Scheme Portal

A scheme of arrangement is a statutory arrangement facilitated by Part 5.1 of the Corporations Act between a company and its shareholders.

Schemes are commonly used to effect the acquisition of shares in a target company.

Schemes must be approved by a Requisite Majority of shareholders and the Court in order to become binding on the target company’s shareholders.

OPC Shareholders are being asked to consider the proposed scheme of arrangement under which it is proposed that Uniti will acquire 100% of the outstanding shares in OptiComm, in return for which each Scheme Shareholder will receive the Scheme Consideration.

The Scheme requires approval by the Requisite Majority of OPC Shareholders at the Scheme Meeting, approval by the Court at the Second Court Hearing, and lodgement of a copy of the Court orders with ASIC, in order to become Effective.

A copy of the Scheme is contained in Annexure C.

The Scheme Implementation Deed contains various undertakings by OptiComm and Uniti to pursue and progress the Scheme.  The key terms of the Scheme Implementation Deed are summarised in Section 4.14.

The Scheme Implementation Deed is binding on OptiComm only and not on OPC Shareholders.  The Scheme will only become binding on OPC Shareholders if and when the Scheme becomes Effective, which will only occur if the Scheme is approved by the Requisite Majority of OPC Shareholders at the Scheme Meeting, approved by the Court at the Second Court Hearing and a copy of the Court orders are lodged with ASIC.

The OptiComm Directors unanimously recommend that OPC Shareholders vote favour of the Scheme, in the absence of a Superior Proposal.

OPC Shareholders should read this Scheme Booklet carefully and in its entirety.  OPC Shareholders may also choose to consult independent legal, investment, tax or other professional advisers in relation to any of the information contained in this Scheme Booklet.

Based on this Scheme Booklet and any independent advice you may receive, you should determine how you wish to vote on the Scheme.  You are not obliged to follow the recommendation of the OptiComm Directors or the Independent Expert.

You are able to vote by attending the virtual Scheme Meeting, or by appointing a proxy, attorney or, in the case of corporate OPC Shareholders, a corporate representative, to vote on your behalf.

Please refer to Section 4.4 and Annexure E for further information on how to vote on the Scheme.

Persons who hold OPC Shares on the Scheme Record Date can participate in the Scheme.

No brokerage fees will be payable on the transfer of OPC Shares to Uniti under the Scheme.

The OptiComm Directors unanimously recommend that OPC Shareholders vote in favour of the Scheme, in the absence of a Superior Proposal.

Each OptiComm Director also will vote any OPC Shares owned or Controlled by them in favour of the Scheme at the Scheme Meeting, in the absence of a Superior Proposal.

In relation to the recommendations of Allan Brackin, David Redfern, Paul Cross and Ken Ogden (Escrowed Directors), OPC Shareholders should have regard to the fact that, if the Scheme is implemented, the Escrowed Directors will be released from their voluntary escrow agreements with OptiComm and will be able to make an Election in respect of their OPC Shares that are currently subject to a voluntary escrow restriction. The OPC Board consider that, despite these arrangements, it is appropriate for the Escrowed Directors to make a recommendation on the Scheme.

Specifically, in relation to the recommendation of Paul Cross, OPC Shareholders should also have regard to the fact that, if the Scheme is implemented, Mr Cross will become entitled to early vesting of unvested OptiComm Performance Rights. The OptiComm Board (excluding Mr Cross)¹ exercised its discretion to give effect to these arrangements in accordance with the terms of the OptiComm Incentive Plan. OPC Shareholders should have regard to these arrangements when considering Mr Cross’ recommendation on the Scheme, which appears throughout this Scheme Booklet. Mr Cross considers that, despite these arrangements, it is appropriate for him to make a recommendation on the Scheme.

See Sections 10.1 and 10.2 with relation to the interests of OptiComm Directors.

¹ The exercise of discretion by the OptiComm Board was approved by the Non-Executive OptiComm Directors. Paul Cross did not vote on the resolution given his interest in the subject matter of the resolution.

