Mentha, in the matter of The Griffin Coal Mining Company Pty Ltd (administrators appointed) (ACN 008 667 285) [2010] FCA 30

CLIFFORD STUART ROCKE, SCOTT BRADLEY KERSHAW AND BRIAN KEITH MCMASTER IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF GRIFFIN ENERGY GROUP PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 681 696), CARPENTER MINE MANAGEMENT PTY LTD (ADMINISTRATORS APPOINTED) (ACN 106 053 703), W.R. CARPENTER HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED), (ACN 008 401 796), CARPENTER MINE MANAGEMENT HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 122 080 684) AND W.R. CARPENTER AUSTRALIA PTY LTD (ADMINISTRATORS APPOINTED) (ACN 000 032 315)

1. The convening period for the meetings of creditors of each of The Griffin Coal Mining Company Pty Ltd (administrators appointed), Griffin Energy Group Pty Ltd (administrators appointed), Carpenter Mine Management Pty Ltd (administrators appointed), W.R. Carpenter Holdings Pty Ltd (administrators appointed), Carpenter Mine Management Holdings Pty Ltd (administrators appointed) and W.R. Carpenter Australia Pty Ltd (administrators appointed) (Companies and each a Company)required to be held pursuant to section 439A of the Corporations Actbe extended to midnight on 1 May 2010. 2. Pursuant to section 447A(1) of the Corporations Act, that, with respect to each Company, Part 5.3A of the Corporations Act is to operate as if: i. section 439A(1) also provided that the meeting of creditors required by that section may be convened and held within the convening period (including within the convening period as extended pursuant to subsection 439A(6)); ii. section 439A(2) of the Corporations Act provided that the meeting must be held within five business days from being convened in accordance with subsections 439A(3) and (4), being a date not necessarily within five business days from the end of the convening period (including the convening period as extended pursuant to subsection 439A(6)); and iii. section 439A of the Corporations Act operated generally to permit the convening and holding of the meeting of creditors of the Company during the convening period (including the convening period as extended pursuant to section 439A(6)) provided the requirements of subsection 439A(3) and (4) are complied with. 3. The exhibit marked "Confidential Exhibit BKM-2" be kept confidential on the Court file and not be made available for inspection by any person (other than the First Plaintiffs and Second Plaintiffs) without an order of a judge of this Court. 4. The First Plaintiffs' and Second Plaintiffs' costs of this proceeding be paid pro rata as a cost of the administration of each Company. 5. The First Plaintiffs and Second Plaintiffs have liberty to apply to the Court for any further extensions of the convening periods referred to in Order 1 at any time prior to 1 May 2010. 6. Any person, including any creditor of any of the Companies, or the Australian Securities and Investments Commission, who can demonstrate sufficient interest to make such application as he, she, or it may be advised, have liberty to apply to the Court to vary or discharge these Orders on 48 hours notice being given to the First Plaintiffs and Second Plaintiffs and to the Court. 7. The First Plaintiffs and Second Plaintiffs cause notice of these Orders, within two business days after the making of these Orders: (a) to be placed on the website maintained by the First Plaintiffs and the Second Plaintiffs at www.kordamentha.com and on the website maintained by the Companies at www.griffincoal.com.au; and (b) to be sent by email to all creditors of the Companies who have provided the First Plaintiffs and the Second Plaintiffs with an email address, and to all other creditors of the Companies who have provided the First Plaintiffs and Second Plaintiffs with a mailing address, by mail. 8. These orders be entered forthwith. 9. The Court reserves for further consideration any application to further extend the convening period for the meeting of creditors required to be held pursuant to s 439A of the Corporations Act with respect to each Company. Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website.

