Affidavit · 1 Form 59 Rule 29.02(1)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA Affidavit No. VID 527 of 2016 Federal Court of Australia District Registry: Victoria

1

Form 59

Rule 29.02(1)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Affidavit

No. VID 527 of 2016

Federal Court of Australia

District Registry: Victoria

Division: Corporations List

MARK FRANCIS XAVIER MENTHA, CASSANDRA ELYSIUM MATHEWS, MAR TIN MADDENAND BRYAN WEBSTER IN THEIR CAPACITIES AS JOINT AND SEVERALADMINISTRATORS OF ARRIUM LIMITED (ADMINISTRATORS APPOINT ED) (ACN 004410833) AND OTHERS

Plaintiffs

GSO CAPITAL PARTNERS LP AND OTHERS (ACN 116067602) and OTHER S

Defendants

Affidavit of:

Address:

Occupation:

Date:

Samuel Peter Delaney

Level 17, 8 Chifley, 8-12 Chifley Square NSW 2000

Solicitor

22 August 2016

Contents

Document Details - Paragraph Pagenumber

1 Affidavit of Sam Delaney sworn on 22 August 2016.

Exhibit "SPD1", being copy of a folder of documents

2 referred to in the affidavit of Samuel Peter Delaney swornzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA4 2

22 August 2016

Filed on behalf of (name & role of party) ...Q§Q G?pit.?1p.?r.1Q~r~~p, F.iT~tP.~f~Qcj?rlVFir~tGrq~~~gl?i~?rlt

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. 3440-0097-1779v3 [Version 2 form approved 09/05/2013]

2

I Samuel Peter Delaney of Level 17, 8 Chifley, 8-12 Chifley Square NSW 2000, Solicitor, say on

oath:

1. I am a partner of Corrs Chambers WestgarthzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA(Corrs). I am the solicitor on the record for

the first defendanUfirstcross-claimant in this proceeding, GSa Capital Partners LP

(whom I refer to as "GSO"). I am authorised to make this affidavit on behalf of GSa.

make this affidavit from my own knowledge save where otherwise indicated. I have

practised as a lawyer for approximately 14 years.

2. I swore an affidavit in these proceedings on 15 June 2016.

3. In this affidavit, the second, third and fourth defendants/second, third and fourth cross-

claimants are collectively referred to as thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBABNY Parties.

4. Exhibited to me at the time of swearing this affidavit and marked SPO-1 is a bundle of

documents. In this affidavit I refer to documents by reference to their page numbers in

Exhibit SPO-1.

Procedural background

5. On 26 May 2016, the plaintiffs filed an originating process seeking directions and

declaratory relief in relation to the proper construction of various contracts.

6. On 16 June 2016, the matter was listed for directions before her Honour Justice Davies.

On that occasion, Justice Davies made orders which made provision for, among other

things:

(a) the defendants to file and serve their defence and any cross-claim by 4pm on 19

July 2016;

(b) the plaintiffs to file and serve a reply and their defence to any cross-claim by 4pm

on 2 August 2016;

(c) the parties to file and serve any affidavits (or further affidavits), including any

expert evidence, on which they intend to rely by 4pm 16 August 2016;

(d) the parties to file and serve any affidavits in reply by 4pm on 31 August 2016;

(e) the parties to serve a written outline of submissions not exceeding 10 pages by

4pm on 6 September 2016; and

(f) the proceedings to be set down for hearing on 8 and 9 September 2016.

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3zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

7. On 19 July 2016, GSa served its defence, statement of cross-claim and notice of cross-

claim.

8. On 27 July 2016, the BNY Parties served their defence, statement of cross-claim and

notice of cross-claim.

9. On 28 July 2016, I instructed Ms Laura Robb (a solicitor at Corrs) to send a letter via

email to Arnold Bloch Leibler (ABL), the solicitors for the plaintiffs, which attached an

updated version of Annexure A to the statement of cross-claim filed and served by GSa.

A copy of that correspondence and its attachment appear at pages 1 to 4 of Exhibit

SPD-1.

10. On 29 July 2016 at 1:06pm, I sent a letter to ABL via email which attached copies of

invoices particularised in the cross-claims served by GSa and the BNY Parties and

which had not previously been provided to the first plaintiffs. A copy of that

correspondence (without its attachments) appears at pages 5 to 6 of Exhibit SPD-1.

11. On 29 July 2016 at 1:11pm, I sent a further letter via email to ABL which attached a

proposed Agreed Statement of Principles of the laws of the State of New York

(Statement). A copy of that correspondence and the Statement (but excluding the

cases referred to therein) appears at pages 7 to 15 of Exhibit SPD-1. The principles of

the laws of the State of New York are relevant to the proper construction of one of the

Pledge and Security Agreements that are referred to in the pleadings. As there was

limited time before the 8 September 2016 hearing for the parties to procure expert

evidence on the principles of New York law, I proposed the Statement because I

considered it would efficient for the parties to attempt to deal with questions of New York

law in an agreed fashion. In my letter, I requested that the plaintiffs confirm by 5pm on 4

August 2016 whether they would agree to the joint tender of the Statement. I have not

received a response to my request.

12. On 29 July 2016 at 1:15pm, I sent a further letter to ABL via email which attached a

Notice to Admit. A copy of that correspondence and its attachment appears at pages 16

to 21 of Exhibit SPD-1. As set out in my letter, I asked the plaintiffs to make the

admission contained in the Notice to Admit on the basis that, in my view, it is not

controversial and if made, it would reduce the time required for GSa to prepare its

evidence. I asked ABL for a response to the Notice to Admit by Thursday 4 August

2015, given the constraints of the timetable.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

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13. OnzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA5 August 2016 at 6:03pm I received via email a letter from Ms Genevieve Sexton of

ABL which requested the time sheets and retainer agreements relevant to each of the

invoices specified in Annexure A to GSO's statement of cross-claim. A copy of that

correspondence appears at pages 22 to 23 of Exhibit SPO-1.

14. On or about 6 August 2016, by which date I had not received any response to my letter

of 29 July 2016 proposing the Statement (referred to in paragraph 11 above), GSO

engaged a former United States District Judge in the Southern District of New York to

prepare an expert report on matters of New York law. As at 6 August 2016, the plaintiffs

had not filed or served their defence to GSO's cross-claim. As indicated below, they

were ultimately 8 days' date in doing so.

15. On 9 August 2016 at 7:03pm I received via email a letter from Ms Sexton which again

requested copies of the documents requested under cover of her letter dated 5 August

2016. A copy of that correspondence appears at pages 24 to 25 of Exhibit SPO-1.

16. On 9 August 2016 at 8:34pm I received a further email from Ms Sexton which attached

a further letter dated 9 August 2016. A copy of that correspondence appears at pages

26 to 27 of Exhibit SPO-1. The letter records, among other things, that the plaintiffs:

(a) expected to be in a position to file and serve, by 10 August 2016, defences to the

cross-claims filed and served by GSO and the BNY Parties; and

(b) proposed to amend their pleadings to include a claim for rectification, and that

proposed amended pleadings would be filed and served as soon as possible.

17. At about this time, I formed the view that it would also be necessary for GSO's New York

law expert to deal with one additional matter relevant to the pleadings served by the

plaintiffs in May 2016, and I was preparing to instruct the expert to deal with that

additional issue. However, as a result of Ms Sexton foreshadowing that the plaintiffs

would amend their pleadings to include a claim for rectification, I considered it

appropriate to delay briefing the expert to deal with that additional issue pending receipt

of amended pleadings. In light of Ms Sexton's amended pleadings advice, I had formed

the view that it may also necessary for GSO to obtain the expert's views on the

principles of rectification (or any equivalent doctrine) under the laws of the State of New

York and rather than dealing with matters in a piecemeal fashion, I wanted to put all

remaining questions to the expert in one go.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

3440-0097-1779v3


18. OnzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA10 August 2016, the plaintiffs filed and served defences to the cross-claims filed and

served by GSa and the BNY Parties. The defences were served under cover of a letter

dated 10 August 2016 from Ms Sexton confirming that the plaintiffs proposed to amend

their statement of claim and originating process.

19. On 10 August 2016, I instructed Ms Robb to send a letter to ABL in relation to the

plaintiffs' request for time sheets and retainer agreements which stated that we were in

the process of collating those documents and, subject to our client's instructions,

expected to be in a position to produce them during the course of Friday, 12 August

2016. A copy of that letter appears at page 28 of Exhibit SPO-1.

20. On 12 August 2016, I instructed Ms Robb to send a further letter to ABL which stated

that we were continuing to collate the documents requested by the plaintiffs and, as

matters then stood, expected to be in a position to produce them during the course of

the weekend or early the following week. A copy of that letter appears at page 29 of

Exhibit SPO-1.

21. On 12 August 2016, I received a letter from ABL which advised that the plaintiffs would

not make the admission requested in the Notice to Admit, and attached a Notice of

Dispute. Copies of that letter and its attachment appear at pages 30 to 34 of Exhibit

SPO-1.

22. On 15 August 2016 at 5: 18pm, I received a letter via email from ABL which attached a

proposed amended originating process and statement of claim. A copy of that

correspondence (without its attachments) appears at pages 35 to 36 of Exhibit SPO-1.

The letter records, among other things, that the plaintiffs proposed to seek orders in

relation to the filing and service of the proposed amended pleadings, and envisaged

that, if such orders were made, consequential orderszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA"providing for limited discovery and

timetabling extensions may need to follow".

23. The proposed amended statement of claim pleaded a claim for rectification and, at

paragraphs 13-16, a new claim by which the plaintiffs allege that one of the second

plaintiffs, Arrium Limited, is not obliged to pay GSa the Work Fee because "GSa did not

confirm to Arrium Limited whether or not the 'GSa Condition' (as defined in c1l2.1 and

2(b) of the Recapitalisation Deed) had been fulfilled by 5pm on the day prior to the 'End

Date' ... in accordance with cl 9(b) of the Recapitalisation Deed" (GSa Condition

Claim). The GSa Condition Claim is an entirely new case and one that has not

previously been advanced in correspondence. If the Court permits the amendmentszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

3440-0097-1779v3

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proposed by the plaintiffs to the statement of claim, I anticipate that GSO's answer to

this new case will be, at least in part, that the requirements ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAcI 9(b) were not engaged.

GSO is also likely to say that it makes no commercial sense and/or would be

unconscionable to construe the Recapitalisation Deed in a way that requires a

'confirmation' that the GSO Condition had not been fulfilled as a condition precedent to

payment of the Work Fee, in circumstances where the two other conditions precedent to

the Recapitalisation (as defined under the Recapitalisation Deed) contained in clause

2(b) of the Recapitalisation Deed had not been fulfilled.

24. If the Court permits the amendments proposed by the plaintiffs to the statement of claim,

I expect that GSO will wish to lead evidence that as at 5pm on the day prior to the End

Date, the Debt Compromise (as defined in the Recapitalisation Deed) had been

unequivocally rejected by the plaintiffs' lenders and Arrium Limited had stopped work on

the Recapitalisation Documents. In order to do so, I anticipate that I will need an

affidavit from someone involved in the negotiation of the Recapitalisation Documents

and I will need discovery of documents and potentially production of documents by third

parties. I explain this in further detail below at paragraph 33 below.

25. Given the nature of the amendments proposed to the plaintiffs' case as at 15 August

2016, it seemed to me and counsel instructed by GSO in this matter, that there was no

realistic way in which the hearing of this matter could proceed on 8-9 September 2016

and that the timetable of the matter would need to be revised in order to accommodate

the plaintiffs' new rectification and GSO condition claims.

26. OnzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA15 August 2016, I was copied on an email from Ms Claire Stubbe of ABL to the

associate to her Honour Justice Davies. A copy of that email appears at page 37 of

Exhibit SPO-1. Among other things, the email recorded that the plaintiffs:

(a) wish to seek orders from the Court in relation to the filing and service of an

amended originating process, an amended statement of claim and an amended

defence to the GSO cross-claim; and

(b) envisaged that, if the orders sought were made, it may also be necessary to seek

consequential orderszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA"for limited discovery and for an extension of the remaining

timetable and the hearing of the proceeding".

27. On 16 August 2016 I telephoned Ms Stubbe of ABL to identify a mutually convenient

time for the matter to be relisted before the Court. GSO was willing and able to appearzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

3440-0097-1779v3

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before the Court on Friday 19 August, but 23 August was the earliest mutually

convenient date for the parties and counsel. On 16 August 2016, her Honour Justice

Davies listed the proceedings for further directions at 10:15am on 23 August 2016.

28. On 18 August 2016, I sent an email to Ms Sexton and Mr Zwier of ABL which, among

other things:

(a) conveyed my view that if the plaintiffs were granted leave to file and serve their

proposed amended pleadings, the trial date of 8 September would need to be

vacated and the interlocutory timetable varied;

(b) pointed out that there was a fundamental difficulty with the plaintiff seeking

declaratory relief and rectification in circumstances where not all parties to the

relevant contracts were before the Court and where GSa does not know whether

those other counterparties are aware of the proceeding, let alone what their

attitude is to the declaratory relief and rectification orders that the plaintiffs seek;

and

(c) asked ABL what steps the plaintiffs proposed to take to address the difficulty

referred to above.

A copy of that email appears at pages 38 to 39 of Exhibit SPD-1.

29. On 19 August 2016 at 6:1Opm,I received a letter from ABL via email which enclosed a

revised proposed amended originating process and amended statement of claim, with

the rectification claim removed. A copy of that correspondence and its attachments

appear at pages 40 to 61 of Exhibit SPO-1. The letter records, among other things,

that:

(a) in view of my position that the proposed rectification claim would materially delay

the timetable and trial of the proceedings, the plaintiffs are no longer pressing

that claim;

(b) in light of that, the difficulty raised in my email of 18 August 2016 (see paragraph

28(b) above) was no longer relevant; and

(c) outlined a proposed timetable to prepare the matter for hearing on 8 and 9

September 2016.

3440-0097-1779v3

8

30. The letter from ABL of 19 August 2016 does not address the difficulty identified in my 18

August email (see paragraph 28(b) above) because the plaintiffs continue to seek

declaratory relief in relation to the proper construction of the Pledge and Security

Agreements without the various parties to that contract being before the Court.

31. The revised proposed amended statement of claim continues to plead the GSO

Condition Claim.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Preparation of evidence and the provision of discovery

32. We have continued to progress the preparation of GSO's lay evidence notwithstanding

the 8 day delay in receiving the plaintiffs' defence to GSO's cross-claim, and the

potential impact on GSO's evidence of the introduction of the rectification claim and the

GSO Condition Claim. Furthermore, progression of the lay evidence and collating the

documents requested by the plaintiff's under cover of ABL's letters of 5 and 9 August

2016 over the past week has been delayed because I have had to consider and give our

client advice on the plaintiffs' new claims, the implications of those claims on the future

conduct of the matter, and then the apparent abandonment of the rectification claim.

The preparation for the directions hearing on 23 August 2016, including the preparation

of this affidavit, has also diverted resources which might otherwise have been deployed

in preparing the matter for trial. However, as at the date of this affidavit, GSO's lay

evidence is well progressed and should be finalised by 31 August 2016 unless the

plaintiffs are permitted to plead the GSO Condition Claim.

