573ed153-d90e-45e9-b353-61dda6279469.pdf
ASX Announcement 6 May 2016
I m p l e m e n t a t i o n o f C r e d i t o r s ' S c h e m e
Atlas Iron Limited (ASX:AGO) (Atlas or the Company) refers to the Company's creditors' scheme of arrangement which was approved by the Federal Court of Australia on 28 April 2016 (Creditors' Scheme). The Court's orders approving the Creditors' Scheme were lodged with the Australian Securities and Investments Commission on 29 April 2016.
Atlas is pleased to advise that it has implemented the Creditors' Scheme and has completed the following:
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Issued to the Term Loan B Lenders 6,229,503,087 fully paid ordinary shares and 4,513,986,260 Options exercisable at 7.5 cents (AUD) on or before 31 July 2017 (New Options - see Annexure B for terms and conditions), as approved by shareholders on 27 April 2016 and issued pursuant to a Creditors' Scheme;
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Atlas has reduced the principal amount it owes to its Term Loan B Lenders from ~US$267M in December 2015 to US$135M today;
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The maturity date on this reduced debt has been extended from December 2017 until April 2021;
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Atlas' annual interest bill will be reduced by around A$20M, or 65 per cent, effective from May 2016; and
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The Asset Coverage Ratio covenant has now been replaced with a more transparent requirement that Atlas has a minimum of A$35M in cash at the end of each month.
among other things
Appointment of New Directors
Mr Eugene I Davis, Mr Alan J Carr and Mr Daniel Harris (the New Directors) have been appointed as directors of the Company on implementation of the Financial Restructuring. Information about these New Directors is set out in Annexure A to this announcement.
Resignation of Mr Ken Brinsden and Mr Jeff Dowling
As foreshadowed in the Notice of Meeting sent to Shareholders, on implementation of the Creditors' Scheme, it was contemplated that the New Directors would be appointed as directors of Atlas and two of the existing Directors (other than David Flanagan and Cheryl Edwardes) would resign.
As a result, Mr Ken Brinsden and Mr Jeff Dowling have resigned as directors effective today. The Board would like to thank Mr Dowling and Mr Brinsden for their great service and wish them well in their future endeavours.
Atlas Chairman Cheryl Edwardes said: "The Atlas Board and Management would like to thank Ken and Jeff for their steadfast service, particularly over the past 18 months.
"We also welcome Eugene, Alan and Daniel as directors and look forward to working with them as we strive to ensure Atlas once again generates strong returns for shareholders."
Attachments
Annexure A: Information about the new Directors Annexure B: New Options Terms and Conditions Annexure C: Appendix 3Zs for directors who are resigning Annexure D: Appendix 3Xs for new directors
Investor Enquiries:
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Atlas Iron +61 8 6228 8000
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Tony Walsh
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Company Secretary
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Media Enquiries:
Read Corporate +61 8 9388 1474
Paul Armstrong +61 421 619 084
Important Notice
This announcement does not constitute an offer to acquire or sell or a solicitation of an offer to sell or purchase any securities in any jurisdiction. In particular, this announcement does not constitute an offer, solicitation or sale to any U.S. person or in the United States or any state or jurisdiction in which such an offer, tender offer, solicitation or sale would be unlawful. The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act"), and neither such securities nor any interest or participation therein may not be offered, or sold, pledged or otherwise transferred, directly or indirectly, in the United States or to any U.S. person absent registration or an available exemption from, or a transaction not subject to, registration under the United States Securities Act of 1933.
New Options - requirements for exercise
The New Options terms and conditions are set out in Annexure B. Under clause 7 (Method of Exercise of a New Option) of those terms and conditions, in order to exercise any New Options, a holder of New Options must provide a duly executed "representation letter" along with the applicable notice of exercise. The representation letter must be substantially in the form set out in Annexure 2 to this announcement.
The New Options are expected to be freely tradeable on ASX (subject only to clause 6 (New Options are Freely Tradeable and Expected to be Tradeable on ASX) of the New Options terms and conditions), so the Company encourages investors to carefully consider the terms of the representation letter before acquiring any New Options. If investors are unable to give a representation letter substantially in the form set out in Annexure 2, then the holder of New Options will not be able to exercise the New Options into Shares.
Annexure A Information about the new Directors
Information about the new Directors is set out in below.
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New Director
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Details
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Mr Alan J Carr
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Mr Carr is an investment professional with 20 years' experience with investing in and leading complex financial restructurings globally, as well as serving on boards of directors. He is currently the Chief Executive Officer of Drivetrain LLC, which he founded in 2013. Mr Carr also served as Managing Director at Strategic Value Partners UK LLP from 2003 to 2013. Prior to these positions, Mr Carr worked as an attorney at Skadden, Arps, Slate, Meagher & Flom, and at Ravin, Sarasohn, Baumgarten, Fisch & Rosen, specialising in corporate restructuring.
Mr Carr currently serves as a director of Tanker Investments Ltd, Midstates Petroleum Company, Inc., Brookfield DTLA Fund Office Trust Investor Inc, NewPage Corporation and Syncora Holdings Ltd. He also served on the board of directors of LightSquared Inc from 2013 to 2015. Mr Carr has served on various boards of other private companies in North America, Europe and Asia.
