GOZA4 Sy

Ui
In the High Court of New Zealand
Auckland Registry

1so.
-

K
I Te Kati Matua 0 Aotearoa
Tamaki Makaurau Rohe?NC

CIV-2019-404—

UnderPart 19 of the High Court Rules and sections 239AT and
239ADO of the Companies Act 1993

In the matter ofan application pursuant to section 239AT of the Companies Act
1993 for an order extending the convening period by which theadministrators must convene the watershed meeting for
Tamarind Taranaki Limited (Administrators Appointed)

and in the matter ofTamarind Taranaki Limited (Administrators Appointed)

In the matter of an
application by

MW Mansfield and J A Kardachi
Applicants

Affidavit of Jason Aleksander Kardachi in support of originating
application without notice for order extending the convening period
by which the administrators must convene the watershed meeting for
Tamarind Taranaki Limited (Administrators Appointed)
Affirmed: 3 December 2019

KensingtonSwan°
18 Viaduct Harbour AvenuePri‘tate Bag 92101
Auckland 1142
Solicitor:
E

8052586 2

P +64 9 379 4196
F 4-64 9 309 4276
DX CP22001.1 A McMillan / M L Broadjames.mcmillan@kensingtonswan.com/mark.broad@kensingtonswan.com

OZA

et.

Affidavit of Jason Aleksander Kardachi in support of Origina
application without notice for order extending the convening mi_Od
by which the administrators must convene the watershed meefiiiij of
Tamarind Taranaki Limited (Administrators Appointed)
I, Jason Aleksander Kardachi, of Singapore, chartered accountant and insolvency
practitioner, affirm:
Background1

I am a managing di-ector of Borrelli Walsh and I am the second-named applicant
in this proceeding. I am also authorised to affirm this affidavit on behalf of
Mitchell Mansfield, the first named applicant in this proceeding.

2

I am familiar with the matters at issue in this proceeding. Annexed to this affidavit
as exhibit 'JAK-1' is a paginated bundle of documents which I will refer tc by
page number.

3

Cn 11 November 2019, Mr Mansfield and I were appointed administrators ofTamarind Taranaki Limited (Administrators Appointed) ('Tamarind'). Printouts
from the Companies Office website confirming our appointment are at pages 01
and 02 of the bundle. Tamarind operates the Tui oil field off the Taranaki coast.
It took over the oil field in 2017 and operates it using the Umuroa, a floating
poduction, storage and offloading vessel owned by BW Offshore Singapore Pte
L:d (13W0').

4

At the point at which Mr Mansfield and I were appointed administrators, Tamarindhad 117 creditors owed a total of US$231,647,512.57. Of this sum,
US$66,940,821.85 is owed to Orchard Capital Partners, which was granted ageneral security by Tamarind over all of its assets (subject to confirmation of thevalidity of the security). A further US$812,480.17 is owed to seven employees ofTamarind, of which US$152,200.20 is preferential debt

5

Pnor to our appointment, we applied to this Court for orders permitting us to act
as administrators, deed administrators or liquidators of Tamarind. I affirmed anaffidavit in support of that application, a copy of which is at page 03 of the bundle.
Those orders were granted and a copy of the Court orcers is at page 31 of thebundle.

18052586 2

Orders sought
6

In this application, Mr Mansfield and I seek orders:afor an extension of the convening period for Tamarind's watershed meetingby 41 working days, from 9 December 2019 to 17 February 2020, pursuant
to section 239AT(3) of the Companies Act;bthat we are able to convene the watershed meeting by notice of meeting
before the convening period (as extended) has expired, if we are able totake the necessary steps and form the necessary opinions before
completion of the extended convening period; andcthat leave is reserved for any creditor of Tamarind to apply to vary or set
aside these orders prior to the next hearing date.

Steps taken since our appointment as administrators of Tamarind
7

Since our appointment as administrators, we have:asecured Tamarind's assets whilst determining whether there is demand toeffect a sale of the business or its assets or third party funding available tofacilitate continued production;b

engaged in negotiations with key creditors and suppliers to ascertain
whether, and for how long, production at the Tui oil field can continue and tosecure that continuation on terms favourable to Tamarind;cheld the first meeting of creditors in New Plymouth on 20 November 2019.
At the meeting, the administrators highlighted to creditors that, depending on
the progress of the administration, they may need to extend the convening
period. A copy of the minutes of that meeting is at page 34 of the bundle;dterminated the employment of all of Tamarind's employees within 14 days of
appointment in order to limit our personal liability and re-engaged those
employees whose services are necessary to the continued operation of
Tamarind; and28052586 2

GOL1L,eSbbegun to investigate Tamarind's affairs, business, property, arkd financial
circumstances in order to form an opinion on the possible outcomes of theadministration (see s 239AE of the Act).

At pages 53-62 of the bundle is a copy of some media articles about the8administration of Tamarind.
The watershed meeting
9

Under section 239AT of the Act, we are required to convene a watershed meetingof creditors within the convening period, being 20 working days after the date of
our appointment. The convening period currently ends on Monday, 9 December
2019. The watershed meeting must be held within five working days after theend of the convening period (that is, by Monday, 16 December 2019). It is at thewatershed meeting that Tamarind's creditors will decide on the future of thecompany.

Extension of convening period for watershed meeting
10

Mr Mansfield and I consider that, to maximise the return to Tamarind's creditors,
a short extension to the convening period is required to 17 February 2020.

11

Since our appointment, we have been assessing the business of Tamarind andits assets and liabilities. Our view is that the best way to improve the return for
creditors and shareholders of Tamarind is for it to continue to produce oil from theTui oil field until, at least, the end of the current production cycle in January 2020.

12

If production can continue until that point, the oil can be uplifted and sold resulting
in a better return for creditors. At the same time, we can continue to explore
options for sale of Tamarind's assets or the availability of third party funding tofacilitate continued production by Tamarind beyond the current production cycle(possibly in conjunction with a deed of company arrangement).

13

In order to secure continued production, we have been in discussions with BWO
to agree an amendment of the contract for the operation and maintenance of the
Umuroa at the Tui oil field (the 'FPSO Contract').

14

The discussions have been positive and Mr Mansfield and I anticipate that we will
shortly enter into a variation agreement with BWO that amends the FPSO
Contract. The variation agreement will allow production to continue on terms
acceptable to both parties. However, a leak of oil at the Tui oil field has
increased the uncertainty surrounding production and this uncertainty will38052586 2

continue until at least 9 December 2019. The uncertainty has .Is mea Mti
have not been in a position to ascertain the interest in Tamarind'sassess oravailability of third party funding to facilitate continued production.
15-

On 22 November 2019, a small oil leak was discovered at the Tui oil field.
Production was immediately suspended until the cause of the leak could bedetermined and we could assess the risk of further leaks. On further inspection, it
was determined that the leak was caused by a cut in one of the lines between theseabed and the Umuroa. Mr Mansfield and I therefore instructed a full inspectionof the remaining lines by remote operated vehicle.

16

At the same time, we liaised with the Environmental Protection Authority (the'EPA') and other regulatory authorities to keep them appraised of the situation.
The EPA issued an abatement notice confirming that it required to review the fullinspection report before production could recommence.

17

Mr Mansfield and I initially believed that it would be possible to complete theinspection and reporting process in time to restart production on 1 December
2019. However, the weather has delayed the carrying out of the inspection. The
third party survey is to be carried out this week and the report is expected at theend of the week. Mr Mansfield and I understand that the earliest day on which
the EPA is likely to complete its assessment of the report and authorise therecommencing of production is 9 December 2019. Throughout, we will beworking closely with the EPA to ensure best practice is adhered to.

18

If the convening period is not extended, we will have to convene the watershedmeeting on 9 December 2019. On the same day we will need to circulate areport to Tamarind's creditors about Tamarind's business, property, affairs andfinancial circumstances. We will also need to provide a statement setting out our
opinion on, among other things, whether it would be in the creditors' interests forthe company to execute a deed of company arrangement or to be placed into
liquidation.

19

Due to the continuing uncertainty as to whether, and when, production at the Tui
oil field can recommence, we do not expect to be in a position to provide a usefulreport to creditors or advise them as to the options open to them in respect ofTamarind on 9 December 2019.

20

We require time to consider the outcome of the EPA's review of the survey report
and what effect it has on the viability of continued production. We do not expect
to receive confirmation from the EPA of their findings until on or around448052586 2

GOZAL,9 December 2019. The current timetable therefore does not allow cogof the EPA's findings before our report must be circulated to creditofe.,'-:Y /00,
21

C:\

Our report will also be more meaningful to creditors once we have had theopportunity to approach potential purchasers of Tamarind's assets to ascertain
the interest in those assets and to investigate the availability of third party funding
to facilitate continued production. We will be in a stronger position to do so once
we have secured the short term future of production at the oil field.

22

Mr Mansfield and I have suggested a 42 working day extension to the 20 working
day convening period. The length of the extension is designed to allow for any
delays in receiving authorisation to recommence production or any otherobstacles that arise. Further, the extension is over the Christmas holiday period
during which Mr Mansfield and I anticipate that we may have difficulty incontacting potential purchasers of Tamarind's assets, as well as creditors.

23

If the convening period is not extended, then we will be unable to properly advise
Tamarind's creditors on the options available to the company prior to thewatershed meeting. As such, there would be a higher probability of liquidators
being appointed to Tamarind at the end of the current convening period andfollowing the watershed meeting. Given the prospect of production
recommencing if further time is allowed and of the identification of parties
interested in Tamarind's assets (or of third party funding options), we consider
that liquidation at this stage would not be in the best interests of creditors ofTamarind, including employees.

24

There is a reasonable prospect that, if the convening period is extended, we will
be able to advise creditors in advance of the watershed meeting that production
has recommenced and of the funds available as a result. We may also be able toadvise creditors as to potential purchasers of Tamarind's assets or as to theavailability of third party funding to facilitate continued production beyond thecurrent cycle. In that case, the options for Tamarind and therefore the prospectsof a better recovery for the creditors will have increased.

25

If the orders sought are granted, we will endeavour to hold the watershedmeeting as soon as possible within the extended convening period.

26

In my view, the proposed extension to the convening period should not prejudice
creditors because:

8052586.2

OZAL

_
•-.:
a

., 7' i .i . ,iextending the convening period would increase the chances of production'.
continuing until January 2020 which would result in a better return to(1_, "
creditors than immediate liquidation;bcreditors who continue to supply goods and services to Tamarind during theperiod of our administration are protected by our statutory obligation to pay
for relevant amounts and have been kept informed as to the progress of theadministration;cTamarind's landlord will continue to be paid for occupation for Tamarind's
occupation of its New Plymouth premises;
all creditors will receive notice of this application and orders (if granted) bydemail or post (which is consistent with service of the orders that werepreviously granted in respect of our application under section 280 of theCompanies Act) and will have the ability to apply to vary or set aside theorders.
Appropriate that this application is made and determined on a without notice basis
and proposed service on creditors
27

I believe that it is appropriate for this application to be made and determined on a
without notice basis, because:aextending the convening period for a brief period should not prejudiceTamarind's creditors;bpersonal service of the application on Tamarind's known 117 creditors andseven employees would be a time-consuming and expensive, given theurgency of the application;c

If the orders sought are granted:i

within five working days a copy of this application and the Court'sorders will be given to creditors of Tamarind by:A

email, where an email address has been provided to Tamarind; orBpost, to the postal address provided by creditors in instanceswhere an email address has not been provided; and8052586 2r.

ii

posting notice on Borrelli Walsh's website (www.borrelliwalsh.com) on
the webpage iin respect of the administration of Tamarind;d

Any person (including Tamarind's creditors) will be able to apply to modify ordischarge the orders, on appropriate notice to the administrators.

28

At 1.40pm on 3 December 2019, Borrelli Walsh and its solicitors received anemail from the solicitor acting on behalf of DOF Management Australia Pty Ltd,
one of Tamarind's creditors, A copy of the email is at page 63 of the bundle.
The email referred to this application and requested that it be made on notice as
it was anticipated that the application would be opposed.

29

Mr Mansfield and I continue to hold the view that service on each of Tamarind's
creditors would be impractical and is unnecessary in the circumstances. We
consider that these creditors are sufficiently protected by the opportunity given tothem to apply to modify or discharge the orders once granted. As a courtesy,
though, we propose providing a copy of the application, when it is made, to:athe five creditors who are members of the creditors committee elected at thefirst meeting of Tamarind's creditors;b

DOF Management Australia Pty Ltd; andc

COSL Offshore Management AS, a further creditor of Tamarind which has
file a notice of opposition to the s280 application previously granted.

'

Imelda Julia Gozal S.H., M.K.n.
Registered by me, Waarmeking No.21/Rgst/XII/2019, on this day, 3 rd of
December 2019, in Indonesia.

8052586.2

Document Filings Details

Page 1 of I

'JAK-1'
Registered document
1250682 TAMARIND TARANAKI LIMITED
Registration Date and Time

12 November 2019 16:30:18

Document Type

Appointment of Voluntary Administrator

Presenter

Jason Aleksander KARDACHI ( SORRELL! WALSH LIMITED )One Raffles Place
Tower 2 #10-62
Singapore 048616
Singapore

Appointment of Voluntary Administrator
First Name

Jason

Middle Name

Aleksander

SurnameKARDACHI

Organisat on

BORRELLI WALSH LIMITED

Address

Level 17, Tower 1, Admiralty Centre, 18 Harcourt Road, Hong Kong

Phone

+65 65 66030795

Public Emailjk@borrelliwalsh.com

Appointed On

11 Nov 2019

Appointed By

2391- Board of Directors

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flu 1101AM

Imelda Julia Gozal S.H., M.K.n.
Registered by me, Waarmeking No.20/Rgst/XII/2019, on this day, 3fd of December 2019, inIndonesia.

01
http://app.companiesoffice.govt.nz/companies/app/ui/pages/companies/1250682/28583... 3/12/2019

Document Filings Details

Page 1 of 1

Registered document
1250682 TAMARIND TARANAKI LIMITED
Registration Date and Time

12 November 2019 16:30:18

Document Type

Appointment of Voluntary Administrator

Presenter

Jason Aleksander KARDACHI ( BORRELLI WALSH LIMITED )One Raffles Place
Tower 2 #10-62
Singapore 048616
Singapore

Appointment of Voluntary Administrator
First Name

Mitchell

Middle Name

Wayne

SurnameMANSFIELD

Organisation

BORRELLI WALSH LIMITED

Address

Level 17, Tower 1, Admiralty Centre, 18 Harcourt Road, Hong Kong

Phone

+1 345 3233278

Public Emailmim@borrelliwalsh.com

Appointed On

11 Nov 2019

Appointed By

239I - Board of Directors

02
http://app.companiesoffice.govt.nz/companies/app/ui/pages/companies/1250682/28583... 3/12/2019

In the High Court of New Zealand
Auckland RegistryCIV-2019-404-

I Te Kati Matua 0 Aotearoa
Tamaki Makaurau Rohe

Under

Part 19 of the High Court Rules and sections 239F, 239ACD,
280 and 286 of the Companies Act 1993

In the matter ofan application pursuant to sections 239F, 239ACD, 280 and
286 of the Companies Act 1993 for an order that Mitchell
Wayne Mansfield and Jason Aleksander Kardachi not bedisqualified from appointment as administrators, deedadministrators or liquidators of Tamarind Taranaki Limited

and in the matter ofTamarind Taranaki Limited

In the matter of an

M W Mansfield and J A Kardachi

application by
Applicants

Affidavit of Jason Aleksander Kardachi in support of originating
application without notice for orders that Mitchell Wayne Mansfield
and Jason Aleksander Kardachi be permitted to act asadministrators, deed administrators or liquidators
Affirmed: 4 November 2019

KensingtonSwan0
18 Viaduct Harbour Avenue
Private Bag 92101
Auckland 1142

P +6493794196
F +6493094276
DX CP22001

Solicitor: J A McMillan
Ejames.mcmillan@kensingtonswan.com

037990209 2

Affidavit of Jason Aleksander Kardachi in support of originating
application without notice for orders that Mitchell Wayne Mansfield
and Jason Aleksander Kardachi be permitted to act asadministrators, deed administrators or liquidators
I, Jason Aleksander Kardachi, of Singapore, chartered accountant and insolvency
practitioner, affirm:
Background1

I am a managing director of Borrelli Walsh and I am the second named applicant
in this proceeding. I am also authorised to affirm this affidavit on behalf of
Mitchell Mansfield, the first named applicant in this proceeding.

2

I am familiar with the matters at issue in this proceeding. Annexed to this affidavit
as exhibit 'JK-1'is a paginated bundle of documents which I will refer to by page
number in my affidavit.

3

I have Bachelor of Commerce and Bachelor of Economics degrees from the
University of Adelaide. I am a member of the Institute of Singapore Chartered
Accountants and a member of the Institute of Chartered Accountants of Australia
and New Zealand (CAANZ). I am also an associate member of the Insolvency
Practitioners Association of Singapore and the International Association of
Restructuring, Insolvency and Bankruptcy Professionals (INSOL). I have 25
years of corporate advisory and restructuring experience in the Asia Pacificregion. During this time, I have acted as Court Appointed Liquidator, Liquidator,
Scheme Manager, Receiver and Chief Restructuring Officer. A copy of mycurriculum vitae appears at page 01 of the bundle.

4

My colleague, Mitchell Mansfield, is a director of Borrelli Walsh based in the firm's
Cayman Islands' office. He has a Bachelor of Commerce degree from the
University of New England, Australia. He is a chartered accountant and is also amember of CAANZ and INSOL. Mr Mansfield is an official liquidator in the
Cayman Islands and a registered liquidator in Australia. He has acted on behalfof public and private companies across many sectors including mining,
resources, construction and manufacturing. A copy of Mr Mansfield's curriculum
vitae appears at page 06 of the bundle.

5

Borrelli Walsh is a leading international provider of restructuring, insolvency andforensic accounting services with offices throughout Asia and the Pacific. Borrelli

7990209.2

041

Walsh has led more than 20 restructuring of companies in the commodities, oiland gas and related services industry and managed approximately
US$10.5billion of restructured debt in the following jurisdictions, including
Australia, Bangladesh, Bermuda, BVI, Cambodia, Cayman Islands, Geneva,
Hong Kong, India, Indonesia, Malaysia, Netherlands, Nigeria, PRO, Rotterdam,
Sierra Leone, Singapore, Thailand, the UK and the USA.
Tamarind Taranaki Limited
6

This application relates to Tamarind Taranaki Limited (Tamarind). A company
extract and certificate of incorporation of Tamarind are at pages 09 and 11 of thebundle. Tamarind operates an oil rig in the Tui oil field off the Taranaki Coast.

7

While Tamarind's registered office is in New Plymouth, Tamarind is not a party tothis application and will not oppose it. The conflicts of interest relevant to thisapplication relate primarily to Mr Mansfield, Borrelli Walsh and me. We are based
overseas and the most convenient registry is Auckland.

8

The Companies Office website records Tamarind as having two directors, Ian
Angell and Michael Arnett. Mr Angell is resident in Malaysia and Mr Arnett isresident in Australia. Tamarind's sole shareholder is a Singaporean company,
Tamarind Resources Private Limited.

9

I understand that Tamarind has approximately 111 creditors including:
104 third party creditors owed a total of US$192,173,631; andii

10seven employees owed a total of US$105,664.

Tamarind is experiencing financial distress resulting from a number of factors,
including:11ithe continuing decline in the oil price;Ha recent failed drilling exercise in the Tui oil field; andHipoor performance by Tamarind's main drilling contractor.

The directors of Tamarind wish to appoint administrators to Tamarind as soon as
possible because they hope that the company's business can be restructured orsold and a better return achieved for creditors than would result from an
immediate liquidation of the company. Mr Mansfield and I have been asked by
the directors to act as administrators of Tamarind. We also expect we may need

4/6 \7990209.2

05

to act as deed administrators or liquidators of the company following thesubsequent watershed meeting of creditors in the administration of Tamarind.
12

Mr Mansfield and I have considered whether there are any matters that may
disqualify us from being appointed administrators, deed administrators or
liquidators of Tamarind pursuant to section 280 of the Companies Act 1993 (Act).

13

Borrelli Walsh, Mr Mansfield and I have not had any prior involvement with
Tamarind before its recent financial difficulties. However, as a result of these
difficulties, the Singaporean Borrelli Walsh office has been engaged by Tamarind
to provide professional services. In particular, Tamarind has instructed Borrelli
Walsh to assess and advise on options for the restructuring of Tamarind and I
have been directly involved in providing this advice.

14

On 31 October 2019, solicitors carried out a search on the Personal Property
Securities Register, on my behalf, for financing statements registered against
Tamarind. A copy of the search results appears at page 12 of the bundle. As at
31 October 2019, seven financing statements had been registered against
Tamarind including, on 27 June 2019, a financing statement in the name ofMadison Pacific Trust Limited (MPTL). The financing statement registered by
MPTL relates to securities granted by Tamarind in return for financing provided
by Orchard Capital Partners (OCP) as detailed below. Borrelli Walsh, Mr
Mansfield and I have had, and continue to have, a professional relationship with
OCP.

15

I have carried out internal searches in relation to the entities, other than OCP,
that have registered financing statements against Tamarind. I can confirm that
Borrelli Walsh, Mr Mansfield and I have not acted for any of these entities.

Provision of professional services to Tamarind
16

In October 2019, Tamarind appointed Borrelli Walsh as Independent Financial
Advisor. In this role, Borrelli Walsh has provided independent investigative
services to Tamarind, including a review of operations and advice on possible
turnaround solutions. A copy of a letter from Borrelli Walsh to Tamarind settingout the proposed scope of work and fees appears at page 15 of the bundle. I
have been directly involved in carrying out this work but Mr Mansfield has not.

17

Borrelli Walsh's work with Tamarind has afforded me an insight into thecompany's position and the steps that Mr Mansfield and I would need to be taken
in any administration or subsequent insolvency procedure.

7990209 2

06

Continuing business relationship with Orchard Capital Partners
18

OCP is an investment fund providing customised secured lending for small andmedium sized enterprises across the Asia Pacific Region. OCP is a secured
creditor of Tamarind through three investment vehicles: OL Master (Singapore
Fund 1) Pte. Limited, Orchard Landmark II (Singapore Fund 1) Pte Limited and
OCP Asia Fund III (SF 1) Pte. Limited.

19

Borrelli Walsh, Mr Mansfield and I have been engaged by OCP in relation tovarious matters since 2010. The relevant relationships are between OCP and
Borrelli Walsh's offices in Hong Kong, Singapore and Australia. There have beena total of eight engagements in the last two years, of which four are ongoing.
None of the engagements for OCP have related to Tamarind's affairs or theaffairs of its directors or shareholders or any group companies of Tamarind.
Further, none of these engagements have related to matters taking place in New
Zealand.

20

Neither Borrelli Walsh, Mr Mansfield or I have provided any services to OCP
about Tamarind, its directors or shareholder or about any group companies ofTamarind.

Application for permission by the Court to act as administrators, deedadministrators or liquidators of Tamarind21

Mr Mansfield and I are precluded from being appointed as administrators or
liquidators of Tamarind under sections 280(1)(ca) and 280(1)(cb) of the Act, due
to Borrelli Walsh's provision of services to Tamarind and our and Borrelli Walsh's
continuing business relationship with OCP.

22

Mr Mansfield and I will advise the Court if any further conflict arises in terms ofsection 280 of the Act between the date of any appointment as administrators ofTamarind and the watershed meeting of the company's administration.

23

Because of the conflicts identified above, it is necessary for Mr Mansfield and me
to obtain permission from the Court under sections 239F, 239ACD, 280(1)(ca)and 280(1)(b) of the Act to act as administrators of Tamarind. It is also necessary
for us to obtain permission from the Court to act as deed administrators or
liquidators of Tamarind, if appointed as such at a watershed meeting of creditors
in the administration of Tamarind. We respectfully seek the Court's permission toaccept appointment as administrators and deed administrators or liquidators (asthe case may be).

7990209.2

07

4

4(/

24

Mr Mansfield and I will provide a consent to act as administrators of Tamarind
after the Court has granted us permission to act as administrators of thecompany.

25

If the Court makes an order granting us permission to act as administrators ofTamarind, then I expect that Mr Mansfield and I will be appointed asadministrators of the company as soon as possible thereafter.

26

I am capable of, and will, carry out the role of administrator, deed administrator or
liquidator in an appropriately professional and independent manner. Similarly, Mr
Mansfield has confirmed to me that he will also carry out the role ofadministrator, deed administrator or liquidator in an appropriately professional
and independent manner.

Appropriate that this application is made and determined on a without notice basis
27

I believe that it is appropriate for this application to be made and determined on a
without notice basis, because:athere is no real conflict about our proposed appointment as administrators,
deed administrators or liquidators of Tamarind;bpersonal service of the application on Tamarind's 104 known creditors andseven employees would be time-consuming and onerous, given the urgencyof the application; andc

if Mr Mansfield and I are appointed as administrators of Tamarind, thencreditors:iwill be served with a copy of this application and the Court's orders at
the same time and in the same manner as notice of the first meeting ofcreditors under s239A0 is given by the administrators to thosecreditors;ii

retain the right to challenge our appointment as administrators ofTamarind in Court; and/oriii

may vote to replace us as administrators at the first creditors' meetingof the administration of Tamarind under s239AN of the Act.