33. I do not know precisely how long it will take for GSO to prepare its evidence if the

plaintiffs are permitted to amend their pleadings in the way proposed in the further

amended versions served at 6.1 Opm on Friday 19 August 2016 because it will to some

extent hinge upon the content of any reply that the plaintiffs choose to file in response to

an amended defence from GSO, the content of documents produced by the plaintiffs

and third parties, and our clients' response to the GSO Condition Claim. However, doing

the best I can to give some estimate of timing based on the information available to me

at the time of swearing this affidavit, I think it will take at least two weeks longer to

prepare GSO's affidavit evidence than would otherwise be the case before any

allowance is made for the time required for discovery by the plaintiffs and the issue of

subpoenas and production of documents. I say that because I expect I will need an

affidavit from Rommel Harding-Farrenberg, a Corrs partner with carriage of the legal

negotiation and drafting of the Arrium Recapitalisation Documents (as defined in thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

3440-0097-1779v3


Recapitalisation Deed) and potentially an affidavit from a GSO employee, Mark

Rutledge, who was involved in some relevant commercial discussions in relation to the

Debt Compromise. Mr Rutledge resides in London, which necessarily adds to the

preparation time involved. Those witnesses will need to give evidence regarding the

rejection of the Debt Compromise and the failure by Arrium's lawyers to continue with

the negotiation of the Recapitalisation Documents following the rejection of the Debt

Compromise. I also apprehend I will need to ask the plaintiffs to produce documents

going to the corporate knowledge of Arrium Limited that the Debt Compromise had been

refused by the Compromise Debt Holders and that Arrium Limited did not wish to

continue with the preparation of the Recapitalisation Documents. Depending on the

production given by Arrium in relation to those matters, I may also need to issue a

subpoena to the Compromise Debt Holders (whom I understand based on information

provided to me by Mr Harding- Farrenberg are a syndicate of banks) or some of those

Debt Holders to obtain documents going to the rejection of the Debt Compromise.

34. As indicated above, GSO's expert evidence in this matter will address principles of the

laws of the State of New York which are relevant to the proper construction of one of the

Pledge and Security Agreements referred to in the pleadings. As noted above, I

attempted to deal with this aspect of evidence by way of an agreed Statement and I

have never received a response to my correspondence of 29 July 2016 in which I

suggested that the parties attempt to deal with the question of New York law in an

agreed fashion. In view of the plaintiffs' abandonment of their rectification case on

Friday evening, I have today instructed the expert to address the additional issue so that

his report can be finalised as quickly as possible. At the time of swearing this affidavit, I

have not been able to ascertain the expert's availability over the week ahead. As noted

below, the expert is based in New York. However, the expert has been prompt in his

approach in the past and I expect he will be able to finalise his report within about a

week.

35. GSO's lay and expert witnesses are both located overseas. Its lay witness is located in

London and its expert witness is located in New York. I have not booked flights for those

witnesses to travel to Australia on 8-9 September 2016, although I have indicated that

they need to be available to do so if they are required for cross examination and the

Court will not permit their examination by video-link.

36. On or about 1 August 2016, I caused Ms Shyla Sharma, a solicitor working under my

supervision, to speak with staff at the Federal Court's Melbourne registry regarding

3440-0097-1779v3

10

arrangements for a video-link. I am informed by Ms Sharma and believe that she spoke

with Mr Daniel McNamara on or about 1 August 2016, the Listings Coordinator for

Victoria, who said that the Federal Court has 5 court rooms which have

videoconferencing facilities and that there were no bookings for those facilities for 8-9

September 2016. Mr McNamara said that there was no particular cut-off for arranging a

video link but that arrangements should be made as soon as possible.

37. I have approached this matter on the basis that the appropriate course is to identify

whether any of GSO's witnesses will be required for cross-examination before seeking

directions permitting testimony by video link. Until the plaintiffs' foreshadowed amending

their case to attempt to rectify the contractual arrangements between the parties, I had

intended to attempt to serve GSO's evidence on 16 August 2016 and ask ABL to tell me

immediately whether they would agree for the witnesses to be examined by video-link

before seeking the Court's approval.

38. In their letter to me of Friday 19 August 2016, the plaintiffs' lawyers have proposed

orders which would require:

(a) the plaintiffs to file amended pleadings (including their claim about the 'GSO

Condition' but not the rectification case) by Wednesday 24 August 2016;

(b) GSO to give discovery of the documents requested by Ms Sexton under cover of her

letters dated 5 and 9 August 2016, as well as other documents evidencing the costs

and expenses the subject of GSO's cross-claimzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA(Additional Documents), by

Wednesday 24 August 2016. I discuss the Additional Documents in further detail

below;

(c) GSO to file and serve amended pleadings in response to the plaintiffs' amended

pleadings by Monday 29 August 2016;

(d) GSO to file evidence and serve its evidence by Monday 29 September 2016; and

(e) the plaintiffs serve their evidence by Monday 5 September 2016.

39. As noted above, GSO has previously provided the plaintiffs with copies of the invoices

referred to in its cross-claim and has agreed to provide the plaintiffs with the timesheets

and retainers associated with those invoices (as requested in the letters from Ms Sexton

dated 5 and 9 August 2016). The task of collating those documents has been time

consuming because the advisors who issued those invoices are located variously in thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

3440-0097-1779v3

11

United Kingdom, Canada, the USA, Hong Kong, Luxembourg and various South

American countries. Further, as noted above, resources have been diverted in the past

week to deal with the plaintiff's now abandoned rectification case.

40. Until ABL's letter of 6.1 Opm Friday 19 August 2016, the plaintiffs had not told GSO that it

proposed to seek an order for discovery of the documents that GSO had agreed to

provide or the Additional Documents. The task of giving formal discovery under the

Court Rules will divert resources on this matter which will otherwise be required for the

finalisation of GSO's evidence.

41. The Additional Documents requested by the plaintiffs under cover of ABL's letter of 19

August includezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA"any other documents which record or evidence:

(a) the quantum of each of the costs and expenses [the subject of the cross-claims

served by GSa and the BNY Parties};

(b) the identity of the persons or entities who performed the work referable to each of

the costs and expenses;

(c) the nature, scope and purpose of the work referable to each of the costs and

expenses;

(d) the dates upon which the work referable to each of the costs and expenses was

performed;

(e) the relevant agreements under which each of the costs or expenses was incurred

(namely, the Interim Facility Agreement or the Recapitalisation Deed)".

42. At the time of swearing this affidavit, I do not have instructions in relation to the potential

number of documents captured by the administrators' request for discovery of the

Additional Documents but I expect that I will have some instructions on this point by

tomorrow morning. I am informed by Megan Russell a solicitor employed by Corrs who

has interrogated Corrs' electronic document management system that Corrs holds 8250

electronic files for the period 22 February 2016 to 21 April 2016 most of which are likely

to be responsive to the plaintiffs' request for discovery. I also note that the total fees

claimed in this matter are in excess of $5 million. Corrs' fees comprise less than 20% of

the overall claim. On the basis that the majority of the fees claimed are in respect of

work performed by lawyers in various jurisdictions and given the number of documents

held by Corrs which are likely to be responsive to the plaintiffs' request for discovery, IzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

3440-0097-1779v3

12

anticipate that there may be in excess of 40,000 documents which will need to be

gathered and reviewed for relevance and privilege. I am not in a position to say how

long such an exercise might take, but in my view, the task could take several months.

43. For the reasons explained above, and relying on my experience as a lawyer with 14

years' experience, it is my view that GSa is not in a position to comply with the revised

timetable proposed by the plaintiffs in ABL's letter of 19 August 2016. If the plaintiffs do

not amend their case to include the GSa Condition Claim, I expect that GSa will be in a

position to:

(a) produce, on an informal basis, copies of time sheets and retainer agreements to the

plaintiffs by Friday 26 August 2016; and

(b) file and serve its lay and expert evidence by 31 August 2016.

44. If the plaintiffs were to serve any responsive evidence by 4pm on Monday 5 September

2016 as they propose, my client would have only 2 days to consider that material before

the commencement of the hearing onzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA8 September 2016. I take instructions in relation

to this matter from various instructors located in New York, Singapore, Hong Kong and

London which adds a further degree of difficulty in this matter for my client.

Sworn by the deponent

at Sydney

in New South Wales

on 22 August 2016

Before me:zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAL~ ~~

.......................if~L ..Si~dt~re of deponer{

......................cz4i!J2.Signature of witness

[N8Ff1eand ~u8lifisatiQnsf witAoos]

&it'C\W.

3440-0097 -1779v3

Rule 29.02(8)

Exhibit certificate

No. VID 527 of 2016




MARK FRANCIS XAVIER MENTHA, CASSANDRA ELYSIUM MATHEWS, MARTIN MADDEN

AND BRYAN WEBSTER IN THEIR CAPACITIES AS JOINT AND SEVERAL

ADMINISTRATORS OF ARRIUM LIMITED (ADMINISTRATORS APPOINTED) (ACN 004410

833) AND OTHERS

Plaintiffs

GSO CAPITAL PARTNERS LP AND OTHERS (ACN 116067602) and OTHERS

Defendants

EXHIBIT SPD-1

This is the exhibit marked SPD-1 referred to in the Affidavit of Samuel Peter Delaney sworn

before me on 22 August 2016.

Solicitor

Filed on behalf of

Prepared by

Law firm

Tel

Gsa Capital Partners LP, the First DefendanUFirst Cross-Claimant

Sam Delaney

Corrs Chambers Westgarth

(02) 9210 6500 Fax (02) 92106611

Email [email protected]

Address for service Level 17, 8 Chifley, 8-12 Chifley Square, Sydney, New South Wales, 2000zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

3453-7499-9555v1


Fred Chan zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

From:

Sent:

To:zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Laura Robb

Thursday, 28 July 2016 9:30 AM

'[email protected]'; '[email protected]';

'[email protected]'

'[email protected]'; '[email protected]'; Sam Delaney;

'[email protected]';

'[email protected]'

In the matter of Arrium Ltd (Administrators Appointed)

Annexure A.pdf; Letter dated 28 July 2016.pdf

Cc:

Subject:

A ttachments:

Dear Leon, Justin and David

I attach a letter of today's date and its enclosure.

Regards

I Laura Robb

Senior Associate

[email protected]

Tel +61 292106034Fax +61 2 9210 6611www.corrs.com.au

r: g~~~~ERS 'A f-i WJNNER \ ,_WESTGARTH ~ __),1 Chambers Asia Pacific Awards 2016.,.,,-~ '," ql~ntrser.vice Award ..

·!..iA"1/~ _

Please consider the environment before printing this email.

2zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAOur referenceSPD/lRlGSOC21000-9117533-14

8 Chifley8-12 Chifley Square Sydney NSW 2000

GPO Box 9925 Sydney NSW 2001Tel +61 292106500Fax +61 292106611www.corrs.com.au

CORRSCHAMBERSWESTGARTH

lawyers

Sydney

Melbourne

Brisbane

Perth

28 July 2016

By email

Mr Leon Zwier

Partner

Arnold Bloch Leibler

Level 21,333 Collins Street

MELBOURNE VIC 3000

ContactLauraRobb(02) 9210 6034

Email: [email protected]

PartnerSam Delaney(02) 9210 6598


Dear Mr ZwierzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Mark Francis Xavier Mentha, Cassandra Elysium Mathews,Martin Madden and Bryan Webster in their capacities as jointand several administrators of Arrium Limited (Administrat orsAppointed) (ACN 004410833) & Ors v GSO Capital Partners LP- Federal Court Proceedings No. VID527/2016

We refer to our client's Statement of Cross Claim filed on 19 July 2016.

We have identified an error in Annexure A to the Statement of Cross Claim. The effect of

that error is to overstate our client's claim by approximately US$140,OOO.

We attach an updated version of Annexure A, marked up to show the revisions made to

the previous version. As a result of the amendment to the Annexure A, paragraphs 25(b)

and the corresponding relief claimed in paragraph B of the Statement of Cross Claim will

need to be formally amended. We will attend to this in due course.

Yours faithfully


Sam DelaneyPartner

attachments

3456-2112-4866v1

3

Annexure A - Particulars of the GSO Costs and Expenses

Adjustment for

amounts post 21 April

2016, discount and Balance in USD (using

Date of Amount-on invoice in amounts not claimed Balance after exchange rates shown

Law firm / service provider Invoice # invoice AUD/USD/EUR byGSO adjustment (in AUD) below)

Corrs Chambers Westgarth AUD(Australia) 6765515 30-Apr-16 AUD 1,433,421.29 173,522.10 AUD 1,259,899.19 USD 957,271.40

Stikeman Elliott (Canada) 5431889 29-Mar-16 USD 114,005.97 / / USD 114,005.97

5439389 21-Apr-16 USD 2,205.72 / / USD 2,205.72

5438323 21-Apr-16 USD 23,671.79zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA/ / USD 23,671.79

5438408 21-Apr-16 USD 44,781.33 / / USD 44,781.33

5438409 21-Apr-16 USD 57,807.77 / / USD 57,807.77

5436679 8-Apr-16 USD 11,156.25 / / USD 11,156.25

5457171 6-Jul-16 USD 2,338.39 / / USD 2,338.393400-16- 21-Jul- USD USD

White & Case (UK and US) 022309faft 169faft ~4§,ge~.Q4143,010.23 / / ~4§,geH}4143,010.23

3400-16- 21-Jul-022289faft .1§9faft USD 123,497.50 / / USD 123,497.503400-16- 21-Jul-022319faft 169faft USD 1,222.00 / / USD 1,222.00

- 9faft 9faftzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAl:JSQ ~a2,4Q7.§g -+ -+ l:JSQ ~a2,4Q7.§Q

- 9faft 9faft l:JSQ 4,§~2.QQ -+ -+ l:JSQ 4,§~2.QQ3400-16- 21-Jul- USD USD022329faft 169faft 7§e,de4.49755,432.23 / / 7ae,de4.49755,432.233400-16-00983 8-Apr-16 USD 60,445.60 / / USD 60,445.60

Shook, Hardy & Bacon LLP(Missouri) 1852934 20-Apr-16 USD 53,759.48 / / USD 53,759.48

Carey v Cia Ltda (Chile) 368430 29-Jun-16 USD 660.00 / / USD 660.00

359022 29-Jun-16 USD 15,950.90 / / USD 15,950.90

360922 8-Apr-16 USD 3,761.00 / / USD 3,761.00

3456-3030-0162v1

4


Adjustment for

amounts post 21April

2016,discount and Balance in USD (using

Date of Amount on invoice in amounts not claimed Balance after exchange rates shown

law firm / service provider Invoice # invoice AUD/USD/EUR byGSO adjustment (in AUD) below)

Miranda & Amado (Peru)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAN/A 21-Apr-16 USD 954.82zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAI I USD 954.82

N/A 21-Apr-16 USD 34,339.35 I I USD 34,339.35

N/A 8-Apr-16 USD 4,923.07 I I USD 4,923.07

Kleyr Grasso (Luxernbourq) 40201 21-Apr-16 EUR 22,255.52 I I USD 24,625.73

4006 8-Apr-16 EUR 1,606.50 I I USD 1,777.59

Nardello & Co (Honq Konq) 14835R 8-Apr-16 USD 24,235.56 I I USD 24,235.56

NE-8VN318-

McKinsey & Company, Inc 18608 28-Apr-16 USD 440,000.00 I I USD 440,000.00

Deloitte Touche Tohmatsu 2-1557052 29-Apr-16 AUD 600,000.00 I I USD 455,880.00

Ernst & Younq, LLP I 11-Apr-16 AUD 2,475,360.00 I I USD 1,880,778.53

Hatch Ltd 90563424 4-Apr-16 USD 224,540.57 I I USD 224,540.57

Jacobs Group (Australia) Pty IA104000-

Ltd 002 8-Apr-16 AUD 82,270.99 I I USD 62,509.50

USD

TOTAL 6,666,344.865 525.542.29

TOTAL of AUC invoices AUD 4,417,530.18

USD

TOTAL of USD invoices 2,283,502.102,142.699.53

TOTAL of EUR invoices EUR 23,862.02

AUC to usc exchange rate 0.7598

EUR to USC exchange rate 1.1065

3456-3030-0162v1


Fred Chan

From: zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBASent:

To:

Cc:zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Sam Delaney

Friday, 29 July 2016 1:06 PM

'Leon Zwier'; Justin Vaatstra

Laura Robb ([email protected]); Megan Russell; 'Amarasingham, Tanya';

Goldman, David; Mathas, Mitchell; Morris, James;Jason Salman; Rommel Harding-

Farrenberg ([email protected]); Meagan Grose

In the matter of Arrium Limited (Administrators Appointed) I FCAVID527/2016 IInvoices

Invoices.pdf; Federal Court Proceedings No. VID527-2016 - Letter dated 29 July

2016.pdf

Subject:

A ttachments:

Dear Leon and Justin,

I attach our letter of 29 July 2016 and its attachment.

