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Eastlake Developments Limited— in Administration

High Court of Justice, Chancery Division,Birmingham District Registry

Case No.8226 of 2015

Joint Administrators’ second progress reportfor the period from 12 December 2015

to 1 June 2016

2 June 2016

PrweivaterIu)use( oopers LLPii

Iizrtjt u Str

Section Pages

1 Joint Administrators’ second progress report for the period from 3 - 5

12 December 2015 to 1 June 2016

2 Statutory and other information 6

3 Receipts and payments account 7

4 Analysis of the Administrators’ remuneration and disbursements 8 13for the period

5 Expenses incurred in the period 14

6 Form 2.24B

The following abbreviations are used in this report:

“1R86” Insolvency Rules 1986“the Administrators” Roger Hale and Robert Lewisthe Companv’ Eastlake Developments Limitedthe Group” Six associated companies including Eastlake Developments Limited

“LPH” Lewis Property Holdings Limited — in Administration“LIE” Lansdown Industrial Estate in Cheltenham‘PBS” Principality Building Society

1. Joint Administrators’ second progress report for the periodfrom 12 December 2015 to 1 June 2016

Introduction

We write to provide an update on the progress of the administration, covering the period from 12December 2015 to i June 2016. This report should be read in conjunction with our previous reportcovering the period from appointment on 12 June 2015 to ii December 2015, which is still available at:www.pwc.co.uk/edl

The administration is due to come to an automatic end on 11 June 2016. however the outstandingmatters in the administration will not be concluded by that time. Therefore this report has beenprepared to support a request for a twelve month extension to the period of the administration to iiJune 2017. In accordance with insolvency legislation and in the circumstances of this case, such arequest must be made to the secured lender, PBS. Assuming the request for an extension is approved,a copy of this report will subsequently be circulated to all creditors, together with a notice of theextension.

We are required to provide certain statutory information pursuant to Rule 2.47(1)(a) to (d) 1R86,which is included in Section 2.

Asset Realisations in this period

Bolt Street, Newport

The Company’s interest in Bolt Street consisted of 11 residential houses which were let and managedby Roberts & Co prior to our appointment.

The sales process was managed by Roberts & Co and we are pleased to report that Bolt Street was soldon 16 March 2016 for consideration of £620,000 to PGS Developments Limited.

Total rental income in relation to Bolt Street prior to completion was £45,289.

Regent Court!Randstad Court

We have continued to use the existing managing agent, Jessop & Co. to manage the property andadminister the service charge. The sales process is ongoing and an offer has been accepted and issubject to contract.

We are continuing to collect rent due from sub-letting the car park spaces to tenants.

Total rental income in this period to t June 2016 in relation to Regent Court is £130,776.

Parcels of land at (‘arfin

The (nmnparo houht a situ f r des uiprn ut prior to oui appolntnlent Ehese i’aruels relate to theu\ues land that n’mamud I llown this des loprnunt. \ .ale f thesu parunis 1 land tISs I ecentlvcomploted hr t ta] nsideratinn f £o

Receipts and I)aYflents account

An ae unt at tb reipb and pm nt n ‘he ion]Inist13tifl hr tb ten ii from a Ln ucmb rto 1 Jun0 aniP is set ut in Secti n

.

Expenses statement

statement f the expt nses men nc I L t id rnnictrators in the period 12 i)e’ember 2 15 t I U2011 iluliePsI at Sec lion

Ii ‘Oil 110 1

‘n

i Joint Administrators’ second progress report for the periodfrom 12 December 2015 to 1 June 2016

Administrators’ remuneration

The Administrators’ remuneration has been approved on a time costs basis by PBS as the Company’ssecured creditor.

The time costs incurred in the period covered by this report are £198,496. This includes time inrelation to both fixed and floating charge matters, This amount does not necessarily reflect theamount that will be drawn as remuneration by the Administrators for this period in due course. Inaccordance with the requirements of Statement of Insolvency Practice 9, a full analysis of the&dministrators’ time costs and Category 2 disbursements for the period 12 December 2015 to 31 May2016 is provided in Section 4.

