Takeovers Code (RLV No. 3 Limited) Exemption Notice 2008
Takeovers Code (RLV No. 3 Limited) Exemption Notice 2008: expired, on 1 January 2012, by clause 3.
Reprint
as at 1 January 2012
Takeovers Code (RLV No. 3 Limited) Exemption Notice 2008
(SR 2008/433)
Takeovers Code (RLV No. 3 Limited) Exemption Notice 2008: expired, on 1 January 2012, by clause 3.
Note
Changes authorised by section 17C of the Acts and Regulations Publication Act 1989 have been made in this reprint.
A general outline of these changes is set out in the notes at the end of this reprint, together with other explanatory material about this reprint.
This notice is administered by the Takeovers Panel.
Pursuant to section 45 of the Takeovers Act 1993, the Takeovers Panel gives the following notice (to which is appended a statement of reasons of the Takeovers Panel).
Contents
5 Exemption from rule 7(d) of Code
6 Exemption from rule 16(b) of Code
7 Conditions relating to notice of meeting
Notice
1 Title
This notice is the Takeovers Code (RLV No. 3 Limited) Exemption Notice 2008.
2 Application
This notice applies to acts or omissions occurring on or after 17 November 2008.
3 Expiry
This notice expires on the close of 31 December 2011.
4 Interpretation
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(1) In this notice, unless the context otherwise requires,—
Act means the Takeovers Act 1993
Code means the Takeovers Code under the Act
Fengli means Fengli Group (Hong Kong) Company Limited, a company incorporated in Hong Kong
meeting means the meeting of RLV shareholders to be held on or about 5 December 2008 to consider, amongst other things, whether to approve, for the purposes of rule 7(d) of the Code,—
(a) the allotment of the tranche 2 placement shares; and
(b) the allotment of voting securities to Fengli if Fengli exercises its placement options
notice of meeting means the notice of meeting, including explanatory material, to be sent to RLV shareholders in respect of the meeting
placement options means the 50 000 000 options to acquire voting securities that are issued to Fengli under the subscription agreement
RLV means RLV No. 3 Limited, a company incorporated in New Zealand
subscription agreement means the agreement dated 18 September 2008 between RLV and Fengli concerning the tranche 1 placement shares, the tranche 2 placement shares, and the placement options
tranche 1 placement shares means the first tranche of 100 000 000 voting securities to be acquired by Fengli under the subscription agreement
tranche 2 placement shares means the second tranche of 100 000 000 voting securities that may be acquired by Fengli under the subscription agreement
voting securities means voting securities in RLV.
(2) In this notice, a reference to a person increasing voting control is a reference to the person becoming the holder or controller of an increased percentage of the voting rights in RLV.
(3) Any term or expression that is defined in the Act or the Code and used, but not defined, in this notice has the same meaning as in the Act or the Code.
5 Exemption from rule 7(d) of Code
Fengli is exempted from rule 7(d) of the Code, to the extent that the rule requires the notice of meeting to comply with rule 16(b) of the Code, in respect of any increase in its voting control that results from—
(a) the allotment of the tranche 2 placement shares; or
(b) the allotment of voting securities following the exercise by Fengli of its placement options.
6 Exemption from rule 16(b) of Code
RLV is exempted from rule 16(b) of the Code in respect of the notice of meeting.
7 Conditions relating to notice of meeting
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(1) The exemptions in clauses 5 and 6 are subject to the condition that the notice of meeting contains the following particulars:
(a) the maximum number of voting securities that could be allotted to Fengli as a result of the allotment of the tranche 2 placement shares and the allotment of voting securities following the exercise by Fengli of its placement options:
(b) the maximum number of voting securities that could be allotted to Fengli as a result of the allotment of the tranche 2 placement shares and the allotment of voting securities following the exercise by Fengli of its placement options, expressed as a percentage of the total voting securities on issue after those allotments:
(c) the maximum percentage of the total voting securities on issue that could be held or controlled by Fengli after those allotments:
(d) the maximum percentage of the total voting securities on issue that could be held or controlled by Fengli and its associates after those allotments.
(2) The exemptions in clauses 5 and 6 are subject to the condition that the maximum numbers and percentages referred to in subclause (1) are calculated on the basis that—
(a) the tranche 1 placement shares and the tranche 2 placement shares are allotted, and Fengli exercises all of its options to acquire voting securities, on the terms set out in the subscription agreement; and
(b) there is no other change to the total number of voting securities on issue between the date of the notice of meeting and the expiry of this notice.
(3) The exemptions in clauses 5 and 6 are subject to the condition that the notice of meeting—
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(a) contains the following:
(i) full particulars of the allotment of the tranche 2 placement shares and the exercise of the placement options held by Fengli:
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(b) displays, in a prominent place, a disclaimer stating that, by exempting Fengli from rules 7(d) and 16(b) of the Code, the Takeovers Panel—
(i) is neither endorsing nor supporting the accuracy or reliability of the contents of the notice of meeting; and
(ii) is not implying that it has a view on the merits of the proposed issue of voting securities to Fengli.