Proposed service of orders on creditors

7990209 2

085

If orders are made permitting Mr Mansfield and me to be appointed

28

administrators of Tamarind, and we are subsequently appointed administrators of
the company, we propose to serve a copy of this application and the orders on all
known creditors of Tamarind notified of the first meeting of creditors in Tamarind's
voluntary administration pursuant to s239A0(1)(a) of the Act, at the same timeand in the same manner as notice under s239A0 is given by the administrators to
those creditors.
A copy of this application and the Court's orders will also to be posted on Borrelli

29

alsh's website.

ong Kong Special Administrative Region of the People's Republic offi med in th
China
on 4 November 2019
before me:

A person duly authoris d to take oaths in the Hong Kong Special Administrative Regionof the People's RepuLJic of China
LT SIU FUNGNOTARY PUBLICHONG KONG TAR
Unit 1303, 13/F.,
Tower 1, Admiralty Centre,
18 Harcourt Road,
Hong Kong.

,111

7990209 2

096

'JK-1'CURRICULUM VITAE

01
This is the exhibit marked 'JK-1'referred to in theannexed affidavit of JASON ALEKSANDER
KARDACHI affirmed at the Hong Kong Special
Administrative Region of the People's Republic ofChina this 4th day of November 2019 before me:

JASON ICARDACHI
Position :A person duly authorised to tale oaths in the
Hong Kong Special Administr ive Region of thePeople's Republic of China LI

Managing Director

Professional Affiliations and Academic Qualifications
•
•
•
•
•
•
•
•
•

LI SIU FUNGNOTARY PUBLIC
Approved Liquidator, Singapore
HONG KONGAR
Associate Member of the Insolvency Practitioners Association of SingtittelT3Agaty Centre,
ower , A
Member of the Institute of Singapore Chartered Accountants
18 Harcourt Road,
Hong Kong.
Member of the Singapore Institute of Directors
Member of the Institute of Chartered Accountants of Australia
Member of INSOL International
Past President and current board member of the Turnaround Management Association,
Singapore and South East Asia
Bachelor of Commerce, University of Adelaide
Bachelor of Economics, University of Adelaide

Career History
2010
2007
2006
2001
1994

:
:
:
:
:

Managing Director, Borrelli Walsh Pte Limited
Managing Partner, Teak Capital Partners Pte Ltd
Director, Head of Special Situations, HSBC
Senior Manager, Business Recovery Services, PricewaterhouseCoopers
Manager, Business Recovery Services, Arthur Andersen

Professional History
Jason Kardachi is a Managing Director based in the Singapore office and leads the firm's
restructuring, insolvency and forensic work in Singapore and South East Asia.
Jason has led and managed complex debt restructurings and turnarounds, liquidations andreceiverships and provided practical and commercial solutions to key stakeholders.
Jason is the founding member of the TMA Southeast Asia ("SEA") chapter and is the first
President of the regional TMA chapter. He was recently awarded the TMA International
Chapter Impact Award 2019 and is the first practitioner outside of the United States to havereceived an Individual award since the launch of the TMA Awards in 1993.
Before joining BorTelli Walsh, Jason was a Managing Partner of Teak Capital Partners, anadvisory and investment firm focused on special situation and distressed investments acrossAsia Pacific.
Jason has 25 years of corporate advisory and restructuring experience in Asia Pacific, the last
19 of which have been in Hong Kong and Singapore, initially at PricewaterhouseCoopers in
Business Recovery Services and then as Head of Special Situations Asia at HSBC.
Jason is a Chartered Accountant and has a Bachelor of Commerce and a Bachelor of
1

10

02

Economics from the University of Adelaide.
Significant Assignments•

Court appointed Liquidator of Humpuss Sea Transport Pte Limited, a substantial
Singapore and Jakarta-based shipping group, following an industry downturn and thesubsequent non-performance of several international charter hires. The group is facing
total claims of over US$140 million from ship owners in Greece, Korea and Norway.
The Liquidators obtained Chapter 15 orders in New York and recognition order by theHigh Court of Justice in London to stop the international legal proceedings against thecompany and thereafter pursued a dual strategy of reconstituting books, records andfinancial affairs of the company and realising the assets of the company including
through litigation internationally.

•

Liquidator to a Singapore-based company that provided management services tooffshore accommodation vessels valued at more than US$150 million. Following
enforcement by secured bondholders over the assets of the company, work involved
the investigation and analysis of disputes between key stakeholders and the pursuit ofrelated claims including those focussed on the time charter arrangements for thevessels.

•

Liquidator of Dovechem, a Singapore based chemical solvent distributor with
operations across Asia Pacific and turnover of more than SGD500m. Key aspects ofwork included detailed investigations and reconstruction of accounts to facilitate thevaluation of key assets and sale.

•Liquidator of Global Brands Group, a Singapore based global branding, licensing andintellectual property business with operations in 12 countries and tier one brand assets
funded by USD150m of debt. Key aspects of work included maintenance of
operations whilst the sale of business units were managed and then subsequent wind
down, interaction with the licensors in terminating the rights and enabling them tostep into those rights and liaising with licensees to effect same, detailed investigations
into the conduct of directors and management and various litigations arising out ofcontracts entered into by the company.

•

Scheme Manager and then Liquidator of Nutune, a Singapore-based tuner
manufacturer with operations in Singapore, Indonesia and PRC. Work included
review of operations with subsequent wind down followed by recovery of assets soldto strategic global buyers.

•

Liquidator to Singapore company, Timor Global Limited, which engaged in the
trading and processing of commodities internationally under a joint venture agreement.
Work focussed on undertaking detailed investigations into the conduct of the directors
and tracing the flow of funds between related entities and other JV partners, which
identified various legal claims available to the Liquidators.

•

Liquidator to Singapore technology companies GlobalRoam Group Limited("GlobalRoam Group") and its subsidiary GlobalRoam Pte Limited ("GlobalRoam")

2

11

03

which owned various patents relating to and provided communication andauthentication microservices to customers that allow hybrid connections via bothtraditional telecommunication infrastructures and digital networks. Role involved
taking steps to protect and preserve the Group's assets, establishing a reliable cash
flow forecast for the business, convening creditor meetings and successfully
undertaking a sale process for the business and/or assets of the Group in an efficientand cost-effective manner.
•

Liquidator to Singapore company, Marujyu Technology Pte Ltd, which was in thebusiness of reselling semiconductor chips and components. Work involved taking
steps to protect and preserve the Company's assets, establishing the creditors of thecompany, convening creditor meetings and undertaking all other statutory duties of a
Liquidator.

•

Scheme Manager of a Scheme of Arrangement of a Singaporean capital raising SPVof an Indonesian property group that issued USD155 million of bonds. Role involved
undertaking a financial assessment of the proposed restructuring of the bonds,
including whether the commercial terms of the Scheme were fair to creditors whencompared to the available alternatives such as enforcement of security. Also
facilitating the swapping of the bonds for shares in a related party IDX-listed entity,
as well as the issuance of warrants in the parent company PT Bakrieland
Development Tbk. We obtained 100% approval of the proposed Scheme at theCreditors Meeting, in one of the first Court approved Schemes under the revised
insolvency regime of Singapore's Companies Act 2016.

•

Receiver over the shares of a BVI-incorporated company which had a wholly owned
subsidiary Singapore company, which in turn owned 99.9% of the shares in an
Indonesian property development company. Work included securing control over theassets and developing an enforcement and realisation strategy, including by changing
the directors and commissioners of the BVI company, its Singapore and Indonesiansubsidiaries. We have undertaken an assessment of the Indonesian properties in
preparation for either an enforcement sale (following our taking physical possession)or negotiating a consensual restructuring or refinance of the loan with the relevant
stakeholders.

•Receiver over shares of a shipping and bulk trading company and directors of 18
subsidiary companies across various jurisdictions by an international bank. Work
involved taking control of and stabilising the businesses, managing the operations of
14 vessels (bulk carriers, LPG and chemical tankers, offshore support vessels) and30+ ongoing cargo voyages; establishing and reviewing short and long term cash flow
forecasts and needs; reviewing settlement proposals; ensuring compatibility ofavailable options with cash flow projections and other options (e.g. litigation);assessing the risks and associated opportunities; and successfully completing a saleprocess.

•

Chief Restructuring Officer ("CRO") and lead advisor to PT Berlian Laju Tanker Tbk,
a dual-listed (Singapore and Jakarta) Indonesian company with a global chemical
tanker fleet of 50 vessels operating globally from Jakarta, Hong Kong and US(Southport, Connecticut). The company has debt in excess of US$2 billion comprising
3

12

04

a senior secured syndicate of international banks, high yield USD bonds, convertible
bonds, IDR bonds, lease, derivative and trade claims. Work undertaken included
stabilising a crisis through implementation of vessel protection measures, cash flow
management, restructuring an underperforming fleet by removing (through lay up orsale) unprofitable vessels and contracts including realigning trade lanes, managementchanges and management information generation. Establishing a long term
restructuring proposal to accommodate a diverse lender and stakeholder groups in
Asia, New York, London and the Netherlands including preparation of forecasts
determining revised loan terms, new money requirements for working capital, cash
sweep mechanisms, and equity issuance. Negotiating terms and implementing
restructuring within the framework of a PKPU process in Indonesia, s210(10) in
Singapore and Chapter 15 in New York.
•

Appointed Chief Restructuring Officer of Global Beauty, a company providing
non-medical cosmetic treatment services with over 200 centers with 3,000 staff acrossSouth East Asia including Malaysia. Work involved review of operations to identify
businesses to retain, dispose or fix. This led to a sale of certain businesses in certain
countries to reduce overheads and losses, managing creditors to allow for improved
cash position and establishing communication channels with management for
approvals for commitment and payments and to develop and monitor restructuringinitiatives.

•

Chief Restructuring Officer of an aluminium and steel formwork construction
business with substantial operations in Malaysia and India. Work included
appointment as Director to operating company to manage cash flow and improve
supply chain. Restructuring included provision of new money facility andmanagement buyout. Appointed Independent Director post-restructuring to implementbusiness plan and facilitate an exit.

•

IFA to a bank syndicate and Scheme Manager of First Engineering, Singapore based
plastic injection moulder with operations in Malaysia, China and India. Following a
successful debt for equity restructuring our focus was on achieving an exit of the
bank's position through a targeted sale process whilst managing cash flows andoperational enhancements culminating in a sale of the business to a private equity
buyer.

•

Appointed replacement asset manager of a portfolio of 7 (primarily distressed)
investments located in China, Singapore and Malaysia valued at US$ 100m. Investee
industries include pharmaceuticals, aquaculture, manufacturing, shipping andtechnology. As asset manager of the fund and directors of the investments, our workrequired establishing and implementing a realisation strategy for each investment
through various strategies. Our work included establishing fund flows in respect ofmajor investments, ownership entitlement, investigation of the conduct of the fundmanager and establishing and recommending realisation alternatives.

•

Appointed as Director of a Singapore company by an investment fund withinvestments in shipping and aviation in excess of SG$200 million to assist in portfolio
management and realisation.

•

Appointed as a Director by a senior lender to implement the restructuring of a printing
4

13

05

business in Singapore including key management changes and negotiations andimprovement of key supplier arrangements resulting in stabilisation of business,
improved performance and ultimately sale via Receiver appointment.
•

Appointed to conduct a financial and operational review of a major Indonesian
forestry enterprise which led to our appointment as directors to implement a sale ofthe investment ultimately achieving a successful exit for the secured bondholder.

•

Lead advisor to PRC based top 40 company in the strategic acquisition andrestructuring of two HK listed companies (combined market cap HK$750m).

•

Restructure of HK based company including sale of intellectual property (HK$388m)
resulting in full recovery to creditors and stay of liquidation.

•

Advisor to a PRC company with revenues of US$20b on the strategic acquisition ofand restructuring of two HK listed companies.

•

Managed a team of 20 on the buy side advisory and due diligence of a portfolio of
NPL's based in Hong Kong and China with significant real estate collateral and abook value of US$1b.

•

Lead advisor in bid for Australian rail assets valued at AUD$250m including
determination of bid structure, financial modelling, due diligence, sourcing financeand reporting to board.

•

Restructuring and turnaround of Pope Perry, an Australian manufacturer of heavy
engineering equipment, including sale of underperforming business unit, reduction in
staff (25%), overheads (32%) and debt (US$10m).

•

Restructuring of an Australian national retailer (US$150m sales) including
management of operations, sale of non-core surplus assets, review of non-performing
business units and management restructure.

•

Advisor on the acquisition of an Australian commercial property portfolio purchased
for US$225m for a large superannuation fund.

5

14

06

CURRICULUM VITAEMITCHELL MANSFIELD

Position :Director

Professional Affiliations and Academic Qualifications

•
•
•
•
•
•
•

Cayman Islands Official Liquidator
Registered Liquidator, Australia
Member of Recovery and Insolvency Specialists Association (RISA) — Cayman
Islands
Member of the International Association of Restructuring, Insolvency & Bankruptcy
Professionals (INSOL)
Member of the Australian Restructuring, Insolvency and Turnaround Association(ARITA)
Member of Chartered Accountants Australia and New Zealand — Chartered
Accountant
Bachelor of Commerce, University of New England, Australia

Career History

Dec 2016
Dec 2016
May 2016
Jun 2013
Feb 2009
Mar 2007Jun 2005
Jun 2004

Director, Borrelli Walsh Pte LimitedStandard Chartered Bank (on secondment)
Sandhurst Trustees Limited (on secondment)
National Australia Bank (on secondment)
Senior Manager, McGrathNicol
Business Analyst, Amway of Australia and New ZealandIntermediate Accountant, PKF Chartered Accountants (now BDO)
Accountant, Hall Chadwick Chartered Accountants

Professional History

Mitchell is an appointment taking Director based in the Cayman office with over 14 years ofexperience across Australia, Asia, North America and the Caribbean.
Mitchell has acted on behalf of public and private companies, shareholders, funds, secured
and unsecured creditors on assignments across the financial services, shipping, retail,agriculture, pharmaceutical, property, mining, resources, construction and manufacturingindustries.
Prior to relocating to the Cayman office, Mitchell was based in the Singapore office, advisingclients across Asia and globally.
Mitchell has extensive experience delivering bespoke solutions in respect of complex crossborder restructurings, shareholder disputes and valuations, investigations and litigation.
Mitchell is a Chartered Accountant, Cayman Islands Official Liquidator and registered
Liquidator in Australia.
1

15

07

Significant Assignments•

Appointed Receivers by a Singapore based lender over marketable securities in an
Australian listed company. The company operated leisure and entertainment businesses
across the Asia Pacific region, including two casinos located in Cambodia and Vietnam.
Work included securing the marketable securities and working with the company toidentify a suitable and strategic investor to acquire the securities and repay theSingapore based lender.

•

Appointed Independent Financial Advisor by the parent company to a newly acquired
Indonesia company engaged in the business of wholesale trading and distribution ofelectrical equipment and other related products in Indonesia. Work involved assisting
the new shareholders in taking control of and understanding the operations and assets ofthe company, in particular the collection of outstanding overdue debts and realisinginventory on hand; and to assess recommend and implement available options for thebusiness — including restructuring, sale or winding-up of the business in order tomaximize shareholder value.

•

Appointed Independent Financial Advisor by a listed Norwegian company and its
Singaporean subsidiaries which provide seaborne transportation and logistics ofliquefied gases. The Group operates a fleet of 7 chemical tanker vessels and has debt
totalling approximately US$150 million. Work involved a review of the business tounderstand its operations and financial position, implementing cash and working capital
controls, establishing and reviewing short and long term cash flow forecasts andformulating refinancing and/or restructuring options.

•

Independent Financial Adviser to the senior lender of a facility advanced to VSC
International Pte Ltd totalling USD6 million. The borrower, through various relatedgroup entities, operated a fleet of chemical tankers. Work included formulating an
enforcement strategy which culminating in a settlement of the amounts outstanding.

•Independent Financial Adviser to a Bahraini construction company in the restructure of
approximately USD 21 million. Work included:•
establishing operational and financial position, developing financial model andprojections, reviewing short and long term liquidity forecasts;•
confirming short and long term funding requirements, including rolling 13-week
cash flow forecast;•assessing the recapitalisation options available to the group (including structuring
funding from the new shareholders);•
preparing recommendation to improve the company's operation such as to focus
on profitable projects, restructure the creditors' claims and establish a strong
management and financial control; andunderstanding capital expenditure and materials required for the company to•complete the projects.

•

Independent financial advisor to pharmaceutical roll-up of eight contract development
and manufacturing organizations (CDMO) facilities acquired from seven different
pharmaceutical companies. Work included review and independent valuation of
2

16

08

individual acquisition transactions, analysis of potential claims by company against
third party sellers, major customers and other significant parties, and assistance innegotiations with key creditors and constituencies. Work also included assistance tocompany and primary equity owner in litigation with dismissed management team,including review and analysis of third-party consultant's report, valuation and otherfinancial analysis in support of company's litigation claims, counterclaims and defences,and preparation of expert witness report and availability for depositions and court
expert testimony.

3

17

Page 1 of 2

09
8

NEW ZEALAND ) COMPANIEScomPApkES OFFICEREGISTER

Company Extract
TAMARIND TARANAKI LIMITED
1250682
NZBN: 9429036267743
Entity Type:NZ Limited Company

Incorporated:
Current Status:
Constitution Filed:Annual Return Filing Month:
FRA Reporting Month:

30 Oct 2002
Registered
Yes
February
June
Tamarind Resources Private Limited
Company
201634047M

Ultimate holding company:
Type of entity:
Registration number / ID:
Country of registration:
Registered office address:

Singapore
4 Robinson Road, #05-01, The House
Of Eden, Singapore, 048543, SG

Company Addresses
Registered Office
Level 6, 54 Gill Street, New Plymouth, 4310, NZ
Address for Service
Level 6, 54 Gill Street, New Plymouth, 4310, NZ
Directors
ANGELL, Ian
36-02 Cendana Condo, 1 Jalan Cendana, 50250 Kuala Lumper, Wilayah
Persekutuan, MY
ARNETT, Michael Norman
54 Crescent Road, Eumundi, Qld, 4562, AU
Australian company directorship
Director of an Australian company:
Australian company details
ACN:

Yes

118300217
NRW HOLDINGS LIMITED

Company name:Registered office address:

Level 16, 300 Adelaide Street,
Brisbane, Qld, 4000, AU

18

Page 2 of 2
100

NEW ZEALAND

COMPANIES

COMPAt IES OFFICE if REGISTER

Company Extract
TAMARIND TARANAKI LIMITED
1250682
NZBN: 9429036267743
Shareholdings
Total Number of Shares:

52,988,555

Extensive Shareholdings:

No52,988,555

UEN201634047M
Tamarind Resources Private Limited
4 Robinson Road, #05-01, The House Of Eden, Singapore,048543, SG

For further details relating to this company, check http://app.companiesoffice.govt.nz/co/1250682
Extract generated 29 October 2019 05:27 PM NZDT

19

11
8

NEW ZEALAND ) COMPANIES
LkAitS Oh-10E

REGISTER

Certificate of Incorporation
TAMARIND TARANAKI LIMITED
1250682
NZBN: 9429036267743
This is to certify that NEW ZEALAND OVERSEAS PETROLEUM LIMITED was incorporated under theCompanies Act 1993 on the 30th day of October 2002
and changed its name to AWE TARANAKI LIMITED on the 1st day of July 2008
and changed its name to TAMARIND TARANAKI LIMITED on the 1st day of March 2017.

Registrar of Companies
29th day of October 2019

Certificate generated 29 October 2019 05:29 PM NZDT

20

12

m 7 A More business

PERSONAL PROPERTYSECURITIESlEc

ci V Less work

REGISTERNI NEW ZEALAND BUSNESS NUMBER

Date generated: 31-October-2019 17:34
CORR-EXP-P006-01
Page 1 out of 3

Debtor Organisation Search Result
Search ID: 3698799

Time of Search: 31-Oct-2019 17:34:24

Records Found: 7

Search Criteria Incorporation Number: 1250682
Results are listed by date and time of PPSR registration, based on the search criteria, and do NOT establish
priority.

Financing Statement Registration Number: F28J56426A70C9Y1/5
PPSR Registration Date and Time:

05-Aug-2011 10:52:26

Expiry Date and Time:

07-Jul-2021 15:36:50

Debtor Details
Incorporation
NumberNZBNNEWPLYMOUTH

8668439429038041839 Company

TAMARIND TARANAKI LIMITEDNEW
PLYMOUTH

12506829429036267743 Company

W M PETROLEUM LIMITEDNEW
PLYMOUTH

9213989429037784447 Company

Debtor Name

City/Town

TAMARIND NEW ZEALAND PTY
LIMITED

Collateral

Debtor
Reference

Secured Party

All Present and After Acquired Personal Property

Organisation
Type

STEWART PETROLEUM CO LIMITED

Intangibles

Financing Statement Registration Number: FZ743BP1B296P698/6
PPSR Registration Date and Time:

05-Aug-2011 10:55:19

Expiry Date and Time:

06-Jul-2021 14:25:30

Debtor Details
Incorporation
NumberNZBNNEWPLYMOUTH

39918

9429040761701 Company

TAMARIND NEW ZEALAND PTY
LIMITEDNEWPLYMOUTH

8668439429038041839 Company

TAMARIND TARANAKI LIMITEDNEW
PLYMOUTH

12506829429036267743 Company

Debtor Name

City/Town

STEWART PETROLEUM CO LIMITED

Collateral

Debtor
Reference

Secured Party

All Present and After Acquired Personal Property

OrganisationTypeW M PETROLEUM LIMITED

Intangibles

MINISTRY OF BUSINESS,INNOVATION Fx EMPLOYMENT

New2ealanct Government

MiKINA WHAKATUTUKt

21

13

Date generated: 31-October-2019 17:34
CORR-EXP-P006-01
Page 2 out of 3

Debtor Organisation Search Result
Search ID: 3698799

Time of Search: 31-Oct-2019 17:34:24

Records Found: 7

Search Criteria Incorporation Number: 1250682
Results are listed by date and time of PPSR registration, based on the search criteria, and do NOT establish
priority.

Financing Statement Registration Number: FN76659J4Z1TJ770/6
PPSR Registration Date and Time:

05-Aug-2011 10:58:02

Expiry Date and Time:

05-Jul-2021 15:28:31

Debtor Details
Debtor Name

Debtor Reference Incorporation Number NZBNCity/Town

Organisation TypeSTEWART PETROLEUM CO LIMITED NEW PLYMOUTH

39918

9429040761701 Company

TAMARIND TARANAKI LIMITEDNEW PLYMOUTH

12506829429036267743 Company

W M PETROLEUM LIMITEDNEW PLYMOUTH

9213989429037784447 Company

Collateral

Secured Party

All Present and After Acquired Personal Property

TAMARIND NEW ZEALAND PTY LIMITED

Intangibles

Financing Statement Registration Number: F20JD13BA4722915
PPSR Registration Date and Time:

25-Jun-2018 10:45:10

Expiry Date and Time:

25-Jun-2023 10:45:10

Debtor Details
City/Town

Debtor Name

Debtor Reference Incorporation Number NZBNTAMARIND TARANAKI LIMITED NEW PLYMOUTH 919:TAMA.RIND

Collateral

1250682

Secured Party

Goods - Other

Organisation Type

9429036267743 Company

TEAM DOCUMENT LIMITED

Financing Statement Registration Number: FN1J58F23F259B09/1
PPSR Registration Date and Time:

28-Jun-2018 14:12:15

Expiry Date and Time:

28-Jun-2023 14:12:15

Debtor Details
City/Town

Debtor Name

Debtor Reference Incorporation Number NZBN
1250682

TAMARIND TARANAKI LIMITED NEW PLYMOUTH 2016630

Collateral

Secured Party

All Present and After Acquired Personal Property

Organisation Type

9429036267743 Company

STEEL AND TUBE HOLDINGS LIMITED

Goods - OtherI ISTRY OF BUSINESS,OVATION Et EMPLOYMENT

Newaaland Government

UNA WHAKAttllUnt

22

14

Date generated: 31-October-2019 17:34
CORR-EXP-P006-01
Page 3 out of 3

Debtor Organisation Search Result
Search ID: 3698799

Time of Search: 31-Oct-2019 17:34:24

Records Found: 7

Search Criteria Incorporation Number: 1250682
Results are listed by date and time of PPSR registration, based on the search criteria, and do NOT establish
priority.

