Re Exore Resources Ltd - [2020] WASC 285

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RE EXORE RESOURCES LTD; EX PARTE EXORE RESOURCES LTD [2020] WASC 285
CORAM:   VAUGHAN J
HEARD:   4 AUGUST 2020
DELIVERED          :   4 AUGUST 2020
PUBLISHED           :   4 AUGUST 2020
FILE NO/S:   COR 91 of 2020
BETWEEN:   EXORE RESOURCES LIMITED
Plaintiff
PERSEUS MINING LTD
Interested Party

Catchwords:

Corporations - Scheme of arrangement - Proposed share acquisition - Application for orders convening scheme meeting under s 411(1) of the Corporations Act 2001 (Cth) - Application for orders approving the distribution of scheme booklet comprising explanatory statement under s 412(1)(a) Corporations Act 2001 (Cth) - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 411(1), s 412(a)
Corporations Regulations 2001 (Cth)
Supreme Court (Corporations) (WA) Rules 2004 (WA)

Result:

Application granted

Category: B

Representation:

Counsel:

Plaintiff	:	J M Healy
Interested Party	:	M L Dean

Solicitors:

Plaintiff	:	Gilbert + Tobin
Interested Party	:	Corrs Chambers Westgarth

Case(s) referred to in decision(s):

Re MOD Resources Ltd; Ex parte MOD Resources Ltd [2019] WASC 326
Re Navitas Ltd; Ex parte Navitas Ltd [No 2] [2019] WASC 218
Re Nzuri Copper Ltd; Ex parte Nzuri Copper Ltd [2019] WASC 189
Re Tawana Resources NL [2018] FCA 1456
Re Wesfarmers Ltd; Ex parte Wesfarmers Ltd [2018] WASC 308

VAUGHAN J:

Overview

The plaintiff, Exore Resources Ltd (Exore), is an Australian public company listed on the official list as conducted by the ASX Ltd (ASX).
On 3 June 2020 Exore made an ASX announcement that it had entered into a scheme implementation deed (SID) with Perseus Mining Ltd (Perseus). Perseus is another Australian public company listed on the ASX and is also listed on the Toronto Stock Exchange (TSX). Under the SID it was proposed that Perseus would acquire 100% of the share capital of Exore by way of a scheme of arrangement. Thus a consequence of the scheme, if effectuated, is that Exore will become a wholly owned subsidiary of Perseus.
The proposal provided for ordinary shareholders in Exore to receive a scrip consideration of 0.07819 fully paid ordinary shares in the capital of Perseus for each Exore share.
By originating process dated 16 July 2020 Exore sought orders under s 411(1) of the Corporations Act 2001 (Cth) (Act) in relation to the proposed scheme of arrangement. The application came before me for hearing on 4 August 2020. After hearing from counsel for Exore and Perseus I made orders pursuant to s 411(1) of the Act to convene a meeting of Exore's members to consider and vote on the proposed scheme. Ancillary orders were made as to the convening and conduct of the scheme meeting. Orders were also made for the approval of the distribution of a scheme booklet comprising the explanatory statement under s 412(1)(a) of the Act.
I said that I would prepare written reasons for my orders. These are my reasons for the orders made on 4 August 2020.

Evidence and background facts

Exore relied on nine affidavits from five…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Re Exore Resources Ltd

Details

AGLC: Re Exore Resources Ltd [2020] WASC 285
Case: [2020] WASC 285
Decision Date: 4 AUGUST 2020

CaseChat Overview and Summary

Exore Resources Limited was the subject of a dispute concerning a proposed share acquisition under the Corporations Act 2001 (Cth). The case was heard in the Supreme Court of Western Australia. The central issue revolved around the approval of a scheme of arrangement between Exore Resources and its shareholders, which was proposed to be conducted via a meeting of shareholders. The application sought orders convening the scheme meeting, approving the distribution of the scheme booklet, and outlining the procedures for the meeting.

The court had to determine whether the proposed scheme of arrangement met the legal requirements under the Corporations Act, specifically sections 411 and 412. The application required the court to ensure that the scheme was fair and reasonable to the shareholders, and that all necessary documents were properly prepared and distributed. The court also had to consider the procedural aspects of convening and conducting the meeting, particularly in light of the COVID-19 pandemic, which necessitated adjustments to the usual meeting protocols.

The court found that the proposed scheme was fair and reasonable to the shareholders and that the necessary steps had been taken to properly inform them. The court issued orders convening the scheme meeting, approving the distribution of the scheme booklet subject to certain corrections and amendments, and setting out detailed procedures for the meeting. The court emphasised the need for flexibility in conducting the meeting due to the pandemic, allowing for simultaneous meetings at multiple locations and the use of technology. The orders also detailed the requirements for notice to shareholders and the procedures for voting at the meeting.