Regards,

Sam DelaneyPartner

[email protected] +61 292106598Fax +61 292106611www.corrs.com.au- ,. \

'g~~~'~ERSzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA':A W~NNER \ , ,WESTGARTH i~--;)JChambers Asia Pacific Awards 2016L.,W" . ," c~;n~er.Vice Award ' I''''


1

6zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAOur referenceSPD/LRIGSOC21000-9117533-14




lawyers

Sydney

Melbourne

Brisbane

Perth

29 July 2016

By email

Mr Leon Zwier

Partner


Level 21, 333 Collins Street

MELBOURNE VIC 3000

ContactLaura Robb (02) 9210 6034


PartnerSam Delaney (02) 9210 6598


Dear Leon and Justin,zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA


I refer to the invoices which are in turn referred to in Annexure A to our client's cross

claim. I note that some of those invoices have previously been provided to you. I now

attach copies of invoices not previously provided.

Yours faithfully


)(~Sam DelaneyPartner

attachments

3475-8013-0050v1



Subject:zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Sam Delaney


Leon Zwier; Justin Vaatstra

Amarasingham, Tanya; Goldman, David; Laura Robb; Megan Russell; Rommel

Harding-Farrenberg; Jason Salman; Morris, James; Mathas, Mitchell; Meagan Grose

In the matter of Arrium Limited (Administrators Appointed) I FCAVID527/2016 I NY

Law

Letter to ABL dated 29 July 2016 - NY Law.pdf; Agreed Statement - Cases.zip;

3440-4465-9458-v1 - Agreed Statement of Principles re laws of NY(1).pdf

From:

Sent:

To:

Cc:

A ttachments:


I attach our second letter dated 29 July 2016 and its two attachments.

Regards,

Sam Delaney

Partner

[email protected] +61292106598Fax +61 292106611www.corrs.com.au

-~' \'gB~~'~ERS WtNNER \ _.,'

WESTGARTH Chambers ASia Pacific Awards 201"6,_.. , s ,Cllenf'SjjL' . e Award •.,.

I';;, ,. "


1

8zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAOur referenceSPD/LRfGSOC21000-9117533-14


GPO Box 9925 Sydney NSW 2001Tel +61 292106500Fax +61292106611www.corrs.com.au


lawyers

29 July 2016

Sydney

Melbourne

Brisbane

Perth

By email

Mr Leon Zwier and Mr Justin Vaatstra



MELBOURNE VIC 3000

ContactLaura Robb (02) 92106034


PartnerSam Delaney(02) 92106598




We refer to the Pledge and Security Agreement dated 29 February 2016 entered into by,

inter alia, Onesteel Group (US Holdings), Inc and Molycop USA, LLC (the PSA).

The proper law of the PSA is the law of the State of New York. We wish to put before the

Court some evidence of the law of the State of New York insofar as that law concerns

matters of contractual construction. However, with very limited time for either party to

procure expert evidence, ,we suggest that the most efficient approach is for the parties to

tender jointly an agreed memorandum regarding relevant New York law.

Against that background, we attach a Statement ef Agreed Principles of the laws of the

State of New York (the Statement). The Statement describes what we understand to be

uncontroversial principles of contractual interpretation under the law of the State of New

York. We also attach copies of each of the cases identified in the Statement.

Please tell us by 5pm on 4 August 2016 whether your clients will agree to the joint tender

of the Statement. While we have attempted to ensure that the Statement is sufficiently

detailed and uncontroversial, we are open to considering any comments you may have

about it. However, given the limited time available, if you do have comments, we invite you

to provide them to us by 5pm on Tuesday 2 August 2016.

If agreement cannot be reached on the Statement by 5pm on 4 August 2016, our client

proposes to retain a suitably qualified independent expert to give evidence about the laws

of New York.

Given the constraints of the timetable, if your clients will not agree to the tender of an

agreed memorandum, regardless of its content, please tell us immediately.

We look forward to hearing from you.

3468-4488-1666v1

9

29 July 2016

Arnold Bloch LeiblerzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAMark Francis Xavier Mentha, Cassandra Elysium Mathews,Martin Madden and Bryan Webster in their capacities asjoint and several administrators of Arrium limited(Administrators Appointed) (ACN 004410833) & Ors v GSOCapital Partners LP - Federal Court Proceedings No.VID527/2016

Yours faithfully


Sam DelaneyPartner

attachments

3468-4488-1666v1 pagezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA2


In the matter of Arrium Limited (Administrators Appointed)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA& Ors


VIDzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA527/2016

Agreed Statement of Principles regarding the laws of the State of New York

A. Contract Interpretation Under New York Law

Under New York law, courts enforce agreements according to their plain and

unambiguous terms and do not attempt "to add to or vary the writing" where the contract is

unambiguous and complete.Cookv. David Rozenholc& Associates,226 A.D.2d 311, 312 (N.Y.

App. Div. 1996) ("[w]hen an agreement is set forth in a clear,complete document, it should, as a

rule, be enforced according to its terms");Lui v. Park Ridge at Terryville Ass'n.,196 A.D.2d

579,581 (N.Y. App. Div. 1993) ("[a] court should not, under the guise of contract interpretation,

'imply a term which the parties themselves failed to insert'or otherwise rewrite the contract.").

Moreover, "a contractual provision is not ambiguous merelybecause the parties urge different

interpretations of it." LPL Holdings, Inc.v. Pacific Life Ins. Co.,No. 603652/09,2011 N.Y.

Misc. LEXIS 6863, at *10 (N.Y. Sup. Ct. Mar. 3, 2011) ("[a] contract is unambiguous if the

language it uses has a definite and precise meaning, unattended by danger of misconception in

the purport of the [agreement] itself, and concerning whichthere is no reasonable basis for a

difference of opinion.") (quotingPfizer, Inc. v. Stryker Corp.,348 F. Supp. 2d 131, 142

(S.D.N.Y. 2004) (emphasis omitted);Seiden Assocs.v. ANC Holdings, Inc.,959 F.2d. 428, (2d

Cir. 1991) (an ambiguity will not be found "where one party'sview 'strain[s] the contract

language beyond its reasonable and ordinary meaning").

34404465-9458vl 1

11

The issue of whether a contract is ambiguous is determined asa matter of law.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBASee

Diesel Props S.R.L.v. Greystone Bus. Credit II LLC,631 F.3d 42,51 (2d. Cir. 2011). Ambiguity

is "defined in terms of whether a reasonably intelligent person viewing the contract objectively

could interpret the language in more than one way."Topps Co.v. Cadbury Stani S.A.Ie., 526

F.3d 63, 68 (2d Cir. 2008). The "reasonably intelligent person" is deemed to be "cognizant of

the customs, practices, usages and terminology understoodin the particular trade or business."

Sayersv. Rochester Tel. Corp. Supplemental Mgm't Pension Plan,7 F.3d 1091, 1095 (2d Cir.

1993). In general, "[a]mbiguity is to be determined by looking withinthe four comers of the

document and not to outside sources."American Movie Classics Co.v. Time Warner

Entertainment, L.P.,10 Misc. 3d 1062(A) (N.Y. Sup. Ct. 2005). As one New York courtstated,

"[t]he fundamental, neutral precept of contract interpretation is that agreements are construed in

accord with the parties' intent [and that] [t]he best evidence of what parties to a written

agreement intend is what they say in their writing."Kasowitz, Benson, TorreszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA& Friedman, LLP

v. Duane Reade,98 A.D.3d 403, 405-06 (N.Y. App. Div. 2012);Beal Sav. Bankv. Sommer, 865

N.E.2d 1210, 1213 (N.Y. 2007) ("the intention of the partiesmay be gathered from the four

comers of the instrument and should be enforced according toits terms.").

New York law interprets the objective meaning of the words ofa contract, not the

subjective intent of the parties.Summit Health, Inc.v. APS Healthcare Bethesda, Inc.,993 F.

Supp. 2d 379, 390 (S.D.N.Y. 2014) ("Words and phrases are to be given their plain and ordinary

meaning, and New York courts will commonly refer to dictionary definitions in order to

determine that meaning.");Hudson-Port Ewen Assoc., L.P.v. Chien Kuo, 165 A.D.2d 301, 305

(N.Y. App. Div. 1991) ("the express provisions of the contract must prevail over the conclusory

allegations of either party, whose subjective intent is irrelevant."). Also, under New York law,

3440-4465-9458v 1 2

12

courts will not interpret a contract in a way that would render any portion of the contract

superfluous or meaningless.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBASee Wallacev. 600 Partners Co.,205 A.D.2d 202,206 (N.Y. App.

Div. 1994) ("[i]t is a 'cardinal rule of construction' that the court adopt an interpretation that

renders no portion of the contract meaningless.");Green Harbour Homeowners' Assn., Inc.v.

G.H Dev.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA& Constr., Inc.,zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA14 A.D.3d 963, 965 (N.Y. App. Div. 2005) ("[a] contract should be

interpreted in a way which reconciles all its provisions, ifpossible").

With respect to business contracts, the "language of a business contract must be

construed in light of what a businessman would reasonably expect to give or receive."Lama

Holding Co.v. Shearman& Sterling, Bankers Trust Co.,758 F. Supp. 159, 163 (S.D.N.Y. 1991)

(quoting Merrill Lynch Commodities, Inc.v. Richal Shipping Corp.,581 F. Supp. 933, 939

(S.D.N.Y. 1984) (quotations omitted));Hetchkop v. Gundolt Carpet Workroom,841 F. Supp.

113,116-17 (S.D.N.Y. 1994) ("insurance contracts are treated like other business contracts, and

must be construed according to what a businessman would reasonably expect to give or receive,

to perform or suffer, under its terms.") (quotations omitted and citations omitted);see also

Oswegatchie Light& Power Co.v. Niagara Mohawk Power Corp.,8 Misc. 2d 382, 387 (N.Y.

Sup. Ct. 1957) ("[t]he usual rule is that words used in a business contract are to be construed and

interpreted in the light of the understanding of a reasonable business man.").zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

B. Indemnity Agreements

"Indemnity agreements are a special class of contracts thatmake one party responsible

for the obligations of another. Therefore, the law is well established in New York that indemnity

agreements 'are to be strictly construed to avoid reading into it a duty which the parties did not

intend to be assumed.'"Bond Safeguard Ins. Co.v. Forkosh, 33 Misc. 3d 1219(A) (N.Y. Sup.

Ct. 2011);Wisniewskiv. Kings Plaza Shopping Ctr. Of Flatbush Ave., Inc.,279 A.D.2d. 570, 571

3440-4465-9458vl 3

13

(N.Y. App. Div. 2000) (same);zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAHooper Associates, Ltd. v. AGS Computers, Inc.,74 N.Y.2d 487,

(N.Y. 1989) (same). Furthermore, ambiguities in indemnityagreements are construed against

the drafter. Meija v. Trs. Of Net Realty Holding Trust,304 A.D.2d 627, 628 (N.Y. App. Div.

2003) ("[i]ndemnification provisions of a contract must bestrictly construed and any ambiguity

construed against the drafter.");see also McCarthy v. Am. Int'l Group, Inc.,283 F.3d 121, 124

(2d Cir. 2002) (New York law follows "the well-establishedcontra proferentemprinciple which

requires that 'equivocal contract provisions are generally to be construed against the drafter. "');

Landpen Co., L.P. v. Md. Cas. Co.,03 Civ. 3624,2005 U.S. Dist. LEXIS 2145, at *14 (S.D.N.Y.

Feb. 102005) (same). Additionally, New York law will interpret the phrase "arising out of' in

indemnification provisions broadly.Anthousa, Ltd. v. County of Suffolk,No. 11-15298, 2015

N.Y. Misc. LEXIS 4854, at *12-13 (N.Y. Sup. Ct. Dec. 8, 2015) (finding terms in indemnity

provision were "clear and unequivocal" and that "[w]hen a contract utilizes the term 'arising out

of' a broad scope of coverage is intended by the parties.");Mastrogiacomo v. Geoghan,No. 09-

29747, 2012 N.Y. Misc. LEXIS 5509, at *14 (N.Y. Sup. Ct. Nov. 26, 2012) ("[g]enerally, the

phrase 'arising out of' in an indemnification clause is interpreted to be broad and sweeping in its

effect.").

c. Extrinsic Evidence Under New York Law

In general, extrinsic evidence may not be considered to interpret a contract unless the

contract or contract term itself is ambiguous.1 See Marin v. Constitution Realty LLC,42 Misc. 3dzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

1 Note that some New York courts have permitted extrinsic evidence to "determine ambiguity by 'examin[ing] theentire contract and consider[ing] the relation of the parties and the circumstances under which it was executed.'"Dev. Specialists, Inc.v. Peabody Energy Corp. (In re Coudert Brothers),487 B.R. 375, 393 (S.D.N.Y. 2013) ("acourt may consider the factual circumstances surrounding the execution of the contract, because the court's primarypurposein interpreting the agreement is to determine the parties' intentions, and interpreting the contract's terms ina factual vacuum would undermine that goa!.");Toto, Inc. v. Sony Music Entm't,2012 U.S. Dist. LEXIS 57711, at3-4 (S.D.N.Y. Apr. 23, 2012) ("there is substantial supportfor the view that 'evidence of the context in which acontract was executed always is admissible because words, whatever their apparent clarity, take on meaning fromthe circumstances in which they are used."');Aron v. Gillman, 128 N.E.2d 284, 288 (N.Y. 1995) ("it is well settled

3440-4465-9458v 1 4

14

1227(A) (N.Y. Sup. Ct. 2007) (finding agreement "clear and unambiguous" and that "extrinsic

evidence outside the four comers of the document as to what was 'really intended' but was

unstated or misstated is inadmissible to add to or vary the writing, where no ambiguity exists

upon the face of the agreement.");zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAWallace v. 600 Partners Co.,205 AD.2d 202,208 (N.Y. App.

Div. 1994) ("language employed is clear and unambiguous andnot inconsistent with the balance

of the Lease, [and therefore,] extrinsic evidence may not beutilized to contradict the express

terms of the agreement.") (emphasis omitted);MBIA Ins. Corp. v. Countrywide Home Loans,

Inc., No. 602825/08,2013 N.Y. Misc. LEXIS 1818 (N.Y. Sup. Ct. Apr. 29, 2013) ("theCourt

need not resort to extrinsic evidence where the language of the contract is clear and

unambiguous, as it is here.") (emphasis omitted);Community Bank, NA. v. Paul,133 AD.3d

1008, 1009 (N.Y. App. Div. 2015) ("[w]here, as here, there isa complete, unambiguous

agreement, '[e]vidence outside the four comers of the document as to what was really intended

but unstated or misstated is generally inadmissible to add to or vary the writing"') (quoting

w. w.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAW. Assocs. v. Giancontieri,77 N.Y.2d 157, 162 (N.Y. 1990».

A contract is ambiguous where its language is reasonably susceptible of multiple

interpretations. LPL Holdings, Inc.v. Pacific Life Ins. Co., 603652/09,2011 N.Y. Misc. LEXIS

6863, at *10 (N.Y. Sup. Ct. Mar. 3, 2011). When a contract is ambiguous and there is relevant

extrinsic evidence as to the parties' intent, the proper interpretation of the disputed language

becomes a question of fact for the fact finder.See Arrow Commc 'noLabs.V. Pico Prods., 219

AD.2d 859, 860 (N.Y. App. Div. 1995) ("[w]hen the interpretation of an ambiguous contract

depends on extrinsic evidence, it presents a question of fact for a jury."); Selective Ins. Co. of

thatzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAinconstruing the provisions of a contract we should give due consideration to the circumstances surrounding itsexecution, to the purpose of the partiesin making the contract, and, if possible, we should give to the agreement afair and reasonable interpretation");Hotel Credit Card Corp.v. American Express Co.,13 A.D.2d 189, 191(N.Y.App. Div. 1961) ("[P]roof of the circumstances under which the agreements were made and of the negotiationsleading up to the execution of the written instruments may serve to resolve any ambiguities.").