8 Condition relating to content of annual reports
The exemptions in clauses 5 and 6 are subject to the condition that every annual report published by RLV must include, in a prominent position and in a form approved by the Takeovers Panel,—
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(a) until the date (if any) of the allotment of the tranche 2 placement shares,—
(i) a summary of the terms of the allotment of the tranche 2 placement shares; and
(ii) a summary of the terms and conditions of the exemptions in clauses 5 and 6 in respect of the allotment of the tranche 2 placement shares; and
(iii) a statement, as at the date of the annual report, of the number of voting securities allotted to Fengli as a result of the placement options, and that number expressed as a percentage of the total percentage of voting rights on issue held or controlled by Fengli; and
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(b) between the date of the issue of the placement options and their final exercise date,—
(i) a summary of the terms of the placement options; and
(ii) a summary of the terms and conditions of the exemptions in clauses 5 and 6 in respect of the placement options; and
(iii) a statement, as at the date of the annual report, of the total number of voting securities allotted to Fengli on the exercise of any of its placement options, and that number expressed as a percentage of the total percentage of voting rights on issue held or controlled by Fengli.
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9 When exemption in clause 5 does not apply
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(1) The exemption in clause 5 does not apply if—
(a) Fengli increases its voting control of RLV through some means other than through the allotment of the tranche 1 placement shares, the tranche 2 placement shares, or the exercise of its placement options; or
(b) there is a change in the effective control of Fengli.
(2) The exemption in clause 5 does not apply to any increase in Fengli's voting control resulting from the exercise of a particular option if, immediately after the completion of the allotment resulting from the exercise of that option, the total percentage of voting securities held or controlled by Fengli is greater than the maximum percentage of voting securities that could be held or controlled by Fengli as disclosed in the notice of meeting.
Dated at Wellington this 17th day of November 2008.
The Common Seal of the Takeovers Panel was affixed in the presence of:
[Seal]
K J O'Connor,
Member.
Statement of reasons
This notice applies to acts or omissions occurring on or after 17 November 2008 and expires on 31 December 2011.
RLV No. 3 Limited (RLV) has entered into an agreement with Fengli Group (Hong Kong) Company Limited (Fengli) for a private placement of RLV shares. The private placement agreement (the subscription agreement) has been entered into in conjunction with the proposed reverse listing of Minera Varry S.A. (Minera Varry) through RLV. Minera Varry holds the rights to operate an iron ore mine in Chile.
Under the subscription agreement, Fengli may subscribe for up to 200 000 000 RLV ordinary shares at US$0.125 per share (a total of US$25 million) along with 50 000 000 options to acquire RLV ordinary shares at US$0.125 per share (a total of US$6.25 million if exercised). The final exercise date of the options will be 3 years from their date of issue.
The private placement is to be structured in 2 tranches—
the first tranche of 100 000 000 RLV ordinary shares together with all (50 000 000) of the options (the placement options) will be issued to Fengli on or about the date of settlement of the Minera Varry reverse listing transaction (expected sometime in December 2008):
the second tranche of 100 000 000 RLV ordinary shares (the tranche 2 placement shares) will be issued to Fengli if certain production targets are met from the Minera Varry mining operation by July 2009. If the targets are not met, then either of RLV or Fengli may at its option give notice to the other terminating the obligation to subscribe for the tranche 2 placement shares.
The allotment of the tranche 2 placement shares, if it proceeds, will cause Fengli to increase its voting control in RLV above the 20% threshold in the fundamental rule of the Code. Accordingly, Fengli must obtain shareholder approval under rule 7(d) of the Takeovers Code (the Code) for its increase in control as a result of the allotment of the tranche 2 placement shares.
In the event that the allotment of the tranche 2 placement shares proceeds, and Fengli chooses to exercise any or all of its placement options, the resulting allotments will cause Fengli to increase its voting control from a position above 20%. Accordingly, Fengli must also obtain shareholder approval under rule 7(d) in the event that the allotment of the tranche 2 placement shares proceeds and it wishes to exercise any of its placement options.
The notice of meeting (which RLV is required to send to its shareholders under rule 7(d) of the Code) that contains the proposed resolution to approve the allotments to Fengli must specify certain particulars about the allotments, as set out in rule 16 of the Code.
It is impossible for RLV to comply with the requirements of rule 16(b) of the Code in respect of the allotment of the tranche 2 placement shares because it is unknown what the capital structure of RLV will be at the time of that allotment, assuming that it proceeds.
Similarly, RLV cannot comply with the rule 16(b) requirements in respect of the placement options because the calculations for the numbers and percentages require it to be known what number of the options are ultimately exercised by Fengli and whether there is any change to the capital structure of RLV before the expiry date of the options.
