administration The administration of WXYZ which commenced on 7 February 2014

and ended on 28 May 2014

the Administrators John Titley, Julien Irving and Conrad Beighton of Leonard Curtis

Recovery Limited, Tower 12, 18/22 Bridge Street, Spinningfields,

Manchester, M3 3BZ

the Astracast Facility 21 Roydsdale Way, Euroway Trading Estate, Bradford, West Yorkshire,

BD4 6SE (title number WYK658825)

the Landlord Legal & General Property Limited

the Pension Scheme The Jacuzzi UK Retirement Benefit Scheme

the Purchaser Astracast Limited (formerly known as Ashworth Global Pipe Systems

Limited)

the Receivers Richard Roe and Anthony Spencer of Eddisons Commercial Limited

and Mark Swiers and Michael Daniel Worsley Hardy of Sanderson

Weatherall LLP appointed as Receivers over the Properties

the Trustees The Trustees of The Jacuzzi UK Retirement Benefit Scheme

USI USI Overseas Holding Limited – In Liquidation

secured creditors Creditors with security in respect of their debt, in accordance with

Section 248 IA86

preferential creditors Generally, claims for unpaid wages earned in the four months before

the insolvency up to £800, holiday pay and unpaid pension

contributions in certain circumstances

RPS Redundancy Payments Service, an executive agency sponsored by the

Department for Business, Energy and Industrial Strategy, which

authorises and pays the statutory claims of employees of insolvent

companies under the Employment Rights Act 1996

unsecured creditors Creditors who are neither secured nor preferential


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Why we’ve sent you this report I’m writing to update you on the progress of the liquidation of the Company in the 12 months since our last report dated 22 July 2016.

You can still view our earlier reports on our website at www.pwc.co.uk/wxyz.

How much creditors may receive The following table summarises the possible outcome for preferential and unsecured creditors*, based on what we currently know. Later in this report we explain what recoveries the secured creditors are expected to make from assets subject to the security granted in their favour by the Company.

Class of creditor

Current estimate

(p in £)

Previous estimate

(p in £)

Preferential creditors N/A N/A

Unsecured creditors 0.14** Between 0.013 and 2.085

*Please note this guidance on dividends is only an indication and should not be used as the main basis of any bad debt provision or debt

trading.

**Our previous dividend estimate took into account various outcomes that may occur as a result of our application for directions, to

determine the extent of any cap on the security over the Properties (as discussed later in this report). Our current estimate of 0.14 is

based on the Prescribed Part fund, which has been set aside from the previous administration, and the figure stated in the Statement of

Affairs for unsecured creditor claims. Please see our receipts and payments account at Appendix A for further information in relation to

the current dividend estimate.

For the purposes of this report and until the matters regarding the extent of security entitlements have been resolved, we have assumed

that only a prescribed part fund will be available for creditors.

What you need to do We continue to ask for outstanding claims from unsecured creditors so that we can agree them for dividend purposes.

If you haven’t already done so, please send your claim to us so that we can agree it. A claim form can be downloaded from our website at www.pwc.co.uk/wxyz or you can get one by telephoning James Crowther on 0113 289 4076.

Creditors who are owed £1,000 or less by the Company don’t need to submit claim documentation (unless specifically asked) to take part in the anticipated dividend.

Key messages


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This is our third progress report. You may wish to refer to our previous reports which can be found at: www.pwc.co.uk/wxyz.

When we last reported, the key outstanding matters in the liquidation were as follows:

To obtain court directions to clarify the position in relation to the potential cap on the security over the Birstall and Bradford properties; and

Agreement of creditor claims and payment of a dividend under the prescribed part.

Realisation of assets – assets specifically pledged to a creditor

The Properties

We understand the legal title to the Properties vested in Ramfield (part of the same group of companies as WXYZ) but that WXYZ holds the beneficial title to the Properties, and therefore may be entitled to any surplus sales proceeds over and above any charges registered against the Properties.

