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Notice to Consult in Terms of Section 150(1)
Comair Limited
(Incorporated in the Republic of South Africa)
(Registration Number: 1967/006783/06)
ISIN: ZAE00002983
Share Code: COM
(“Comair” or “the Company”)
NOTICE TO CONSULT IN TERMS OF SECTION 150(1)
Shareholders are referred to the announcements issued on SENS on 5 May 2020 and 8 May
2020 wherein they were advised that Comair was placed in business rescue, and that
Messrs Shaun Collyer and Richard Ferguson were appointed as the business rescue
practitioners of Comair.
Shareholders were previously advised that, as a result of the travel restrictions under the
national lockdown and because of the prolonged effects of the nationwide lockdown, it has
become impossible for Comair to resume operations and re-commence domestic air travel
until the Company is sufficiently capitalised.
In this regard, the key elements envisioned for Comair's business rescue plan are the
following:
- It is intended that the business rescue plan, as contemplated in section 128(1)(b)(iii) of the
Companies Act 71 of 2008 ("the Companies Act"), will rescue Comair by restructuring its
affairs, business, property, debt and other liabilities;
- It is intended that the business rescue plan of Comair will, inter alia,:
- be partly informed by the independent calculation of the liquidation dividend
("Liquidation Dividend") the creditors would receive if Comair were to be placed into
liquidation (section 150(2)(a)(iii) of the Companies Act); and
- provide that its creditors will receive a better distribution than the Liquidation
Dividend together with a conversion of debt to equity , and that Comair will be
released from payment of its debts in order for Comair to continue in existence on
a solvent basis (sections 128(1)(b)(iii) read with 150(2)(b)(ii));
- It is intended to continue to keep Comair's aircraft fleet under preservation storage. Comair
intends to resume domestic passenger air travel on 1 November 2020, provided that
unrestricted domestic air travel is commercially viable by that time and that Comair will have
sufficient funding to re-commence operations;
- Reducing Comair's operational aircraft fleet by 50%;
- Continuing with the retrenchment processes, as a reduced aircraft fleet will reduce
Comair's operational requirements;
- Renegotiating and/or refinancing the aircraft finance and lease agreements;
- Identifying which of Comair's assets should be disposed of, and proceeding with the sale of
those assets (some of them, as going concerns);
- Recapitalization of the Company by: :
- issuing Comair's authorised ordinary or preferred shares, as appropriate, to an
investor(s) at a price to be determined by the business rescue practitioners in
terms of section 152(6)(a) of the Companies Act, subject to the approval of
shareholders in terms of section 152(3)(c)(ii) of the Companies Act and the
approval of JSE Limited to the extent that it may be required; and
- if necessary, amending Comair's memorandum of incorporation in order to
authorise, and determine the preferences, rights, limitations and other terms of
any securities that are not otherwise authorised, for issue at a price to be
determined by the business rescue practitioners in terms of section 152(6)(b)
of the Companies Act, subject to the approval of shareholders in terms of
section 152(3)(c)(ii) of the Companies Act and the approval of the JSE Limited
to the extent that it may be required.
- If Comair is able to successfully raise such equity capital, the current shareholders will be
substantially diluted;
- It is intended that Creditors (including employees with claims against Comair) will:
be paid a distribution, higher than the probable Liquidation Dividend, in terms of the waterfall
of payments contemplated in sections 135 and 144(2) of the Companies Act, through a
combination of:
- the proceeds from the sale of those assets that have been identified for sale,
- any equity capital raised as aforesaid; and/or
-the issuing of shares in Comair,
- be compromised, with Comair being released from its indebtedness as such, and no
Creditor will be entitled to enforce any balance of any Creditors' claim against Comair.
The business rescue practitioners are open to receiving any constructive questions,
comments and suggestions from Comair's shareholders on these key elements by close of
business on 9 June 2020 by email at brpcomments@comair.co.za.
Bonaero Park
5 June 2020
Sponsor
PSG Capital
IMPORTANT NOTICE TO FOREIGN SHAREHOLDERS AND PROSPECTIVE INVESTORS
FOREIGN SHAREHOLDERS AND PROSPECTIVE INVESTORS IN COMAIR LIMITED (“COMAIR”) SHOULD
NOTE THAT, IN ORDER TO ENABLE COMAIR (AS A LICENSED AIR SERVICES OPERATOR IN SOUTH
AFRICA) TO REMAIN COMPLIANT WITH THE FOREIGN OWNERSHIP RESTRICTION CONTAINED
SECTIONS 16(4)(c) AND 19(a) OF THE AIR SERVICES LICENSING ACT, NO. 115 OF 1990, THE VOTING
RIGHTS OF FOREIGN SHAREHOLDERS MAY BE DECREASED PROPORTIONATELY SUCH THAT THE
VOTING RIGHTS OF FOREIGN SHAREHOLDERS DO NOT, IN AGGREGATE, EXCEED 24.99%. FOREIGN
SHAREHOLDERS AND PROSPECTIVE INVESTORS ARE REFERRED TO THE COMAIR’S MEMORANDUM
OF INCORPORATION AND WEBSITE (www.comair.co.za) FOR FURTHER DETAILS. IF FOREIGN
SHAREHOLDERS OR PROSPECTIVE INVESTORS ARE IN ANY DOUBT AS TO WHAT ACTION TO TAKE
THEY SHOULD SEEK ADVICE FROM THEIR BROKER, ATTORNEY OR OTHER PROFESSIONAL ADVISER.
Date: 05-06-2020 01:20:00
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