Frequently asked questions The Voluntary Administration The Administrators are responsible for investigating the issues that led to the failure of the companies, and reporting to creditors. The first meetings of creditors of the Dick Smith entities were held today on 14 January 2016. The appointment of the Administrators will continue, as no alternative Administrators were nominated. Creditors resolved at the meetings to form committees of creditors, to consult with the Administrators about matters relating to the Administrations. The Administrators advised that it was likely that they would seek from the Court an extension of the period to convene the second meetings of creditors, where their recommendations regarding the future of the Dick Smith entities would be put to creditors. The Administrators provided high level information regarding the affairs of the Dick Smith entities, however advised that it was too early to provide a strong view on the reasons for the collapse of the Dick Smith entities or the likely return to creditors. For all further enquires please contact: Link Market Services Creditor Hotline: 1300 853 481 Email: dicksmith@linkmarketservices.com.au The Receivership Subsequent to this appointment, partners of Ferrier Hodgson were appointed Receivers and Managers over the parent entity and the Australian subsidiaries, with the exception of Mac 1 Pty Limited. The Receivers are responsible for the management of the Dick Smith business and will be liaising with suppliers and stakeholders in that regard. For all further enquiries regarding management of Dick Smith please contact: 1300 366 644 for online orders and enquiries. 1300 660 054 for store enquiries, repair enquiries and tech support. 03 9604 5663 for customer enquiries Via the “Contact Us” page on the Dick Smith website. Please also refer to Ferrier Hodgson website for further updates: www.ferrierhodgson.com/au/administrations/dick-smith-holdings-limited-and-associated-entities Provided below are some few frequently asked questions: Question Answer Who is McGrathNicol? McGrathNicol is an independent advisory firm specialising in Advisory, Forensic, Transactions, Restructuring and Insolvency. Who is Dick Smith Group Dick Smith is a retailer of consumer electronics. Who is Link Market Services? Link Market Services is a share registry and financial services provider. Link Market Services provide processing, communications and meetings to Insolvency Practitioners. Link Market Services are providing hotline and other services to the Dick Smith administrators. Link Market Services can be contacted by phone 1300 853 481 or by email dicksmith@linkmarketservices.com.au. What has happened to Dick Smith Group? / Why did the administration come about? The Dick Smith Group has been placed into voluntary administration and receivership. Ferrier Hodgson has been appointed by the Group’s lenders to handle the receivership, and are responsible for all business trading issues. The business will continue to operate as usual while Ferrier Hodgson seek a buyer for the Dick Smith businesses. Please also refer to Ferrier Hodgson website for further updates: www.ferrierhodgson.com/au/administrations/dick-smith-holdingslimited-and-associated-entities 2 Which companies have been placed into administration? Joseph David Hayes, Jason Preston, William James Harris and Matthew Wayne Caddy were appointed Voluntary Administrators over the following Dick Smith entities on Monday 4 January 2016: Entity ACN Dick Smith Holdings Limited 166 237 841 Dick Smith Sub-Holdings Pty Limited 160 162 925 DSE Holdings Pty Limited 001 456 720 Dick Smith (Wholesale) Pty Ltd 000 445 956 Dick Smith Electronics Pty Limited 000 908 716 Dick Smith Electronics Staff Superannuation Fund 059 802 470 Pty Limited InterTAN Australia Pty Ltd 002 511 944 Dick Smith Electronics Franchising Pty Ltd 054 295 733 Dick Smith Management Pty Ltd 001 585 735 Mac 1 Pty Limited 136 849 584 Joseph David Hayes, Jason Preston, Andrew John Grenfell and Kare Johnstone were also appointed Voluntary Administrators over the NZ subsidiary on Monday 4 January 2016, the administration of which is being handled by the McGrathNicol Auckland partnership. Entity Company No DSE (NZ) Limited 37602 3 What is a voluntary administration? The Board has appointed Voluntary Administrators to the Group. Voluntary administration is an insolvency procedure where the directors of a financially troubled company or a secured creditor with a charge over most of the company’s assets appoint an external administrator called a ‘voluntary administrator’. The role of the voluntary administrator is to investigate the company’s affairs, to report to creditors and to recommend to creditors whether the company should enter into a deed of company arrangement, go into liquidation or be returned to the directors. The Voluntary Administrators deal with the claims of unsecured creditors, including suppliers and customers who hold gift vouchers. The Voluntary Administrators will also hold meetings of creditors of the Group in due course. The Voluntary Administrators do NOT have any day to day responsibility or control over the Group’s assets or operations, with the exception of Mac 1 Pty Limited. For more information regarding administrations generally, please visit http://asic.gov.au/regulatory-resources/insolvency. How long will the voluntary administration process take? The Administrators were appointed on 4 January 2016. It is too early to comment on how long the administration will take. The Receivers have