Financing Statement Registration Number: FB7N RG2X293Y9954
PPSR Registration Date and Time:

27-Jun-2019 17:18:31

Expiry Date and Time:

25-Jun-2024 17:18:31

Debtor Details
Debtor Name

City/Town Debtor Reference

Incorporation Number

NZBN

TAMARIND TARANAKI LIMITED

Singapore

12506829429036267743 Company

Collateral

Secured Party

All Present and After Acquired Personal Property

Organisation TypeMADISON PACIFIC TRUST LIMITED

Financing Statement Registration Number: FY246K8CN4HB82P6
PPSR Registration Date and Time:

25-Oct-2019 13:15:18

Expiry Date and Time:

31-Dec-2019 13:15:18

Debtor Details
Debtor Name

City/Town

Debtor Reference Incorporation Number NZBNTAMARIND TARANAKI LIMITED New Plymouth

Collateral

1250682

Secured Party

All Present and After Acquired Personal Property

Organisation Type

9429036267743 Company

KINETIC WELL SERVICES LIMITEDAll Present and After Acquired Personal Property Except...
Goods - Other

INISTRY OF BUSINESS,NNOVATION Et EMPLOYMENTNew Zeala nd Government

I-10,0NA W, tAi, A7U1l2n,23

15BORRELLI WALSH
BOk1111.11.1 kVAI.S11
1,1•1% 1-11,

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16 H \ I<C,(,111V1 ROAD, HONG KONc,

r -652 371.1 .5,166

F • s,•_:
71T

By email (Ian.Angellgtamarindresources.com;Wailid.Wonggtamarindresources.com)
only
09 October 2019
Our ref: JK/MIM/796729
Tamarind Taranaki Limited,
Level 6, 54 Gill St. New Plymouth
4310 New ZealandAttention: Ian Angell and Wai Lid Wong

Strictly Private and Confidential
Dear Sirs,
Tamarind Taranaki Limited — Independent Financial Advisor
I.

We refer to the meeting between Ian Angell and Wai Lid Wong of Tamarind Resources
Limited ("Tamarind") and Jason Kardachi and Mark O'Reilly of this office on 9
October ("Meeting"), as well as email correspondence between these parties on oraround this date (together "Correspondence").

2.

Our understanding of this matter is relatively limited and is based primarily on theinformation provided during the Correspondence and other publicly available
information. We would welcome any opportunity to refine or expand the preliminary
approach set out herein when more detailed information can be provided to us.

3.

This letter sets out the proposed scope of work and our proposed fees.

Background4.

Tamarind Taranaki Limited (the "Company") is a wholly owned subsidiary of
Tamarind. The Company is the operator of the Tui Oil Field and a 37.5% shareholder
in the Tui Oil Field Joint Venture ("Tui"), with the remaining joint venture partners
also being wholly owned by Tamarind.

5.

The Tui oil field is located 50 kilometers off the coast of Taranaki, New Zealand. The
field consists of three subsea drill centers: Tui (2 production wells), Amokura (1production well) and Pateke (2 production wells) which are each tied back to the BW
Offshore FPSO `Umuroa' via Subsea Facilities.

6.

Tamarind is a privately held oil & gas company headquartered in Kuala Lumpur,
Malaysia, and is

WWW.HORPEIAIW \L.S11.(10M

24

16

BORRELLI WALSH

focused on developing, operating and improving under-exploited fields in Southeast
Asia and Australasia.
7.

Tui has been in production since 2007 and was acquired by the Company from theformer venture partners, AWE, New Zealand Oil & Gas and Pan Pacific Petroleum, in
2017.
In order to extend the life of the Tui field into the mid 2020s, the Company planned todrill multiple new development wells — one in each field to access bypassed oil. Thisdevelopment would side-track from existing well bores to access undrained oil. The
Company then entered into an agreement with COSL Drilling for the drilling operations.

9.

In September 2019, the Company suspended drilling operations at the Tui field, after
the first of the three planned wells ("Tui-3H") came up dry.

10.

The Company's primary ongoing contracts for the Tiii field inchide7
10.1 BW Offshore ("BWO") charter (FPSO) — while a new contract has been signed
on 16 September 2019, there exists a cancellation option which may be executedon or before 15 October 2019 which would terminate the contract effective 31
December 2019. BWO has a parent company guarantee against Tamarind with
an approximate value of USD13 million. A proposal to restructure arrangements
has been made to BWO and discussions are ongoing;
10.2 COSL contract (drilling) — No parent guarantee and can be terminated any timeon payment of USD5 million, or approximately USD3.9m if the contract is firstsuspended. In Mid-September following the failure of the initial drilling, thissuspension clause was invoked. COSL have issued a statutory demand which
expires shortly;
10.3 DOF provide offshore supply vessels —they have also issued a statutory demand
which expires shortly; and10.4 HNZ provide helicopters for transportation to the offshore site.
10.5 The Company is also expecting a GST refund (as part of the amounts spent for
the Tui drilling) of US$1.4 million in the coming weeks.

11.

As a result of the recent failed drilling operations and other commercial factors, theCompany wishes to appoint Borrelli Walsh Limited ("Borrelli Walsh") as Independent
Financial Advisor ("IFA") to assist in a review of the financial position of Tui and toestablish restructuring options available to the Company.

Scope of Work

2

25

fg

17
BORRELLI WALSH

19.

Our primary role as IFA is to ascertain an understanding of the Company's operationaland financial affairs, establish the restructuring options available and ourrecommendations.

13.

On the basis of the limited information currently available to us, we estimate that our
scope of work may comprise carrying out the matters set out below. We would welcome
any opportunity to refine or expand the preliminary approach set out herein when moredetailed information is available.
Review of financial & operating position
13.1

establish the Company's assets and liabilities including valuation;

13.2 review and analyse the terms and status of the debt facilities, security
arrangements and current overall indebtedness;
Working capital and cash flow
13.3 establish the current liquidity status of the Company including an assessment ofnear-term payment obligations, including those which are critical to theoperations of the Tui oil field;
13.4 understand and evaluate the current working capital position of the business,
including trade and capex creditors, amounts receivable from tax authorities,
prepayment agreements with Trafigura / other stakeholders and the value of
inventory on hand;
Preparation of forecasts
13.5 evaluate short- and long-term funding requirements, and prepare a robust shortterm cash flow forecast and refine the longer term financial model for theCompany;
13.6 establish capital expenditure requirements including abandonment costs,
material non-operating expenses and other cash obligations; and13.7

establish opportunities to improve profitability and reduce operating costs andoverheads.

Restructuring
13.8 communicate as necessary with trade and capex creditors and other stakeholdersof the Company with respect to the current situation and the work being
undertaken by Borrelli Walsh;13.9 assess the viable restructuring options based on cash flow and other projections
and recommend restructuring proposal(s); and
3

26

%*

18
BORRE LLI WALSH

13.10 establish the options available and recommend how to implement the
restructuring proposal including whether through informal consensus, an
Administration in accordance with section 239 of the NZ Companies Act 1993
act of one of more of the entities and or the appointment of Receivers.
Borrelli Walsh Team14.

Our directors are leading providers of insolvency and restructuring services throughout
the Asia Pacific Region and in recent times have played key roles in many of theregion's insolvencies and restructurings. They regularly undertake substantial andcomplex insolvency and restructuring assignments as receivers, independent financial
advisors, provisional liquidators, liquidators, directors and legal representatives (in the
PRC).

15.

This matter will be led by our Managing Directors Cosimo Borrelli and Jason Kardachi,
assisted by Director Mark O'Reilly, who will be assisted by other members of our team
where necessary.

16.

We have the resources available to commence the necessary work immediately.

17.

Information in relation to Borrelli Walsh is available at www.borrelliwalsh.com. Please
let us know if you require any further information in relation to Borrelli Walsh.

Fee Structure
18,

Like many other advisory firms, our fees are based on standard hourly rates calculated
by reference to the staff member's experience, seniority and responsibility and on theactual time required to complete the assignment.

19.

In order to keep costs as low as possible, more junior members of the firm will be
involved where appropriate. Set out below are our hourly rates for an assignment of
this nature:
USD/hourBorrelli Walsh
Director

1,040

Manager

600

Associate320

Accountant

200

90.

Our hourly rates are subject to periodic review and adjustment.

21.

We propose the following fee structure:
21.1 we will calculate our fees using the above hourly rates for the necessary work("Hourly Rates");

4

27

19
BORRELLI WALSH

21.2 we will cap our fees at USD50,000 ("Fee Cap") for the scope of work describedabove, which we anticipate will take approximately 15 days to complete;
21.3 we will invoice you immediately, for the full amount of the Fee Cap and work
will commence our work once this invoice has been paid;
21.4 should our costs as calculated using our Hourly Rates be lower than the Fee Cap,
you will be refunded the difference; and21.5 you will be invoiced separately upon completion of the work scope for any
reasonable disbursements in respect of our fees ("Disbursements").
21.6 Should our scope of work substantially increase beyond that set out in paragraph
12 above, we will discuss further fee arrangements with you.
Expenses
22.

You will need to make an allowance for our reasonable out of pocket expenses such as
any necessary travel and accommodation.

23.

Borrelli Walsh does not invoice its clients for staff travelling time, telephone calls,
facsimile transmissions, photocopying, stationery or administrative staff time.

24.

It is our practice to issue invoices for our expenses on a regular interim basis. All
invoices are due for payment within 30 days of issue.

Indemnity25.

We do not require an indemnity in respect of our engagement as described herein.

Conflict of Interest
26.

We confirm that we are not aware of any actual, potential or perceived conflict ofinterest (or any other matter), which prevents us from undertaking this assignment. If
we become aware of such conflict, we will notify you immediately.

Confidentiality
27.

The contents of this letter and the terms of engagement are confidential and should not
be disclosed to any other party without our express written consent.

Data Privacy
28.

Borrelli Walsh undertakes to observe the provisions of all applicable laws andregulations pertaining to personal data. Borrelli Walsh is committed to being a
responsible custodian of the information you provide to us and the information wecollect in the course of operating our business. Our offices and business entities share
information with each other for business purposes such as internal administration,
5

28

20

BORRELLI WALSH

billing, promoting our events and services, and providing you or your organisation withservices. For information on how we may collect, use, process and share your personaldata, please read our Privacy Policy, which can be found atwww.bo rrel I iwal sh.comiprivacy-pol icy/.
Anti-Money Laundering
29.

We will require information and documents in respect of the Company prior tocommencing the engagement. A detailed information request will be made when the
Company is in a position to commence the engagement. This will include (and not belimited to) accurate anti-money laundering ("AML") information.

30.

Set out below is a list of information and documentation for the Company that you
should provide to us:
30.1

Certificate of Incorporation;

30.2 Memorandum and Articles of Association (including all amendments filed);
30.3 group structure chart (if available);30.4 current Register of Members;
30.5 current Register of Directors and Officers;
30.6 any registers of mortgages, charges and other encumbrances;30.7 audited financial statements, if available, or details of the assets and liabilities;
30.8 if the member(s) are corporations, please provide the Register of Members ofeach member;
30.9 if the director(s) are corporations, please provide a list of authorised signatories
or the Register of Directors of each corporation; and30.10 KYC documents on the director(s) and ultimate beneficial shareholder(s).
Termination
31.

At any time during the term of the engagement, you or Borrelli Walsh may terminate
the engagement for whatever reason upon the expiry of 7 days' notice to be given inwriting to the other party. Termination will not affect any accrued rights.

32.

All sums payable to Borrelli Walsh in respect of this engagement will be payable tothem upon their termination.

6

29

f3**

21

BORRELLI WALSH

Commencement of this Engagement
33.

The engagement of BW as set out in this engagement letter will commence upon thesigning of the engagement letter and payment of the invoice as set out in paragraph 23.3.
You may terminate this engagement immediately upon written notice.

34.

Should you wish to do so or have any queries or require any further information, pleasecontact Mr Kardachi or Mr Bance. Their contact details are set out below:
Cosimo Borrelli
Jason Kardachi
Office Direct:+852 3761 3800
Office Direct:+65 6603 0795
Mobile:+852 9492 6393
Mobile:+65 9101 2123
Email:
cb@borrelliwalsh.com Email:jk@borrelliwalsh.com

Yours faithfullyon Kardachi
lanaging Director
Borrelli Walsh Limited

We agree and accept the terms of this engagement agreement

Name:
ANGELL
Title: ROBEtY)
IN CT kOlfEtTt
Authorised Representative

7

30

fg*

DUPLIC;JE
In the High Court of New Zealand
Auckland Registry
I Te Kati Matua 0 Aotearoa
Tarnaki Makaurau RoheCIV-2019-404-2445

UnderPart 19 of the High Court Rules and sections 239F, 239ACD,
280 and 286 of the Companies Act 1993

In the matter ofan application pursuant to sections 239F, 239ACD, 280 and
286 of the Companies Act 1993 for an order that Mitchell
Wayne Mansfield and Jason Aleksander Kardachi not bedisqualified from appointment as administrators, deedadministrators or liquidators of Tamarind Taranaki Limited

and in the matter ofTamarind Taranaki Limited, an incorporated company having
its registered office at Level 6, 54 Gill Street, New Plymouth,
4310

In the matter of an
application by

Mitchell Wayne Mansfield of the Cayman Islands and Jason
Aleksander Kardachi of Singapore, chartered accountants andinsolvency practitioners
Applicants,x. oF ific,,,c,•,,, AucKLAND c
..
..)

N.I.

...,./

Orders as to qualification of administrators.

...1„1 0

Date: I November 2019G•Z E A\-

KensingtonSwa nO
18 Viaduct Harbour Avenue
Private Bag 92101
Auckland 1142

P +6493794196
F +64 9 309 4276
DX CP22001

Solicitor: J A McMillan
31E
james.mcmillanAkensingtonswan.com

Orders as to qualification of administrators
To:

Mitchell Wayne Mansfield and Jason Aleksander Kardachi.

1

The originating application made by Mitchell Wayne Mansfield of the Cayman

0, H

•

Islands and Jason Aleksander Kardachi of Singapore, both charteredaccountants and accredited insolvency practitioners, on 5 November 2019, was

AUCKLAND C\
N.Z.

Sf-0 •

determined by The Honourable Justice Jagose on November 2019.
2

The determination was made without a hearing.

3

The following orders were made:athe application be permitted to be made by way of an originating application;b

notwithstanding s239F(2), ss280(1)(ca) and ss280(1)(cb) of the Companies
Act 1993 (Act), Mitchell Wayne Mansfield and Jason Aleksander
Kardachi of Borelli Walsh (Proposed Administrators) may be appointed
as joint and several administrators of Tamarind Taranaki Limited(Tamarind);notwithstanding 5239ACD(2), ss280(1)(ca) and ss280(1)(cb) of the Act, theProposed Administrators may be appointed as joint and several deedadministrators or liquidators of Tamarind, if appointed as such at awatershed meeting of creditors in the voluntary administration of Tamarind;din the event that the Proposed Administrators are appointed asadministrators of Tamarind, then:ithis application be adjourned to a date convenient to the Court;ii

a copy of this application and orders of the Court be served on all
known creditors of Tamarind notified of the first meeting of creditors inTamarind's voluntary administration pursuant to s239A0(1)(a) of theAct, at the same time and in the same manner as notice under s239A0
is given by the administrators to those creditors, with a copy of thisapplication and the Court's orders also to be posted on Borelli Walsh's
website;

ri•,'

iii

the administrators' notice to creditors under s239A0(1)(a) of the Act
shall include advice to creditors of the next mention date of thisapplication, and advice that, if they wish to challenge the interim orders

32

1

made, they are entitled to do so by filing and serving a notice of
opposition within 10 working days of service of the Court's orders to set
aside the Proposed Administrators' appointment as administrators ofTamarind; andiv

the creditors of Tamarind shall have leave to apply to the Court within
10 working days of service of the Court's orders to set aside the
Proposed Administrators' appointment as administrators of Tamarind;andthe Proposed Administrators' solicitor-client costs and disbursements of thisapplication are to be an expense incurred by the Proposed Administrators incarrying out their duties as administrators of Tamarind.

'

N.Z.EJ•-y„

Date: j November 2019

Jail SINGH
Deputy Registrar
High Court
Auckland33

2

TAMARIND TARANAKI LIMITED(ADMINISTRATORS APPOINTED)NZBN: 9429036267743(“Company”)
MINUTES OF FIRST MEETING OF CREDITORS OF THE COMPANYHELD ON 20 NOVEMBER 2019 AT 10.00AM (NEW ZEALAND TIME) AT THE
DEVON HOTEL AND CONFERENCE CENTRE, 390 DEVON STREET EAST, NEW
PLYMOUTH 4312, NEW ZEALANDPRESENTName
Jason Aleksander Kardachi
Wai Lid Wong
Monique Sigvertson
Rebecca Hopson
Mark O’Reilly
Éanna Brennan
James McMillan
Creditors
Observers
INTRODUCTION

Designation / Representing
Chairman of Meeting, nominated Joint and Several
Administrator of the Company
Chief Operating Officer of Tamarind Group
Finance & Commercial Manager of the Company
Assistant Accountant of the Company
Administrators’ Officers
Administrators’ Officers
Solicitor acting for administrators
Refer to Attendance Sheet (Appendix A)
Refer to Attendance Sheet (Appendix B)
The meeting of creditors for Tamarind Taranaki Limited(Administrators Appointed) ("Company") was being held
pursuant to Section 239AN of the Companies Act 1993(“Companies Act”).
The nominated joint and several administrators of theCompany, Mr. Jason Aleksander Kardachi ("Mr.
Kardachi") introduced himself and informed that the othernominated joint and several administrator, Mr. Mitchell
Mansfield ("Mr. Mansfield") was absent with apologies.
Mr. Kardachi took the chair of the meeting.

NOTICE OF MEETINGThe Chairman advised that notice of this meeting had been
sent to all known creditors of the Company on 12
November 2019 pursuant to Section 239AO(1)(a) of theCompanies Act and that such notice was advertised in New
Zealand Gazette, New Zealand Herald, Dominion Post
and the Taranaki Daily News on 14 November 2019
pursuant to Section 239AO(1)(b) of the Companies Act.

34

ATTENDANCE / QUORUM

Pursuant to Schedule 5 of the Companies Act, a quorum
for the meeting of creditors is present if:•

three creditors who are entitled to vote or their proxies
are present or have cast postal votes; or•if the number of creditors entitled to vote does notexceed three, the creditors who are entitled to vote, or
their proxies are present or have cast postal votes.

The Chairman advised that he had received the attendanceregisters and the proxy forms and confirmed a quorum waspresent at the meeting and declared the meeting open at
10.08am (New Zealand time).
PROXIESThe Chairman informed that in receiving creditor claims
and proxy forms, the Administrators reserve the right tore-examine any of the documents should a dispute arise inrelation to the voting.
For the purposes of voting at the meeting, theAdministrators may estimate the amount of any creditor
claim that is for any reason uncertain. For the avoidanceof any doubt, the creditor amounts admitted by the
Administrators are for voting purposes only and shall not
be construed as the Administrators confirming the validity
or amount of any creditor claims – the Administrators will
review and adjudicate creditor claims and notify creditorsof their assessment in due course.
The Chairman shared that 36 proxies were received by the
Chairman within the required timeframe and have been
accepted as valid proxies.

OBSERVERS

The Chairman informed that there may be observers at themeeting. Unless any objections are received, theseobservers will be permitted to remain in the meeting but
will not be entitled to ask questions or cast votes.
Creditors who dialed in to the meeting will be consideredas observers.

PURPOSE OF THE
MEETINGThe Chairman explained the purposes of the first meetingof creditors were as follows:•

to provide an update on the Administrators’ work todate and path forward; and35

•

TABLING OF
DOCUMENTS

ADMINISTRATORS’UPDATEto attend to the formal business of the meeting whichis largely procedural and prescribed by statute – thatis, for creditors to consider two resolutions:- whether to replace the administrators; and- appoint a creditors’ committee and, if so, toappoint its members.

The Chairman informed the creditors that copies of thefollowing documents were on the table:•

a statement prepared by the directors of the Company
about the Company’s business, property, affairs andfinancial circumstances dated 18 November 2019;•consent to act as Administrators from Jason Kardachi
and Mitchell Mansfield;•

interests statement of Administrators dated 12
November – this is a statement disclosing therelationships the Administrators have with theCompany, its officers, shareholders, or creditors;•

DIRRI - a requirement by the Restructuring Insolvency
and Turnaround Association of New Zealand Inc. tomake declaration as to the Administrators’
independence, relationships and any indemnities
given, or up-front payments made to the
Administrators;•

proxies received; and•details of Administrators’ remuneration which is aschedule of Borrelli Walsh’s hourly rates.

The Chairman explained that Mr. Mansfield and himself
were appointed administrators of the Company pursuant
to a Directors’ resolution under Section 239I of theCompanies Act.
The Chairman also informed those present in the meetingthat the purpose of the voluntary administration is to seek
to maximise the prospects of the Company continuing its
business or, if this is not possible, to achieve a better returnfor the Company’s creditors than would result from an
immediate liquidation of the Company.
The Chairman then shared a short overview of theCompany’s background and key recent developments
leading to the current situation. The Chairman indicatedthat it may be necessary to seek from the Court an36

extension to the convening period for the watershedmeeting.
QUESTONS ANDANSWERSThe Chairman opened questions to the floor andrequested the creditors to state their names, and if they
are representing a company, the name of the company,
followed by their questions.
Refer to Appendix C.

DIRECTOR’SSTATEMENT OF AFFAIRSAND FINANCIALOVERVIEWThe Chairman tabled the Directors’ Statement ofCompany’s Position dated 18 November 2019 received
from Ian Angell, the director of the Company, andprovided an overview of the assets and liabilities of thejoint venture which includes the Company, Stewart
Petroleum Co Ltd, Tamarind New Zealand Pty Ltd andW M Petroleum Ltd (“Tui Joint Venture”), including
the following:•

total assets of the Tui Joint Venture have a bookvalue of USD177,632,763.07, comprising cash,
receivables, inventories, oil & gas assets and tax
assets;•total liabilities of the Tui Joint Venture held a bookvalue of USD155,311,232.58, comprising accounts
payable, payroll, intercompany loans, provisions,short term loans and abandonment & tax liabilities;
and•the net assets of the Tui Joint Venture held a bookvalue of USD22,321,530.49.

The Company’s share of the book value of the Tui Joint
Venture’s net assets is USD8,370,573.93, which
represents 37.5% of the joint venture’s net assets of
USD22,321,530.49.
The Directors advised that the primary causes of theCompany’s current financial and operational distressinclude:•a deterioration in oil prices;•

the suspension of the drilling programme after firstwell, Tui-3H, came up dry; and•the operational wells being near end of life andabsent a restructuring of one of the key supplier’s

37operating costs and further drilling/exploration
investment in Amokura and Pateke, the economic
viability of the reserves is estimated to end in March
2020.
The Chairman advised that the assets of the Tui Joint
Venture may not be recoverable and the estimatedrealisable value of the total assets is computed to be
USD12.2m. This leaves the Tui Joint Venture withestimated net liabilities of USD143.1m.
VOTING PROCEDURES

The Chairman informed the meeting that resolutions
put to creditors are first to be resolved on a show ofhands. If unanimous consensus is not reached on a
resolution by show of hands, then a poll will be
conducted.
A resolution is adopted if:•

the majority of the number of creditors voting(whether in person, by proxy or by post) vote infavour of the resolution; and•the value of the debts owed by the Company tothose voting in favour of the resolution is at least
75% of the total debts owed to all creditors voting.

If the number of creditors voting for and against a
resolution is equal, then the chair may exercise a casting
vote.
RESOLUTION A:
REMOVAL OFADMINISTRATORSThe Chairman advised that DOF Deepwater A/S(DDAS) has previously nominated David Ruscoe andRussell Moore of Grant Thornton to be replacementadministrators, but their nomination was withdrawn. As
such, there was no alternative administrator put forward
prior to the creditors' meeting and the creditors present
at the meeting did not nominate any other individuals.
As there were no other nominations, the Chairman
declared that the resolution to remove theadministrators would not be tabled and Mr. Kardachi
and Mr. Mansfield of Borrelli Walsh would remain the
Administrators of the Company.

RESOLUTION B:
CREDITORS’COMMITTEEThe Chairman gave a short introduction of the duties andfunction of the creditors’ committee as follows:38•essentially, the creditors’ committee will consult with
the Administrators about matters relating to theadministration and to receive and consider reports by
the Administrators;•

the creditors’ committee would act on a "pro-bono"basis, therefore the members of the creditors’committee will not be remunerated for the
performance of their duties; and•being elected by the creditors, members of thecreditors’ committee represent the body of creditors
and the decisions thereto.

