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Bestjet Travel Pty Ltd (Administrators Appointed)

ACN 155 965 601 Formerly Trading as “Bestjet.com”

(the “Company”)

Report to Creditors Pursuant to Section 75-225 of the

Insolvency Practice Rules (Corporations) 2016

Appointee(s):

Mr Nigel Robert Markey Mr Bradley Vincent Hellen

Pilot Partners

Contact: Mr Ben Stubbings Mr Andy Nguyen

BestJetGroup@pilotpartners.com.au

Date: 22nd day of January 2019

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Contents

1. SUMMARY 3

2. MEETING OF CREDITORS 6

3. ADMINISTRATORS’ RECOMMENDATION 8

4. LIKELY RETURN TO CREDITORS 10

5. COMPANY INFORMATION 12

6. RECOVERABLE TRANSACTIONS 32

7. OFFENCES AND INSOLVENT TRADING 34

8. GENERAL CUSTOMER INFORMATION 37

9. COSTS OF THE ADMINISTRATION 39

10. WHAT HAPPENS NEXT? 40

Appendices Document Description

A Notice of Meeting of Creditors B Proof of Debt (Form 535) C Proxy Form D DIRRI E Estimated Statement of Position

F ARITA Information Sheet which provides a summary of offences, recoverable transactions and insolvent trading

G Remuneration Approval Report

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Glossary

Glossary of Terms

Abbreviation Description Act Corporations Act 2001 AFTA Australian Federation of Travel Agents

ARITA Australian Restructuring Insolvency and Turnaround Association

ASIC Australian Securities and Investments Commission ATAS AFTA Travel Accreditation Scheme AWS Amazon Web Services Bestjet Singapore Bestjet Travel Pte Ltd Brooklyn Brooklyn Travel Pty Ltd (Administrators Appointed) BSP Billing and Settlement Plan

Company Bestjet Travel Pty Ltd (Administrators Appointed) Formerly Trading as "Bestjet.com"

CVFR Travcom International Group Pty Ltd trading as CVFR Travel Group

DIRRI Declaration of Independence, Relevant Relationships and Indemnities

DOCA Deed of Company Arrangement FEG Fair Entitlements Guarantee Scheme GDS Global Distribution System IATA International Air Transport Association IPR Insolvency Practice Rules (Corporations) 2016 Mr McVicker Mr Robert Bruce McVicker (DOB: 8 December 1973) NAB National Australia Bank Limited NSA Nexia Sydney Audit Pty Ltd OtAlab OTAlab Pte Ltd OTAlab CSS OTAlab Customer Support Services PPSR Personal Property Securities Register Proof of Debt Form Formal Proof of Debt or Claim Form ROCAP Report on Company Activities and Property Sabre Sabre Asia Pacific Pte Ltd

Wynyard Wynyard Travel Pty Ltd (Administrators Appointed) Formerly Trading as "Harvey World Barrack Street"

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Section | ONE

1. SUMMARY 1.1 We were appointed Administrators of Bestjet Travel Pty Ltd (Administrators Appointed)

(“the Company”) on 18 December 2018. Further to our Initial Report to Creditors dated 20 December 2018 and the first meeting of creditors of the Company held on 2 January 2019, we now report to creditors in accordance with Section 75-225 of the Insolvency Practice Rules (Corporations) 2016.

1.2 The purpose of this report is to explain the position of the Company, advise the creditors of the results of our investigations to date, and to provide our opinion as to what future course of action would be in the best interests of creditors.

1.3 The Company was part of the Bestjet Travel Group and is ultimately owned by McVicker International Pty Ltd as trustee for both the McVicker International Trust and Rachel James. We believe from our investigations that 50% of the Company’s shares are held by McVicker International Pty Ltd as trustee for the McVicker International Trust and 50% by it as trustee for Ms James. We were also appointed Voluntary Administrators to Wynyard Travel Pty Ltd and Brooklyn Travel Pty Ltd, each of whom is also a company within the Bestjet Travel Group. There are two other companies which are, or may also be, companies within the Bestjet Travel Group, being Bestjet Travel Pte Ltd and OTAlab Pte Ltd. Both are companies incorporated in Singapore. We have not been appointed as administrators or liquidators to either company and therefore do not exercise any control over them.

1.4 For the reasons set out in our report, we believe that it is in the best interests of creditors that the Company be wound up.

1.5 The estimated return to creditors under a liquidation scenario is set out in Section 4 of this report and summarised below:

Best Case Worst Case

Liquidation Unknown Nil

1.6 A second meeting of creditors is to be held on Thursday, 31 January 2019 at 10:30AM AEST. Details as follows:

Date: Thursday, 31 January 2019 Registration start Time: 9:30AM AEST Meeting Start Time: 10:30AM AEST Location: “Avro Room” at Royal on the Park Brisbane 152 Alice Street, Brisbane, Queensland 4000 Should you wish to attend this meeting, please refer to section 2.6 for further information.

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1.7 How do I contact the Administrator?

Should you have any queries, have information that may assist the Administrators’ investigations or wish to discuss the possibility of funding the investigations please do not hesitate to contact Mr Ben Stubbings or Mr Andy Nguyen who are assisting the Administrators via email at BestJetGroup@pilotpartners.com.au

1.8 Privacy

You should note that this appointment is likely to involve the collection of personal information in connection with the insolvent and its stakeholders. Please refer to our website www.pilotpartners.com.au for details of our firm’s Privacy Policy.

Dated this 22nd day of January 2019. NIGEL MARKEY JOINT & SEVERAL ADMINISTRATOR

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Section | TWO

2. MEETING OF CREDITORS 2.1 Pursuant to section 439A of the Corporations Act 2001 (“the Act”), we are required to

convene a meeting of creditors.

2.2 At that meeting, the creditors are required to resolve that the Company's affairs be dealt with in one of the three following ways:

• That the Company execute a Deed of Company Arrangement (“DOCA”); or • That the administration should end; or • That the Company be wound up.

2.3 A meeting of creditors to decide the Company’s future will be held on Thursday, 31 January 2019 at 10:30AM AEST. Details as follows:

Date: Thursday, 31 January 2019 Registration Time: 9:30AM AEST Meeting Start Time: 10:30AM AEST Location: “Avro Room” at Royal on the Park Brisbane

152 Alice Street, Brisbane, Queensland 4000 2.4 Please find enclosed the following for your information:

• Notice of Meeting of Creditors (Appendix A) • Proof of Debt (Form 535) (Appendix B) • Proxy Form (Appendix C)

2.5 If you are unable to attend the meeting this will not affect the validity of your claim against the Company. We will continue to keep you updated as to the progress of the administration.

2.6 If you wish to attend the meeting this is what you need to do:

Step 1 – Proxy Form If you are attending the meeting because you are a creditor personally, you do not need to complete this form. You are required to complete a proxy form if a representative (including the Chairperson) is attending the meeting and voting on your behalf: • If your proxy is to decide how to vote on each of the resolutions put before the

meeting, appoint your proxy as a general proxy.

• If you want to instruct your proxy how to vote on the resolutions, appoint your proxy as a special proxy and vote on each resolution on the proxy form.

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Step 2 – Proof of Debt Form (Form 535)

If you have not already done so, complete this form to lodge your claim in the administration.

We encourage you to lodge your proof of debt electronically by registering on the creditors' portal located at https://creditors.accountants/Job/614/. Alternatively, attached as Appendix B is a Proof of Debt form should you wish to lodge a paper copy.

Step 3 – Lodge forms with Administrators

Complete and return the above form(s) to the Administrators before 12pm, Wednesday, 30 January 2019. This can be done by email, facsimile, post or delivery and will minimise any delay with the commencement of the meeting.

If you are emailing the forms, please put “BESTJET MEETING” in the subject line and email to Bestjetgroup@pilotpartners.com.au

Any forms received after 12pm, Wednesday, 30 January 2019 will not be included for the purposes of the meeting.

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Section | THREE

3. ADMINISTRATORS’ RECOMMENDATION

3.1 We have undertaken an analysis and investigations to consider what is in the best interests of creditors. This is set out in the balance of this report.

3.2 We make the following statement under s75-225 of the Insolvency Practice Rules (Corporations) 2016:

• We do not believe that it is in the creditors' interests to exercise a Deed of Company Arrangement, as no deed has been proposed;

• We do not believe that it is in the creditors' interests for the administration to end giving control back to the Company's director because the Company is not in a position to carry on business and pay its debts as and when they fall due; and

• We believe that it is in the creditors’ best interests and the Administrators’ therefore recommend to creditors that the Company to be wound up for the following reasons:

o No proposal for a DOCA has been received; o The Company has ceased trading; o The Company is insolvent; o The Company has insufficient assets with which to propose a DOCA that will

benefit the creditors; and o Placing the Company into liquidation enables the liquidators to conduct further

investigations into voidable transactions that may benefit creditors.

3.3 Our opinions and our investigations are largely based on those books and records of the Company which we presently have to hand. As we discuss further at paragraph 5.7 below, the books and records of the Company which are presently available to us are largely incomplete. We have undertaken our best efforts to obtain complete information from various sources, but have had limited success to date in that regard. This had caused us great difficulty and hampered our ability to finalise our initial investigations or obtain a complete and accurate understanding of the Company’s affairs. We have prepared this report to creditors based on our review of the limited information that we presently have and the various enquiries we have made, within the limited time that has been available to us. Unfortunately, many matters associated with the affairs of the Company are presently unknown to us. Our investigations are continuing.

3.4 We have not conducted an audit or review as to the accuracy of the records, financial accounts, other documentation pertaining to the Company’s affairs and the advice of the Company’s officer. We therefore provide no warranty as to the accuracy, completeness or reliability of same.

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3.5 Administrators’ Prior Involvement

A copy of the Administrators’ Declaration of Independence, Relevant Relationships and Indemnities (“DIRRI”) is attached at Appendix D and was provided with our first report to creditors.

No further matters have arisen that would require an update to the DIRRI.

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Section | FOUR

4. LIKELY RETURN TO CREDITORS 4.1 In making our recommendation to creditors we have considered and estimated the likely

return to creditors as follows:

Best Case Worst Case

Liquidation Unknown Nil

4.2 Attached as Annexure E is an Estimated Statement of Position which provides further details of our calculation of the likely return to creditors under a liquidation scenario.

4.3 Liquidation Scenario

Employee Creditors In a liquidation scenario employee creditors will be able to immediately lodge claims with the Fair Entitlements Guarantee (“FEG”) Scheme to recover outstanding entitlements (excluding superannuation). A fact sheet explaining employee’s eligibility to claim under FEG is available at https://docs.jobs.gov.au/documents/general-information-claimants. Employee claims are priority claims in a Liquidation and will rank ahead of unsecured claims in the event a dividend is paid. Unsecured Creditors Under a Liquidation scenario the likely return to unsecured creditors is dependent upon the following factors:

• the size and complexity of the administration; • the value of realisable assets and the costs of realising those assets; • the statutory priority of certain claims and costs; • the value of various classes of claims including secured, priority and unsecured

creditor claims; and • the volume of enquiries by creditors and other stakeholders.

Pursuant to the provisions of the Act, certain transactions entered into by the Company may be recoverable by a liquidator as opposed to an administrator. Further details of our investigations are set out in section 6 of this report.

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It may be possible for a Liquidator to recover from the director (or a de facto or shadow director) an amount equal to the loss or damage suffered from trading the Company whilst insolvent. Further details of our investigations are set out in section 7 of this report.

Related party claims to date total approximately $222,438 and are detailed at Note 10 of Section 5.8. The impact of related party creditor claims on the estimated return to creditors is unknown. We note these claims represent approximately 1% of the creditors of the Company. Any related-party claims will be adjudicated upon to ensure their validity. We estimate the timing of a return to creditors to be between 12 and 24 months from the date of liquidation due to following tasks which will require completion before the funds available for distribution can be determined:

• Complete investigations into the Company’s affairs including;

o A determination as to whether monies held in one of the Company’s bank accounts are held by it on trust for a third party and thereby unavailable for the purpose of paying a dividend to creditors;

o Singapore and Philippines operations; o Separation of client funds; o Insolvency of the company.

• Secure access to all Company records, including taking necessary legal action;

• Realise all Company assets;

• Should it be necessary, cause the Court to determine at a trial the question as to

whether the monies held in one of the Company’s bank accounts are held on trust for a third party and thereby unavailable for the purpose of paying a dividend to creditors;

• Consider voidable transactions and take any recovery action, including legal action,

if considered commercial;

• Focus on related party transactions with the Company and determining their recoverability;

• Consider the conduct of a Public Examination of relevant persons in order to obtain

further books and records and oral evidence in relation to the Company’s affairs and potential actions that may lead to recovery for creditors;

• Adjudicate on creditor claims and deal with any appeals;

• Calculate and distribute a dividend to creditors; and

• Any other tasks as required.

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Section | FIVE

5. COMPANY INFORMATION 5.1 Background Information

Statutory information for the Company is summarised as follows: Company Name: Bestjet Travel Pty Ltd

ACN: 155 965 601

ABN: 71 155 965 601

Date of Incorporation: 28 February 2012

Director(s) Name Date Appointed Date Ceased

Robert Bruce McVicker 2 November 2018 N/A

Rachel Catherine James 28 February 2012 2 November 2018

Shareholders Name Class of Share No. Held

McVicker International Pty Ltd (as trustee see section 5.2) Ordinary 150,120

Name of Trust: N/A

Trading Names: Bestjet.com

Business: The Company operated as an online airline booking business.

Principal Place of Business The business operated from Level 2, 22 Wandoo Street, Fortitude Valley, Queensland 4006.

Trading Status The Company ceased trading on 18 December 2018 prior to the Administrators being appointed.