Accordingly, the Takeovers Panel has granted an exemption for—
Fengli from rule 7(d) of the Code in respect of any increase in its voting control that results from the allotment of voting securities to it as a result of the allotment of the tranche 2 placement shares or the exercise by Fengli of its placement options to the extent that the notice of meeting does not comply with rule 16 (b) of the Code; and
RLV from rule 7(d) of the Code in respect of the notice of meeting.
The Takeovers Panel considers that it is appropriate to grant an exemption in respect of the proposed allotments and that the exemption is consistent with the objectives of the Code because—
it is impossible for the actual number of voting securities to be allotted and the relevant percentages required by rule 16(b) of the Code to be stated in the notice of meeting, since these numbers and percentages are dependent on a number of factors that will not be known with certainty until after the notice of meeting is prepared; and
the conditions require the non-associated shareholders to approve the maximum increase in control by Fengli as a result of the allotment of the tranche 2 placement shares and the exercise of the placement options; and
if the non-associated shareholders approve the potential maximum allotment of voting securities to Fengli, then, by implication, the shareholders also approve any lesser percentage of voting rights that may be allotted to Fengli as a result of the allotment of the tranche 2 placement shares and the exercise of the placement options.
Date of notification in Gazette: 20 November 2008.
Contents
1General
2Status of reprints
3How reprints are prepared
4Changes made under section 17C of the Acts and Regulations Publication Act 1989
5List of amendments incorporated in this reprint (most recent first)
Notes
1 General
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This is a reprint of the Takeovers Code (RLV No. 3 Limited) Exemption Notice 2008. The reprint incorporates all the amendments to the notice as at 1 January 2012, as specified in the list of amendments at the end of these notes.
Relevant provisions of any amending enactments that contain transitional, savings, or application provisions that cannot be compiled in the reprint are also included, after the principal enactment, in chronological order. For more information, see http://www.pco.parliament.govt.nz/reprints/
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2 Status of reprints
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Under section 16D of the Acts and Regulations Publication Act 1989, reprints are presumed to correctly state, as at the date of the reprint, the law enacted by the principal enactment and by the amendments to that enactment. This presumption applies even though editorial changes authorised by section 17C of the Acts and Regulations Publication Act 1989 have been made in the reprint.
This presumption may be rebutted by producing the official volumes of statutes or statutory regulations in which the principal enactment and its amendments are contained.
3 How reprints are prepared
A number of editorial conventions are followed in the preparation of reprints. For example, the enacting words are not included in Acts, and provisions that are repealed or revoked are omitted. For a detailed list of the editorial conventions, see http://www.pco.parliament.govt.nz/editorial-conventions/
or Part 8 of the Tables of New Zealand Acts and Ordinances and Statutory Regulations and Deemed Regulations in Force.
4 Changes made under section 17C of the Acts and Regulations Publication Act 1989
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Section 17C of the Acts and Regulations Publication Act 1989 authorises the making of editorial changes in a reprint as set out in sections 17D and 17E of that Act so that, to the extent permitted, the format and style of the reprinted enactment is consistent with current legislative drafting practice. Changes that would alter the effect of the legislation are not permitted.
A new format of legislation was introduced on 1 January 2000. Changes to legislative drafting style have also been made since 1997, and are ongoing. To the extent permitted by section 17C of the Acts and Regulations Publication Act 1989, all legislation reprinted after 1 January 2000 is in the new format for legislation and reflects current drafting practice at the time of the reprint.
In outline, the editorial changes made in reprints under the authority of section 17C of the Acts and Regulations Publication Act 1989 are set out below, and they have been applied, where relevant, in the preparation of this reprint:
•omission of unnecessary referential words (such as
“of this section”
and“of this Act”
)•typeface and type size (Times Roman, generally in 11.5 point)
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•layout of provisions, including:
•indentation
•position of section headings (eg, the number and heading now appear above the section)
•format of definitions (eg, the defined term now appears in bold type, without quotation marks)
•format of dates (eg, a date formerly expressed as
“the 1st day of January 1999”
is now expressed as“1 January 1999”
)•position of the date of assent (it now appears on the front page of each Act)
•punctuation (eg, colons are not used after definitions)
•Parts numbered with roman numerals are replaced with arabic numerals, and all cross-references are changed accordingly
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•case and appearance of letters and words, including:
•format of headings (eg, headings where each word formerly appeared with an initial capital letter followed by small capital letters are amended so that the heading appears in bold, with only the first word (and any proper nouns) appearing with an initial capital letter)
•small capital letters in section and subsection references are now capital letters
•schedules are renumbered (eg, Schedule 1 replaces First Schedule), and all cross-references are changed accordingly
•running heads (the information that appears at the top of each page)
•format of two-column schedules of consequential amendments, and schedules of repeals (eg, they are rearranged into alphabetical order, rather than chronological).
5 List of amendments incorporated in this reprint (most recent first)
Takeovers Code (RLV No. 3 Limited) Exemption Notice 2008 (SR 2008/433): clause 3