Following the scheme meeting, the matter was to be relisted for any necessary further hearings. The court also ordered that the plaintiff publish an advertisement in major newspapers if the matter was to be relisted, and that a copy of the orders be lodged with the Australian Securities and Investments Commission.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Accordingly, for these reasons, I made orders in the following terms:1.Pursuant to s 411(1) of the Corporations Act 2001 (Cth) (Corporations Act), the plaintiff convene a meeting of its shareholders for the purpose of considering and, if thought fit, agreeing to (with or without modification), a scheme of arrangement between the plaintiff and its shareholders (Scheme), being the Scheme substantially in the form set out at attachment C of annexure STT-17 located at pages 251 to 267 of the affidavit of Sarah Terase Turner affirmed 31 July 2020 (Third Turner Affidavit), to be held at Parmelia House, 191 St Georges Terrace, Perth WA 6000 at 10:00am (Perth time) on Thursday, 10 September 2020 (Scheme Meeting). 2.The explanatory statement in relation to the Scheme, as required by s 412(1)(a) of the Corporations Act and as set out in the scheme booklet which is annexure STT-17 located at pages 16 to 434 of the Third Turner Affidavit (Scheme Booklet), is approved for distribution to shareholders, subject to:(a)correction of any minor typographical or grammatical errors and final typesetting and formatting;(b)any minor amendments required or approved by the Australian Securities and Investments Commission (ASIC) for registration under s 412(6) of the Act;(c)correction or update of any relevant date references or last trading prices;(d)amending page 169 of the Scheme Booklet (located at page 185 of the Third Turner Affidavit) in accordance with the amendment identified in annexure STT-24 of the affidavit of Sarah Terase Turner affirmed 3 August 2020;(e)adopting as attachment D of the Scheme Booklet a copy of the executed deed poll (which is annexure MPB-7 located at pages 467 to 476 of the affidavit of Martijn Paul Bosboom affirmed 31 July 2020); (f)adopting as attachment C of the Scheme Booklet a copy of the Scheme referred to in par 1 of these orders; and(g)adopting as attachment E of the Scheme Booklet a signed version of the report of BDO Corporate Finance (WA) Pty Ltd (which is attachment E of the Scheme Booklet located at pages 279 to 428 of the Third Turner Affidavit) with any necessary changes contemplated by pars 2(a), (b) or (c) above.3.Subject to these orders, pursuant to s 1319 of the Corporations Act, the Scheme Meeting is to be:(a)convened, held and conducted in accordance with: (i)the provisions of pt 2G.2 of the Corporations Act (as amended by s 5(1) of the Corporations (Coronavirus Economic Response) Determination (No.1) 2020 (Cth)) that apply to the members of a company; and (ii)the provisions of the plaintiff's constitution which is annexure STT-3 located at pages 20 to 91 of the affidavit of Sarah Terase Turner affirmed on 16 July 2020 (First Turner Affidavit) (in particular, cl 12.3 of the constitution which permits a meeting to be held at two or more venues simultaneously using technology) that are not inconsistent with these orders and the provisions of the Act, that apply to the meeting of shareholders; and(b)convened using the notice of meeting in the form or substantially to the effect of the notice of meeting contained in attachment A located at pages 206 to 209 of the Third Turner Affidavit; and(c)convened, held and conducted as if rule 2.15 of the Supreme Court (Corporations) (WA) Rules 2004 (WA) (Rules) does not apply. 4.John Daniel Fitzgerald, or failing him Justin Albert Tremain, is appointed to act as chairperson of the Scheme Meeting (Chairperson) and is to report the result of the Scheme Meeting to the court. 5.The Chairperson may adjourn the Scheme Meeting in his absolute discretion to such time, date and place as he considers appropriate.6.Two shareholders present in person or by proxy, corporate representative or attorney under power and entitled to vote shall constitute a quorum for the Scheme Meeting.7.Voting on the resolutions to approve the Scheme at the Scheme Meeting is to be conducted by way of a poll.8.Each shareholder present and entitled to vote will be entitled to one vote for each share that the Shareholder is registered as holding at 5.00pm (Perth time) on 8 September 2020.9.Subject to registration of the Scheme Booklet with the ASIC pursuant to s 412(6) of the Corporations Act, the plaintiff is to despatch on or before 11 August 2020, a document substantially in the form of the Scheme Booklet (approved for distribution above), including:(a)the applicable proxy form (utilising the proxy form, as personalised, contained at Attachment F of the Scheme Booklet located at pages 430 to 431 of the Third Turner Affidavit) (or a link to a website for any electronic proxy lodgement); and(b)a small shareholder election form (as contained at Attachment G of the Scheme Booklet located at pages 433 to 434 of the Third Turner Affidavit),to the shareholders who appear on the register of members maintained by the plaintiff as at 5:00pm (Perth time) on 10 August 2020, as follows: (i)to each shareholder who has nominated an electronic address for the purposes of receiving notices of meeting from the plaintiff, by email to such address, such email to be substantially in the form of the draft email set out at Annexure STT-11 located at pages 718 to 719 of the First Turner Affidavit; and(ii)to each other shareholder: (A)who has a registered address in the register of the plaintiffs members in Australia, by pre-paid post, parcel post or courier; and (B)who has a registered address in the register of the plaintiffs members outside Australia, by pre-paid airmail, airmail or air courier,or any other address the Shareholder supplies to the plaintiff for giving notice.10.Dispatch of the documents referred to in par 9 of these orders in accordance with the delivery methods stated in par 9 of these orders on or before 11 August 2020 is to be taken to be sufficient notice of the Scheme Meeting.11.If it comes to the attention of the plaintiff that any email dispatched in accordance with par 9(i) of these orders has returned an undeliverable or undelivered receipt for a shareholder's nominated email address then, in respect of that shareholder, the plaintiff is to dispatch, within a reasonable time thereafter, a document substantially in the form of the Scheme Booklet, including the applicable proxy form, in accordance with par 9(ii) of these orders.12.The time by which shareholders must return their proxy forms or lodge them online in relation to the Scheme Meeting is 10:00am (Perth time) on 8 September 2020.13.The matter be relisted at 9:00am (Perth time) on 15 September 2020 for such hearing as is appropriate following the Scheme Meeting.14.If the matter is to be relisted, the plaintiff is to give notice of the hearing of the application pursuant to s 411(4)(b) of the Corporations Act for orders approving the Scheme by publishing an advertisement in the public notices columns of 'The Australian' and The 'West Australian' newspapers, substantially in the form of Annexure A to these orders, and the plaintiff is otherwise exempt from compliance with rule 3.4 of the Rules.15.A copy of these orders is to be lodged with the ASIC as soon as practicable after issue.