Our enquiries have revealed that there have been no winding up proceedings commenced

against the Company.

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5.2 Summary of Shareholdings

On initial investigations indicate that the share capital of the Company, being 150,120 ordinary shares, is held as follows:

o 50% - McVicker International Pty Ltd as trustee for The McVicker International Trust o 50% - McVicker International Pty Ltd as trustee for Rachel James

A summary of the historical shareholdings of the Company is outlined below:

Date Notes Ordinary Shares

Robin Mark Smith

Rachel Catherine

James

McVicker International Pty Ltd ATF McVicker

International Trust

Total (Balance)

28-Feb-12 Allotment 60 60 120 01-Sep-12 Allotment 50,000 50,000 100,120 12-Sep-13 Transfer -6,952 6,952 100,120 21-Nov-13 Transfer -33,636 33,636 100,120 01-May-14 Transfer -4,736 4,736 100,120 05-Mar-17 Transfer -4,736 4,736 100,120 09-Jun-17 Allotment 0 50,000 150,120 02-Nov-18 (1) Transfer 0 -150,120 150,120 150,120

Note (1)

The transfer documents lodged with ASIC on 9 November 2018 do not disclose, nor are they required to disclose, details of the trust which is the ultimate beneficial holder of the shares in the Company. The following forms evidence the transfer of 150,120 ordinary shares in the Company to McVicker International Pty Ltd as trustee for The McVicker International Trust:

• Share Certificate • Standard Transfer Form • Notice of Beneficial Ownership • Declaration of Trust

The Share Sale Agreement dated 2 November 2018 executed by McVicker International Pty Ltd and Rachel James (both on her own behalf and on behalf of the Company) provided for:

• The sale of 75,060 ordinary shares by Rachel James to McVicker International Pty Ltd as trustee for The

McVicker International Trust for $1,500,000 payable on 31 October 2020. • A condition precedent to the sale, being the execution of the following documents by the parties:

Shareholders Agreement Bare Trust Deed Put and Call Option Agreement Deed of Warranty

The effect of these conditional documents we believe is as follows:

• Rachel James transfers her remaining 50% (75,060 ordinary shares) of her shareholding to McVicker International Pty Ltd to be held as trustee for Rachel James.

• The Put and call Option Agreement allows McVicker International Pty Ltd as trustee for Rachel James the option to purchase 60,048 ordinary shares (40% of the share capital) in October 2020 from McVicker International Pty Ltd as trustee for The McVicker International Trust. In the event that either the put or call options are exercised, Rachel James would control 90% of the issued capital of the Company by October 2020.

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5.3 Company Structure

The Company is the parent entity within a Group. It wholly owns (as its subsidiary) Brooklyn Travel Pty Ltd (“Brooklyn”). We have been advised by the director that this company never traded. Brooklyn wholly owns (as its subsidiary) Wynyard Travel Pty Limited (“Wynyard”), a travel agent that provided corporate travel services in Sydney. The Company acquired Wynyard in 2016. We were also appointed Voluntary Administrators of both Brooklyn and Wynyard on 18 December 2018.

5.4 Company History

The business commenced in February 2012 and the sole director and shareholder was Ms Rachel James. Ms James is the wife of Mr Michael James who was an employee and played a key role in the Company. The current director is Mr Robert McVicker (Jnr), who is also the sole director of its subsidiary companies, Wynyard and Brooklyn. By way of background, Wynyard was acquired via Brooklyn in June 2016 and operates as a commercial travel agent based in Sydney.

We refer to section 5.2 of this report which details the former and current shareholdings of the Company.

Mr McVicker remained the sole director of Wynyard, Brooklyn and the Company up until the appointment of the Administrators on 18 December 2018.

Bestjet Travel Pty Ltd (Administrators Appointed)

Brooklyn Travel Pty Ltd (Administrators Appointed)

Wynyard Travel Pty Limited (Administrators Appointed)

Wholly owned

Wholly owned

Director: Robert McVicker

Shareholder: McVicker International Pty Ltd (as trustee)

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As a result of the repeal of various state-based Travel Agent Acts, the Australian Federation of Travel Agents (“AFTA”) set up the AFTA Travel Accreditation Scheme (“ATAS”) which commenced on 1 July 2014. In order to become accredited with ATAS a travel agent must meet strict criteria and be recognised as a ‘credible, well trained and a professional business’. Our investigations have revealed that the Company obtained accreditation with ATAS on 11 July 2014. On 30 April 2015 the Company applied to renew its accreditation with ATAS. This application was declined on 3 August 2015. We understand that AFTA concluded that Mr James was a “close associate” of the Company within the meaning of clause 2.5 of the Eligibility Criteria for ATAS. As a result, the Company did not satisfy the applicable eligibility criteria to be accredited with ATAS. For further information in relation to Mr James’ role in the Company refer to section 7.2 of this report. The Company subsequently appealed AFTA’s decision and commenced litigation proceedings in the Supreme Court of Queensland. On 18 March 2016 the Company was notified that the appeal had been dismissed and its’ application for renewal of its accreditation was declined. The Company continued to operate without ATAS accreditation until it ceased trading prior to the appointment of the Administrators.

5.5 Company’s Operations The business the Company operated was a high volume, low margin retail online travel agency via a dedicated web channel. The Company carried on business from leased premises at Level 2, 22 Wandoo Street, Fortitude Valley, Queensland with approximately three staff in the Brisbane office. The Company utilised the services of one or more payment aggregators which facilitated the receipt of merchant transactions from customers. Where customers obtain chargebacks from their financial institution for credit card transactions, we expect that responsibility for this loss will ultimately rest with the payment aggregator, who in turn may have a considerable claim with the Company. As best we can determine, many customers who paid for their tickets with a credit card caused their credit card providers to pay funds to the bank account of the relevant payment aggregator (such as IntegraPay), not the Company. Once the payments had been cleared by the payment aggregator, it then paid monies from its bank account to the Company’s bank account. Hence, customers who paid by credit card did not make payments directly to the Company’s bank account. The payment aggregator was substituted as a “middleman”. Credit card customers paid the payment aggregator, who in turn paid the Company. This means that credit card customers who paid for tickets through the payment aggregator (or their banks or insurers) may have a claim against the payment aggregator for recovery of the monies they paid. That will be a matter for them (or their banks or insurers) to take up with the payment aggregator. Those customers may (or may not) be creditors of the Company. That is a matter to be determined in due course. Most likely, it will be determined by the liquidators of the Company, should the creditors vote at the Second Meeting to put the Company into liquidation.

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Many of the customers who have paid by credit card have already lodged proofs of debt for the purposes of the First Meeting of Creditors, all of which we admitted in full at that meeting for voting purposes. We will need to again consider and determine, on the information now known to us, whether those credit card customers are persons entitled to vote as creditors at the Second Meeting of Creditors. On the information presently available to us, we intend to admit them in full for voting purposes as we did at the First Meeting of Creditors. However, if and when, a liquidator is in a position to make a distribution to creditors, the liquidator will carefully adjudicate on the point at that time, without reference to what occurred at the Meetings of Creditors. The Company was accredited with the International Air Transport Association (“IATA”) (which is a trade association for the world’s airlines, representing approximately 290 airlines or 82% of all air traffic) and executed a Passenger Sales Agency Agreement with it. IATA and member and non-member airlines participate in the Billing Settlement Plan (“BSP”) for Australia which is a system designed to facilitate and simplify the selling, reporting and remitting procedures of IATA Accredited Passenger Sales Agents (Travel Agents). The Company also utilised the services of CVFR which is essentially a wholesale ticket provider.

THIS SPACE HAS INTENTIONALLY BEEN LEFT BLANK

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The below chart outlines the flow of funds through the business of the Company as best we presently understand it.

We further note the following:

• The director has advised that the Company’s main source of sales was through a comparison website, Skyscanner.

• The billing periods with IATA and CVFR were approximately 7 days and 5 days respectively i.e. this was the time period between the customer paying the Company and the Company paying either IATA or the consolidator. In effect these parties extended credit to the Company for these periods.

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• Up until approximately 19 November 2018, IATA would direct debit the Company’s

bank account on a weekly basis for funds due to it by the Company. After 19 November 2018, IATA drew more frequent payments. The frequency of draws by IATA was nearly daily. We are advised that this was the result of the following factors:

o The change in ownership of the Company; and o The delays with the annual financial review and submission of the audited

accounts.

• It appears as though some tickets purchased through the Company were purchased with Wynyard’s IATA BSP. Whilst we are still investigating this, it appears that the Wynyard purchased tickets for the Company, as its agent. We believe that this was done because Wynyard appeared be able to secure better commercial arrangements with airlines than the Company could obtain. Our investigations suggest that Wynyard may have purchased tickets for the benefit of the Company’s customers, in circumstances where the Company has not paid for the tickets. It is therefore likely that Wynyard is a significant creditor of the Company in respect of monies owed to Wynyard in relation to these transactions which remain unpaid.

• Given the high turnover of the Company, the client monies received in these periods were considerable and accordingly the liability created may well have exceeded $10 million.

• We note that IATA has advised that the Company signed a Passenger Sales Agency agreement which stipulated the following term:

“…All monies collected by the Agent for the transportation and ancillary services sold under this Agreement, including applicable commissions which the Agent is entitled to claim thereunder, shall be property of the Carrier and shall be held by the Agent in trust for the Carrier or on behalf of the Carrier until satisfactorily accounted for to the Carrier settlement made….”

• Our initial review of the Company’s bank accounts indicates that the Company did

not maintain client funds in trust. Whilst the Company maintained a separate client account, it appears client monies were not retained and were expended in the ongoing operations of the business.

• In respect of Company transactions that were processed through the Wynyard IATA BSP, it is evident that the Company transferred funds on the day they were due to Wynyard to settle with IATA. Wynyard did not appear to hold these client funds. We are yet to complete our investigations into these matters. They are ongoing.

5.6 Overseas Entities

Bestjet Travel Pte Ltd (“Bestjet Singapore”)

Bestjet Singapore is a company within the Bestjet Travel Group which was registered in Singapore. We have not been appointed as Administrators of Bestjet Singapore and do not exercise any control over it.

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Our initial investigations indicate that Bestjet Singapore entered into a subscriber agreement with Sabre Asia Pacific Pte Ltd (“Sabre”) on 10 October 2015 pursuant to which segment rebates and incentives earned by the Company and Wynyard in the course of operating their businesses are payable to Bestjet Singapore. We understand that the Company and Wynyard have historically done all things that are necessary to trigger an entitlement to segment rebates and incentives pursuant to this agreement and that Bestjet Singapore had historically remitted to the Company funds received from Sabre in respect of those segment rebates and incentives.

The director alleges that at the date of our appointment approximately $3.2 million was due to Bestjet Singapore by Sabre and he expected those funds to pass to the Company. This did not occur within the expected timeframe, resulting in the appointment of Voluntary Administrators.

We note that segment rebates owing from Sabre were disclosed in the financial accounts for the year ended 30 June 2018.

Our investigations are continuing into what agreements and arrangements, were in place between the Company and Bestjet Singapore particularly in relation to the Company’s rights or access to the segment rebates. We believe that the Company has a claim to the rebates due at the date of our appointment and are attempting to obtain any such rebates for the benefit of the Company’s creditors. We expect that this matter will be contested and may be the subject of legal proceedings.

A summary of the company search for Bestjet Singapore is detailed below.

Company Name: Bestjet Travel Pte. Ltd.

Country of Incorporation: Singapore

Date of Incorporation: 10 September 2015

Director(s) Name Date Appointed Date Ceased

Rachel Catherine James 10 September 2015 N/A

Nancy Tan (also Secretary) 10 September 2015 N/A

Unikrishnan Sugandhi (Secretary) 18 October 2017 N/A

Shareholders Name Class of Share No. Held

Bestjet Travel Holdings Pty Ltd Ordinary 1

The shareholder entity, Bestjet Travel Holdings Pty Ltd was incorporated in Australia on 15 July 2015 with Rachel James as the sole director and shareholder.

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OTAlab Pte Ltd (“OTAlab”) OTAlab is a realted company registered in Singapore of which Mr James (amongst others) is a director. OTAlab is wholly owned by ‘Sea Wagon Investments Limited’ which is incorporated in the British Virgin Islands. Searches requested from the BVI Financial Services Commission indicate that the register of directors is private and not able to be disclosed to the public. We have not been appointed as administrators of OTAlab. The Company is in receipt of an invoice from OTAlab dated 17 December 2017 for “Philippines Payroll, Annual Leave and Termination Notice” in the amount of USD$98,679.82. The 2017 financial year accounts we have reviewed indicate the Company’s principal activity was other IT and computer service activities and business and management consultancy services. A summary of the company search for OTAlab is detailed below.

Company Name: OTAlab Pte. Ltd.

Country of Incorporation: Singapore

Date of Incorporation: 15 September 2016

Director(s) Name Date Appointed Date Ceased

Michael David James 13 November 2017 N/A

David George Gordon Lanning 15 September 2016 N/A

Nancy Tan (also Secretary) 15 September 2016 N/A

Suan Wee Tan 15 September 2016 N/A

Unikrishnan Sugandhi (Secretary) 15 September 2016 N/A

Shareholders Name Class of Share No. Held

Sea Wagon Investments Limited Ordinary 1

We understand that Mr Lanning had submitted the appropriate forms to resign as a director. However, this has not been reflected on the search obtained from the Singapore Accounting and Corporate Regulatory Authority. Further investigation is required into the Company’s relationship with OTAlab and particularly the arrangements or contracts that were in place regarding the call centre services allegedly provided to the Company.