The OptiComm Directors have engaged Lonergan Edwards & Associates Limited to provide an Independent Expert's Report on the Scheme.

[The Independent Expert has concluded that the Scheme is fair and reasonable, and in the best interests of OPC Shareholders, in the absence of a Superior Proposal.]

The OptiComm Directors are of the view that the Scheme is more likely to enhance OPC Shareholder value in the long term than the other currently available alternatives including maintenance of the status quo.

Having regard to the reasons to vote in favour or not vote in favour, other key considerations and risks as set out in Section 9, and the opportunity for both OptiComm and OPC Shareholders to realise the future growth of OptiComm and its various businesses, the OptiComm Directors unanimously recommend that OPC Shareholders vote in favour of the Scheme, in the absence of a Superior Proposal.

The OptiComm Directors unanimously recommend that you vote in favour of the Scheme, in the absence of a Superior Proposal.
Reasons why you should consider voting in favour of the Scheme include:

• The implied value of the Scheme Consideration represents a premium over the trading prices of OptiComm Shares prior to announcement of the Scheme.
• The Scheme Consideration represents an attractive intrinsic value for OPC Shareholders.
• ‘Mix and match’ consideration available under the Scheme allows flexibility for existing OPC Shareholders.
• Potential to receive certainty of value via cash consideration.
• The Scheme will create a growing, large-scale Australian national fibre challenger
• The Combined Group is expected to have significant synergy potential.
• The Independent Expert has concluded that the Scheme is fair and reasonable and in the best interests of OptiComm shareholders in the absence of a Superior Proposal.
• OptiComm’s share price may fall in the near future should the Scheme not be Implemented and in the absence of a Superior Proposal.
• No brokerage or stamp duty will be payable by you for the transfer of your OptiComm Shares under the Scheme.

Further detail is provided in Section 3.1.

Reasons why you might consider voting against the Scheme include:

• You may disagree with the OptiComm Directors’ unanimous decision and the Independent Expert in relation to the Scheme being in your best interests.
• You may prefer to maintain an interest in a publicly listed investment with characteristics entirely specific to OptiComm.
• If the Scheme is implemented, OPC Shareholders who Elect to receive the All Cash Consideration Option (and are not scaled back) will not have ownership in the Combined Group and will forego the opportunity to receive continued benefits from ongoing growth initiatives.
• There are risks associated with the integration of OptiComm and Uniti that you may consider exceed the anticipated benefits of the Scheme.
• You may hold the view that a Superior Proposal could be made in the foreseeable future.
• You may consider that the conditions to which the Scheme may be subject to are unacceptable.
• The value of the Scheme Consideration may vary, depending on the price at which the New Uniti Shares trade on the ASX following the Implementation Date.
• Uncertainty associated with the Consideration Options.

Further detail is provided in Section 3.2.

If the Scheme is approved and becomes Effective, and you are a Scheme Shareholder (other than an Ineligible Foreign Shareholder), you will receive either:

• 3.4228 New Uniti Shares for each OPC Shares; or
• $5.10 for each OPC Share; or
• if you so elect or by virtue of the Scaleback Mechanisms, a combination of cash and New UWL Shares.

As a Scheme Shareholder, you will receive Mixed Consideration Option 1 (subject to the Scaleback Mechanisms) unless you make an Election otherwise prior to the Election Date.

Uniti has offered to make a maximum amount of $406,751,755.80 in cash (Aggregate Cash Consideration) available to pay OPC Shareholders who make an Election to receive a Consideration Option with a cash component (or who receive cash due to the Scaleback Mechanisms).

Uniti has offered to make a maximum amount of 83,996,233 New UWL Shares (Aggregate Scrip Consideration) available to issue to OPC Shareholders who make an Election to receive a Consideration Option with a scrip component (or who receive scrip due to the Scaleback Mechanisms).