On 9 February 2007, both Ramfield and WXYZ granted security over the Properties to the Pension Scheme. The Pension Scheme liability is estimated to be c.£90 million. On 13 April 2015, the PPF issued a transfer notice under Section 160 of the Pensions Act 2004 in respect of the Pension Scheme. The consequence of the issue of the transfer notice is that the PPF took on the Pension Scheme and the Trustees were discharged from their pension obligations.

Appointment of the Receivers (background information)

As detailed in our previous reports, on 18 June 2014 the Trustees appointed Receivers over the Properties, to act as managing agents and to market and sell the Properties on their behalf.

The sale of Birstall completed on 6 February 2015 for £3.8 million. All sales proceeds, following the deduction of the Receivers costs, were distributed to the PPF. This amounted to £3,528,358.

The sale of NUL completed on 17 July 2015 for £950,000. All sales proceeds, again following the deduction of the Receivers’ costs, were distributed to the PPF.

The sale of Bradford completed on 18 December 2015 for £2.5 million. Of this, £660,409 has been paid to the PPF (£322,940 sale proceeds and £337,469 in rental income). The rest of the funds, following deduction of costs, were transferred to a solicitors’ escrow account pending the court’s decision on the potential cap on the security over Birstall and Bradford. The escrow funds have recently been transferred to a bank account operated by us, as it attracts a higher rate of interest.

Potential cap on the security over Birstall and Bradford

As reported previously, on appointment we were made aware of correspondence which suggested that the security over the properties at Birstall and Bradford was capped at £4 million. This is a position which the PPF disputes. It should be noted that there is no such cap in relation to the NUL property.

If there is a cap on the PPF’s security, any proceeds of sale over and above £4 million (after reasonable costs of sale) may be payable to the Company as beneficial owner.

Following the receipt of legal advice, we sought counsel’s opinion in order to ascertain whether it would be in the interests of the creditors to make an application to court for directions. Advice from counsel confirmed that the only conclusive way to ascertain whether a security cap exists was to apply to court for directions.

Progress in the period


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We are seeking the court’s directions on:

a) How should the Liquidators determine in what proportions any amounts realised from the proceeds and rental income from the Properties should be allocated between the parties;

b) Is there an effective cap on the amount of the Pension Scheme’s / PPF's entitlement;

c) If there is an effective cap, is the rental income which the Pension Scheme / the PPF have received to date (and/or could have received following the sale of Bradford) to be included in the calculation of the Pension Scheme / the PPF's entitlement (to which the cap applies); and

d) Are the Trustees / PPF entitled only to the sum of £4,000,000 from the proceeds of sale, so that they must turn over all the rental income received pursuant to the security?

In the interest of saving costs, it was originally intended that we would make an application for directions, and that we would present the court with the relevant facts and arguments for and against the cap. As respondents to our application, the PPF, Demlin and the Trustees would be bound by the court’s decision.

During the reporting period, we have spent a significant amount of time liaising with both the PPF and Demlin, and their respective lawyers, in order to progress and finalise the documentation for our application. Counsel’s opinion has been obtained at various stages in relation to the documents that will accompany our application. We are hoping to reach agreement with the respondents, upon the content of our application (including our witness evidence and skeleton argument), in the very near future.

We previously advised creditors that the PPF had agreed to fund the court application to determine the security cap position. The terms of our agreement have recently been called into question and we are in discussions with the PPF to agree the funding position, in order to enable the court application to proceed (as there are insufficient asset realisations in the liquidation estate to fund the application).

Realisation of assets – assets not specifically pledged

Intercompany debtors

We previously informed creditors that we had been unable to acquire any information in relation to the Company’s inter-company debtors, and therefore we would be reliant on the information provided in the directors’ statement of affairs in the Administration (estimated to realise value of nil).