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OTAlab Customer Support Services (“OTAlab CSS”) We are aware that the Company may have utilised services of call centres in the cities of Cebu and Davao in the Philippines. These call centres appear to have dealt with initial support enquires from customers. Based on our initial investigations we understand that these staff were employed by OTAlab Customer Support Services. OTAlab CSS was a business name registered by Michael James personally in the Philippines as a sole proprietor. Further investigation is required into the Company’s relationship with OTAlab CSS and particularly what arrangements or contracts were in place regarding the call centre services allegedly provided to the Company.

5.7 Books and records of the company

The Company engaged external accountants to control and maintain the preparation of financial data. We have been advised that the financial data of the Company was maintained through the accounting package MYOB, and most recently Xero, and customer data was managed through ‘Salesforce’. The Company also relied on the services of an external accountant, BDO, who have advised they were appointed as advisors to the Company in preparation for the audit for the financial year ended 30 June 2018. BDO has provided us with books and records pertaining to the Company’s affairs. We have issued requests to all current and former accountants, tax advisors and auditors for books and records pertaining to the affairs of the Company. We have obtained the Company’s 2017 (with 2016 comparatives) and 2018 financial statements and the Consolidated Group’s 2018 (with 2017 comparatives) financial statements which are summarised at section 5.9. We have obtained access to the Company’s MYOB account, however these accounts do not appear to have been reconciled, or had data inputted into them, for some time. Hence it is our view that they are unable to be relied upon. Hanrick Curran were engaged to prepare the audited financial accounts for the year ending 30 June 2018 for the Company and the consolidated Group, including Brooklyn and Wynyard, and were the Company’s auditor at the date of our appointment. The audit for the year ended 30 June 2018 was finalised on 12 December 2018 and provided to IATA. Subsequently, on 20 December 2018, Hanrick Curran, purported to withdraw their audit opinion. Our initial investigations into the Company’s financial affairs have proved unnecessarily difficult as a result of the following:

• Prior to our appointment, it is alleged that computer and security equipment were removed from the premises. It is currently unclear who removed this equipment from the Company’s premises and we note the Company’s director, Robert McVicker (Jnr), has facilitated the lodgement of a report with the Police in respect of this incident.

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• The records available to us are largely incomplete, which has caused our initial

investigations to be carried out with great difficulty.

• The current director, Mr McVicker (Jnr), has limited knowledge of the Company’s affairs and has referred us to Mr James.

• We have made enquiries with Mr James and Ms James in order to obtain Company books and records and information in relation to the Company’s affairs. Mr James responded, on his own behalf and on behalf of Ms James, to our initial request advising that they have no records in their possession.

• Mr James asserts that the staff based in the Philippines control access to Xero.

• Mr and Ms James have failed to respond to our various enquires regarding the Company’s affairs.

• We note that the auditor’s withdrawal of their audit opinion for the 30 June 2018 financial statements casts significant doubt on the reliability of those accounts.

• We have no current creditor ledgers with customer data and debt amounts. As a result, we have been unable to identify and contact the Company’s creditors other than those disclosed by the director in his ROCAP.

• We are unable to access the Company’s Xero file in order to obtain management accounts for the Company. We have received confirmation that the Company’s Xero account subscriber is Mr James. Xero is unable to provide access to the account unless Mr James either authorises our request or is non-responsive to their request. Xero has anticipated providing the Administrators access to the Xero account.

• The website domain ‘bestjet.com’ is administered by Bestjet Singapore and is not under our control. This has severely hampered our ability to communicate with customers and creditors who may be affected by the voluntary administration.

• We have attempted to gain access to the Company’s web services and records hosted by Amazon Web Services (“AWS”). We believe that the information contained on the servers is critical to our investigations into the Company’s affairs. Our solicitors have written to AWS demanding access. However, as at the date of this report, no response has been forthcoming from AWS. We are currently seeking advice from our solicitors regarding the merits of an application to the Court compelling Amazon to provide access to the Company’s web servers.

• Our solicitors have also written to Google demanding access to the Company’s email accounts. As at the date of this report, our solicitors are yet to receive a response from Google. As such, we are currently seeking advice from our solicitors regarding the merits of an application to the Court compelling Google to provide access to the Company’s email accounts

We have requested ASIC’s assistance in recovering any books and records from Mr and Ms James.

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Liquidators have powers to request books and records from various parties and can use these power to obtain further information to complete their investigations into the financial history and performance of the Company.

5.8 Company Assets and Liabilities

The director is required to submit to the Administrators a Report on Company Activities and Property (“ROCAP”) in the prescribed form and deliver up any books and records of the Company. The ROCAP sets out the Company’s financial position to the best of the director’s knowledge and belief as at the date of administration.

The report is summarised below and explained further in the notes that follows. Time has not permitted us to confirm the accuracy of the information, and while we have no reason to doubt the legitimacy of it, we reserve the right to alter any conclusions should the information relied upon be shown to be incorrect. The Administrators have provided the information to assist the creditors in their understanding of the Company’s affairs.

SUMMARY OF ROCAP

Notes

Book Value

Director’s ERV* Administrators’

ERV* $ $ $

Assets Cash at Bank 1. 3,604,867 Unknown 3,609,858 Debtors 2. 6,246,849 Unknown Unknown Plant and Equipment 3. 104,380 Unknown Nil Related Party Loan 4. 44,298 Unknown Unknown Intangible Assets 5. 597,465 Unknown Unknown Other Assets 6. 319,644 Unknown Nil Total Assets 10,917,503 Unknown 3,609,858 Liabilities Secured Creditors 7. Nil Nil Nil Employee Claims 8. Unknown Unknown 13,253

Unsecured Creditors 9. 1,516,632 1,516,632 10,557,223Related Party Creditors 10. 132,438 132,438 222,438

Estimated Surplus/(Deficiency)

1,649,070

9,268,433

1,649,070

Unknown

10,792,914

(7,183,056)

*Estimated Realisable Value

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NOTES

1. Cash at Bank

As at the date of our appointment the Company held bank accounts with the following

financial institutions:

Bank Balance of Funds ($) National Australia Bank Limited 3,607,779 Commonwealth Bank of Australia Limited 1,917 Westpac Banking Corporation 162 Total 3,609,858

The accounts were frozen shortly after our appointment and the balance of funds, being $3,609,858 have been recovered.

We note that IntegraPay (being the Company’s principal payment aggregator) has given notice to us that it asserts an entitlement over the entirety of these funds. Integrapay asserts that the monies it paid to the Company are now held by the Company on trust for it. In essence, Integrapay contends that:

a) these monies were paid for the purpose of the Company purchasing tickets for those customers who had made payments to its bank account;

b) the Company and Integrapay agreed that, should this purpose fail, these monies would be returned to it; and

c) this purpose has now failed, so the Company holds these funds on trust for it. We are currently seeking legal advice regarding the validity of these claims. IntegraPay has not yet established a basis to these funds. We note that in order to determine this issue, it may be the subject of legal proceedings. Should IntegraPay be successful in establishing the trust over the monies in its favour, this may exhaust all the funds that administration currently holds. We have also contacted the following other third party payment providers that the Company may have utilised:

• Baintree • MINT • E-nett • Paypal • First data • POLi

E-Nett has advised that a balance of $1,387 remains in the Company’s account. We have requested the balance of funds to be transferred to into our administration account. POLi have confirmed they hold $60.60 that will be returned to the Administrators. POLi confirmed that customer funds are never received by POLI, they directly send funds to the merchant’s bank account. We are currently awaiting a response from the remaining payment providers.

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2. Debtors

The director has advised that the following entities may be debtors of the Company and/or Wynyard Travel Pty Limited:

Debtor Notes Amount ($)

Sabre (1) 3,200,000 Various Airlines (2) 946,849 CVFR (3) 2,100,000 Amadeus/Travelport (2) Unknown Total 6,246,849

(1) Further to section 5.6 of this report, it is our understanding that Bestjet Singapore entered into a subscriber agreement with Sabre to collect rebates which appear to be based on the turnover generated by the Company and Wynyard in the course of their businesses. We believe that it did so as the agent the Company and Wynyard, such that all monies payable to Bestjet Singapore by Sabre must be remitted to the Company and Wynyard. Sabre has advised that it entered into an agreement with Bestjet Singapore, not the Company or Wynyard, and raised concerns as to whether the agency arrangement in fact exists. We are continuing with our investigations and discussions with Sabre in order to finalise this matter as quickly and amicably as possible.

(2) The Company and Wynyard appeared to have had various agreements with airlines to receive

incentives/rebates. We have requested payment of override incentives/rebates that may also be owing to the Company and/or Wynyard. A number of these parties may have competing claims against the Company that may exceed the amount outstanding to the Company.

(3) CVFR has advised that the Company has no entitlement to override incentives. We are

investigating this claim further.

We note that the financial accounts of the company for the 2018 financial year ended 30 June 2018 disclose rebates owing from both CVFR and segment rebates owing from Sabre. Please refer to our comments at section 5.9 of this report.

3. Plant and Equipment

The Company’s plant and equipment consisted of some computer equipment and office furniture located at the Brisbane premises. As previously advised, some of the Company’s computer equipment was removed by an unknown party prior to our appointment.

The remaining plant and equipment is of no commercial value after taking into account

associated selling and removal costs.

4. Related Party Loan

The director has disclosed in his ROCAP a ‘loan to previous director’ for the year ending 30 June 2018 in the amount of $44,298. We have reviewed the financial statements. They also disclose the loan owing by Rachel James and we have issued a demand for repayment.

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5. Intangible Assets

The director has disclosed in his ROCAP ‘intangible assets’ (which is also disclosed in the Company’s financial statements for the year ending 30 June 2018) with a book value of $597,465. A review of the Company’s financial statements for the year ending 30 June 2018 confirms that this is in respect of the following assets:

• Online travel agent web system; and • Accommodation rights held on a license with Disney Vacation

Development Inc.

The financial statements note the following:

“Bestjet purchased an ownership interest in the Aulani, Disney Vacation Club Villas, Ko Olina, Hawaii I Vacation Ownership Plan. As part of the interest, Bestjet has access to the Disney hotel network.”

We have written to the Resort requesting further details of the Company’s ownership.

We have also identified the following additional intangible assets:

• The ‘Bestjet.com’ registered trademark; • The business name, ‘bestjet.com’; • Airline and third party contracts/agreements; • Salesforce infrastructure; and • Customer lists (subject to AWS supplying access for the Company’s servers).

Should any party have an interest in purchasing the Company’s intangible assets, please contact our office.

Our investigations have revealed the website domain, ‘Besjet.com’ is administered by Bestjet Singapore and on the face of it is not an asset of the Company.

The value of the Company assets, if any, is difficult to assess. A liquidator would attempt to market these assets to obtain a fair market value.

6. Other Assets

The director has disclosed the following other assets in his ROCAP:

Asset Amount ($) Comment Tax Refund 283,749 We have confirmed that this refund was

received prior to our appointment, on 13 December 2018, and is disclosed in the Company’s bank account. There are no tax refunds owing to the Company.

Lease Security Deposit

35,895 We have issued a demand to the landlord in respect of the security deposit. It is likely that the landlord will have a counter claim in respect of outstanding rent and breach of contract. The full amount may not be recoverable.

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Bestjet Singapore OCBC USD

Unknown Information available to the Administrators has confirmed this account is in the name of Bestjet Singapore. The balance of funds, if any, do not appear to be an asset of the Company.

Total 319,644

7. Secured Creditors

A search of the Personal Property Securities Register (“PPSR”) has not revealed any security interests registered over the Company’s assets.

8. Employee Claims

Employee claims are afforded priority over the claims of other unsecured creditors pursuant to section 556 of the Act and the circulating security interests held by secured creditors pursuant to section 561 of the Act. The Company employed two staff excluding the director. Another staff member was also due to join the Company in early 2019. We have received the following claims for outstanding employee entitlements:

Entitlement Amount ($)Unpaid Wages 5,255Superannuation UnknownAnnual Leave UnknownPayment-in-lieu-of-notice 7,998Redundancy UnknownTotal 13,253

The exact balance will not be determined until all employees have lodged their proofs of debt with us, and we have adjudicated on them. Should an employee have a claim against the Company for unpaid entitlements, and they have not already done so, they should contact the Department of Job and Small Business on 1300 135 040 in relation to Fair Entitlements Guarantee (“FEG”) or alternatively follow the Fair Entitlements Guarantee link under Workplace Relations at www.jobs.gov.au for advice as to the eligibility of their claim. Employees are unable to access FEG until the company enters into Liquidation.

9. Ordinary Unsecured Creditors

The Company’s records indicate that there are 4,684 ordinary unsecured creditors with claims estimated at $10,779,661. Whilst the exact claims of creditors will not be determined until all creditors have lodged their proofs of debt, we advise that the known creditors of the Company consist of:

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Creditors Note Amount ($) Trade Creditors 10,557,223 Related Party Creditors 1 222,438 Total 10,779,661

Note 1. Refer to note 10 below

10. Related Party Creditors OTALAB The director has disclosed a debt in the amount of USD$96,679.82 (approximately $132,438 at an exchange rate of 0.73) owing to OTAlab Pte. Ltd. The invoice indicates OTAlab charged the Company for the use of the Philippines call centre and staff termination costs. However, other documents in our possession indicate the Philippines staff were employed by Otalab CSS. See section 5.6 for further details. Michael James The director has advised that Michael James is owed an amount in relation to unpaid employee entitlements. The director was unable to quantify the amount owed. Under the Act, Mr James would be limited to claiming a maximum of $2,000 in respect of wages and superannuation outstanding and $1,500 for outstanding employee leave entitlements, with the balance of an employee entitlement claim ranking as an unsecured creditor. Mr James has indicated he has a claim for loans provided by his superannuation fund for $55,000 and a personal loan of $35,000. We point out that no formal proof of debt or claim has been received to date. Under the Act Mr James would rank as an unsecured creditor for these claims. Wynyard

Wynyard Travel Pty Limited (Administrators Appointed) may be a creditor of the company for Bestjet tickets purchased through Wynyard’s IATA BSP on behalf of Bestjet. This claim is yet to be quantified but could be up to $6.7 Million.

