Huon Aquaculture Group Limited, in the matter of Huon Aquaculture Group Limited (No 2) [2021] FCA 1385

O'CALLAGHAN J: 1 I made the orders set out above at a hearing held on 3 November 2021. These are my reasons for doing so. 2 No question of principle arose, and counsel's detailed written submissions in support of the making of the orders, and the evidence relied on, did not reveal any issue that warranted the giving of any detailed or particular consideration. These reasons are therefore brief. 3 Huon Aquaculture Group Limited (Huon) is a publicly listed company which operates a vertically integrated salmon production business. Its operations span all aspects of the supply chain from hatcheries and marine farming to harvesting and processing, as well as sales and marketing. Huon's marine farms, and its registered office, are located in Tasmania. 4 On 22 September 2021, I made orders (the September 22 Orders) that Huon convene and hold two separate meetings of Huon shareholders (Scheme Meetings) concerning two alternative schemes of arrangement that were being proposed concurrently (collectively, the Schemes). See Re Huon Aquaculture Group Limited [2021] FCA 1170 (Huon No 1). 5 These reasons should be read in conjunction with Huon No 1, including at [5]ff, where I explained why two alternative and concurrent schemes of arrangement (and a simultaneous takeover bid) were proposed. 6 The Scheme Meetings were held, as planned, on 29 October 2021 and the Scheme resolution proposed at each Scheme Meeting was passed by the requisite statutory majorities (with the voting results being overwhelmingly in favour of the Schemes). 7 At the hearing on 3 November, Huon sought an order that the Primary Scheme - or the "Structure A Scheme", as it is referred to in the originating process and transaction documents - be approved pursuant to s 411(4)(b) of the Corporations Act 2001 (Cth) (Act), and an order exempting it from compliance with s 411(11). 8 It is therefore not necessary to deal separately with the Secondary Scheme (or the "Structure B Scheme", as it is referred to in the originating process and transaction documents). 9 Huon relied on the following affidavits: (a) affidavit of Neil Alexander Kearney sworn 1 November 2021 (Chairman of Huon and Chair of the two Scheme Meetings and the Annual General Meeting), which addressed the holding of the Scheme Meetings, and the voting on the Scheme resolution at each Scheme Meeting; (b) affidavit of Jim Kompogiorgas affirmed 2 November 2021 (Client Relationship Manager at Link Market Services), which addressed, among other matters, the operation of the Huon register, and the postal and email dispatch of the Scheme materials on 29 September 2021, being the dispatch date under the September 22 Orders; (c) affidavit of Jim Kompogiorgas affirmed 2 November 2021, which addressed receipt and processing of proxy forms, the operation of the platform used for the virtual Scheme Meetings, and acting as the returning officer for the poll at the Scheme Meetings; (d) affidavit of Jim Kompogiorgas affirmed 2 November 2021, which annexed additional sample dispatch materials, including proxy forms, issuer acceptance forms, CHESS acceptance forms, and a post card; (e) affidavit of Thomas Cleveland Haselgrove sworn 2 November 2021 (CFO and Company Secretary of Huon), which addressed the uploading of the Transaction Booklet to the ASX platform, the voting results of the Scheme Meetings, the announcement of the results of the Scheme Meetings and the Annual General Meeting to the ASX, and ASX announcements made by Huon since the first court hearing on 22 September 2021; (f) affidavit of William Ross Robertson sworn 3 November 2021 (a solicitor employed by Ashurst, Huon's solicitors), which addressed the preparation of the typeset Transaction Booklet, the finalisation of each of the proxy forms, the email notification to Huon shareholders, and the post card; (g) affidavit of John Richard Brewster sworn 2 November 2021 (a partner of Ashurst), which addressed the registration of the Transaction Booklet with ASIC on 23 September 2021, and the provision of documents to ASIC for the purpose of the 3 November hearing; (h) affidavit of Andrew James Hunter Harpur sworn 3 November 2021 (a partner of Ashurst), which addressed the advertisement of the 3 November hearing, and the fact that no notice had been received from any person proposing to object to the approval of the Schemes; and (i) affidavit of John Richard Brewster sworn 3 November 2021, which addressed (among other matters) the satisfaction of the conditions precedent to the Schemes, exhibited a letter from ASIC dated 3 November 2021 stating that it has no objection to the Schemes, and addressed the fact that no notice had been received from any person proposing to appear at the 3 November hearing. 10 The role of the court in approving a scheme of arrangement is supervisory. The court is not bound to approve it merely because it previously made orders for the convening of a meeting or because the statutory majorities were achieved. That said, as Jacobson J said in Re Seven Network Limited (No 3) [2010] FCA 400; (2010) 267 ALR 583 at [32], "the court will usually approach the task upon the basis that the members are better judges of what is in their commercial interests than the court". 