3440-4465-9458v 1 5


Am.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAv. County of Rensselaer,51 Misc. 3d 255, 268 (N.Y. Sup. Ct. 2011) (noting that courts will

consider evidence extrinsic to a contract "as an aid to construction" when terms are ambiguous).

Besides an ambiguity arising from the language of the contract, New York law also

recognizes that a contract may have a "latent ambiguity." A latent ambiguity exists where "the

language employed is clear and intelligible and suggests but a single meaning, but some extrinsic

fact or evidence aliunde creates a necessity for interpretation or a choice among two or more

possible meanings."Chem. Bank N.Y. Trust Co. Dommerich Div.v. Liebman, 50 A.D.2d 492,

501, (N.Y. App. Div. 1976) ("an ambiguity is properly latent... when the equivocality of

expression . . . does not arise from the words themselves, butfrom the ambiguous or obscure

state of extrinsic circumstances to which the words of the instrument refer, and which is

susceptible of explanation by a mere development of extraneous facts without altering or adding

to the written language .... ");Teig v. Suffolk Oral Surgery Assocs.,2 A.D.3d 836, 838 (N.Y.

App. Div. 2003) ("Even where an agreement seems clear on its face, a 'latent ambiguity' may

exist by reason of the ambiguous or obscure state of extrinsic circumstances to which the words

of the instrument refer."). Thus, even if a contract appearsunambiguous on its face, a latent

ambiguity may be exposed through extrinsic evidence which reveals more than one possible

meaning of the contract.See Leather Form S.R.L.v. Knoll, Inc., 205 F. Appx 861, 862 n.1 (2d

Cir. 2006) ("[a] 'latent ambiguity is where you show the words apply equally to two different

things or subject-matters, and then evidence is admissibleto show which of them was the thing

or subject-matter intended.''') (quotingPetrie v. Trustees of Hamilton College,53 N.E. 216

(N.Y. 1899) ("[a] patent ambiguity appears on the face of theinstrument while a latent ambiguity

is raised by evidence, and to create the latter so as to open the contract to parol explanation it

must be established by proof of circumstances known to all the parties.")).

3440-4465-9458vl 6


Fred Chan


Sam Delaney


Leon Zwier; Justin Vaatstra

Amarasingham, Tanya; Goldman, David; Laura Robb; Megan Russell; Rommel

Harding-Farrenberg; Jason Salman; Mathas, Mitchell; Morris, James; Meagan Grose

In the matter of Arrium Limited (Administrators Appointed) I FCAVID527/2016 INotice to Admit

Letter to ABL dated 29 July 2016 - Notice to Admit.pdf; Notice to admit.pdf

From:

Sent:To:Cc:

Attachments:


I attach our third letter dated 29 July 2016 and its attachment.

Regards,

Sam Delaney

Partner

[email protected]

Tel +61 292106598Fax +61 292106611www.corrs.com.au

-'" '"'g2~~'~ERS fA WINNER \ j,

WESTGARTH ~ •• )' Chambers Asia Pacific Awards 201"6", cy;ntser:vice AwardzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA:,,;,r"


17zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAOur referenceSPD/LRIGSOC21000-9117533-14


GPO Box 9925 Sydney NSW 2001Tel +61292106500Fax+61292106611www.corrs.com.au


lawyers

29 July 2016

Sydney

Melbourne

Brisbane

Perth

By email

Mr Leon Zwier and Mr Justin Vaatstra



MELBOURNE VIC 3000

ContactLaura Robb(02) 9210 6034





Mark Francis Xavier Mentha, Cassandra Elysium Mathews,Martin Madden and Bryan Webster in their capacities as jointand several administrators of Arrium Limited (Administrat orsAppointed) (ACN 004410833) zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA& Ors v GSO Capital Partners LP- Federal Court Proceedings No. VID527/2016

I refer to the invoices referred to in Annexure A of our client's cross claim (the

Invoices). As you will appreciate, each of those invoices is addressed to GSO. Under the

arrangements which exist between GSO and the Participants, the Participants are required

to make payment on or otherwise reimburse GSO for expenses which GSO has incurred in

connection with Arrium, including the Invoices. On this basis, BNY Institutional Services

Australia Limited, in its capacity as Agent, seeks payment of a portion of certain of the

Invoices pursuant to the Participants' rights of indemnification under clauses 24 and 26 of

the Interim Finance Agreement.

Given the constraints of the timetable and in the interests of confining evidence to the real

matters in dispute in this matter, we ask your client to accept for the purposes of the

proceedings that the Participants are required to make payment on or otherwise reimburse

GSO for the Invoices. We trust that such an admission is not controversial. If your clients

are unwilling to make the admission requested, our client will need to assemble evidence of

the contractual arrangements which exist between GSO and the Participants. I anticipate

that that exercise will take some time and will ultimately serve only to add unnecessary

documentary material to the tender bundle.

Against that background, I attach a Notice to Admit Facts. Given the constraints of the

timetable, I would be grateful for your response by Thursday 4 August 2016.

Yours faithfully


Sam DelaneyPartner

attachments

3460-3669-1714v1

18

Form 41Rule 22.01

Notice to admit

No. VID 527 of 2016Federal Court of Australia



MARK FRANCIS XAVIER MENTHA, CASSANDRA ELYSIUM MATHEWS, MARTIN

MADDEN AND BRYAN WEBSTER IN THEIR CAPACITIES AS JOINT AND SEVERAL

LIQUIDATORS OF ARRIUM LIMITED (ADMINISTRATORS APPOINTED) (ACN 004410

833) AND OTHERS

First Plaintiffs

ARRIUM LIMITED (ADMINISTRATORS APPOINTED) (ACN 004410833) and OTHERS

Second Plaintiffs

GSO CAPITAL PARTNERS LP AND OTHERS (ACN 116067602) and OTHERS

Respondents

To the First and Second Plaintiffs

The First Respondent requires you to admit, for the purpose of the proceeding only, the truth of

the following facts:

1. The Participants (as defined in the Interim Finance Agreement referred to in paragraph

9(a) of the Statement of Claim in this proceeding) are required to make payment on or

otherwise reimburse GSa Capital Partners LP in respect of the invoices identified in

Annexure A to this notice.

If you dispute the truth of any fact or the authenticity of any document specified in this notice,

you may, within 14 days after service of this notice on you, serve on the First Respondent a

notice of dispute (Form 42).

If you do not serve a notice of dispute on the First Respondent within 14 days, you will

be taken to have admitted the truth of each fact or the authenticity of each document

specified.

3458-6832-9730v1

Filed on behalf of (name & role of party) E!£~_tB_~~p_()Q<:lE:?!'1L_ __

Prepared by (name of person/lawyer) _~~r1}~~lp~1~rgE:?I?Q~y_ __ _.. _ _Law firm (if applicable) _gg_r_~~__gb.?lin!?_~r~YY'~s_tg?r!b._________ _ _

Tel (Q?J~_?1Q_§_?_~.~. _.. .._ ._.__ _.__.__._ ,_.._ , ,."..__Fax .._(Q?l.~.?zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA1Q,~_~1_)_,, ,.."_" _ _Email ._~?!l):.9~!?l_n~.:t@~()_r_r:?_~c:>~_~lJ_.. _ _ _... .., __ ,'_, ,",. , __, , .. ,,'_ , .Address for service 8-12 Chifley Square, Sydney, NSW 2000(include state and postcode)

[Version 2 form approved 09/05/2013)

19zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA2

Date: 29 July 2016zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

- ~f~{-- --- _~nedby-SamuerPeter DelaneySolicitor for the First Respondent

3458-6832-9730v I


Annexure A

Particulars of the GSO Costs and Expenses

Adjustment foramounts post 21 April

Amount on 2016, discount and Balance after Balance in USDLaw firm zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAI service Date of invoice in amounts not claimed adjustment (in (using exchange ratesprovider zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAInvoicezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA# invoice AUD/USD/EUR byGSO AUD) shown below)

Corrs ChambersWestgarth (Australia) 6765515 30-Apr-16 AUD 1,433,421.29 AUD 173,522.10 AUD 1,259,899.19 USD 957,271.40

Stikeman Elliott (Canada) 5431889 29-Mar-16 USD 114,005.97zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAI I USD 114,005.97

5439389 21-Apr-16 USD 2,205.72 I I USD 2,205.72

5438323 21-Apr-16 USD 23,671.79 I I USD 23,671.79

5438408 21-Apr-16 USD 44,781.33 I I USD 44,781.33

5438409 21-Apr-16 USD 57,807.77 I I USD 57,807.77

5436679 8-Apr-16 USD 11,156.25 I I USD 11,156.25

5457171 6-Jul-16 USD 2,338.39 I I USD 2,338.39White & Case (UK andUS) 3400-16-02230 21-Jul-16 USD 143,010.23 I I USD 143,010.23

3400-16-02228 21-Jul-16 USD 123,497.50 I I USD 123,497.50

3400-16-02231 21-Jul-16 USD 1,222.00 I I USD 1,222.00

3400-16-02232 21-Jul-16 USD 755,432.23 I I USD 755,432.23

3400-16-00983 8-Apr-16 USD 60,445.60 I I USD 60,445.60Shook, Hardy & BaconLLP (Missouri) 1852934 20-Apr-16 USD 53,759.48 I I USD 53,759.48

Carey y Cia Uda (Chile) 368430 29-Jun-16 USD 660.00 I I USD 660.00

359022 29-Jun-16 USD 15,950.90 I I USD 15,950.90

360922 8-Apr-16 USD 3,761.00 I I USD 3,761.00

Miranda & Amado (Peru)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAN/A 21-Apr-16 USD 954.82 I I USD 954.82

N/A 21-Apr-16 USD 34,339.35 I I USD 34,339.35

N/A 8-Apr-16 USD 4,923.07 I I USD 4,923.07

3458-6832-9730v1

21


Adjustment for

amounts post 21 AprilAmount on 2016, discount and Balance after Balance in USD

Law firmzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAI service Date of invoice in amounts not claimed adjustment (in (using exchange ratesprovider Invoice # invoice AUD/USD/EUR byGSO AUD) shown below)Kleyr Grasso(Luxembourg) 40201 21-Apr-16 EUR 22,255.52 / / USD 24,625.73

4006 8-Apr-16 EUR 1,606.50 I I USD 1,777.59Nardello & Co (HongKonq) 14835R 8-Apr-16 USD 24,235.56 / I USD 24,235.56

NE-8VN318-McKinsey & Company, Inc 18608 28-Apr-16 USD 440,000.00 / I USD 440,000.00

Deloitte Touche Tohmatsu 2-1557052 29-Apr-16 AUD 600,000.00 / / USD 455,880.00

Ernst & Young, LLP / 11-Apr-16 AUD 2,475,360.00 I I USD 1,880,778.53

Hatch Ltd 90563424 4-Apr-16 USD 224,540.57 I I USD 224,540.57Jacobs Group (Australia)Pty Ltd IA104000-002 8-Apr-16 AUD 82,270.99 I / USD 62,509.50

TOTAL USD 5,525,542.29

TOTAL of AUD invoices

TOTAL of USD invoices

TOTAL of EUR invoices

AUD 4,417,530.18

USD 2,142,699.53

EUR 23,862.02

AUD to USD exchangerateEUR to USD exchangerate

0.7598

1.1065

34S8-6832-9730v I


Fred Chan


To:

Cc:

Subject:

A ttachments:zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Genevieve Sexton <[email protected]>

Friday,S August 2016 6:03 PM

Sam Delaney

Leon Zwier; Laura Robb; Raphael Leibler

Arrium & Gsa

ABL-#5176414-v1-E-let_-_Sam_Delaney_ -_.pdf

Dear Mr Delaney

I refer you to the attached letter.

Regards

Genevieve Sexton 1 Partner

Arnold Bloch Leibler 1Level 21, 333 Collins Street, Melbourne Victoria 3000

T: +61 3922998091 F: +61 399169391

[email protected] 1 www.abl.com.au

Arnold Bloch Leibler acknowledges the traditional owners of country throughout Australia.

------- Disclaimer --------

This email and any attachments are confidential and may contain privilegedinfonnation. If you are not the intended recipient you must not disclose, print, copy or use

this email or any attachments. If you have received this message in error, please notify the sender immediately and delete it from your system.

Arnold Bloch Leibler does not accept liability for any loss or damage (whether direct, indirect, consequential or economic) however caused, and whether by negligence

or otherwise, which may result directly or indirectly from this email or any attachments (including as a result of your failure to scan this email for viruses or as a result of

interference or unauthorised access during communication). In any event, our liability is limited to the cost of re-supplying this communication.

DisclaimerID:AUUYVGHOO0012


Arnold Bloch LeiblerzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Lawyers and Advisers

5 August 2016

ByE-mail Your RefOur Ref GCS LZFile No.

Sam DelaneyCorrs Cambers [email protected]

ContactGenevieveSextonDirect 61 392299809Facsimile61 [email protected]

PartnerLeonZwierDirect 61 [email protected]

Dear Mr Delaney

RE Mark Francis Xavier Mentha, Cassandra Elysium Mathews, MartinMadden and Bryan Webster in their capacities as joint and severaladministrators of Arrium Limited (Administrators appointed) & Ors v GSOCapital Partners LP & Ors - FederalCourt Proceedings No. VID527/2016

I refer to your letter dated 28 July 2016 to Mr Zwier in respect of your client'sStatement of Cross Claim, and the updated Annexure A attached to that letter.

In respect of each of the invoices specified in that Annexure A, please provide tous the time sheets for each invoice, which specify the work undertaken, the

date(s) the work was undertaken and the time and cost for such work.

Please also forward to us the retainer agreements relevant to each invoice.

Yours faithfully

GenevieveSextonPartner

ABU5176414v1

Level 21333 Collins StreetMelbourneVictoria 3000Australia

DX38455Melbournewww.abl.com.au

Telephone61 3 9229 9999Facsimile61 3 9229 9900

MELBOURNE

SYDNEY

PartnersMark M leibler ACHeruyOlanzerAN.JosephBOI'8nsztajnleonZwierPhHipChesl:erRoss A PatersonSlephenlSharpKenneth A GrayKevinFFrawleyMichael N DodgeJane C SheridanLeonie R Thompsonlaven MardirossianJonathan M WenigPaul SokolowskiPaul RubensteinPeter M Seide!Alexl(jngJohn MlcheJBen MahoneySam DollaroJonathan MitnerJohn MengolisnCaroline GouldenMatthew LeesGenevieve SextonJeremyleiblerNalhanBrinerJonathan CaplanJustinVaalstraCHriHardingJames SimpsonSusanna FordTyrone McCarthyTeresaWaroChristine Fleer

Senior litigationCounselRobert J Heathcote

SpecialCoun.. 1lailaOe Melo

SeniorAssoclat..SueKeeBenjamin MalShallNancy CollinsKimberley MacKayAndrea TowsonDanielMcieDamian CuddihyDevidRebbinsKlyslal PolowJeremyt.anzerNen BrydgesGieCariTanya BastickKatharine McPhersonAlbeftOunepuuEmily SimmonsLiamThomsonJasonvenGriekenElyse HiHonAmeliaSmihMeegan GroseBenPodbulYBridgetUttleCharles GardinerVockiBeIlBridgid CoMingBrianna YoungsonRebeccaZwierGavin HammerschlagKaililin LowdenLaraO'RorkeStephanie CampbellClaire StubbeDominic DelanyStephenUoydJonathan Ortner

ConsultantsAllan FelsAO



From:

Sent:To:

Cc:Subject:Attachments:


Tuesday, 9 August 2016 7:03 PM

Sam Delaney

Claire Stubbe; Leon Zwier; Laura Robb

Arrium/GSO

ABL-#5187848-v1-CORRS_LETIER.pdf

Dear Mr Delaney


Regards


Arnold Bloch Leibler 1Level 21, 333 Collins Street, MelbourneVictoria 3000T: +61 3922998091 F: +61 [email protected] www.abl.com.au

Arnold Bloch Leibleracknowledgesthe traditionalownersof country throughoutAustralia.