5 creditors nominated themselves to sit on the creditors’committee.
The Chairman confirmed to the meeting that thoseindividuals who have been nominated as members of
the creditors’ committee are eligible to be members of
the committee.
The Chairman proposed the following resolution:“That a creditors’ committee be appointed for theadministration of Tamarind Taranaki Limited.”
The Chairman asked for a show of hands in favour of
the resolution. Several creditors raised their handvoting ‘yes’ for the formation of a Creditors’Committee. The Chairman asked for a show of funds‘against’ the resolutions - as no hands were raised‘against’ the formation of a Creditors’ Committee, theChairman declared resolution B has been carried
unanimously and the creditors will then have to vote on
the nominees of the creditors’ committee.
RESOLUTION C:
NOMINEES FOR
CREDITORS’COMMITTEEThe Chairman proposed the following resolution:“That the creditors’ committee be comprised of thefollowing creditors:”
Creditors Committee
Member
Timothy Lindsay
Hamish Manson

39

Representing
Creditor/s:
Trendsetter Vulcan
Offshore, Icon
Engineering Pty Ltd,AS Mosley & Co. Ltd
HNZ New Zealand
LimitedMark Tudor
Peter Hart
Nick KingBW Offshore
Singapore Pte. Ltd.
SGS New Zealand Ltd
Halliburton New
Zealand

The Chairman asked for a show of hands in favour of
the resolution. The majority of creditors present raised
their hand voting ‘yes’ for the above parties to beapproved as the members of the Creditors’ Committee.
The Chairman asked for a show of funds ‘against’ theresolutions - as no hands were raised, the Chairman
declared resolution C has been carried.
END OF MEETING

There being no other business, the Chairman thanked
those present for their attendance and declared the meetingclosed at 11.08am (New Zealand time).

Confirmed byDated this 27th day of November 2019________________________
Chairman of Meeting
Jason Aleksander Kardachi
Enclosures:
1.
Attendance Sheet of Creditors (Appendix A)
2.
Attendance Sheet of Observers (Appendix B)
3.
Questions and Answers (Appendix C)

40

41

(see next page)

Appendix A: Attendance Sheet of Creditors

Name of Creditor

No.

42

2

Merquip Ltd

3

Worley New Zealand Ltd

4

Tasman Oil Tools Ltd

5

Fugro NZ Ltd

6

Trident Australia Ply Ltd

7

Atlas Professionals

8

Kingston Offshore Services Ltd

9

Armottrguard Security

10

Icon Engineering Pty Ltd

11

NRG Well Examination Limited

12

Seismic Survey Ltd

13

The Information Management Group

14

Taranaki Office Products

15

Todd Energy Limited

16

Trendsetter Vulcan Offshore, Inc17

HNZ New Zealand Ltd

18

Alpha Customs Services Ltd

19

Baker Tilly Staples Rodway Taranaki Limited

20

Elemental Group

21

Kinetic Well Services Ltd

Signature o Perk n Attending

Name of Proxy / Attorney

Proxy Provided - Y/N

FEE

th-M-1

tq14/i-1/eAvedleit

IC Ai-

Art/ 740017. 1

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-72

VI 4

Az1›,11-Pvt

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Page 1 of 6

6;r

772

-

No.

Name of Creditor

22

Onyx iES Sdn. Bhd.

23

M /Iamb Excavating Limited

Proxy Provided - YIN

Name of Proxy / Attorney

Signature of Person Attending

24

25

Welltec Oilfield Services Pty Ltd

26

27

43

28

COSL Offshore Management AS

29

OneSubsea Australia Pty Ltd

30

Sehlumberger New Zealand Ltd

31

DOE Deepwater A/S

32

IOT Group Ltd

33

Ministry of Business Innovation and Employment

34

Tenaris Global Services S.A.

35

Poona= Oilfield Services--1

Jekcit 0 014/.c.s

44

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Scsa cil

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14
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36

7

Ilalliburton New Zealand(--

4....—..---31
4/37

I

DOE Management Australia Pty Ltd

38

SGS New Zealand Ltd

39

Industrial Lubricants and Services Limited40

BW Offshore Singapore Pte. Ltd.

41

Oceaneering International GMBH

42

Ocean Reach Advisory Pty Ltd

43

Awe Holdings NZ Limited

7::,,..„-, /4,4R-7-7,

1"

if
11/

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Page 2 of 6

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Signature of Person Attending

1

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__.

Symons Energy Services Ltd-S

Symons Transport_I54)_____, >r,)--->Franks Oilfield Services (Aust) Pty Ltd

Name of Proxy / Attorney.

f j

49

Maritime New ZealandTitan Cranes Limitedk,

47

The Flag Shop Limited

Proxy Provided - YIN

(I!)

46

Port Taranaki

Hayden Quinn

Name of Creditor

I\

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4), -i - -ra--- JAS--' 7 —e?

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No.

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66
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67

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1 11

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69

70

Name of Proxy/ Attorney

[

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Proxy Provided - Y/N

IQ Z.

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72

73

74

75

45

76

77

78

79

80

81

82

83

84

85

86

Page 4 of 6„._„_---->:72-1,c(ci--,/\ --)c_ticci_

71

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Signature of Person Attending

pv

r

,v

41:

-..-C., ,46Company

Welltec Oilfield Services Pty Ltd

Expro Group Australia Pty Limited

Neo Products, LLC

Tenaris Global Services S.A

Ocean Reach Advisory

No.

1

2

3

4

5

Appendix B: Attendance Sheet of Observers

47

Answer (All Answers Provided by Administrator Jason
Kardachi)

Borrelli Walsh has worked for OCP in various matters and places fora number of years. Essentially, in situations like this, we go in as anindependent financial advisor to assess the situation and restructuringoptions available for the companies where OCP is a major lender.

SB: Please explain the extent and nature of that relationship.

SB: Any understanding with OCP as to outcome?

No.

SB: What discussions were there with OCP about plans for Tamarind There was hardly anything. OCP simply introduced Borrelli Walsh to
and TTL before Borrelli Walsh accepted the IFA appointment?
the Company and we were then engaged by the Company (not OCP).

Yes.

SB: Does Borrelli Walsh have a relationship with OCP?

Question from Scott Barker (SB), acting on behalf of DOF: Does Yes.
OCP have security over a range of companies including the Tui
companies?

Question from Stu Barraclough of Todd Energy: Are you able to Yes, OCP is owed a lot of money and they have the primary economic
cut a deal? Is it a long way before OCP’s debt is satisfied?
interest here. However, it is true to say that any cash that is generated
will go to the key suppliers because we are cutting deals with them tocontinue operating. If there is any cash left, it would go to the secured
creditors. We are still in discussion with OCP – if OCP wants to keep
this viable on a longer term basis, OCP would also have to make a deal
with the unsecured creditors.

Question

Appendix C: Questions and Answers

48

Answer (All Answers Provided by Administrator Jason
Kardachi)Yes.

SB: What investigations are you going to undertake in respect of From my understanding, the funding from OCP came in around June
whether the Tamarind companies were solvent when OCP granted 2019. We have made enquiries about whether security is valid and the
security looks like it is valid because fresh funds were advanced.
security?
There is a hardening period before security is effective unless newmoney is advanced, which appears to be the case here. The money wasused to acquire TAG onshore assets and refinance existing lender
Trafigura and working capital. The obligations of an administrator toinvestigate are fairly general. When we put up a proposal to creditors,
we will need to compare the outcome in liquidation and consider
whether there may be available claims, including whether the directors
are liable for insolvent trading under New Zealand law. In any event,

SB: Security was granted in June 2019 to OCP?

SB: Before you were appointed as IFA or VA, were there any No, OCP has just introduced Borrelli Walsh to the Company. The
Company had been running around in circles for a number of weeks,arrangements with OCP, understanding or waiver?
trying to work out what to do. The Company talked to Australianinsolvency practitioners and McGrathNicol in New Zealand. From myunderstanding, they were not prepared to take the appointment.

SB: OCP can appoint a receiver over TTL’s assets. Any discussions Yes, we discussed the possibility of a receivership appointment lastwith OCP about appointing a receiver?
night and OCP has until Monday to appoint receivers which OCP is
considering doing so. However, I don’t believe they will, and thereason is that any receiver will just have to get up to speed and that isgoing to add cost. Some of the assets available, primarily the potential
tax refunds, are things that the voluntary administrators or liquidators
can do. Appointing a receiver adds unnecessary cost and complexity
to the situation.

Question

49

our preliminary review is that any assets identified during ourinvestigation are not likely to be material to creditors.

Answer (All Answers Provided by Administrator Jason
Kardachi)We haven’t asked.

SB: Why did Jason Peacock resign?

We are not in the business of overcharging. Our fees will be reasonable
for the work that we do. We don’t need approval from creditors forfees under New Zealand law. This is unlike other regimes where it
would be customary for us to provide creditors with all information in
respect to our fees for approval. However, we have a very strong
reputation of doing cost-effective work.
No.
No.

SB: We’ll see.

SB: Have you canvassed any votes?

SB: No declaration as to voting intentions?

SB: Your fees on the IFA - three times what New Zealand practitioners We will continue to charge international rates given that there was nowould charge. Will you continue to charge international rates or New New Zealand insolvency practitioner willing to do the job. The
Zealand rates?
Company has tried to find one but failed.

I don’t have the number at this time and will need to revert.

SB: $5, $10, $15 million?

SB: Of the $66m for which you claim TTL is liable to OCP – how I don’t have that information at this time and will need to revert.
much of that was new money when security was granted?

SB: Was new money advanced from OCP to acquire TAG assets, but I believe there was some money that came into TTL.
not into TTL?

Question

50

Answer (All Answers Provided by Administrator Jason
Kardachi)

I am not aware, but we legally would not be able to disclose thisanyway in accordance with the confidentiality obligations in thepolicy.

SB: What are the limits of that insurance?

To keep the FPSO here, we offered to catch up on outstanding
operating cost for BWO if we can continue operations into next year
and agree new terms for the production period. Through that
production, the Company’s obligations to BWO will reduce and theCompany’s bank account will increase as well. Therefore, this isbeneficial to the creditors in this room.

SB: How much – what is the justification?

SB: $4 million a month to keep company operating? Would you cover That’s the full rack rates of operating. We are trying to maintainyour costs and operate for that period?
operations and to do deals closer to $1.5 million per month. We canonly commit and continue production if we are comfortable that

Yes, I have.

SB: Have you made any offers?

SB: Have you offered any creditors any preferential deals – payment We have worked hard to avoid it. Some of the key suppliers have triedahead of any other creditors?
to do a deal where they are paid pre-existing debt.

Yes.

SB: Do the directors of the company have any D&O insurance?

SB: You have personal liability for clean-up costs – could be NZ$110 The assets won’t cover the clean-up costs. We are of the view that wemillion. That’s what the Crown has told me. Do you have insurance are not liable for clean-up costs as it is a pre-existing obligation of thecover if the Company doesn’t cover you?
Company. We have taken advice from Kensington Swan. We haveprofessional indemnity insurance, but it would not cover this. The
third party report estimated clean-up costs to be USD58 million and
the Crown has submitted a claim for USD100 million.

Question

51

Not yet, we are still considering this. As soon as we issue non-use
notices, a liquidation will be shortly followed because there is nothing
to preserve.

obligations can be met. There are personal liabilities for contracts thatadministrators enter into.

Answer (All Answers Provided by Administrator Jason
Kardachi)

Question from Caroline Silk of Auld Brewer: Other Tamarind We act as administrators for TTL and its creditors, not the Tamarind
companies operating with TAG – how does parent think that those Group or OCP. You are right – there can be a contagion effectamongst creditors of the Tamarind Group. However, any fall out canoperations are going to go? They have pissed a lot of people off.
usually be fixed with money. Based on my limited understanding, theQuestion from Jack Wass, counsel for COSL: What is TTL’s parent The parent company is unable or unwilling to provide further funds.
They have a limited guarantee to BWO and unlimited guarantee to thecompany’s position in relation to this?
NZ Government in respect of the abandonment liability.

Question from Nick King of Halliburton New Zealand: Has that No. OCP is most likely entitled to that cash as a secured creditor.
money already been allocated?

Question from Nick King of Halliburton New Zealand: Are you Yes, we are trying our absolute best to negotiate with BWO. BWO has
still negotiating with BW Offshore?
notified us about their intention to leave and we are trying to keep themhere for as long as possible. We just received an email from the CEOof BWO asking a question about the proposal last night. This is the
4th or 5th iteration of the proposal. We will keep trying for a few moredays with BWO, maybe 3 to 15 days, but it is not going to be weeks.
At the very least, we want to do a lifting – that is the oil in the FPSO
now. We intend to produce to the end of year for a lifting to makesome money.

SB: Have you issued any non-use notices?

Question

52

TAG asset is a good asset which is making money and there is nocause for concern in relation to that.

Answer (All Answers Provided by Administrator Jason
Kardachi)

Question from Matthew Hareb of M Hareb Excavating: Did the That is why we are here.
company go into the drilling campaign with not enough money to pay
creditors?

Question from Michael Robinson, Barrister: Will the watershed If we can maintain production and operations, we will need longer to
put together a proposal for creditors. Any proposal for creditors reallymeeting be adjourned?
depends on the availability of further funding which we going to haveto resolve in next 10 business days or so. Alternatively, if we can’t
maintain operations, which is largely dependent on striking a deal with
BWO, then liquidation at the watershed meeting is a likely proposal
and the watershed meeting might be brought forward.

Question from Stu Barraclough of Todd Energy: Has there been Not to my knowledge. We have been actively communicating withtalks re making good between Crown and parent company?
Crown about the situation. We are not aware of any discussions thatthey have had with the guarantor (Tamarind Group).

Question from Stu Barraclough of Todd Energy: Limited The guarantee to BWO is limited but the guarantee to the Crown is notguarantee to the Crown?
limited.

Question13/11/2019

Taranaki oil company appoints administrators | NBR

Business (/category/business)

Taranaki oil company appoints administrators
Creditors said to be owed tens of millions()
By Tim Hunter (/author/tim-hunter)
Wed, 13 Nov 2019

Tamarind Resources terminated its contract for the floating production storage and offloading vessel Umuroa lastmonth

Administrators have been appointed to oil producer and explorer Tamarind Taranaki after
directors resolved the company was insolvent or likely to become so.

Tamarind Taranaki, a subsidiary of Singapore-registered Tamarind Resources, owns 37.5% of theTui oil field off Taranaki - but a drilling programme to find more oil came up dry in August.

https://www.nbr.co.nz/story/taranaki-oil-company-appoints-administrators

53

1/4

13/11/2019

Taranaki oil company appoints administrators | NBRManaging director Ian Angell told NBR last month the dry well and cost overruns had forced thecompany to halt its drilling programme.
“Tamarind Taranaki is currently trying to chart a path forward that would see us being able to offer
all of the suppliers a chance to get paid,” he said.
It is understood the company’s creditors are owed tens of millions of dollars, with COSL, the ownerof the Prospector drilling rig contracted for the Tui programme, said to be owed $US13 million.
Tamarind Taranaki’s secured lender is OCP Asia, based in Hong Kong and Singapore.
One market source said the company's secured and unsecured creditors were likely to be owed atleast $US50m.
“It has come down to the numbers but the appetite among creditors to support an administration,
which has nothing unless someone comes along to buy the Tui field, will be limited.”
Tamarind Resources, which owns the rest of the Tui field through other subsidiaries, terminated its
contract for the floating production storage and offloading vessel Umuroa last month.
Umuroa’s owner BW Offshore said there were “uncertainties related to payment of outstanding
overdue hire and payment of future hire until the termination date of December 31.”
The company said its earnings exposure could be $US23m and booked an immediate provision of$US10m.
The administrators for Tamarind Taranaki are Jason Kardachi and Mitchell Mansfield of Borelli
Walsh.
Kardachi is the firm’s Singapore-based managing director. Mansfield is based in the Cayman
Islands, according to the Borelli Walsh website.
Borelli Walsh has been advising Tamarind for at least a month.
Under the Companies Act the administrators must call a meeting of creditors within eight working
days of their appointment and convene a watershed meeting to decide the future of the company
within 20 working days.
Options at that point include liquidation or a deed of company arrangement with creditors.
Tamarind Taranaki’s most recent public financial statements for the year to June 2018 showedrevenue of $US19.7m and a net loss of $US4.8m.
Net assets at balance date were $US20.2m and its oil and gas assets were valued at $US31.1m.
Tamarind Resources bought the Tui field assets in a series of transactions with AWE, NZ Oil & Gas
and Pan Pacific Petroleum in 2016 and 2017.
AWE’s managing director David Biggs said at the time of the sale in December 2016 that Tamarind
had experience in managing late-life assets and decommissioning oil projects.
“With Tamarind’s expertise, and further improvement in the oil price, Tui could potentiallycontinue operating beyond 2019 which would benefit all stakeholders,” he said.
By Tim Hunter (/author/tim-hunter)
https://www.nbr.co.nz/story/taranaki-oil-company-appoints-administrators

54

Follow @TimHunter5

2/4

BUSINESSOil and gas operator
Tamarind Taranaki owes
creditors around $190 million
20 Nov, 2019 6:23pm
4 minutes to read

The Umuroa, which produces and stores oil from the Tui oil fields. Tui's owners, Tamarind
Taranaki, hit financial trouble this year when a drilling campaign was unsuccessful. Photo /Supplied

By: Hamish Rutherford
Wellington Business Editor
hamish.rutherford@nzme.co.nz @oneforthedr

Tamarind Taranaki, the troubled Malaysian-owned oil and gas operator which wasplaced in administration last week owes creditors around $190 million.

55

The owner of the Tui oil fields 50km offshore of New Plymouth, Tamarind
abandoned a drilling campaign in September after the first of three planned wells
was unsuccessful.
Tui, for a time the biggest producing oil field in New Zealand, is close to the end ofits life, with its former owners effectively paying Tamarind to take it off theirhands because decommissioning the field would cost tens of millions of dollars.
READ MORE:• Tamarind oil company's entry to NZ exposed 'giant loophole': Energy Minister• Taranaki oil and gas producer TAG Oil quits NZ operations• Taranaki oil producer Tamarind 'may be insolvent', directors warn
• NZ Oil & Gas urges shareholders to accept takeover proposal
Directors of Tamarind Taranaki warned on November 11 that it "may beinsolvent" as they agreed to put the company into voluntary administration,
meaning creditors will have to wait to be paid.
On Wednesday Tamarind's Singaporean-based administrators Borelli Walsh met
with creditors in New Plymouth.
A person with knowledge of the meeting told the Herald that attendees were toldthat some 78 creditors were collectively owed $190m.
Borelli Walsh managing director Jason Kardachi said the figure was "about right".
Kardachi said he provided the meeting with "an overview of the situation andwhat we're trying to do".
The immediate focus was to get the support of key suppliers to continue
production in the short term.
If that was successful, Kardachi would then attempt to gain finance to continue thedrilling campaign in the hope of extending the life of the Tui fields for several
more years.
Kardachi said he was still attempting to secure the support of several key suppliers
to continue production to avoid having to place Tamarind into liquidation.
"We've reached an agreement with most of them but not all, which I'm working
on and I hope to [secure] in coming days, for continued operation for a yet-to-beagreed period of time."
Creditors mostly asked about the make-up of the creditors lists and how thatwould affect them if trading continued.

56

A creditors report would be prepared for a watershed meeting which is meant tobe held within a month of the start of the administration, but which was likely to
be postponed as administrators would not be in a position to propose a deed ofcompany arrangement by then.
"All we're focused on at the moment is keeping things going as long as we can.
That's not a proposal," Kardachi said.
If administrators can secure the support of creditors, production of Tui would
continue into the early months of 2020. Beyond that, finance would be needed to
conduct a drilling campaign to extend Tui's production life.
Much of the company's debts are believed to be owed to the Crown in the form of
the liability to decommission the wells.
Kardachi said it was "very unlikely" that the Crown would withdraw support in
the short term.
"We're in active dialogue with the Crown in relation to that and it's in theirinterests for us to continue what we're doing," Kardachi said.
"We're working with them and have their support at the moment."
A spokesman for New Zealand Petroleum and Minerals confirmed that officials
were at the creditors meeting in New Plymouth on Wednesday but declined tocomment on the discussions.
Last week Energy and Resources Minister Megan Woods said she would beconcerned if the Government had to pay more than was agreed towards the cleanup of the Tui fields, with the former owners of the field providing Tamarind witharound $30m towards the clean-up.
Woods said Tamarind had entered New Zealand through a loophole in the Crown
Minerals Act because it had bought the company which was the operator of Tui,
meaning officials did not have scope to test its financial and technical capability.
As a result the Government quickly amended the act to prevent the situation fromhappening again.
Tamarind later purchased onshore Taranaki oil fields from Canadian oil company
TAG .

57

BUSINESSOil vessel prepares to leave Taranaki overhefty unpaid bill owed by Tamarind Resources
27 Nov, 2019 9:26am

The Umuroa has been producing oil from the Tui oil fields, offshore of Taranaki, since 2007 however its owners
say they are preparing to leave because of unpaid bills. Photo / supplied.

By: Hamish Rutherford
Wellington Business Editor
hamish.rutherford@nzme.co.nz
The owners of a vessel which has collected oil from a Taranaki oil field for more than a decade arepreparing to leave as the company pursues a hefty unpaid bill.
BW Offshore said it "has started preparations for disconnection and demobilisation" of the Umuroa, afloating production storage and offloading (FPSO) facility which has gathered oil from the Tui oilfields
since 2007.
The Tui fields are owned and operated by Tamarind Resources, a Malaysian oil and gas company
which warned this month that one of its New Zealand subsidiaries, Tamarind Taranaki, may beinsolvent .
A creditors meeting in New Plymouth last week heard the company had debts of close to $200 million
although the administrators have not named a figure.
With a clean up of the ageing fields looming, the troubles of Tamarind Taranaki have raised theprospect that the clean up costs when the field is decommissioned could fall on the Government.
Although Tamarind Taranaki's parent company has a guarantee to the Crown to cover thedecommissioning costs, it is unknown whether the company can cover the payment.

58

Industry sources have said the cost of abandoning and cleaning up the wells could cost in excess of$100 million, although part of the cost (42 per cent) would effectively fall on the Crown in any case.

In a statement to the Oslo Stock Exchange, BW Offshore said it had made a provision to write off
US$10 million ($15.6m) for the three months to September 30, but warned the total exposure to its
earnings before interest, tax, depreciation and amortisation could be US$23m ($35.8m).
"The assessment identified uncertainties related to payment of outstanding overdue hire and paymentof future hire until the termination."
Jason Kardachi from administrator Borrelli Walsh has declined to comment on BW Offshore's plans,
describing negotiations as "ongoing".
Since he was appointed Kardachi has been attempting to secure the support of Tamarind's key
suppliers to try to secure continued production in the short term.
On Tuesday Kardachi said that discussions were "continuing on a relatively positive note and I hopeto have agreement by the end of this week".
If support cannot be secured he has warned Tamarind Taranaki would have to be placed inliquidation.
The Ministry of Business, Innovation and Employment, which administers the manages theGovernment's petroleum and minerals interests, has refused to comment on its exposure to Tamarindor its position on whether it continues its continued operations.
Kardachi said on November 20 that it was "very unlikely" that the Crown would withdraw support in
the short term .
"We're in active dialogue with the Crown in relation to that and it's in their interests for us to continue
what we're doing," he said.
"We're working with them and have their support at the moment."5929/11/2019

Tamarind Taranaki told to stop pumping oil from offshore field until conditions met | Stuff.co.nz

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Tamarind Taranaki told to stop pumping oil from
offshore field until conditions met
Mike Watson · 09:38, Nov 28 2019

SUPPLIEDOil company Tamarind Taranaki have been stopped from pumping hydrocarbons from wells in the Tui
field to the Umuroa FPSO (picutured) after an oil leak in one of the flow lines was found recently.

Struggling oil company Tamarind Taranaki has been issued an abatement notice tostop pumping crude oil from three wells in the Tui field off the region's coast afteran oil spill last week.

