United Minerals Corporation NL (ACN 107 061 343), In the matter of United Minerals Corporation NL (ACN 107 061 343) [2010] FCA 7

Federal Court of Australia|2010-01-08|Before: McKerracher J

Pursuant to section 411(1) of the Corporations Act 2001 ("Act"), the Plaintiff convene a meeting of its Shareholders ("Scheme Meeting") at Ballroom B, Duxton Hotel, 1 St Georges Terrace, Perth, Western Australia at 10.00 am (WST) on Thursday 28 January 2010 for the purpose of considering and if thought fit approving, with or without modification, the Scheme, a copy of which is attached as Annexure 3 to the final draft document entitled "Scheme Booklet" (United Minerals Corporation NL ACN 107 061 343) ("Scheme Booklet") which is annexed as annexure "MVH6" to the affidavit of Mr Matthew Hogan sworn 1 December 2009 in support of the Originating Process; 2. Pursuant to section 1319 of the Act, the Scheme Meeting be convened, held and conducted in accordance with the provisions of: (a) Part 2G.2 of the Act that apply to the members of a company and have not been displaced or modified by the Plaintiff's Constitution; and (b) the Plaintiff's Constitution that are not inconsistent with that Part and that apply to a meeting of members, save that all voting at the Scheme Meeting be by poll demanded by the Chairman; 3. Pursuant to section 1319 of the Act and for the purposes of Corporations Regulation 7.11.37(3)(b), the specified time for identification of securities' holdings for the Scheme Meeting, shall be 5pm (WST) on Tuesday 26 January 2010, with power to the Chairman of the Scheme Meeting in his absolute discretion to allow late proxies up to the commencement of the meeting; 4. Plaintiff be exempted from compliance with the requirements of Rule 2.15 of the Federal Court (Corporations) Rules 2000 ("Rules"), save in so far as that Rule applies reg. 5.6.13 (without the Form 530 stipulated therein) of the Corporations Regulations to the Scheme Meeting; 5. Alan Birchmore, or failing him, David Craig shall act as Chairman of the Meeting and report the results of the Scheme Meeting to this Court; 6. The Chairman appointed for the Scheme Meeting has the exclusive power to adjourn the meeting or not in his absolute discretion; 7. The proposed Scheme Booklet comprising the Explanatory Statement and its annexures which is annexure "MVH6" to the affidavit of Mr Matthew Hogan sworn on 10 December 2009, which Scheme Booklet comprising the Explanatory Statement as required by section 412(1)(a) of the Act be and is hereby approved (subject to any minor amendments required or approved by the Australian Securities and Investments Commission ("ASIC") for purposes of registration thereof under section 412(6) of the Act); 8. No later than 5pm (WST) 24 December 2009, the Plaintiff (subject to the registration of the Explanatory Statement by ASIC pursuant to section 412(6) of the Act) dispatch documents comprising: (a) Scheme Booklet comprising the Explanatory Statement; and (b) Notice of Court ordered Scheme Meeting and Proxy Form, which are the annexures "MVH6" to the affidavit of Mr Matthew Vernon Hogan sworn on 11 December 2009 to all the Shareholders of the Plaintiff by ordinary pre-paid post (or, in the case of overseas members, by airmail) at their addresses appearing on the Plaintiff's register of members on the closest practicable business day before the dispatch of documents; 9. Leave be given to the Plaintiff to make application for orders under sections 411(4) and 411(6) of the Act following the Scheme Meeting for approval of the Scheme to be heard on Wednesday 3 February 2010 at 10.15 am (WST) or such other date as the Court sees fit to set for such purpose; 10. The Plaintiff publish notice of the hearing of that application in the form or to the effect of the advertisement in the Schedule hereto once in the West Australian newspaper at least 5 days before the date fixed for the hearing of the application; 11. There be liberty to apply upon the giving of 18 hours notice to ASIC; 12. An office copy of this order shall be lodged with ASIC as soon as practicable after these orders are made. 13. Schedule: NOTICE OF HEARING TO APPROVE COMPROMISE OR ARRANGEMENT Take notice that at 10.15 am (WST) on Wednesday, 3 February 2010 the Federal Court of Australia at the Peter Durack Commonwealth Law Courts Building, 1 Victoria Avenue, Perth, will hear an application by United Minerals Corporation NL (UMC) seeking the approval of a Scheme of Arrangement proposed between UMC and its members, if such Scheme of Arrangement is approved by those members at the Court ordered meeting convened to be held on Thursday, 28 January 2010 at 10.00 am (WST). If you wish to oppose the approval of the Scheme of Arrangement, you must file and serve on UMC a notice of appearance, in the prescribed form, together with any affidavit on which you wish to rely at the hearing. The notice of appearance and affidavit must be served on UMC at its address for service at least one day before the day fixed for the hearing of the application. The address for service for UMC is Blakiston & Crabb, 1202 Hay Street, West Perth WA 6005. Name of person giving notice or of persons legal practitioner: Marcello Cardaci Partner Blakiston & Crabb