-------------- Disclaimer-------------This email and any attachmentsare confidentialand may contain privilegedinformation. If you are not the intendedrecipientyou must not disclose,print, copy or usethis email or any attachments. If you have received this message in error, please notify the sender immediatelyand delete it from your system.Arnold Bloch Leibler does not accept liability for any loss or damage (whetherdirect, indirect,consequentialor economic)howevercaused,and whetherby negligenceor otherwise,which may resultdirectly or indirectiyfrom this email or any attachments(includingas a resultof your failure to scan this email for viruses or as a resultofinterferenceor unauthorisedaccess during communication). In any event, our liability is limited to the cost of re-supplyingthis communication.

DisclaimerID:AUUYVGH000012

1




9 August 2016

By E-mail Your RefOur Ref GCS LZFile No.

Sam DelaneyCorrs [email protected]

ContactGenevieveSextonDirect 61 3 9229 9809Facsimile61 [email protected]

PartnerLeon ZwierDirect 61 [email protected]

Dear Mr Delaney

RE Mark Francis Xavier Mentha, Cassandra Elysium Mathews, MartinMadden and Bryan Webster in their capacities as joint and severaladministrators of Arrium Limited (Administrators appointed) & Ors v GSOCapital Partners LP & Ors - FederalCourt Proceedings No. VID527/2016

I refer to your letter dated 28 July 2016 to Mr Zwier in respect of your client'sStatement of Cross Claim, and the updated Annexure A attached to that letter("AnnexureA").

I further refer to our letter to you of 5 August 2016.

We have not yet received copies of the invoices specified in Annexure A, andthe time sheets which form part of those invoices (which specify the workundertaken,the date(s) the work was undertakenand the time and cost for suchwork). We have also not receivedthe retainer letters.

Please note that, if the requested documents are not provided by 10 am onFriday, 12 August 2016, our client proposes to serve a notice to produce inrespectof those documentsunderthezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAFederal Court Rules 2011 (Cth).

Yours faithfully

GenevieveSextonPartner

ABU5187848v1




MELBOURNE

SYONEY

PartnersMalttMleiblerAC

Henry 0 lJInzerAMJoseph BorensztajnLeon ZWierPhHipChesterRoss A PatersonStephen l SharpKenneth A GrayKEtVinFFrawleyMichael N Ood{l8Jane C SheridanLeonie R ThompsonZaven MardirossianJonathan M WenigPaulSokdowsldPaul RubensteinPetatMSeldeiAle><1(j~John MichelBen MahoneySam DollardJonathan MilnerJohn MengoianCaroline GouldenMatthew LeesGenevieve SextonJeremyleiblerNsthsnBrinerJonathan CaplanJustlnVaatstraCliriHardlngJames SimpsonSusanna FordTyroneMGCarthyTeresaWerdCtvistileFleer

SeniorLitigationCounselRobertJHeathCXJte

Special CounHILJii!aDeMeJo

SeniorAuocl_SueKeeBenjamin Mmhsll

Nancy CollinsKimberley MacKayAndrea TowsonDaniel MoteDamian CuddihyDavid RobbinsKrysIBI PellowJeremy LanzerNei BrydgesGiaCariTanyaBaslid<Katharine McPhersooAlbert OullSplJUEmiy SimmonsUamThoI'TlSOllJason van GriekenElyseHitonAme~aSmlhMeagan GroseBen PodburyBridgetUWeCharles GardinerVlckiBeIlBridgid CCM'IingBrianllS YoungsonRebecca ZwlerGavin HarrmerschlagKaiUlinl.aMlon

lanIO'R"""Stephanie CampbellClairestubbaDominic DelanyStephen UoydJonathan Ortner

ConluttantlAllan Fels AO


Fred Chan


To:

Cc:

Subject:



Tuesday, 9 August 2016 8:34 PM

Sam Delaney; [email protected]

Laura Robb; Claire Stubbe; Leon Zwier

Arrium/GSO

ABL-#5187837 -v1-LETTER_-_PLEADINGS.pdf

Gents


Regards


Arnold Bloch Leibler 1Level 21, 333 Collins Street, Melbourne Victoria 3000zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAT: +61 3922998091 F: +61 [email protected] 1 www.abl.com.au

Arnold Bloch Leibler acknowledges the traditional owners of country throughout Australia.

-------------- Disclaimer -------------This email and any attachments are confidential and may contain privileged information. If you are not the intended recipient you must not disclose, print, copy or use


Arnold Bloch Leibler does not accept liability for any loss or damage (whether direct, indirect, consequential or economic) however caused, and whether by negligence

or otherwise, which may result directly or indirectiy from this email or any attachments (including as a result of your failure to scan this email for viruses or as a result of


DisclaimerID:AUUVYGH000012

27Arnold Bloch LeiblerzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA


9 August 2016

By Email

Mr Sam DelaneyCorrs Chambers [email protected]

Your Ref LZ:011900772Our Ref LZFile No. 011900772

ContactGenevieveSextonDirect +61 392299809Facsimile+61 [email protected]

Mr David Goldman

Norton Rose [email protected] Partner

Leon ZwierDirect 61 3 9229 [email protected]

Dear Mr Delaney and Mr Goldman

Mark Francis Xavier Mentha, Cassandra Elysium Mathews, Martin Maddenand Bryan Webster in their capacities as joint and several administratorsof Arrium Limited (administrators appointed) & Ors v GSO CapitalPartners LP & Ors - Federal Court Proceeding No. VID527/2016

We refer to the Orders made by the Honourable Justice Davies in the subjectproceeding on 16 June 2016 regarding the filing and service of our clients'

Reply and Defences to any Cross-Claims.

Our clients are in the process of finalising their Defences to the Statements ofCross-Claim filed by the First Defendant and the Second to Fourth Defendantsrespectively. Our clients expect to be in a position to file and serve thosedocuments tomorrow.

Further, our clients are also proposing to amend their Originating Process andStatement of Claim to include a claim for rectification of the Security Trust Deed.The amended documents will be filed and served as soon as possible.

Yours faithfully

Genevieve SextonPartner

ABU5187837vl




MElBOURNE

SYDNEY

Partnel'lMallt M Leibler ACHeruyDLanzerJiJdJoseph BorensztajnLeon ZwierPhHipChesierRossA PatersonStaphenlShalpKennelhAGrayKevinFFrawleyMichael N DodgeJane C SheridanLeonie R Thompsonlaven MardirossianJonathan MWenigPaul SokolowskiPaul RubensteinPeter M Seidel_KingJohn MichelBen MahoneySam DoIlartfJonathan MilnerJohn Mengo5enCaroline GouldenMatthew LeesGenevieve SextonJeremy LaiblerNathan BrinerJonathan CaplanJustinVaalstraCliriHardingJames SimpsonSusannaFotdTyrone McCarthyTeresaWartiChristine Fleer

SeniorLitigationCounselRobert J Heathcote

Special Coun .. 1lailaDe Melo

SeniorAssociat..Sue KeeBenjamin MarshallNancyCollinsKimberley MacKayAndrea TowsonDaniel MoteDamienCuddihyDavid RobbinsKlyslal PailowJeremy LanzerNeil BrydgesGiaCariTanya Basticl<Katharine McPhersonAlbeftOunapuuEmily SimmonsUamThomsonJason van GriekenElyse HiKonAmeliaSmihMeagan GroseBen Podtiu~BridgellittleCtlarlesGardinerV<kiBeIlBridgidCowlingBrianna YoungsonRebeccaZwierGavin HarrmerschlagKaitilin LowdonLamO'RorkeStephanie CampbellClaire stubbeDemille DelanyStephen UoydJonathan Ortner

ConsultantsAllan FelsAO

Our reference

SPD/LRIGSOC21000-9117533-14zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA28


lawyers



10 August 2016

Sydney

Melbourne

Brisbane

Perth

Mr Leon Zwier/Ms Genevieve Sexton



MELBOURNE VIC 3000

ContactLaura Robb (02) 92106034


PartnerSam Delaney (02) 92106598


Dear Leon and GenevievezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Mark Francis Xavier Mentha, Cassandra Elysium Mathews,Martin Madden and Bryan Webster in their capacities as jointand several administrators of Arrium Limited (Administrat orsAppointed) (ACN 004410 833) & Ors v GSO Capital Partners LP- Federal Court Proceedings No. VID527/2016

We refer to your letters dated 5 August and 9 August 2016 which requested the invoices

specified in updated Annexure A, the time sheets which form part of those invoices, and the

retainer agreements relevant to each invoice.

We note that some of the invoices were provided to your clients under cover of letter dated

13 May 2016 from BTA Australia Limited, and the remaining invoices were provided to your

firm under cover of letter from Corrs dated 29 July 2016.

We are currently in the process of collating time sheets and retainer agreements and will

provide those to you as soon as possible. Subject to our client's instructions, we anticipate

that we will be in a position to produce those documents during the course of Friday, 12

August 2016.

Yours faithfully


Sam DelaneyPartner

3465-1558-3491v1

Our reference

SPD/LR/GSOC21000-9117533-14zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

29CORRSCHAMBERSWESTGARTH

lawyers


GPO Box 9925 Sydney NSW 2001Tel +61 2 92106500Fax +61 2 92106611www.corrs.com.au

Sydney

Melbourne

Brisbane

Perth

12 August 2016

Mr Leon Zwier and Ms Genevieve Sexton



MELBOURNE VIC 3000

ContactLaura Robb (02) 9210 6034




Dear Leon and GenevievezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Mark Francis Xavier Mentha, Cassandra Elysium Mathews,Martin Madden and Bryan Webster in their capacities as jointand several administrators of Arrium Limited (Administrat orsAppointed) (ACN 004410833) zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA& Ors v GSO Capital Partners LP- Federal Court Proceedings No. VID527/2016

We refer to our letter dated 10 August 2016 which indicated that subject to our client's

instructions, we expected to be in a position to provide you with copies of the time sheets

and retainer agreements today.

We are continuing to collate the documents and take instructions from our client. As

matters presently stand, we expect to be in position to provide the documents to you during

the course of the weekend or early next week.

Yours faithfully


;4?J;b- Sam Delaney zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAr Partner

3463-1740-3907v1



lawyers and Advisers

12August 2016

By Post and E-mail Our Ref GCS LZFile No. 011900772

M Sam DelaneyCorrs ChambersWestgarthLevel 17, 8 Chifley8-12 Chifley SquareSydney NSW 2000

ContactGenevieve SextonDirect 61 3 9229 9809Facsimile61 [email protected]

PartnerLeon ZwierDirect 61 [email protected]

Dear Mr Delaney

Mark Francis Xavier Mentha, Cassandra Elysium Mathews, Martin Maddenand Bryan Webster in their capacities as [olnt and several administratorsof Arrium Limited (administrators appointed) & Ors v GSO CapitalPartners LP & Ors - Federal Court Proceeding No. VID527/2016

We refer to your letter dated 29 July 2016 and enclosed Noticeto Admit.

As set out in the Defence to your client's Statement of Cross-Claim, our clientsare not presently in a position to make the admission sought in the Notice toAdmit. That is the case for the following reasons.

1 First, the fact set out in the Notice to Admit suffers from the samedefects as the allegations in paragraphs 25 and 27 of your client'sStatement of Cross Claim, namely, it does not properly particularisethealleged payment or reimbursementswhich are said to be owing to yourclient, nor does it articulate the bases of those alleged payments orreimbursements.

2 Secondly, our clients do not currently have sufficient informationto verifythe accuracy of the fact set out in the Notice to Admit. As explained inour previous correspondence, in order to do so our clients require, inrespect of each invoice, time sheets which specify: the work undertaken;the date on which the work was undertaken; the time and cost for suchwork; and the relevant retainer agreements. It is our understanding,based on recent communications,that you expect to provide us with thatinformation shortly.

3 Thirdly, some of the payments and reimbursementsalleged in the Noticeto Admit are also the subject of claims made by the Second to FourthRespondents in their Statement of Cross-Claim against our clients.Accordingly, and in view of the defects describedzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAabove, our clients arenot properly in a position to make any admissionin that regard.

Once we receive the information set out at paragraph 2 above, our clients willbe better placed to assess their position regarding the matters the subject of theNotice to Admit. In the interim, we enclose, by way of service, our clients'Notice of Dispute.

Level 21333 Collins SireelMelbourneVictoria 3000Auslralia

DX38455 Melbournewww.abl.com.au

Telephone61 392299999Facsimile61 3 9229 9900

MELBOURNE

SYDNEY

Partne~MarkM le'bl9rACHenly D Lanzer AMJoulphBoranszlajnLeool'NiOl'PhlWpCneslclrRossA PeieaonSlepI>eolSlwpI(em&!hA GrayKevin FFrBWIeyMlc:I!aej N 000VeJaneCShoridanLeonie R TltompsonZaven Merdll'06S1an_!hen M w~'oPaI.i_Pevi Rlben&telnPetarMSeidelAloltKiogJotrtMilche4Ben MahoneySamOQlardJonathan MilnerJoMMeogoianCarolina Gou:denM8~hawleesGeoovieveS6xlonJeromyLeibierNalhallBrtnerJona!hanC~n..kJslinVsalslrBCinlHwdngJamooS~Susanoa ForoTyrone McCBr1hvTere.saWsrdChiistineFleer

Senior UtIgallonCounselRobert JHsalhcole

Special CounselLalla08MeIo

Senior ASioclalo9SuoreeBoojamnMalshallNancyCollInsKimberley MacKayAnOO>a T"""""DanielMOIaOalrienCLKkthyOavidRcbbillSKry5lai PellowJellmflanzerNell BrydgesGiaCsnTanya Bs$lickKelhacino McPhel'sonAJbertDllnapuuEmiy SinvnonsUamThomsonJasonvoYlGriekenEIyseHillooAmelia SmithMeaganGroseBeol'<xl><l~BridgolUW,CharIe!GardinerVicklBellBlidgiLlCaNlingOriaM8 YOOngWlRebecca ZoM6(Gavin HanvnorschlagKalLilinlowdcnLareO'RcneStopharr.a GafT¢ellClairaSlubl.JeDominic DelanySlephenIJcyd

JonathanOrtnor

ConSlultantlAlIElo'lFoisAO


M Sam DelaneyCarrs ChambersWestgarth

All our clients' rights are reserved.

Genevieve SextonPartner

Ene

Arnold Bloch LeiblerPage: 2Date: 12 August 2016

32

Form 42Rule 22.02zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

NOTICE OF DISPUTE


District Registry:Victoria

Division: CorporationsList

IN THE MATTER OF ARRIUM LIMITED (ADMINISTRATORS APPOINTED) ACN 004410833 (AND EACH OF THE COMPANIES LISTED IN SCHEDULE 1)

MARK FRANCIS XAVIER MENTHA, CASSANDRA ELYSIUM MATHEWS, MAR TINMADDEN AND BRYAN WEBSTER IN THEIR CAPACITIES AS JOINT AND SEV ERALADMINISTRATORS OF ARRIUM LIMITED (ADMINISTRATORS APPOINT ED) ACN 004410833 (AND EACH OF THE COMPANIES LISTED IN SCHEDULE 1)

First Plaintiffs

ARRIUM LIMITED (ADMINISTRATORS APPOINTED) ACN 004 410 833 ( AND EACH OFTHE COMPANIES LISTED IN SCHEDULE 1)

Second Plaintiffs

- and -

Gsa CAPITAL PARTNERS LP (AND OTHERS AS LISTED IN SCHEDULE 1)

Respondents

To the First Respondent

The First and Second Plaintiffs dispute the truth of the following facts specified in the First

Respondent's Noticeto Admit dated 29 July 2016:

1 The Participants (as defined in the Interim Finance Agreement referred to in

paragraph 9(a) of the Statement of Claim in this proceeding) are required to make

payment on or otherwise reimburse GSa Capital Partners LP in respect of the

invoices identified in Annexure A to the Noticeto Admit.