Since our last report, we have been in correspondence with Grant Thornton UK LLP who are Liquidators of USI, one of the Company’s debtors. We understand that the Company has a claim in the liquidation of USI by way of an intercompany loan, for which a proof of debt form has recently been submitted (following notification of a pending dividend).

The Liquidators of USI have suggested that, despite USI noting on their statement of affairs that it owes the Company £21,744,237, the Company’s debt may have been waived. We are liaising with the liquidators of USI to establish the facts surrounding the waiver, and the basis upon which this was effected.

Interest Received

We have received bank interest of £267.66 for the period of this report.


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Statutory and compliance

Tax matters

The Company’s tax year end is 28 May and the tax computation for the year ended 28 May 2016 was finalised in this period. This generated a tax liability of £53,795 that was paid in the reporting period, principally in relation to rental income received by the Receivers.

VAT matters

We have prepared and submitted a final VAT return for the period 1 April 2016 to 16 June 2016. There is final VAT repayment of £3,433 due to the Company that currently remains outstanding.

Change of liquidator Stephen Ellis, one of the previous joint liquidators, has retired from the firm. To make sure that outstanding issues in the liquidation continue to be pursued, an application was made to Court to remove him and appoint Lyn Vardy as Liquidator. Lyn Vardy is licensed in the United Kingdom to act as an insolvency practitioner by the Institute of Chartered Accountants in England and Wales.

The application was granted and so Lyn Vardy replaced Stephen Ellis as Liquidator with effect from 8 March 2017. Stephen Ellis was released from all liability in respect of his conduct as Liquidator with effect from 28 days from 8 March 2017 (being the date that the Court Order was advertised in the London Gazette).

Investigations and actions Nothing has come to our attention during the period under review to suggest that we need to do any more work in line with our duties under the Company Directors’ Disqualification Act 1986 and Statement of Insolvency Practice No.2.

Our receipts and payments account We set out in Appendix A an account of our receipts and payments in the liquidation from 29 May 2016 to 28 May 2017.

Our expenses We set out in Appendix B a statement of the expenses we’ve incurred to the date covered by this report and an estimate of our future expenses.

The statement excludes any potential tax liabilities that we may need to pay as a liquidation expense in due course because amounts due will depend on the position at the end of the tax accounting period.

Our fees We set out in Appendix C an update on our fees, disbursements and other related matters.

Creditors’ rights Creditors have the right to ask for more information within 21 days of receiving this report as set out in Rule 18.9 IR86. Any request must be in writing. Creditors can also challenge our fees and expenses within eight weeks of receiving this report as set out in Rule 18.34 IR86. This information can also be found in the guide to fees at:

http://www.icaew.com/-/media/corporate/files/technical/insolvency/creditors-guides/2017/liquidations-creditor-fee-guide-6-april-2017.ashx?la=en

You can also get a copy free of charge by telephoning Andy Lilley on 0113 289 4153.


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What we still need to do

The following is a summary of key issues remaining:

Obtain court directions to clarify the position in relation to the potential cap on the security over the Birstall and Bradford properties;

Seek to approve the basis of the liquidators’ remuneration from the general body of creditors, once a decision has been made by the court in relation to the security position;

Settlement of outstanding professional fees and expenses;

Agreement of creditor claims and payment of a dividend under the prescribed part; and

Finalise statutory and compliance matters such as tax returns (and clearance), creditor reports and closure of internal systems.


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Outcome for creditors

Secured creditors

The PPF

The Pension Scheme holds a legal charge over the Properties by way of a debenture entered into on 9 February 2007. As at 13 April 2015, the security held by the Pension Scheme formally transferred to the PPF.

As previously stated, the Pension Scheme liability is estimated to be in the region of c. £90 million, albeit no formal claim has yet been received. Current and potential future distributions received by the PPF from the sale of the Properties would be insufficient to settle this balance in full, whether a cap is found to be in place or not. Any amounts owing over and above the security will be an unsecured claim in the Liquidation.

