Federal Court of Australia

Dragon Mining Limited, in the matter of Dragon Mining Limited (No 2) [2026] FCA 1138

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 411(4)(b) of the Corporations Act 2001 (Cth) (Act), the scheme of arrangement between the plaintiff and holders of fully paid ordinary shares in the capital of the plaintiff, in the form contained in appendix XI of the scheme booklet which is annexure 'RAF-25' of the affidavit of Robyn Anne Ferguson sworn 10 August 2026 (Scheme), is approved.

2.    Pursuant to s 411(12) of the Act, the plaintiff is exempted from compliance with s 411(11) of the Act, in relation to the Scheme.

3.    The plaintiff is to lodge a copy of these orders with the Australian Securities and Investments Commission as soon as practicable after the orders are made.

4.    These orders be entered forthwith.

THE COURT NOTES THAT:

The plaintiff and Dragon Gold Mining Ltd intend to rely on:

A.    The orders or reasons for judgment as the basis of a claim of an exemption pursuant to section 3(a)(10) of the Securities Act of 1933 (USA) (as amended) (US Securities Act) from the registration requirements of the US Securities Act in connection with the issuance and exchange of all Scheme consideration pursuant to the Scheme based on the Court's approval of the Scheme;

B.    the fact that the Scheme is consummated under the statutory provisions of the Act; and

C.    the fact that the Court held a hearing to consider the fairness and reasonableness of the terms and conditions of the Scheme and the Court has determined that the Scheme is fair and reasonable in the sense that an intelligent and honest shareholder, properly informed and acting alone might approve it.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

VANDONGEN J:

1    These reasons should be read with Dragon Mining Limited, in the matter of Dragon Mining Limited [2026] FCA 934 (Dragon Mining (No 1)) and will use the defined terms adopted in that decision.

2    In Dragon Mining (No 1), I made orders that Dragon Mining convene and hold a Scheme Meeting and made various directions under s 1319 of the Corporations Act 2001 (Cth). Pursuant to s 411(4) of the Corporations Act, a scheme of arrangement is binding on the members of a corporation, or a class of such members, if at a meeting convened in accordance with an order of the Court under s 411(1), a resolution is passed by the necessary majority provided for in s 411(4)(a)(ii) and if the arrangement is approved by an order made under s 411(4)(b).

3    The Scheme Meeting took place on 6 August 2026, and a resolution was passed in favour of the Scheme.

4    A hearing took place before me today, 13 August 2026 (second hearing), at which time the Court's approval for the Scheme was sought. At that hearing, Dragon Mining sought to rely on further affidavit evidence. After considering that evidence, the written submissions that were filed in advance of the second hearing, and the brief oral submissions that were made by senior counsel for Dragon Mining, I made an order under s 411(4)(b) of the Corporations Act approving the Scheme.

5    These are my reasons for making that order and the other ancillary orders sought by Dragon Mining.

The evidence

6    Dragon sought to rely on the same evidence upon which it relied in Dragon Mining (No 1). However, it also adduced further affidavit evidence.

7    The first additional affidavit upon which Dragon Mining relied was an affidavit sworn on 7 August 2026 by Brett Robert Smith, an Executive Director and the Chief Executive Officer of Dragon Mining. Mr Smith is also a Director of Dragon Gold. Mr Smith chaired the Scheme Meeting that was held on 6 August 2026 and gave evidence in his affidavit about the conduct of that meeting.

8    After the Scheme Meeting, Mr Smith was informed that the resolution put at the Scheme Meeting, which was to the effect that the Scheme be agreed to, was approved by 47 Dragon Mining Shareholders, being 100% in number of the Dragon Mining Shareholders who were present and voting on the resolution (either in person or by proxy) and had been approved by 56,689,990 votes, being 100% of the votes cast on the resolution (either in person or by proxy).

9    According to Mr Smith, Dragon Mining announced the outcome of the Scheme Meeting to the HKEX on 6 August 2026, and a copy of that announcement was attached to his affidavit.

