Trustpower Limited
[2016] NZHC 1838
•9 August 2016
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2016-404-1768 [2016] NZHC 1838
UNDER Part 15 of the Companies Act 1993 IN THE MATTER OF
an appliction for orders approving a scheme of arrangement under s 236 of the companies Act 1993
BETWEEN
TRUSTPOWER LIMITED First Applicant
BAY ENERGY LIMITED Second Applicant
AUSTRALASIAN RENEWABLES LIMITED
Third Applicant
TARARUA WIND POWER LIMITED Fourth Applicant
Hearing: 8 August 2016 Appearances:
S A Armstrong and A J Nelder for Applicants
Judgment:
9 August 2016
JUDGMENT OF FOGARTY J
This judgment was delivered by Justice Fogarty on
9 August 2016 at 1.00 p.m., pursuant to r 11.5 of the High Court Rules
Registrar/Deputy Registrar
Date:
Solicitors:
Russell McVeagh, Auckland
TRUSTPOWER LIMITED [2016] NZHC 1838 [9 August 2016]
[1] This is an ex parte interlocutory application for initial orders under Part 15 of the Companies Act 1993 made by Trustpower Ltd, Bay Energy Ltd, Australasian Renewables Ltd and Tararua Wind Power Ltd.
[2] It is public knowledge that Trustpower Ltd and the other applicants are proposing entering into a scheme of arrangement under Part 15 of the Companies Act. Trustpower Ltd is a listed company and as a result it is important that details about its affairs are released on an orderly basis. The scheme of arrangement will require approval of the shareholders. The whole process is required by law to be overseen by the High Court.
[3] The High Court sat in Chambers on Monday 8 August 2016 to examine the merits of a without notice application for initial orders. These being orders approving and fixing the process towards applying for, all going well, a final order of this Court. The Court was provided with considerable information by way of affidavit and exhibits from Mr Paul Morton Ridley-Smith the chairman of the Board of Directors of Trustpower, Mr K J Palmer the Acting Chief Financial Officer of Trustpower, Mr A J Grenfell a chartered accountant of Auckland and Mr G A Anderson a specialist advisor to publicly listed companies. The application for interim orders was supported by detailed submissions from Ms Armstrong taking the Court through the steps planned to take place towards obtaining shareholder approval to the scheme of arrangement, before applying to the Court for final orders.
[4] The bulk of the hearing was taken with my following up on the issue of a minute on 4 August where I raised some questions, and receipt of a memorandum of counsel from Ms Armstrong in reply on 8 August 2016. The outcome is that I am satisfied that this application has been carefully prepared. It takes into account the interests of all persons and businesses affected by the proposal, so far as I can tell at this interim stage.
[5] The result is that I agree with the draft interlocutory orders formally intituled
“Interlocutory Orders Giving Initial Orders Under Part 15 of the Companies Act
1993, 8 August 2016”, a copy of which is attached to this judgment. These orders are made.
ORDERS
Timetable for Application for Final Orders
1.Unless otherwise advised by the Court, the originating application for orders approving the proposed demerger of Trustpower Limited ("Trustpower") into two separate companies by a scheme of arrangement ("Demerger") under Part 15 of the Companies Act 1993 ("Application for Final Orders") will be heard at 10:00 am on 6 October 2016.
Service and representation
2. That:
(a) service of the without notice interlocutory application for initial orders relating to the Application for Final Orders ("Application for Initial Orders") be dispensed with;
(b) representation in relation to the Application for Initial Orders be dispensed with;
(c) Trustpower serve all documents filed in this proceeding on the
Takeovers Panel;
(d) Trustpower serve these interlocutory orders and the Application for
Final Orders on the Commerce Commission;
(e) except as provided in these orders or required by section 236A of the
Companies Act 1993 (the "Act"):
(i) the applicants are not required to serve any other documents on the persons specified in these orders; and
(ii) if the hearing of the Application for Final Orders is adjourned for any reason, only those persons who are entitled to appear and be heard under order 25 below need be served with notice of the adjourned hearing date.