Filed on behalf of: the First and Second PlaintiffsPrepared by: Leon ZwierLaw firm: ARNOLD BLOCH LEIBLERTel: 92299999 Fax: 92299900 DX 38455 MelbourneEmail: [email protected] for service: Level 21, 333 Collins Street, Melbourne,VIC 3000

Signed by Genevieve SextonzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAARNOLD BLOCH LEIBLER

Lawyers for the First and Second PlaintiffszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

33

2



SCHEDULE 1




IN THE MATTER OF ARRIUM LIMITED (ADMINISTRATORS APPOINTED) ACN 004410

833 (AND EACH OF THE COMPANIES LISTED IN SCHEDULE 1)

First Plaintiffs

Mark Francis Xavier Mentha, Cassandra Elysium Mathew, Martin Madden and Bryan

Webster in their capacities as joint and several administrators of Arrium Limited (CAN 004

410 833) (administrators appointed), Arrium Finance Pty Limited (ACN 093 954 940)

(administrators appointed) and Arrium Iron Ore Holdings Pty Limited (ACN 152 752 844)

(administrators appointed)

Second Plaintiffs

Arrium Limited (ACN 004410 833) (administrators appointed)

Arrium Finance Pty Limited (ACN 093 954 940) (administrators appointed)

Arrium Iron Ore Holdings Pty Limited (ACN 152 752 844) (administrators appointed)

Respondents

GSO Capital Partners LP

First Respondent

BTA Institutional Services Australia Limited (ABN 48 002 916 396)

Second Respondent

BNY Trust Company of Australia Limited (ABN 49 050 294 052)

Third Respondent

BNY Trust Company of CanadaFourth Respondent


Fred Chan


To:

Cc:

Subject:


Claire Stubbe <[email protected]>

Monday, 15 August 2016 5:18 PM

[email protected]; Sam Delaney

Laura Robb; Leon Zwier; Genevieve Sexton

In the matter of Arrium Limited (Administrators Appointed) I FCAVID527/2016

Letter - Corrs Chambers Westgarth and Norton Rose Fulbright - 15 August

2016.pdf; Proposed Amended Statement of Claim.pdf; Proposed Amended

Originating Process.pdf; Proposed Amended Defence to GSO Cross-Claim.pdf

Dear Mr Delaney and Mr Goldman,

Please see the attached letter and enclosures.

Yours sincerely,

Claire Stubbe

Claire Stubbe I Senior Associate

Arnold Bloch Leibler I Level 21, 333 Collins Street, Melboume Victoria 3000

T: +61 392299700 IF: +61 399169539

[email protected] I www.abl.com.au

Arnold Bloch Leibler supports Aboriginal and Torres Strait Islander recognition and the removal of racially discriminatory provisionsin the Constitution.

----------- Disclaimer -----------This email and any attachments are confidential and may contain privileged information. If you are not the intended recipient you must not disclose, print, copy or use


Amold Bloch Leibler does not accept liability for any loss or damage (whether direct, indirect, consequential or economic) however caused, and whether by negligence

or otherwise, which may result directly or indirectly from this email or any attachments (including as a result of your failure to scan this email for viruses or as a result of



36



15 August 2016

By Email

Your Ref LZ:011900772

Our Ref LZ

File No. 011900772

Mr Sam DelaneyCorrs [email protected]

Mr David GoldmanNorton Rose [email protected]

Contact

Genevieve Sexton

Direct +61 392299809

Facsimile +61 399169391

[email protected]

Partner

Leon Zwier

Direct 61 3 9229 9646

[email protected]

Dear Mr Delaneyand Mr Goldman

Mark Francis Xavier Mentha, Cassandra Elysium Mathews, Martin Maddenand Bryan Webster in their capacities as joint and several administratorsof Arrium Limited (administrators appointed) & Ors v GSO CapitalPartners LP & Ors - FederalCourt Proceeding No.VID527/2016

As foreshadowed in our recent correspondence, we enclose copies of thefollowing documentsfor your clients' consideration:

1 proposedAmended Originating Process;

2 proposedAmended Statement of Claim; and

3 proposedAmended Defenceto GSO Cross-Claim.

Our clients propose to seek Orders from the Court in relation to the filing andservice of the above documents. Our clients also envisage that, if such Ordersare made, consequential Orders providing for limited discovery and timetablingextensions may need to follow.

In the circumstances, we propose to contact the Court via email today andrequest that the proceeding be listed before the HonourableJustice Daviesthisweek in order to obtain directions in relation to the above matters. We will copyeach of you to our email correspondencewith the Court in that regard.

In the interim, please advise, by return, whether your respective clients haveany objection to, or otherwise consent to, our clients filing and serving theenclosed proposedamended documents.

Ene

Level 21333 Collins StreetMetbourneVictoria 3000Australia

DX384SSMelbournewww.abl.com.au

Telephone61 392299999Facsimile61 3 9229 9900

MELBOURNE

SYDNEY

Partner1lMOOcMl.eibIorACHervy 0 Lanzer AMJoseph BorenszlaJnleonZwierPtilipChesierRoss A PalElfSOflSl..,..., L ShoopKenneltlAGr?JYI<tWinFFrawleyMichael N Dodge

"'""CSheridanLeOO.R~ZlrYenMardirosslaoJonalhenMWe~gP.~ Sokoo•• ldPaul RLbenMlllnPelerMSeideIAlex KingJohnMitchelBen MehooeySam DoIlaro_!hanMi""John MerlgoiBnCaroIlneGOLtdanManheWL88IGenevi9V9 SaKtorlJoremyLeiblerNalhenBfinorJonathan eapl!lflJu&linVaaletraClint H8IdngJo"",8",-,Suaanna FordTyrone McCarthyT9I1lSaWardCMsUneFIeef

Senior l.ltlgatJonCounselRobertJ H&8thoote

Spacial CounselLatlaDe Malo

SeniorAsaoclatuSuo KeeBooj_Ma..toailNancyCoKinsKIII'berieyMacKayAn<i>a T"""",Danlel~.oIeDarri.enCL.O:jhyDavldRobbln8KI)'stalPoIlow'Jer&mv LanzerNellBoydgeoGieCariTllnyaBlmckKatharine McPtlerronAlbel10lll8pUu

E"'~Si"""'"Uam ThomsonJasonVa1GrieltenEty&eHllonArM. s.;~Meagan GI'O$8BIIdgolUm.Chfl~6SGarQl'I8fVlcki8ellBrI<jg~C<NdngBrillMa YoungsonRececce Z...,Gavin HS/M'I6r5ChlagK81~liolowdonLaraO'f«xkoStepharr.eCampbellCI8119 StubbeOomirk Oa'IIfIYSIep/)enUoydJooalho!!n Ortner

ConllultanltA1lanF88AO





Monday, 15 August 2016 5:39 PM

[email protected]

[email protected]; Leon Zwier; Sam Delaney; Laura Robb;

Genevieve Sexton


From:

Sent:To:Cc:

Dear Associate,

We act for the Plaintiffs and Cross-Respondents in the abovenamed proceeding.

Our clients wish to seek Orders from the Court in relation to the filing and service of an Amended Originating Process,

an Amended Statement of Claim and an Amended Defence to the GSO Cross-Claim.

The solicitors for the other parties to the proceeding are on notice of our clients' position. Further, we have, today,

provided copies of our clients' proposed amended documents to the solicitors for the other parties and requested thatthey confirm whether their respective clients have any objection to, or otherwise consent to, the filing and service ofthose documents. We will inform the Court of the other parties' position once we receive that confirmation.

In addition, our clients also envisage that, if the Orders sought are made, it may also be necessary to seekconsequential Orders for limited discovery and for an extension of the remaining timetable and the hearing of theproceeding.

In those circumstances, our clients kindly request that the proceeding be listed for directions before the HonourableJustice Davies at a time convenient to the Court, if possible this week. In that regard, we confirm that our clients'Counsel are available to appear on Thursday, 18 August 2016.

Please kindly advise, by return, whether the Court is able to accommodate our clients' request.

We confirm that the solicitors for all parties are copied to this email.

Yours sincerely,

Claire Stubbe

Claire Stubbe I SeniorAssociate

Arnold Bloch Leibler I Level 21, 333 Collins Street, MelbourneVictoria 3000T: +61 392299700 IF: +61 [email protected]

Arnold Bloch LeiblersupportsAboriginal and Torres Strait Islanderrecognitionand the removalof raciallydiscriminatoryprovisionsin the Constitution.

-------------- Disclaimer-----------This email and any attachmentsare confidentialand may contain privilegedinformation.If you are not the intendedrecipientyou must not disclose, print, copy or usethis email or any attachments. If you have receivedthis message in error, please notify the sender immediatelyand delete it from your system.Arnold Bloch Leibler does not accept liability for any loss or damage (whetherdirect, indirect,consequentialor economic)howevercaused,and whether by negligenceor otherwise,which may result directly or indirectlyfrom this email or any attachments(includingas a resultof your failure to scan this email for virusesor as a resultofinterferenceor unauthorisedaccess during communication). In any event, our liability is limited to the cost of re-supplyingthis communication.

DisclaimerID:AUUVYGH000012

1


Fred Chan

From:

Sent:To:zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBACc:

Subject:

Sam Delaney

Thursday, 18 August 2016 11:15zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAPMLeon Zwier; 'Claire Stubbe'; Genevieve Sexton

[email protected]; Laura Robb

RE:In the matter of Arrium Limited (Administrators Appointed) I FCAVID527/2016

Dear Genevieve, Claire and Leon,

We refer to your client's draft amended pleadings served on Monday 15 August 2016.

To enable us to seek our client's instructions in relation to the proposed filing of the amended pleadings, pleaserespond to the following matters.

Further and better particulars

The particulars to paragraph 25 of the proposed Amended Statement of Claim refer to "various emails between theparties and their solicitors including, particularly, emails between Ms Rowena White of Herbert Smith Freehills(solicitors for the Arrium Group and the Moly-Cop Security Grantors) and Ms Katy Anderson of Corrs (solicitors for

GSO) dated 20 February 2016" (our emphasis). Please provide us with full particulars of all emails upon which yourclients rely.

Paragraph 26 of the proposed Amended Statement of Claim contains no particulars. Please provide us with fullparticulars of the common intention alleged, including all emails and other communications upon which your clients

rely.

Trial date zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAI revised timetable

In our view, if your clients are granted leave to file the proposed amended pleadings, the trial date of 8 September2016 will need to be vacated and the interlocutory timetable will need be varied. The introduction of a claim forrectification of the Security Trust Deed (STD) would fundamentally change the nature and extent of the trial. Inparticular, the proposed claim would introduce a substantial factual enquiry about the negotiations in relation to the

deed and the common intention of each of the parties to the deed. In our view, the timetable would need to bevaried so as to provide time for:

&#61623&#61623&#61623&#61623&#61623

filing of responsive pleadings;

service of affidavit evidence by your clients;

service of responsive affidavit and expert evidence by the defendants;

discovery; and

a further directions hearing at which the matter might be fixed for hearing.

Please provide us with a proposed revised timetable for our consideration tomorrow.

Joinder of new parties

Whilst the proposed amended statement of claim seeks rectification of the STD, the relevant term which your clientseeks to rectify is incorporated by reference in the Pledge and Security Agreements (PSAs). As such, the proposedclaim in effect seeks rectification of the PSAs. However, your clients are not parties to the PSAs and your clients havenot joined any the Grantors (as defined under the PSAs) as respondents to the proceeding. Further, pursuant to the

Accession Deeds executed by the Grantors, the Grantors have acceded as "Security Providers" to the STD. We donot know if the Grantors are aware of the proceeding, let alone what their attitude is to the declaratory relief andrectification orders that your clients seek.

In our view, there is a fundamental difficulty with your client seeking declarations regarding the meaning of the PSAand orders for the rectification of the STD in circumstances where the Grantors (Security Providers) are not before the

Court. Please tell us what steps your client proposes to take to address this issue.

To the extent that your client proposes to join additional parties to the proceeding, please ensure that an appropriateallowance is made for that joinder in your proposed revised timetable.

1

39zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBARegards,

Sam Delaney

Partner

[email protected] +61292106598Fax +61 292106611www.corrs.com.au

~,WLNNER \.~Chambers Asia Pacific Aw?

, , ~ Clien~r.vice AwardzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA'l.~ "','


From: Claire Stubbe [mailto:[email protected],au]

Sent: Monday, 15 August 2016 5:18 PM

To: Sam Delaney <[email protected]>; [email protected]

Cc: Laura Robb <[email protected]>; Leon Zwier <[email protected]>; Genevieve Sexton

<[email protected]>

Subject: In the matter of Arrium Limited (Administrators Appointed) I FCAVID527/2016



Yours sincerely,

Claire Stubbe


Arnold Bloch Leibler I Level 21, 333 Collins Street, MelbourneVictoria 3000T: +61 392299700 I F: +61 [email protected]

Arnold Bloch LeiblersupportsAboriginal and Torres Strait Islanderrecognitionand the removalof racially discriminatoryprovisionsin the Constitution.

------------- Disclaimer-----------This email and any attachmentsare confidentialand may contain privilegedinformation. If you are not the intended recipientyou must not disclose, print, copy or usethis email or any attachments. If you have receivedthis messagein error, please notify the sender immediatelyand delete it from your system.Arnold Bloch Leibler does not accept liability for any loss or damage (whetherdirect, indirect, consequentialor economic)howevercaused,and whether by negligenceor otherwise,which may result directly or indirectlyfrom this email or any attachments(includingas a resultof your failure to scan this email for viruses or as a resultofinterferenceor unauthorisedaccess during communication), In any event, our liability is limitedto the cost of re-supplyingthis communication,


2



From:

Sent:To:Cc:Subject:Attachments:


Friday, 19 August 2016 6:10 PM

Sam Delaney; [email protected]

Laura Robb; Leon Zwier; Genevieve Sexton


Letter - Corrs Chambers Westgarth and Norton Rose Fulbright - 19 August

2016.pdf; Proposed Amended Originating Process.pdf; Proposed Amended

Statement of Claim.pdf



Yours sincerely,

Claire Stubbe


Arnold Bloch Leibler I Level 21, 333 Collins Street, MelbourneVictoria 3000T: +61 392299700 I F: +61 [email protected] www.abl.com.au

Arnold Bloch LeiblersupportsAboriginal and Torres Strait Islanderrecognitionand the removalof racially discriminatoryprovisionsin the Constitution.