GENERAL DIVISION WAD 15 of 2010

IN THE MATTER OF THE GRIFFIN COAL MINING COMPANY LIMITED (ADMINISTRATORS APPOINTED) (ACN 008 667 285), GRIFFIN ENERGY GROUP PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 681 696), CARPENTER MINE MANAGEMENT PTY LTD (ADMINISTRATORS APPOINTED) (ACN 106 053 703), W.R. CARPENTER HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 401 796), CARPENTER MINE MANAGEMENT HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 122 080 684 AND W.R. CARPENTER AUSTRALIA PTY LTD (ADMINISTRATORS APPOINTED) (ACN 000 032 315) MARK FRANCIS XAVIER MENTHA, CLIFFORD STUART ROCKE, SCOTT BRADLEY KERSHAW, BRIAN KEITH MCMASTER IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF THE GRIFFIN COAL MINING COMPANY PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 667 285)

CLIFFORD STUART ROCKE, SCOTT BRADLEY KERSHAW AND BRIAN KEITH MCMASTER IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF GRIFFIN ENERGY GROUP PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 681 696), CARPENTER MINE MANAGEMENT PTY LTD (ADMINISTRATORS APPOINTED) (ACN 106 053 703), W.R. CARPENTER HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED), (ACN 008 401 796), CARPENTER MINE MANAGEMENT HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 122 080 684) AND W.R. CARPENTER AUSTRALIA PTY LTD (ADMINISTRATORS APPOINTED) (ACN 000 032 315)

THE PARTIES 1 The plaintiffs are administrators of various companies in the Griffin group of companies. Each of the plaintiffs is a partner of the professional services firm, KordaMentha. 2 The first plaintiffs are the administrators of The Griffin Coal Mining Company Pty Ltd (Griffin Coal). The second plaintiffs are the administrators of Griffin Energy Group Pty Ltd (Griffin Energy), Carpenter Mine Management Pty Ltd (CMM), W. R. Carpenter Holdings Pty Ltd (WR Carpenter), Carpenter Mine Management Holdings Pty Ltd (CMMH) and W. R. Carpenter Australia Pty Ltd (WR Carpenter Australia). 3 The first and second plaintiffs are the same persons, with the exception of Mr Mark Mentha who is an administrator of Griffin Coal alone. 4 On 3 January 2010, the first and second plaintiffs were appointed as administrators of Griffin Coal, Griffin Energy, CMM, WR Carpenter and CMMH. 5 On 13 January 2010, the plaintiffs held a first creditors' meeting for all companies, that is, Griffin Coal, Griffin Energy, CMM, WR Carpenter and CMMH. 6 Taking into account that the plaintiffs were appointed on a Sunday and the Australia Day public holiday, the statutory period for holding the second creditors meeting prescribed by s 439A(5) of the Corporations Act 2001 (Cth) (CA) (in respect of those companies) expires on 1 February 2010. 7 On 21 January 2010, the second plaintiffs were appointed as administrators of WR Carpenter Australia. No creditors meeting has yet been held.

APPLICATION 8 The plaintiffs apply, pursuant to s 439A(6) CA for an extension of the period in which to convene the second creditors' meeting for Griffin Coal, Griffin Energy, CMM, WR Carpenter and CMMH. The plaintiffs seek an extension of three months to 1 May 2010. 9 The second plaintiffs also apply for an extension of the period in which to convene the second creditors' meeting for WR Carpenter Australia. They seek an extension to the same date as the other companies, so that the administrations may be managed together. 10 The plaintiffs further seek orders (pursuant to s 447A CA) which permit them to convene a second creditors' meeting within the extended period if that proves desirable, so that the conduct of the administrations should not be held up if progress can be made earlier than expected. 11 The orders proposed by the plaintiffs also provide for any affected person to make an application on short notice in respect of the orders. 12 The plaintiffs' application is supported by an extensive affidavit of Brian Keith McMaster. Reference is made to the content of that affidavit in these reasons. 13 The Australian Securities and Investments Commission has been provided with notice of the application and has informed the Court by letter this morning that it will not object to or appear in relation to the application. 14 On the return of the plaintiff's urgent application, I made the orders substantially as sought and as published herewith. These are my reasons for doing so.