Court file not be searched
3.The Application for Final Orders, all interlocutory applications, affidavits (subject to order 4 below) and all other documents related to the approval of the Demerger shall not be searched, inspected or copied until such time as the Shareholder Materials (as defined at order 9 below) have been distributed to Trustpower shareholders in accordance with order 9 below.
4.The exhibit annexed and marked as "PRS-9" to the affidavit of Paul Morton Ridley-Smith sworn 28 July 2016 shall be kept confidential to the applicants and their agents for the purposes of giving effect to the Demerger.
Shareholder meeting
5.The shareholders of Trustpower will not be divided into classes for the purposes of voting at the Shareholder Meeting (as defined in order 6 below).
6. Trustpower shall:
(a) hold a special meeting of its shareholders:
(i) on or about 9 September 2016 at 10:00 am; (ii) at a venue located in Tauranga,
(the "Shareholder Meeting");
(b) at the Shareholder Meeting, put the Demerger (as described in the Shareholder Materials, which may be amended by Trustpower before the Shareholder Meeting in a manner consistent with these orders) to Trustpower's shareholders for consideration and approval in accordance with the orders in order 7 below ("Demerger Resolution"); and
(c) except as otherwise provided in these orders, conduct the Shareholder Meeting in accordance with the constitution of Trustpower and the provisions of the Act.
7.The Demerger Resolution shall be approved if it is passed (whether in person or by proxy):
(a) by 75% of the votes of the shareholders voting on the Demerger
Resolution; and
(b) a simple majority of the votes of those shareholders entitled to vote.
8.Only holders of Trustpower shares whose names appear in the register of shareholders as at:
(a) 5:00 pm on 19 August 2016 ("Shareholder Materials Record Time")
are entitled to receive the Shareholder Materials (as defined at order
9 below); and
(b) 5:00 pm on 6 September 2016 ("Shareholder Voting Record Time") are entitled to be represented and vote at the Shareholder Meeting or any adjournment or postponement thereof.
Notice of meeting and information for shareholders
9.Trustpower shall distribute to each shareholder, at least 10 working days before the Shareholder Meeting, documents substantially in the same form as exhibit "PRS-2" to the affidavit of Paul Morton Ridley-Smith sworn on 28 July
2016. The information for shareholders shall include: (a) a notice of meeting, including:
(i) the formal notice of meeting, including the Demerger Resolution that shareholders will be asked to vote on at the Shareholder Meeting; and
(ii) explanatory notes, including procedural details;
(b) a voting/proxy form for use by shareholders for appointment of a proxy to vote on the Demerger Resolution at the Shareholder Meeting or to vote on the polls at the Shareholder Meeting; and
(c) a scheme booklet which includes:
(i) the matters referred to in order 9(a);
(ii) explanatory notes giving shareholders details of the Demerger including the investigating accountant's report on the pro forma accounts provided in the Shareholder Materials; and
(iii) a report from an independent adviser on the merits of the
Demerger for Trustpower shareholders and creditors
(together, the "Shareholder Materials").
Notice to transfer suppliers and creditors
10.Trustpower shall, at least 10 working days before the Shareholder Meeting, send an "Approved Notice" (in the form specified at order 11 below) regarding the Demerger, the Application for Final Orders and rights of other parties to oppose the Demerger, to:
(a) all of Trustpower's suppliers and creditors:
(i) whose contact details are available on the Supplier Master File List (as further defined and described at paragraph 7.30 of the affidavit of Paul Morton Ridley-Smith sworn 28 July
2016) as at the Shareholder Materials Record Time; and
(ii) who have received a payment from Trustpower in the two years prior to the date these interlocutory orders are sealed,
by sending it to the same email addresses used by Trustpower to send monthly remittance notices. Where no email address is known, Trustpower shall send the Approved Notice by ordinary mail, in hardcopy, to the physical address recorded for that person in the Supplier Master File List; and
(b) any party to a Tararua Transferring Contract or a TANZL Transferring Contract (as further defined and described in the Implementation Plan) who is not already receiving a notification in accordance with order 10(a), by sending it in accordance with the notice provisions set out in their agreement.