OPC Shareholders will receive the proportion of cash and scrip that they make an Election for under the Consideration Options, unless the aggregate cash elected by OPC Shareholders exceeds the Aggregate Cash Consideration or the aggregate scrip elected by OPC Shareholders exceeds the Aggregate Scrip Consideration. In each case, the amount of cash or scrip an OPC Shareholder will receive will be scaled back on a pro-rata basis./p>

You can make an Election to receive a Consideration Option by completing the enclosed Election Form and returning it to the OPC Share Registry by the Election Date.  Once made, you may withdraw your Election at any time until the Election Date.

Yes. The Election you make will apply to all OPC Shares that you hold as at the Record Date.  If you acquire additional OPC Shares after you receive this Scheme Booklet and you hold these OPC Shares on the Record Date, any Election you make will apply to those additional OPC Shares you have acquired.

Yes, so long as Elections relate to the entire underlying beneficial holding.  You should contact the OPC Share Registry to obtain the necessary form to do this.

If you do not make an Election, an Election is invalid, or the OPC Share Registry receives your Election after the Election Date, you will receive the Mixed Consideration Option 1 (subject to the Scaleback Mechanism) as your Scheme Consideration for all of your OPC Shares.

OptiComm will announce a summary of the Elections as soon as possible after the Election Date to ASX and on OptiComm’s website.

An OPC Shareholder whose address is shown in the OptiComm Share Register at 7.00pm on the Scheme Record Date is a place outside Australia and its external territories will be classified as an Ineligible Foreign Shareholder, unless Uniti determines that it is lawful and not unduly onerous or impracticable to issue that OPC Shareholder New UWL Shares when the Scheme becomes Effective.

If you are an Ineligible Foreign Shareholder and you make an Election to receive a Consideration Option with a scrip component, your Election will be invalid and have no effect, and you will receive the All Cash Consideration for all your OPC Shares if the Scheme becomes Effective.

No. If the Scheme becomes Effective, Uniti will acquire 100% of OPC Shares (including yours). Instead, you will receive the Scheme Consideration.

Provided that the Scheme Resolution is passed by the Requisite Majority of OPC Shareholders at the Scheme Meeting, the Scheme is approved by the Court at the Second Court Hearing and the Scheme becomes Effective, this will occur even if you did not vote on the Scheme or if you voted against the Scheme Resolution.

Yes, you can sell your OPC Shares on the ASX at any time before the close of trading on the Effective Date.

Trading in OPC Shares will be suspended from official quotation on the ASX from the close of trading on the Effective Date.   You will not be able to sell your OPC Shares on the ASX after this time.

If you sell your OptiComm Shares on the ASX prior to the Effective Date:

• you will not receive the Scheme Consideration;
• you will not receive the Special Dividend;
• you may be required to pay brokerage on the sale of your OptiComm Shares; and
• there may be different tax consequences for you compared with those consequences that would apply if you disposed of your OptiComm Shares under the Scheme.

The cash component of the Scheme Consideration will be paid on the Implementation Date and New UWL Shares will be issued on the Implementation Date.

Trading on ASX of New UWL Shares issued as part of the Scheme Consideration is expected to commence on a deferred settlement basis on [Tuesday, 22 September 2020].  It is the responsibility of each holder of New UWL Shares to confirm their holding before trading in New UWL Shares.

Trading on ASX of New UWL Shares on a normal settlement basis is expected to commence on [Thursday, 1 October 2020].

No. There is no option for OPC Shareholders to elect to receive or to subscribe for additional New UWL Shares under the Scheme.
OPC Shareholders can purchase additional UWL Shares through normal trading on the ASX.

The Special Dividend is a fully franked cash special dividend which the OptiComm Board intends to resolve to pay prior to implementation, subject to the Scheme becoming Effective, for the benefit of OPC Shareholders who hold OPC Shares at the Special Dividend Record Date.

Subject to the Scheme becoming Effective and the OptiComm Board resolving to pay the Special Dividend (which the OptiComm Board intends to do once the Scheme has become Effective), it will be paid to each OPC Shareholder who holds OPC Shares at the Special Dividend Record Date by:

• direct credit to the nominated bank account of the OPC Shareholder as noted on the OptiComm Share Register on the Special Dividend Record Date; or
• where an account has not been provided, by dispatching a cheque by mail to the OPC Shareholder’s Registered Address as at the Special Dividend Record Date.