11 The cases establish that the following matters should be taken into account, namely that: (a) the orders of the court convening the scheme meeting were complied with; (b) the resolution to approve the scheme was passed by the requisite majority, and whether other statutory requirements have been satisfied; (c) all conditions to which the scheme is subject (other than court approval and lodgement of the court's orders with ASIC) have been met or waived; (d) the scheme is fair and reasonable so that an intelligent and honest shareholder, properly informed and acting alone, might approve it; (e) there was full and fair disclosure to shareholders of all information material to the decision whether to vote for or against the scheme; (f) the plaintiff has brought to the attention of the court all matters that could be considered relevant to the exercise of the court's discretion; and (g) the plaintiff has a statement from ASIC that it has no objection to the scheme. 12 Aside from a couple of inconsequential matters to which my attention was drawn by counsel for Huon, which do not warrant mention here, I am satisfied on the evidence that the September 22 Orders concerning the dispatch of scheme materials were complied with. 13 Likewise, the evidence established that the Scheme Meetings were held in accordance with the September 22 Orders, namely: (a) the Scheme Meetings were held as virtual meetings on 29 October 2021; (b) the Chair opened each of the Primary Scheme Meeting, the Secondary Scheme Meeting and the Annual General Meeting at 10.00am (Hobart Time) and then adjourned the Secondary Scheme Meeting to the conclusion of the Primary Scheme Meeting; (c) the Scheme Meetings were chaired by Neil Alexander Kearney; (d) there was a quorum present at each of the Scheme Meetings; and (e) a poll was taken on the Scheme resolution at each of the Scheme Meetings. 14 The evidence was that 90.05% of the Huon shareholders (other than the excluded shareholder, being Surveyors Investments Pty Ltd (Surveyors)) that were present and voting (either in person or by proxy) at the Primary Scheme Meeting voted in favour of the Scheme resolution and 99.77% of the votes cast (in person or by proxy) at the Primary Scheme Meeting were cast in favour of the Scheme resolution. 15 As to voter turnout, 53.63% of Huon's total share capital (representing 29.74% of Huon's total shareholders in number) voted on the Scheme resolution at the Primary Scheme Meeting. In that regard, it is to be noted that the 40.53% of Huon shares held by Surveyors did not vote, for reasons explained in Huon 1. 16 Such a turnout does not give rise to any concern that shareholders were deterred or did not have notice of the Scheme Meetings (cf Re Amcor Limited (No 2) [2019] FCA 842 at [18]-[20]). 17 The Primary Scheme is conditional on the satisfaction of the conditions precedent set out in clause 2.1 of that Scheme, which include in clause 2.1(a) a condition that all of the conditions set out in clauses 3.2 to 3.4 (inclusive) of the Implementation Deed, other than the conditions in clauses 3.2(d) and 3.2(e) (being court approval and lodgement of the approval order with ASIC), have been satisfied or waived in accordance with the terms of the Implementation Deed. 18 Before approving a scheme, the court will ordinarily require that all conditions precedent to the scheme (other than the court's approval and the lodgement of the court's approval order with ASIC) have been satisfied or waived, in order to remove any future doubt as to the binding nature of the scheme. No such concerns arise here. 19 In making the orders that Huon sought, I was satisfied that the Primary Scheme had been made in good faith and was "at least so far fair and reasonable, as that an intelligent and honest [person], who is a member of that class, and acting alone in respect of [their] interest[s] as such a member, might approve of it" (Re Alabama, New Orleans, Texas and Pacific Junction Railway Company [1891] 1 Ch 213 at 247, per Fry LJ) and that it was accordingly appropriate that the court exercise its jurisdiction to approve it, having regard in particular to the following: (a) the support of Huon shareholders as reflected in the voting results; (b) the opinion of the independent expert (see Huon No 1 at [16]); (c) ASIC had no objection; (d) the recommendation of the independent board committee of the Huon board in respect of the Primary Scheme; (e) the disclosures in the Transaction Booklet; (f) there is nothing to suggest that the Primary Scheme was proposed other than in good faith, that the shareholders voted other than in good faith, or that any shareholder was oppressed; and (g) the terms and nature of the Primary Scheme. 20 I was also satisfied that Huon had brought to the attention of the court all matters that could be considered relevant to the exercise of the court's discretion. 21 Huon also sought an order pursuant to s 411(12) of the Act that it be exempted from compliance with s 411(11). 22 Section 411(11) requires, subject to s 411(12), that a copy of the court's order approving a scheme of arrangement be annexed to every copy of the company's constitution issued after the order is made. Section 411(12) allows the court to exempt a body from compliance with this provision or to determine the period during which it shall comply. 23 As Huon correctly submitted, such exemption orders are almost invariably made in cases, like this, where the scheme does not involve any alteration to the constitution or modification of any rights of shareholders or creditors. And here, once the Primary Scheme is implemented, Huon will become a wholly owned subsidiary of JBS and the scheme will become "of historical interest". In such circumstances, no purpose is served in attaching the orders to the company's constitution. 24 For those reasons, I made the orders set out above. I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice O'Callaghan.

SCHEDULE OF PARTIES VID 512 of 2021 Interested Parties First Interested Party JBS AQUACULTURE PTY LTD Second Interested Party JBS AUSTRALIA PTY LTD Third Interested Party INDUSTRY PARK PTY LTD