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PEMBURY LIFESTYLE GROUP LIMITED - Update on Offer, Agreement to Settle Former Auditors, Halt in Liquidation Proceedings and Renewal of Cautionary

Release Date: 06/08/2020 12:55
Code(s): PEM     PDF:  
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Update on Offer, Agreement to Settle Former Auditors, Halt in Liquidation Proceedings and Renewal of Cautionary

PEMBURY LIFESTYLE GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2013/205899/06)
(“PL Group” or “the Company”)
ISIN Code: ZAE000222949    JSE Code: PEM


UPDATE ON OFFER TO SUBSCRIBE FOR SHARES BY VERITYHURST PROPRIETARY LIMITED
(“VERITYHURST”), CONCLUSION OF AGREEMENT TO SETTLE THE FORMER AUDITORS AND HALT IN
LIQUIDATION PROCEEDINGS AND RENEWAL OF CAUTIONARY ANNOUNCEMENT


Verityhurst
Shareholders are referred to the announcement released on SENS on 30 July 2020 wherein they
were advised, inter alia, that the board of directors of the Company (“Board”) had accepted an
offer from Verityhurst (“Offer”) to enter into a loan and share subscription agreement (“Share
Subscription Agreement”) in terms of which Verityhurst has agreed to subscribe for 180 000 000
ordinary PL Group shares (“Subscription Shares”) for cash at a subscription price of 10.5 (ten point
five) cents per share (“Subscription Price”) for a total consideration of R18 900 000 (“Share
Subscription”), subject to certain suspensive conditions, namely:

-      the signature of a Subscription Agreement on or before 31 July 2020;
-      the immediate disposal of the PLG Retirement Villages subsidiary at R1.00 to Mr AR
       McLachlan, his nominee or a third party, which is currently reflected in the PL Group results
       as discontinuing operations, is incurring monthly losses and has liabilities in excess of
       R20 million;
-      the listing of the Subscription Shares on the JSE Limited (“JSE”) within five business days of the
       lifting of the suspension of trading in the Company’s shares; and
-      the restructure of the Board.

On Friday, 31 July 2020, it was agreed that the date for the conclusion of the Subscription
Agreement and disposal of PLG Retirement Villages be extended and the parties have mutually
agreed to extend the date to 7 August 2020 to allow for the appropriate review and finalisation of
the relevant agreements. A draft subscription agreement has already been circulated to and
commented on by the Board. The draft disposal agreement is also in the process of being drafted.

Notwithstanding the above, Verityhurst has already commenced with the advance of funds to the
Company on Friday, 31 July 2020.

Halt in application for liquidation by former auditors and Renewal of Cautionary Announcement
Further to the ‘Receipt of Application for Provisional Liquidation and Cautionary Announcement’
released on SENS on 14 February 2020 regarding the liquidation applications served on the
Company by Moore Stephens Inc, PL Group’s former auditors, and the subsequent renewal of
cautionary announcements, the last of which was dated 26 June 2020, shareholders are advised
that Verityhurst has entered into an agreement for the acquisition of the claims from the former
auditors, and that the first payment in terms thereof has been made by Verityhurst. The agreement
provides for the initial halting of the legal proceedings and the withdrawal of the legal proceedings
on receipt of the final payment. It also provides for the former auditors to allow the incoming
auditors access to the working papers in order to verify opening balances, which was a stumbling
block for the new auditors.

Furthermore, an arrangement is being made for the new auditors to recommence with finalising
the audit for the year ended 31 December 2019. The aim is to have the audited results and Annual
Report finalised in early September 2020. Thereafter, application will be made to the JSE for the
lifting of the suspension of trade in the Company’s securities.

Shareholders are advised to continue exercising caution when dealing in the Company’s securities
until a further announcement is made.

The cautionary announcement published on 29 July 2020 remains in place.


By order of the Board

Johannesburg
6 August 2020

Designated Advisor                       Corporate Advisor to Verityhurst
Merchantec Capital                            AcaciaCap Advisors

Date: 06-08-2020 12:55:00
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