The Scheme Meeting is a meeting of OPC Shareholders to consider the Scheme.

The terms of the Scheme Resolution to be considered at the Scheme Meeting are contained in the Notice of Scheme Meeting in Annexure E.

OPC Shareholders who are registered on the OptiComm Share Register at [7:00pm] on [Tuesday, 8 September 2020] will be entitled to vote at the Scheme Meeting.

The Scheme Meeting is scheduled to be held at [11:00am] on [Thursday, 10 September 2020].

In response to the global COVID-19 pandemic and government restrictions on physical gatherings, the Scheme Meeting will be held as a virtual meeting.

OPC Shareholders wishing to vote, or their attorneys or in the case of an OPC Shareholder or proxy which is a corporation, corporate representatives, can participate in the virtual Scheme Meeting by logging in online at https://www.linkmarketservices.com.au/

Note, if you have appointed a proxy and subsequently wish to attend the meeting yourself, the proxy will retain your vote and you will be unable to vote yourself unless you have notified the registrar of the revocation of your proxy appointment before the commencement of the meeting.

There will be no physical meeting where OPC Shareholders and proxies can attend in person.

If you would like to vote but cannot participate in the virtual Scheme Meeting, you can vote by:

• submitting your proxy online at www.linkmarketservices.com.au and following the instructions in the enclosed Proxy Form. You will require the information on your Proxy Form to lodge your Proxy Form through the website;
• by mailing a completed Proxy Form to the OptiComm Registry at Link Market Services Limited Locked Bag A14, Sydney South NSW 1235;
• appointing an attorney to participate in the virtual Scheme Meeting and vote on your behalf; or

appointing a corporate representative if that option is applicable to you.

For the Scheme to proceed, the Scheme Resolution must be approved by the Requisite Majority of OPC Shareholders present and voting at the Scheme Meeting (online or by proxy, attorney or, in the case of corporate OPC Shareholders, corporate representative), which is:

• a majority in number (more than 50%) of OPC Shareholders; and
• at least 75% of the total number of votes cast on the Scheme Resolution at the Scheme Meeting by OPC Shareholders.

The Court has the discretion to waive the first of these two requirements if it considers it appropriate to do so.

If you do not vote or vote against the Scheme Resolution, but the Scheme Resolution is approved by the Requisite Majority of OPC Shareholders, then, subject to the other Conditions Precedent to the Scheme being satisfied or waived, and Court approval, the Scheme will become Effective and binding on all OPC Shareholders, including those who did not vote or voted against the Scheme Resolution.  This will see all OPC Shares (regardless of vote) exchanged for each OPC Shareholder’s Scheme Consideration.

The result of the Scheme Meeting will be announced to the ASX shortly after the conclusion of the Scheme Meeting.  The result will be accessible from the ASX’s website at www.asx.com.au

Even if the Scheme Resolution is passed by the Requisite Majority of OPC Shareholders at the Scheme Meeting, the Scheme will not become Effective unless and until it is approved by the Court at the Second Court Hearing and the Court order is lodged with ASIC.

A summary of the general Australian income tax, stamp duty and GST consequences for OPC Shareholders who participate in the Scheme and receive the Special Dividend is set out in Section 8.

Each OPC Shareholder’s tax position will depend on their particular circumstances.  OPC Shareholders are urged to consult their own professional tax advisers as to the specific tax consequences to them of the Scheme, including the applicability and effect of income tax and other tax laws in their particular circumstances.

Australian resident OPC Shareholders who would otherwise make a capital gain on the disposal of their OPC Shares under the Scheme should be eligible to choose scrip-for-scrip roll-over relief.

The tax consequences of the Scheme will differ for each OPC Shareholder and OPC Shareholders should consult their own professional tax advisers to seek advice that considers their individual circumstances.

