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04.05.2005 General News

Afra Airlines Rebuttal Of National Security Report

By CEO Afra Airlines Ltd
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1. On or about February 9, 2005, the Criminal Investigation Department was requested to investigate the background of Luke Norman BUTLER, the Chief Executive Officer of who is alleged to have been adjudged bankrupt in Australia in 2002. Following the suspension of Air Carrier's License (ACL) on 4th February, 2005, I contacted Mr Francis Poku, Head of National Security, many times by correspondence and by telephone trying to ascertain the reasons behind the suspension of Afra's ACL. I was eventually requested by Mr Poku to meet with Mr David Asante Appeatu, the Director of CID in his offices, which I did together Afra's lawyers, Mr Jacob Saah and Mr Norbert Kudjawu. The meeting was also attended by Mr Prosper Agblor in his capacity as Head of Interpol, Ghana. The interview lasted, as best as I can recall, for around 2 hours. I was asked a great many questions which I endeavoured to answer fully, providing as much information as possible. Several times I was asked about my bankruptcy by both gentlemen and each time I explained the main factors behind my personal bankruptcy in 2002 i.e. that the charter airline business, Global Air from Australia, had conducted charter flights using our Boeing 747 passenger aircraft for the Government of Comoros for which it was owed over US$600,000 being an outstanding and unpaid amount by the Government of Comoros for several flights for which our business was not paid. I informed them that the amount was agreed and undisputed but simply not paid to our company then or even since. I further explained that I had a personal debt which I was required to pay of $150,000 Australian Dollars which at that time was equivalent to about US$105,000. I explained that as a consequence of the US$600,000 not being paid to our business I could not pay my debt (US$105,000) and was subsequently declared bankrupt. I believe this was in early 2002 around February I think. I explained that I had a very difficult bankruptcy trustee Mr Paul Pattison who I took to court on some 9 occasions in the Administrative Appeals Tribunal, a part of the Australian Federal Bankruptcy Court's jurisdiction – and won all 9 cases. I explained that fortunately the Global Air charter business was producing sufficient income at the time, and my wife, Simone Ayele Butler who is Ghanaian and a lawyer trained in the UK, became the Director of the companies that owned the Global Air business whilst I was personally bankrupt. I told the gentlemen that eventually on 17th September, 2003 my bankruptcy was annulled (not discharged but annulled – meaning legally it never happened and my record was made clean) as a result of a unanimous vote of my creditors and with the support of my bankruptcy trustee.

Mr Pattison. I produced copies of the annulment certificate and correspondence from Mr Pattison to support this. I had previously hand delivered copies of these records to Mr Poku who had also forwarded copies to Mr Appeatu as part of his briefing as we were told at the meeting. I told Mr Appeatu and Mr Agblor that I was not bankrupt, that I had been but that this was annulled and that I had no criminal record. I told them this information was readily verifiable from the Australian authorities (and that these two facts can even be checked online at - the web site for the Insolvency Trustee Services of Australia which allows bankruptcy and criminal records to be checked online over the internet). Mr Appeatu and Mr Agblor thanked me and my lawyers for our cooperation and for coming to see them and assured me that they would work on the matter immediately. I have never heard back from the Director of the CID, Mr Appeatu and have not received any responses to my requests for either a progress report or subsequently to be allowed to review their findings or information. 2. Our investigation has so far revealed that Luke Norman BUTLER is currently being investigated by the Australian Securities and Investment Commissions (ASIC) and that ASIC has issued Luke Norman BUTLER with a notice to demonstrate why he should not be disqualified from Managing Corporations. My former solicitors in Australia, Morgan Conley, sent me a copy of the notice from ASIC by email on 8th March, 2005 which I received and read on 9th March. I discussed the issues raised with the Brisbane Manager of Global Air, Mr Max Mead by telephone and with my brother, Mr Robert Butler who is a barrister in Australia. I requested that they get together to review the matters raised and to advise me of my best course of action. This issue was only raised one month after my meeting with Mr Appeatu and Mr Agblor. By the end of March Mr Max Mead advised me, after he had consulted with ASIC officers involved, that the ASIC investigation was as a direct result of complaints made by my former bankruptcy trustee, Mr Pattison that I had amongst other things, managed the Global Air companies whilst I was bankrupt, transferred shares to my wife the day prior to being declared bankrupt and that I had tried to defeat my creditors. These were issues and allegations were also made by Mr Pattison that were previously made and the subject of hearings in the Administrative Appeals tribunal of the Australian Federal Bankruptcy Court. I gave evidence as did Mr Pattison that was cross examined before the judge ruled. In each case the judge ruled in my favour and against the allegations of my former bankruptcy trustee. It appeared that Mr Pattison had withheld the fact that these allegations which he made to ASIC whilst I was out of Australia and not readily able to defend myself have already been tested in court.