60

https://www.stuff.co.nz/business/117770715/tamarind-taranaki-told-to-stop-pumping-oil-from-offshore-field-until-conditions-met

1/9

29/11/2019

Tamarind Taranaki told to stop pumping oil from offshore field until conditions met | Stuff.co.nz

Environment Protection Authority (EPA) issued the abatement notice this week to
Log inbusinessthe Malaysian-based company, which is currently under voluntary administration
owing more than $190m to creditors.
The notice stopped Tamarind Taranaki extracting oil from the Pateke 3H, Pateke
4H and Amokura wells to the Umuroa floating production storage andofftake vessel, or FPSO, in the Tui field until certain conditions were met, the EPA
said.
Tamarind will be able to resume production when the company complied with theabatement notice conditions, the authority said.
READ MORE:* Crown may foot $155m bill to decommission Taranaki oil field* Taranaki-based oil and gas firm owes creditors $190m* Taranaki offshore oil exploration company placed under voluntaryadministration* Jobs at stake after Tamarind Resources end contract at offshore production
facility
Under the conditions the company must "conclusively identify the source of thehydrocarbon sheen and provide evidence to the EPA supporting the conclusion
reached, assess the condition of the flowlines and associated connections of Pateke
3H, Pateke 4H and Amokura wells, and provide evidence to the EPA that confirms
system integrity will be maintained on start-up."
ADVERTISEMENT

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The authority is continuing to investigate the spill which was detected after a 2030m long sheen about 400m from the Umuroa was discovered about 60km off
shore on November 21.
The sheen, estimated by Tamarind to be about 100 litres, dispersed naturally.
61

https://www.stuff.co.nz/business/117770715/tamarind-taranaki-told-to-stop-pumping-oil-from-offshore-field-until-conditions-met

2/9

29/11/2019

Tamarind Taranaki told to stop pumping oil from offshore field until conditions met | Stuff.co.nz

A subsequent survey undertaken by thetheinb u scompany
i n e s s found a 10-12 metre split in Log
flow line connecting the Umuroa to the Tui 2H well.
Tamarind Taranaki can appeal the abatement notice and is working with the EPA toachieve compliance.
BW Offshore, which operates the Umuroa, is due to leave the Tui field in December
31 after Tamarind Taranaki decided not to renew its contract in September.
The Norwegian-based company estimates it is owed $35.8m (US$23m) byTamarind in unpaid costs.
Tamarind pulled out of a $300m drilling programme at the Tui field in September
after the first of three planned wells proved dry.
It has been estimated it could now cost the Government $155m to decommission
the oil field if Tamarind can not find a way out of it's financial struggles andcontinue operating.
Stuffmore from stuff

Jacinda Ardern comments come back to bite
Australian shock jock Alan Jones

Landlord says cards stacked against her in
Tenancy Tribunal

62

https://www.stuff.co.nz/business/117770715/tamarind-taranaki-told-to-stop-pumping-oil-from-offshore-field-until-conditions-met

3/9

Stephanie Illingworth
From:
Sent:
To:
Cc:
Subject:

Scott Barker <Scott.Barker@buddlefindlay.com>
Tuesday, 3 December 2019 1:40 p.m.
Éanna Brennan; Mei Hui Wang; Tamarind; James McMillan
michael.robinson@shortlandchambers.co.nz; Jack Wass
application for extension of convening period [BUD-LIVE.FID882522]

Dear all,I understand from media reporting of comments by Jason that an application for extension of the convening period iscontemplated by the VAs.
If such is to be sought, kindly ensure that it is sought on notice as I anticipate that it would be opposed.
Regards
Scott............................................................................................................................................
SCOTT BARKER | PARTNER | BUDDLE FINDLAY
Aon Centre, 1 Willis Street, PO Box 2694, Wellington 6140
P +64 4 499 4242 | DDI +64 4 498 7349 | M +64 21 822 929
scott.barker@buddlefindlay.com | www.buddlefindlay.com
BAND 1 - CHAMBERS AND PARTNERS | TIER 1 - LEGAL 500
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163

In the High Court of New Zealand
Auckland Registry
I Te K6ti Matua 0 Aotearoa
Tamaki Makaurau RoheCIV-2019-404—

UnderPart 19 of the High Court Rules and sections 239AT and
239AD0 of the Companies Act 1993

In the matter ofan application pursuant to section 239AT of the Companies Act
1993 for an order extending the convening period by which theadministrators must convene the watershed meeting for
Tamarind Taranaki Limited (Administrators Appointed)

and in the matter ofTamarind Taranaki Limited (Administrators Appointed)

In the matter of an
application by

M W Mansfield and J A Kardachi
Applicants

Affidavit of Patrick James Nicoll Glennie in support of originating
application without notice for order extending the convening period
by which the administrators must convene the watershed meeting for
Tamarind Taranaki Limited (Administrators Appointed)
Affirmed: 4 December 2019

KensingtonSwan0
18 Viaduct Harbour Avenue
Private Bag 92101
Auckland 1142
Solicitor:

8062005.1

P +6493794196
F +64 9 309 4276
DX CP22001

J A McMillan / M L Broadjames.mcmillan@kensingtonswan.com/mark.broad@kensingtonswan.com

Affidavit of Patrick James Nicoll Glennie in support of originating
application without notice for order extending the convening period
by which the administrators must convene the watershed meeting of
Tamarind Taranaki Limited (Administrators Appointed)
I, Patrick James Nicoll Glennie, of Kensington Swan, solicitor (admitted in Scotland)
acting on behalf of Mark Mansfield and Jason Kardachi, affirm:
1

I am an associate at Kensington Swan and have been advising the applicants inthis proceeding.

2

I am familiar with the matters at issue in this proceeding.

3This affidavit is affirmed further to the affidavit of Jason Kardachi dated
3 December 2019. This affidavit is necessary due to further developments since
the preparation of Mr Kardachi's affidavit.

4

Since the preparation of Mr Kardachi's affidavit, there has been a further delay inthe carrying out of the third party remote operated vehicle inspection of the pipes
at the Tui oil field. The completion of this inspection and approval of theinspection report by the Environmental Protection Authority are necessary before
production can recommence at the oil field.

5

At paragraph 17 of Mr Kardachi's affidavit, he stated that the inspection was to be
carried out this week and the report was expected at the end of the week. Due tofurther inclement weather at the Tui oil field, the inspection is now not due to takeplace until 11 December 2019. The administrators of Tamarind therefore do not
expect the inspection report to be ready until the end of next week (at theearliest).

8062005.1

6

The delay in the date of the inspection means that the Environmental Protection
Authority is now not likely to approve the restarting of production until, at least,
16 December 2019. This date is one week later than the expected date as set
out at paragraphs 14, 17 and 20 of Mr Kardachi's affidavit and may be subject tofurther delay.

C,LL
Patrick Glennie
AFFIRMED at Auckland
on 4 December 2019
before me:

A Solicitor of the High Court of New Zealand

LAPWORTH LLB
oticitor
Auck!and28062005.1

In the High Court of New Zealand
Auckland Registry
I Te Kati Matua 0 Aotearoa
Tamaki Makaurau RoheCIV-2019-404—

UnderPart 19 of the High Court Rules and sections 239AT and
239AD0 of the Companies Act 1993

In the matter ofan application pursuant to s239AT of the Companies Act 1993
for orders extending the convening period by which theadministrators must convene the watershed meeting for
Tamarind Taranaki Limited (Administrators Appointed)

and in the matter ofTamarind Taranaki Limited (Administrators Appointed)

In the matter of an

M W Mansfield and J A Kardachi

application by
Applicants

Memorandum of counsel in support of application for order
extending convening period
Dated: 4 December 2019

KenshxjtonSwan0
18 Viaduct Harbour Avenue
Private Bag 92101
Auckland 1142

P +6493794196
F +64 9 309 4276
DX CP22001

Solicitor: J A McMillan/M L Broad
E james.mcmillan@kensingtonswan.com/mark.broad@kensingtonswan.com
8052566.1

May it please the Court:
Introduction
1

This is an urgent application for an order extending the convening period bywhich the administrators must convene the watershed meeting for Tamarind
Taranaki Limited (Administrators Appointed) ('Tamarind').

2

The grounds for this order are set out in the notice of originating application andthe affidavit of Mr Kardachi in support of this application.

3

The administrators, Mitchell Mansfield and Jason Kardachi of Borrelli Walsh, arerequired to convene the watershed meeting by Monday, 9 December 2019.1
They seek an order extending the time for convening the watershed meeting to
17 February 2020, to allow them to provide a meaningful report to Tamarind's
creditors.

4

The administrators have been engaged in discussions with key creditors andsuppliers of Tamarind aimed at ensuring that Tamarind can continue to produce
oil until, at least, the end of the current production cycle. The administrators
anticipate that an agreement will shortly be reached as to the terms on which
production can continue.2 If production can continue, it will improve the returns
for Tamarind's creditors. It will also allow the administrators to approach potential
purchasers of Tamarind's assets to ascertain interest.

5

Currently, the administrators are waiting for approval from the Environmental
Protection Authority (the 'EPA') before Tamarind can recommence oil
production.3 Approval is expected on 16 December 2019, at the earliest, andmay be delayed.4

6

Whether, and when, approval is provided by the EPA is critical to whether
continuing production is viable or whether liquidators should be appointed toTamarind. The timing and terms of the EPA's decision will have a material effecton the report and advice that the administrators require to circulate to creditors at
the end of the convening period.

7

If the administrators are required to report and advise without knowing whether
and, if so, on what terms, approval has been granted, their report and advice will
not be as meaningful to creditors as it could be. Extending the time for the

1 Section 239AT of the Companies Act 1993.

Kardachi affidavit, [14].
Kardachi affidavit, [16].
4 Kardachi affidavit, [17] and Glennie affidavit, [6].

2318052566.1

convening period is likely to result in Tamarind's creditors being able to make amore informed decision as to its future. It will also increase the chances that theadministrators can put forward a proposal for the sale of Tamarind's assets or forcontinued operation at the oil field as a result of additional third party funding.
The relevant law
8

Section 239AS of the Companies Act 1993 (Act) states that:
239AS What watershed meeting is
The watershed meeting is the meeting of creditors called by the administrator todecide the future of the company and, in particular, whether the company and thedeed administrator should execute a deed of company arrangement.

9Section 239AT of the Act states that:
239AT Administrator must convene watershed meeting(1)

The administrator must convene the watershed meeting within the convening
period.

(2)

The convening period is the period of 20 working days after the date on which
the administrator is appointed, and includes any period for which it is extended
under subsection (3).

(3)

The Court may, on the administrator's application, extend the convening period.

(4)

The application to extend may be made before or after the convening period has
expired.

10

Section 239AV of the Act states that:
239AV When watershed meeting must be held
The watershed meeting must be held within 5 working days after the end of theconvening period or extended convening period, as the case may be.

11

Section 239AD0 of the Act relevantly states:
239AD0 Court's general power(1)

The Court may make any order that it thinks appropriate about how this Part is tooperate in relation to a particular company.

28052566.1

(3)The Court's orders may be made subject to conditions.

(4)

The Court may make an order under this section on the application of —[•••1(c) the administrator;
12

Subsection 239AT(3) does not list the factors that should be taken into accountwhen deciding upon an application to extend the convening period, but the Court
has considered the appropriate test on a number of occasions.5 The Court has
observed that it has "an unfettered discretion to extend the convening period".6
The key principles to emerge from these cases are helpfully set out in
Re Grenfe11:7(a)the power to extend the convening period should be exercised in light of the objectsof the voluntary administration regime at s239A — in particular, the objects are to
maximise the chances of the company continuing in existence, or, if that is notpossible, to achieve a better return for the company's creditors and shareholders
than would result from an immediate liquidation of the company;(b)

the nature and extent of the work required to fulfil the administrators' obligations will
depend on the nature and complexity of the company that is the subject of theadministration;(c)the Court must strike an appropriate balance between the interests of the creditorsthat the administration proceeds in a relatively speedy and summary manner and therequirement that undue speed does not prejudice sensible and constructive actions
directed towards maximising the return for creditors and shareholders; and(d)whether an extension should be granted is fact specific but the following factors arelikely to be relevant:(i) the size and scope of the business;(ii) whether the company partakes in substantial offshore activities;(iii) whether there are a large number of employees with complex entitlements;(iv) whether there is a complex corporate structure and inter-company loans;(iv) any complex transactions entered into by the company;

5 Including, Re Nylex (New Zealand) Ltd HC Auckland CIV-2009-404-1217, Re M Webster Holdings (NZ) Ltd [2017] NZHC 297, Re
Pumpkin Patch Ltd [2016] NZHC 2771, Re McElhinney [2019] NZHC 23 and Re Fiber Fresh Feeds Ltd (in rec and administration) [2019]

NZHC 1565.
6
7

Re Jackson [2018] NZHC 477 at [16].
Re Gren fell [2016] NZHC 36 at [6] to [15].

38052566.1

(v) whether the administrators lack access to corporate financial records;(vi) the time needed to execute an orderly process of disposal of assets;(vii) the time needed for a thorough assessment of a proposal for a deed ofcompany arrangement;(viii) whether the extension sought will allow the sale of the business as a going
concern; and(ix) more generally, whether additional time is likely to enhance the return for
unsecured creditors.

13

In Re Jackson, the Court observed that:...the circumstances of an administration will not infrequently encounter issues
that are not capable of prompt resolution and which require further time tostabilise and rationalise the business, continue trading in appropriate cases,
realised assets, and conduct a range of negotiations in order to achieve either thecontinued existence of the business or a better outcome for its creditors andshareholders. Where sound commercial and practical reasons are shown tosupport a realistic prospect of a better outcome being derived following an
extension of time, it will be appropriate for the Court to exercise the discretion to
grant an extension.

14

The Court has considered what length of extension is appropriate where an
extension is granted. The extensions granted have varied according to thecircumstances of each case, but range from as short as 20 working days (byrequest) to as long as 18 months.8

15

The purpose of s239ADO is to provide the Court with the power to make ordersthat alter the way in which Part 15A operates, so as to ensure that the objectivesof the voluntary administration regime can be achieved in the case of a particularcorn pany.9

16

Rule 19.2(c) of the High Court Rules 2016 states that applications to the Court
under Part 15A of the Act must be made by way of originating application.

17

In Re Jackson, the Court approved an originating application made without noticeon the basis that the administrators had provided sufficient evidence that it was
unlikely that the creditors and employees of the company would be adversely

at [15] and also see Re Fiber Fresh Feeds Ltd (in rec and administration) at [27], Re Postie Plus Group [2014] NZHC 1337
at [22] and [30] and Re Drikolor New Zealand Limited Unreported 14/11/09, Edwards J HC Auckland CIV-2019-404-002183.
9 Insolvency Law & Practice (online loose-leaf ed, Thomson Reuters) at [CA239AD0.01].
8 Re Grenfell

48052566.1

affected by the extension.1° In that case, like the present application, thecreditors had been informed at the first meeting of creditors that an application foran extension was likely, but the same approach has been followed in a number ofcases where creditors had not been notified."
Background18

On 11 November 2019, Mitchell Mansfield and Jason Kardachi of Borrelli Walshwere appointed administrators of Tamarind.12 Tamarind operates the Tui oil field
off the Taranaki coast.13 As at the date on which administrators were appointed,
Tamarind had 117 creditors owed a total of US$231,647,512.57. Of this sum,
US$66,940,821.85 is owed to Orchard Capital Partners, which was granted ageneral security by Tamarind over all of its assets (subject to confirmation of thevalidity of the security). A further US$812,480.17 is owed to seven employees ofTamarind, of which US$152,200.20 is preferential debt.14

19

The administrators have taken the usual steps to investigate Tamarind's affairs
and explore whether it is possible for the company to continue to trade or for
there to be a sale of the company's assets or business.15

20

The administrators consider that, if favourable terms can be agreed, continuing
production at the Tui oil field until, at least, the end of the current production cyclein January 2020 will lead to an increased return for creditors.16 Continuing
production until the end of the current cycle will also make it more likely that asale of Tamarind's assets or business can be agreed or that the company cansecure third party funding allowing it to continue to operate profitably for a longer
period 17

21

The administrators have held a number of discussions with BW Offshore
Singapore Pte Ltd ('BWO'), the owner of the floating production storage andoffloading vessel stationed at the Tui oil field, to agree an amendment to theexisting contract under which the vessel will continue to operate at the oil field.18
The administrators expect that terms will shortly be agreed for the vessel tocontinue to operate until January 2020.19

1° Re Jackson [2018] NZHC 477 at [12] and also see Renaissance Brewing Ltd v Shepherd [2017] NZHC 2744 at [21] .
11 Including Re Kumfs Group Ltd [2019] NZHC 2552 at [7].
Kardachi affidavit, [3] and exhibit 'JAK-1' at pages 1 and 2.
Kardachi affidavit, [3].
14 Kardachi affidavit, [4].
15
Kardachi affidavit, [7].
16 Kardachi affidavit, [11].
17 Kardachi affidavit, [12].
18 Kardachi affidavit, [13].
19 Kardachi affidavit, [14].
121358052566.1

22

While these discussions were ongoing, a relatively minor leak of oil led to thediscovery of a cut in one of the pipes between the seabed and the storage andoffloading vessel. As a result of the discovery, production was been put on
hold.25

23

The administrators put production on hold and instructed a full inspection of theremaining pipes. The administrators also liaised with the EPA and otherregulatory authorities. The EPA issued an abatement notice confirming that it
requires to review the inspection report before production can recommence.21

24

The administrators initially hoped that this process could be completed in time for
production to restart by 1 December 2019. The weather conditions, though, havedelayed the carrying out of the inspection.22

25

Following the initial delay, the independent survey was expected to be carried out
this week with the report expected at the end of the week. On that basis, theearliest that the administrators expected the EPA to complete its review of thereport and grant approval for production to restart was 9 December 2019.23
Further inclement weather conditions have led to an additional delay in carryingout the inspection. The inspection is now due to take place on 11 December 2019
and the report is expected at the end of next week (at the earliest).24 The EPA is
therefore not expected to complete its review and grant approval for production torestart until 16 December 2019 (at the earliest).25

26

Meanwhile, the administrators are required to convene a watershed meeting of
Tamarind's creditors within the convening period, which currently ends on
Monday, 9 December 2019. On the same date, the administrators must circulate
a report about Tamarind's business, property, affairs and financial circumstances
to creditors. The administrators must also provide a statement to creditors settingout, among other things, whether it would be in the creditors' interests for
Tamarind to execute a deed of company arrangement or be placed in liquidation.

27

The watershed meeting must be held within five working days after the end of
the convening period (that is, by Monday, 16 December 2019). At the watershedmeeting, Tamarind's creditors will decide on the future of the company.26

20 Kardachi affidavit, [15].
21 Kardachi affidavit, [16].
22 Kardachi affidavit, [17].
23 Kardachi affidavit, [17].
24

Glennie affidavit, [5].

25 Glennie affidavit, [6].
26 Kardachi affidavit, [9].

68052566.1

The reason for this application — more time needed to confirm whether, and when,
production will restart and to identify potential purchasers or sources of funding.
28

The administrators consider that, to maximise the return for Tamarind's creditors,
a short extension to the convening period is required to 17 February 2020.27

29

The administrators consider that, provided favourable terms can be agreed, thebest way to enhance the recovery for Tamarind's creditors is to continue
production at the Tui oil field.28 Continuing production on profitable terms will also
allow the administrators time to try to arrange a sale of Tamarind's assets or
obtain further funding.

30

The administrators expect shortly to agree terms with BWO under which
continued production will be profitable for Tamarind and will lead to an increase in
the funds available to creditors.29

31

The viability of continued production, though, depends on Tamarind being able torestart production shortly. Until the administrators know when production canrecommence and have had an opportunity to approach potential purchasers ofTamarind's assets or funders, it will be difficult for them to provide a meaningful
report to creditors.

32

The administrators expect to have further information as to when production will
recommence on, or shortly after, 16 December 2019. Once they have thisinformation, the administrators will be able more usefully to ascertain interest inpurchasing Tamarind's assets as well as the availability of third party funding andthen update and advise Tamarind's creditors in respect of the position of thecompany and the options available to it.

33

If the convening period is not extended, the administrators will have to reportbased on incomplete information and may be required to take a conservative
approach in respect of the prospects of continued production. As such, there
would be a higher probability of liquidators being appointed to Tamarind at theend of the current convening period and following the watershed meeting.3° At
this stage, the administrators consider that liquidation would not be in the bestinterests of creditors of Tamarind, including its present and former employees.31

27 Kardachi affidavit, [10].
28 Kardachi affidavit, [11].
29 Kardachi affidavit, [14].
38 Kardachi affidavit, [23].
31 Kardachi affidavit, [23].

78052566.1

34

There is a need for a short extension to allow the administrators to receive andconsider information that is pertinent to their report to creditors and their advice
as to the best way to achieve an improved outcome for creditors. There aresound commercial and practical reasons to support the prospect of a better
outcome being achieved following an extension of time as more informed
decisions will be able to be made.

35

If the orders sought are granted, the administrators will endeavour to hold thewatershed meeting as soon as possible within the extended convening period.32

Proposed extension of convening period will not prejudice creditors
36

The brief extension to the convening period sought by the administrators will notprejudice creditors because:athe administrators estimate that, if the extension is granted and it allows
production to restart, it will increase the chances of production continuing,
and, in turn, increase the prospect of sale of Tamarind's assets and/or
ongoing funding and the amount of money available for distribution tocreditors;33bcreditors who are suppliers of goods and/or services to Tamarind areprotected by the administrators' statutory obligation to pay for relevant
amounts and Tamarind's landlord will continue to be paid for occupation for
Tamarind's occupation of its premises:34
all creditors will receive notice of this application and orders (if granted) byemail or post (which is consistent with service of the orders that werepreviously granted in respect of our application under section 280 of theCompanies Act) and will have the ability to apply to vary or set aside theorders.36

Appropriate that this application is made and determined on a without notice basis
37

In Re Jackson, a similar proceeding to the present application, Davison J was
prepared to consider and determine the matter on a without notice basis
because:36

32 Kardachi affidavit, [25].
33 Kardachi affidavit, [26a].
34 Kardachi affidavit, [26b] and section s239ADH of the Companies Act 1993.
35 Kardachi affidavit, [26d].
36 Re Jackson [2018] NZHC 477 at [12].

88052566.1

...provision of notice.. .to creditors and employees would involve delay andexpense in circumstances where unnecessary expenditure is to be avoided, andthat it is unlikely that any of the employees or creditors will be adversely affectedby an extension of time for the convening period. In fact, to the contrary, an
extension of the convening period is most likely to improve or enhance theinterests of the creditors and employees.
38

It is also appropriate for this application to be made and determined on a without
notice basis, because:37aextending the convening period for a brief period should not prejudiceTamarind's creditors;bpersonal service of the application on Tamarind's known 117 creditors andseven employees would be time-consuming and expensive, given theurgency of the application;
if the orders sought are granted:i

within five working days a copy of this application and the Court'sorders will be given to creditors of Tamarind by:A

email, where an email address has been provided to Tamarind; orBpost, to the postal address provided by creditors in instanceswhere an email address has not been provided; andC

posting notice on Borrelli Walsh's website (www.borrelliwalsh.com)
on the webpage in respect of the administration of Tamarind; andii

any person (including Tamarind's creditors) will be able to apply tomodify or discharge the orders, on appropriate notice to theadministrators.

39

On 3 December 2019, the administrators and their solicitors received an email
from the solicitor acting on behalf of DOF Management Australia Pty Ltd, one of
Tamarind's creditors.38 The email referred to reports that the administrators
would make an application for the extension of the convening period and asked
that it be made on a with notice basis as it was anticipated that the application
would be opposed.

37
38

Kardachi affidavit, [27].
Kardachi affidavit, [28].
98052566.1

40

The email does not change the reasoning set out at paragraph 38 above. In
particular, it is not practical to serve each of Tamarind's known 117 creditors
given the urgency of the application. However, as a matter of courtesy, theadministrators will provide a copy of the application once it is made to thefollowing parties:athe five creditors who are members of the creditors committee elected at thefirst meeting of Tamarind's creditors;b

DOF Management Australia Pty Ltd; andc

COSL Offshore Management AS, a further creditor of Tamarind which has
file a notice of opposition to the s280 application previously granted. 39

41

Providing a copy of the application to these creditors is not required but, in thecircumstances, is done as a matter of courtesy and to enable these creditors toengage with the application.

Procedure for service
42

If the Court makes the orders sought, then it is appropriate that the applicationand the Court's orders be served on Tamarind's creditors by:aemail, where an email address has been provided to Tamarind; orbpost, to the postal address provided by creditors in instances where an email
address has not been provided; andcposting notice on Borrelli Walsh's website (www.borrelliwalsh.com) on the
webpage in respect of the Tamarind administration.

43

A similar approach has been considered to be an "practical, effective andefficienr means of giving notice of the application and orders to creditors.4°

Costs
44

The administrators respectfully request that the actual costs and disbursementsof this application be met as an expense of the administration (paid from
Tamarind's funds in the same priority as the administrators' fees).

39 Kardachi affidavit, [29].
40

Re Jackson [2019] NZHC 477 at [25].

108052566.1

Counsel's details
45

Counsel for the administrators, James McMillan, is available to appear in supportof this application by telephone conference, or in person. Counsel can becontacted by telephone on: (09) 375 1154 or 0274 322 570.

Dated: 4 December 2019

Counse for applicants

118052566.1

In the High Court of New Zealand
Auckland Registry
I Te Kōti Matua O Aotearoa
Tāmaki Makaurau RoheCIV–2019–404–

UnderPart 19 of the High Court Rules and sections 239AT and
239ADO of the Companies Act 1993

In the matter ofan application pursuant to s239AT of the Companies Act 1993
for orders extending the convening period by which theadministrators must convene the watershed meeting for
Tamarind Taranaki Limited (Administrators Appointed)

and in the matter ofTamarind Taranaki Limited (Administrators Appointed)

In the matter of an
application by

M W Mansfield and J A Kardachi
ApplicantsApplicant’s bundle of authorities
Dated: 4 December 201918 Viaduct Harbour Avenue
Private Bag 92101
Auckland 1142

P +64 9 379 4196
F +64 9 309 4276
DX CP22001

Solicitor: J A McMillan/M L BroadE
james.mcmillan@kensingtonswan.com/mark.broad@kensingtonswan.com
8052571.1

LegislationTAB
DESCRIPTIONNO.

1Companies Act 1993, ss 239AS, 239AT, 239AV and 239ADO.

Cases

TAB
DESCRIPTIONNO.

2

Re Grenfell [2016] NZHC 36.

3

Re Jackson [2018] NZHC 477.

4

Re Postie Plus Group [2014] NZHC 1337.

Commentary

TAB
DESCRIPTION
NO.