10    Mr Smith also gave evidence in his affidavit about the fact that an extraordinary general meeting took place following the Scheme Meeting, which he also chaired. At that meeting a resolution was passed to the effect that, subject to the Scheme becoming effective in accordance with s 411(10) of the Corporations Act and certain other conditions being satisfied, the share capital of Dragon Mining be reduced upon the implementation of the Scheme by cancelling all shares on issue in consideration of Dragon Mining transferring to Dragon Mining Shareholders shares in Dragon Gold in accordance with the Scheme.

11    In his affidavit, Mr Smith also gave evidence that no one had raised any concerns with him about the dispatch of the scheme booklet.

12    In addition to the affidavit of Mr Smith, Dragon Mining relied on an affidavit sworn on 11 August 2026 by Daniel Karl Broughton, the Chief Financial Officer of Dragon Mining. In that affidavit Mr Broughton gave evidence that copies of various documents were announced to the HKEX on 29 June 2026, including copies of the final scheme booklet, notices of the Scheme Meeting and the extraordinary general meeting, proxy forms for those meetings, and correspondence sent to Dragon Mining Shareholders about the Scheme Meeting. Mr Broughton also gave evidence about other announcements Dragon Mining had made to the HKEX between 29 June 2026 and the date of the Scheme Meeting, and about how those announcements were made available to Dragon Mining Shareholders. Amongst those announcements was one made on 29 June 2026, which contained online links to several documents relating to the Scheme, including the independent expert report.

13    Mr Broughton gave further evidence in his affidavit about Dragon Mining's use of a shareholder phone information line for answering any questions Dragon Mining Shareholders may have had about the Scheme. According to Mr Broughton, no calls or voicemails were received on that information line in relation to the Scheme prior to the Scheme Meeting.

14    Attached to Mr Broughton's affidavit was an email from Dragon Mining's secretarial department, which summarised the voter turnout for its annual general meetings from 2022 to 2026. That summary indicated that the voter turnout for the Scheme Meeting was larger than the biggest turnout at any of those general meetings.

15    Finally, Mr Broughton attested that he was not aware of any objection or proposed objection to the Scheme or of any concerns about the Scheme having been raised by any Dragon Mining Shareholder.

16    Dragon Mining relied on two further affidavits sworn by Robyn Anne Ferguson, a partner of HopgoodGanim Lawyers, who are the solicitors for Dragon Mining. Ms Ferguson has carriage of this matter on behalf of Dragon Mining.

17    In her affidavit sworn on 10 August 2026 (fifth Ferguson affidavit) Ms Ferguson gave evidence that the Court's orders of 23 June 2026 (23 June orders) were lodged with ASIC on that same day. Further, a copy of the scheme booklet that was approved by the Court on 23 June 2026, together with copies of extracted pages taken from the booklet showing minor amendments that had been made after 23 June 2026, were provided to ASIC on 27 June 2026. The final scheme booklet was also provided to ASIC on 27 June 2026. Then, ASIC advised Ms Ferguson on 29 June 2026 that the final scheme booklet had been registered pursuant to s 412(6) of the Corporations Act.

18    Ms Ferguson gave further evidence that certain amendments had been made to the SID, the Scheme and to the deed poll executed by Dragon Gold in favour of Dragon Mining Shareholders. According to Ms Ferguson, those amendments were reflected in the final scheme booklet.

19    Ms Ferguson also gave detailed evidence in her affidavit concerning the way the scheme booklet and other scheme documents had been dispatched to Dragon Mining Shareholders, and evidence concerning the delivery and receipt of proxy forms. Ms Ferguson said that she was not aware of any complaints or concerns from any Dragon Mining Shareholders that they had not receive any of the Scheme documents. She also gave evidence that she had not received any information from anyone involved in the dispatch of the Scheme documents to suggest that there were any problems associated with the dispatch of those materials.

20    Annexed to the fifth Ferguson affidavit was a copy of a notice of the second hearing that was published on the HKEX Market Announcement Platform and on Dragon Mining's own website on 6 August 2026.

21    In her affidavit that was sworn on 13 August 2026 (sixth Ferguson affidavit), Ms Ferguson gave evidence that copies of the affidavits, outline of written submissions and minute of proposed orders upon which Dragon Mining sought to rely at the second hearing were provided to ASIC between 10 and 12 August 2026. She also said that she intended to provide ASIC with a copy of the sixth Ferguson affidavit.