I have informed ASIC accordingly in my written submission to them. Another matter raised by ASIC concerned my being a director of 2 companies that had been wound up in a 7 year period which allows ASIC to consider not allowing me to be a director of companies in Australia for a period at their discretion up to but not exceeding 5 years. The exception to this rule is that if the 2 companies are related companies it does not apply. In my case the 2 companies were very much related companies so I was advised that this issue was not a substantial issue of concern. I wound up the company Global Air Leasing Pty Ltd, after a period of it being dormant for 2 years and after changing its name to we Both Pty Ltd, on 6th October, 2003 – which was approximately one month after my personal bankruptcy was annulled on 17th September, 2003. 3. In the course of the investigation, the subject was interrogated. He admitted the bankruptcy allegation but added that the bankruptcy was annulled in 2003. He produced some documents to support his claim. Luke Norman BUTLER also claimed he once operated an airlines in the Comoros and also in the U.S.A. I attended one and only one meeting with Mr Appeatu, Director of CID in his offices on 9th February, 2005 which was also attended by Mr Agblor the Head of Interpol for Ghana and my lawyers Mr Saah and Mr Kudjawu. I volunteered the information that I had been bankrupt and that this had been annulled . I produced copies of the annulment certificate and correspondence from Mr Pattison to support this. As mentioned above, I told Mr Appeatu and Mr Agblor of the circumstances that led to this bankruptcy and the debt owed to our company Global Air by Comoros of $600,000 which, if paid to our business at the time would have allowed me to pay my debt of approximately $105,000 when it was due and so avoid bankruptcy. I did not say that I had ever run any airline in the U.S.A. This statement is false. 4. Consequently, Interpol Ghana was requested to assist in the investigation. Interpol Ghana in turn sought the assistance of their counterparts in Australia, the Comoros and U.S.A. Interpol Ghana requested their counterparts to confirm the subject's claims and if confirmed, the reasons why the businesses collapsed in these countries. Interpol Ghana also requested their counterparts in the countries named above to conduct a background check on Luke Norman BUTLER. Furthermore, Interpol Canberra (Australia) was requested to authenticate the documents produced by the subject in support of his claim that his bankruptcy has been annulled. As mentioned already, I did not say that I had ever run any airline in the U.S.A. This statement is false and no information would or could be forthcoming from Interpol U.S.A. regarding me ever having managed any airlines there. In addition, the business of Global Air which it did and still does as a charter airline registered in the Comoros has not collapsed. Similarly there are no collapsed businesses in the U.S.A. The language used in this respect is therefore prejudicial. Interpol Australia did confirm the bankruptcy was annulled. 5. Information received from Interpol Canberra indicates that in response to the request from Ghana, the Australian Securities Investment Commission (ASIC) has provided five extracts from the Insolvency Trustee Services of Australia's (ITSA) National Personal Insolvency Index (NPII) (the national register of persons bankrupt in Australia). Interestingly though all the extracts concern a person by the name of Luke Norman BUTLER, only two state the correct date of birth, that is, October 7, 1954. I have been bankrupt once and only once in early 2002 which was subsequently annulled on 17th September, 2003. I have never in my life lied about my age. I was born on 7th October, 1954. I have no knowledge in what other records they refer to and have not had this issue raised with me for me to have any opportunity to comment further. 6. The two that state the correct date of birth indicate that the subject has had a debtor's petition annulled by court order in August 2002 and a sequestration petition annulled by settlement of the debt in September 2003. I can only guess what this is about. It maybe that the reference to August 2002 reflects the record of the appointment of Mr Pattison as my bankruptcy trustee, as he was not the original trustee but applied to be appointed sometime after the commencement of the bankruptcy. In any event and as mentioned above I have been bankrupt once and only once in early 2002 which was subsequently annulled on 17th September, 2003. 7. ASIC further advises that Luke Norman BUTLER is currently under investigation and that ASIC has served him with a notice to show cause why he should not be disqualified from managing corporations pursuant to section 206F of the Corporations Act (of Australia). This is a repeat of paragraph 2 above which I have answered above. It should be noted that this is only an issue for Australia and for Australian corporations. It does not prevent me from being a company director in other countries or jurisdictions e.g. USA, UK, South Africa or Ghana. In addition, if I was to lose this issue before ASIC it would not stop me from buying or selling property, or owning shares or running private businesses in my own right i.e. that are not companies. It applies solely to being a director or an officer in a corporation. In not returning to Australia to defend myself personally I am taking a risk and at a disadvantage in this matter as I would have preferred to be there to collate all of the supporting documents to put before ASIC and to make my presentation to them in person. Even so, my wife and I have decided that it is more important for me to remain in Ghana to try to resolve the issues relating to the suspension of the ACL of Afra Airlines Ltd and the lifting of the highly restrictive conditions imposed on our License so that Afra may be able to operate as a viable private business in Ghana. In so doing we both secure the position of our substantial private investment in Afra and the position of our 40 Ghanaian employees who are so far working in a business that is being blocked from operating and earning any revenue. 8. According to Interpol Canberra, Section 206F of the said Act “provides that ASIC may disqualify a person from managing corporations for up to five years if, within seven years before ASIC notifies the person that he may be disqualified, the person has been an officer of two or more corporations, and