Details of work, which would normally be undertaken by the Administrators’ own staff, that has beensubcontracted in the period covered by this report are provided in Section 4.

To 1 June 2016, the Administrators have drawn post-appointment remuneration of £100,000.

Creditors’ rights

Creditors have the right to ask for more information within 21 days of this report as set out in Rule2.48A of the Insolvency Rules 1986. Any request must be in writing.Creditors can also challenge fees and expenses within eight weeks of this report as set out in Rule2.109. This information can also be found in the guide to fees at:siaw,icaew,com/cn/technicaI/insoh ency/creditors-juides

Pre-administration costs

The unpaid pre-administration costs which were incurred prior to the appointment of theAdministrators, but with a view to the Company entering administration were approved for paymenton 3 No ember 2015 by PBS as the secured lender. These costs totalled £42,538 and have now beenpaid.

Outcome for creditors

Secured creditor

PBS’s lending to the Company as at the date of administration was in the region of £10.7 million and issecured by a debenture dated 30 June 2004. This security gies PBS fixed and floating charges over allthe Company s assets.

lo ate 2 6i i ii as be distnbt fed t PPS hol c ‘ do I iink F aI s tior iad i iisffc tru PB r 11

Preferential reditors (err ploees)

t

[nse ured r ditors

F d Iict prop ‘rts . Net propt rtx is floating chargr realisations aft ito ts, and after pa ing w setting

aside em ugh to pay preferential creditors in full. But it only has to be made available where thefioatin harge was created on or after i September 2003

i Joint Administrators’ second progress report for the periodfrom 12 December 2015 to t June 2016

__________________

There is unlikely to be a dividend for the unsecured creditors under the prescribed part or otherwiseas we currently estimate that all floating charge realisations will be required to meet floating chargecosts. However we cannot confirm the value of net property, at this stage as this is dependent onfuture realisations, Further details will be provided in due course.

Extension of the administration

We consider it necessar for the period of the administration to be extended by twelve months,

The extension is necessary to complete the asset realisations of the Company, namely Regent Courtalong with finalising VAT and tax matters, and distributing funds to creditors.

Ending the administration

Following disposal of all of the assets of the Company, the Administrators envisage that theadministration will be brought to an end by filing notice under Paragraph 84(1) Schedule Bi of theInsolvency Act 1986 with the Registrar of Companies, following which the Company will be dissolvedthree months later.

Next report

The Administrators anticipate that they will circulate their next report to creditors at the earlier of theconclusion of the administration or in approximately six months.

Yours faithfullyFor and on behalf of the Company

Roger HaleJoint dministrator

Roqer hale and Robert I ews have been appointed asjoint administrators of Lastlake Developments I imited to manage itsaffairs, business and propertu as its aqents. Both are licensed in the United Rinqdom to act as insolvency practitioners by theIn titute if(harter’dAecountrznts in Ingland and Woks,

c C ntr Ic [C so II o s Ifi cdlyt[ I

2 Statutory and other information

In relation to paragraph 100(2) Sch.Bi 1A86, allof the functions powers and duties of theAdministrators may be exercised by all or any ofthe Administrators,

Projnd of the administration:Estimated dividend for unsecuredcreditors:Estimated values of the prescribed partand the compans netppyLWhether and win’ the Administratorsintend to apply to court under Section176(5) 1486

I I ropca i Rcgulati or isolve i yProccedini,s ur ii Rgulatlon([()No 1346J2000 129 Max 2ooO)

Dissolution

Nil

Not appik able

Court details for the administration: High Court of Justice, Chancery Division,Birmingham District RegistryCase 8226 of 2015

Full name: Eastlake Developments LimitedTrading name: Eastlake Developments LimitedRegistered number: 03078869Registered address: Benson House, 33 Wellington Street. Leeds, LSi

4JPCompany directors: Melanie Hall, Bryan Lewis, Marlene Lewis, Guy

LewisCompany secretary: Melanie HallShareholdings held by the directors and Melanie Hall (23%), Bryan Lewis (27%), Marlenesecretary: Lewis (27%), Guy Lewis (23%)Date of the administration 12 June 2015appointment:Administrators’ names and addresses: Mr Roger Hale and Mr Robert Lewis, both of