11.The Approved Notice is in substantially the same form as exhibit "PRS-11" to the affidavit of Paul Morton Ridley-Smith sworn 28 July 2016, which includes three options depending on which of the second, third or fourth applicants will receive the relevant contract on the Implementation Date.
Distribution of the Shareholder Materials
12. Trustpower shall:
(a) distribute the Shareholder Materials at least 10 working days before the Shareholder Meeting to:
(i) all Trustpower's directors; (ii) Trustpower's auditors;
(iii) all Trustpower's shareholders listed on Trustpower's share register at the Shareholder Materials Record Time; and
(iv) the liquidators to be appointed in accordance with clause
2.3(b) of the Implementation Plan ("Proposed Liquidators") being Andrew John Grenfell and William Guy Black of McGrathNicol;
(b) send the Shareholder Materials to Trustpower's shareholders in terms of orders 9 and 12(a)(iii) by sending it to the shareholders' addresses as recorded on Trustpower's share register at the Shareholder Materials Record Time:
(i) in electronic format to all shareholders who have elected to receive documents from Trustpower in electronic form only; or
(ii) by ordinary mail in hardcopy format to all other Trustpower shareholders;
(c) provide, in the manner referred to in order 12(b) and as soon as practicable, a copy of the Shareholder Materials to any person not referred to in order 12(a)(iii) and who becomes a Trustpower shareholder and entitled to vote on the Demerger Resolution after the Shareholder Materials Record Time and before the Shareholder Voting Record Time;
(d) make hard copies of the Shareholder Materials available for inspection and removal at Trustpower's offices at 108 Durham Street, Tauranga 3110, New Zealand on the first working day after the Shareholder Materials are sent to Trustpower's shareholders; and
(e) make electronic copies of the Shareholder Materials available for inspection and download from Trustpower's website.
13.The Shareholder Materials shall be deemed to have been received by those to whom it was ordered to be sent 48 hours after being sent in accordance with order 12(a) above.
14.Trustpower shall be granted leave to effect service on Trustpower's shareholders outside the jurisdiction in the manner referred to at order 12(b).
15.Trustpower shall lodge the Shareholder Materials on NZX's market announcement platform prior to their distribution to shareholders in compliance with Trustpower's NZX listing rule obligations.
16. Trustpower shall:
(a) publish the Application for Final Orders and these interlocutory orders on its website;
(b) make a copy of the Application for Final Orders and these interlocutory orders available for inspection at Trustpower's offices at
108 Durham Street, Tauranga 3110, New Zealand; and
(c) send a copy of the Application for Final Orders and these interlocutory orders to any shareholder or other persons who will be bound by the Final Orders, who requests them (in hard or electronic copy as requested by that shareholder or other person) within two working days of receiving the request.
17.The following shall not constitute a breach of these orders nor invalidate any resolution passed at the Shareholder Meeting:
(a) an accidental omission by Trustpower to give the Shareholder
Materials to any person specified in order 12;
(b) an accidental omission by Trustpower to give an Approved Notice to any person specified in order 10;
(c) an accidental omission by Trustpower to give the Application for Final
Orders or these interlocutory orders to any person specified in order
16(c); or
(d) the non-receipt of any documents by any persons specified in orders
10, 12, or 16(c).
18.Where any such failure or omission set out in order 17 above is bought to Trustpower's attention, Trustpower shall endeavour to rectify it by the method and in the timeframe most reasonably practicable in the circumstances.
Powers of amendment and adjournment
19.Subject to order 19(b) below, Trustpower may make such amendments to the Shareholder Materials (including the Demerger Resolution) as it may determine are in its best interests or the best interests of its shareholders or other affected persons. If the Shareholder Materials are amended, it will be the Shareholder Materials as amended that will be put to shareholders for consideration and approval. Where possible, any such amendments to materials in the Shareholder Materials will be:
(a) made before Trustpower distributes the Shareholder Materials to shareholders and any other person identified in order 12(a) or directed to be served with this application; but
(b) if any material amendment to a document contained in the Shareholder Materials is made after the Shareholder Materials is distributed and more than 72 hours before the Shareholder Meeting (including any adjournment of the Shareholder Meeting), Trustpower will notify those persons identified at order 19(a) above of such amendment by lodging a notice on the NZX's market announcement platform, or other means that it considers will ensure timely notification of the amendment.