RELEVANT PRINCIPLES 15 The Court has jurisdiction to make the extension orders sought by reason of s 439A(6) CA. In exercising that jurisdiction, the Court should have regard to, and balance, the interests of creditors in a speedy administration and the need to allow sufficient time to administrators to carry out their function properly and maximise the benefit to creditors through a proper administration: Re Diamond Press Australia Pty Ltd [2001] NSWSC 313 at [10], Re Austcorp Group Ltd [2009] FCA 636 at [18]. 16 In order for the administrators to carry out their function properly, it is necessary that they should have sufficient time to investigate the affairs of the companies under administration and to provide sensible information and advice to the creditors: Hayes, in the matter of Estate Property Group Limited (Administrators Appointed) [2007] FCA 935 at [1]. That includes sufficient time to investigate and carry out a sale process in which structured 'due diligence' procedures are adopted: Re Diamond Press at [11], Re Hans Continental Smallgoods Pty Ltd [2008] FCA 1933 at [21]. It also includes time to pursue a possible recapitalisation. In Re Chemeq Ltd; ex parte McMaster [2007] WASC 154 an extension of six months was allowed for this purpose. 17 What will be 'sufficient' will obviously depend on the complexities of the issues involved in the administration. 18 A variety of other reasons which would also justify an extension are categorised by Austin J in Re; Riviera Group Pty Ltd (2009) 72 ACSR 352 at 355, [13] where his Honour said: [13] The reasons given for an extension in subsequent cases can be grouped into the following broad categories: • the size and scope of the business: Re Lombe; Babcock & Brown Ltd (admins apptd) [2009] FCA 349 (Re Lombe); Re Worrell; Storm Financial Ltd (recs and mgrs apptd) (2009) 69 ACSR 584 ; [2009] FCA 70 (Re Worrell); Re ABC Learning Centres Ltd; Application by Walker (No 5) [2008] FCA 1947; • substantial offshore activities: Re Lehman Bros Australia Ltd [2008] NSWSC 1132; • large number of employees with complex entitlements: Re S & D International Pty Ltd (in liq); Malhotra v Tiwari [2005] VSC 496; Re Ansett Australia Ltd and Korda; sub nom Ansett Australia Ltd (No 3) (FCR) (2002) 115 FCR 409 ; 40 ACSR 433 ; [2002] FCA 90; • complex corporate group structure and intercompany loans: Re Lombe; Re Octaviar Ltd (admins apptd) (recs and mgrs apptd) (ACN 107 863 436) [2008] QSC 272; Re LED Builders Pty Ltd (admin apptd) [2008] NSWSC 633; Hall; Re Australian Capital Reserve Ltd (admins apptd) [2007] FCA 1328; • complex transactions entered into by the company (for example securities lending or derivatives transactions): In Re Lift Capital Partners Pty Ltd (admin apptd) [2008] NSWSC 446 (Re Lift Capital); • complex prospects of recovery proceedings: Re Worrell; Coal Developments (German Creek) Pty Ltd v Cmr of Taxation (2007) 241 ALR 667 ; [2007] FCA 1324; • lack of access to corporate financial records: Re Sims; Destra Corp Ltd [2008] FCA 2002; Re Fincorp Group Holdings Pty Ltd (2007) 62 ACSR 192 ; [2007] NSWSC 363; • the time needed to execute an orderly process of disposal of assets: Re Carter, SFM Australasia Pty Ltd (admin apptd) (ACN 105 317 333) (No 2) [2009] FCA 419; Re ABC Learning Centres Ltd; Application by Walker (No 7) (2009) 71 ACSR 560 ; [2009] FCA 454; • the time needed for thorough assessment of a proposal for a deed of company arrangement: Silvia, Re Austcorp Group Ltd (admin apptd) [2009] FCA 636; • where the extension will allow sale of the business as a going concern: Re Lombe; Australian Discount Retail Pty Ltd [2009] NSWSC 110; Stewart, Re Kleins Franchising Pty Ltd (admin apptd) [2008] FCA 721; Re Uni-Aire Security Pty Ltd (admin apptd) [2006] FCA 1423; • more generally, that additional time is likely to enhance the return for unsecured creditors: Deputy Commissioner of Taxation v Scottsdale Homes No Pty Ltd (No 2) [2009] FCA 190; Re Fitzgerald; Primebroker Securities Ltd (admin apptd) (recs and mgrs apptd) [2008] FCA 1247; Re Vouris; Marrickville Bowling and Recreation Club Ltd [2008] FCA 622. 19 In Re; Riviera Group at 354 - 357, [8]-[18] it was also observed by Austin J: [8] It is striking that the voluntary administration provisions set a single statutory timetable for every administration of every company "from the smallest to the greatest": as Young J said in Mann v Abruzzi Sports Club Ltd (1994) 12 ACSR 611 at 612 (Mann). The attempt to set a single timetable was bound to create distortions and pressures for relief. The statutory power of courts to extend the convening period is the mechanism for adjusting the statutory timetable to meet the exigencies of the instant case. [9] When the voluntary administration provisions were introduced into the corporations legislation, by the Corporate Law Reform Act 1992 (Cth), it was contemplated that extensions of the convening period would not be given frequently; that is, there was thought to be a predisposition or a kind of factual presumption against an extension. The explanatory memorandum to the Corporate Law Reform Bill 1992 said (para 507): The court will be given a power to extend these periods … though it is not expected that this power would be exercised frequently, since it is an important objective of the new provisions for creditors to be fully informed about the company's position as early as possible and to have an opportunity to vote on its future as soon as possible. [10] As is noted in Ford's Principles of Corporations Law, LexisNexis, looseleaf, at [26.201], an additional reason for reluctance to extend the convening period is that the statutory moratorium on the prosecution of proceedings against the company and on enforcement of rights by chargees and owners or lessors of property during administration should not be prolonged without good cause. [11] Some remarks in early cases on s 439A(6) applications appeared to reflect the sentiment expressed in the explanatory memorandum. For example, in Mann, Young J (at 612) expressed the opinion that "it would be quite contrary to the whole spirit of [Part 