// Background //

On 5 November 2015, the Fundão tailings dam at the Germano mine in Minas Gerais, Brazil collapsed in the largest tailings dam rupture ever recorded. The mudflow killed 19 people and has had a catastrophic and enduring impact on the surrounding communities and the environment.

// Allegations //

The BHP Class Action is an open class proceeding and seeks recovery of investor losses incurred up to 30 November 2015 by BHP Ltd and BHP Plc shareholders because of BHP’s alleged failure to disclose material information to the market and its alleged misleading or deceptive conduct.

// Funding and Costs //

The BHP Class Action is partially funded by G&E KTMC Funding LLC.

G&E KTMC Funding LLC is backed by Grant & Eisenhofer and Kessler Topaz Meltzer & Check, two of the United States’ most successful and respected shareholder litigation firms.

Pursuant to the financial terms and funding terms for the BHP Class Action, G&E KTMC is exclusively responsible for adverse costs orders and security for costs and has agreed to pay:

1. all disbursements incurred in the BHP Class Action;
2. Phi Finney McDonald under its current terms of engagement for performing the legal work;
3. premiums associated with after-the-event insurance arrangements procured for the BHP Class Action

(together G&E KTMC’s Expenses).

Maurice Blackburn is performing its legal work on a No Win, No Fee basis, charging a 6.25% uplift in the event the class action is successful.

In the event of a successful outcome or judgment in favour of the Joint Applicants, the Joint Applicants intend to apply to the Court for an order that both Funded and Unfunded Group Members to the Consolidated Proceeding contribute a pro-rata amount to the costs incurred in conducting the consolidated proceeding and to pay G&E KTMC a percentage of any compensation to which the Funded and Unfunded Group Members become entitled as commission for funding the BHP Class Action. These orders are called “common fund orders” (CFOs).

The Joint Applicants intend to seek common fund orders for:

1. reimbursement of legal costs inclusive of uplift, disbursements and other litigation expenses incurred by the Joint Applicants in the BHP Class Action;
2. reasonable settlement administration costs;
3. reimbursement of costs and premiums paid or payable under the after-the-event insurance arrangements procured for the BHP Class Action; and
4. a percentage commission to G&E KTMC calculated on the basis of the total settlement or judgment sum minus G&E KTMC’s Expenses (net recovery) as follows:
   1. 27.5% of any net recovery up to $200 million;
   2. 25% of the net recovery of the next $100 million;
   3. 22.5% of the net recovery of the next $100 million;
   4. 20% of the net recovery of the next $100 million; and
   5. 15% of any net recovery over $500 million.

If there is a successful outcome, the amounts payable to G&E KTMC by Group Members will be deducted from the settlement or judgment sum (in addition to the reimbursement of reasonable costs incurred including recovery of premiums associated with after-the-event insurance arrangements procured for the BHP Class Action) before the balance is distributed to Group Members.

The total amounts deducted for legal costs and G&E KTMC’s commission from compensation payable to Group Members by way of a CFO will never exceed the amount a Group Member receives in the event of a successful outcome.