PricewaterhouseCoopers LLP, 1 Kingsway,Cardiff, CFio 3PW

Details of any extension(s) to the initial Not applicable

Changes in office holder: Not applicableAppointor’s / applicant’s name and Eastlake Developments Limited, The Lodge , Parcaddress: Macs Ffynon, Itton, Chepstow, NPi6 6BDObjective being pursued by the (C) realising the Company’s assets to pay aAdministrators: dividend to one or more secured or preferential

creditorsDivision of the Administrators’responsibilities:

3 Receipts and payments account

Eastlake Developments Limited - in administrationAdministrators abstract of receipts and payments

12 June 2015 toii December

2015

£

12 December2015 to

i June 2016

£

12 June 2015 toi June 2016

£

FIXED CHARGE REAUSATIONS/RECEIPTSRental income - Maxet HouseSale of Bolt StreetSale of Land at CarfinSale of Lansdown Industrial Estatesale of Maxet House. Luton

COST OF REALISATION/PAYMENTSAgents feesInsuranceLease/hire paymentsLegal fees & disbursementsOffice holders post-appointment feesRent - head officeRepairs and maintenance

Distribution to chargeholder PBS

NET FIXED ChARGE REALISATIONS

FLOATING CHARGE REALISATIONS/RECEIPTSBalance at hankBank interestRefundsRental income - Bolt StreetRental income Regent C urtrhird Party f’undsWorking capital funding

COST OF REALISATION/PAYMENTSBank chargesEmplos cc related c st

‘Ic I

C

d aat rkir k 1 ital to din

27,928.20

620,000.00

20,000.00

810,000.00

1.525.000(10

3,002,928.20640,000.00

(26,986,50) (14,270,00) (41,256.50)(13,329,47) (3,650.21) (16,979.68)(1.854.00) (1,854.00)

(14,182.83) (14,182.83)(50,000.00) (so,ooo.oo)

(3,633.33) (3,633.33)(1,318.00) (2,008.00) (3,326.00)

(i 11,304.13) (19,928.21) (131,232,34)

(1.810,000.00) (809,000.00) (2,619,000,00)

441,624.07 (188,928.21) 252,695.86

21,961 10 21,961.10

504.85 611.88 1,116.73

587.90 587.90

28,768.33 16,520.76 45,289,09

116,292.15 130.775 82 24706797

26000 26000

100,000.00 100,000 00

268,374.33 147,908.46 416,282.79

a 400.000 oc305 388)

27,928.20

810,000.00

1 525,000510

2,362,928.20

620.000,00

20,000.00

(75.00)

(846.00)

j 8

(36.60) (iii6o)(846 00

‘1FI 1I’s (iI.RGI RE IS IO’s

4 Analysis of the Administrators’ remuneration and disbursementsfor the period

___________________________________ _______

Office holders’ charging and disbursement policy

Time charged to the administration is by reference to the time properly given by the Administrators and theirstaff in attending to matters arising.

It is the Administrators’ policy to delegate tasks in the administration to appropriate members of staffconsidering their level of experience and any requisite specialist knowledge, supervised accordingly, so as tomaximise the cost effectiveness of the work performed. Matters of particular complexity or significancerequiring more exceptional responsibility are dealt with by senior staff or the Administrators themselves.

All staff who work on these assignments (including cashiers, support and secretarial staff) charge time directlyto the assignment and are included within any analysis of time charged. Each grade of staff is allocated anhourly charge out rate which is reviewed from time to time. Work undertaken by cashiers, support andsecretarial staff is charged for separately and is not included in the hourly rates charged by partners or othermembers of staff. Time is charged by reference to actual work carried out on the assignments in 6 minuteunits. The minimum time chargeable is 3 minutes (i.e. 0.5 units).

Hourly rates

Specialist departments within the Administrators’ firm also provided expert advice. These teams included Tax,VAT and Pensions, These rates do vary but the figures below provide an indication of the maximum rate perhour.

