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BBT: Current Business Situation
Bach Tuyet Cotton Corporation has informed of its current business situation:
1. Results of the Board of Directors meetings:
After the shareholders’ meeting on July 14, 2008, the Board of Directors held four meetings as follows:
* On July 23rd, 2008: Electing the Chairman, Deputy Chairman, CEO; considering urgent issues for stable operation.
* On July 31st, 2008: Consulting the solution to the document of selling by order of Maritime Bank.
* On August 9th, 2008: Implementing the document of the Deputy Chairman of the Hochiminh City People’s Committee; considering the detail plan of issuing shares; discussing immediate methods to rehabilitate the business.
* On September 15th, 2008: Discussing a plan to rehabilitate the business; holding an extraordinary shareholders’ meeting (the meeting minutes were not taken because there were not any decisions at the meeting).
* The company will hold another meeting on September 23rd, 2008.
2. Current business situation:
The company is now in a precarious situation. All the activities of manufacturing and trading have been ceased since July 12th, 2008 and yet not been recovered. There have been only 25 employees nationwide to maintain all the activities at a necessary minimum. The creditors are claiming debts pressingly, even threatened to sue the company now and then; the clients are grieving; the market share has almost lost whereas constant costs and unemployment benefits have to be paid on a daily basis in spite of being reduced to a minimum. Regarding to the financial situation, it is completely exhausted: unable to afford minimum working expenses. The employees had stopped working for such a long time that most of them have quitted the job. The secretary to BOD and Head of Supervisory Board have also resigned.
The company is in urgent need of capital to recover the activities of manufacturing and trading. Since June 2007, BOM have almost taken every short-term measure like making trust loans, borrowing from individuals outside the company as well as from the employees inside the company, making use of capital of the suppliers, collecting money from the clients as much as possible... to maintain all the activities but it does not work any longer. Raising capital for the company is beyond the possibility and liability of BOM. BOM has reported to BOD several times (the latest one is on August 27th, 2008) and suggested that BOD should have directive opinions to solve the above-mentioned situation. Yet, until now, there has been no sign (even in the meeting on September 15th, 2008) that BOD has a specific direction.
3. The plan to recover business operations:
The plan was proposed at the meeting on September 15, 2008 but not discussed because the meeting was ended soon.
HoSE
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