Owner did not comply with bank

2013-12-05 00:00

COURT papers say the final liquidation of the hotel had been delayed in a bid to turn it around.

A recent affidavit by Johan van Greunen, attorney for the Development Bank of SA, said an interim settlement agreement had been put in place to rescue the business.

The requirements of the agreement had included:

• The conclusion of several service level agreements,

• The appointment of a hotel manager and chef,

• The successful reconstruction of

the hotel’s financial statements and establishment of a full financial model for the hotel going forward,

• Making available working capital to fund the continued operation of the hotel, and

• A provision that the shareholders of the hotel would bind themselves as personal sureties and principal debtors for the debt to the Development Bank.

Van Greunen said these conditions were only partially complied with and, therefore, the bank wanted the company to be finally liquidated.

Requirements allegedly not met included a failure to appoint a hotel manager, to successfully reconstruct the financial statements, making working capital available and to provide for legal fees of R1 455 636,32.

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