Set out below are the relevant maximum charge-out rates (before VAT) per hour worked for the grades of theAdministrators’ staff actually or likely to be involved on these assignments. Time is charged by reference toactual work carried out on the assignment. There has been no allocation of any general costs or overhead costs.

In common with all professional firms, the scale rates used by Administrators may periodically rise (forexample to cover annual inflationary cost increases) over the period of administrations.

Administrator& Specialiststaff departments

£/hour £/hourGrade 1 July 2015 onwards t July 2015 onwardsPartner 825 1,075Director 490 1,085

Senior manager 425 915

Manager

___________

340 6oo

Senior Associate (qualified) 255 4109cr sso ate (unqualificd)

4. Analysis of the Administrators’ remuneration and disbursementsfor the period

____

Disbursements policy

Our firm’s expenses policy allows for all properly incurred expenses to be recharged to the case. Disbursementsare uharged to the assignment as follows:

Ian Farmer -‘ExpertiseAssociates (1998) Ltd

.-JI third parrt Pt ofessionals are required to uhmit time cosb analvsr and,’ or narrative in support o ipx oj(’esrnder.l ifl order for the Administrators to runsidcrxvhether they ‘ire reac’nabh’ in the uireurnstan at the

Category Policy £

1 All disbursements not falling under Category 2 are recharged at cost 32.08

Photocopying - At 5 pence per sheet copied, only charged for circulars to creditors 4.292 and other bulk copying.

Mileage - At a maximum of 71 pence per mile (up to 2,000cc) or 93 pence per2

mile (over 2,000cc).

Total for the period 12 December 2015 to 16 May 2016 36.37

Brought forward amount 262.87

Total 299.24

Summary of legal and other professional firms

The Administrators have instructed the following professionals:

Amount paidName of firm / Reason Basis of fees in the periodService provided organisation selected

()Legal advice F,versheds LLP Fxpertise Time costs £13,666.50

Valuation ofbusiness and acsets

Jessop & Co Expertise Time costs £0

Insurance Marsh Ltd Expertise Value of assets insured £3,650.21

Propet Roberts & Co Expertise Percentage £8.o25.ooManagementPropertyManagement

Fixed £3,860.00

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4. Analysis of the Administrators’ remuneration anddisbursements for the period

The following table explains the key elements of our work, as summarised in the table of time costs, bygrade of staff and area of work

What, if any, financialbenefit the work

Area of Work Work undertaken Why the work was provided to creditorsnecessary OR whether it was

required by statuteStrategy & planning • Cost monitoring To ensure case • Ensures orderly

• Holding update meetings progression and progression of casemonitoring costs

Secured creditors •Liaising with secured creditor To keep the secured • No financial benefitregarding sales creditor informed

•Reporting to secured creditor

Trading •Rental income coding and To ensure returns to • Achieving the highestreporting creditors are realisations possible for the‘Responding to tenant queries maximised benefit of creditors

•Liaising with utility agents‘Liaising with managing agents‘Supplier queries in relation toongoing supplies

\en unting ndtre;istr

‘Completing sales process forBolt Street‘Assessing potential purchasers‘Legal advice in relation torealisations‘Liaising with agents regardingsale of propertiesaUpdating insurance cover‘Marketing of Regent Court

‘Liaising with the InsolvencyService

•Respondingtoereditor queriesnLeixed b\ past and telephone

To ensure returns tocreditors aremaximised

To comply withstatutory obligations

To kep reditarsinformed

‘Achieving the highestrealisations possible for thebenefit of creditors

I • ( 1 Ingafport ding I

• I geas•Appo nIce & ranagcr 1cnws• Responding to enquiries• Filing documents it

r panIc Rouse

witlitt 0 igati

R uired ‘tut tag

•( ii1Pi iti 0

Assets

Investigations ‘Required by statute

e No finanemal bei efit

• Bmn&recanelations To mnanaitc tlh baak • Enrures proper‘A ountmng tam receipts and Ollit management of funds

a t\ iieflt tuta tR idn1niinmrtr:iI i 01 a ( lits

4. Analysis of the Administrators’ remuneration anddisbursements for the period

‘Completing sales process forRegent Court

Investigations ‘Liaising with the Inoi encvServic

• Achieving the highestrealisations possible for thebenefit of creditors• Required by statute

• •Re.pondine to redito’ querirs • oorreived by p “1 and tlcrihone

• Bank rrcnuihatinn, •• • A-rnnnt1n for re -pt dnd

jnero itit theadministration auont.

