In the matter of Cirrus Networks Holdings Ltd [2023] NSWSC 1298

In the matter of Cirrus Networks Holdings Ltd [2023] NSWSC 1298

The Court made the convening orders because Cirrus Networks satisfied the preconditions for the exercise of power under s 411(1) of the Corporations Act 2001 (Cth), including that it was a Part 5.1 body, the proposal was an arrangement with shareholders as a single class, ASIC had a reasonable opportunity to review the scheme booklet and did not oppose the first Court hearing, verification and procedural requirements were met, and there was no apparent reason the scheme should not later receive approval if approved by the required majorities. The identified scheme features were sufficiently disclosed or consistent with accepted practice and did not require separate classes or otherwise...

Jurisdiction
Australia
Judgment Date
31 October 2023
Procedural Posture
Application Under S 411 of the Corporations Act 2001 (cth) for Orders Convening Meeting of Members to Consider Proposed Scheme of Arrangement / First Court Hearing
Outcome
Order convening scheme meeting and associated orders made.
Legal Topics
['schemes of Arrangement' 'arrangements and Reconstructions' 'convening Scheme Meeting' 'scheme Booklet Disclosure' 'alternative Scheme Consideration' 'scale Back Provisions' 'ineligible Foreign Shareholders' 'unmarketable Parcel Shareholders' 'exclusivity Provisions' 'break Fee']
['corporations Law'] ['schemes of Arrangement' 'arrangements and Reconstructions' 'convening Scheme Meeting' 'scheme Booklet Disclosure' 'alternative Scheme Consideration' 'scale Back Provisions' 'ineligible Foreign Shareholders' 'unmarketable Parcel Shareholders' 'exclusivity Provisions' 'break Fee']

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Procedural Posture

Application Under S 411 of the Corporations Act 2001 (cth) for Orders Convening Meeting of Members to Consider Proposed Scheme of Arrangement / First Court Hearing

Legal Issues

  1. 1 ['Whether the requirements for orders convening a meeting of Cirrus Networks shareholders to consider the proposed scheme of arrangement were satisfied.' 'Whether the proposed scheme was of such a nature and cast in such terms that, if approved by statutory majorities, the Court would be likely to approve it at an unopposed second Court hearing.' 'Whether particular aspects of the scheme, including alternative consideration and scale-back provisions, default consideration, treatment of equity incentives, Ineligible Foreign Shareholders, Unmarketable Parcel Shareholders, performance risk protections, exclusivity provisions, break fee provisions and shareholder communications, provided any reason not to convene the scheme meeting.']

Ratio Decidendi

The Court made the convening orders because Cirrus Networks satisfied the preconditions for the exercise of power under s 411(1) of the Corporations Act 2001 (Cth), including that it was a Part 5.1 body, the proposal was an arrangement with shareholders as a single class, ASIC had a reasonable opportunity to review the scheme booklet and did not oppose the first Court hearing, verification and procedural requirements were met, and there was no apparent reason the scheme should not later receive approval if approved by the required majorities. The identified scheme features were sufficiently disclosed or consistent with accepted practice and did not require separate classes or otherwise...

Court Disposition

Order convening scheme meeting and associated orders made.

Orders

  • ['Cirrus Networks was ordered to convene a meeting of holders of its ordinary shares in respect of the proposed scheme of arrangement.' 'Associated orders sought by Cirrus Networks were made at the conclusion of the first Court hearing.']