5.3A] to allow administration to be unduly extended or, indeed, to over-encourage administrators to apply to the court". In Re Witta Coola Pastoral Co Pty Ltd [1999] NSWSC 148 the same judge expressed the view that the voluntary administration regime required an accelerated program of work on the part of the administrator; see also Allbuild Construction Co Pty Ltd; Ex parte Featherby [2000] WASC 227 (Allbuild Construction). [12] However, if one looks more closely at these cases it is less clear that there was any significant leaning against granting an extension, provided that adequate reasons were given in support of the application for extra time. In all three cases, extensions were granted as requested on grounds equivalent to those accepted in later cases. In Mann, for example, although Young J spoke in the manner indicated above about not allowing an administration to be unduly extended, he granted the extension sought on the grounds that the administration was complicated by the appointment of a receiver, the evidence indicated that the administrator was doing his best to deal speedily with negotiations that would enable the company to go back into survival mode, there was no evidence of prejudice to creditors or members in granting the extension, and if the meeting were convened without the extension the administrator would not have sufficient material to give a meaningful account of his administration. [13] … [14] Thecases show that where a substantial issue in any of these categories is established (and a fortiori, where the facts fit into more than one category), the court tends to grant an extension, and the extension tends to be for the time sought by the administrator provided that the evidentiary case has been properly prepared, there is no evidence of material prejudice to those affected by the moratorium imposed by an administration, and the court is satisfied that the administrator's estimate of time has a reasonable basis. [15] It is difficult to discern, especially in the most recent cases, any substantial remnant of the predisposition against extension. It is true that in Re Diamond Press Australia Pty Ltd [2001] NSWSC 313, Barrett J adverted to "an expectation reflected in the case law that an administration should proceed very quickly and should not be unduly prolonged, particularly in view of the moratorium situation it involves", and he said "it is intended to produce a reasonably speedy fate for the company, one way or another: at [8]. But his Honour continued (at [10]): [10] The function of the Court on an application such as this is, as I see it, to strike an appropriate balance between, on the one hand, the expectation that administration will be a relatively speedy and summary matter and, on the other, the requirement that undue speed should not be allowed to prejudice sensible and constructive actions directed towards maximising the return for creditors and any return for shareholders. [16] This "balancing test" has been applied frequently in later cases: for example Re Georges, Midas Australia Pty Ltd (admin apptd) [2009] FCA 38; Re Hayes; Estate Property Group Ltd [2007] FCA 935. If the approach is to "balance" the expectation of speedy administration against the risk of prejudice, there cannot be any predisposition in favour of speedy administration, for that would skew the balancing process. Rather, the cases suggest that where the administrator proves a substantial ground in any of the categories that I have set out, and there is no specific evidence of prejudice, an extension commensurate with the administrator's task will be granted, notwithstanding that the explanatory memorandum suggested that extensions would not be granted frequently. [17] It seems to me the degree of complexity of the administration is the key to understanding the court's current approach. It is obvious from the nature of the applications that have been made in recent years that, while there remain many voluntary administrations of small business companies that are relatively simple and can be carried out within the statutory timetable, there is an increasing number of more complex tasks for insolvency practitioners. Obviously, an increased number of the larger corporate groups are likely to be placed in administration in economically difficult times, and when they are, their sheer size, and their complex corporate structures and intercorporate finances, will create many problems for their administrators. Increasingly, companies in administration will have entered into complex funding arrangements, treasury instruments, and perhaps arrangements involving the use of trusts and managed investment schemes, rather than traditional funding. Business transactions are frequently overlaid with complexity because they are supported by collateral arrangements: for example, retention of title clauses or the use of derivatives for hedging and other purposes. Certain kinds of business are inherently complex, such as the securities lending arrangements in the Re Lift Capital case. [18] Where there is evidence of complexity of these kinds, it seems to me there is no place for a predisposition against extension. However, an important principle from the older cases remains good law: the applicant for an extension must adduce evidence establishing grounds, adequate to enable the court to carry out the balancing exercise about which the modern cases speak. The administrator is expected to explain with some particularity the problems that make the extension necessary: see Re Levi (1996) 19 ACSR 521; Allbuild Construction, above. Additionally, where there is a particular person or group who might be prejudiced by the extension that has been sought or the accompanying moratorium, evidence should be adduced about their position. Indeed, one can envisage cases where particular creditors who will be prejudiced by the extension should be notified of or joined as respondents to the application. The longer the extension that is sought, the more important it is for the court to be given a clear and complete explanation of the state of the administration, the grounds for the extension and any potential prejudice that would flow from granting it. 20 As to the effect, if any, of an extension upon creditors, particularly those who are subject to a statutory moratorium upon exercising their rights: Re Diamond Press at [8], Re Austcorp at [18], it will be relevant to take into account that no objection to an extension was raised at a first meeting of creditors or in response to a circular notifying creditors of an extension application: In the matter of Henry Walker Eltin Group Ltd (Administrators Appointed) [2005] FCA 316 at [2], Re Hans at [13], Re Babcock and Brown Ltd [2009] FCA 349 at [35]. I am told that the administrators are not aware of any creditors whose claim would be barred as a result of the extensions sought. 