5Insolvency Law & Practice (online loose-leaf ed, Thomson Reuters) at[CA239ADO.01].

28052571.1

Reprint
as at 24 October 2019

Companies Act 1993
Public Act
Date of assent
Commencement

1993 No 105
28 September 1993
see section 1(2)Contents
Page
1

Title

24

Short Title and commencement

24

Part 1Preliminary
2
3
4
5
6
7
8
8A
9

Interpretation
Public notice
Meaning of solvency test
Meaning of holding company and subsidiary
Extended meaning of subsidiary [Repealed]
Control defined
Certain matters to be disregarded
Transitional, savings, and related provisions
Act binds the Crown

24
32
33
34
35
35
35
36
36

Part 2
Incorporation
Essential requirements
10

Essential requirements

36

Note
Changes authorised by subpart 2 of Part 2 of the Legislation Act 2012 have been made in this official reprint.
Note 4 at the end of this reprint provides a list of the amendments incorporated.
This Act is administered by the Ministry of Business, Innovation, and Employment.
1Reprinted as at
24 October 2019

228
229
230
231
232
233
234

Companies Act 1993

Compromise proposal
Notice of proposed compromise
Effect of compromise
Variation of compromisePowers of court
Effect of compromise in liquidation of company
Costs of compromise

179
179
180
180
181
182
182

Part 15
Approval of arrangements, amalgamations, and compromises
by court
235
236
236A
236B
237
238
239

Interpretation
Approval of arrangements, amalgamations, and compromises
Arrangement or amalgamation involving code company
Takeovers code does not apply where court order under section
236
Court may make additional orders
Parts 13 and 14 not affected
Application of section 233

183
183
184
185
185
186
186

Part 15A
Voluntary administration
Subpart 1—Preliminary
239A
239B
239C
239D
239E
239EA

Objects of this Part
Interpretation of some key terms
Interpretation of other terms
When administration begins
When administration ends
Voluntary administration of licensed insurers

187
187
187
188
188
189

Subpart 2—Appointment of administrator
239F
239G
239H
239I
239J
239K
239L
239M
239N
239O

Who may be appointed administrator
Administrator must consent in writing
Who may appoint administrator
Appointment by company
Appointment by liquidator or interim liquidator
Appointment by secured creditor
Appointment by court
Appointment must not be revokedAppointment of 2 or more administrators
Remuneration of administrator

189
189
190
190
191
191
191
192
192
192

Subpart 3—Resignation and removal of administrator
239P
239Q
239R

When office of administrator is vacant
Administrator may resign
Removal of administrator

193
193
193
11

Companies Act 1993

239S
239T

Reprinted as at
24 October 2019

Appointor may appoint new administrator to fill vacancy
Creditors must consider appointment of replacementadministrator

194
194

Subpart 4—Effect of appointment of administrator
239U
239V
239W
239X
239Y
239Z
239AA
239AB
239AC
239AD

Outline of administrator’s role
Administrator’s powers
Administrator is company’s agent
Effect on directors
Effect on employees
Effect on dealing with company property
Company officer’s liability for compensation for void transaction
or dealing
Effect on transfer of shares
Effect on liquidation
Effect on receivership

195
195
195
195
196
196
197
197
198
198

Subpart 5—Administrator’s investigation of company’s affairs
239AE
239AF
239AG
239AH
239AI

Administrator must investigate company’s affairs and consider
possible courses of action
Directors’ statement of company’s position
Administrator’s right to documents, etc
Administrator may lodge report with Registrar
Administrator must report misconduct

198
199
199
199
199

Subpart 6—Creditors’ meetings generally
239AJ
239AK
239AL
239AM

Administrator must call creditors’ meetings
Conduct of creditors’ meetings
Joint meetings of creditors of related companies in administration
Power of court where outcome of voting at creditors’ meeting
determined by related entity

200
201
201
202

Subpart 7—First creditors’ meeting to appoint creditors’committee
239AN
239AO
239AP
239AQ
239AR

Administrator must call first creditors’ meeting
Notice of first and subsequent creditors’ meetings
Administrator must table interests statement
Functions of creditors’ committee
Membership of creditors’ committee

203
203
204
204
204

Subpart 8—Watershed meeting
239AS
239AT
239AU
239AV
239AW
239AX
12

What watershed meeting is
Administrator must convene watershed meeting
Notice of watershed meeting
When watershed meeting must be held
Directors must attend watershed meeting
Disclosure of voting arrangements

205
205
205
206
206
206

Reprinted as at
24 October 2019

239AY
239AZ
239ABA
239ABB

Companies Act 1993

Court may order that pooled property owners are separate class
Adjournment of watershed meeting
What creditors may decide at watershed meeting
What happens if proposed deed not fully approved at watershedmeeting

207
207
207
208

Subpart 9—Protection of company’s property duringadministration
239ABC239ABD239ABE
239ABF
239ABG
239ABH
239ABI
239ABJ

Charge unenforceable
Owner or lessor must not recover property used by company
Proceeding must not be begun or continued
Administrator not liable in damages for refusing consent
Enforcement process haltedDuties of court officer in relation to company’s property
Lis pendens taken to exist
Administration not to trigger enforcement of guarantee of liabilityof director or relative

208
208
209
209
209
209
210
210

Subpart 10—Rights of secured creditor, owner, or lessor
239ABK Meaning of terms used in this subpart
239ABL If secured creditor acts before or during decision period
239ABM If enforcement of charges begins before administration
239ABM Enforcement of security interest over collateral for qualifyingA
derivative
239ABN Charge over perishable property
239ABO Court may limit powers of secured creditor, etc, in relation toproperty subject to charge
239ABP Giving notice under security agreement
239ABQ If recovery of property begins before administration
239ABR Recovering perishable property
239ABS Court may limit powers of receiver, etc, in relation to property
used by company
239ABT Giving notice under agreement about property

211
211
213
213
214
214
215
215
216
216
216

Subpart 11—Interface with liquidation
239ABU When liquidator may be appointed to company in administration
239ABV Court may adjourn application for liquidation
239ABW Court must not appoint interim liquidator if administration increditors’ interests
239ABX Effect of appointment of liquidator
239ABY Former administrator is default liquidator
239ABZ Person in control of company must lodge revised report with
Registrar
239ACA Act of administrator in good faith must not be set aside inliquidation
239ACB Voidable transactions

217
217
217
217
217
218
218
218
13

Companies Act 1993

Reprinted as at
24 October 2019

Subpart 12—Deed administrator
239ACC
239ACD239ACE
239ACF
239ACG
239ACH
239ACI
239ACJ
239ACK
239ACLWho is deed administrator
Who may be appointed deed administrator
Deed administrator must consent in writing
Appointment of deed administrator must not be revokedAppointment of 2 or more deed administrators
When office of deed administrator vacant
Deed administrator may resign
Removal of deed administrator
Remuneration of deed administrator
Deed administrator may sell shares in company

219
219
219
219
220
220
220
220
221
221

Subpart 13—Execution and effect of deed of company
arrangement
239ACM When this subpart applies
239ACN Preparation and contents of deed
239ACO Execution of deed
239ACP Procedure if deed not fully approved at watershed meeting
239ACQ Creditor must not act inconsistently with deed, etc, before
execution
239ACR Company’s failure to execute deed
239ACS Who is bound by deed
239ACT Extent to which deed binds creditors
239ACU Person bound by deed must not take steps to liquidate, etc
239ACV Court may restrain creditors and others from enforcing charge orrecovering property
239ACW Effect of deed on company’s debts
239ACX Court may rule on validity of deed

221
221
222
223
223
223
224
224
224
225
225
226

Subpart 14—Administrator’s duty to file accounts
239ACY Administrator includes deed administrator
239ACZ Administrator must file accounts

227
227

Subpart 15—Variation and termination of deed
239ADA
239ADB
239ADC
239ADD239ADE
239ADF

Creditors may vary deed
Court may cancel creditors’ variation
Termination of deed
Termination by court
Termination by creditors
Creditors’ meeting to consider proposed variation or terminationof deed

227
228
228
228
229
229

Subpart 16—Administrator’s liability and indemnity for debts ofadministration
239ADG Administrator not liable for company’s debts except as provided
in this subpart and in section 239Y
14

230

Reprinted as at
24 October 2019

Companies Act 1993

239ADH Administrator liable for general debts
239ADI Administrator’s liability for rent
239ADJ Administrator not liable for rental if non-use notice in force
239ADK Court may exempt administrator from liability for rent
239ADL Administrator’s indemnity
239ADM Administrator’s right of indemnity has priority over other debts
239ADN Lien to secure indemnity

230
231
231
232
232
233
233

Subpart 17—Powers of court
239ADO
239ADP
239ADQ
239ADR
239ADS
239ADT

Court’s general power
Orders to protect creditors during administration
Court may rule on validity of administrator’s appointment
Administrator may seek directions
Court may supervise administrator or deed administrator
Court may order administrator or deed administrator to remedy
default
239ADU Court’s power when office of administrator or deed administrator
vacant, etc
239ADV Prohibition order

233
234
234
234
235
235
236
236

Subpart 18—Notices about steps taken under this Part
239ADW Administrator must give notice of appointment
239ADX Secured creditor who appoints administrator must give notice tocompany
239ADY Deed administrator must give notice of execution of deed ofcompany arrangement
239ADZ Deed administrator must give notice of failure to execute deed ofcompany arrangement
239AEA Deed administrator must give notice of termination by creditorsof deed of company arrangement
239AEB Company must disclose fact of administration
239AEC Notice of change of name239AED Effect of contravention of this subpart

237
238
238
238
238
239
239
239

Subpart 19—Miscellaneous
239AEE
239AEF

Effect of things done during administration of company
Interruption of time for doing act

240
240

Subpart 20—Set-off and netting agreements
239AEG
239AEH
239AEI239AEJ

Mutual credit and set-off
Application of set-off under netting agreement
Calculation of netted balance
Mutuality required for transactions under bilateral netting
agreements
239AEK When mutuality required for transactions under recognised
multilateral netting agreements

240
240
241
241
242

15

Companies Act 1993

Reprinted as at
24 October 2019239AEL

Application of set-off under section 239AEG to transactions
subject to netting agreements
239AEM Transactions under netting agreement and effect on certain
sections
239AEN Rights under netting agreement not affected by commencement ofadministration
239AEO Effect of declaration of person as recognised clearing house under
section 310K
239AEP Transactions under recognised multilateral netting agreement notaffected by variation or revocation of declaration under section
310K

242
242
243
243
243

Subpart 21—Single administration of related companies inadministration
239AEQ Interpretation of terms for purposes of this subpart
239AER Court may order single administration for related companies inadministration
239AES Notice that application filed must be given to administrators andcreditors
239AET Guidelines for single administration order
239AEU Court may order that related company in administration be added
to existing pool
239AEV Creditors’ meetings in single administration of pool companies
239AEW Pool companies may execute single deed of company
administration

244
244
245
245
246
246
246

Part 16
Liquidations
The process of liquidation
240
240A
240B
241
241AA
241A
242
243
244
245
245A
246
247
248
16

Interpretation
Liquidation of licensed insurers
Liquidation of associations
Commencement of liquidation
Restriction on appointment of liquidator by shareholders or board
after application filed for court appointment
Commencement of liquidation to be recorded
Liquidators to act jointly unless otherwise statedLiquidator to summon meeting of creditors
Liquidator to summon meeting of creditors in other cases
Liquidator may dispense with meetings of creditors
Power of court where outcome of voting at meeting of creditors
determined by related entity
Interim liquidator
Power to stay or restrain certain proceedings against company
Effect of commencement of liquidation

246
247
247
248
249
250
250
250
252
253
253
254
255
255

Reprinted as at
24 October 2019

Companies Act 1993

Part 15A s 239AU

Subpart 8—Watershed meeting
Subpart 8: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act 2006
(2006 No 56).

239AS What watershed meeting is
The watershed meeting is the meeting of creditors called by the administrator
to decide the future of the company and, in particular, whether the company
and the deed administrator should execute a deed of company arrangement.
Section 239AS: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act 2006
(2006 No 56).

239AT Administrator must convene watershed meeting(1)

The administrator must convene the watershed meeting within the convening
period.

(2)

The convening period is the period of 20 working days after the date on which
the administrator is appointed, and includes any period for which it is extended
under subsection (3).

(3)

The court may, on the administrator’s application, extend the convening period.

(4)

The application to extend may be made before or after the convening period
has expired.
Section 239AT: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act 2006
(2006 No 56).

239AU Notice of watershed meeting(1)

The administrator must convene the watershed meeting by—(a)giving written notice of the meeting to as many of the company’s creditors as reasonably practicable; and(b)advertising the meeting in accordance with section 3(1)(b).

(2)

The administrator must take the steps in subsection (1) not less than 5 working
days before the meeting.

(3)

The following documents must accompany the notice of the watershed meetingthat is sent to the company’s creditors:
(a)

(b)

a report by the administrator about—(i)the company’s business, property, affairs, and financial circumstances; and(ii)

any other matter material to the creditors’ decisions to be considered at the meeting; anda statement setting out the administrator’s opinion, with reasons for that
opinion, about each of the following matters:(i)whether it would be in the creditors’ interests for the company to
execute a deed of company arrangement:
205

Part 15A s 239AV(c)

Companies Act 1993

Reprinted as at
24 October 2019(ii)

whether it would be in the creditors’ interests for the administration to end:(iii)

whether it would be in the creditors’ interests for the company tobe placed in liquidation; andif a deed of company arrangement is proposed, a statement setting out
the details of the proposed deed.

Compare: Corporations Act 2001 s 439A(3), (4) (Aust)
Section 239AU: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act 2006
(2006 No 56).

239AV When watershed meeting must be held
The watershed meeting must be held within 5 working days after the end of theconvening period or extended convening period, as the case may be.
Compare: Corporations Act 2001 s 439A(2) (Aust)
Section 239AV: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act 2006
(2006 No 56).

239AW Directors must attend watershed meeting(1)

The directors of the company must attend the watershed meeting, including any
occasion to which the meeting is adjourned, but cannot be required to answer
questions at the meeting.

(2)

A director need not attend the watershed meeting if—(a)the director has a valid reason for not attending; or(b)

the administrator or the creditors by resolution have excused the director
from attending.

(3)

A director attending the watershed meeting must leave for all or part of theremainder of the meeting if required by a resolution of the creditors to do so.

(4)

A director who contravenes subsection (1) commits an offence, unless subsection (2) applies, and is liable on conviction to the penalty set out in section
373(1).
Section 239AW: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act
2006 (2006 No 56).

239AX Disclosure of voting arrangements
The administrator and the directors of the company under administration must,
before the meeting votes on any resolution, inform the meeting of any voting
arrangement of which the administrator or a director, as the case may be, isaware that requires 1 or more creditors to vote in a particular way on any resolution that will or may be voted on by the meeting.
Section 239AX: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act 2006
(2006 No 56).

206

Reprinted as at
24 October 2019

Companies Act 1993

Part 15A s 239ADO

239ADM Administrator’s right of indemnity has priority over other debts
Subject to section 312, the administrator’s right of indemnity under this subpart
has priority over—(a)

all the company’s unsecured debts; and(b)debts of the company secured by a charge of the kind described in clause
2(1)(b) of Schedule 7.

Compare: Corporations Act 2001 s 443E (Aust)
Section 239ADM: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act
2006 (2006 No 56).

239ADN Lien to secure indemnity(1)

The administrator has a lien on the company’s property to secure a right ofindemnity under this subpart.

(2)

A lien under subsection (1) has priority over a charge to the same extent as theright of indemnity has priority over debts secured by the relevant charge.
Compare: Corporations Act 2001 s 443F (Aust)
Section 239ADN: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act
2006 (2006 No 56).

Subpart 17—Powers of court
Subpart 17: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act 2006
(2006 No 56).

239ADO Court’s general power(1)

The court may make any order that it thinks appropriate about how this Part isto operate in relation to a particular company.

(2)

For example, the court may terminate the administration under subsection (1) if
the court is satisfied that the administration should end—(a)because the company is solvent; or(b)because the provisions of this Part are being abused; or(c)for some other reason.

(3)

The court’s order may be made subject to conditions.

(4)

The court may make an order under this section on the application of—(a)the company or a shareholder of the company; or(b)a creditor of the company; or(c)the administrator; or(d)

the deed administrator; or(da) the FMA (if the company is a financial markets participant); or(e)

the Registrar; or233

Part 15A s 239ADP(f)

Companies Act 1993

Reprinted as at
24 October 2019any other interested person.

Compare: Corporations Act 2001 s 447A (Aust)
Section 239ADO: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act
2006 (2006 No 56).
Section 239ADO(4)(da): inserted, on 1 May 2011, by section 82 of the Financial Markets Authority
Act 2011 (2011 No 5).

239ADP Orders to protect creditors during administration(1)

On the application of the Registrar or, if the company is a financial markets
participant, the FMA, the court may make any order that it thinks necessary toprotect the interests of the company’s creditors while the company is in administration.

(2)

On the application of a creditor of a company, the court may make any orderthat it thinks necessary to protect the interests of that creditor while the company is in administration.

(3)

An order may be made subject to conditions.
Compare: Corporations Act 2001 s 447B (Aust)
Section 239ADP: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act
2006 (2006 No 56).
Section 239ADP(1): replaced, on 1 May 2011, by section 82 of the Financial Markets Authority Act
2011 (2011 No 5).

239ADQ Court may rule on validity of administrator’s appointment
(1)

(2)

If there is doubt, on a specific ground, as to the validity of the appointment of aperson as administrator or deed administrator, any of the following persons
may apply to the court for a ruling on the validity of the appointment:(a)the person appointed; or(b)the company in question; or(c)any of the company’s creditors.

In ruling that the appointment is invalid, the court is not limited to the grounds
specified in the application.
Compare: Corporations Act 2001 s 447C (Aust)
Section 239ADQ: inserted, on 1 November 2007, by section 6 of the Companies Amendment Act
2006 (2006 No 56).

239ADR Administrator may seek directions(1)

The administrator or the deed administrator may apply to the court for directions in relation to the performance or exercise of any of the administrator’sfunctions and powers.

(2)

The deed administrator may apply to the court for directions in relation to theoperation of, or giving effect to, the deed.
Compare: Corporations Act 2001 s 447D (Aust)

234

IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRY
CIV-2016-404-000105[2016] NZHC 36
UNDERPart 15A of the Companies Act 1993 andPart 19 of the High Court Rules

IN THE MATTERof an application pursuant to s 239AT of
the Companies Act 1993 for an order
extending the convening period in thevoluntary administration of DSE (NZ)
LIMITED (in receivership and voluntaryadministration)
ANDREW JOHN GRENFELL, KAREJOHNSTONE, JOSEPH DAVID HAYES
and JASON PRESTON as administratorsof DSE (NZ) LIMITED (INRECEIVERSHIP AND VOLUNTARYADMINISTRATION)
Applicants

Hearing:

28 January 2016

Appearances:S C D Gollin and M D Pascariu for Applicants
G P Blanchard for Interested Party

Judgment:

29 January 2016

JUDGMENT OF COURTNEY J

This judgment was delivered by Justice Courtney
on 29 January 2016 at 4.00 pm
pursuant to R 11.5 of the High Court Rules
Registrar / Deputy Registrar
Date………………………..

GRENFELL [2016] NZHC 36 [29 January 2016]

[1]DSE (NZ) Limited, which previously traded as Dick Smith, is in voluntaryadministration and receivership.1 The Administrators must convene a “watershedmeeting” by 2 February 2016 unless the period for doing so is extended by thisCourt.2 On 28 January 2016 I granted the Administrators’ applications for (1) leave
to apply without notice to extend the convening period and (2) an order extending
the convening period to 2 August 2016.
[2]

The application was served on three creditors on a Pickwick basis and one,Argosy Property (No 1) Ltd, appeared to oppose the applications. The orders madeincluded an express reservation of Argosy’s right to apply to set aside or vary them.
[3]

My decision was given on the basis that reasons would follow. These are myreasons.
Extension of the convening period under s 239AT of the Companies Act 1993
[4]

Section 239AT(1) of the Companies Act 1993 requires an administrator toconvene a “watershed meeting” within the “convening period”, which is the periodof 20 working days after the date of the administrator’s appointment and includes
any period for which it is extended.
[5]

A watershed meeting is:3
… the creditors’ meeting called by the administrator to decide the future of
the company and, in particular, whether the company and the deedadministrator should execute a deed of company arrangement.

[6]

Under s 239AT(3) the Court may extend the convening period on theadministrator’s application. The section is silent as to what considerations should betaken into account in allowing an application to extend time. However, I agree with
Heath J’s observation in Nylex (NZ) Ltd v Nylex Engineering Systems Ltd that the1

2
3

Receivers were appointed on 4 December 2015 and administrators appointed on 5 January 2016
with the leave of this Court pursuant to ss 239F and 280 of the Companies Act 1993.
Companies Act 1993, s 239AT(2).
Companies Act 1993, s 239B.

power should be exercised in the light of the purpose of the voluntary administration
regime and the duties imposed on administrators.4[7]

The objects of voluntary administration are identified at s 239A:… to provide for the business, property and affairs of an insolvent company,
or a company that may in the future become insolvent, to be administered ina way that –

[8]

(a)

maximises the chances of the company, or as much as possible of its
business, continuing in existence; or(b)

if it is not possible for the company or its business to continue inexistence, results in a better return for the company’s creditors andshareholders than would result from an immediate liquidation of thecompany.

Achieving these objectives requires the administrator to investigate thecompany’s affairs,5 report any suspected misconduct by directors, officers or
shareholders,6 call the first creditors’ meeting, the watershed meeting and othercreditors’ meetings as required.7[9]

In relation to the watershed meeting, the administrator must provide notice ofthat meeting to as many of the company’s creditors as reasonably practicable,
advertise the meeting and ensure that notice of the watershed meeting isaccompanied by his or her report about the company’s business, property, affairs andfinancial circumstances and any other matter material to the creditors’ decisions to beconsidered at the meeting with a statement setting out the administrator’s opinion,
with reasons, about the matters to be decided at the meeting, namely whether it
would be in the creditors’ interests for the company to execute a deed of company
arrangement or for the administration to end or for the company to be placed inliquidation.8 Self-evidently, the nature and extent of the work required to fulfil theseobligations will depend on the nature and complexity of the company that is the
subject of the administration. The provision for extending the convening period forthe watershed meeting recognises this fact.
4

5
6
7
8

Nylex (New Zealand) Ltd v Nylex Engineering Systems Ltd HC Auckland CIV-2009-404-1217,
11 March 2009 at [13].
Section 239AE.
Section 239AI.
Section 239AJ.
Section 239AU.

[10]Voluntary administration can, however, operate adversely on creditors. There

are barriers to the enforcement of charges over property during the administration of
a company9 and to the taking of possession of property used or occupied by thecompany.10 The granting of an extension requires consideration of both aspects.
[11]

The approach required to an application to extend the convening period has

been articulated in previous cases in both Australia (where the regime is very
similar) and New Zealand.

In Re Diamond Press Australia Pty Ltd Barrett J

described the approach as requiring:11… an appropriate balance between, on the one hand, the expectation thatadministration will be a relatively speedy and summary matter and on theother, the requirement that undue speed should not be allowed to prejudicesensible and constructive actions directed towards maximising the return for
creditors and any return for shareholders.

[12]

In Re Harrisons Pharmacy Pty Ltd (administrators appointed) Farrell J tookthat same approach:12
The approach to be taken by the Court in applications of this type is wellsettled. The power to extend the time for convening the second meeting is
one that should not be exercised as of course: ABC Learning Centres Ltd, inthe matter of ABC Learning Centres Ltd; application by Walker (No 5)[2008] FCA 1947 at [8] per Emmett J. The Court must strike an appropriatebalance between the expectation that administration will be a relatively
speedy and summary matter and 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: Re
Diamond Press Australia Pty Ltd [2001] NSWSC 313 at [10].

[13]

Heath J followed this approach in Nylex, as did Asher J in Postie Plus GroupLtd v Bridgman & McCloy.13 I, too, consider it to be the right approach.
[14]

The appropriateness of an extension is, self-evidently, a fact specificdetermination. However, factors likely to be relevant were identified in Re RivieraGroup Pty Ltd:14
9
10
11
12
13
14

Section 239ABC.
Section 239ABD.
Re Diamond Press Australia Pty Ltd [2001] NSWSC 313 at [10].
Re Harrisons Pharmacy Pty Ltd [2013] FCA458 (2013) at [11].
Postie Plus Group Ltd v Bridgman & McCloy [2014] NZHC 1337.
Re Riviera Group Pty Ltd [2009] NSWSC 585, (2009) 72 ACSR 352 at [13], followed in Re
WGL Retail Holdings Ltd [2011] NZCCLR 22 at [9].

(a)Size and scope of the business.

(b)

Substantial offshore activities.

(c)

Large number of employees with complex entitlements.

(d)Complex corporate structure and inter-company loans.

(e)Complex transactions entered into by the company (for example
securities lending or derivative transactions).

(f)Lack of access to corporate financial records.

(g)

The time needed to execute an orderly process of disposal of assets.

