Michelago Limited ACN 057 816 609, in the matter of Michelago Limited ACN 057 816 609 (No 3) [2006] FCA 1845

FEDERAL COURT OF AUSTRALIA

Michelago Limited ACN 057 816 609, in the matter of Michelago Limited ACN 057 816 609 (No 3) [2006] FCA 1845

MICHELAGO LIMITED ACN 057 816 609, IN THE MATTER OF MICHELAGO LIMITED ACN 057 816 609 NSD2091 OF 2006

EMMETT J

13 DECEMBER 2006

SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD2091 OF 2006

IN THE MATTER OF MICHELAGO LIMITED ACN 057 816 609 MICHELAGO LIMITED ACN 057 816 609

Applicant

JUDGE: EMMETT J DATE OF ORDER: 13 DECEMBER 2006

WHERE MADE: SYDNEY

THE COURT ORDERS THAT:

1. Pursuant to section 411(4)(b) of the Corporations Act 2001 the scheme of arrangement between the Plaintiff and holders of its ordinary shares in the form annexed hereto and marked "A" be approved. 2. Pursuant to section 411(4)(b) of the Corporations Act 2001 the scheme of arrangement between the Plaintiff and its listed optionholders in the form annexed hereto and marked "B" be approved. 3. Pursuant to section 411(12) of the Corporations Act 2001, the Plaintiff be exempted from compliance with section 411(11) of the Corporations Act 2001 in relation to the order at paragraphs 1 and 2. 4. These orders be entered forthwith.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD2091 OF 2006

IN THE MATTER OF MICHELAGO LIMITED ACN 057 816 609 MICHELAGO LIMITED ACN 057 816 609

Applicant

JUDGE: EMMETT J

DATE: 13 DECEMBER 2006

PLACE: SYDNEY

REASONS FOR JUDGMENT 1 On 27 October 2006, the Court ordered the applicant, Michelago Limited ('the Company'), to convene meetings of its members and optionholders for the purpose of considering schemes of arrangement. The general purpose of the schemes and their effect is to provide for the merger of Michelago with Golden China in the manner briefly described in my reasons of 27 October 2006 (see [2006] FCA 1490). The meetings have now been held and the Company has applied to the Court for approval of the schemes pursuant to s 411 of the Corporations Act 2001 (Cth) ('the Act'). 2 I am satisfied from the evidence filed in the proceeding, consisting of affidavits of Rebecca Mary White sworn 12 December 2006 and a statement in Form 530 by Mr Ian Keith White, the secretary of Michelago Limited, that the explanatory booklet in the form that I considered on 27 October 2006 and a supplementary disclosure document were sent to members and optionholders. 3 At the meetings held on 6 December 2006, the shareholders passed a resolution agreeing to the scheme involving them. The resolution was passed by a majority of 97.11 per cent of shareholders present and by a majority of 99.23 per cent of the votes cast in the resolution. The optionholders also passed a resolution that the scheme involving them be agreed to. The resolution was passed by a majority of 94.44 per cent of optionholders present and voting, being a majority whose claims against the Company's optionholders amount in the aggregate to 98.64 per cent of the total amount of the claims of the optionholders present and voting. 4 Those facts are proved by affidavits of Allan Alexander Nicol and John Patrick Horan. That evidence, together with an affidavit of Ian Keith White, indicate that the members and optionholders were given the opportunity of voting by proxy and that all valid proxies were taken into account in the vote. 5 The proposed application today, for approval of the schemes, was advertised in accordance with directions that I gave. When the matter was called today there was no appearance except by senior counsel for the Company, and no person has indicated to the solicitors for the Company any intention of appearing in the hearing of the application for approval of the schemes. 6 By letter of 8 December 2006, the Australian Securities and Investments Commission ('the Commission') has confirmed, in accordance with s 411(17) of the Act, that the Commission has no objection to either of the schemes and has no intention of appearing in the hearing of this application. 7 The schemes were expressed to be conditional upon a number of matters. I am satisfied, from certificates signed on behalf of both the Company and Golden China, that all of the conditions precedent to the operation of the schemes have been satisfied or waived, save for the condition of Court approval. The consideration for the acquisition by Golden China of shares in the Company was the allotment of shares in Golden China. The shares to be allotted were to be new consolidated shares. 8 I am satisfied from the evidence of Gary Quedado and Alexander James Robson Grieve, that the proposed consolidation of Golden China shares has occurred and that approval for admission to Toronto Stock Exchange has been given in respect of those shares. In addition, the Australian Securities Exchange ('ASX') has also admitted Golden China shares to quotation on the ASX. Arrangements are in place for transfers of interests in shares in Golden China to be dealt with electronically by means of CHESS depositary interests. The effect of the arrangements is that shareholders who wish to deal with interests in Golden China on ASX do not have legal ownership, but have an equitable interest in shares which are registered in the name of CHESS Depositary Nominees Pty Ltd. 9 Having regard to the resolutions of members and optionholders agreeing to the terms of the schemes and having regard to the fact that on 27 October 2006 I was satisfied that the schemes are schemes that reasonable shareholders, properly informed, might agree to, I am satisfied that it is appropriate now to approve both schemes.