Reporting of the results of the Shareholder Meeting
20. Trustpower shall notify the outcome of the Shareholder Meeting by:
(a) lodging the results on the NZX's market announcement platform as soon as practicable after voting at the Shareholder Meeting is complete and the results are advised to the chair of the Shareholder Meeting by the scrutineer of the Shareholder Meeting; and
(b) serving written notice on persons entitled under order 25 below to appear and be heard at the hearing of the Application for Final Orders. Such notice is to be served as soon as is practicable after voting at the Shareholder Meeting is complete and the results are advised to the chair of the Shareholder Meeting by the scrutineer of the Shareholder Meeting.
21. Trustpower shall, as soon as reasonably practicable after the Shareholder
Meeting and in any event prior to the Court's consideration of the Application
for Final Orders, file with this Court, and serve on any party who has filed a notice or an application for leave under orders 23 to 24 (as applicable in accordance with order 26) at the relevant address for service, an affidavit or affidavits:
(a) verifying compliance with the requirements of the orders made following hearing of this Application for Initial Orders;
(b) updating the Court on the satisfaction of the conditions set out in the
Separation Deed (as defined in the Implementation Plan); and
(c) verifying the actions taken and the voting on the Demerger Resolution put to shareholders.
Minority buy-out rights
22.Trustpower shareholders who vote against the Demerger Resolution at the Shareholders Meeting will not have the right to invoke minority buy-out rights under section 110 of the Act.
Rights of opposition
23.Any shareholder of Trustpower who wishes to appear and be heard on the Application for Final Orders must, by 5:00 pm on 26 September 2016, file and serve on Trustpower at 108 Durham Street, Tauranga, 3110, New Zealand or by email at [email protected]:
(a) a notice of appearance (containing an address for service within New
Zealand); or
(b) if they oppose the Application for Final Orders:
(i) a notice of opposition (containing an address for service within New Zealand);
(ii) any affidavit(s); and
(iii) a memorandum of submissions on which they intend to rely.
24.Any other person who considers they have a proper interest in the Demerger and who wishes to appear and be heard on the Application for Final Orders to file and serve on Trustpower at 108 Durham Street, Tauranga, 3110, New Zealand or by email at [email protected] by 5:00 pm on 26
September 2016, an application for leave to be heard on the Application for Final Orders (containing an address for service within the jurisdiction), a notice of opposition, any affidavit(s) and a memorandum of submissions upon which that person intends to rely.
25. The only persons entitled to appear and be heard on the Application for Final
Orders shall be:
(a) Trustpower (and any of the second to fourth applicants); (b) the Takeovers Panel;
(c) those Trustpower shareholders who file a notice of appearance or opposition in accordance with order 23;
(d) those persons who claim to have an interest in the Demerger who file an application for leave to be heard and a notice of opposition to the Application for Final Orders in accordance with order 24 above, and who are subsequently granted leave to appear and be heard at the hearing of the Application for Final Orders; and
(e) the Proposed Liquidators.
26.Trustpower will, by 5:00 pm on 29 September 2016, serve (at the stated address for service) a copy of all documents filed in support of the Application for Final Orders as well as file and serve any papers in reply upon any person who has filed, and served on Trustpower, the documents specified in orders 23 and 24.
Trustpower's formal approval of distribution of shares of code companies for the purposes of section 236A(2) of the Act
27.To ensure compliance with section 236A(2) of the Act, the second and third applicants (who propose to be conditionally listed on the NZX Main Board prior to the in specie distribution of their shares held by Trustpower) shall, prior to the Court's consideration of the Application for Final Orders, put the Demerger proposal to Trustpower for formal approval by special resolution in accordance with the provisions of the Act, and the constitution of those companies in effect at the time approval is sought.
Leave to apply
28.The applicants are granted leave to apply to vary these interlocutory orders and to apply for such further interlocutory orders as may be necessary or appropriate at any time prior to the Court's determination of the Application for Final Orders.
Dated 2016
(Deputy) Registrar
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