Obton Lotus Energy Rooftop Solar - Case Update

The deed administrator of Obton Lotus Energy Rooftop Solar (OLERS) has secured the court’s approval to transfer certain shares in the company to a secured creditor over the objections of one of the company’s two directors. David Coyne of BRI Ferrier was appointed administrator of the solar energy company in October by Obton A/S, the company’s secured creditor and majority shareholder. In late November, the company’s creditors voted to accept a DOCA proposal from Obton A/S which provided for the payment of secured creditors in full and the transfer of the minority shareholder’s shares in OLERS to Obton A/S. The opposing director argued the transfer shouldn’t be approved on the basis that the DOCA was orchestrated “not to restructure an insolvent enterprise”, but to “remove minority shareholders for the benefit of Obton A/S”. He sought an adjournment of the deed administrator’s application in order to apply to set aside or terminate the DOCA. The court refused the adjournment and approved the transfer. The opposing creditor had not sought to set aside or terminate the DOCA and had not provided a sufficient excuse for the delay in doing so. In addition, the shareholders were out of the money and could suffer no prejudice from the transfer of shares.

Read the decision here.