------------ Disclaimer ------------This email and any attachments are confidential and may contain privileged information. If you are not the intended recipient you must not disclose, print, copy or use


Amold Bloch Leibler does not accept liability for any loss or damage (whether direct, indirect, consequential or economic) however caused, and whether by negligence

or otherwise, which may result directly or indirectiy from this email or any attachments (including as a result of your failure to scan this email for viruses or as a result of


DisclaimerID:AUUYVGHOOOOI2

1


Arnold Bloch LeiblerLawyersand Advisers

19 August 2016

By Email Your Ref LZ:011900772Our Ref LZFileNo, 011900772

Mr Sam DelaneyCorrs Chambers Westgarthsam, [email protected],au

Mr David GoldmanNorton Rose Fulbrightdavid,[email protected]

ContactGenevieve SextonDirect +61 392299809Facsimile+61 [email protected],au

PartnerLeon ZwierDirect 61 3 9229 [email protected],au

Dear Mr Delaney and Mr Goldman

Mark Francis Xavier Mentha, Cassandra Elysium Mathews, Martin Maddenand Bryan Webster in their capacities as joint and several administratorsof Arrium Limited (administrators appointed) & Ors v GSO CapitalPartners LP & Ors - Federal Court Proceeding No. VID527/2016

I refer to previous correspondence and, in particular, to the email from MrDelaney sent 18 August 2016 regarding my clients' proposed amendedpleadings.

As you know, it is critical to my clients that this matter be resolved quickly, in thecoming months.

In view of Mr Delaney's clients' position, namely that the proposed rectificationclaim would materially delay the timetable and trial of the proceeding, my clientsare no longer pressing that claim.

To that end, I enclose a copy of my clients' proposed Amended OriginatingProcess and Amended Statement of Claim, with the rectification claim removed,

In those circumstances, my clients intend to seek the following orders at thedirections hearing next Tuesday:

1 By 4:00 pm on Wednesday, 24 August 2016, my clients file and serve anAmended Originating Process, an Amended Statement of Claim and anAmended Defence to the GSO-Cross Claim, substantially in the formenclosed under cover of this letter;

2 By 4:00 pm on Wednesday, 24 August 2016, my clients file an index ofthe documents they intend to reply upon at the trial of the proceeding;

3 By 4:00 pm on Wednesday, 24 August 2016, your respective clientsmake discovery of all documents evidencing the costs and expenses thesubject of your clients' Cross-Claims in the proceeding, including:

(a) all fully itemised invoices in respect of each of the costs andexpenses;

(b) all retainer letters referable to each of the costs and expenses;


DX38455 Melbournewww.abl.com.au


MElBOURNE

SYDNEY

Partnl'"MEIft(MleiblerAC

H""I 0 Lw"AMJooop/IBorooWjnLeonz..ierPhllipChe6I«ROM A PeteoonStephenlSh8lpK_AGI8y

KiMnFF"""yMicllaet N DodgeJeneCSheridaol..,.;, Rfhool>oonzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAlB'IOII M.. droulonJonathan MWOIligPetASoi<Oow1i<iPaulRlbensI.elnPet9l'MSeidelAlex KingJoMMitchelBooM_s.mO<;liWdJonathan ~rf'l8(John MengoianCorotlno GouldenMatthewleeaGeneMevs SextonJer&mylelblerN&thanBrtner-~JuatinV8iis1raCllnlHan:lng

Js""'SiIrf>aooSuaamaFOI'dTyrooeMcC,rthyTerO$llWwCtvlsUneFlear

Senior lItfgationCounselRobertJH98l1'1Co(e

Special CounaalLailaOeMelo

Senior A'toclltelsee xeeBen/arrinMar3hallNancy CoIlnsK_I18'fMocKayAnaooTowsonOaoieiMoIaOarr;",CuddhyIJavidR-.sKrysial PoIlowJeremyl8l\le{NeitBf'/dgoaGiaCBriTanya Baaijck

KathBrineMcPherootlAJbortOt.rrapwEmWySlrrmonsUomThomoarJason van GriekenElyse HiUonAmelia SmilhMeagan GroaeBlid90tUm,Charlas G~lIan&l'Vldr;iBelJBridgidC<JwtjngBrlenna YOOOQSOORabecc8 Z>MerGavin HHrrvnetSC~egKeiWin lowdonl8/'80'RorkeStepl\o.,C.1I'j)bOlcr"reS\LdleDomiric DelanySt_llo'/dJonathan Ortner

ContultantlAllan FelaAO

42

Arnold Bloch LeiblerPage: 2Date: 19August 2016

(c) any other documents which record or evidence:

(i) the quantum of each of the costs and expenses;

(ii) the identity of the persons or entities who performed thework referable to each of the costs and expenses;

(iii) the nature, scope and purpose of the work referable to theeach of the costs and expenses;

(iv) the dates upon which the work referable to each of thecosts and expenses was performed;

(v) the relevant agreements under which each of the costs orexpenses were incurred (namely, the Interim FacilityAgreement or the Recapitalisation Deed).

4 By 4:00 pm on Monday, 29 August 2016, your respective clients file andserve any Amended Defences to my clients' Amended Statement ofClaim.

5 By 4:00 pm on Monday, 29 August 2016, your clients file and serve anyaffidavits, expert evidence and/or lists of documents upon which they

intend to rely at the trial of the proceeding.

6 By 4:00 pm on Monday, 5 September 2016, my clients file and serve anyaffidavits, expert evidence and/or further lists of documents upon whichthey intend to rely at the trial of the proceeding in response to yourclients' respective Cross-Claims.

In view of my clients' position, the issues raised in Mr Delaney's email regardingfurther and better particulars and joinder of new parties are no longer relevant.

Please advise as soon as possible, but in any event by Monday, 22 August2016, whether your respective clients will agree to the above orders and, if not,please confirm what orders they propose to seek at the directions hearing nextTuesday.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

~-----,zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Leon ZwierPartner

Ene


Form 2

Rule 2.2

AMENDED ORIGINATING PROCESS




IN THE MATTER OF ARRIUM LIMITED (ADMINISTRATORS APPOINTED) ACN 004410833 (AND EACH OF THE COMPANIES LISTED IN SCHEDULE 1)

MARK FRANCIS XAVIER MENTHA, CASSANDRA ELYSIUM MATHEWS, MARTINMADDEN AND BRYAN WEBSTER IN THEIR CAPACITIES AS JOINT AND SEVERALADMINISTRATORS OF ARRIUM LIMITED (ADMINISTRATORS APPOINTED) ACN 004410833 (AND EACH OF THE COMPANIES LISTED IN SCHEDULE 1)

First Plaintiffs

ARRIUM LIMITED (ADMINISTRATORS APPOINTED) ACN 004410833 (AND EACH OFTHE COMPANIES LISTED IN SCHEDULE 1)

Second Plaintiffs

- and-

GSO CAPITAL PARTNERS LP (AND OTHERS AS LISTED IN SCHEDULE 1)

Defendants

A. DETAILS OF APPLICATION

This application is made under section 447D(1) of thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBACorporations Act 2001 (Cth) (Act) and

section 21 of the Federal Court of Australia Act 1976 (Cth).

On the facts stated in the supporting affidavit and Statement of Claim annexed thereto, the

Plaintiffs claim:

Filed on behalf of: the PlaintiffsPrepared by: Leon ZwierLaw firm: ARNOLD BLOCH LEIBLERTel: 9229 9999 Fax: 92299900

Ref: 011900694

DX 38455 MelbourneEmail: [email protected] for service: Level 21, 333 Collins Street, Melbourne, VIC 3000zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

ABU4918500v2



Final relief

1 A direction pursuant to s 447D(1) of the Act that the First Plaintiffs, in their capacities

as joint and several voluntary administratorsof the Second Plaintiffs, are justified in

acting on the basis that, on their proper construction,the RecapitalisationDocuments

providethat:

(a) Arrium Limited is not obliged to pay the 'Work Fee' under cl 10 of the

RecapitalisationDeed unless GSa gave the confirmationreferred to in, and in

accordancewith, cI 9(b) of the RecapitalisationDeed;

W!QLany amount payable underaRdor in connectionwith the RecapitalisationDeed

(including~ 'Work Fee' under cl 10 of the RecapitalisationDeed and any

other cost provided for in cI 13 of the Recapitalisation Deed) is not an

indemnified liability under s 8.17 of the PSAs or any other provision of the

PSAs;

(bj~the RecapitalisationDeed is not a 'FinanceDocument'as defined in the STD;

{G)!QLany amounts payable under aRGor in connection with the Recapitalisation

Deed (including ~ 'Work Fee' under cI 10 of the RecapitalisationDeed

and other costs payable under cI 13 of the Recapitalisation Deed) are not

'Secured Money' as defined in the STD; and

{Eij~any amount payable under aAG-o_Linconnection with the Recapitalisation

Deed is an unsecured liability of Arrium Limited (administrators appointed)

(ACN 004410 833) (Arrium Limited) and, for the avoidance of doubt, is not

secured by virtue of the provisionsof the RecapitalisationDocuments,

where:

'Recapitalisation Deed' means the 'RecapitalisationDeed' dated 22 February2016

betweenArrium Limitedand the First Defendant;

'PSAs' means,collectively:

(a) the 'Pledge and Security Agreement' dated 29 February 2016 between

certain of the entities listed in Schedule 2 (Moly-Cop Entities) and the Third

Defendant;and

(b) the 'Pledge and Security Agreement' dated 29 February 2016 between

certain of the Moly-Cop Entities listed in Schedule 2 and the Fourth

Defendant;

45

3

'STD' means the 'Security Trust Deed' dated 21 February 2016 between Arrium

Finance Pty Ltd (administrators appointed) (ACN 093 954 940)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA(Arrium Finance),

and the Second to Fourth Defendants inclusive; and

'Recapitalisation Documents' means, collectively, the Recapitalisation Deed, the

PSAs, the STD, and the 'Interim Facility Agreement' dated 22 February 2016 between

Arrium Limited, Arrium Finance, Arrium Iron Ore Holdings Pty Ltd (administrators

appointed) (ACN 152 752 844), and the Second to Fourth Defendants inclusive.

2 A declaration pursuant to section 21 of thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAFederal Court of Australia Act 1976 (Cth)

that:

(a) Arrium Limited is not obliged to pay the 'Work Fee' under cl 10 of the

Recapitalisation Deed;

(a1.(Q1_any amount payable under aREI--o_r_inconnection with the Recapitalisation

Deed (including tAe-illlY_'Work Fee' underzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAcI 10 of the Recapitalisation Deed

and any other cost provided for in cl 13 of the Recapitalisation Deed) is not an

indemnified liability under s 8.17 of the PSAs or any other provision of the

PSAs;

(G}.(QLthe Recapitalisation Deed is not a 'Finance Document' as defined in the STD;

W.(QLany amounts payable under amior in connection with the Recapitalisation

Deed (including .§D.YtAe 'Work Fee' under cI 10 of the Recapitalisation Deed

and other costs payable under cI 13 of the Recapitalisation Deed) are not

'Secured Money' as defined in the STD; and

(Eij.{gLany amount payable under amior in connection with the Recapitalisation Deed

is an unsecured liability of Arrium Limited (administrators appointed) (ACN

004410833) and, for the avoidance of doubt, is not secured by virtue of the

provisions of the Recapitalisation Documents,

where:

'Recapitalisation Deed' means the 'Recapitalisation Deed' dated 22 February 2016

between Arrium Limited and the First Defendant;

'PSAs' means, collectively:

(a) the 'Pledge and Security Agreement' dated 29 February 2016 between certain

of the Moly-Cop Entities listed in Schedule 2 and the Third Defendant; and


4

(b) the 'Pledge and Security Agreement' dated 29 February 2016 between certain

of the Moly-Cop Entities listed in Schedule 2 and the Fourth Defendant;

'STD' means the 'Security Trust Deed' dated 21 February 2016 between Arrium

Finance Pty Ltd (administrators appointed) (ACN 093 954 940) (Arrium Finance),

and the Second to Fourth Defendants inclusive; and

'Recapitalisation Documents' means, collectively, the Recapitalisation Deed, the

PSAs, the STD, and the 'Interim Facility Agreement' dated 22 February 2016 between

Arrium Limited, Arrium Finance, Arrium Iron Ore Holdings Pty Ltd (administrators

appointed) (ACN 152752844), and the Second to Fourth Defendants inclusive.

3 Costs.

4 Further or alternatively, an order that the costs of this application be costs in the

administrations of the Second Plaintiffs.

5 Such further or other orders as the Court deems fit.

Interlocutory relief

6 An order pursuant to rules 1.34 and 5.04 of thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAFederal Court Rules 2011 (Cth) (the

Rules) and rules 1.3(2) and 1.8 of the Federal Court (Corporations) Rules 2000 (Cth)

(the Corporations Rules) that:

(a) the proceeding continue by way of pleadings; and

(b) the proposed Statement of Claim at Tab 1 to Exhibt LZ-1 to the Affidavit of

Leon Zwier sworn 26 May 2016 be filed and served as the Plaintiffs'

Statement of Claim (the Statement of Claim).

7 An order pursuant to rules 10.42 and 10.43 of the Rules that the Plaintiffs have leave

to serve the Originating Process filed on 26 May 2016, the affidavit of Leon Zwier

sworn 26 May 2016, the Statement of Claim and any order of the Court made in this

proceeding (together, the Arrium Documents), on the First Defendant (GSO), in the

United Kingdom and the United States of America, and the Fourth Defendant (BNY

Canada) in Canada, in accordance with:

(a) article 5 of the Hague Convention on the Service Abroad of Judicial and

Extrajudicial Documents in Civil or Commercial Matters done at the Hague on


5

15 November 1965 (thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAHague Convention), by providing the District

Registrarwith three copies of the following documents:

(i) a requestfor service abroad, in Form25, with Part 1 completed;

(ii) the Arrium Documents;

(iii) a summaryof the Arrium Documents,in accordancewith Form26,

and requestingthat the District Registrarin his or her capacityas a forwarding

authority under the Hague Convention request the Central Authorities of the

United Kingdom, United States and Canada to serve the Arrium Documents

on:

(iv) GSO by personalservice at:

(A) 40 BerkeleySquare, London,W1J5AL, United Kingdom;

(B) 280 Park Avenue, 11th Floor, New York, New York, 10017

United States of America;

(C) 345 Park Avenue, 31st Floor, New York, New York, 10154

United States of America;and

(D) 200 Bellevue Parkway,Suite 210, Wilmington Delaware19809,

United States of America;and

(v) BNY Canada by personal service at 320 Bay Street, 11th floor,

Toronto, Ontario M5H4A6 Canada;or

(b) alternatively,article 10(a) of the Hague Convention,by sending a copy of the

Arrium Documents by registered international post to the corporate

headquartersof:

(i) GSO at:

(A) 40 BerkeleySquare, London,W1J5AL, United Kingdom;

(B) 280 Park Avenue, 11th Floor, New York, New York, 10017


48

6

(C) 345 Park Avenue, 31st Floor, New York, New York, 10154


(D) 200 Bellevue Parkway, Suite 210, Wilmington Delaware 19809

United States of America United States of America; and

(ii) BNY Canada at 320 Bay Street, 11th floor, Toronto, Ontario M5H 4A6

Canada.

8 An order pursuant to rule 10.24(a) of the Rules that the Plaintiffs have leave to serve

the Arrium Documents on GSO and BNY Canada by way of substituted service by

posting a copy of the Arrium Documents by registered international post to:

(a) GSO at:

(i) 40 Berkeley Square, London, W1J5AL, United Kingdom;

(ii) 280 Park Avenue, 11th Floor, New York, New York, 10017 United

States of America;

(iii) 345 Park Avenue, 31st Floor, New York, New York, 10154 United

States of America;

(iv) 200 Bellevue Parkway, Suite 210, Wilmington Delaware 19809 United

States of America United States of America; and

(b) BNY Canada at 320 Bay Street, 11th floor, Toronto, Ontario M5H 4A6

Canada.

9 Alternatively, an order pursuant to rule 10.24(a) of the Rules that the Plaintiffs have

leave to serve the Arrium Documents on GSO and BNY Canada by way of

substituted service by:

(a) posting a copy of the Arrium Documents by registered post to Mr Jason

Salman, C/- Level 17, 8 Chifley, 8-12 Chifley Square Sydney NSW 2000; and

(b) [email protected].

10 An order that pursuant to rule 10.24(c) of the Rules service in accordance with

paragraphs 8 and 9 above shall be deemed good and sufficient service on GSO and

BNY Canada.