As discussed in previous reports, it has been the responsibility of the Receivers to remit any sales proceeds due to the PPF under their security, subject to the ongoing investigation in relation to whether this security over Birstall and Bradford was historically capped at £4 million.

It is understood that the security granted over NUL is not subject to any cap and therefore all proceeds of sale have been remitted directly to the PPF.

To date the PPF has received £4,333,559 in relation to Birstall and Bradford and rental income relating to the Properties, and £1,029,276 in relation to NUL, as detailed in the table below:

Property Sales proceeds £ Rental income £

Receivers costs deducted £

Amount held in escrow (inc. interest) £

Amount distributed £

Birstall 3,800,000 144,792 271,642 - 3,673,150

Bradford 2,500,000 322,940 74,755 2,112,717 660,409

NUL 950,000 127,380 48,104 - 1,029,276

Total 7,250,000 595,112 394,501 2,112,717 5,362,835

Demlin

It is understood that Demlin holds a fixed and floating charge over the Company’s assets. During the previous Administration Demlin received distributions totalling £375,000 under their fixed charge and £577,000 under their floating charge. We are yet to ascertain the remaining amount Demlin is seeking to claim under its security. We therefore cannot comment further regarding the level of any future distributions due to Demlin.

Preferential creditors (mainly employees)

The Company has no known preferential creditors.

Unsecured creditors

As per the directors’ statement of affairs, unsecured creditor claims are estimated to total c.£1.04 million. Only a handful of unsecured claims have been received by us to date.

The Prescribed Part is a fund that has to be made available for unsecured creditors. It’s paid out of “net property”. Net property is floating charge realisations after costs, and after paying - or setting aside enough to pay - preferential creditors in full. But it only has to be made available where the floating charge was created on or after 15 September 2003.


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We believe that the Prescribed Part applies in this case as Demlin’s floating charge was created and registered at Companies House after 15 September 2003.

The amount of the Prescribed Part is:

– - 50% of net property up to £10,000; – - 20% of net property above £10,000; and – - Subject to a maximum of £600,000.

We continue to think that, based on Administration related realisations and expenses, the Company’s net property will be £720,895 which means the estimated value of the Prescribed Part is £147,179. The estimated dividend percentages provided earlier in the report are subject to change, as a result of : – Future asset realisations; – The outcome of the court hearing; and – The final level of claims received from unsecured creditors.

You shouldn’t use our dividend estimate as the main basis for any bad debt provisions.

Apart from any Prescribed Part, there may be surplus funds to allow a dividend for unsecured creditors. More information on this will be available following the outcome of the court hearing.

Next report We expect to send our next report to creditors at the end of the liquidation or in about 12 months, whichever is the sooner.

If you’ve got any questions, please get in touch with Andy Lilley, on 0113 289 4153.

Yours faithfully Lyn Vardy Joint liquidator Lyn Leon Vardy and Toby Scott Underwood have been appointed as joint liquidators of the Company. Both are licensed in the United Kingdom to act as an Insolvency Practitioner by the Institute of Chartered Accountants in England and Wales.

The joint liquidators are bound by the Insolvency Code of Ethics which can be found at: https://www.gov.uk/government/publications/insolvency-practitioner-code-of-ethics.

The joint liquidators are Data Controllers of personal data as defined by the Data Protection Act 1998. PricewaterhouseCoopers LLP will

act as Data Processor on their instructions. Personal data will be kept secure and processed only for matters relating to the liquidation.


https://www.gov.uk/government/publications/insolvency-practitioner-code-of-ethics

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WXYZ Corporation Lim ited - in creditors' voluntary liquidation

Sum m ary of financial inform ation as at 28 May 2017

T otal for the

period from

appointm ent to

28 May 2016

T otal for the

period from 29

May 2016 to 28

May 2017

T otal Estim ated

outcom e

Notes

£ £ £ £

Fixed charge receipts and pay m ents account - PPF

Fixed charge receipts

Balance from Administrators - rental income 95,147 .7 9 - 95,147 .7 9 95,147 .7 9 1