22    Ms Ferguson also gave evidence in the sixth Ferguson affidavit that, after the Scheme Meeting had taken place, Dragon Mining received an email from a person who purported to be a Dragon Mining Shareholder. Two questions were raised in that email. One concerned when trading in Dragon Mining Shares would be suspended and the second was concerned with certain references to the 'placement price September 2025' that appeared in the Scheme documents. Those questions were responded to on 11 August 2026. However, Ms Ferguson says that neither the name of the person who sent the email nor the email address that was used appears in Dragon Mining's list of shareholders.

23    Annexed to the sixth Ferguson affidavit is a letter from ASIC dated 12 August 2026, in which there is a statement of no objection for the purposes of s 411(17)(b) of the Corporations Act. Also annexed to the sixth Ferguson affidavit are conditions precedent certificates provided by Dragon Mining and by Dragon Gold, indicating that certain conditions set out in the SID and the Scheme have been satisfied or waived. Ms Ferguson also noted that implementation of the Scheme is conditional on both the Scheme becoming effective and the HKEX granting unconditional approval for the listing of Dragon Gold on the HKEX by way of introduction, and permission to deal in, the Dragon Gold shares that will be issued to Dragon Mining Shareholders as part of the Scheme. In that regard, Ms Ferguson has been informed by Dragon Mining's Hong Kong solicitors, and she believes, as at 13 August 2026, those solicitors are not aware of any fact, matter or circumstance that has resulted in, or is likely to result in, the failure of Dragon Gold's proposed listing on the HKEX.

24    Finally, Ms Ferguson said in the sixth Ferguson affidavit that she was not aware that any Dragon Mining Shareholder, or other person, has complained or raised any objections as to the convening or conduct of the Scheme Meeting or that they sought to appear at the second hearing to object to the Scheme.

The relevant principles

25    I have previously referred to and adopted Moshinsky J's summary of the relevant principles in Envirosuite Limited, in the matter of Envirosuite Limited (No 2) [2025] FCA 941 at [10] to [11]:

In approving a scheme of arrangement, the role of the Court is supervisory, requiring the Court to be satisfied that there has been no oppression and that the compromise or arrangement is one that is capable of being accepted by shareholders looking to their own commercial advantage. In Re NRMA Ltd (No 1) [2000] NSWSC 82; 156 FLR 349 (Re NRMA Ltd) at [41], Santow J quoted with approval the following passage from Renard IA and Santamaria JG, Takeovers and Reconstructions in Australia (Butterworths, Sydney, 1990, loose-leaf), at 15,061:

'... the court will determine: (1) whether all the conditions required by s 411 have been complied with; (2) whether the majority of members or creditors, though acting regularly, have acted in good faith and not in pursuit of some illegitimate purpose; and (3) whether the proposal was "at least so far fair and reasonable, as that an intelligent and honest man, who is a member of that class, and acting alone in respect of his interest as such member, might approve it".* Fundamentally, the jurisdiction is supervisory; the court is concerned to be satisfied that there has been an absence of oppression and that the compromise or arrangement is one which is capable of being accepted: see Re Dorman Long & Co Ltd [[1934] Ch 635]; Scottish Insurance Corp Ltd v Wilsons and Clyde Coal Co Ltd [1949] AC 462 at 486.

* Per Fry LJ in Re Alabama, New Orleans, Texas and Pacific Junction Railway Co [1891] 1 Ch 213 at 247.'

In deciding whether to give final approval to a scheme of arrangement, the Court will typically wish to be satisfied of the following matters:

(a)    that the orders of the Court convening a meeting of members were complied with;

(b)    that the meeting of members so convened has approved the scheme with the requisite majority;

(c)    that all the statutory requirements have been complied with;

(d)    that the majority of members have acted in good faith and not for any illegitimate purpose;

(e)    that there is no suggestion of oppression of any minority;

(f)    that the scheme is fair and reasonable so that an intelligent and honest person, who is a member and acting alone in respect of his or her interest as a member, might approve it;

(g)    that there was full and fair disclosure to members of all information material to the decision whether to vote for or against the scheme; and

(h)    that 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.