21 If an objection is raised, it is necessary to consider its basis- whether the objection is to the steps proposed by administrators or whether it is only to the time which those steps may take. If an objection of the second type is raised, the reasoning on which it is based should be carefully scrutinised as it is easy for creditors to assert that administrators should act more swiftly. Compare Re Hans at [16]. 22 The plaintiffs submit that while it is always a matter of assessing the individual circumstances of a case, it is not unusual for extensions to be granted in the order of two and half to three months: Re Hans at [26]. Recent examples of extensions in the cases referred to above and others include Henry Walker Eltin (3 months), Hayes (just over 1 month), Re Chemeq (6 months), Re; Capital Partners Pty Ltd [2008] NSWSC 446 (3 months), Re Hans (3 months), Re Babcock and Brown (4 months), Re ABC Learning Centres Ltd (No 7) (2009) 71 ACSR 560 (6 months), Re Austcorp (4 months), Re; Riviera (1 month), Re Fincorp Holdings Pty Ltd (2007) 62 ACSR 192 (3 months) and Re Windimurra Vanadium Ltd [2009] WASC 71 (3 months).

GRIFFIN GROUP 23 The supporting affidavit of Mr McMaster discloses the relevant background and considerations. From that affidavit, the following features (which I take from the affidavit and the plaintiffs' submissions) emerge. 24 Griffin Coal is a wholly-owned subsidiary of Griffin Energy, which, in turn, is an indirect wholly owned subsidiary of Devereaux Holdings Pty Ltd (Devereaux). Devereaux is an Australian corporation with diverse business interests, which are ultimately controlled by interests associated with the Stowe family. Other aspects of its business structure are not presently relevant and are confidential. Confidentiality has been claimed - and for now, ordered, in respect of a chart of the full corporate structure of the Devereaux group of companies, which Mr McMaster has obtained from the books and records of the companies. Confidentiality is claimed and ordered on the basis that the chart contains information as to the broader holdings of Devereaux, a private company, which information is not otherwise available to the public. 25 CMM is a wholly-owned subsidiary of CMMH, which, in turn, is a wholly-owned subsidiary of W. R. Carpenter Investments Pty Ltd (WRCI). In around December 2007, Devereaux purchased all the interests of WRCI, such that WRCI and its group of companies are now wholly owned subsidiaries of Devereaux. Devereaux and WRCI are not in any form of external administration. 26 Griffin Coal, one of the largest coal producers and suppliers in Western Australian, operates three open-cut coal mines in the Collie Basin. CMM operates and manages the coal mines owned by Griffin Coal. 27 Griffin Energy is a holding company that holds all of the ordinary shares of Griffin Coal. WR Carpenter and CMMH are each intermediate holding companies within the Devereaux group of companies, and do not appear to have any active business activities other than holding shares in their respective subsidiaries (including Griffin Coal and CMM, amongst other members of the Devereaux group of companies). WR Carpenter Australia is a wholly owned subsidiary of WR Carpenter which does not appear to have traded. 28 In addition to owning and operating coal mines, Griffin Coal owns all of the shares in Griffin Power Holdings Pty Limited and Griffin Power Holdings 2 Pty Limited. In turn, those companies, respectively, own all of the shares in Griffin Power Pty Limited and Griffin Power 2 Pty Limited. Those companies respectively own coal-fired power stations, known as Bluewaters 1 and Bluewaters 2, which are situated adjacent to the coal mines operated by Griffin Coal. The Bluewaters power stations obtain their coal supplies from Griffin Coal. 29 Bluewaters 1 power station is operational. The construction of Bluewaters 2 power station has been completed and it is also operating, however, Bluewaters 2 is approximately two to three weeks away from being formally handed over to its owner by the construction contractor, Mitsui & Co Limited. In the administrators' opinion, the value of Griffin Coal's interest in the Bluewaters 1 and Bluewaters 2 power stations is an important element in the value of the business operated by the Companies. 30 The other substantial asset of Griffin Coal is its ownership of Griffin Windfarm Holdings Pty Limited (Griffin Windfarm). The administrators' investigations to date suggest that Griffin Windfarm owns at least a 50% interest in Emu Downs windfarm at Emu Downs in Western Australia. It appears that the Emu Downs windfarm is the fourth largest windfarm in Australia. 31 There are a total of approximately 500 employees engaged in the mining operations, many of whom are members of, and have so far in the course of the administration of the companies been represented by, the Australian Manufacturing Workers Union (AMWU), the Construction, Forestry, Mining and Energy Union (CFMEU)and the Association of Professional Engineers, Scientists and Managers, Australia (APESMA). 32 A small number of employees are engaged in the executive management of the companies' mining activities. Griffin Energy, CMMH, WR Carpenter and WR Carpenter Australia do not, from the administrators' investigations to date, have any employees.

