BENJAMIN HORNIGOLD LIMITED — M&A Activity 2019

May 30, 2019

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31 May 2019

ASX Limited 20 Bridge Street SYDNEY NSW 2000

Fax 1300 135 638

Dear ASX

John Bridgeman Limited off-market takeover bid for Benjamin Hornigold Limited – Second supplementary bidder's statement

We act for John Bridgeman Limited ACN 603 477 185 ( JBL ).

We attach by way of service under section 647(3)(b) of the Corporations Act 2001 (Cth) a copy of JBL’s second supplementary bidder’s statement to the bidder’s statement dated 3 May 2019.

Yours sincerely

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Ben Wood Partner

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Supplementary Bidder’s Statement

John Bridgeman Limited ACN 603 477 185

1 Introduction

This document is the second supplementary bidder’s statement ( Supplementary Bidder’s Statement ) to the bidder’s statement dated 3 May 2019 as supplemented by the first supplementary bidder’s statement dated 14 May 2019 ( Original Bidder’s Statement ) issued by John Bridgeman Limited ACN 603 477 185 ( JBL ) in relation to JBL’s off-market takeover bid for all of the ordinary shares and issued options in Benjamin Hornigold Limited ACN 614 854 045 ( BHD ).

This Supplementary Bidder’s Statement is given pursuant to Division 4 of Part 6.5 of the Corporations Act 2001 (Cth) ( Corporations Act ) in compliance with the requirements of section 643 Corporations Act.

The Supplementary Bidder’s Statement supplements and is to be read together with the Original Bidder’s Statement. This document prevails in the event of any inconsistency with the Original Bidder’s Statement.

This is an important document and requires your immediate attention.

If you are in any doubt about how to deal with this document, you should contact your legal, financial, tax or other professional advisor immediately.

1.1 Important notices

A copy of the Supplementary Bidder’s Statement was lodged with the Australian Securities and Investments Commission ( ASIC ) on 31 May 2019. Neither ASIC nor any of its officers take any responsibility for the contents of this Supplementary Bidder’s Statement.

1.2 Defined terms

Unless the context otherwise requires, capitalised terms in this Supplementary Bidder’s Statement have the same meaning given to them in section 13 of the Original Bidder’s Statement. The rules of interpretation set out in section 13.2 of the Original Bidder’s Statement also apply to the Supplementary Bidder’s Statement, unless the context otherwise requires.

2 Increase in Share Offer Consideration

2.1 Variation to Share Offer

As announced to the market on 28 May 2019, JBL has varied the Share Offer to provide that the Share Offer Consideration is now 1.5 JBL Shares for each BHD Share you own.

Any reference in the Original Bidder’s Statement to words to the effect of ‘1 JBL Share for each BHD Share you own’ is replaced with ‘1.5 JBL Shares for each BHD Share you own’.

53360988v2 | Supplementary bidder's statement – John Bridgeman Limited

2.2 What if I have already accepted the Share Offer?

If you have already accepted the Share Offer, you will be entitled to receive the improved Share Offer Consideration (that is, you will be entitled to receive 1.5 JBL Shares for each BHD Share you own) in accordance with section 650B(2) Corporations Act.

2.3 When will I receive the improved Share Offer Consideration?

You will be entitled to receive the improved Share Offer Consideration at the time determined in accordance with section 620(2) Corporations Act and as set out in clause 5 of Schedule 1 of the Original Bidder’s Statement.