(citations omitted)

Formal requirements

Lodgment of orders and registration of the scheme booklet

26    The fifth Ferguson affidavit established that the 23 June orders, and the scheme booklet as approved by the Court (together with minor amendments made after that date), were lodged with ASIC on 23 and 27 June 2026, respectively.

Dispatch of the scheme booklet

27    The fifth Ferguson affidavit, and Ms Ferguson's evidence given on the basis of information or belief, as permitted by the 23 June orders, also established that the scheme booklet was dispatched in accordance with those orders.

Advertising of hearing

28    The 23 June orders required that Dragon Mining publish an announcement via the HKEX Market Announcements Platform and on its website in substantially the form set out at 'Annexure A' to those orders by no later than 6 August 2026. I was satisfied, based on the fifth Ferguson affidavit, that this order was complied with.

Conduct of Scheme Meeting

29    Based on Mr Smith's Affidavit sworn on 7 August 2026, I was satisfied that the Scheme Meeting was conducted in accordance with the 23 June orders.

Scheme approved by the requisite majorities

30    The Scheme was passed by the requisite majorities provided for in s 411(4)(a)(ii) of the Corporations Act. As I have already noted, Mr Smith's evidence is that the Scheme was agreed to by 100% in number of the Dragon Mining Shareholders present and voting at the Scheme Meeting (either in person or by proxy) and by 100% of the votes cast at that meeting (either in person or by proxy).

31    These results were announced to the market via the HKEX on 6 August 2026.

32    In total, 29.88% of the total number of Dragon Mining shares on issue were voted by just 6.62% of the total number of Dragon Mining Shareholders. However, 'low shareholder turnout does not prevent the Court from making orders approving a scheme of arrangement': Allkem Limited, in the matter of Allkem Limited (No 2) [2023] FCA 1657 at [20]. As I have already said, the voting participation rate at the Scheme Meeting was greater than the participation rate experienced at Dragon Mining's annual general meetings over the past five years. There is also nothing to suggest that the low shareholder turnout in this case occurred because there were any issues with the dispatch of the scheme booklet or that Dragon Mining Shareholders were improperly deterred from attending or voting at the Scheme Meeting.

Satisfaction of conditions precedent

33    As I have already said, Ms Ferguson's evidence was that two conditions precedent certificates were executed by Dragon Mining and Dragon Gold, respectively, confirming that certain conditions in the SID and in the Scheme have been satisfied or waived.

Discretionary considerations

Good faith and proper purpose

34    There was no evidence, and it was not suggested by anyone seeking to appear at the second hearing, that Dragon Mining Shareholders voted at the Scheme Meeting otherwise than in good faith and for a proper purpose. An independent expert also concluded that the Scheme was fair and reasonable and in the best interests of Dragon Mining Shareholders, in the absence of a superior proposal.

35    I accepted the submission made by senior counsel on behalf of Dragon Mining that transactions of the nature of this Scheme are ordinarily approved by courts and are of a kind which sensible businesspeople might consider to be of benefit to members: Advanced Share Registry Limited, in the matter of Advanced Share Registry Limited (No 2) [2023] FCA 1560 at [24].

Fair and reasonable scheme

36    I was satisfied that the Scheme is fair and reasonable such that an intelligent and honest securityholder, properly informed and acting alone, might approve it: Seven Network Limited (ACN 052 816 789), in the matter of Seven Network Limited (No 3) [2010] FCA 400 at [36]; citing Fowler v Lindholm [2009] FCAFC 125; (2009) 178 FCR 563 at [79]. In that regard, I note that the requisite majorities approved the Scheme and that this is prima facie evidence that the Scheme is fair: Amcor Limited, in the matter of Amcor Limited (No 2) [2019] FCA 842 at [11]. Further, the author of the independent expert report that was attached to the scheme booklet opined that the terms of the Scheme are fair and reasonable and, in the absence of a superior proposal, the Scheme is in the best interests of Dragon Mining Shareholders. The Scheme was also unanimously recommended by the directors of Dragon Mining, in the absence of a superior proposal and while the independent expert maintained its opinion. In that regard, there was no evidence of a superior proposal or that the opinion of the independent expert had changed.

