Notice of Offer of Same Class Financial Products for Issue
Chatham Rock Phosphate Limited (Chatham Rock) intends to undertake a pro-rata 2 for 17 renounceable rights offer for new ordinary shares in Chatham Rock (New Shares) to Chatham Rock’s eligible shareholders (those on the share register on the record date of 5pm, Wednesday 10 September
2014) with one option (New Option, in the same class as Chatham Rock’s listed CRPOB options) to be granted for every New Share allotted (the Offer).
Pursuant to clause 17(1)(a) of Schedule 1 of the Financial Markets Conduct (Phase 1) Regulations 2014 (Regulations) and clause 19 of Schedule 1 of the Financial Markets Conduct Act 2013 (FMCA), Chatham Rock advises that:
1. The Offer is being made in reliance upon the exclusion in clause 19 of Schedule 1 of the FMCA and Chatham Rock is
giving this notice (Cleansing Notice) under clause 17(1)(a) of Schedule 1 of the Regulations.
2. As at the date of this Cleansing Notice, Chatham Rock is in compliance with:
(a) the continuous disclosure obligations that apply to it in relation to Chatham Rock listed shares and options; and
(b) its “financial reporting obligations” within the meaning set out in clause 17(4)
of Schedule 1 of the Regulations.
3. As at the date of this Cleansing Notice, there is no information that is “excluded information” within the meaning
set out in clause 17(4) of Schedule 1 of the Regulations, other than:
(a) as announced to the market, the filed Marine Consent and all applicable documents available at:http://www.epa.govt.nz/EEZ/chatham_rock_phosphate/Pages/default.aspx; and
(b) Chatham Rock has been in discussions with a publically quoted company with respect to a potential merger
transaction. These discussions are at an early stage, on-going and at present no agreement has been reached - binding or
non-binding - on the terms of such a transaction. Should these discussions progress to a documented stage a market
announcement will be made giving further details.
4. The potential effects that the Offer and the issue of New Shares and New Options will have on the “control” (within
the meaning of clause 48 of Schedule 1 of the FMCA) of Chatham Rock and the consequences of those effects are as
follows:
(a) As at the date of this Cleansing Notice, the substantial security holders in Chatham Rock are Subsea Investments II
LLC, Boskalis Offshore Subsea Contracting B.V, Odyssey Marine Exploration Incorporated and Aorere Resources Limited.
(b) If all eligible shareholders take up their pro-rata entitlements to New Shares and New Options under the Offer,
their percentage shareholding in Chatham Rock will remain the same and there will be no effect on the control of Chatham
Rock (provided that the entitlements of any ineligible shareholders are taken up by parties not having the pre-Offer
capacity to exercise “control”).
(c) In some cases, shareholders with registered addresses outside of New Zealand and Australia may not be eligible to
participate in the Offer (and their percentage shareholding will be diluted as a result of the issue of New Shares and
New Options), due to the legal requirements of the relevant jurisdiction being unduly onerous for Chatham Rock to make
the Offer in that jurisdiction (as provided for in NZAX Listing Rule 7.4.3(h)). However, Chatham Rock does not
anticipate that the combined percentage interest of any ineligible shareholders is not likely to be sufficiently
significant for its dilution to have a material effect on the control of Chatham Rock if all eligible shareholders take
up their entitlements.
(d) If some eligible shareholders do not take up their full entitlement, such shareholders' percentage shareholding will
be reduced (relative to those who did take up their full entitlement), and Chatham Rock will be entitled to allocate
that Shortfall to other parties who have taken up their full entitlement under the oversubscription facility.
(e) In addition, if there is a Shortfall under the Offer (following any applications for additional New Shares and
Options, as described above), Chatham Rock will be entitled to place the Shortfall to any persons (subject to complying
with applicable legislative instruments and the NZX Listing Rules) within three (3) months of the Offer closing.
(f) The New Options will not carry voting rights and will only impact upon control if and when they are exercised into
ordinary shares.
(g) Accordingly, the Offer is not expected to have any material effect or consequence on the control of Chatham Rock.
On behalf of the Board,
Chris Castle
Chief Executive Officer