- Does this mean that PDN share holders are protected from the "New Note Holders" acquiring PDN's assets in the event that PDN defaults in the future?
Or..
- That this right has been wavered and share holders are not protected from New Note Holders acquiring PDN's assets in the event of PDN defaulting..?
And or...
- This means that the "New Note Holders" cannot directly acquire PDN's assets but are able to sell them to a 3rd party at "arms length"?
"Present Application
The Company will be issuing secured notes to certain of its existing creditors who are recapitalising the Company. It is possible that some of the Noteholders will be substantial shareholders in the Company. The Company proposes to grant the Noteholders the benefit of security over all or substantially all assets of the Company and certain subsidiaries. The use of the Company's assets as collateral constitutes the disposal of an asset for the purposes of Listing Rule 10.1. The Company is granted a waiver from Listing Rule 10.1, subject to a number of conditions, including that the security documents provide that in the event the security is exercised, a substantial holder nor any of their associates are entitled to acquire the assets without the Company first complying with any applicable listing rules, including Listing Rule 10.1. This condition provides a sufficient safeguard against value-shifting to a substantial holder (or their associates)."
Register of ASX Listing Rule Waivers
Column 1
Column 2
0
{colgroup}
1
{col}{/col}{col}{/col}
2
{/colgroup}
3
Rule Number
10.1
4
Date
20/12/2017
5
ASX Code
PDN
6
Listed Company
PALADIN ENERGY LTD
7
Waiver Number
WLC170416-001
8
Decision
1. Based solely on the information provided, ASX Limited ("ASX") grants Paladin Energy Limited (Subject to Deed of Company Arrangement) (the "Company") a waiver from Listing Rule 10.1 to the extent necessary to permit the Company to grant security over the assets of the Company in favour of noteholders to whom Listing Rule 10.1 applies ("Noteholders") (the "Security") pursuant to a security agreement between, among others, the Company and a security trustee who will hold the Security for the benefit of the Noteholders, without obtaining shareholder approval on the following conditions.1.1. The Security includes a term that if an event of default occurs and the Noteholders exercises their rights under the Security, neither the Noteholders nor any of their associates can acquire any legal or beneficial interest in an asset of the Company or its subsidiaries in full or part satisfaction of the Company's obligations under the Security, or otherwise deal with the assets of the Company or its subsidiaries, without the Company first having complied with any applicable listing rules, including Listing Rule 10.1, other than as required by law or through a receiver, or receiver or manager (or analogous person) appointed by the Noteholders exercising their power of sale under the Security and selling the assets to an unrelated third party on arm's length commercial terms and conditions and distributing the cash proceeds to the Noteholders or their associates in accordance with their legal entitlements.1.2. A summary of the material terms of the Security is made in each annual report of the Company during the term of the Security. 1.3. Any variations to the terms of the Security which is:1.3.1. not a minor change; or1.3.2. inconsistent with the terms of the waiver,must be subject to shareholder approval.1.4. The Company and the Noteholders must seek to discharge the Security when the funds advanced to the Company are repaid, or if it is not discharged, seek shareholder approval for the continuation of the Security for any further period.1.5. The Company immediately releases to the market an announcement which sets out the material terms this waiver, including:1.5.1. the Company's plans with respect to the repayment of the funds advanced under the new notes, and discharge of the Security, including the timeframe within which it expects the repayment and discharge to occur; and1.5.2. a statement of the reasons why the Company has chosen to obtain a financial accommodation from a Listing Rule 10.1 party rather than a lender that is not a related party or substantial holder, and the steps the Company's board has taken to satisfy itself that the transaction is being entered into on arms' length terms and is fair and reasonable from the perspective of the Company's securityholders.
PAGE 14 OF 23
Column 1
Column 2
0
{colgroup}
1
{col}{/col}{col}{/col}
2
{/colgroup}
3
Basis For Decision
Underlying PolicyListed entities are required to obtain the approval of security holders for an acquisition from, or disposal to, a person in a position to exercise influence over the entity of a substantial asset. The votes of securityholders who are parties to the transaction, and their associates, are not counted. Listed entities are required to obtain an independent expert's report on the fairness and reasonableness of the transaction and send it to securityholders to accompany the notice of securityholders' meeting. This rule protects securityholders from a value-shifting transaction with a person in a position of influence being undertaken by a listed entity without the disinterested securityholders having approved that transaction with the benefit of full information. The rule supplements the related party provision of the Corporations Act (or, in the case of foreign entities, the related party provisions of the law of their home jurisdiction).Present ApplicationThe Company will be issuing secured notes to certain of its existing creditors who are recapitalising the Company. It is possible that some of the Noteholders will be substantial shareholders in the Company. The Company proposes to grant the Noteholders the benefit of security over all or substantially all assets of the Company and certain subsidiaries. The use of the Company's assets as collateral constitutes the disposal of an asset for the purposes of Listing Rule 10.1. The Company is granted a waiver from Listing Rule 10.1, subject to a number of conditions, including that the security documents provide that in the event the security is exercised, a substantial holder nor any of their associates are entitled to acquire the assets without the Company first complying with any applicable listing rules, including Listing Rule 10.1. This condition provides a sufficient safeguard against value-shifting to a substantial holder (or their associates).Q
I believe PDN is a high, potential take over target.
I'm trying to work out if the change of ownership of shares to debt holders and "New Note Holders" from DOCA are now able to come in with a low-ball take over when they desire..?
Or... in the event of PDN defaulting are able to sell assets off, thus screwing over share holders again.?
PDN Price at posting:
20.0¢ Sentiment: Hold Disclosure: Not Held
(20min delay)