Mr Carr holds a Juris Doctor, cum laude, from Tulane Law School, New Orleans, USA and a Bachelor of Arts in Economics and Sociology from Brandeis University, Waltham, MA, USA.
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Mr Eugene I Davis
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Mr Davis is the founder, Chairman and Chief Executive Officer of PIRINATE Consulting Group, LLC, a privately held consulting firm specialising in turnaround management, merger and acquisition consulting, hostile and friendly takeovers, proxy contests and strategic planning advisory services for domestic and international public and private business entities.
Since forming PIRINATE in 1999, Mr Davis has advised, managed and served as a Chief Executive Officer, Chief Restructuring Officer, Director, Committee Chairman and Chairman of the board of a number of businesses operating in diverse sectors including metals, energy, oil & gas, import-export, mining and transportation and logistics. Previously, Mr Davis served as Chief Executive Officer of Total-Tel Communications, President, Vice Chairman and Director of Emerson Radio Corporation and Chief Executive Officer and Vice Chairman of Sport Supply Group, Inc. Mr Davis is also a director of Spectrum Brands, Inc., U.S. Concrete, Inc., WMI Holdings Corp, Hercules Offshore, Inc., and Genco Shipping & Trading Ltd.
Mr Davis began his career as an attorney and international negotiator with Exxon Corporation and Standard Oil Company (Indiana), and has also been as a partner at two Texas-based law firms, specialising corporate and securities law.
Mr Davis holds a bachelor's degree from Columbia College, a master of international affairs degree in international law and organisation from the School of International Affairs of Columbia University, and a Juris Doctor from the Columbia University School of Law, USA.
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Mr Daniel Harris
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Mr Harris brings a wealth of mining and resources industry experience to Atlas from a career spanning more than 35 years, having worked previously as Chief Executive Officer and Chief Operating Officer of Atlantic Ltd and Strategic Minerals Corporation's (formerly Union Carbide) vanadium business. Mr Harris has also worked for Evraz in Moscow as Vice President, Vanadium Assets. Mr Harris is currently an independent technical and executive consultant to GSA Environmental Limited in the United Kingdom.
Mr Harris holds a Bachelor of Science, Chemical Engineering from the University of Nevada, USA and is a graduate of the Executive Development Program at the Kellogg School of Management at Northwestern University, USA.
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Annexure B
New Options Terms and Conditions
Capitalised terms not defined in these terms and conditions have the meaning provided in Schedule 1 (Definitions) to the Notice of Meeting dated 21 March 2016 and released to ASX on 24 March 2016
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EXERCISE PRICE
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ENTITLEMENT
Each New Option entitles the holder ("Option Holder"), on payment of the Exercise Price and otherwise subject to the terms and conditions set out below, for one new Share (each a "New Option Share").
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OPTION PERIOD
The New Options will expire at 5.00pm (Perth time) on 31 July 2017 ("Expiry Date").
Subject to clause 7 (Method of Exercise of a New Option), New Options may be exercised at any time prior to the Expiry Date and any New Options not exercised will automatically expire on the Expiry Date. There is no obligation to exercise the New Options.
Atlas will, at least 20 business days before the Expiry Date, send notices to all Option Holders stating the name of the Option Holder, the number of New Options held, the number of New Option Shares to be issued on exercise of the New Options and reiterating the requirement that a duly executed representation letter, which is substantially in the form annexed to these terms and conditions, must accompany any "Notice of Exercise of Options" (as described more fully in clause 7 (Method of Exercise of a New Option) below).
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RANKING OF SHARES ALLOTTED ON EXERCISE OF AN OPTION
Each New Option Share issued on exercise of a New Option will, subject to Atlas' constitution, rank equally in all respects with the existing Shares then on issue.
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VOTING
The Option Holder will not be entitled to attend or vote at any meeting of the members of the Atlas.
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NEW OPTIONS ARE FREELY TRANSFERABLE AND EXPECTED TO BE TRADEABLE ON ASX
Subject to the Corporations Act, the ASX Listing Rules, Atlas' constitution and certain contractual restrictions for the purposes of the U.S Securities Act (set out in a "Transfer Deed" to be signed by each TLB Lender), the New Options are freely transferable and, subject only to ASX approving Atlas' application for quotation of the Options as contemplated by clause 8, expected to be freely tradeable on ASX.
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METHOD OF EXERCISE OF A NEW OPTION
Atlas will provide the Option Holder with a form of written notice that is to be completed and submitted to Atlas' Company Secretary at each time the Option Holder wishes to exercise the New Options in accordance with these terms and conditions ("Notice of Exercise of Options").
The Notice of Exercise of Options must state the number of New Options to be exercised, the amount of the aggregate Exercise Price to be paid by the Option Holder in respect of the applicable New Options ("Applicable Subscription Monies") and the number of New Option Shares to be issued on exercise of the applicable New Options. The Notice of Exercise of Options must be accompanied by payment in full of the Applicable Subscription Monies.