5.9 Financial Performance

The financial statements for the years ended 30 June 2017 and 30 June 2018 were prepared by the Company’s external accountants and audited by the Company’s external auditors. As noted at section 5.7 of this report, the Company’s external auditors ‘withdrew’ their audit opinion in relation to the audit of the Company’s 2018 financial statements. For the purpose of forming our opinions, our analysis has been based on those financial statements. We have not undertaken our own audit or verified the financial information below.

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The Company’s trading results for the financial years ending 2016, 2017 and 2018 are summarised below.

30/06/2016 ($)

30/06/2017 ($)

30/06/2018 ($)

Profit and Loss Statement

Commissions - Ticket Sales 6,323,803 2,687,441 2,866,398

Rebates and other fees from travel services 3,281,257 7,187,393 7,284,732

Interest Income 53,579 48,798 14,018

Other Income - - 37,637

Total Income 9,658,639 9,923,632 10,202,785

Cost of Sales - Direct Expenses 7,283,002 8,349,455 4,708,742

Employee Expenses 713,091 511,106 838,905

Income Tax Expense 326,220 - -

Other Expenses 734,108 530,483 2,741,592

Total Expenses 9,056,421 9,391,044 8,289,239

Net Profit/(Loss) 602,218 532,588 1,913,546

Balance Sheet Bank Accounts 8,050,083 2,835,677 2,300,728

Receivables 3,582,111 4,430,681 11,791,363

Total Current Assets 11,632,194 7,266,358 14,092,091

Related Party Loans 394,379 503,749 45,121

Plant and Equipment 420,731 279,941 104,380

Intangible Assets 217,541 695,246 598,651

Total Non-Current Assets 1,032,651 1,478,936 748,152

Total Assets 12,664,845 8,745,294 14,840,243

Payables 11,058,099 6,880,298 11,040,162

Short-Term provisions 376,897 31,571 53,112

Total Current Liabilities 11,434,996 6,911,869 11,093,274

Total Non-Current Liabilities - - -

Total Liabilities 11,434,996 6,911,869 11,093,274

Net Assets/(Liabilities) 1,229,849 1,833,425 3,746,969

Current Ratio 1.02 1.05 1.27

Debt/Asset Ratio 0.90 0.79 0.75 Notes:

(1) Current Ratio = Current Assets / Current Liabilities (2) Debt Ratio = Total Liabilities / Total Assets

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The available financial accounts, summarised above, reflect as follows:

• The Company operated at a profit during the three periods under review whilst the company’s total income continued to grow from period to period.

• The profit and loss summary does not disclose gross ticket sales and gross ticket expenses. Only the net proceeds received from ticket sales (commissions/rebates) are disclosed. Although the same net profit is derived, the inclusion of gross ticket sales and gross ticket expenses would see total income and total expenses increase significantly and be in the hundreds of millions of dollars.

• The Company’s current assets and net assets grew significantly from 2017 to 2018, largely

due to trade receivables increasing by over $7,000,000. The notes to the financial statements disclose trade receivables as consisting of airline incentives/rebates. In particular the accounts identify airlines overrides due from CVFR of $1,125,823 and segment rebates due from Sabre of $3,562,022. We refer to note 2 of section 5.8 for our comments on Sabre rebates.

• The Company had a positive current ratio (above 1) for the three periods under review.

This indicates that in broad terms the Company had sufficient working capital to pay its debts as and when they fell due.

• The Company also had a positive debt to asset ratio (below 1), indicating that the

Company could meet its obligations by liquidating assets if required.

• Due to the Administrators’ difficulties in obtaining access to the Company’s electronic accounting programs, we are unable to provide details of the Company’s financial statements as at the date of our appointment.

• Ms James’ salary and superannuation was $181,939 in the financial year 2018 and $245,533 for the prior year. Ms James’ loan account reduced by $431,283 (i.e. her indebtedness to the Company reduced) in the 2018 financial year.

• A review of the 2018 financial statements has revealed that the current assets section appears to include a Bestjet Singapore OCBC USD account in the amount of $1,050,059. We understand this account is registered in the name of Bestjet Singapore and is not an asset of the Company. Accordingly, the amount disclosed in the financial statements for 2018 under “Bank Accounts” does not appear to be an accurate record.

• The Company’s income model appears to have moved from commission based income to rebates based income in 2017. The table below indicates the percentage of total income from rebates and commissions: 30/06/2016 30/06/2017 30/06/2018 Commissions 65% 27% 28%Rebates 34% 72% 71%

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• A summary of the Gross Profit for the Company, as summarized in its financial statements, is as follows: 30/06/2016 30/06/2017 30/06/2018 Gross Ticket Sales 226,921,677 346,251,928

Not Available Cost of goods sold 227,880,876 351,913,942 Gross Profit/(loss) (959,199) (5,6620,14)

In 2016 and 2017, the cost of tickets sold by the Company exceeded the revenue generated from them.

• It appears as though for some time there has been a deficiency in cash available to meet the client funds received at any given time. This is represented in the below table: 30/06/2016

($) 30/06/2017

($) 30/06/2018

($) Cash and Cash Equivalents 8,050,083 2,835,677 2,300,728Less Client Clearing Account – BSP 523,062 120,251 9,755,233Accruals – Travel Consolidators 9,652,839 6,474,545 912,483Deficiency in client funds (2,125,818) (3,759,119) (8,366,988)

Note

The Cash and Cash Equivalents balance in 2018 includes the Bestjet Singapore bank account which contained $1,050,059. This would increase the estimated deficiency in client funds.

5.10 Cause of Company’s failure

The director of the Company advised the following is the reason for failure of the Company:

“Since we acquired Bestjet in November, we have worked with the former owners to improve the business and customer service experience. Representations made to the Company failed to materialise and, unfortunately, we have been left with no choice but to place the business into voluntary administration to determine the best course of action for customers and suppliers, and to see whether Bestjet can continue to trade”.

In our opinion, based on our initial investigations to date, the following factors are significant factors leading to the Company’s present financial situation:

• The Company historically sold tickets for less than their cost; • The Company’s inability to maintain client funds in a separate account resulting in a

deficiency in Client funds to meet current outstanding to ticket issuers; • Rebates historically received from Bestjet Singapore failed to materialise. The

Company’s inability to obtain and recover rebates was critical to its ongoing viability; and

• IATA seeking daily payments instead of weekly, thus reducing the Company’s working capital. This was in place from the change of ownership in November 2018 until our appointment.

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Section | SIX

6. RECOVERABLE TRANSACTIONS

6.1 Possible recoverable transactions

Pursuant to the provisions of the Act, certain transactions entered into by the Company may be recoverable by a liquidator as opposed to an administrator. The Administrators’ investigations into the Company’s affairs include determining whether the Company has entered into any recoverable transactions. It should be noted that this report is based on investigations which have been carried out over the relatively brief period since our appointment and based on limited available information. A Liquidator will be required to conduct further investigations into possible recoverable transactions, as well as initiating recovery actions if warranted.

6.2 Unfair Preferences

The Administrators have undertaken a preliminary review of the transactions entered into by the Company during the six month period prior to the relation-back day, being 18 December 2018. However, due to limited access to company books and records we have been unable to complete our unfair preference investigations. Further investigations will be required by the Liquidator to determine if identified transactions are likely to be considered as preferential payments by a Court and if there is sufficient evidence available to support an action for recovery. The recoverability of unfair preferences should be considered in the light of costs, time taken to recover, and available evidence. In our experience, creditors often defend any action taken to recover unfair preferences and accordingly the costs can be substantial. No demands, judgements, or writs appear to have been received by the company from unsecured creditors in the relation-back period. We have also noted no evidence of any undue pressure from creditors seeking payment.

6.3 Uncommercial Transactions

Our initial investigations have identified one (1) payment totaling $50,000 from the Company to a related party of Mr and Ms James made during the relation back period which may constitute an uncommercial transaction. Further investigations will be required by the Liquidator to determine if this transaction is recoverable.

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6.4 Unreasonable Director Related Transactions

We have identified three (3) transactions totaling $49,127.64 made on the date of our appointment to a related party of the director. Further transactions totaling $292,052.88 have been identified in the month leading up to our appointment. We are yet to determine if these transactions constitute unreasonable director related transactions. Further investigations will be undertaken by the liquidator should creditors resolve to place the Company in liquidation.

6.5 Unfair Loans

We have not identified any loans which may be considered unfair loans to the Company recoverable by a liquidator. We refer to our comments at section 5.9 wherein we note Ms James’ loan account owing to the Company was reduced by $431,283 in the 2018 financial year. This loan reduction requires further investigation.

6.6 Recovery action to be taken

Before any action can be taken by a liquidator the following matters will be given consideration:

• the likely costs associated with taking further action; • the assets available in the administration to fund any action; • alternative sources of funding; • the financial ability of the defending party to settle any claim; and • the extent and reliability of the books and records of the Company and/or other

information available to support the claim.

If any creditor is aware of matters relating to the past dealings of the Company that may assist the Administrators’ investigations or should any creditor wish to discuss the possibility of funding further detailed investigations please contact this office via the email address bestjetgroup@piotpartners.com.au

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Section | SEVEN

7. OFFENCES AND INSOLVENT TRADING

7.1 Attached at Annexure F is an information sheet prepared by ARITA which provides a summary of offences, recoverable transactions and insolvent trading.

7.2 De Facto/Shadow Director

We believe that Mr Michael James may have acted as a de facto or shadow director of the Company. We have formed this position based on the following reasons:

• Mr James, although not appointed as director or officer, acted in the position of a director or officer;

• Mr James was a signatory on the Company’s bank accounts up to 20 November 2018. Mr James also had transactional payment rights on the Company’s accounts.

• The director has advised that Mr James managed the day-to-day business of the Company and his role was ‘General Manager’. He has also advised that Mr James’ duties were outside the scope of a ‘fares and pricing analyst”, and included manager of all contracts/administration, staff management, payroll, recruitment and external audit liaison.

• The director has advised that Mr James holds the Company’s records. We note that Mr James has denied this allegation.

• There is evidence of Mr James’ employing the Financial Controller. • Mr James has advised that certain related party transactions were approved the day

before our appointment. Mr James appears to be privy to financial transactions that occurred in the days leading up to the voluntary administration.

• Mr James is a director of OTALab PTe Ltd a related entity which appeared to charge the Company a fee for the operation a Philippines call centre that appears to have been utilised by the Company;

• Former employees have indicated that Mr James was involved in the day to day management of the Company.

A de facto or shadow director holds the same duties and obligations as an appointed director under the Act.

A Liquidator would need to conduct further investigations to substantiate the above and may also pursue a de facto or shadow director personally in the event the Company was trading whilst insolvent (refer section 7.4 of this report).

A timeline of events in relation to Mr James is as follows: Date Event 13 September 2013 Mr James became bankrupt pursuant to a debtor’s petition. 22 November 2013 ASIC banned Mr James from managing corporation for a period

of three years (up until 21 November 2016)

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Date Event Between November 2013 and December 2015

Mr James was employed by the Company as a “fares and pricing analyst” (per a judgement issued in the Supreme Court of Australia).

14 September 2016 Mr James was discharged from bankruptcy. 21 November 2016 ASIC’s banning on Mr James for managing corporations is

lifted.

7.3 Offences

We have reviewed the books and records and affairs of the Company to determine whether a past or present officer of the company may have been guilty of an offence in relation to the Company. Our investigations have revealed that the director, former director and de facto/shadow director may have breached their obligations to act in good faith and in the best interests of the Company pursuant to section 180 and 181 of the Act.

The Administrators have completed and lodged with the ASIC a report which outlines the offences that may have been committed. As previously advised, the Administrators have also reported Mr and Ms James’ to ASIC for failing to provide information in relation to the Company’s affairs.

Further investigations will be undertaken should the creditors resolve to place the Company in liquidation. A liquidator may take action against the persons identified as breaching their duties for any loss caused to the Company or recovery of any benefit obtained at the expense of the Company.

7.4 Possible insolvent trading

A director has a duty to prevent insolvent trading by the Company. If it is proven that a director (or a de facto or shadow director) is guilty of an offence it may be possible for a Liquidator to recover from the director an amount equal to the loss or damage suffered by the Company.

Based on our discussions with the directors, together with our initial investigations into Company’s affairs, it would appear that the Company may have been trading whilst insolvent from early December 2018. Creditors should note that the test for insolvency is not a balance sheet test but rather a cash flow test. A Company is considered to be solvent if, and only if, the Company is able to pay its debts as and when they become due and payable. A Company that is not solvent is insolvent. We consider the availability of rebates from Bestjet Singapore to be critical to any assessment as to insolvent trading.

In the event that a liquidator may have an action against the director for insolvent trading, consideration must be given as to costs associated with taking such action and whether the directors have the ability to satisfy any judgement obtained.

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Significant further investigation by a Liquidator is required prior to being in a position to determine whether an action exists and whether that action would lead to any benefit for the Company’s creditors.

7.5 Recovery from director

From a commercial perspective, any recovery action contemplated by the Company should take into account whether the defending party has the capacity to pay or sufficient assets, which may realise adequate funds.

In order to recover funds from the Company’s director, bankruptcy or liquidation proceedings may need to be undertaken.