Balance from Administrators - rent deposit NUL 7 2,07 6.08 - 7 2,07 6.08 7 2,07 6.08

Surplus from sale of the Properties - Uncertain

167 ,223.87 - 167 ,223.87 Uncertain

Fixed charge paym ents - PPF

Third party funds rent deposit - Newcastle under Ly me (7 2,07 6.08) - (7 2,07 6.08) (7 2,07 6.08)

Balance from Administrators - rental income - - - Uncertain

Liquidation insurance costs - properties (587 .50) - (587 .50) (587 .50)

Liquidators' fees - - - Uncertain

Liquidators' disbursements - - - Uncertain

(7 2,663.58) 0.00 (7 2,663.58) Uncertain

FUNDS IN HAND 94,560.29 0.00 94,560.29 -

Fixed charge receipts and pay m ents - Dem lin

Fixed charge receipts

Balance from Administrators 25,000.00 - 25,000.00 25,000.00

25,000.00 - 25,000.00 25,000.00

Fixed charge paym ents

Administration costs - agents' fees (12,000.00) - (12,000.00) (12,000.00)

(12,000.00) - (12,000.00) (12,000.00)

FUNDS IN HAND 13,000.00 0.00 13,000.00 13,000.00

Appendix A: Receipts and payments


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Floating charge receipts and payments account

Floating charge receipts

Balance from Administrators 95,223.03 - 95,223.03 95,223.03

Balance from Administrators' licence fee Astracast facility 212,500.00 - 212,500.00 212,500.00

Sales of business - deferred consideration 323,834.00 - 323,834.00 323,834.00

Sale of business - earn out consideration - - - -

Tax losses 126,450.32 - 126,450.32 126,450.32

Tax Losses - contribution towards costs 8,360.18 - 8,360.18 8,360.18

VAT duty deferment refund 20,774.62 - 20,774.62 20,774.62

Inter company debtors - - - -

Interest received 743.01 267.66 1,010.67 1,010.67

787,885.16 267.66 788,152.82 788,152.82

Floating charge payments

Bank charges (21.00) - (21.00) (21.00)

Third party funds - licence fee (212,500.00) - (212,500.00) (212,500.00)

Administration related VAT pament to HMRC (49,654.54) - (49,654.54) (49,654.54)

Administrators' pre-appointment fees (62,874.07) - (62,874.07) (62,874.07)

Pre-Administration costs - legal fees and expenses (31,864.05) - (31,864.05) (31,864.05)

Pre-Administration costs - agents' fees and expenses (20,000.00) - (20,000.00) (20,000.00)

Statutory advertising (75.82) - (75.82) (75.82)

Administrators' post appointment fees (74,166.67) - (74,166.67) (74,166.67)Administration related post appointment legal fees and expenses (23,098.67) - (23,098.67) (23,098.67)

Administration related post appointment agents' fees and

expenses (18,008.33) - (18,008.33) (18,008.33)

Liquidators' pre appointment fees - - - Uncertain 2

Liquidators' pre appointment disbursements - - - Uncertain 2

Legal fees - contribution to costs/sale of tax losses (4,180.09) - (4,180.09) (4,180.09)

Legal fees and expenses (Liquidation related) (14,096.33) (8,892.00) (22,988.33) Uncertain 2

Irrecoverable VAT - (1,778.40) (1,778.40) (1,778.40)

(510,539.57) (10,670.40) (521,209.97) Uncertain

FUNDS IN HAND 277,345.59 (10,402.74) 266,942.85 Uncertain

Preferential creditors - - - N/A

VAT control account 62.22 0.00 62.22 62.22

Net property 384,968.10 10,402.74- 374,565.36 720,896.30

Prescribed Part (for unsecured creditors) - - - (147,179.00) 3

Unsecured creditors (as per the Statement of Affairs) - - - 104,321,123.00 4

Estimated dividend to unsecured creditors - - - 0.14 5

Cash at bank 384,968.10 (10,402.74) 374,565.36 -

*All figures are stated as exclusive of VAT.