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 eSearch on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA

GENERAL DIVISION WAD 227 of 2009

IN THE MATTER OF UNITED MINERALS CORPORATION NL (ACN 107 061 343) BETWEEN: UNITED MINERALS CORPORATION NL (ACN 107 061 343)

REASONS FOR JUDGMENT 1 The plaintiff (UMC) hopes to complete a Scheme of Arrangement between it and its ordinary share holding members (the Scheme) pursuant to the provisions of Pt 5.1 of the Corporations Act 2001 (Cth) (the Act). Approval of the Court is sought today under s 411 of the Act to enable that process to commence. The purpose of the Scheme is to enable UMC to be acquired by BHP Billiton Minerals Pty Ltd (BHP Billiton). 2 Under the Scheme, if approved, there will be a transfer of all UMC shares for a cash payment from BHP Billiton of $1.30 per UMC share. 3 The application is supported by affidavits from Mr Matthew Hogan who is UMC's Chief Executive Officer and Mr Marcello Cardaci, Solicitor for UMC. 4 The evidence in support of UMC's application indicates that UMC's Directors and BHP Billiton's Directors have agreed upon the 100 per cent acquisition and have formed the opinion that the most efficient method of securing that outcome is pursuant to the Scheme for which s 411 of the Act approval is sought so as to obtain the consent of all shareholders in UMC. 5 An 'arrangement' under a scheme is a broad notion. As observed in Re Hostworks Group Ltd (2008) 26 ACLC 137 at [26] it may extend to any subject matter which is something a company is able to agree with its members, and is likened to a contract between a company and its members. 6 Typically, such a scheme will have some elements that are compulsory for its members, if it is approved. In this case, there are such elements, such as the requirement that all members transfer their shares in exchange for cash. 7 The Australian Securities and Investments Commission (ASIC) has received the requisite notice and information under s 411(2) of the Act. It has been provided with the Scheme Booklet. The Scheme Booklet contains a proposed Scheme, a final draft Explanatory Statement with annexures. It contains the relevant independent expert's report and the proposed Notice of Meeting and form of proxy. I am satisfied that ASIC has had a reasonable opportunity to examine the materials and ASIC has indicated that it does not oppose the making of the orders which are sought nor does it wish to be heard in relation to the Scheme. I take into account these facts. 8 I am satisfied that the Scheme Booklet which comprises the Explanatory Statement appears to comply with the provisions of the Act in the sense of giving the necessary information such that a member could make an informed decision whether or not to approve the Scheme. Over and above that, it provides additional information consistent with that which would be required under Ch 6 of the Act in the context of a takeover bid. There is an independent expert's report. That report confirms the Scheme is fair and reasonable and that it is in the best interests of Scheme participants. 9 As Mr Hogan deposes, all UMC option holders and BHP Billiton have entered into private treaties by which UMC and the option holders in UMC have agreed to the transfer of their options in consideration for cash from BHP Billiton . The completion of that transaction will occur if the Scheme becomes effective. 10 It is also confirmed that if orders are made today that a meeting of creditors will be held to approve the Scheme, the Scheme Booklet will be registered with ASIC and sent together with the Notice of Meeting and form of proxy to all UMC members. 11 There is nothing in the Constitution of UMC which is apparently inconsistent with or contrary to the terms of the Scheme. There is no reason to think that the Scheme has been proposed by either UMC or BHP Billiton for the purpose of enabling those companies to avoid the operation of Ch 6 of the Act for the purposes of s 411 (17) of the Act. 12 There are a number of other aspects concerning the Scheme to which the Court's attention has appropriately been drawn. They include the mechanics of the mutual obligations. In order to minimise 'performance risk' BHP Billiton has agreed to deposit, before 11.00 am on the Implementation Date of the Scheme, the Scheme consideration in a trust account opened and operated by UMC for that purpose. It will be held on trust for the Scheme participants, pending payment by cheque on the Implementation Date. BHP Billiton is also bound under the Merger Implementation Agreement and the Deed Poll each of which reinforces its implementation obligations. There is no reason to conclude that it is unlikely that BHP Billiton will perform its obligations. 13 The warranty of unencumbered title is high-lighted. The reciprocal 'break-fees' in the merger implementation agreement arise from normal commercial merger negotiations. They are apparently within the reasonable bounds of the Takeover's Panel Guidance Note 7, (that is, not more than one per cent of equity value). The parties have each been separately advised and represented. The 'no-shop' constraints in the merger implementation agreement are subject to an exception for performance of fiduciary duties. For present purposes, there is no reason to believe that any of them raise a difficulty nor does it appear that ASIC is of that view.