Apart from personal assets, a trustee in bankruptcy would also be entitled to contributions from income if the relevant threshold amounts were exceeded by the bankrupt’s income during a period of bankruptcy. Queensland land title searches have revealed:

• Mr McVicker does not currently own any real property; • Ms James solely owns one unencumbered property;

In the event that a Liquidator considers taking action, including recovery from the director, further enquires will be made into their personal financial position.

7.6 Public Examination

In the event the Company enters liquidation, the Liquidators will consider the conduct of a Public Examination of relevant persons in order to obtain further details and, books and records in relation to the Company’s affairs. Some parties identified as being of interest include:

• The current director, Mr McVicker; • The former director, Ms James; • Mr James; • Former employees of the Company; and • Certain creditors of the Company.

Consideration will be given to the likely costs involved and potential recoveries for the benefit of creditors.

The information uncovered by a liquidator in the public examination process may assist in recovering the uncommercial transactions, unfair preferences and any claims for insolvent trading or breach of directors’ duties.

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Section | EIGHT 8. GENERAL CUSTOMER INFORMATION 8.1 Is my flight valid?

Customers who have booked with the Company should follow the below steps: 1) Contact the airline to confirm the status of your booking. The Administrators are

unable to confirm the status of any bookings. If your booking has not been confirmed, you have not received an Eticket or your ticket has been cancelled, please proceed to step 2.

2) Contact your financial institution or travel insurance provider and request a refund for

your booking.

a. If you receive a refund from your financial institution or travel insurance provider you may no longer be a creditor of the Company. You must advise the Administrators should you receive a refund. Upon doing so, no further action is required from you.

b. If your financial institution and travel insurance provider will not refund you the amount, please proceed to step 3.

3) You may rank as an unsecured creditor of the Company. Please complete the Proof of

Debt or claim form (Form 535) located at Appendix B along with supporting documentation and return it to bestjetgroup@pilotpartners.com.au. If you have previously submitted a Form 535 we do not require anything further from you. You will receive all future updates and correspondence regarding the administration.

8.2 Refunds or Changes to Bookings/itineraries

The Administrators are unable to:

1) issue any refunds, regardless of the time they were requested and/or processed.

2) refund or honour any tickets not honoured by the Airlines.

3) facilitate any changes to bookings/itineraries. Please contact the Airlines directly. CVFR has issued the following advice to customers: “is advising all passengers to check with the airlines to confirm if their ticket is valid. If the ticket is valid there will be no change to the ticket status by CVFR. For any date changes or ticket amendments they will need to contact the airline directly as Bestjet is their agent and obviously being in administration it can no longer amend tickets.”

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8.3 Frequently Asked Questions Our Frequently asked questions can be found here: https://www.pilotpartners.com.au/bestjet-frequently-asked-questions/

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Section | NINE

9. COSTS OF THE ADMINISTRATION

9.1 Attached as Appendix G is a detailed report on the Administrators’ remuneration, called a Remuneration Approval Report. The Administrators are unable to pay the Administrators’ remuneration without approval of creditors or the Court.

9.2 We propose to have the following Administrators’ remuneration and disbursements

approved at the forthcoming meeting of creditors: Period Amount ($)

(excluding GST) A. REMUNERATION Voluntary Administration (“VA”) Resolution C: 18 December 2018 to 20 January 2019 213,090.50 Resolution D: 21 January 2019 to finalisation 88,000.00 Total Remuneration – Voluntary Administration 301,090.50 Liquidation (if appointed) Resolution F: Commencement of liquidation to the earlier of the next meeting of creditors or 6 months

325,000.00

B. DISBURSEMENTS Resolution E: 18 December 2018 to conclusion of VA 1,500.00Resolution G: Commencement of liquidation to the earlier of the next meeting of creditors or 6 months (if appointed)

900.00

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Section | TEN

10. WHAT HAPPENS NEXT? 10.1 At the meeting of creditors to be held on the future of the Company will be decided by

resolution of the creditors. The creditors will resolve one of the following options;

• The Company executes a DOCA; or • The Company is placed into Liquidation; or • The administration ends.

10.2 The day after the meeting of creditors, we will issue a circular to all creditors on our website, advising of the outcome of the second meeting of creditors.

Appendix A

1570699.1

FORM 529 Corporations Act 2001 Subsection 439A(1)

Insolvency Practice Rules (Corporations) 2016 75-15, 75-25, 75-35, 75-40(1)

NOTICE OF SECOND MEETING OF

CREDITORS OF COMPANY UNDER ADMINISTRATION

Bestjet Travel Pty Ltd (Administrators Appointed) ACN 155 965 601

Formerly Trading as “Bestjet.com”

Notice is given that a meeting of the creditors of the Company will be held at “Avro Room” at Royal on the Park Brisbane, 152 Alice Street, Brisbane, Queensland on Thursday, 31 January 2019 at 10:30AM.

Agenda:

1) To determine whether a quorum exists; 2) To receive and discuss the report of the Administrators about the business, property,

affairs and financial circumstances of the company; 3) To receive a Statement of Administrator(s) opinion and reasons for the opinion:

(a) Whether it would be in the creditors’ interests for the company(ies) to execute a deed of company arrangement;

(b) Whether it would be in the creditors’ interests for the administration to end; or (c) Whether it would be in the creditors’ interests for the company to be wound up.

4) To receive a statement of such other information known to the administrator as will enable the creditors to make an informed decision about the matters at paragraphs 3(a)-(c);

5) To receive details of any transactions that appear to the Administrator(s) to be a voidable transaction in respect of which money, property, or other benefits may be recoverable by a liquidator under part 5.7B of the Act;

6) To receive details of any proposed deed of company arrangement; and 7) For the creditors of the Company(ies) to resolve that

(a) the Company(ies) execute a deed of company arrangement; or (b) the administration(s) should end; or (c) the Company(ies) be wound up.

8) Consider and resolve to appoint alternative company Liquidator(s) or Deed Administrators; 9) To approve the past Administrators’ remuneration; 10) To fix the future remuneration of the Administrators on a time basis in accordance with the

scale of fees to be tabled at the creditors meeting and resolve that they be empowered to draw them on a monthly basis or as required;

11) To fix the future remuneration of the Administrators of the Deed of Company Arrangement, if any, on a time basis in accordance with the scale of fees to be tabled at the creditors meeting and resolve that they be empowered to draw them on a monthly basis or as required;

12) To fix the future remuneration of the Liquidators, if any, on a time basis in accordance with the scale of fees to be tabled at the creditors meeting and resolve that they be empowered to draw them on a monthly basis or as required;

13) To consider and resolve to appoint a Committee of Creditors, and if so, who are to be the committee members;

14) If the company is wound up to consider the early destruction of books and records; 15) Questions to the Administrators and Directors; 16) Any other business; and 17) Closure of the meeting.

1570699.1

Entitlement to Vote at Creditors Meeting:

Creditors are entitled to attend and vote at the meeting if the following documents are provided to the Administrators prior to the commencement of the meeting:

• Proof of Debt (Form 535) providing particulars of the debt or claim: • Appointment of Proxy (Form 532) if the creditor wishes to appoint a representative to

attend on the creditors behalf: and • Power of Attorney if the creditor wishes to be represented at the meeting by an attorney.

Further details on a creditor’s entitlement to vote are contained in IPR 75-85 details of which are set out in note 1 below. Dated this 22nd day of January 2019 NIGEL MARKEY JOINT & SEVERAL ADMINISTRATOR www.pilotpartners.com.au Note 1: The effect of section 75-85 (entitlement to vote as creditor at meetings of creditors) is: 1) A person other than a creditor (or the creditor’s proxy or attorney) is not entitled to vote at a meeting of creditors.

2) Subject to subsections (3), (4) and (5), each creditor is entitled to vote and has one vote. 3) A person is not entitled to vote as a creditor at a meeting of creditors unless:

a) his or her debt or claim has been admitted wholly or in part by the external administrator; or b) he or she has lodged, with the person presiding at the meeting, or with the person named in the notice convening

the meeting as the person who may receive particulars of the debt or claim: (i) those particulars; or (ii) if required—a formal proof of the debt or claim.

4) A creditor must not vote in respect of: a) an unliquidated debt; or b) a contingent debt; or c) an unliquidated or a contingent claim; or d) a debt the value of which is not established;

unless a just estimate of its value has been made. 5) A creditor must not vote in respect of a debt or a claim on or secured by a bill of exchange, a promissory note or any

other negotiable instrument or security held by the creditor unless he or she is willing to do the following: a) treat the liability to him or her on the instrument or security of a person covered by subsection (6) as a security in

his or her hands; b) estimate its value; c) for the purposes of voting (but not for the purposes of dividend), to deduct it from his or her debt or claim.

6) A person is covered by this subsection if:

a) the person’s liability is a debt or a claim on, or secured by, a bill of exchange, a promissory note or any other negotiable instrument or security held by the creditor; and

b) the person is either liable to the company directly, or may be liable to the company on the default of another person with respect to the liability; and

c) the person is not an insolvent under administration or a person against whom a winding up order is in force.

Appendix B

1549958.1

Australian Company Number: 155 965 601 Formerly Trading as “Bestjet.com”

Subregulation 5.6.49(2) FORM 535

Corporations Act 2001 FORMAL PROOF OF DEBT OR CLAIM

(GENERAL FORM) To the Administrators of Bestjet Travel Pty Ltd (Administrators Appointed) 1. This is to state that the company was on 18 December 2018, and still is, justly and truly indebted

to …………………………………………………………… for $………………………….. and ……………………. cents.

Date Consideration (state how the

debt rose)

Amount

$ c

Remarks (include details of voucher substantiating payment)

2. To our knowledge or belief the creditor has not, nor has any person by the creditor's order, had or

received any satisfaction or security for the sum or any part of it except for the following:

Date Drawer Acceptor $ c

Amount Due Date

*3. We are employed by the creditor and authorised in writing by the creditor to make this statement.

We know that the debt was incurred for the consideration stated and that the debt, to the best of my knowledge and belief, remains unpaid and unsatisfied.

*3. We are the creditor's agent authorised in writing to make this statement in writing. We know that

the debt was incurred for the consideration stated and that the debt, to the best of our knowledge and belief, remains unpaid and unsatisfied.

I have attached the following documents (tick as many as appropriate):

Invoices Letters of Demand Guarantee from company Monthly Statements Orders from company Credit Application Judgement from Court Statutory Demand Other documents

Dated day of 20 . Signature __________________________

Name __________________________

Occupation __________________________

Address __________________________

Phone __________________________

Email __________________________

*Do not complete if this proof is made by the creditor personally.

Appendix C

1568149_1

APPOINTMENT OF PROXY

Insolvency Practice Rules, 75-25 Corporations Act 2001

BESTJET TRAVEL PTY LTD (ADMINISTRATORS APPOINTED)

ACN: 155 965 601 FORMERLY TRADING AS “BESTJET.COM”

1. Appointment of Proxy I/We ………………………..…………………………………………………………………..……………………………………...… (name)

of ………………….………………………………………………………………………………………. (company/entity if applicable)

of …………………………………………………………………………………………………………….…………………………… (address),

a creditor of Bestjet Travel Pty Ltd (Administrators Appointed) appoint

……………………………………………………………..…..… (name of proxy) or in his/her absence

………………………………………….….………………. (alternate proxy if applicable) as my/our proxy to vote at the

meeting of creditors to be held on Thursday, 31 January 2019 at 10.30am or at any

adjournment of that meeting.

Appointment of Proxy 2. Voting Directions Please tick one:

General proxy – proceed to 3. Signature.

Special proxy – please complete the table below by voting with a tick. Proposed Resolutions For Against AbstainA. The company be placed into liquidation

“That the company be wound up and that Mr Nigel Markey and Mr Bradley Hellen be appointed joint and several Liquidators."

B. Committee of Inspection (“COI”) "That a Committee of Inspection be formed and the Committee of Inspection be authorised to approve the future fees of the joint and several Liquidators.” Note: COI members will be determined at the meeting.

C. Administrators’ Past Remuneration “That the remuneration of the joint and several Administrators, their partners and staff be hereby approved for the period 18 December 2018 to 20 January 2019 in the sum of $213,090.50 (GST exclusive) and that the joint and several Administrators be authorised to draw their remuneration from funds available.”

1568149_1

Proposed Resolutions For Against AbstainD. Administrators’ Prospective Remuneration

“That the future remuneration of the joint and several Administrators, their partners and staff for the period 21 January 2019 to finalisation of the voluntary administration be approved to a maximum amount of $88,000.00 (GST exclusive) and that they be calculated by reference to the hourly rates set down from time to time by Pilot Partners; and such remuneration be subject to review by the Court on the application of any creditor and that the joint and several Administrators be authorised to draw their remuneration from funds available on a monthly basis or as required.”

E. Administrators’ Disbursements “That the internal disbursements (excluding disbursements recovered at cost) of the Administrators, for the period 18 December 2018 to the conclusion of the voluntary administration be approved to a maximum of $1,500.00 (excluding GST) and that it be calculated in accordance with the schedule of disbursements set out in the report to creditors dated 22 January 2019 and that the Administrators be authorised to draw the disbursements from funds available on a monthly basis or as required.”

F. Liquidator’s Prospective Remuneration (if appointed) “That the future remuneration of the joint and several Liquidators, their partners and staff from the commencement of the liquidation to the earlier of the next meeting of creditors or 6 months be approved to a maximum of $325,000.00 (excluding GST) and that they be calculated by reference to the hourly rates as detailed in the report to creditors dated 22 January 2019 and that the joint and several Liquidators be authorised to draw the remuneration from funds available on a monthly basis or as required.”

G. Liquidators’ Disbursements (if appointed) “That the internal disbursements (excluding disbursements recovered at cost) of the Liquidators, from the commencement of the liquidation to the earlier of the next meeting of creditors or 6 months be approved to a maximum of $900.00 (excluding GST) and that it be calculated in accordance with the schedule of disbursements set out in the report to creditors dated 22 January 2019 and that the Liquidators be authorised to draw the disbursements from funds available on a monthly basis or as required.”