* Funds are held in a Barclays interest bearing account. The interest rate applicable to the account is 0.100%


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Notes

1. We will hold the rental income until the court application has been made. We are requesting directions from the

court in relation to the rental income held and whether the potential cap of £4 million also covers the rental

income from the Properties.

2. As the basis of our fees and expenses has not yet been approved by the general body of creditors, and the final level

of realisations into the Liquidation are uncertain, no estimate of these fees and expenses can be provided at this

time.

3. Due to uncertainty around the final level of realisations in the Liquidation, the estimated Prescribed Part available

for unsecured creditors has been calculated based solely on the amount ring fenced for creditors at the end of the

Administration.

4. The unsecured creditors figure is based on the figure within the directors’ statement of affairs.

The dividend estimate is based on the prescribed part ring fenced at the end of the Administration and the value of

unsecured creditor claims as per the directors’ statement of affairs. The ultimate dividend will depend upon various

matters, including (but not limited to) the outcome of the court application, the validity of any other secured

charges, the costs and expenses of the liquidation estate, any re-calculation of the prescribed part in the liquidation

and the final level of creditor claims agreed.

More information will be provided to creditors in due course.

5. Directors’ statement of affairs values have not been provided as due to a number of the asset realisations taking

place in the former administration, these figures are not comparative with Liquidation realisations.


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The following table provides details of our expenses. Expenses are amounts properly payable by us as liquidators from the estate. It does not include distributions to creditors. Whilst the term ‘expense’ does include our fees, as the basis of our remuneration hasn’t been approved, we haven’t included an amount for our fees in the table below.

The table should be read in conjunction with the receipts and payments account at Appendix A, which shows expenses actually paid during the period and the total paid to date.

Brought

forward from

preceding

period £

Unpaid

expenses as

at 28 May

2016 £

Incurred in

the period

under

review £

Paid in

the period

under

review £

Unpaid

expenses as

at 28 May

2017 £

Cumulative

£

Estimated

future £

Anticipated

total £

Administration

costs – agents’

fees

12,000.00 - - - - 12,000.00 - 12,000.00

Administrators’

pre appointment

fees

62,874.07 - - - - 62,874.07 - 62,874.07

Administrators’

pre appointment

legal fees

31,864.05 - - - - 31,864.05 - 31,864.05

Administrators’

pre appointment

agents’ fees

20,000.00 - - - - 20,000.00 - 20,000.00

Administrators’

post appointment

fees

74,166.67 - - - - 74,166.67 - 74,166.67

Administrators’

post appointment

legal fees

23,098.67 - - - - 23,098.67 - 23,098.67

Administrators’

post appointment

agents’ fees

18,088.03 - - - - 18,088.03 - 18,088.03

Legal fees –

Eversheds LLP

24,270.00 10,173.67 - 8,892.00 1,281.67 24,270.00 - 24,270.00

Legal fees –

Walker Morris

LLP

4,916.00 4,916.00 30,568.00 - 35,484.00 35,484.00 15,000.00 50,484.00

Counsel Fees - - 6,400.00 - 6,400.00 6,400.00 8,600.00 15,000.00

Insurance 587.50 - - - - 587.50 - 587.50

Storage costs 190.96 190.96 36.00 - 226.96 226.96 250.00 476.96

Bonding 225.00 225.00 10.00 - 235.00 235.00 200.00 435.00

Postage/courier 551.28 551.28 - - 551.28 551.28 500.00 1,051.28

Search fees 190.50 190.50 - - 190.50 190.50 - 190.50

Travel costs (excl

mileage)

48.40 48.40 - - 48.40 48.40 - 48.40

Legal Fees –

Transfer of

Appointment

- - 378.00 - 378.00 378.00 - 378.00

Appendix B: Expenses


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Photocopying 55.53 55.53 37.00 - 92.53 92.53 90.00 182.53