(h)

The time needed for a thorough assessment of a proposal for a deed ofcompany arrangement.

(i)Where the extension will allow the sale of the business as a going
concern.

(j)More generally, where additional time is likely to enhance the returnfor unsecured creditors.

[15]

Although the extension of the convening period is not granted as a matter ofcourse, in some cases the scale and complexity of the issues confronting
administrators are such that the question is not so much whether an extension should
be granted but what the length of that extension should be.15 A review of recently
decided cases suggests that six months (the period sought and granted in this case) isregarded as a significant period in this context. That period has been described as
being “at the top of the range”16 and “a long time”.17 In Postie Plus, Asher J notedthat in previous cases extensions of the convening period had ranged over four-and15

16
17

Mr Blanchard, for Argosy, acknowledged that the present case was one where some extension
was warranted, though he put the appropriate period at a matter of weeks rather than months.
Re WGL Retail Holdings Ltd, above n 13, at [26].
Re Harrisons Pharmacy Pty Ltd, above n 11, at [43].

a-half months,18 six months19 and 180 days20 before granting an extension of 61days.21 In at least one case, however, a much longer extension of 18 months was
granted.22
Reasons for extending the convening period[16]

The reasons for the applications appeared from affidavits filed by one of the

Administrators, Kare Johnstone, and one of the Receivers, Ryan Eagles. The firstwas the size and complexity of DSE coupled with the issues arising from its place aspart of the Dick Smith group.
[17]

DSE is part of the Dick Smith group of companies. Its ultimate owner isDick Smith Holdings Ltd (administrators appointed) (receivers and managers
appointed) ACN166 237 841. The group is one of the largest electronic retailers in
New Zealand and Australia. It had annual sales of approximately AU$1.3 billion in
the financial year to 28 June 2015. The New Zealand operation is closely connectedwith that in Australia. Head office functions, finance, IT and ordering are all dealt
with from the group’s head office in Sydney. Companies within the group, including
DSE, have cross-guaranteed the group’s secured borrowings of AU$135m.

In

Australia the group employs over 3,200 staff (full-time, part-time and casual) in 393
stores. In New Zealand DSE employs approximately 500 staff in 62 stores and one
distribution centre (this being owned by Argosy).
[18]

These circumstances mean that the Administrators do not have sufficient time

to obtain and analyse the information needed for a recommendation to creditors at
the watershed meeting. At this stage the directors have not yet been able to provide astatement of company position in accordance with s 239AF and have requested an
extension to 19 February 2016.
[19]

The second reason is that the return to the creditors will be maximised if asale of the group as a going concern can be achieved. But this will be a complex and
18
19
20
21
22

Re Nylex (New Zealand) Ltd v Nylex Engineering Systems Ltd, above n 4.
Re WGL Retail Holdings Ltd, above n 13.
Re Gourmet Food Holdings NZ Ltd [2012] NZHC 3606.
Postie Plus Group Ltd v Bridgman & McCloy, above n 12, at [22].
Re ABC Learning Centres Ltd [2008] FCA 1947.

time-consuming task. As well as trading under “Dick Smith” bannered stores, theDick Smith group trades under “Move” bannered stores which stock brands notoffered in Dick Smith branded stores, “Move by Dick Smith” which is an airport
duty free business, and “David Jones Electronics Powered by Dick Smith”, under an
exclusive retail brand management agreement with David Jones. The complex andvaried nature of these businesses and the leases and supply contracts associated withthem means that any sale process will be lengthy.
[20]

The receivers have proposed a timetable for the sale process that would see

final binding offers provided by 26 February 2016 and an anticipated settlement
period of up to 90 days. This may take three months or so. If a sale can be achieved
the Administrators would need time to analyse the implications of any proposed sale;a deed of company arrangement may be proposed, which would require time to benegotiated and considered before being put to creditors.
[21]

Thirdly, the inter-connectedness between DSE and the Australian companies

means that DSE’s administration will be more efficient if it can be co-ordinated withthe administration of the Australian companies, including common periods forconvening watershed meetings. An application to vary the convening period relating
to the Australia companies was made on the same day as the application before thisCourt was heard.
[22]

Fourthly, the moratorium that arises under voluntary administration willassist DSE’s business to continue trading, putting it in the best possible position forsale as a going concern, and the fact that the receivers are presently required tocontinue meeting lease obligations23 means that there is little prejudice to creditors
as a result of an extension being granted.
[23]

In these circumstances, it is not possible for the Administrators to provide any

meaningful recommendation or proposal to creditors as required by s 239AU(3).
Extension of the convening period was inevitable on that basis. The fact that sale of
the group’s business is likely to produce the best outcome for creditors and will takeseveral months means that the extension of six months was appropriate.
23

Re DSE (NZ) Ltd [2016] NZHC 10.

[24]I reached this view notwithstanding Argosy’s objection that where receivers

are in control of a company’s assets and are moving to sell the business it is wrong inprinciple to grant an extension of the convening period because that would
effectively confer the benefit of the moratorium on the receivers who would nototherwise be entitled to such a benefit under the Receiverships Act 1993.
Mr Blanchard, for Argosy, accepted that without a report from the directors, theAdministrators were not in a position to convene a watershed meeting yet so that, atthe least, an extension of 3 – 4 weeks would be needed. However, he resisted any
further extension and urged that the Administrators should proceed expeditiously to awatershed meeting at which creditors can make a determination as to whether thevoluntary administration should come to an end or the company should beliquidated.
[25]

Mr Blanchard acknowledged that the issue he was raising had not been

considered in any of the Australian or New Zealand cases in which companies had
both receivers and administrators appointed but pointed out that the earlier cases
involved unopposed applications and submitted that it was a serious point ofprinciple that ought to be fully argued. I was concerned that if, ultimately, the point
was decided against Argosy the Administrators and creditors could be significantly
disadvantaged by a refusal to grant an extension that was otherwise justified.
Although the point appears not to have been argued, the courts in all of the recent
cases have, nevertheless, regarded an extension of the convening period as available
where both receivers and administrators had been appointed. Further, there was noapparent prejudice to Argosy since the receivers are still liable to meet lease
payments and, as Mr Gollin for the Administrators pointed out, any creditor
particularly affected could seek relief under s 239ABD24 or apply to set aside or vary
the orders made.

____________________P Courtney J

24

Another landlord creditor has availed itself of this course and reached an agreement with the
Adminstrators allowing it take steps that would otherwise be precluded by the moratorium.

IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KOTI MATUA O AOTEAROATAMAKI MAKAURAU ROHE
CIV-2018-404-457[2018] NZHC 477
UNDER

Sections 239AT and 239 ADO of theCompanies Act 1993 and .Part 19 of the High
Court Rules 2016

IN THE MATTERofMECCANO 2016 LIMITED(ADMINISTRATORS APPOINTED)AND

Of an application by NEALE JACKSONAND GRANT ROBERT GRAHAM
Applicants

Hearing:

On the papers

Counsel:

M Kersey & S P Pope for Applicants

Judgment:

20 March 2018

JUDGMENT OF PAUL DAVISON JThis judgment was delivered by me on 20 March 2018 at 3pm
pursuant tor 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:
Russell McVeagh, Auckland

Background[l]This is an application by the administrators of Meccano 2016 Ltd (Meccano)for an order extending the period within which they must convene the watershedmeeting of creditors of the company to decide the future of the company.
[2]

On 21 February 2018 Mr Grant Graham and Mr Neale Jackson, both charteredaccountants and pminers in the firm KordaMentha, were appointedjoint and several
administrators ofMeccano pursuant to s 2391 of the Companies Act 1993 (the Act).
[3]

Mr Graham and Mr Jackson (the administrators) apply for orders pursuant tos 239AT of the Act extending the convening period within which they must hold thewatershed meeting of creditors. They apply for an extension of two months from 21
March 2018 to 23 May 2018. They fmiher seek an order enabling them to convene
the watershed meeting by notice of meeting before the convening period as extended
has expired, if they either conclude a sale of the business or otherwise form necessary
opinions before expiration of the extended convening period. The administrators alsoseek an order regarding the manner of them advising creditors of their application toextend the convening period, and directing that a copy of any orders made be servedon all creditors of Meccano and published on KordaMentha's website. Finally, theyseek an order reserving leave for any creditor ofMeccano to apply to vary or set aside
the orders prior to the next hearing date of this application.
[4]

Meccano is a New Zealand-based clothing designer, producer and retailer.

Prior to the administrator's appointment, Meccano operated 12 leased retail clothing
stores and one on-line store. The business employed approximately 56 staff members
at its stores and head office and had approximately 94 creditors to whom it owed atotal of approximately $1,432,000.
[5]Since their appointment as administrators, the applicants have taken steps tostabilise the business and have continued to trade whilst determining whether it will
be possible to achieve a sale of the business as a going concern. While they have beenendeavouring to sell the business as a going concern, to date thei·e has been little
interest and no progress has been made with achieving a sale. The applicants havenevertheless continued to achieve the objects of their appointment under the Act by

executing a structured stock liquidation process, and have developed a plan toperiodically consolidate Meccano's store network to match its stock levels. The
applicants terminated the employment of all Meccano 's employees within 14 days of
the administrator's appointment in order to limit the administrator's personal liability
and have commenced a process of re-employing a number of those employees on fixed
term aTI'angements. The applicants have also negotiated with landlords of Meccano 's
leased premises, and as at the date of the application had served non-use notices on
six landlords whilst still negotiating with six other landlords regarding assignments ofleases in order to provide additional value to creditors.
[6]

The applicants held the first meeting of creditors at the offices of K.ordaMentha

on 5 March 2018. At this meeting a creditor's committee was established and thecreditors were informed that the applicants intended to make an application to extend
the convening period of 20 working days within which the watershed meeting was
required to be held by two months, so as to enable futiher progress with theiradministration to occur and in order to enhance the prospects of improving realisationsof stock and assets and increasing recovery for creditors.
[7]

In his affidavit sworn in support of the application Mr Jackson explains:
Mr Graham and I intend to continue to trade the Meccano b~siness andcontinue our stock liquidation and store consolidation processes until we haveobtained sufficient information to form a view as to the realistic options
available to Meccano's creditors. In sh01t, the stability provided by being able
to trade from leased premises is likely to maximise recoveries from theinventory assets of Meccano".
Whilst we have formed the view that ... a going concern sale for the businessis not possible, we are taking steps (and intend to continue to take steps) tomaximise value for Meccano's creditors by:(a)continuing to seek expressions of interest for aspects of the business,such as the Meccano brand and the goodwill that it has generated;(b)

negotiating with landlords of various ofMeccano's leased premises totry and assign or transfer leases to third pmties. In some cases, thismay realise a cash return for Meccano and in others, this should limit
Meccano's ongoing liability under those leases;( c)considering, in conjunction with our investigations into the business,whether there is any value in proposing a [deed of company
arrangement] to creditors at the watershed meeting. We require
fmther time to:

(d)

[8]

(i)

consider the value in proposing a [deed of creditors
arrangement];(ii)

then potentially formulate a statement setting out the contents
and form of the proposed [deed of creditors ariangement],
which we must provide to creditors by notice prior to thewatershed meeting (see s 239AU of the Act); andinvestigating claims by potential secured creditors of Meccano to
determine whether there are any matters of priorit-; over certain assetsthat need to be resolved.

Mr Jackson further explains that the extension of the 20 worldng day watershedmeeting convening period will enable the applicants to have sufficient time to continue
an efficient stock liquidation strategy and inform creditors of the most suitable strategy
to maximise returns for them. He says that if the convening period is not extended,
there is a higher probability ofMeccano being placed into liquidation at the end of thecunent convening period, which would not be in the best interests of creditors,
employees, landlords and suppliers ofMeccano.
[9]

Mr Jackson says that in his view the proposed extension of the watershedmeeting convening period by two months would not prejudice any of the following
groups: creditors; those employees who are currently employed on fixed-termanangements and who will benefit from continued trading; or landlords, whose
premises are occupied and who are being paid for Meccano occupation or with whom
assignment of leases are underway.
Without notice application[10]

The application is made on a without notice basis without service having beeneffected upon creditors or employees.
[11]

I note Mr Jackson's explanation in his affidavit that the applicants informed

creditors attending the meeting on 5 March 2018 of their intention to apply for an
extension of the convening period without objection being raised by the creditors.
[12]

The convening period is due to expire on 21 March and the present application

is made on a without notice urgent basis. I am satisfied that the provision of notice ofthe present application to creditors and employees would involve delay and expense

in circumstances where unnecessary expenditure is to be avoided, and that it isunlikely that any of the employees or creditors will be adversely affected by anextension of time for the convening period. In fact, to the contrary, an extension of
the convening period is most likely to improve or enhance the interests of the creditorsand employees. For those reasons I am prepared to consider and determine thisapplication on a without notice basis.
Applicable law[13]

Section 239AS of the Act defines a watershed meeting as follows:
239AS What watershed meeting is

The watershed meeting is the meeting of creditors called by the administrator
to decide the future of the company and, in patiicular, whether the company
and the deed administrator should execute a deed of company arrangement.

[14]

Section 239AT of the Act provides that an administrator must convene thewatershed meeting within the convening period. The section provides as follows:
239AT Administrator must convene watershed meeting

[15]

(1)

The administrator must convene the watershed meeting within theconvening period.

(2)

The convening period is the period of 20 working days after the dateon which the administrator is appointed, and includes any period forwhich it is extended under subsection (3).

(3)

The Comi may, on the administrator's application, extend theconvening period.

(4)

The application to extend may be made before or after the convening
period has expired.

The convening period provided for of 20 working days after the date uponwhich the administrator is appointed may be extended on application by anadministrator made either before or after the convening period has expired.
[ 16]

Although the Court has an unfettered discretion to extend the convening

period, the discretion is to be exercised having regard to the objects of voluntaryadministration as set out ins 239A which provides:

239A

Objects of this Part

The objects of this Part are to provide for the business, property, and affairs of
an insolvent company, or a company that may in the future become insolvent,to be administered in a way that-

[17]

(a)

maximises the chances of the company, or as much as possible of its
business, continuing in existence; or,(b)

if it is not possible for the company or its business to continue inexistence, results in a better return for the company's creditors andshareholders than would result from an immediate liquidation of thecompany.

In Re Gourmet Food Holdings New Zealand Ltd, 1 Katz J set out the non-exhaustive list of reasons for extensions identified by Austin J in ]!.e Riviera GroupPty Ltd2 in relation to the Australian statutory equivalent of s 239AT. 3

The

circumstances justifying an extension of the convening period identified by Austin J
included the time needed to execute an orderly process of the disposal of assets; thetime needed for thorough assessment of a proposal for a deed of company
aTI'angement; time required to allow the sale of a business as a going concern; andmore generally the time being likely to enhance the return for unsecured creditors.
[18]

In Re Diamond Press Australia Pty Ltd, Barrett J observed: 4
The function of the Comi on an application such as this is, as I see it, to strike
an appropriate balance between, on the one hand, the expectation thatadministration will be a relatively speedy and summary matter and, on theother, the requirement that undue speed should not be allowed to prejudicesensible and constructive actions directed towards maximising the return for
creditors and any return for shareholders.

[19]

Applications for an extension of the convening period are not granted as amatter of course. Before the Court will exercise the discretion conferred by s239AT(3), an administrator must show that an extension is consistent with achieving
the objects of Part 15A, meaning that it will either maximise the chances of thecompany continuing in existence, or if that is not possible will be likely to achieve a
better return for the company's creditors and shareholders than would result from an
immediate liquidation of the company. The power confened on administrators to

2

Re Gourmet Food Holdings Ltd [2012] NZHC 3606.
Re Riviera Group Pty Ltd [2009] NSWSC 585, (2009) 72 ACSR 352,
Corporations Act 2001 (Cth), ss 439A(5)(a) and 439A(6).
Re Diamond Press Australia Pty Ltd [2001] NSWSC 313 at [10].

apply to extend the convening period and the Court's discretion to grant an extension
recognise that the circumstances of an adminstration will not infrequently encounter
issues that are not capable of prompt resolution and which require further time tostabilise and rationalise the business, continue trading in appropriate cases, realise
assets, and conduct a range of negotiations in order to achieve either the continued
existence of the business or a better outcome for its creditors and shareholders. Wheresound commercial and practical reasons are shown to support a realistic prospect of abetter outcome being derived following an extension of time, it will be appropriate for
the Court exercise the discretion to grant an extension.
[20]

As illustrated by the list of situations identified by Austin Jin Re Riviera GroupPty Ltd, there is a wide range of circumstances and situations where an extension may
be necessary in order to promote the achieving of the objectives of voluntaryadministration. In each case, however, the essential feature is that further time isnecessary to enable steps to be taken or matters to be resolved in a manner that will bein the interests of the company's creditors or shareholders, as contrasted to the likely
financial consequences of a liquidation.
The present case

[21]

Here the additional time sought of two months is reasonable, and will provide

further time for orderly progress to be made and for the watershed meeting to beconvened at a time when the administrators are able to provide creditors with a better
informed assessment of the business and the prospects of them achieving further
recoveries from sales of stock and assets, and whether to recommend that the company
execute a deed of company arrangement or alternatively that the administration should
end and a liquidator be appointed. 5·[22]

Having regard to the explanation provided by Mr Jackson of the situation andthe steps he and Mr Graham are taking, I am satisfied that the applicants are acting ina prudent and responsible manner consistent with achieving the objects of theiradministration of Meccano so as to maximise the chances of the company providing a

Companies Act 1993, s 239ABA.

better return for creditors and shareholders than would result from an immediateliquidation.
[23]

The applicants also seek an order authorising the convening of a watershedmeeting by notice of meeting before the convening period (as extended) has expired,should they be able to conclude a sale of the business or patis thereof or otherwise
form the necessary opinions before the completion of the extended convening period.
[24]

Once the convening period is extended, a watershed meeting may be convened

and notice thereof given by the applicants for any date within the extended period
provided that the requisite prior notice of five working days before the meeting isgiven, and provided that the notice of meeting otherwise complies with therequirements of s 239AU.
[25]

The applicants seek an order that the present application and a copy of theorders made herein be forwarded to all creditors of the company via their email
addresses where such email addresses are known, or by postal mail where email
addresses are not known. The applicants further propose posting a copy of the present
application and the orders on KordaMentha's website where that information will beaccessible to the public. I consider that those are practical, effective and efficientmeans by which notice of the present application and orders can be given to creditors.
Conclusions[26]

For these reasons I am satisfied that it is appropriate for an order to be madeextending the convening period by two months from 21 March 2018 to 23 May 2018
and I make an order that the applicants are able to convene the watershed meeting by
notice of meeting before the extended convening period has expired should theapplicants be able to conclude a sale of the business or parts thereof or otherwise form
the necessary opinions relating to their administration of the company.
[27]

I further order that notice of the present application being made and a copy ofthese orders shall be served upon all known creditors of Meccano by sending themcopies of the application and the orders made herein to creditors by email where an
address has been provided to Meccano, or by post to the postal address provided bycreditors in those instances where an email address has not been provided. I further
direct that a copy of the present application and of this judgment be posted on
KordaMentha's website for public access.
[28]

Finally, I reserve leave for any creditor of Meccano to apply to vary or set aside

these orders.

/Paul Davison J

IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRY
CIV-2014-404-001392[2014] NZHC 1337
IN THE MATTERof Part 15A of the Companies Act 1993

IN THE MATTER

of POSTIE PLUS GROUP LIMITED(ADMINISTRATORS APPOINTED)BETWEENDAVID JOHN BRIDGMAN and COLIN
THOMAS McCLOY
ApplicantsAND

Hearing:

On the papers

Counsel:LA O'Gorman for Applicants

Judgment:

13 June 2014

JUDGMENT OF ASHER J
This judgment was delivered by me on Friday, 13 June 2014 at 4.30 pm
pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:
Buddle Findlay, Auckland.

Background to this application[1]

On 3 June 2014 David John Bridgman and Colin Thomas McCloy,

insolvency practitioners and partners in the firm of PricewaterhouseCoopers, wereappointed as administrators of Postie Plus Group Ltd (Postie Plus). They apply foran extension of the time periods under ss 239AT and 239Y of the Companies Act
1993 on a without notice basis. The extensions are 61 days (to 1 September 2014)
and 82 days (to 1 September 2014) respectively. Mr McCloy has filed an affidavit insupport of the application.
[2]

Postie Plus is a retail business specialising in men’s, women’s and children’s

apparel and health and beauty products. It has over 100 years of history and is oneof the country’s largest retail chains. It operates over 80 stores throughout New
Zealand and employs approximately 650 staff nationwide. It is listed in the New
Zealand Stock Exchange.

Trading in the shares of Postie Plus is currently

suspended.
[3]

On 4 June 2014 the administrators entered into a heads of agreement withpotential purchasers of Postie Plus.

A statement was released to the media

announcing the intended purchase. The parties will endeavour to complete on or
about 2 July 2014.
[4]

As administrators of Postie Plus, Messrs Bridgman and McCloy (“theadministrators”) must convene a watershed meeting within the “convening period”
for Postie Plus.1 The convening period is stated in s 239AT(3) to be the period of 20
working days after the date on which administrators are appointed.
[5]

Given the large number of employees and sites, and the fact that there are 20

secured creditors and about 230 unsecured creditors, the administration of Postie
Plus is complex. The administrators are concerned that the requirements to provide
notices and reports for the watershed meeting by 1 July 2014 would significantly
distract them from their immediate goal of completing a sale of the business.
Mr McCloy asserts that the sale of the business will be the best outcome for creditors

1

Companies Act 1993, s 239AT(1).

and employees of Postie Plus, and that the next four weeks will be critical if they are
to complete such a sale. For example, there is the potential for some creditor
liability to be assumed by the potential purchaser given that the business has beensold as a going concern. Further, there is the possibility that the estimated timeframe
for completion of the sale will be delayed.
[6]

If the sale is not completed by the time of the watershed meeting it would be

impractical for the creditors at the watershed meeting to consider Postie Plus’s affairs
and whether it would be appropriate to end the administration. It would be far morepractical for there to be more time to finalise a report and post the notice to allcreditors and employees. If the sale did not go ahead there would be more time toconsider alternative options and report on those.
[7]

For these reasons the administrators seek the extension to the convening

period to 1 September 2014.

This period will allow the due diligence andnegotiation process to be completed, and for informed reports to be provided.
[8]

The same period of extension is sought in relation to the period of time set

out in s 294Y(3) of the Companies Act in which the administrators are required togive notice of termination of contracts of employment. So if an extension is notgranted the administrators will have to give notice of termination to every employee
by Tuesday, 17 June 2014. At the same time formal offers of re-employment would
have to be made to each employee, with the necessary documentation.
[9]

Mr McCloy deposes that this would be difficult to achieve within the 14 day

period given the number of employees involved. It would also add further disruption
to the sale process. Further, if a sale is confirmed it would be a pointless andwasteful exercise to carry out these steps when Postie Plus would be required toterminate their employment again in a transfer of business scenario a short time later.
[10]

The administrators have advised the employees of their intention to seek an

extension of the 14 day period by a letter of 4 June 2014. To date there has been no
notice of any opposition to the extension.

[11]I consider the application against this background.

Without notice application[12]

The issue is whether it is appropriate to determine these applications without

notice, and in particular without service on creditors and employees.
[13]

I am satisfied that it would be a considerable expense and cause delay tocarry out such service. Further, it is unlikely that any of the employees or creditors
would be adversely affected by the extensions of time sought for reasons that I will
elaborate on below.
[14]

The administrators undertake to notify the creditors of Postie Plus byadvertisements and by notification on a webpage on the PricewaterhouseCoopers
website. I am informed that the Bank of New Zealand, the first ranking secured
creditor, supports the application.
[15]

Given these practical realities, and the urgency of the situation, I am prepared

to consider the application on a without notice basis.
Application for the extension of the convening period[16]

The object of voluntary administration in Part 15A is set out in s 239A of theAct:
239A Objects of this Part
The objects of this Part are to provide for the business, property, and affairsof an insolvent company, or a company that may in the future become
insolvent, to be administered in a way that—(a) maximises the chances of the company, or as much as possible of its
business, continuing in existence; or(b) if it is not possible for the company or its business to continue inexistence, results in a better return for the company's creditors andshareholders than would result from an immediate liquidation of thecompany.

[17]While Postie Plus is in administration there is a statutory moratorium

imposed by subpart 9 of Part 15A against enforcement action from creditors. Thismaximises the chances of Postie Plus remaining in business.
[18]

Administrators may however need additional time to carry out their tasks. In

recognition of this the legislature has provided for extensions of the convening
period for the watershed meeting,2 and for an extension of the time period within
which notice of termination of contracts of employment is required to be given.3[19]

Orders for the extension of time are not made as a matter of course and are

the exception rather than the rule.4 However, they will be more frequently granted
where the company structure is complex. Any application for an extension has to besupported by detailed information about the affairs of the company so far as they are
known, and the reasons for the extension must be clearly stated.
[20]

In deciding whether to grant an extension, the Court’s function has been

described by Barrett J in Re Diamond Press Australia Pty Ltd as:5
[striking] an appropriate balance between, on the one hand, the expectationthat administration will be a relatively speedy and summary matter and, on
the other, the requirement that undue speed should not be allowed toprejudice sensible and constructive actions directed towards maximising thereturn for creditors and any return for shareholders.