3. Signature Dated the day of January 2019. If the creditor is an individual If the creditor is a company ………………………………………………………………….

…………………………………………………………………. Director/Company Secretary …………………………………………………………………. Print Name

1568149_1

4. Certificate of Witness This certificate is to be completed only if the person giving the proxy 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 ……………………….…………………………………………….(name) of ………………………………………………………………….

………………………………………………………………….…………………(address), 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 the day of January 2019. ........................................................ Signature of Witness ........................................................ Description ........................................................ Place of residence

Appendix D

667816.1

Declaration of Independence, Relevant Relationships and Indemnities

Bestjet Travel Pty Ltd (Administrators Appointed) (“The Company”) ACN 107 305 224

Formerly Trading as “Bestjet.com”

Practitioner(s) appointed to an insolvent entity are required to make declarations as to:

A. their independence generally;

B. relationships, including the circumstances of the appointment; any relationships with the Company and others within the previous 24 months; any prior professional services for the Company within the previous 24 months; that there are no other relationships to declare; and

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

This declaration is made in respect of us, our partners and our firm, Pilot Partners. A. Independence

We, Mr Nigel Robert Markey and Mr Bradley Vincent Hellen, of Pilot Partners, Level 10, 1 Eagle Street, Brisbane, Queensland 4000 have undertaken a proper assessment of the risks to our independence prior to accepting the appointment as Administrators of the Company. 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 This appointment was referred to us by Mr Paul Betros of HopgoodGanim, the solicitor of the Company. Mr Nigel Markey and Mr Cameron Woodcroft of our office had a meeting with Mr Betros and the Company’s director, Mr Robert McVicker, on 18 December 2018 for the purposes of providing advice on the insolvency process and a consent to act.

The Courts and the ARITA’s Code of Professional Practice specifically recognise the need for practitioners to provide advice on the insolvency process and the options available and do not consider that such advice results in a conflict or is an impediment to accepting our appointment;

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

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

The referrer refers insolvency-related engagements to Pilot Partners from time to time. Neither we nor our Firm have any formal or informal referral arrangements with them and to our knowledge they do not refer work exclusively to us or our Firm.

Networks of referrals between professionals are normal and acceptable arrangements and do not affect our ability to fully comply with the statutory and fiduciary obligations associated with the administration of the company in an objective and impartial manner.

667816.1

The referral is not conditional upon the giving or receiving of commissions, fees or other benefits.

We have not provided any information or advice to the director(s) regarding the company, prior to our appointment, beyond that which we have outlined in this Declaration of Independence, Relevant Relationships and Indemnities (“DIRRI”). ii. Relevant Relationships (Excluding Professional Services to the Insolvent) We, or a member of our firm, have, or have had within the preceding 24 months, a relationship with: Name Nature of

Relationship Reasons

Wynyard Travel Pty Limited (“Wynyard”) (related entity)

We were appointed Administrators of Wynyard on the same day as our appointment as Administrators of the Company. Wynyard is a wholly owned subsidiary of Brooklyn Travel Pty Ltd.

We believe that this relationship does not result in a conflict of interest or duty because:

Except as disclosed in this DIRRI, neither We, nor a member of our firm, have had contact with the officers or any entities associated with the officers prior to our appointment of the companies. The nature of the business operations mean that the administrations can be conducted more efficiently by the same practitioners. Our role as Administrators of BestJet will not influence our ability to be able to fully comply with the statutory and fiduciary obligations associated with the administration of the Company in an objective and impartial manner.

At the time of our appointment, we were not aware of any conflicts of interest between the two companies. Should such a conflict arise, we will keep creditors informed and take appropriate action to resolve the conflict.

Brooklyn Travel Pty Ltd (“Brooklyn”) (related entity)

We were appointed Administrators of Brooklyn on the same day as our appointment as Administrators of the Company. Brookly is a wholly owned subsidiary of Bestjet Travel Pty Ltd.

We believe that this relationship does not result in a conflict of interest or duty because:

Except as disclosed in this DIRRI, neither we, nor a member of our firm, have had contact with the officers or any entities associated with the officers prior to our appointment of the companies. The nature of the business operations mean that the administrations can be conducted more efficiently by the same practitioners. Our role as Administrators of Brooklyn will not influence our ability to be able to fully comply with the statutory and fiduciary obligations associated with the administration of the Company in an objective and impartial manner.

At the time of our appointment, we were not aware of any conflicts of interest between the two companies. Should such a conflict arise, we will keep creditors informed and take appropriate action to resolve the conflict.

iii. Prior Professional Services to the Insolvent

Neither we, 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 security over the whole or substantially whole of the Company’s property that should be disclosed.

667816.1

C. Indemnities and Up-front Payments

We have not been indemnified in relation to this administration, other than any indemnities that we may be entitled to under statute. We have not received any up-front payments in respect of our remuneration or disbursements. Dated: 18 December 2018 ........................................ Mr Nigel Robert Markey

....................................... Mr Bradley Vincent Hellen

Note: 1. If circumstances change, or new information is identified, We are required under the Corporations Act 2001 and 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.

2. Any relationships, indemnities or up-front payments disclosed in the DIRRI must not be such that the Practitioner is no longer independent. The purpose of components B and C of the DIRRI is to disclose relationships that, while they do not result in the Practitioner having a conflict of interest or duty, ensure that creditors are aware of those relationships and understand why the Practitioner nevertheless remains independent.

.......................... .Nigel Robereererereerereererererererereereereerererrrrrrrrrrt

................................... .............BBBBBBBBBBBBBBBBBBBBBBBBBBBBrrrarr dley Vince

Appendix E

BESTJET TRAVEL PTY LTD (ADMINISTRATORS APPOINTED)ACN 155 965 601FORMERLY TRADING AS "BESTJET.COM"

STATEMENT OF ESTIMATED POSITION

Best Case Worst Case$ $

Cash at Bank 1 3,609,858 - E-Nett Account 1 1,387 1,387 Other Third Party Payment Providers 1 Unknown UnknownDebtors Rebates/Incentives 2 Unknown - Related Party Loans 2 44,298 UnknownPlant & Equipment 3 - - Intangible Assets 4 Unknown UnknownLease Security Deposit 5 - - Recovery of Voidable Transactions 6 391,181 - Insolvent Trading 7 Unknown - Total Assets Unknown 1,387

Administrators' Remuneration (incl GST) 8 331,200 331,200 Administrators' Disbursements (incl GST) 8 7,000 7,000 Liquidators' Remuneration (incl GST) 8 357,500 275,000 Liquidators' Disbursements (incl GST) 8 12,000 10,000 Legal Fees 9 450,000 350,000 Sundry Expenses 10 60,000 10,000 Total Liabilities 1,217,700 983,200

Net Assets Unknown Nil

Unknown NilEmployee Claims 11 13,253 13,253 c / $ return to employees Unknown Nil

Unknown NilRelated Party Unsecured Creditors 12 222,438 222,438 Ordinary Unsecured Creditors 12 10,557,223 10,557,223 c / $ return to unsecured creditors Unknown Nil

Notes:123456789

10

1112

Refer to section 5.8 (note 8) of this report. Refer to section 5.8 (note 9) of this report.

Our estimate of legal fees in respect of preparing and conducting a Public Examination, securing Company records, pursuing debtors and voidable transactions, and any other matters which may include Counsel opinion on merits of available actions. Potential legal costs are difficult to estimate as they are dependent on a number of factors. Therfore these costs are only an estimate and may change once a liquidator has concluded their investigations.

Refer to section 5.8 (note 1) of this report. Refer to section 5.8 (note 2) of this report. Refer to section 5.8 (note 3) of this report. Refer to section 5.8 (note 5) of this report. Refer to section 5.8 (note 6) of this report. Refer to section 6 of this report. Refer to section 7.4 of this report. Refer to Appendix G of this report.

Liquidation

Notes

These costs include potential subscription fees to the Company's software providers. These costs may be required to obtain Company information and/or intellectual property.

LIABILITIES

Funds available for Priority Creditors

Funds available for Unsecured Creditors

ASSETS

Appendix F

Creditor Information Sheet Offences, Recoverable Transactions and Insolvent Trading

AUSTRALIAN RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION

A summary of offences under the Corporations Act that may be identified by the administrator: 180 Failure by company officers to exercise a reasonable degree of care and diligence in the exercise

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

advantage. 183 Making improper use of information acquired by virtue of the officer’s position. 184 Reckless or intentional dishonesty in failing to exercise duties in good faith for a proper purpose.

Use of position or information dishonestly to gain advantage or cause detriment. This can be a criminal offence.

198G Performing or exercising a function or power as an officer while a company is under administration. 206A Contravening a court order against taking part in the management of a corporation. 206A, B Taking part in the management of corporation while being an insolvent, for example, while

bankrupt. 206A, B 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. 209(3) Dishonest failure to observe requirements on making loans to directors or related companies. 254T Paying dividends except out of profits. 286 Failure to keep proper accounting records. 312 Obstruction of an auditor. 314-7 Failure to comply with requirements for the preparation of financial statements. 437D(5) Unauthorised dealing with company's property during administration. 438B(4) Failure by directors to assist administrator, deliver records and provide information. 438C(5) Failure to deliver up books and records to the 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.

Preferences

A preference is a transaction, such as a payment by the company to a creditor, in which the creditor receiving the payment is preferred over the general body of creditors. The relevant period for the payment commences six months before the commencement of the liquidation. The company must have been insolvent at the time of the transaction, or become insolvent because of the transaction.

Where a creditor receives a preference, 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 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.

Offences

Recoverable Transactions

AUSTRALIAN RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION PAGE 2

Version: August 2017 22143 (VA) - INFO - Offences recoverable transactions and insolvent trading v1_1.docx1

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 period is four years and if the intention of the transaction is to defeat creditors, the period is ten years.

The company must have been insolvent at the time of the transaction, or become insolvent because 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 must be entered into before 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 payments made to or on behalf of a director or close associate of a director. The transaction must have been unreasonable, and have been entered into during the 4 years leading up to a company's liquidation, regardless of its solvency at the time the transaction occurred.

Voidable charges

Certain charges over company property are voidable by a liquidator:

circulating security interest created within six months of the liquidation, unless it secures a subsequent advance;

unregistered security interests; security interests in favour of related parties who attempt to enforce the security within six months of its

creation.

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 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.

Insolvent trading

Appendix G

REMUNERATION APPROVAL REPORT Bestjet Travel Pty Limited (Administrators Appointed) ACN 155 965 601 Formerly Trading as “Bestjet.com” (“the Company”) This remuneration approval report provides you with the information you need to be able to make an informed decision regarding the approval of the Administrators’ remuneration for undertaking the administration of the abovenamed Company. What do you need to do next?

You should read this report and the other documentation that Administrators have sent you and then attend the meeting of creditors in order to voice your opinion by casting your vote on the resolutions put to the meeting. The meeting will also give you an opportunity to ask any questions that you may have. Alternatively, you are also able to appoint a representative to attend on your behalf by lodging a proxy form. Lodging a specific proxy form allows you to specify how your proxy must vote. Lodging a general proxy form allows your representative to choose how your vote is exercised. Information about the meeting of creditors is provided in our report to creditors.

This report is set out as follows: 1. Declaration 2. Executive summary 3. Remuneration 4. Disbursements 5. Summary of receipts and payments 6. Queries and information sheets 1. Declaration

We, Mr Nigel Robert Markey and Mr Bradley Vincent Hellen of Pilot Partners, have undertaken a proper assessment of this remuneration claim for our appointment as Administrators of Bestjet Travel Pty Limited (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.

2. Executive summary To date, no remuneration has been approved or drawn in this administration.

Remuneration currently claimed is summarised below:

Period Report reference

Amount ($) (excluding

GST) Current remuneration approval sought: Voluntary Administration Resolution C: 18 December 2018 to 20 January 2019 4 213,090.50Resolution D: 21 January 2019 to finalisation* 4 88,000.00Total Remuneration – Voluntary Administration * 301,090.50 Liquidation (if appointed) Resolution F: Commencement of liquidation to the earlier of the next meeting of creditors or 6 months*

4 325,000.00

* Approval for the future remuneration sought is based on an estimate of the work necessary to the completion of the voluntary administration/liquidation. Should additional work be necessary beyond what is contemplated, further approval may be sought from creditors.

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

2.2 The total remuneration for this appointment is estimated to be $301,090.50 (excluding GST).

The remuneration claimed for the period 18 December 2018 to 20 January 2019 differs from the Administrators’ estimated costs of $50,000 to $60,000 (excluding GST) as stated in our report to creditors dated 20 December 2018 for the reasons set out in section 3.3.

3. Remuneration

3.1 Remuneration Claim Resolutions

The Administrators will be seeking approval of the following resolutions to approve our remuneration. Details to support these resolutions are included in section 3.2 and in the attached Schedules. Resolution C: Administrators’ Past Remuneration “That the remuneration of the joint and several Administrators, their partners and staff be hereby approved for the period 20 December 2018 to 20 January 2019 in the sum of $213,090.50 (GST exclusive) and that the joint and several Administrators be authorised to draw their remuneration from funds available.”

Resolution D: Administrators’ Prospective Remuneration “That the future remuneration of the joint and several Administrators, their partners and staff for the period 21 January 2019 to finalisation of the voluntary administration be approved to a maximum amount of $88,000.00 (GST exclusive) and that they be calculated by reference to the hourly rates set down from time to time by Pilot Partners; and such remuneration be subject to review by the Court on the application of any creditor and that the joint and several Administrators be authorised to draw their remuneration from funds available on a monthly basis or as required.”