As at the date of this Scheme Booklet, the outstanding Conditions Precedent which must be satisfied or waived (as applicable) before the Scheme can become Effective include:

• OPC Shareholder Approval of the Scheme at the Scheme Meeting;
• Court approval of the Scheme;
• there being no action by any court or Government Agency which restrains, prohibits, or otherwise materially adversely impacts upon, the Scheme;
• there being no Uniti Prescribed Occurrence, Uniti Regulated Event, or Uniti Material Adverse Change;
• there being no OptiComm Prescribed Occurrence, OptiComm Regulated Event, or OptiComm Material Adverse Change; and
• the Uniti Warranties and OptiComm Warranties remaining true and correct in all material respects;

Further details regarding the Conditions Precedent are available at Section 4.14(a).

If the Conditions Precedent are satisfied or waived (as applicable) and the Scheme is approved by the Requisite Majority of OPC Shareholders at the Scheme Meeting, OptiComm will apply to the Court to approve the Scheme at the Second Court Hearing.

The Scheme will become Effective on the date on which the Court order approving the Scheme is lodged with ASIC. The Scheme is expected to become Effective by the Business Day following the Second Court Date.

If the Scheme does not become Effective and is not Implemented:

• you will not receive the Scheme Consideration;
• you will not receive the Special Dividend;
• you will retain your OPC Shares; and
• OptiComm will continue to operate in the ordinary course of business and will continue as a standalone entity listed on the ASX.

Since OptiComm and Uniti entered the Scheme Implementation Deed on [Monday, 15 June 2020] through to the date of this Scheme Booklet, no such Competing Proposal has emerged.

However, if a Competing Proposal is proposed to the OptiComm Board prior to the Second Court Date, the OptiComm Board will carefully consider the proposal and determine whether it is a Superior Proposal.

Under the Scheme Implementation Deed, OptiComm must notify Uniti of any Competing Proposal and its terms.

Under the Scheme Implementation Deed, OptiComm must pay Uniti a break fee of $5.4 million if certain specified circumstances occur, including:

• any OptiComm Director withdrawing or adversely revising their recommendation or voting intention that OPC Shareholders should vote in favour of the Scheme Resolution; 
• the announcement or making of a Competing Proposal by a third party during the Exclusivity Period (which is acted upon within 12 months of announcement); and 
• Uniti terminating the Scheme Implementation Deed due to a material breach of the Scheme Implementation Deed or OptiComm Warranty by OptiComm that results in an OptiComm Material Adverse Change, OptiComm Prescribed Occurrence or an OptiComm Regulated Event, or an OptiComm Material Adverse Change occurs which arose directly as a result of OptiComm’s action (or lack thereof).

Uniti must pay OptiComm a break fee of $5.4 million if:

• Uniti materially breaches the Scheme Implementation Deed, or a Uniti Warranty (causing a Uniti Material Adverse Change); 
• a Uniti Prescribed Occurrence or Uniti Regulated Event occurs; 
• Uniti holds a members meeting in connection with the Scheme and the resolutions are not approved; or 
• a Material Adverse Change occurs arising directly as a result of Uniti’s action (or lack thereof).

No break fee is payable if the Scheme does not proceed solely as a result of the Requisite Majority of OPC Shareholders failing to approve the Scheme at the Scheme Meeting.

See Section 4.14(c) of the Bookelt for a more detailed explanation of the circumstances in which a break fee is payable.

If you have any further questions about this Scheme Booklet or the Scheme, you should:

• Seek independent legal, financial, tax or other professional advice; and
• contact the Shareholder Information Line on +61 3 9024 9503, Monday to Friday between 8.30am to 5.00pm (AEDT).

OptiComm is a listed disclosing entity for the purpose of the Corporations Act and as such is subject to regular reporting and disclosure obligations. Information disclosed to the ASX by OptiComm is available on the ASX’s website at www.asx.com.au or on OptiComm’s website at www.opticomm.net.au

If OPC Shareholders pass the Scheme Resolution at the Scheme Meeting and you wish to oppose the approval of the Scheme, you should lodge a notice of intention to appear at the Second Court Hearing, attend the hearing, and indicate your opposition to the Scheme.