THE COMPANIES' CREDITORS 33 The Companies' substantial creditors fall into 6 main categories: (a) Secured creditors as follows: (i) Commonwealth Bank of Australia (CBA) in relation to secured and unsecured liabilities (comprising loans and guarantee obligations) of the Companies, which CBA asserts exceed $80,000,000. The security held by CBA in respect of the secured liabilities of the Companies is: (A) From Griffin Coal, a Deed of Charge dated 29 May 2008 over Griffin Coal's interest in land situated known as Lot 50 Bunker Bay Road, Bunker Bay and Lot 683 Naturaliste Bay Road, Bunker Bay Road, together with registered real property mortgages over that property. The administrators do not consider that CBA has security over the whole, or substantially the whole, of the property of Griffin Coal. However, negotiations are continuing with CBA regarding how it will deal with its security and the administrators anticipate that an agreed position will be reached shortly. (B) From WR Carpenter, a Deed of Charge dated 10 October 2005 over WR Carpenter's interest in land at Cape Naturaliste Road, Cape Naturaliste, together with registered real property mortgages over that property. (ii) St George Bank Limited (SGB)in relation to a secured loan of approximately $1,000,000 advanced to Griffin Coal. The security held by SGB in respect of that secured loan consists of a Fixed and Floating Charge dated 28 September 2005 over Griffin Coal's interest in land situated at Lots 1, 2 and 3 Williams Road, Collie, together with registered real property mortgages over that property. (iii) Australia and New Zealand Banking Group Limited (ANZ) in relation to a secured guarantee liability of Griffin Coal in the amount of approximately $158,000,000. That liability relates to the financing of the construction of the Bluewaters 2 power station. The security held by ANZ in respect of that liability consists of a Fixed Charge dated 19 February 2008 in respect of Griffin Coal's interest in a blocked bank account maintained by Griffin Coal with ANZ. (iv) ACN 113 353 638 Pty Limited (ACN), an entity believed to be under the ultimate control of Mr Ric Stowe, in relation to a secured loan to Griffin Coal of approximately $10,000,000. The registered security held by ACN for that loan consists of registered mortgages of the mining leases held by Griffin Coal in connection with its Collie Basin mines. ACN also has a registered charge over all of the assets and undertaking of each of WR Carpenter Australia (excluding some specified assets) and Griffin Energy although it not clear what these charges secure. (b) Unpaid pre-appointment employee entitlements totalling approximately $9 million. (c) The Australian Tax Office has asserted unpaid tax liabilities totalling $196 million. (d) The holders of unsecured bonds issued by Griffin Coal (and guaranteed by Griffin Energy, CMM and CMMH) with a total value of approximately US$475m. (d) Trade creditors in excess of $35 million. (f) Devereaux group company creditors.

ACTIVITIES OF THE ADMINISTRATORS SINCE THEIR APPOINTMENT 34 Mr McMaster's evidence is that a significant amount of work (over 2,200 hours) has been involved in progressing the administrations to the stage that they have now reached. That work has included dealing with the Companies' secured creditors, equipment owners and financiers, employees, the Western Australian State government and major purchasers of coal produced from Griffin Coal's mining operations. In addition, the administrators have commenced their statutory investigations into the business and affairs of the companies leading up to their appointment. 35 From the foregoing, as well as the following, it is clear that the affairs the subject of the administration are complex and substantial.