Irrecoverable VAT - - 1,778.40 1,778.40 - 1,778.40 - 1,778.40

Bank charges 21.00 - - - - 21.00 100.00 121.00

Statutory

advertising

75.82 - - - - 75.82 220.00 295.82

Legal fees –

contribution to

costs/sale of tax

losses

4,180.09 - - - - 4,180.09 - 4,180.09

Corporation Tax

liability for

financial year

15/16

- - 53,795.40 - 53,795.40 53,795.40 - 53,795.40

Total 277,403.57 16,351.34 93,002.80 10,670.40 98,683.74 370,406.37 24,960.00 395,366.37


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Background

The basis of our fees is yet to be determined in this case.

No fees can be drawn until our remuneration basis has been approved by creditors.

We will seek to approve the basis of our remuneration from the general body of creditors once we have established the extent of the PPF’s security over the Properties.

Narrative of key areas of work carried out for the period 29 May 2016 to 28 May 2017

There remain a number of distinct work streams within the work we have done. It should be noted that individuals will have worked in more than one area. The activities of these work streams are summarised below:

Area of work Work undertaken

Why the work was

necessary

What, if any, financial

benefit the work

provided to creditors OR

whether it was required

by statute

Accounting & treasury Regular bank

reconciliations.

Arrangement of new bank

account to hold Escrow

funds pending receipt of

Court directions.

To manage the Company’s

bank accounts.

Ensures proper financial

control of cash.

Required by statute and

regulations.

Creditors Dealing with creditor

correspondence and

requests for updates.

To keep creditors informed

on the progress of the case.

Work is required by statute

and for the proper

administration of the case.

Freehold Property/Potential

cap on the sales of the

Properties

Meetings with solicitors in

relation to this matter.

Review of

information/evidence on

file.

Communications with

Respondents to

progress/finalise Skeleton

Argument and Witness

Statement.

Consideration of counsel’s

opinion on the

Respondents’

comments/proposed

amendments to our

application.

To determine whether the

Property sales proceeds

over and above £4 million

should form part of the

Liquidation estate.

If the court determines that

the cap is valid then the

sale proceeds in excess of

£4 million will be

transferred for the benefit

of the unsecured creditors.

Strategy & planning Budgets and cost

monitoring.

For the proper

management of the case.

Controls time costs and

ensures efficient case

progression.

Appendix C: Remuneration update


www.pwc.co.uk/wxyz


Cash flow monitoring.

Updates and progression

meetings.

Statutory & compliance Internal compliance

procedures.

Circulation and

preparation of the second

annual report for the

Liquidation.

Appointee and manager

case reviews.

Case data maintenance

and filing.

To comply with mandatory

statutory and other

obligations.

Required by

statute/regulations.

Tax and VAT Submitting the final VAT

return to HMRC.

Complying with the

Company’s tax obligations

including submission of

annual returns.

To comply with legal

requirements.

Required by statute or

other legal requirement.

Ensures any available tax

and VAT recoveries are

made for the benefit of the

Liquidation.

Our future work We still need to do the following work in the liquidation.

Area of work Work we need to do

Whether or not the work will

provide a financial benefit to

creditors

Strategy & planning Budgets and cost monitoring.

Cash flow monitoring.

Updates and progression meetings.

Controls efficiencies, time costs

and ensures continued case

progression towards closure.

Assets Liaising with the Liquidators of USI in

relation to an inter-company debtor.

Future asset realisations will

improve the dividend position

for Company creditors.

Accounting & treasury Bank reconciliations.

Accounting for receipts/payments.

Dividend payment.

Payment of professional fees.

Dealing with unclaimed dividend cheques.

Account closure procedures.

Ensures proper financial control

of cash.

Required by statute and

regulations.


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Secured & unsecured creditors Liaising with secured creditor regarding

claim finalisation.