while the person was an officer, or within twelve months after the person ceased to be an officer of those corporations each of the corporations was wound up and a liquidator lodged a report with ASIC about the Corporation's inability to pay its debts” The above is true but incomplete as the exception to this rule is that if the 2 companies are related companies it does not apply. In my case the 2 companies were very much related companies so I was advised that this issue was not a substantial issue of concern. I wound up the company Global Air Leasing Pty Ltd, after a period of it being dormant for 2 years and after changing its name to we Both Pty Ltd, on 6th October, 2003 – which was approximately one month after my personal bankruptcy was annulled on 17th September, 2005. 9. Luke Norman BUTLER has responded to the notice by requesting that he be given the opportunity to make submission in his defence. A formal hearing before an ASIC decision maker has therefore been fixed for April 21, 2005 following which a decision will be made as to whether he should be disqualified or not. I did respond with a written submission in my defence. There was no formal hearing on April 21, 2005 as alleged. The matter will be decided by written submissions and, if the finding goes against me I have the right of appeal as provided for in the Corporations Act (of Australia). The judgement only applies within Australia and does not apply in other countries e.g. USA, UK, South Africa or Ghana. 10. We have not yet received any responses from the Comoros and the U.S.A. In anticipation of Interpol Ghana wishing to check my report of Global Air's business in Comoros and the unpaid debt to Global Air of $600,000 due which lead directly to my bankruptcy, which was given to them at the meeting at CID Headquarters 9th February, 2005, I provided Mr Agblor the contact details of Mr Eric Sossah who is the Lawyer for the Government of Comoros, based in Paris, who is familiar with all aspects the business between Global Air and Comoros including the issue of the unpaid debt. Unfortunately after several weeks I had passed I learned from Mr Sossah by an email I received from him that no one from Interpol Ghana or any of the Authorities in Ghana had contacted him. Mr Sossah then wrote an email to Mr Prosper Agblor of Interpol Ghana, which he also copied to me, to advise Mr Agblor that he is the lawyer for the Government of Comoros, that he is familiar with the matters concerning charter flights conducted by Global Air and inviting Mr Agblor to contact him. I printed out a copy which I hand delivered to Mr Agblor in his office. Mr Agblor then checked his email online and confirmed he had received a copy directly. He said to me “this is good it will help”. Mr Sossah has subsequently confirmed to me that neither Mr Agblor or anyone else has been in contact with him. Mr Sossah also confirmed he had called Mr Agblor several times without success. There can be no report from the USA regarding me running an airline there as I have never done so and did not say that I did. 11. Our investigation also revealed that legal action has been taken by Dr. Samuel Akuoku, a shareholder in , against Luke Norman BUTLER in the Fast Track High Court for recovery of the capital he (Akuoku) invested in the business, among other claims. I told Mr Francis Poku of this by written correspondence on 4th February, 2005 and provided to Mr Poku and subsequently to Mr Appeatu a copy of the writ, our defence, and the shareholders agreement where Dr Akuoku had agreed to buy shares, had requested share certificates which were issued to him. Our lawyer Mr Kudjawu pointed out his legal advice in the meeting with Mr Appeatu on 9th February that once shares had been purchased and issued the capital could not be withdrawn (which would necessitate cancelling the shares) nor could it be treated like a loan as this would be in breach of the Companies Law. The matter is before the court which is the appropriate place for it to be resolved. For the record we have offered, without prejudice, to buy Dr Akuoku's shares back from him over time. He has not accepted this offer. 