Full and fair disclosure

37    I was satisfied, as I was in Dragon Mining (No 1), that there had been full and fair disclosure to Dragon Mining Shareholders. There was no evidence at the second hearing that altered my view. The evidence that a person who purported to be a Dragon Mining Shareholder had sent an email after the Scheme Meeting did not raise in my mind any question about whether there had been full and fair disclosure to Dragon Mining Shareholders.

Satisfaction of s 411(17) of the Corporations Act

38    I was satisfied, based on the letter from ASIC dated 12 August 2026, which was attached to the sixth Ferguson affidavit, that for the purposes of s 411(17)(b) of the Corporations Act, it had no objection to the Scheme, having regard to its criteria for providing a statement in writing that it has no objection as set out in ASIC Regulatory Guide 60 - Schemes of arrangement.

Public policy and oppression of minorities

39    There was no evidence that any minority Dragon Mining Shareholders were oppressed or that the Scheme offended public policy.

Other relevant matters

40    In his oral submissions, senior counsel for Dragon Mining drew the Court's attention to the email that was received by Dragon Mining after the Scheme Meeting from someone who purported to be a Dragon Mining Shareholder. I have already said that this communication did not cause me any concern as to whether there had been full and fair disclosure to Dragon Mining Shareholders. That email, and the subsequent reply from Dragon Mining, also did not cause me to have any other relevant concerns. In that regard I note that the evidence before the Court is that the person who sent the email was not a Dragon Mining Shareholder.

41    As I noted in Dragon Mining (No 1) at [58], Dragon Mining wishes to rely on the Court's approval of the Scheme to qualify for an exemption under section 3(a)(10) of the Securities Act of 1933 (USA) from the registration requirements under that Act in connection with the issue and exchange of the consideration under the Scheme.

42    As Banks-Smith J noted in Allkem at [36], there are many examples of second court hearings for schemes where an issue about an exemption under section 3(a)(10) of the Securities Act of 1933 (USA) has arisen. Her Honour observed that the courts have proceeded on the basis that the exemption would be available if the court holds a hearing to determine whether the proposed terms and conditions of a scheme of arrangement are fair to those who receive securities. Her Honour also said that it is not for the Court to express any view as to whether its procedures or processes are sufficient to satisfy the requirements of the exemption, and that the Court does not act as the valuer of shares but is assisted by expert opinion on that matter. A standard approach has been adopted by the courts in relation to the exemptions, by noting particular matters: Allkem at [37].

43    Adopting that standard approach, I noted the following matters:

(1)    Dragon Mining previously advised this Court that it would be relying on the exemption in section 3(a)(10) of the Securities Act of 1933 (USA).

(2)    Dragon Mining previously advised this Court that Dragon Gold shares will be offered as consideration under the Scheme, and that an independent expert concluded that the Scheme is in the best interests of Dragon Mining Shareholders.

(3)    The second hearing was held in open court to consider the fairness and reasonableness of the Scheme, and it was open to any member of the public, including any Dragon Mining Shareholder, to attend and be heard at that hearing.

(4)    Notice of the second hearing was included in the scheme booklet prior and was advertised via the HKEX and on Dragon Mining's own website.

(5)    No Dragon Mining Shareholder had given notice of any intention to appear at the second hearing, and none appeared. Further, based on the most recent evidence of Ms Ferguson, Mr Smith and Mr Broughton, there was nothing to suggest Dragon Mining was aware of any objection or proposed objection to the Scheme.

44    In accordance with the usual practice of this Court, I made the following notations in the Court's orders approving the Scheme:

(1)    The orders or reasons for judgment as the basis of a claim to an exemption pursuant to section 3(a)(10) of the Securities Act of 1933 (USA) (as amended) (US Securities Act) from the registration requirements of the US Securities Act in connection with the issuance and exchange of all Scheme consideration pursuant to the Scheme based on the Court's approval of the Scheme.

(2)    The fact that the Scheme is consummated under the statutory provisions of the Corporations Act.

(3)    The fact that the Court held a hearing to consider the fairness and reasonableness of the terms and conditions of the Scheme and the Court has determined that the Scheme is fair and reasonable in the sense that an intelligent and honest shareholder, properly informed and acting alone might approve it.

Associate:

Dated:    13 August 2026