Spotless : applies for ASX Delisting

25 June 2019

Spotless applies for ASX Delisting

Spotless Group Holdings Limited (ASX:SPO) (Spotless) has today submitted a formal application for the removal of Spotless from the Australian Securities Exchange (ASX) official list (Official List) pursuant to ASX Listing Rule 17.11 (Delisting) and has released the Notice of Meeting of Spotless shareholders (Shareholders) being convened to consider, and if thought fit, to approve the Delisting.

Reasons for delisting from the ASX

The Spotless Board considers the Delisting to be in the best interests of Spotless and its Shareholders for the reasons summarised below:

• Costs: The continued listing of Spotless requires Spotless to incur considerable corporate and administrative costs, including listing fees. Spotless is seeking to minimise its expenditure and would cease incurring such costs if it is removed from the Official List. The Board of Spotless has determined that the costs of remaining listed on the ASX outweigh any benefits of listing for Spotless.
• Liquidity and shareholder spread: Trading in the ordinary shares of Spotless has had a low level of liquidity over a significant period on the ASX, which has led to low trading volumes and an erratic share price. Two shareholders in Spotless collectively hold 99.44% of the ordinary shares in Spotless (Shares).

Further information in relation to the above reasons are set out in section 1.2 of the Explanatory Statement to the Notice of General Meeting attached to this announcement as Annexure A.

Both Downer EDI Limited (Downer) and Spotless made prominent disclosures during the 2017 takeover offer by Downer (through its wholly-owned subsidiary, Downer EDI Services Pty Ltd) for Spotless that, if Downer was to take control of Spotless, it was likely that Spotless would apply to remove itself from the Official List, including for the reasons set out above.

Delisting process

Spotless has received in-principle advice from ASX that it would be likely to remove the Company from the official list, on a date to be determined by ASX in consultation with the Company, subject to compliance with the following conditions:

1. the Company's removal from the official list of ASX is approved by a special resolution of ordinary shareholders of the Company;

1. the notice of meeting seeking shareholder approval for the Company's removal from the official list must include a statement, in form and substance, satisfactory to ASX, setting out:

1. that the removal will take place no earlier than one month after approval is granted;

1. the time and date at which the Company will be removed from the ASX if that approval is given;

1. that if shareholders wish to sell their shares on ASX, they will need to do so before the Company is removed from the official list of ASX; and if they do not, details of the processes that will exist after the Company is removed from the official list to allow shareholders to dispose of their holdings and how they can access those processes; and

1. 1. include, to ASX's satisfaction, information prescribed in section 2.11 of ASX
      Guidance Note 33; and
2. the Company releases the full terms of the ASX decision to the market upon making a formal application to ASX to remove the Company from the official list of ASX.

In accordance with the condition set out in (c) above, the full terms of the ASX decision are set out above.

In order to satisfy the condition set out in (a), Spotless will hold a general meeting on Friday 26 July 2019 to consider, and if thought fit, to approve the Delisting (by passing a special resolution). The Notice for that meeting is attached as Annexure A, and it (together with its accompanying Explanatory Statement) contains the statements to satisfy the condition set out in (b) above.

Consequences of Delisting

The consequences of the Delisting for Spotless and Shareholders include:

• Shares will no longer be quoted or traded on ASX and Shareholders will only be able to sell their Shares via off-market private transactions in accordance with Spotless' constitution (which will require Shareholders to identify and agree terms with potential purchasers of Shares);
• as an unlisted public company, Spotless will not have the ability to raise capital from the issue of securities in reliance on a limited disclosure fundraising document. If Spotless wishes to raise capital following the Delisting, this will be by way of an offer of shares pursuant to a full prospectus or by way of a placement to sophisticated and institutional investors (to whom such disclosure is not required);
• while Spotless continues to have in excess of 100 shareholders after the Delisting, Spotless will be an 'unlisted disclosing entity' for the purposes of the Corporations Act 2001 (Cth)

(Corporations Act), and will therefore remain subject to the continuous disclosure provisions in section 675 of the Corporations Act, which require an entity to lodge certain material information with the Australian Securities and Investments Commission;

• Spotless will remain subject to the takeover provisions and protections in Chapter 6 of the Corporations Act for so long as there are 50 or more Shareholders; and
• the ASX Listing Rules will no longer apply to Spotless and shareholder protections contained in the ASX Listing Rules will no longer apply, including certain restrictions on the issue of Shares by Spotless, certain restrictions in relation to transactions with persons in a position of influence and the requirement to address the ASX Corporate Governance Principles and Recommendations on an annual basis. However, Spotless will continue to be subject to, and the Shareholders will still have the benefit of, certain provisions of the Corporations Act applicable to unlisted public companies including, among other things, the related party provisions in Chapter 2E of the Corporations Act. Further information in relation to the consequences of the Delisting are set out in section 1.4 of the Explanatory Statement to the Notice of General Meeting attached as Annexure A.

As set out above, the Delisting is subject to approval by a special resolution of Shareholders. Shareholders should be aware that, in addition to the right to participate in discussion and vote at the Shareholders' meeting, it is possible to pursue additional remedies under the Corporations Act in relation to the Delisting, including:

• under Part 2F.1 of the Corporations Act, pursuant to which a member of a company may apply to a court to make certain orders if an act or proposed act of the company, or a proposed resolution of members, is either (i) contrary to the interests of members as a whole; or (ii) oppressive to, unfairly prejudicial to, or unfairly discriminatory against, a member or members whether in that capacity or any other capacity; or
• under Part 6.10, Division 2 Subdivision B of the Corporations Act, pursuant to which any person whose interests are affected by circumstances in relation to the affairs of a company may apply to the Takeovers Panel to seek a declaration that those circumstances are
  'unacceptable circumstances' within the meaning of the Corporations Act.

Sale of Shares by Shareholders

As set out in section 1.2(a) of the Explanatory Statement to the Notice of General Meeting attached as Annexure A, Spotless does not intend to offer a specific liquidity facility in conjunction with its removal from the official list of ASX.

However, Shareholders who wish to sell their shares remain able to trade their shares to willing counterparties on-market on the ASX up to the date of suspension of trading of the Company's shares prior to its removal from the Official List. If shareholders approve the Delisting, trading in its shares will be suspended from 7.00 pm on 27 August 2019 and Spotless will be removed from the Official List of ASX at 7.00 pm on 30 August 2019, which is more than one month after the date on

which the shareholder approval would be obtained and more than two months from the date of this announcement.

Next steps and timing

The general meeting of Shareholders to consider and, if thought fit, approve the Delisting will be held on Friday, 26 July 2019. Spotless will announce the outcome of the vote at the General Meeting as soon as practicable after the close of that meeting.

If the Delisting is approved by a special majority at that meeting, then the Company will be removed from the official list of ASX on 30 August 2019. Trading in its shares will be suspended from 7.00pm on 27 August 2019. The proposed timetable for the removal of the Company from the Official List of ASX is set out in section 1.4 of the Explanatory Statement to the Notice of General Meeting attached as Annexure A.

ANNEXURE A - NOTICE OF GENERAL MEETING

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