Calculating the outcome of the liquidation so

as to determine the availability of any

dividend and announcing any declaration to

creditors.

Preparing and distributing any available

funds to unsecured creditors.

Dealing with ad hoc creditor enquiries.

Distribution of funds to

respective category of creditor

as required by statute.

Freehold Property/Potential cap on

the sales of the Properties Correspondence/meetings with solicitors in

relation to this matter.

Resolution of the fees position to establish

how the application to court for directions is

being funded.

Communications with Respondents to finalise

Skeleton Argument and Witness Statement.

Review of counsel’s opinion on revised

documentation.

Essential for the progress of the

case.

Statutory & compliance Internal compliance procedures.

Periodic manager and appointee reviews as

required by regulatory body.

Drafting and sending out this progress report

to creditors.

Drafting and sending out the final report to

creditors.

Updating case records.

Internal case progression reviews.

Case closure e.g. systems/files.

Reviewing appointee’s bonding.

Required by statute.

Tax & VAT Complying with the Company’s tax

obligations and submission of statutory

returns.

Submission of VAT426 form to recover VAT,

post de-registration.

Final reconciliation of VAT control account.

Required by statute.


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Disbursements We don’t need to get approval to draw expenses or disbursements unless they are for shared or allocated services provided by our own firm, including room hire, document storage, photocopying, communication facilities. These types of expenses are called “Category 2” disbursements and they must be directly incurred on the case, subject to a reasonable method of calculation and allocation and approved by the same party who approves our fees.

Our expenses policy allows for all properly incurred expenses to be recharged to the liquidation. The policy for recovering Category 2 disbursements requires creditor approval which has currently not been obtained.

The following disbursements arose in the period of this report.

Category Policy

Costs

incurred

£

2 Photocopying - at 5 pence per sheet copied, only charged for circulars to

creditors and other bulk copying. 37.00

2 Mileage - At a maximum of 71 pence per mile (up to 2,000cc) or 93 pence per

mile (over 2,000cc) Nil

1

All other disbursements reimbursed at cost

Storage costs

Bonding

Legal Fees – Transfer of appointment (approved by Court)

36.00

10.00

378.00

Total 461.00

Legal and other professional firms We’ve instructed the following professionals on this case:

Service provided

Name of firm /

organisation

Reason selected Basis of fees

Legal advice and expertise Eversheds LLP Expertise and

knowledge

Time cost basis

Legal advice and expertise Walker Morris LLP Expertise and

knowledge

Time cost basis

Our choice was based on the advisers’ experience, the complexity and type of work and the basis of the fee arrangement. We’re satisfied that the fees charged are reasonable.


www.pwc.co.uk/wxyz


Company’s registered name: WXYZ Corporation Limited (formerly Astracast Limited)

Trading name: WXYZ Corporation Limited

Registered number: 01455007

Registered address: C/o PricewaterhouseCoopers LLP, Central Square, 29 Wellington

Street, Leeds, LS1 4DL

Date of the Liquidators’ appointment: 29 May 2014

Liquidators’ names, addresses and

contact details:

Lyn Leon Vardy and Toby Scott Underwood of Pricewaterhouse

Coopers LLP, Central Square, 29 Wellington Street, Leeds, LS1 4DL

[email protected] or [email protected]

Details of prior administration J Irving, C Beighton and J M Titley of Leonard Curtis were appointed

as joint administrators on 7 February 2014

Estimated dividend for preferential

creditors

N/A

Estimated dividend for unsecured

creditors

Uncertain

Estimated value of the Company’s net

property and Prescribed Part

Net Property: £720,895

Prescribed Part: £147,179

The European Regulation on

Insolvency Proceedings (Council

Regulation(EC) No. 1346/2000 of 29

May 2000):

These proceedings are main proceedings

Appendix D: Other information


mailto:[email protected]

Joint liquidators’ third progress report from 29 May 2016 ... · Recovery Limited, Tower 12,...

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