Should creditors resolve that the company be wound up, creditors will be asked to approve our remuneration as Liquidators and to pass the following resolution: Resolution F: Liquidators’ Prospective Remuneration (if appointed) “That the future remuneration of the joint and several Liquidators, their partners and staff from the commencement of the liquidation to the earlier of the next meeting of creditors or 6 months be approved to a maximum of $325,000.00 (excluding GST) and that they be calculated by reference to the hourly rates as detailed in the report to creditors dated 22 January 2019 and that the joint and several Liquidators be authorised to draw the remuneration from funds available on a monthly basis or as required.” The scale of rates charged by the Administrators’ firm is attached at Annexure 1 and is in accordance with the rates charged from time to time by Pilot Partners.

3.2 Details of remuneration

The tasks undertaken by the Administrators can be broadly divided into seven (7) categories as follows: ● Assets ● Employees ● Investigation ● Administration ● Creditors ● Trade On ● Dividend

Information on the above categories is summarised in the attached annexures to enable creditors to understand the type and purpose of work being undertaken: Annexure Details A1 & A2 (Voluntary Administration)

A calculation of the Administrators’ remuneration together with a summary of the type and purpose of work undertaken for the period from 18 December 2018 to 20 January 2019.

B (Voluntary Administration)

A summary of the type and purpose of future work to be undertaken by the Administrators from 21 January 2019 to finalisation of the administration.

C (Liquidation)

A summary of the type and purpose of future work to be undertaken by the Liquidators from commencement of the liquidation to the earlier of the next meeting of creditors or 6 months (if appointed).

3.3 Total remuneration reconciliation

At this point in time we estimate that the total remuneration for this administration will be approximately $302,000 (excluding GST).

This estimate differs to the estimate of costs provided in the Initial Remuneration Notice dated 20 December 2018, which estimated a cost of the administration to be between $50,000 and $60,000 (excluding GST). We make the following comments on time spent on numerous matters which have affected the Administrators’ previous remuneration estimate:

• The Administrators were unaware of the number of impacted creditors by the

administration. The Administrator has now received in excess of 4,000 individual creditor claims.

• Time spent in responding to enquiries received from the Company’s customers exceeded initial estimates. The Administrators obtained a quote from a third party to respond to these consumer enquiries and collate claim forsm. The amount quoted was well in excess of the Administrators’ costs to undertake the same task.

• The director of the Company had limited knowledge of the Company’s dealing and

affairs, as such, a significant amount of time was spent in reviewing the limited Company books and records obtained.

• Due to the limited books and records available, the Administrators have had to

make their own independent enquires and requests for information from various sources in order to provide an opinion to the creditors of the company. This includes the following:

o Liaising with the Company’s former accountants, auditors and advisors;

o Trying to gain access to the Company’s accounting and financial software,

including MYOB, Xero and Salesforce;

o Liaising with IATA, CVFR and Integrapay Pty Ltd regarding customer data; and

o Engaging solicitors to assist with gaining access to the Company’s systems

with AWS.

• On appointment, the Administrators were unaware a number of creditors may have claim over the funds held by the Administrators. This has required the Administrators to review these claims as well as engage solicitors.

The Administrators have provided an explanation of tasks remaining to be completed, including our estimated costs to complete those tasks, to support our current remuneration approval request, at section 3.2 of the report and in Annexure B.

In preparing this remuneration approval report, we have made our best estimate at what we believe the administration will cost to complete and we do not anticipate that we will have to ask creditors to approve any further remuneration. However, should the administration not proceed as expected, we will advise creditors and we may seek approval of further remuneration and provide details on why the remuneration has changed. The Administrators estimate their remuneration as Liquidators (if appointed) from the ccommencement of the liquidation to the earlier of the next meeting of creditors or 6 months to be in the vicinity of $325,000.00 (excluding GST) which will include the following tasks:

• Preparing for and conducting a Public Examination of relevant personnel to obtain information in relation to the Company’s affairs and dealings for the benefit of creditors;

• Corresponding and meeting with our lawyers throughout the ongoing administration;

• Responding to creditor enquiries; • Completing investigations into the Company’s affairs; • Secure access to all Company records, including taking necessary legal action; • Realise all Company assets; • Should it be necessary, cause the Court to determine at a trial the question as to

whether the monies held in one of the Company’s bank accounts are held on trust for one or more third parties;

• Consider voidable transactions and take any recovery action, including legal action, if considered commercial;

• Focus on related party transactions with the Company and determining their recoverability;

• Reporting to creditors; and • Any other tasks which may arise.

3.4 Likely Impact on Dividends

The disbursement of funds in an administration is subject to the provisions of the Corporations Act 2001 and the rights of secured creditors who have registered their security interest on the Personal Properties and Securities Register (PPSR). In summary the order in which funds are disbursed (subject to the claims of secured creditors) is:

• costs and expenses of the liquidation, including liquidators’ fees; • outstanding employee wages and superannuation; • outstanding employee leave of absence (including annual leave, sick leave—where

applicable—and long service leave); • employee retrenchment pay; and • unsecured creditors.

Each category is paid in full before the next category is paid. If there are insufficient funds to pay a category in full, the available funds are paid on a pro rata basis (and the next category or categories will not be paid).

The rights of secured creditors arise from the terms of their security interests.

Any dividend will ultimately be impacted by the realisations achieved in the administration and the value of creditor claims admitted to participate in the dividend. The Administrators’ remuneration for the work performed to achieve the realisations has priority payment.

4. Disbursements

Disbursements are divided into three types:

• Externally provided professional services which are recovered at cost. An example of these disbursements is legal fees.

• Externally provided non-professional costs such as travel, accommodation and

search fees. These are recovered at cost.

• Internal disbursements such as photocopying, printing and postage. These disbursements, if charged to the administration, would generally be charged at cost; though some expenses such as telephone calls, photocopying and printing may be charged at a rate which recoups both variable and fixed costs. The recovery of these costs must be on a reasonable commercial basis.

4.1 No disbursements have been paid by the administration to our firm to date.

4.2 Where amounts have been paid to the Administrators’ firm for externally provided services

and costs, those payments are in reimbursement of costs previously paid by the Administrators’ firm, either due to lack of funds in the administration at the time the payment was due, or the direct invoicing of our firm by the supplier.

4.3 Full details of disbursements on this appointment are as follows: Disbursements Rate (GST Exclusive)Archive of Administration Records $100.00 per folderASIC –IFM Levy $250 per administrationASIC - IFM Metric Levy $77 per metric eventFacsimiles $0.50 per page Photocopying $0.75 per pageTravel $0.66 per kilometerStationery At CostStorage and Destruction At CostStorage Retrieval and Refile At CostPostage (including express & registered envelopes) At Cost

*Rates applicable for financial year ending 30 June 2019

Please note that the above example of the cost of internal disbursements recovered by this firm and, as such, is not an exhaustive list of all disbursements which may be provided in connection with this administration. Further, we note that some disbursements may not be applicable in this particular administration. Please note that the above prices do not include Goods & Services Tax which is added where appropriate and are subject to change. ASIC Industry funding model (IFM) Levy

From 1 July 2017 the Australian Securities and Investment Commission (“ASIC”) introduced an industry funding model (IFM) to cover the costs of ASIC’s regulation of the professional. The IFM levy for external administrators are calculated in two parts:

• firstly a $2,500 minimum levy component per external administrator • plus a fee per metric event for the number of external administrations, certain

lodgements and Public Notices Website (“PNW”) notices. ASIC currently estimates the fee to be $77 per metric event.

The IFM levy is payable by the external administrators’ firm irrespective of the funds available in the administration. External administrators routinely undertake appointments and investigations, as required by the Corporations Act 2001, on an unfunded basis with insufficient funds in the administration to meet the external administrators’ disbursements.

We are requesting creditors approve the payments of the ASIC IFM levy at a flat fee of $250 plus $77 per metric event in the voluntary administration and liquidation (if appointed).

We are seeking approval of the following resolutions to approve the disbursements:

Resolution E: Administrators’ Disbursements “That the internal disbursements (excluding disbursements recovered at cost) of the Administrators, for the period 18 December 2018 to the conclusion of the voluntary administration be approved to a maximum of $1,500.00 (excluding GST) and that it be calculated in accordance with the schedule of disbursements set out in the report to creditors dated 22 January 2019 and that the Administrators be authorised to draw the disbursements from funds available on a monthly basis or as required.” Resolution G: Liquidator’s Disbursements (if appointed) “That the internal disbursements (excluding disbursements recovered at cost) of the Liquidators, from the commencement of the liquidation to the earlier of the next meeting of creditors or 6 months be approved to a maximum of $900.00 (excluding GST) and that it be calculated in accordance with the schedule of disbursements set out in the report to creditors dated 22 January 2019 and that the Liquidators be authorised to draw the disbursements from funds available on a monthly basis or as required.”

5. Summary of receipts and payments

5.1 A summary of the Administrators’ receipts and payments for the period 18 December 2018 to 20 January 2019 is attached as Annexure 2.

6. Queries and information sheets

6.1 Creditors should contact the Administrators’ office to seek further information concerning the remuneration claim.

6.2 You can also access information which may assist you on the following websites: • ARITA at www.arita.com.au/creditors • ASIC at www.asic.giv.au (search for “insolvency information sheets”).

Dated this 22nd day of January 2019. NIGEL MARKEY JOINT & SEVERAL ADMINISTRATOR

Annexure 1 Pilot Partners Hourly Firm Rates

We have summarised below the rates we, our partners and staff charge:

Description of Staff Member

Description of Level of Experience Rate $/Hour (Excl GST) Effective

1 March 2018

Appointee / Director Liquidator/Trustee leading the assignment with full responsibility for strategy and execution. Director of Pilot bringing his or her specialist skills to the administration.

500

Associate Director More than 10 years of experience in insolvency or a related discipline and at least 7 years at manager level. Accountable to the Appointee but otherwise capable of controlling all aspects of an administration. May be appropriately qualified to take appointments in his/her own right.

450

Senior Manager

More than 10 years of experience in insolvency or a related discipline and at least 5 years at manager level. Accountable to the Appointee but otherwise capable of controlling all aspects of an administration. May be appropriately qualified to take appointments in his/her own right.

420

Manager 1 More than 7 years experience in insolvency or a related discipline. Generally will have completed the ARITA Insolvency Education Program. Will have conduct of small to large administrations and is experienced in managing staff and workflow.

390

Manager 2 More than 5 years experience in insolvency or a related discipline. Generally will have completed the ARITA Insolvency Education Program. Will have conduct of small to large administrations and is experienced in managing staff and workflow.

350

Supervisor More than 4 years experience in insolvency or a related discipline. Generally will be CA qualified and will be undertaking the ARITA Insolvency Education Program. Will have conduct of minor administrations and capable of managing 1-3 staff and workflow. Assists in planning and control of medium to larger jobs.

295

Senior 1 More than 3 years experience in insolvency or a related discipline. Generally the CA program will be completed during this period. Assists planning and control of small to medium sized jobs as well as performing some of the more difficult work on larger jobs.

260

Senior 2 More than 2 years experience in insolvency or a related discipline. Generally the CA program will be undertaken during this period. Assists planning and control of small jobs as well as performing some of the more difficult work on larger jobs.

230

Intermediate More than 1 years experience in insolvency or a related discipline. Generally the CA program will be being undertaken during this period. Assists in day-to-day work under supervision of more senior staff.

200

Accountant Generally a Graduate with limited or no professional or insolvency experience. Generally the CA program will be commenced in this period. Assists in day-to-day work under supervision of more senior staff.

185

Undergraduate Generally an undergraduate who plans to undertake relevant study at least on a part-time basis. Assists in day-to-day work under supervision of more senior staff.

160

Administrator Appropriately experienced support staff undertaking functions such as IT support, secretarial support, use of computer applications, books and records management and maintaining banking and accounting records on administrations.

160

Junior Appropriately experienced support staff undertaking functions such as secretarial support.

100

The hourly rates used by us and the partners and staff of Pilot Partners reflect our own particular cost structure, the risks associated with the work undertaken and the type of administration being carried on by us. Our scale of hourly rates recognise the nature of the work, the extent and urgency of the work, the degree of skill required and the degree of responsibility undertaken.

Our firm rates change from time to time (usually annually) to reflect increased costs of operating.

Annexure 2

Bestjet Travel Pty Ltd (Administrators Appointed) ACN 155 965 601

Summary of Receipts and Payments For the period 18 December 2018 to 20 January 2019

Amount ($)

RECEIPTS Pre-Appointment Cash at Bank 3,609,858.59 Interest Income 1,413.46

3,611,272.05 PAYMENTS

Software Data Extraction Fees (5,280.00) (5,280.00)

Net Receipts and Payments 3,605,992.05

REPRESENTED BY

Cash at Bank 3,605,992.05

Annexure A1

Bestjet Travel Pty Ltd (Administrators Appointed) ACN 155 965 601 (“the Company”) Calculation of the Administrators’ remuneration for the period from 18 December 2018 to 20 January 2018.