• No iinancial benebt

• N. firaicial trnetitt9iiI’- Oil per11:1flae ‘Ilint ‘ jji—.

Statutory and • Reporting to oreditors(onhl)llaIk( • Extension of administration

• 15.000 Required b et itutc

Tax & VAT • Reviewing the Companvs tax To comply with • Required by statute andposition statutory obligations ensures the maximum

• Tax advice on sales and recover VAT recovery of input VAT, for

• Reviewing the Company’s VATwhich maxirnises the benefit of creditors

. . realisations toposition

. .. creditors

• Preparing and reviewing post-appointment VAT returns,

jincluding partial exemptioncalculations.

Future work

We still need to do the following work to achieve the purpose of administration.

Whether or not the, work will provide a

Area of Work Work we need to do Estimated cost £financial benefit to

creditors

• Reviewing progress or • 2,000 • Incidental to properStrategy and administration strategy and management of thePlanning amend as appropriate administration

Secured creditors ‘Liaising with secured creditor • 2,000 • Ensuring orderly return‘Reporting to secured creditor of funds to secured creditor

‘Distributing to secured creditor

Trading ‘Rental income coding and • 4,000 • Achieving the highestreporting in relation to Regent realisations possible for thecourt benefit of creditors‘Liaising with utilit agents•Liaising with managing agents

Assets • 10.000

• 1.000

zi, 1n 1110 irid1

• (enpl

4. Analysis of the Administrators’ remuneration anddisbursements for the period

________

Tax & VAT • 10,000 • Required by statute and• Completing VAT and Tax ensures the maximum

returns recovery of input VAT, for

the benefit of creditors

Closure • 4,000 • Required by statute,• Obtaining clearances ensures all administration

• Closure procedures matters have been dealt

with

5. Expenses incurred in the period

The following table provides details of our expenses. Expenses are amounts properly payable by us asadministrators from the estate and includes our fees, but excludes distributions to creditors. The tablealso excludes any potential tax liabilities that we may need to pay as an administration expensebecause amounts becoming due will depend on the position at the end of the tax accounting period.

The table should be read in conjunction with the receipts and payments account which showsexpenses actually paid during the period and the total paid to date.

Expenses Brought forward Incurred infrom preceding the period Estimated Anticipated

period under review Cumulative future total£ £ £ £ £

Administrators’ 280,526.25 198,495.50 479.021.75 53,500.00 532,521.75time costs

Administrators’ 262.87 36.37 299.24 200.00 499.24disbursements

Legal fees and 17,364.00 18,498.00 35,862.00 15,000.00 50,862.00disbursements

Office costs, 86.40 86.40 200.00 286.40stationary andpostage

Rent 12,500.00 12,500.00 10,000.00 22,500.00

Telephones, fax etc 1,991,35 1,991.35 500.00 2,491.35

Storage costs 548.34 548.34 500.00 1,548.34

Agents fees 26,986.50 11,180.00 38,166 50 5.000,00 43,166.50

Insurance 13,329.47 3,650.21 16,979.68 3,000.00 19,979.68

Repairs and 2,008.00 2,008.00 500.00 2.50800maintenance

338,469.09 69 )( )8 88,400.00 696 4 9

Rule 2.47 Form 2,24BThe Insolvency Act 1986

Administrator’s progress report2.24B

Name of Company

Eastlake Developments Limited

In the

High Court of Justice, Chancery Division,Birmingham District Registiy

Company Number

03078869

Court case number

8226 of 2015

We (a) Roger Hale and Robert Lewis, both of PricewaterhouseCoopers LLP, 1 Kingsway, Cardiff,CFio 3PW

Joint administrators of the above company attach a progress report for the period

from to

(b) 12 December 2015 (b) 1 June 2016

(a) Insert full name(s) andaddres(es) of

administrator(s)

(h) Insert dates

SignedJoint Administrator