Corporate Reorganisation Process
The Company and Talvivaara Sotkamo applied for corporate reorganisation on 15 November 2013 by filing related applications with the District Court of Espoo, Finland. The District Court of Espoo took the decision to commence a corporate reorganisation process in respect of the Company on 29 November 2013 and in respect of Talvivaara Sotkamo on 17 December 2013. The District Court of Espoo appointed Mr. Pekka Jaatinen, Attorney-at-Law, from Castrèn & Snellman Attorneys to act as the Administrator in respect of the corporate reorganisation of both the Company and Talvivaara Sotkamo. In reorganisation proceedings governed by the Finnish Restructuring of Enterprises Act (47/1993, as amended), both the business operations and the debts of a company may be reorganised and restructured. As a result of such reorganisation, a company can either continue its operations or, if the reorganisation fails, initiate bankruptcy proceedings.
On 13 March 2015, the Administrator of the corporate reorganisation of the Companyt filed the final draft restructuring programme to the District Court of Espoo. The approval of the draft restructuring programme required inter alia express support from the necessary number of creditors. The creditors' voting procedure was completed on 6 May 2015 and the Administrator submitted the voting report on the outcome of the creditors' voting procedure to the District Court of Espoo on 25 May 2015. The Administrator's draft restructuring programme was supported by approximately 97.5 percent of the creditors of unsecured debt participating in the voting. In total, creditors whose receivables represent over 53 percent of all known debts recognized for the purposes of the voting procedure voted in favour of the draft restructuring programme. The requisite support from the creditors set forth in the Restructuring of Enterprises Act for the approval of the draft restructuring programme was thereby obtained.
The Annual General Meeting held on 25 June 2015 authorised the Board of Directors to resolve on the share issue of up to 4,500,000,000 new shares in aggregate in deviation from the pre-emptive subscription rights of the shareholders through one or several share issues to conduct the conversion of the unsecured restructuring debts. The decision made was one of the special conditions set for the confirmation and entry into force of the draft restructuring programme.
The confirmation and entry into force of the draft restructuring programme is still subject to a number of conditions relating to inter alia the business and financing arrangements of the Company.
Despite the reorganisation proceedings, control over the business operations remains with the company except for certain decisions outside the ordinary course of business which require a consent of the Administrator. The basic rule of corporate reorganisation is that during the administration phase and before a reorganisation plan is adopted, the company’s operations are continued in the same manner as before. The Administrator is entitled to participate in meetings of administrative organs of a company and to be heard there. During the reorganisation proceedings the Administrator has participated in most of the Board meetings.
Creditors’ voting procedure for approval of Talvivaara’s draft restructuring programme commences
Talvivaara's supplemented draft restructuring prgramme submitted 13 March 2015
Talvivaara's draft restructuring programmes submitted 30 September 2014