[21]

A Court must be wary of the possibility of the administration processes bing

exploited by a company that seeks to delay enforcement action by creditors.
However, when the statutory moratorium is properly imposed it can maximise acompany’s chances of remaining in business and improve creditors’ chances ofrecovery. As Heath J commented in Re Nylex (New Zealand) Ltd:6… in a case where complexity reigns and an Administrator cannot, in thetime prescribed, conduct a proper investigation to form opinions to put tocreditors at a watershed meeting, it is appropriate (and indeed necessary) toextend the convening period so that the Administrator can perform his or her

2
3
4
5
6

Companies Act 1993, s 239AT(3).
Companies Act 1993, s 239Y(4).
Re All Build Construction Co Pty Ltd; ex parte Featherby [2000] WASC 227.
Re Diamond Press Australia Pty Ltd [2001] NSWSC 313.
Re Nylex (New Zealand) Ltd HC Auckland CIV-2009-404-1217, 11 March 2009 at [19].

functions properly and creditors, at the watershed meeting, can makeinformed decisions.

[22]

Extensions of the convening period of four and a half months,7 six months8

and 180 days9 have been made.
[23]

I consider it appropriate to grant an extension of the convening period for thefollowing reasons:(a)

The administration is complex and involves a large number of
employees, multiple sites and multiple secured and unsecured
creditors. It is understandable that the administrators wish to focus on
the all important issue of a constructive sale of the business at thispoint. A sale is likely to be the best outcome for creditors andemployees.

(b)

It is possible that a sale may not be completed at the time when thewatershed meeting would be held within the statutory timeframe. If
that was so it would be difficult for the creditors to consider the bestcommercial way forward for Postie Plus. If there was a sale there
would be little time to finalise a report and for that to be consideredby creditors and employees.

(c)

The alternative to sale would be a restructure of the business, thatwould take time to formulate.

[24]

I am prepared to grant the extension sought of the convening period.

Extension of the time for terminating contracts of employment[25]

The principles applied in considering an extension of the 14 day period ofnotice of termination to employees are closely related to those relating to an
extension of the convening period. The Court will be concerned to facilitate a78
9

Re Nylex, above n 6.
Re WGL Retail Holdings Ltd [2011] NZCCLR 22.
Re Gourmet Food Holdings New Zealand Ltd [2012] NZHC 3606.

constructive outcome of the administration which will ensure that the businesssurvives and contracts of employment can be maintained to the advantage of both
employees and creditors. In complex administrations a Court will be concerned toensure that the administrators will have time to identify all employment contracts
and make informed decisions concerning those contracts. They will then have tocommunicate any discussions to the relevant employees.
[26]

The administrators depose that if the extension of the 14 day period is notgranted they will give notice of termination to every employee by Tuesday, 17 June
2014. At the same time formal offers of re-employment would have to be made toeach person with the necessary documentation being prepared, checked andexecuted.
[27]

The administrators believe the task of carrying out these tasks within 14 days

would be difficult to achieve, and could further disrupt the sale process. Further, if asale was confirmed the termination would have been a pointless and wasteful
exercise, when Postie Plus would be required to terminate employment in a transferof business scenario a short time later.
[28]

There is some indication that the extension is not against the interests of

employees that can be taken from the lack of any expressed opposition, despite thefact that notice has been given of the proposal.
[29]

For these reasons I am prepared to grant the extension of the notice oftermination period.
Other factors
It is relevant to a decision to grant extensions that the proposed orders will be
advertised with leave to apply in the application. Leave will be granted for any
person who can demonstrate a sufficient interest to apply to modify or discharge theorders.

Result[30]

I make the following orders:(a)the applicants are granted leave to commence this proceeding without
notice;(b)

the period defined in s 239AT(2) of the Companies Act is extended by
61 days up to and including 1 September 2014, under s 239AT(3) ofthe Act;(c)the period defined in s 239Y(3) of the Act is extended by 82 days up
to and including 1 September 2014, under s 239Y(4) of the Act;(d)within seven days of the date of these orders, notice of these orders is
to be:(i)Made

availableon

PricewaterhouseCoopers’

website:http://www.pwc.co.nz/postie-plus/;(ii)

Advertised once in the New Zealand Herald, The Dominion,
The Press and the Otago Daily Times;(e)leave to apply is granted to any person who can demonstrate asufficient interest to modify or discharge either the above orders upon
appropriate notice being given to the applicants; and(f)the applicants’ solicitor/client costs of this application will be an
expense incurred by the applicants in carrying out their duties asadministrators of Postie Plus.

……………………………..
Asher J

Westlaw NZ Delivery Summary
Request made by:
Rachael Choy
Request made on:Thursday, 14 November, 2019 at 12:15 NZDTContent Type:Legislation
Title
239ADO Court's general power
Delivery selection:
Current Document
Number of documents delivered: 1

Copyright © 2019 Thomson Reuters New Zealand Limited

Insolvency Law & Practice239ADO Court's general power
Legislation:

Companies Act 1993 (New Zealand)| View all PDF versions

Document Path:• Insolvency Law & Practice : Corporate Insolvency > Compromises with Creditors and Voluntary
Administration > Companies Act 1993 > Companies Act 1993 > [Part 15A Voluntary administration - (s239A - s 239AEW) > Subpart 17 Powers of Court - (s 239ADO - s 239ADV)LEGISLATIONCURRENT VERSION (APPLIES FROM 1 MAY 2011)
239ADO Court's general power(1)

The Court may make any order that it thinks appropriate about how this Part is to operate in relation to a particularcompany.

(2)

For example, the Court may terminate the administration under subsection (1) if the Court is satisfied that theadministration should end—(a)because the company is solvent; or(b)because the provisions of this Part are being abused; or(c)for some other reason.

(3)

The Court's order may be made subject to conditions.

(4)

The Court may make an order under this section on the application of—(a)the company or a shareholder of the company; or(b)a creditor of the company; or(c)the administrator; or(d)

the deed administrator; or[(da)the FMA (if the company is a financial markets participant); or](e)

the Registrar; or(f)any other interested person.

Compare: Corporations Act 2001 (Australia) s 447A

COMMENTARY
Synopsis
The Court has the power to make such order as it thinks fit as to how Part 15A is to operate in relation to a particular company. The
company, a shareholder, a creditor, the administrator, the deed administrator, the Registrar or any other interested person may
request the Court that it make an order in s 239ADO. The provisions of s 239ADO are virtually identical to those of s 447A, s
239ADO’s Part 5.3A equivalent.
Cross referencess 2 “company”, “Court”, “Registrar”, “shareholder”
s 96 meaning of “shareholder”
s 239A objects of this partThursday, 14 November, 2019 at 12:15

Page 1

Insolvency Law & Practices 239B “administrator”, “deed administrator”
s 239C “company”, “creditor”, “insolvent”
s 239E when administration ends
s 239I appointment by companys 239AU notice of watershed meetings 239AZ adjournment of watershed meetings 239ACS who is bound by deeds 239ADR administrator may seek directions

CA239ADO.01 Nature of the power
The purpose of the section is to provide the Court with the power to make orders that alter the way in which Part 15A operates (Brash Holdings Ltd v Katile Pty Ltd (1994) 12 ACLC 472) so as to ensure that the objectives of Part 15A are maintained in the caseof a particular company: Australasian Memory Pty Ltd v Brien (2000) 172 ALR 28 (HCA). Subsection (2) provides an example of
one use of s 239ADO — termination of the administration because the administration procedure is being abused (such as where
the board has put the company in administration for purposes at variance with the s 239A statutory objectives) or because thecompany is solvent. In Australia the Part 5.3A equivalent of s 239ADO has been used (among other things) to cure failures tocomply with time periods (even where the time period concerned is mandatory) or to amend a deed of company arrangement (eventhough there are specific provisions in Part 15A dealing with deed variations) or to validate an improper appointment of an
administrator.

(1) Case examples — validation of improper appointments(a) Panasystems Pty Ltd v Voodoo Tech Pty Ltd
In Panasystems Pty Ltd v Voodoo Tech Pty Ltd (2003) 21 ACLC 842, the administrator’s appointment was ruled invalid because therelevant board resolution made no reference to the actual or prospective insolvency of the company (see s 239I) but only that thecompany was in “serious financial difficulties”. The Court was however, prepared to validate the appointment under the Part 5.3A
equivalent of s 239ADO. It was accepted by all that the company was in fact insolvent when the resolution passed. That was the
directors understanding even if the board minute did not express this. Also, there was no prejudice that could be identified incontinuing the administration.

(b) McVeigh v Merlo
In McVeigh v Merlo [2004] VSC 107, a defect that occurred in the appointment of an administrator due to a lack of quorum at therelevant board meeting was “fixed” by the Court by validating the relevant directors resolution.

(c) Re Pasdonnay Pty Ltd
In Re Pasdonnay Pty Ltd [2005] FCA 335, the sole director of a company communicated his intention to a company consultant that
he would put the company into voluntary administration if a settlement in certain ongoing legal proceedings could not be reached bya specified date. The necessary company resolution was signed by the director. The director then fell ill and was in hospital at thetime the deadline passed for settlement of the litigation. The consultant arranged to meet with the proposed administrators on thefollowing Monday. The director died on the weekend. The subsequent appointment that was facilitated by the consultant was ruled
invalid. The intentions of a director cannot survive his or her death. However, the appointment was validated. The administration
was well advanced, it was likely that the business would be sold as a going concern and it was therefore in the interest of theshareholders and creditors that the administration should continue.

(d) Albarran v Pascoe
In Albarran v Pascoe [2006] NSWSC 418, an administrator had been appointed by board resolution under the Part 5.3A equivalentof s 239I. The two persons acting as directors of the company were found to be not capable of acting in that capacity due to theirstatus as undischarged bankrupts. The Court was, however, prepared to validate the appointment. In making its determination the
Court noted that the company’s creditors had been made aware of the validation application and had made no objection. The
validation ruling enabled the administrator to proceed with plans for the sale of the company’s business.

NZDT

Insolvency Law & Practice(2) Extension of time limits(a) Cawthorn v Keira Constructions Pty Ltd
In Cawthorn v Keira Constructions Pty Ltd (1994) 33 NSWLR 607, the principal assets of the company comprised a number oflicences granted by the Government of Vietnam. It became clear during the negotiations with the Vietnamese government that there
were further licences that had not been initially identified. The creditors of the company considered that it would be appropriate forthe administrator to carry on discussions with Vietnamese government officials beyond the 60 day maximum period for the
adjournment of the watershed meeting allowed for by the Part 5.3A equivalent of s 239AZ (the maximum period for an adjournmentof a watershed meeting under Part 15A is in fact 30 working days). A resolution had been passed asking the administrator to apply
to Court for an extension of time to enable a thorough examination to take place as to the viability of a sale of the licences. Failure
to obtain such an extension would have meant that the administration would be terminated. The Court concluded that it had in theappropriate case, power to order an extension of time under the Part 5.3A equivalent of s 239ADO. While the 60 day limit allowed
for adjournment of the watershed meeting was necessary to avoid unnecessarily prolonged administrations (such as could arise in
the US under its Chapter 11 bankruptcy procedure) the legislation conferred wide ranging plenary powers on the Courts to ensure
the objective of the exercise was fulfilled (that is whether it is in the creditor's interests to have some form of administration short ofwinding up). In deciding whether to exercise these plenary powers it was necessary however for the Courts to take account of therights of the various groupings affected by the voluntary administration, and the very great public interest in not permitting a
voluntary administration to go on for too long. In this case the Court decided that an extension of time beyond the 60 day
adjournment period was justified. The reason for the extension was to see whether a formal deed administration would be more
successful, that a winding-up of the company. The delay sought was not being used as a delaying tactic to keep creditors at bay.

(b) Re Double V Marketing Pty Ltd
In Re Double V Marketing Pty Ltd (1995) 16 ACSR 498, the Court made an order providing for adjournment of the watershedmeeting beyond the 60-day maximum allowed for in the Part 5.3A equivalent of s 239AZ. Complex legal issues arising over a
dispute over trading stock and whether the company’s custom’s agent had a valid lien over that stock had meant that theadministrator was not in a position to provide his report and statement to the meeting as required by the Part 5.3A equivalent of s
239AU(3). In addition the directors had advised that they needed an additional 14 days in which to finalise their proposal andrecommendation to creditors. Furthermore the proposal for an adjournment to a date beyond the 60-day period had been put to an
earlier meeting of creditors. The majority had voted in favour of that adjournment, subject to the Court's approval. There was noevidence of any prejudice to any creditor.

(c) Australasian Memory Pty Ltd v Brien
In Australasian Memory Pty Ltd v Brien (2000) 172 ALR 28 (HCA), at p 35, the High Court of Australia commented on theapplication of the Part 5.3A equivalent of s 239ADO to the extension of statutory time limits in this way:
“Section 447A is an integral part of the legislative scheme provided for by Pt 5.3A. In its terms, it enables the making oforders which alter the way in which ‘this Part is to operate in relation to a particular company’. That is, it permits the makingof orders which would alter how s 439A is to apply. It is not right to seek to characterise s 447A as some general source ofpower to which resort cannot be had because to do so would ‘circumvent’ the statutory limitations upon the exercise of thepower that is given by s 439A(6) to extend the convening period. So to characterise s 447A is to give to all of the otherprovisions of Pt 5.3A a fixed and unchanging operation in relation to all companies. Yet the evident legislative intention of s
447A is to permit alterations to the way in which Pt 5.3A is to operate”.

(3) Amendments to existing deeds of company arrangement(a) Mulvaney v Rob Wintulick Pty Ltd
In Mulvaney v Rob Wintulich Pty Ltd (1995) 18 ACSR 384, a deed of company arrangement was entered into on the mistaken
assumption that shareholders would be bound to accept nominal consideration for the transfer of their shares in the company
pursuant to the Part 5.3A equivalent of s 239ACS (who is bound [by deed of company arrangement]). Some of the shareholders
objected. A new agreement was then made which provided for transfer of all the company shares for nominal consideration subject
to the making of a further payment to one of the shareholders in settlement of a dispute between that shareholder and theThursday, 14 November, 2019 at 12:15

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Insolvency Law & Practicecompany. The administrators applied to the Court for validation of a new version of the deed of company arrangement reflecting theterms of this agreement. The Court held that as no specific ground had been identified for validation of the new deed, s 445G (thePart 5.3A equivalent of s 239ACX) could not be used to affirm the deed’s validity. However, the Court was prepared to use its
powers under the Part 5.3A equivalent of s 239ADO to allow the variation in the deed, notwithstanding that no resolution of thecompany’s creditors had been passed approving the variation. The Court was prepared to exercise its discretion in this casebecause:
(i)

(ii)

(iii)

The persons whose interests the variation might be thought to affect (ie the other shareholders who were not to receive any
additional payment) have joined the agreement which gave rise to the variation;

A meeting of the creditors could not now be practically convened prior to the deed’s operative date; andAn earlier meeting would have resulted in appreciable (and arguably unneccessary) costs being incurred by theadministration and in some inconvenience to the creditors.

(b) Re Motor Group Australia Pty Ltd
In Re Motor Group Australia Pty Ltd (2005) 54 ACSR 389, there were doubts over whether motor vehicle owners with warranty
entitlements that had made no claim against the company prior to its administration, were in fact creditors or mere holders of
expectant claims. In these circumstances, the Court exercised its powers under the Part 5.3A equivalent of s 239ADO to order thatthose warranty holders were bound to the deed, without making any final determination as to their status as creditors. The order
was made on the basis that the deed would achieve a better result for the company’s creditors than would be the case if thecompany had been put into liquidation.

(4) Other cases on exercise of Court’s general power(a) Adams Plumbing and Drainage (2010) Ltd v Hartland Construction Ltd
Section 239I(3) provides that a company must not appoint an administrator if the company is already in liquidation. However in
Adams Plumbing and Drainage (2010) Ltd v Hartland Construction Ltd [2012] NZHC 1095, the Court gave leave to the directors to
appoint an administrator in a proceeding before the Court for the appointment of a liquidator. (The 10-working-day period given to
the directors under subs (4) of s 239I to appoint an administrator following service on the company of the liquidation application had
expired). The Court, citing Australasian Memory Pty Ltd v Brien, granted leave based on the powers conferred on the Court under s239ADO (Court's general power). The Court noted that that the company had been affected by termination of its franchise inrelation to a national franchise arrangement. The company had subsequently been in a difficult financial position and had worked
with its creditors to bring about a restructuring proposal that would work. The director’s application for leave was supported bycreditors appearing at the hearing (including the creditor that initiated the liquidation application). The Court concluded that this wasa case where voluntary administration appeared to be in the best interests of the company and its creditors.

(b) Re Sims; in the matter of Huon Corp Pty Ltd
In Re Sims; in the matter of Huon Corp Pty Ltd [2006] FCA 1201, the administrators proposed to enter into four supply agreements
under which the purchasers agreed to pay a 35 per cent mark-up for the product over the normal supply price and to commit to thepurchase of specified volumes over a four month period. In return, the administrators agreed to pay the purchasers a price rebate tobe paid to them ahead of the claims of the company’s unsecured creditors. These commercial arrangements were intended toenable the company to continue to trade for a few more months as a going concern, pending sale of the business. An application to
Court was made to seek confirmation that the administrator’s obligation to pay the price rebate under the proposed arrangements
was a “debt” (pursuant to s 443A, the Part 5.3A equivalent of s 239H) and, therefore, subject to the statutory lien that confers
priority on claims in respect of the administrator’s personal liability in the performance of their functions. The Judge was notprepared to concede that the “price rebate” could be construed as a debt for the purposes of s 443A. However, the Court was
prepared to exercise its powers under the Part 5.3A equivalent to s 239ADO to deem the price rebates as “debts incurred” by theadministrators for the purposes of s 443A in respect of “services rendered”, for which they would be personally liable, and thestatutory lien would apply.

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Insolvency Law & Practice(c) Re Ansett Australia Ltd
In Re Ansett Australia Ltd (2002) 115 FCR 395, the Court was unwilling to exercise its discretion under s 239ADO to allow thenotice of the watershed meeting to be made to Ansett’s thousands of creditor’s simply by way of news paper advertisements, two
web sites and a telephone facility to enable creditors to request copies of the documentation for the meeting. While the cost of
posting the notice of the meeting (plus the supporting documentation) to “as many of the company’s creditors as reasonable
practicable” would be substantial, that cost was not disproportionate to the object of ensuring that the company’s creditors were
given a proper opportunity to attend the watershed meeting and to cast their vote on an informed basis. However the Court was
prepared to make an order that did not require the supporting documentation (the administrator’s report and statement plus detailsof the proposed deed of company arrangement) to be sent with the written notice. Instead it was sufficient for the written notice toinform creditors that the relevant information required to be provided by the administrators could be obtained by telephoning theadministrators and requesting copies, and that that information could also be viewed and downloaded from two web sites.

(d) Re Pumpkin Patch Ltd
In Re Pumpkin Patch Ltd [2016] NZHC 2771, the court made an order under s 239ADO(1) allowing for documents “accompanying”
the notice of the watershed meeting (as per s 239AU) to be made “available” (rather than “sent”) to the company’s creditors by
publication on the administrators’ website. In doing so, the administrators were required to send each creditor a letter (separate
from the watershed meeting notice) referring creditors to the administrators’ website and advising that copies of the s 239AU“accompanying documents” could be sent by post or e-mail to a particular creditor on request. The Court considered that thesearrangements would maximise the likelihood that creditors would have sufficient time to consider the documents before thewatershed meeting. The order also preserved the option of a creditor obtaining hard copy versions of the documents if that is what
the creditor preferred.

(e) Re Kruger Engineering Pty Ltd
In Re Kruger Engineering Pty Ltd [2006] NSWSC 1063, a watershed meeting was convened by the company’s administrator under
the Part 5.3A equivalent of s 239AU. The deed proposed was voted on and approved, but the company’s sole director sought andobtained a postponement of the deadline for the deed’s execution. At a further meeting of the creditors the director on advice fromhis own insolvency consultant argued that the objects of the approved deed would likely be unachievable. He then outlined a
proposal for an alternative deed of company arrangement. The administrator then called another meeting of creditors at a later
date. The notice of the meeting outlined the terms of the revised deed. At that meeting the new deed was tabled. The creditors
voted on and voted for the new deed of company arrangement (both by number and by value). The director’s insolvency advisor
was appointed deed administrator. Later, when doubts surfaced about whether correct process had been followed (the last meetingof creditors had not been convened under the Part 5.3A equivalent of s 239AU; that having been done only for the first meeting at
which the original deed of company arrangement had been voted on), it was decided to make an application to Court for an orderunder the Part 5.3A equivalent of s 239ADO. The relief sought was validation of the second deed of company arrangement. Noticeof this application was given to each creditor with an invitation to appear if any wished to be heard by the Court. The Court decided
that it had the power to make the requisite s 447A order [s 239ADO order] to validate the later deed of company arrangement andthat it would so. There had already been a clear expression of the creditor’s wishes at the last meeting. The new deed of company
arrangement had been in operation for five months and everyone had conducted themselves on the basis that this deed was valid.
Furthermore, no creditor has availed itself of the opportunity to oppose the application, when they had all been given the opportunity
to do so.

CA239ADO.02 Scope of the power
In Australasian Memory Pty Ltd v Brien (2000) 172 ALR 28 (HCA), the High Court of Australia expressed its views on the scope of s
447A (the Part 5.3A equivalent of s 239ADO).
To begin with (at p 33):
“orders that may be made under section 447A(1) are described as orders about how Part 5.3A is to operate ‘in relation to aparticular company’. The power is not cast in terms of a power to cure defects or to remedy the consequences of somedepartures from [the voluntary administration] scheme. Nor is there anything on the face of section 447A(1) that suggeststhat it should be read down. In particular the words of the provision are wide enough to confer powers to make orders which
will have effect in the future but which are occasioned by something done (or not done) under the other provisions of Part
5.3A before the application is made under section 447A(1)”Thursday, 14 November, 2019 at 12:15

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Furthermore (at pp 33 to 34):
“it is clear from [the examples given in sub section (2) — such as the power of the Court to act if it considers that the otherstatutory provisions governing the voluntary administration scheme are being abused] that they assume that orders under
section 447A(1) may alter the operation of [those] other provisions…[so as to ] go beyond a curial determination of what isthe effect of [those provisions] on a particular company… [T]he orders contemplated [by section 447A] are orders that alter
how the Part is to operate in relation to a particular company, not how the Part does operate in relation to that company”
Accordingly (at p 35):
“It is not right to seek to characterise s 447A as some general source of power to which resort cannot be had because to doso would ‘circumvent’ the statutory limitations [on say the Court’s ability to extend the notice period for the watershedmeeting]. So to characterise s 447A is to give to all of the other provisions of Pt 5.3A a fixed and unchanging operation in
relation to all companies. Yet the evident legislative intention of s 447A is to permit alterations to the way in which Pt 5.3A is
to operate”.
In addition, while (at p 36):
“it may be accepted that the expression ‘how this Part is to operate’ is an expression that looks to the future, not the past …
[that] does not preclude the making of an order with future effect, but in respect of past matters or events [so long as theorder takes effect only from the time of its making]”
On this basis there was nothing to limit a s 447A order to an existing administration or to a deed of company arrangement only
while it is in force. Section 447A applies in relation to a particular company, not just in relation to a particular administration.
Finally, in considering the proposition that no s 447A(1) order should disturb rights that have accrued or vested the Court
distinguished two different situations. The first concerned the situation where the company had come out of voluntary administrationand had been returned to the control of the company’s directors. The Court was not willing to say whether a s 447A order should
never be made to wind back transfers of shares or other kinds of transactions upon say the reinstatement of a voluntaryadministration. The facts of the particular case before it, did not demand that it take a final view on issues of this type. However the
Court did say that where an administration had ended and the company had entered liquidation, an order under s 447A could not
be viewed as adversely affecting rights accruing since the end of the voluntary administration. On this basis the Court decided thatany defects associated with the holding of a watershed meeting that resulted in the company being put into liquidation, werecapable of remediation so as to validate the liquidator’s appointment.

CA239ADO.03 Relationship with s 239ADR
An application should not be made under s 239ADO if the purpose of the application is to seek guidance as to how the legislative
effect of Part 15A applies in specific circumstances. In that case an application should be for directions under s 239ADR.
Furthermore, an application made to the Court that involves a proposal that could affect the rights of third parties, is best done by
way of request for directions under s 239ADR rather than as an application for an order under s 239ADO. The giving of directions
by the Court does not prevent those that might be adversely affected as a result from arguing a contrary view if the decision of theadministrator, based on the directions, is disputed: Re Zambena Pty Ltd (1995) 13 ACLC 1020. The alternative is for the Court toadjourn the s 239ADO application to allow third parties that could be affected by the order sought, to be notified: see Re Edward
Gem Pty Ltd (2005) 141 FCR 408.

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