Position Staff Rate Total Hrs

Total Value Assets Employees Creditors Administration Investigation

$ $ Hrs $ Hrs $ Hrs $ Hrs $ Hrs

Director Hellen Bradley 500.00 5.30 2,650.00 2,650.00 5.30

Director Hellen Bradley 500.00 2.20 1,100.00 1,100.00 2.20

Director Markey Nigel 500.00 88.00 44,000.00 1,700.00 3.40 400.00 0.80 14,150.00 28.30 650.00 1.30 27,100.00 54.20

Director Markey Nigel 500.00 0.30 150.00 100.00 0.20 50.00 0.10

Associate Director Leeuwendal Jane 450.00 0.50 225.00 225.00 0.50

Manager 1 Ku Elizabeth 390.00 11.90 4,641.00 4,407.00 11.30 195.00 0.50 39.00 0.10

Intermediate Ku Elizabeth 200.00 19.30 3,860.00 3,860.00 19.30

Manager 1 Woodcroft Cameron

390.00 136.40 53,196.00 2,964.00 7.60 351.00 0.90 22,620.00 58.00 2,106.00 5.40 25,155.00 64.50

Senior 1 Hatchman Demi 260.00 101.70 26,442.00 598.00 2.30 26.00 0.10 16,978.00 65.30 1,066.00 4.10 7,774.00 29.90

Intermediate Stubbings Benjamin

200.00 109.80 21,960.00 320.00 1.60 120.00 0.60 17,980.00 89.90 400.00 2.00 3,140.00 15.70

Accountant Nguyen Andy 185.00 145.20 26,862.00 795.50 4.30 55.50 0.30 23,883.50 129.10 777.00 4.20 1,350.50 7.30

Accountant Thomasson Daniel

185.00 16.10 2,978.50 2,978.50 16.10

Accountant Truong Stephanie 185.00 8.40 1,554.00 1,554.00 8.40

Undergraduate McLay Grace 160.00 27.10 4,336.00 4,336.00 27.10

Undergraduate Phillips Sheree 160.00 2.30 368.00 368.00 2.30

Undergraduate Varcados Joanne 160.00 17.10 2,736.00 2,736.00 17.10

Administrator Dyett Elizabeth 160.00 9.80 1,568.00 96.00 0.60 48.00 0.30 272.00 1.70 384.00 2.40 768.00 4.80

Undergraduate Foreman Miranda 160.00 0.40 64.00 64.00 0.40

Junior Howlett Lauren 100.00 25.00 2,500.00 2,500.00 25.00

Junior Howlett Sarah 100.00 35.00 3,500.00 3,500.00 35.00

Intermediate Yang Linda 200.00 42.00 8,400.00 8,400.00 42.00

Total 803.80 213,090.50 6,473.50 19.80 1,000.50 3.00 130,623.00 576.10 9,328.00 27.40 65,665.50 177.50 GST 21,309.05 647.35 100.05 13,062.30 932.80 6,566.55 TOTAL (including GST) 234,399.55 7,120.85 1,100.55 143,685.30 10,260.80 72,232.05 Average Hourly Rate (GST Inclusive) 291.61 359.64 366.85 249.41 374.48 406.94

Annexure A2 Bestjet Travel Pty Limited (Administrators Appointed) ACN 155 965 601 Formerly Trading as “Bestjet” (“the Company”) Summary of the type and purpose of work undertaken for the period from 18 December 2018 to 20 January 2019 Task Area Description Includes

Assets 19.80 Hours $6,473.50

Plant and Equipment Investigating company equipment

Debtors Reviewing debtor reports provided by director Issuing debtor demands

Other Assets Tasks associated with realising other assets Liaising with interested parties regarding Company’s intangible assets

Leasing Reviewing leasing documents Liaising with owners/lessors Tasks associated with disclaiming leases

Insurance Correspondence with insurer regarding initial insurance requirements Reviewing insurance policies Correspondence with previous brokers

Creditors 576.10 Hours $130,623.00

Creditor Enquiries Requests & Directions

Receive and follow up creditor enquiries via telephone and email Maintaining creditor enquiry register Review and prepare correspondence to creditors and their representatives via facsimile, email and post Correspondence with committee of creditors members Considering reasonableness of creditor requests Obtaining legal advice on requests Documenting reasons for complying or not complying with requests or directions Compiling information requested by creditors

Creditor reports Preparing voluntary administrators report, investigation, meeting and general reports to creditors

Dealing with proofs of debt Receipting and filing POD’s when not related to a dividend Corresponding with OSR and ATO regarding POD’s when not related to a dividend

Meeting of Creditors Preparation meeting notices, proxies and advertisements Forward notice of meeting to all known creditors Preparation of meeting file, including agenda, certificate of postage, attendance register, list of creditors, reports to creditors, advertisement of meeting and draft minutes of meeting. Preparation and lodgement minutes of meetings with ASIC Respond to stakeholder queries and questions immediately following meeting

Employees 3.00 Hours $1,000.50

Employees enquiries

Receive and follow up employee enquiries via telephone and email Maintain employee enquiry register Review and prepare correspondence to creditors and their representatives via facsimile, email and post

Task Area Description Includes Preparation of letters to employees advising of their and options available

Calculation of entitlements Reviewing employee files and company’s books and records Other employee issues Correspondence with Child Support

Correspondence with Centrelink

Investigation 177.50 Hours $65,665.50

Conducting investigations Collection of company books and records Meeting with director and advisors Correspondence to director and advisors Correspondence with ASIC to receive assistance in obtaining, company’s books & records and Report on Company Activities & Property Reconstruction of financial statements Reviewing books and records Review and preparation of company nature and history Conducting and summarising statutory searches Preparation of comparative financial statements Preparation of deficiency statement Review of specific transactions and liaising with director regarding certain transactions Preparation of investigation file Lodgement of investigation with the ASIC Liaising with relevant personal regarding access to the Company’s MYOB file, Xero and Salesforce Investigating third party payment providers Investigating voidable transactions Investigating insolvent trading

Litigation/Recoveries Liaising/correspondence with solicitors regarding recovery actions

ASIC reporting

Preparing statutory investigation reports Preparing affidavits seeking non lodgements assistance Liaising with ASIC Correspondence to ATO, ASIC

Administration 27.40 Hours $9,328.00

Correspondence Other correspondences not specific to other milestones

Document maintenance/file review/checklist

Administration reviews Filing of documents File reviews Updating checklists

ASIC Form 524 and other forms

Statutory Lodgements Preparing and lodging ASIC forms Correspondence with ASIC regarding statutory forms

Bank account administration

Preparing correspondence opening and closing accounts Requesting bank statements Bank account reconciliations Correspondence with bank regarding specific transfers

Planning and review Discussions regarding status of administration Books and records / storage

Dealing with records in storage Sending job files to storage

ATO and other statutory reporting

Notification of appointment

Total 803.80 Hours $213,090.50 (excluding GST)

Annexure B Bestjet Travel Pty Limited (Administrators Appointed) ACN 155 965 601 Formerly Trading as “Bestjet.com” (“the Company”) Summary of the type and purpose of work undertaken for the period from 21 January 2019 to the finalisation of the Administration Task Area Description Includes

Assets $10,000.00

Debtors Correspondence with debtors Reviewing and assessing debtors ledgers

Other Assets Tasks associated with realising other assets

Creditors $38,000.00

Creditor Enquiries Requests & Directions

Receive and follow up creditor enquiries via telephone and email Maintaining creditor enquiry register Review and prepare correspondence to creditors and their representatives via facsimile, email and post Correspondence with committee of creditors members Considering reasonableness of creditor requests Obtaining legal advice on requests Documenting reasons for complying or not complying with requests or directions Compiling information requested by creditors

Creditor reports Preparing voluntary administrators report, investigation, meeting and general reports to creditors

Dealing with proofs of debt Receipting and filing POD’s when not related to a dividend Corresponding with OSR and ATO regarding POD’s when not related to a dividend

Meeting of Creditors Preparation meeting notices, proxies and advertisements Forward notice of meeting to all known creditors Preparation of meeting file, including agenda, certificate of postage, attendance register, list of creditors, reports to creditors, advertisement of meeting and draft minutes of meeting. Preparation and lodgement minutes of meetings with ASIC Respond to stakeholder queries and questions immediately following meeting

Employees 5,000.00

Employees enquiries

Receive and follow up employee enquiries via telephone and email Maintain employee enquiry register Review and prepare correspondence to creditors and their representatives via facsimile, email and post Preparation of letters to employees advising of their entitlements and options available Receive and prepare correspondence in response to employees objections to leave entitlements

Calculation of entitlements Reviewing employee files and company’s books and records Other employee issues Correspondence with Child Support

Correspondence with Centrelink

Task Area Description Includes

Investigation 25,000.00

Conducting investigations Collection of company books and records Meeting with director and advisors, as required Correspondence to director and advisors, as required Reconstruction of financial statements Reviewing books and records Review and preparation of company nature and history Review of specific transactions Continuing to liaise with relevant parties to gain access to Xero and Salesforce Investigating possible shadow/de facto director Any other investigations that may arise

Litigation/Recoveries Liaising/correspondence with solicitors regarding recovery actions

ASIC reporting

Preparing statutory investigation reports Liaising with ASIC Correspondence to ATO, ASIC

Administration $10,000.00

Correspondence Other correspondences not specific to other milestones

Document maintenance/file review/checklist

Administration review Filing of documents File reviews Updating checklists

ASIC Form 524 and other forms

Statutory Lodgements Preparing and lodging ASIC forms Correspondence with ASIC regarding statutory forms

Bank account administration

Preparing correspondence opening and closing accounts Requesting bank statements Bank account reconciliations Correspondence with bank regarding specific transfers

Finalisation Notifying ATO of finalisation Completing checklists Finalising WIP

Planning and review Discussions regarding status of administration Books and records / storage

Dealing with records in storage Sending job files to storage

ATO and other statutory reporting

Preparing BAS

Total $88,000.00 (excluding GST)

Annexure C Bestjet Travel Pty Limited (Administrators Appointed) ACN 155 965 601 Formerly Trading as “Bestjet.com” (“the Company”) Summary of the type and purpose of work undertaken for the period from commencement of the liquidation to the earlier of the next meeting of creditors or 6 months (if appointed) Task Area Description Includes

Assets $75,000.00

Debtors Correspondence with debtors Reviewing and assessing debtors ledgers Liaising with debt collectors and solicitors (if required)

Other Assets Tasks associated with realising other assets Tasks associated with intangible assets

Creditors $55,000.00

Creditor Enquiries Requests & Directions

Receive and follow up creditor enquiries via telephone and email Maintaining creditor enquiry register Review and prepare correspondence to creditors and their representatives via facsimile, email and post Correspondence with committee of creditors members Considering reasonableness of creditor requests Obtaining legal advice on requests Documenting reasons for complying or not complying with requests or directions Compiling information requested by creditors

Creditor reports Preparing Statutory Report by Liquidator, investigation, meeting and general reports to creditors

Dealing with proofs of debt Receipting and filing POD’s when not related to a dividend Corresponding with OSR and ATO regarding POD’s when not related to a dividend

Meeting of Creditors Preparation meeting notices, proxies and advertisements Forward notice of meeting to all known creditors Preparation of meeting file, including agenda, certificate of postage, attendance register, list of creditors, reports to creditors, advertisement of meeting and draft minutes of meeting. Preparation and lodgement minutes of meetings with ASIC Respond to stakeholder queries and questions immediately following meeting

Proposals to Creditors Preparing proposal notices and voting forms Forward notice of proposal to all known creditors Reviewing votes and determining outcome of proposal Preparation and lodgement of proposal outcome with ASIC

Employees $15,000.00

Employees enquiries

Receive and follow up employee enquiries via telephone and email Maintain employee enquiry register Review and prepare correspondence to creditors and their representatives via facsimile, email and post Preparation of letters to employees advising of their entitlements and options available Receive and prepare correspondence in response to employees objections to leave entitlements

FEG Correspondence with FEG Preparing notification spreadsheet

Task Area Description Includes Preparing FEG quotations Preparing FEG distributions Completing FEG questionnaires

Calculation of entitlements Calculating employee entitlements Reviewing employee files and company’s books and records Reconciling superannuation accounts Reviewing awards Liaising with solicitors regarding entitlements

Workers compensation claims

Review insurance policies Receipt of claim Liaising with claimant Liaising with insurers and solicitors regarding claims Identification of potential issues requiring attention of insurance specialists Correspondence with Arthur J Gallagher regarding initial and ongoing workers compensation insurance requirements Correspondence with previous brokers

Other employee issues Correspondence with Child Support Correspondence with Centrelink

Investigation $160,000.00

Conducting investigations Collection of company books and records Meeting with director and advisors, as required Correspondence to director and advisors, as required Correspondence with ASIC to receive assistance in obtaining company’s books & records Reconstruction of financial statements Reviewing books and records Review of specific transactions and liaising with director regarding certain transactions Preparation of investigation file Lodgement of investigation with the ASIC Preparation and lodgement of supplementary report if required Investigating voidable transactions Investigating insolvent trading Investigating director offences

Examinations (if required) Preparing brief to solicitor Liaising with solicitor(s) regarding examinations Attendance at examination Reviewing examination transcripts Liaising with solicitor(s) regarding outcome of examinations and further actions available

Litigation/Recoveries Internal meetings to discuss status of litigation Preparing brief to solicitors Liaising/correspondence with solicitors regarding recovery actions Attending to negotiations Attending to settlement matters

ASIC reporting

Preparing statutory investigation reports Preparing affidavits seeking non lodgements assistance Liaising with ASIC Correspondence to ATO, ASIC

Administration $20,000.00

Correspondence Other correspondences not specific to other milestones

Document maintenance/file review/checklist

Administration reviews Filing of documents File reviews Updating checklists

Task Area Description Includes ASIC Form 524 and other forms

Statutory Lodgements Preparing and lodging ASIC forms Correspondence with ASIC regarding statutory forms

Bank account administration

Preparing correspondence opening and closing accounts Requesting bank statements Bank account reconciliations Correspondence with bank regarding specific transfers

Planning and review Discussions regarding status of administration Books and records / storage

Dealing with records in storage Sending job files to storage

ATO and other statutory reporting

Notification of appointment Preparing BAS Completing group certificates or PAYG Annual returns (if required)

Total $325,000.00 (excluding GST)