2.4

Updated substantial holder information

Section 5.2 of the Original Bidder’s Statement is amended by deleting the tables titled ‘JBL substantial holders – JBL acquires 50.1% of BHD’ and ‘JBL substantial holders – JBL acquires 100% of BHD’, and replacing them with the tables set out below:

JBL substantial holders – JBL acquires 50.1% of BHD

Substantial holder	Interest	Substantial holding
Stuart McAuliffe*	11.07%	5,945,492
John McAuliffe**	4.85%	2,606,000
Stuart Capital Pty Ltd	14.32%	7,687,819
*The following substantial holders are duplicates, being the relevant interests of entities controlled by Stuart McAuliffe. These 5,945,492 shares are included in Stuart McAuliffe’s substantial holding disclosure.
Substantial holder	Interest	Substantial holding
Henry Avery Partners Pty Ltd	11.07%	5,945,492
John Hawkins Pty Ltd	11.07%	5,945,492
**The following substantial holder is a duplicate, being the relevant interests of an entity controlled by John McAuliffe. These 2,606,000 shares are included in John McAuliffe’s substantial holding disclosure.
Substantial holder	Interest	Substantial holding
Tetue Pty Ltd	4.85%	2,606,000

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JBL substantial holders – JBL acquires 100% of BHD

Substantial holder		Interest	Substantial holding
Stuart McAuliffe*		8.29%	5,945,492
John McAuliffe**		3.63%	2,606,000
Stuart Capital Pty Ltd		10.72%	7,687,819
*The following substantial holders are duplicates, being the relevant interests of entities
controlled by Stuart McAuliffe.	These 5,945,492 shares are included in Stuart McAuliffe’s
substantial holding disclosure.
Substantial holder		Interest	Substantial holding

Substantial holder		Interest	Substantial holding
Henry Avery Partners Pty Ltd		8.29%	5,945,492
John Hawkins Pty Ltd		8.29%	5,945,492
**The following substantial holder is a duplicate, being the relevant interests of an entity
controlled by John McAuliffe.	These 2,606,000 shares are included in John McAuliffe’s
substantial holding disclosure.
Substantial holder		Interest	Substantial holding

Substantial holder	Interest	Substantial holding
Tetue Pty Ltd	3.63%	2,606,000

2.5 Updated number of JBL Shares

Section 5.8 of the Original Bidder’s Statement is deleted and replaced with the following:

The maximum number of JBL Shares which are required to be issued under the Share Offer if acceptances are received for all the BHD Shares on issue at the date of this Bidder’s Statement is approximately 36,164,823 (excluding rounding adjustments).

While not anticipated, if all BHD Optionholders convert their BHD Options into BHD Shares before the end of the Offer Period and accept the Share Offer, an additional 25,012,284 JBL Shares would be required to be issued (excluding rounding adjustments).

JBL Shares issued under the Share Offer are exempt from NSX Listing Rule 6.25(1) (which prohibits issues exceeding 15 percent of a company’s share capital in any 12 month period). Accordingly, JBL has the capacity to issue the maximum number of JBL Shares that may be required under the Share Offer.

2.6 Updated Pro Forma Balance Sheets

The Annexure to this Supplementary Bidder’s Statement contains updated pro forma financial information of JBL and BHD as at 31 December 2018, to reflect the updated Share Offer Consideration, and which otherwise incorporates the balance sheet of HML, as if JBL’s acquisition of a Relevant Interest in 46.28% of HML had taken place as at that date. These Pro Forma Balance Sheets are prepared on the basis set out in section 7.4 of the Original Bidder’s Statement.

3 Application for preliminary discovery

On 29 May 2019, JBL filed an application for preliminary discovery against the NSX under rule 7.23 of the Federal Court Rules 2011 (Cth) ( Application ). The Application seeks copies of

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documents relating to, or leading to, the decision by the NSX to suspend trading in JBL’s securities on 10 April 2019.

JBL will provide further information regarding the Application as it becomes available to JBL.

4 Approval of the Supplementary Bidder’s Statement

The Supplementary Bidder’s Statement has been approved by a unanimous resolution of the directors of JBL.

This Supplementary Bidder’s Statement is dated 31 May 2019, which is the date it was lodged with ASIC.