CONCLUSION 14 In the circumstances, this ex parte application being a first stage of the process, I am satisfied that the proposed Scheme, if it achieves the statutory majority at the members' meeting is one which the Court would be likely to finally approve on an unopposed hearing. 15 Accordingly, I will make the orders as sought in the minute as follows: 1. Pursuant to section 411(1) of the Corporations Act 2001 ("Act"), the Plaintiff convene a meeting of its Shareholders ("Scheme Meeting") at Ballroom B, Duxton Hotel, 1 St Georges Terrace, Perth, Western Australia at 10.00 am (WST) on Thursday 28 January 2010 for the purpose of considering and if thought fit approving, with or without modification, the Scheme, a copy of which is attached as Annexure 3 to the final draft document entitled "Scheme Booklet" (United Minerals Corporation NL ACN 107 061 343) ("Scheme Booklet") which is annexed as annexure "MVH6" to the affidavit of Mr Matthew Hogan sworn 1 December 2009 in support of the Originating Process; 2. Pursuant to section 1319 of the Act, the Scheme Meeting be convened, held and conducted in accordance with the provisions of: (a) Part 2G.2 of the Act that apply to the members of a company and have not been displaced or modified by the Plaintiff's Constitution; and (b) the Plaintiff's Constitution that are not inconsistent with that Part and that apply to a meeting of members, save that all voting at the Scheme Meeting be by poll demanded by the Chairman; 3. Pursuant to section 1319 of the Act and for the purposes of Corporations Regulation 7.11.37(3)(b), the specified time for identification of securities' holdings for the Scheme Meeting, shall be 5pm (WST) on Tuesday 26 January 2010, with power to the Chairman of the Scheme Meeting in his absolute discretion to allow late proxies up to the commencement of the meeting; 4. Plaintiff be exempted from compliance with the requirements of Rule 2.15 of the Federal Court (Corporations) Rules 2000 ("Rules"), save in so far as that Rule applies reg. 5.6.13 (without the Form 530 stipulated therein) of the Corporations Regulations to the Scheme Meeting; 5. Alan Birchmore, or failing him, David Craig shall act as Chairman of the Meeting and report the results of the Scheme Meeting to this Court; 6. The Chairman appointed for the Scheme Meeting has the exclusive power to adjourn the meeting or not in his absolute discretion; 7. The proposed Scheme Booklet comprising the Explanatory Statement and its annexures which is annexure "MVH6" to the affidavit of Mr Matthew Hogan sworn on 10 December 2009, which Scheme Booklet comprising the Explanatory Statement as required by section 412(1)(a) of the Act be and is hereby approved (subject to any minor amendments required or approved by the Australian Securities and Investments Commission ("ASIC") for purposes of registration thereof under section 412(6) of the Act); 8. No later than 5pm (WST) 24 December 2009, the Plaintiff (subject to the registration of the Explanatory Statement by ASIC pursuant to section 412(6) of the Act) dispatch documents comprising: (a) Scheme Booklet comprising the Explanatory Statement; and (b) Notice of Court ordered Scheme Meeting and Proxy Form, which are the annexures "MVH6" to the affidavit of Mr Matthew Vernon Hogan sworn on 11 December 2009 to all the Shareholders of the Plaintiff by ordinary pre-paid post (or, in the case of overseas members, by airmail) at their addresses appearing on the Plaintiff's register of members on the closest practicable business day before the dispatch of documents; 9. Leave be given to the Plaintiff to make application for orders under sections 411(4) and 411(6) of the Act following the Scheme Meeting for approval of the Scheme to be heard on Wednesday 3 February 2010 at 10.15 am (WST) or such other date as the Court sees fit to set for such purpose; 10. The Plaintiff publish notice of the hearing of that application in the form or to the effect of the advertisement in the Schedule hereto once in the West Australian newspaper at least 5 days before the date fixed for the hearing of the application; 11. There be liberty to apply upon the giving of 18 hours notice to ASIC; 12. An office copy of this order shall be lodged with ASIC as soon as practicable after these orders are made. 13. Schedule: NOTICE OF HEARING TO APPROVE COMPROMISE OR ARRANGEMENT Take notice that at 10.15 am (WST) on Wednesday, 3 February 2010 the Federal Court of Australia at the Peter Durack Commonwealth Law Courts Building, 1 Victoria Avenue, Perth, will hear an application by United Minerals Corporation NL (UMC) seeking the approval of a Scheme of Arrangement proposed between UMC and its members, if such Scheme of Arrangement is approved by those members at the Court ordered meeting convened to be held on Thursday, 28 January 2010 at 10.00 am (WST). If you wish to oppose the approval of the Scheme of Arrangement, you must file and serve on UMC a notice of appearance, in the prescribed form, together with any affidavit on which you wish to rely at the hearing. The notice of appearance and affidavit must be served on UMC at its address for service at least one day before the day fixed for the hearing of the application. The address for service for UMC is Blakiston & Crabb, 1202 Hay Street, West Perth WA 6005. Name of person giving notice or of persons legal practitioner: Marcello Cardaci Partner Blakiston & Crabb I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice McKerracher.

Corporations Act 2001(Cth)ss 411(1), 411(4), 411(6), 412(1)(a), 412(6), 1319

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