49

7

11 An order pursuantto rules 1.39 of the Rules and 1.3(2)of the CorporationsRulesthat

service of this originating process on the persons referred to in Section E below in

accordancewith rule 2.7(1) of the CorporationsRules be abridgedas required.

12 Suchfurther or other orders as the Court deemsfit.

I DATE: ~OO_May.August2016

LeonZwierzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAARNOLD BLOCH LEIBLERSolicitorsfor the Plaintiffs

This application is listed for directions in the Federal Court of Australia, 305 William Street,

Melbourneat 9.15amon Tuesday,31 May2016.

B. NOTICE TO DEFENDANTS

Not applicable.

If you or your legal practitionerdo not appear before the Court at the time shown above, the

application may be dealt with, and an order made, in your absence. As soon after that time

as the businessof the Courtwill allow, any of the following may happen:

(a) the applicationmay be heard and final relief given;

(b) directions may be given for the future conductof the proceeding;

(c) any interlocutoryapplicationmay be heard.

Before appearing before the Court, you must file a notice of appearance, in the prescribed

form, in the Registryand serve a copy of it on the plaintiff.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

Note: Unless the Court otherwise orders, a defendant that is a corporation must be

representedat a hearing by a legal practitioner. It may be representedat a hearing

by a director of the corporationonly if the Courtgrants leave.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

C. APPLICATION FOR WINDING UP ON GROUND OF INSOLVENCY

Not applicable.



D. FILINGzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA

I Date of filing: 2&-Ittl~ August 2016

An officer actingwith the authorityof theDISTRICTREGISTRAR

This originating process is filed by Arnold Bloch Leibler of Level 21, 333 Collins Street,

Melbourne,VIC, 3000, solicitorsfor the Plaintiffs.

E. SERVICE

The Plaintiffs' address for service is c/- Arnold Bloch Leibler, Level 21, 333 Collins Street,

Melbourne,VIC, 3000.

It is intendedto serve a copy of this originatingprocesson each person listed below:

(a) each Defendant;

(b) each of the entities listed in Schedule2; and

(c) the AustralianSecuritiesand InvestmentsCommission.

The time by which a copy of this originating process is to be served has been abridged by

order made by the HonourableJustice Davieson 2016.

51

9

SCHEDULE 1





833 (AND EACH OF THE COMPANIES LISTED IN SCHEDULE 1)

First Plaintiffs



410 833) (administrators appointed), Arrium Finance pty Limited (ACN 093 954 940)

(administrators appointed) and Arrium Iron Ore Holdings Pty Limited (ACN 152 752 844)


Second Plaintiffs

Arrium Limited (ACN 004 410 833) (administrators appointed)


Arrium Iron Ore Holdings Pty Limited (ACN 152752844) (administrators appointed)

Defendants

GSO Capital Partners LP

First Defendant


Second Defendant


Third Defendant

BNY Trust Company of CanadaFourth Defendant



SCHEDULE 2

Moly-Cop Entities

Arrium Mining Sales Asia Limited

AltaSteel Ltd

Commonwealth Steel Company Pty Limited (ACN 000 007 698)

LiteSteel Technologies America, LLC

Maple Leaf Metals

Moly-Cop Adesur S.A.

Moly-Cop Canada

Moly-Cop Chile S.A.

Moly-Cop Mexico S.A. de C.v.

Moly-Cop Steel Inc.

Moly-Cop USA.. LLC

OneSteel Group (US Holdings) Inc.

OneSteel Recycling Hong Kong Limited

OneSteel Recycling, Inc.

OneSteel US Investments

PT Commonwealth Steel Indonesia


Form 17Rule 8.05(1)(a)

FederalCourt of AustraliaDistrict Registry:VictoriaDivision:CorporationsList

No. VID 527 of 2016

IN THE MATTER OF ARRIUM LIMITED (ADMINISTRATORSAPPOINTED)ACN 004410833(AND EACH OF THE COMPANIESLISTED IN SCHEDULE1)

MARK FRANCISXAVIER MENTHA,CASSANDRA ELYSIUM MATHEWS,MARTIN MADDENAND BRYAN WEBSTER IN THEIR CAPACITIESAS JOINT AND SEVERALADMINISTRATORSOF ARRIUM LIMITED (ADMINISTRATORSAPPOINTED)ACN 004410833 (AND EACH OF THE COMPANIESLISTED IN SCHEDULE 1)

First Plaintiffs

ARRIUM LIMITED (ADMINISTRATORSAPPOINTED)ACN 004410833 (AND EACH OF THECOMPANIESLISTED IN SCHEDULE 1)

Second Plaintiffs

- and-

GSO CAPITAL PARTNERS LP (AND OTHERSAS LISTED IN SCHEDULE1)

Defendants

AMENDED STATEMENTOF CLAIM

Parties and background

1 The First Defendant (GSO) is a foreign limited partnershipdomiciled in the State of New

York in the United States of America and organised under the laws of the State of

Delaware in the United States of America and capable at all material times of being

sued.

2 The Second Defendant (BTA Australia) is a company registered under the laws of

Australia and capable at all materialtimes of beingsued.

3 The Third Defendant (BNY Australia) is a company registered under the laws of

Australia and capable at all materialtimes of beingsued.

Filed on behalf of:Prepared by:Law firm:Tel: 92299999

the PlaintiffsLeon ZwierARNOLD BLOCH LEIBLER

Fax: 9229 9900 DX 38455 Melbourne

Email:[email protected] for service: Level 21, 333 Collins Street, Melbourne, VIC 3000


2

4 The Fourth Defendant (BNY Canada) is a company registered under the laws of

Canadaand capable at all materialtimes of being sued.

5 The First Plaintiffs (the Administrators) are the joint and several voluntary

administratorsof the Second Plaintiffs (the Arrium Borrowers), being:

(a) Arrium Limited (administratorsappointed) (Arrium Limited);

(b) Arrium FinancePty Limited(administratorsappointed) (Arrium Finance);

(c) Arrium Iron Ore Holdings Pty Limited (administrators appointed) (Arrium Iron

Ore).

6 Each of the Arrium Borrowerswas placed into voluntary administrationpursuantto Part

5.3A of thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBACorporations Act 2001 (Cth) on 7 April 2016.

7 The Arrium Borrowers are part of a larger group of entities that are direct or indirect

subsidiariesof Arrium Limited (the Arrium Group) which group also includes:

(a) Molycop Steel Inc., a corporation incorporatedunder the laws of the Provinceof

Alberta Canada (Molycop Steel);

(b) Altasteel Ltd, a corporation incorporated under the laws of the Province of

Alberta, Canada (Altasteel);

(c) Moly-Cop Canada, a partnership organised under the laws of the Province of

Alberta, Canada (Moly-Cop Canada);

(d) Maple Leaf Metals (a Partnership)a partnershiporganised under the laws of the

Provinceof Alberta, Canada (Maple Leaf Metals);

(e) OneSteel Group (US Holdings) Inc., a corporation incorporatedunder the laws

of the State of Delaware, United States of America (OneSteel US Holdings);

and

(f) Moly-Cop USA, LLC, a limited liability company incorporated under the laws of

the State of Delaware,United Statesof America (Moly-Cop USA);

(collectively,the Moly-Cop Security Grantors).

8 The Moly-Cop Security Grantors are not in voluntary administration or subject to any

other insolvencyor external administrationproceedings in the jurisdictions in which they

are domiciled.


3

Recapitalisation Documents

9 Certain members of the Arrium Group were parties to documents executed in February

2016 providing for a proposed recapitalisation of the Arrium Group (Proposed

Recapitalisation), which documents included:

(a) an 'Interim Facility Agreement' dated 22 February 2016 between Arrium Limited,

Arrium Finance, Arrium Iron Ore, certain lender 'Participants' (being affiliates of

or funds managed by GSO), BTA Australia as agent, BNY Australia as Australian

security trustee and BNY Canada as Canadian security trustee, which agreement

provided for a US$140 million syndicated secured loan facility to be made

available to the Arrium Borrowers (the Interim Facility Agreement);

(b) a 'Recapitalisation Deed' dated 22 February 2016 between Arrium Limited and

GSO (Recapitalisation Deed);

(c) a 'Security Trust Deed' dated 21 February 2016 between Arrium Finance, BTA

Australia, BNY Australia and BNY Canada (STD);and

(d) two 'Pledge and Security Agreements' (PSAs)being:

(i) a 'Pledge and Security Agreement' dated 29 February 2016 between

Molycop Steel, Altasteel and Maple Leaf Metals on the one hand as

grantors of security and BNY Canada on the other; and

(ii) a 'Pledge and Security Agreement' dated 29 February 2016 between

OneSteel US Holdings and Moly-Cop USA on the one hand as grantors

of security and BNY Australia on the other,

(the five documents above, together, the Recapitalisation Documents).

Particulars

Each of the Recapitalisation Documents is in writing. Copies of the

Recapitalisation Documents can be inspected at the offices of the Plaintiffs'

solicitors by appointment.

10 The Moly-Cop Security Grantors and certain other entities within the Arrium Group

provided 'Securities' (as defined in the STD), including the PSAs (the Securities), to

secure the payment of the 'Secured Money' (as defined in the STD) to the 'Beneficiaries'

(as defined in the STD) under the 'Finance Documents' (as defined in the STD).


4

11 Under cla!:lses1O~ and 1a of the RecapitalisationDeed, Arrium Limitedwas obliged,

inter alia, to pay to GSO a 'Work Fee' (Work Fee) accordingto agreed calculationsand

under certain circumstances if the Arrium Group did not proceed with the Proposed

Recapitalisationand certain other 'out of pocket' costs and expenses.

12 The ProposedRecapitalisationdid not proceed.

13 Under cl 10.1(c) of the RecapitalisationDeed, Arrium Limited is not obliged to pay GSO

the Work Fee if GSO did not confirm to Arrium Limited whether or not the 'GSO

Condition' (as defined in cll 1.1 and 2(b) of the RecapitalisationDeed) had been fulfilled

by 5pm on the day prior to the 'End Date' (as defined in cl 1.1 of the Recapitalisation

Deed) in accordancewith cl 9(b) of the RecapitalisationDeed (GSO Notice Obligation).

14 The 'End Date' occurredon 5 April 2016.

15 GSO did not satisfy the GSO NoticeObligation.

16 Undercl 13 of the RecapitalisationDeed,Arrium Limitedwas obliged, inter alia, to pay to

GSO certain 'out of pocket' costs and expenses in certain circumstances.

-ta.1L_ On or about 5 and 6 April 2016, GSO requestedthat Arrium Limitedpay:

(a) the Work Fee of A$9,090,909(in respectof cl 10of the RecapitalisationDeed);

(b) expensesof A$3,000,000(in respectof cI 13.2of the RecapitalisationDeed);and

(c) certain professionalfees amountingto A$224,540.57.

Particulars

These fees and expensesare summarisedin emails from Mark Rutledgeof GSO

to Naomi James and Sarah Pearce of Arrium Limited dated 5 April 2016 and 6

April 2016. Copies of the emails may be inspectedat the offices of the Plaintiffs'

solicitors by appointment.

441JL_On 18 April 2016, BTA Australia issued a demand for the repaymentof the outstanding

principal and interest under the Interim FacilityAgreement to the Arrium Borrowersand

certain guarantors.

4-§.tlL_Onor about 21 April 2016, the Arrium Borrowerspaid:

(a) US$100,64~a,445 to BTA Australia in respect of principal and interest owing

under the Interim Facility Agreement pursuant to the demand made on 18 April

2016; and



(b) US$6,761 ,633 to Gilbert + Tobin to be held on trust on the condition that Gilbert

+ Tobin have an irrevocable authority to pay to BTA Australia out of that sum

such amounts which BTA Australia and the Administrators agree are properly

payable under the Interim Facility Agreement.

4-S~ln letters dated 28 April 2016 and 13 May 2016 from BTA Australia to the Arrium

Borrowers and the Administrators, BTA Australia asserted, inter alia, that:

(a) the amount of the Work Fee and other costs in connection with the

Recapitalisation DeedzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA(Recapitalisation Deed Amounts) were due and payable

by the Moly-Cop Security Grantors under the indemnity contained in s 8.17 of

each of the PSAs;

(b) the Recapitalisation Deed Amounts were properly payable as 'Secured Money'

under the STD; and

(c) the Securities, including the PSAs, would not be released until the

Recapitalisation Deed Amounts were fully and finally paid.

Particulars

Copies of the letters from BTA Australia to the Arrium Borrowers and the

Administrators dated 28 April 2016 and 13 May 2016 may be inspected at the

offices of the Plaintiffs' solicitors by appointment.

4-7~Notwithstanding payment of the amounts in paragraph 194a above, the Securities,

including the PSAs, have not been released.

Construction of the Recapitalisation Documents

48~ On the proper construction of the Recapitalisation Documents:

(a) Arrium Limited is not liable to pay GSO the Work Fee if the GSa Notice

Obligation was not satisfied;

W.(QL_any amount payable under or in connection with the Recapitalisation Deed

(including the Recapitalisation Deed Amounts, tAe-m1Y_Work Fee and any other

cost provided for in cI 13 of the Recapitalisation Deed) is not an indemnified

liability under s 8.17 of the PSAs or any other provision of the PSAs;

tb).(QLthe Recapitalisation Deed is not a 'Finance Document' as defined in the STD;

and

58


fs).(QLany amount payable under or in connection with the Recapitalisation Deed

(including the RecapitalisationDeed Amounts, tRe-ru:lY....Work Fee and any other

cost providedfor in cI 13 of the RecapitalisationDeed) is not 'Secured Money' as

defined in the STD.

4-9~ln the circumstances, the Plaintiffs are entitled to declarations, and the Administrators

are entitled to directions,that:

(a) Arrium Limited is not obligedto pay GSa the Work Fee:

{a1!QLany amount payable under or in connection with the Recapitalisation Deed

(including the RecapitalisationDeed Amounts, tAeru:lY....WorkFee and any other

cost provided for in cl 13 of the Recapitalisation Deed) is not an indemnified

liability under s 8.17 of the PSAs or any other provisionof the PSAs;

tb){£1_the RecapitalisationDeed is not a 'Finance Document'as defined in the STD;

fs).(QLany amount payable under or in connection with the Recapitalisation Deed

(including the RecapitalisationDeed Amounts, tRe-anyWork Fee and any other

cost providedfor in cl 13 of the RecapitalisationDeed) is not 'Secured Money' as

defined in the STD; and

(G)~any amount payable under or in connection with the RecapitalisationDeed is an

unsecured liability of Arrium Limited and, for the avoidance of doubt, is not

secured by virtue of the provisionsof the RecapitalisationDocuments.

I Date:a-oo.JuRe...August2016

This Statementof Claim was preparedby Banjo McLachlanand settled by PhilipCrutchfieldof

Counsel.

Signed by LeonZwier

Lawyerfor the Plaintiffs


7

SCHEDULE 1





(AND EACH OF THE COMPANIES LISTED IN SCHEDULE 1)

First Plaintiffs



410 833) (administrators appointed), Arrium Finance pty Limited (ACN 093 954 940)

(administrators appointed) and Arrium Iron are Holdings Pty Limited (ACN 152 752 844)


Second Plaintiffs

Arrium Limited (ACN 004410833) (administrators appointed)


Arrium Iron are Holdings Pty Limited (ACN 152752844) (administrators appointed)

Defendants

GSa Capital Partners LP

First Defendant


Second Defendant


Third Defendant

BNY Trust Company of CanadaFourth Defendant



Certificate of lawyer

I, Leon Zwier, certify to the Court that, in relation to the Amended Statement of Claim filed on

behalf of the Plaintiffs, the factual and legal material available to me at present provides a

proper basis for each allegation in the pleading.

Date: [#] August 2016

Signed by Leon ZwierLawyer for the Plaintiffs