12. In the course of the investigation, Luke Norman BUTLER sent an email to a certain Eric SOSSAH in France and copied the head of Interpol, Ghana. In that correspondence Luke Norman BUTLER requested Eric SOSSAH to provide the head of Interpol Ghana with information about the airline business he (Butler) carried out in the Comoros. The subject alleged that Eric SOSSAH is the Counsel for the Government of Comoros. Yes this is true as mentioned above but it is incomplete as it omits that Eric Sossah wrote to Mr Agblor, the Head of Interpol Ghana, to advise Mr Agblor that he, Eric Sossah, is the lawyer for the Government of Comoros, that he is familiar with the matters concerning the charter flights conducted by Global Air for Comoros and inviting Mr Agblor to contact him. As mentioned already, no one contacted Mr Sossah. 13. CONCLUSION Evidence so far gathered suggests that the subject has managed two or more businesses which were later liquidated. He was subsequently declared bankrupt as a result of debts he incurred in running those businesses. It is for this reason that he has been served with a notice to demonstrate why he should not be barred from managing companies according to the laws of Australia. This is incorrect and not supported by facts. My bankruptcy was annulled on 17th September, 2003. The liquidator of We Both Pty Ltd was appointed on 6th October, 2003 I was not declared bankrupt as a result of debts I incurred in running this business. My former bankruptcy trustee Mr Pattison initiated the complaints to ASIC along with complaints made simultaneously by his colleague the liquidator of We Both Pty Ltd. This information was withheld from ASIC that the matters that were complained of to ASIC had already been tested at law and resolved in the Federal Bankruptcy Court. As already mentioned I have informed ASIC of this as part of my written submissions. This ruling only applies to Australian companies (not businesses, property or shares) and does not apply in Ghana. 14. The conduct of the subject in trying to direct the investigation also suggests that he has something to hide. I have tried to be forthright and provide any and all information that may assist in this investigation as I have nothing to hide. I am greatly frustrated by the delays of 3 months in undertaking the investigation. I believe the only impediment that would bar me from investing in Ghana is if I were either currently bankrupt of a criminal. I am neither a bankrupt nor do I have any criminal record – both of which are capable to be searched and verified over the internet in less than 15 minutes. I see no valid reason for the delay, especially when we employ 40 Ghanaian staff and our business has been blocked for months from operating with no valid reasons given. 15. It is therefore our considered opinion that the subject does not have the required capital to invest in this ambitious airline business in Ghana. He is going to use other people's money for his own personal gain. We therefore suggest that his Air Carriers Licence be withdrawn altogether. We have so far invested US$8.5M in capital in Afra Airlines. We have operated Global Air as a Boeing 747 passenger and cargo airline for 5 years worldwide and have entered into contracts with Utilicraft Aerospace Industries Inc. of USA for the purchase of $1,200M worth of freighter aircraft for deliveries commencing 2007 – which deal was reconfirmed by letter from Utilicraft dated 6th April, 2005. Obviously others worldwide think we are credible. In Ghana, we have employed 40 Ghanaian staff since October 2004 at an operational cost of 100M cedis per month whilst we are blocked with a highly restricted Licence that was subsequently suspended the same day we announced plans to use it by code share and commercial cooperation. This report was then commissioned and one wonders whether this last paragraph was not written before all of the others? Afra Airlines Ltd is 85% owned by Africans and 75% owned by Ghanaians including our staff who I have given 30% shares to from my shareholding at no cost to them. I am happy to be judged on facts, not fiction, bias or “spin” and only ask that our investment, our staff and our belief in fairness is Ghana be vindicated by the lifting of the suspension on Afra Airlines licence and the removal of the restrictions to allow us to fly as a private enterprise airline in Ghana.

Thank you and God bless Ghana.

CEO Afra Airlines Ltd Accra

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