John McAuliffe Chairman John Bridgeman Limited

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Annexure

Pro Forma Balance Sheets

Pro Forma Balance Sheet (including HML) assuming JBL acquires 50.1% of BHD

		John Bridgeman Limited (JBL)	Henry					Consolidation eliminations	Consolidation eliminations	Consolidation eliminations	Consolidation eliminations	Consolidation eliminations	Consolidation eliminations	Consolidation eliminations	Consolidation eliminations	Consolidation eliminations		John Bridgeman Limited (JBL)
			Morgan	Benjamin
			Limited (HML)	Hornigold Limited (BHD)		JBL Capital issued on purchase of HML	JBL Capital issued on purchase of BHD
		Pre-acquisition consolidated BS						JBL investment in HML & BHD	HML investment in JBL	BHD investment in JBL	HML investment in BHD	HML investment in JB Financial Group	HML to JBL loan	Intercompany transactions	Foreign currency bank notes	Mgmt fee and broker fee payable		Post-acquisition consolidated BS
Assets		31 Dec 2018																31 Dec 2018
Current assets								23,609,204 (147,956) (149,154) 2,553,188 2,579,483 45,999 74,906 732,833 147,026 (977,314) 1,314,682
Cash and cash equivalents 19,359,871 1,415,763 2,833,570
Trade and other receivables 2,850,298 -
Balances held with brokers 2,464,596 6,932 107,955
Inventory 45,999 -
Derivative financial assets 42,520 - 32,386
Term deposits 732,833 -
Purchased debt ledgers 147,026 -
Other current assets 1,083,863 204,152 1,003,981
Total current assets 26,727,006 1,626,847 3,977,892								31,057,321
Non-current assets								(20,926,684) 0 (33,000) (25,800) (48,308) (30,027,597) (2,412,301) (1,824,430) 336,453 5,320,403 50,463,284 11,415,338 348,624 887,749 (2,464,729) (5,504,620) 40,288
Investment in subsidiary - - 12,892,176 8,034,508
Investments at fair value through profit and loss 3,570,191 30,108,905 4,262,531 (3,196,734) (37,004)
Property, plant and equipment 5,320,403 -
Intangibles 42,798,044 - 7,665,240
Deferred tax 8,975,614 - 2,439,724
Purchased debt ledgers 348,624 -
Security deposits 887,749 -
Loans & other receivables - 2,464,729 5,544,908
Total non- current assets 61,900,625 32,573,634 12,247,163								68,812,139
Total assets 88,627,631 34,200,481 16,225,055								99,869,460
								(290,947) (1,824,430) (149,154) 17,059,829 (834,323) 2,695,798 792,279 1,018,149
Liabilities
Current liabilities
Trade and other payables 18,785,362 280,265 258,733
Borrowings 3,530,121 -
Income tax 587,613 207,398 (2,732)
Provisions 1,018,149 -
Total current liabilities 23,921,245 487,663 256,001								21,566,055
Non-current liabilities								265,255 (2,464,729) (7,916,921) 11,195,553
Payables 265,255 -
Borrowings 21,577,203 -

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Annexure – Pro Forma Balance Sheets

Derivative financial instruments	556,079 - 5,973 2,659,495 1,114,635 676,625 -	562,052
Deferred tax		3,774,130
Provisions		676,625
Total non- current liabilities	25,734,657 1,114,635 5,973	16,473,615
Total liabilities	49,655,902 1,602,298 261,974	38,039,670
Net assets	38,971,729 32,598,183 15,963,081	61,829,790
Equity	20,875,481 32,614,781 23,528,129 9,695,442 15,662,744 (56,142,910) (10,263,130) - 9,738,905 (33,000) (25,800) (48,308) (21,462,730) (8,226,750) (16,598) (7,565,048)
Issued capital		46,233,666
Reserves		(22,094,062)
Accumulated losses		(15,808,396)
Equity attributable to the owners	2,385,601 32,598,183 15,963,081 36,586,128 - - 25,477,321 (8,564,867)	8,331,208
Non-controlling interest		53,498,582
Total equity	38,971,729 32,598,183 15,963,081	61,829,790

