Notice to debenture holders of Arcay Group Limited ("Arcay")
It has come to the notice of Edward Nathan & Friedland (Proprietary)
Limited, the trustee for the debenture holders, that the directors of Arcay
have, without informing the trustee sent a notification to debenture holders
dated 5 February 2002 ("the notice"). In that notice the directors of Arcay
intimated (despite a public undertaking by its CEO, Mr. Kevin de Villiers,
that Arcay would fund the expenses of the debenture holders if it were
legally bound to do so) that:
1. it would not fund these expenses and the debenture holders would have to
fund them themselves;
2. as the dispute was considered frivolous, Arcay would seek a costs order
"against the Trustee, as representative of the debenture holders";
3. Arcay will not pay interest due to the debenture holders on due date if
they exercise their legal rights (as they are entitled to do in the opinion
of the trustee).
The trustee has been advised and believes that the conduct of Arcay has
resulted in the debentures becoming immediately due and payable in terms of
the debenture trust deed and that Arcay is legally liable to fund the costs
of any action by the debenture holders. Arcay's further threat referred to
in paragraph 3 above in the opinion of the trustee constitutes a further
breach by Arcay.
Debenture holders who have lodged proxies on the basis of the notice should
reconsider their position in the light of the above. Debenture holders are
urged to make every effort to attend the meeting on 20 February 2002 when
the full text of the legal advice received by the trustee will be available.
14 February 2002
Trustee for debenture holders
Edward Nathan & Friedland
Corporate Law Advisers & Consultants
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