advised that they anticipate that the process to find a buyer for the Group may take up to six (6) months. Is the Company continuing to trade? The business will continue to operate as usual while the Receivers seek a buyer for the Dick Smith businesses. Where can I get a copy of the Report to Creditors or other public communications issued by the Administrators? A copy of the report to creditors and other key communications issued to stakeholders can be found on either: The Administrators’ website: http://www.mcgrathnicol.com/assignments/DickSmith or please supply Link Market Services with your email address or physical address and we will arrange for a copy to be sent to you. 4 When and where is the meeting of creditors being held? The first meetings of creditors for the following entities was held on Thursday, 14 January 2016 12:00pm at Wesley Conference Centre, 220 Pitt Street, Sydney NSW 2000. Entity ACN Dick Smith Holdings Limited 166 237 841 Dick Smith Sub-Holdings Pty Limited 160 162 925 DSE Holdings Pty Limited 001 456 720 Dick Smith (Wholesale) Pty Ltd 000 445 956 Dick Smith Electronics Pty Limited 000 908 716 Dick Smith Electronics Staff Superannuation Fund 059 802 470 Pty Limited InterTAN Australia Pty Ltd 002 511 944 Dick Smith Electronics Franchising Pty Ltd 054 295 733 Dick Smith Management Pty Ltd 001 585 735 The first meetings of creditors for Mac 1 Pty Limited was held on Thursday, 14 January 2016 10:00am at Wesley Conference Centre, 220 Pitt Street, Sydney NSW 2000. When are where will the second meeting of creditors be held? Without an extension of the convening period, the second meeting of creditors is due to be held by 9 February 2016. However; given both the financial complexities of the Group and the ongoing sale campaign being undertaken by the Receivers, the Administrators will be applying to the Court to extend the convening period. 5 How does the appointment of Receivers and Managers affect my employment? We understand that the business will continue to trade during the Receivership period and employees will continue and you will be paid by the Receivers in the ordinary course. Please refer to Ferrier Hodgson website for further updates regarding your employment: www.ferrierhodgson.com/au/administrations/dick-smith-holdingslimited-and-associated-entities Your entitlements accrued prior to the appointment of the Receivers (e.g. Annual Leave; Long Service Leave) are frozen at the date of appointment and are a priority unsecured debt of the Group. The Receivers are: In control of the business Seeking expressions of interest for a possible sale of the business as a going concern immediately. Who are the Receivers and why have they been appointed? James Stewart, Jim Sarantinos and Ryan Eagle were appointed Receivers and Managers over Dick Smith Holdings Limited (DSH) and a number of associated entities (referred to as the Group) on 4 January 2016 by a syndicate of lenders which hold security over the assets and undertakings of the Group. This appointment included all entities placed under Voluntary Administration, with the exception of Mac 1 Pty Limited. The Receivers’ appointment follows the appointment of Joe Hayes and other partners of McGrathNicol as Voluntary Administrators by DSH’s directors. 6 What will change in the running of the store? We understand that some of these changes to store operations are as follows: Deposits: Deposits cannot be refunded. The Receivers and Managers will be completing sales where deposits have been received subject to stock availability. If a customer has paid for an item in full, but not collected it, then the customer is allowed to collect the goods. Exchanges: Until further notice exchanges may only be accepted if the customer has a receipt, the item is in its original packaging and the item has not been used. Refunds: At this stage we are unable to provide refunds. Faulty Goods: Faulty Goods policy will continue in accordance with the existing store policy for goods purchased on or after 5 January 2016. For goods purchased prior to 5 January 2015 that are branded products, please contact the manufacturer directly. For goods purchased prior to 5 January 2015 that are Dick Smith branded, please complete a proof of debt form. What happens with my unused gift vouchers? The Receivers have determined that: No issued gift vouchers will be accepted No new gift vouchers will be issued Customers will valid unused gift cards may have claim against Dick Smith and should to contact Link Market Services to lodge their claim as a creditor. Is there contact for customers other in store? Customer hotline and email address: A DSH email address has been set up (dicksmith@fh.com.au) and staff should, where possible, direct customers to this email address. A DSH customer hotline will be set up shortly and the number will be circulated to employees as soon as possible. 7 If I have questions regarding my employment who should I call? All queries regarding the Receivership should be forwarded to the Receiver’s office. Who should I contact regarding my shares in Dick Smith? Please direct shareholders to view regular updates on the ASX or Ferrier Hodgson websites: Updates on the progress of the Receivership will be posted on our website www.ferrierhodgson.com/au/administrations/dick-smithholdings-limited-and-associated-entities www.asx.com.au www.ferrierhodgson.com/au/administrations/dick-smith-holdingslimited-and-associated-entities This document will continue to evolve as new issues and frequently asked questions come to hand. 8