PROPOSED APPROACH TO THE ADMINISTRATION OF THE COMPANIES 36 Mr McMaster has formed the opinion that it is in the interests of the creditors for the coal mining business to continue to operate during the administration period to the extent this is feasible, with a view to the administrators conducting a sale or recapitalisation of the businesses to occur as an going concern or on a 'whole of business' basis. 37 In Mr McMaster's opinion, a sale or recapitalisation of the companies or their businesses will be assisted by the availability of the deed of company arrangement mechanism provided by Part 5.3A CA including because: (a) greater value may be realised for the mining leases through a share, rather than asset sale. The administrators' preliminary understanding is that a sale of mining leases, as assets, may be difficult to achieve or, at the very least, conditional upon approvals from the Western Australian government; (b) in the event of a recapitalisation through, for example, a debt compromise and introduction of new equity, there may be transaction cost savings in maintaining the existing group structure through the use of a deed or deeds of company arrangement; (c) in either instance: (i) the perceived stigma of liquidation, as perceived by potential bidders for the businesses, can be avoided; (ii) the value of the businesses represented by their continuation as going concerns can be preserved; (iii) any accrued tax losses can potentially be preserved; and (iv) the maximum flexibility is maintained, including in relation to preserving the jobs of employees. 38 Accordingly, maintenance of a deed or deeds of company arrangement as an option for potential bidders seeking to acquire an interest in the businesses will, in Mr McMaster's opinion, assist in generating and maintaining 'competitive tension' for those businesses, thus maximising any sale price and benefiting, amongst others, creditors. 39 Mr McMaster has indicated that the administrators have already received interest from a significant number of parties in the possible sale or recapitalisation of the business of the Companies. At this stage, however, formal 'due diligence' has not been commenced, largely because of the numerous other tasks that the administrators have been attending to - the administrators' focus has been on stabilising the coal mining operations in order to preserve their value. Presently, the administrators are assessing the steps and work that will be involved in the conduct of the proposed sale/recapitalisation process - this will include the commissioning of expert advice as to the most appropriate strategy for the conduct of that process. Pending receipt of that advice, the administrators have not yet been able to form any firm opinion as to the timetable for the sale/recapitalisation process. 40 Mr McMaster has given a provisional indication that he expects the sale/recapitalisation process to take not less than six months, and expects to be able to come to a much more accurate estimate of the likely length of the process by about mid-April 2010.

POSITION OF CREDITORS 41 No creditors objected to a proposed extension of the date for the holding of the second creditors meeting when this was raised at the first creditor's meeting. 42 The administrators are presently causing Griffin Coal and CMM to pay each of their lessor creditors in the ordinary course of applicable trading terms for all lease payments relevant to the period of the administrations. While the lessor creditors may not be able to enforce accrued rights, the lessor creditors are still being paid in full during the administration, while the administrators continue to use the relevant property. 43 Mr McMaster has deposed to the fact that none of the lessor creditors apart from NAB Capital Leasing (referred to below at [49]) has expressed any opposition to the convening period extension being sought by the Administrators. Caterpillar Finance Australia Pty Ltd has expressly consented to the proposed extension period. 44 Several creditors of Griffin Coal and CMM have asserted "retention of title" claims to the administrators. Negotiations with those creditors are continuing, and it is the Administrators' intention to either purchase the relevant goods or to return those goods to the creditor (assuming the claim is accepted). None of the creditors asserting "retention of title" claims have expressed any opposition to an extension of the convening period for the administrations of Griffin Coal and CMM. 45 Mr McMaster also explains that the administrators are causing Griffin Coal and CMM to pay their trade and employee creditors in the ordinary course of applicable trading or employment terms for all goods supplied or services rendered during the period of the administrations, from internally generated cash flows, and possibly with the assistance of a third party working capital facility, during the administration of the Companies. 46 None of the trade or employee creditors, (apart from two who have sought a reduced extension period of one month) of Griffin Coal or CMM has expressed any opposition to the convening period extension being sought by the Administrators. 47 On 22 and 25 January 2010, the administrators sent emails to various secured creditors (CBA, SGB, ANZ and ACN) seeking their consent to this application. In many cases a response was requested by 12 noon on Monday 25 January 2010 (Sydney time). ACN has consented to the extension as has CBA and ANZ. 48 On 21 January 2010, the administrators sent a circular to members of each of the Griffin Coal Committee, the CMM Committee, the CMMH Committee, the Griffin Energy Committee and the WR Carpenter Committee by email seeking the consent of the members of each Committee to this application, and requesting a response by 12 noon on Monday 25 January 2010 (Sydney time). 49 Generally, members of the committees have not responded or have consented to the extension application. I was taken to specific exceptions and to the underlying basis expressed for reservation about or opposition to the extension sought. I will not at this stage disclose the details of, or identify, the four persons objecting to the ruling other than to say that it includes NAB Capital Leasing referred to in [43] above. Confidentiality has been claimed - and for now, ordered, in respect of the identity of those persons and the potential amount of indebtedness to them. 50 It suffices to say that the general substance of the communications referred to in the last paragraph is that the administrators should provide more information or be required to move more swiftly before, or as a condition of, the extension being granted. I am satisfied however on the detailed evidence that has been presented, at least at this stage, that the administrators have moved as swiftly as possible and have provided as much verified information as possible in a circumstance where their task is very substantial and where the objective they are seeking to achieve accords with the legislative intention supporting Pt 5.3A CA. It follows that the communications referred to in the last paragraph should not affect the outcome of the administrator's extension application. For a similar approach, see for example, Re; Capital Partners (at [34]).

