For clients invested in the various Great Southern woodlot projects, you would have recently received in the mail, information from Agricola Crop Insurance relating to insurance required for the various woodlot projects. This follows on from the correspondence McGrath Nichol has sent out to investors in relation to insurance.
By reading through the documentation, insurance that was in place on the various woodlots to cover against fire, hail and windstorm damage expired on 30th September 2009. Since then, McGrathNicol who are the receivers of Great Southern have been working with Agricola Crop Insurance to provide a solution. An offer of insurance which contained a quotation was included as part of this mailout with the total premium based on the number of woodlots held and the project invested in.
At this stage, we recommend that each investor seriously looks into the option to take up insurance on their investment. Be mindful however that if the offer is taken up, there is no guarantee that premiums paid will be refunded should a new Responsible Entity be found, or in the worst case scenario should the projects be wound up, there is no guarantee that premiums paid will be refunded either. Payment is due by 30th November 2009.
For consideration, there is a creditors meeting planned for mid November to discuss the offers put forward by potential new Responsible Entities but no date has been locked in as yet. If this meeting does go ahead, there is the ability to wait to see what might happen in relation to insurance before committing.
It might seem like a case of possibly throwing good money after bad but your trees remain and are continuing to grow. With summer fast approaching (and presumably some disgruntled investors out there), insuring the assets that you hold might be a worthwhile exercise!
Once we hear further in relation to the creditors meeting (ie dates) we will let you know. If these are not scheduled until late November there may be insufficient time to see what happens at the creditors meeting and then pay any premium due.
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