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Annexure – Pro Forma Balance Sheets

Pro Forma Balance Sheet (including HML) assuming JBL acquires 100% of BHD

	John Bridgeman Limited (JBL)	Henry	Benjamin					Consolidation eliminations											John Bridgeman Limited (JBL)
		Morgan	Hornigold
		Limited (HML)	Limited (BHD)			JBL Capital issued on purchase of HML	JBL Capital issued on purchase of BHD
	Pre-acquisition consolidated BS							JBL investment in HML & BHD	HML investment in JBL	BHD investment in JBL	HML investment in BHD	HML investment in JB Financial Group	HML to JBL loan	Intercompany transactions	Foreign currency bank notes	Mgmt fee and broker fee payable			Post- acquisition consolidated BS
Assets	31 Dec 2018																		31 Dec 2018
Current assets								23,609,204 (147,956) (149,154) 2,553,188 2,579,483 45,999 74,906 732,833 147,026
Cash and cash equivalents 19,359,871 1,415,763 2,833,570
Trade and other receivables 2,850,298 -
Balances held with brokers 2,464,596 6,932 107,955
Inventory 45,999 -
Derivative financial assets 42,520 - 32,386
Term deposits 732,833 -
Purchased debt ledgers 147,026 -
Other current assets 1,083,863 204,152 1,003,981								(977,314)										1,314,682
Total current assets 26,727,006 1,626,847 3,977,892																		31,057,321
Non-current assets								(28,833,445) 0 (33,000) (25,800) (48,308) (30,027,597) (2,412,301) (1,824,430) 336,453 5,320,403 58,156,741 11,415,338 348,624 887,749
Investment in subsidiary - - 12,892,176 15,941,269
Investments at fair value through profit and loss 3,570,191 30,108,905 4,262,531 (3,196,734) (37,004)
Property, plant and equipment 5,320,403 -
Intangibles 42,798,044 - 15,358,697
Deferred tax 8,975,614 - 2,439,724
Purchased debt ledgers 348,624 -
Security deposits 887,749 -
Loans & other
receivables - 2,464,729 5,544,908								(2,464,729) (5,504,620)										40,288
Total non-current
assets 61,900,625 32,573,634 12,247,163																		76,505,596
Total assets 88,627,631 34,200,481 16,225,055								107,562,917
								(290,947) (1,824,430) (149,154) 17,059,829 (834,323) 2,695,798 792,279
Liabilities
Current liabilities
Trade and other payables 18,785,362 280,265 258,733
Borrowings 3,530,121 -
Income tax 587,613 207,398 (2,732)
Provisions 1,018,149 -																		1,018,149
Total current liabilities 23,921,245 487,663 256,001								21,566,055
Non-current liabilities								265,255 (2,464,729) (7,916,921) 11,195,553 562,052 3,774,130
Payables 265,255 -
Borrowings 21,577,203 -
Derivative financial instruments 556,079 - 5,973
Deferred tax 2,659,495 1,114,635

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Annexure – Pro Forma Balance Sheets

Provisions	676,625 -	676,625
Total non-current liabilities	25,734,657 1,114,635 5,973	16,473,615
Total liabilities	49,655,902 1,602,298 261,974	38,039,670
Net assets	38,971,729 32,598,183 15,963,081	69,523,247
Equity	20,875,481 32,614,781 23,528,129 9,695,442 31,262,961 (56,142,910) (10,263,130) - 7,142,805 (33,000) (25,800) (48,308) (24,949,404) (8,226,750) (16,598) (7,565,048) 2,654,917
Issued capital		61,833,884
Reserves		(28,176,838)
Accumulated losses		(13,153,479)
Equity attributable to the owners	2,385,601 32,598,183 15,963,081 36,586,128 - - 17,511,744 (5,078,193)	20,503,567
Non-controlling interest		49,019,679
Total equity	38,971,729 32,598,183 15,963,081	69,523,247

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