CONCLUSION 51 The administrators will be granted an extension to convene the second creditors' meeting for each of the companies. This will enable the administrators to take significant steps in a complex administration, consistent with the objectives of Pt 5.3A CA. 52 The extension will also be granted in respect of WR Carpenter Australia, which has no creditors apart from the Australian Tax Office and ACN (a secured creditor). Both of these creditors have been informed of the application, and have confirmed their support for the application. Given the relationship with the Griffin group, and the likelihood of at least a proposal concerning all companies in administration, the administration of WR Carpenter Australia should be conducted jointly with the other related companies, rather than have meetings on different days supported by interrelated reports prepared at different times. 53 I will make the following orders: 1. The convening period for the meetings of creditors of each of The Griffin Coal Mining Company Pty Ltd (administrators appointed), Griffin Energy Group Pty Ltd (administrators appointed), Carpenter Mine Management Pty Ltd (administrators appointed), W.R. Carpenter Holdings Pty Ltd (administrators appointed), Carpenter Mine Management Holdings Pty Ltd (administrators appointed) and W.R. Carpenter Australia Pty Ltd (administrators appointed) (Companies and each a Company)required to be held pursuant to section 439A of the Corporations Actbe extended to midnight on 1 May 2010. 2. Pursuant to section 447A(1) of the Corporations Act, that, with respect to each Company, Part 5.3A of the Corporations Act is to operate as if: i. section 439A(1) also provided that the meeting of creditors required by that section may be convened and held within the convening period (including within the convening period as extended pursuant to subsection 439A(6)); ii. section 439A(2) of the Corporations Act provided that the meeting must be held within five business days from being convened in accordance with subsections 439A(3) and (4), being a date not necessarily within five business days from the end of the convening period (including the convening period as extended pursuant to subsection 439A(6)); and iii. section 439A of the Corporations Act operated generally to permit the convening and holding of the meeting of creditors of the Company during the convening period (including the convening period as extended pursuant to section 439A(6)) provided the requirements of subsection 439A(3) and (4) are complied with. 3. The exhibit marked "Confidential Exhibit BKM-2" be kept confidential on the Court file and not be made available for inspection by any person (other than the First Plaintiffs and Second Plaintiffs) without an order of a judge of this Court. 4. The First Plaintiffs' and Second Plaintiffs' costs of this proceeding be paid pro rata as a cost of the administration of each Company. 5. The First Plaintiffs and Second Plaintiffs have liberty to apply to the Court for any further extensions of the convening periods referred to in Order 1 at any time prior to 1 May 2010. 6. Any person, including any creditor of any of the Companies, or the Australian Securities and Investments Commission, who can demonstrate sufficient interest to make such application as he, she, or it may be advised, have liberty to apply to the Court to vary or discharge these Orders on 48 hours notice being given to the First Plaintiffs and Second Plaintiffs and to the Court. 7. The First Plaintiffs and Second Plaintiffs cause notice of these Orders, within two business days after the making of these Orders: (a) to be placed on the website maintained by the First Plaintiffs and the Second Plaintiffs at www.kordamentha.com and on the website maintained by the Companies at www.griffincoal.com.au; and (b) to be sent by email to all creditors of the Companies who have provided the First Plaintiffs and the Second Plaintiffs with an email address, and to all other creditors of the Companies who have provided the First Plaintiffs and Second Plaintiffs with a mailing address, by mail. 8. These orders be entered forthwith. 9. The Court reserves for further consideration any application to further extend the convening period for the meeting of creditors required to be held pursuant to s 439A of the Corporations Act with respect to each Company. I certify that the preceding fifty-three (53) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice McKerracher.