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Silver Fern Farms’ Response to Requsition

SILVER FERN FARMS’ RESPONSE TO REQUSITION FOR SHAREHOLDER MEETING

On 13 April, Silver Fern Farms received a requisition led by Mr John Shrimpton and Mr Blair Gallagher, representing a group of 80 shareholders. The requisition is for the Board of Silver Fern Farms to call a special meeting of shareholders to consider the following resolution:

“Resolution: as a Special Resolution:

That the shareholders of Silver Fern Farms Limited (the Company) hereby approve the proposed partnership of the Company with Shanghai Maling and the restructure described in the Notice of Meeting and Shareholder Information Pack dated 28 September 2015 by way of this special resolution of shareholders.”

Shareholders together representing at least 5% of shares carrying eligible voting rights on the matter to be considered may requisition a meeting of shareholders.

Since its receipt, the Company has been through the process of validating the requisition and the voting rights of the shares represented.

Mr Shrimpton had indicated that he wished to meet with the Board, and indeed the Board wished to meet with Messrs Shrimpton and Gallagher to understand and discuss what legal justification is claimed for the requisition and the motivations of the requisitioners. Having previously agreed to meet on 2 May, late last week Mr Shrimpton notified the Company that he no longer wished to meet.

Mr Shrimpton has advised that “it is considered that the Proposed Transaction has not been properly approved by the Company’s shareholders. The purpose of the Requisition then is to provide the opportunity for the Company’s shareholders to meet at a special general meeting in order to consider and vote on the special resolution which is specified in the Requisition in order to approve the Proposed Transaction.

It is your Board’s clear view that:

• The investment by Shanghai Maling was approved by Silver Fern Farms Limited’s shareholders in compliance with all relevant laws, regulations and the Company’s constitution. The Board took extensive external professional advice throughout the process.

• As set out in the September 2015 Notice of Meeting and Shareholder Information Pack on the proposed partnership and discussed in a nationwide roadshow of 23 shareholder meetings, the Board unanimously supported the Shanghai Maling investment as providing a game changing opportunity for our business.

• All qualifying shareholders were entitled to vote, there was a significant and representative turnout (2879 shareholders voted on the resolution representing over 67% of eligible voting rights), and 82% of the votes cast at that meeting supported the proposal. The Board appreciates the strong support provided by shareholders.

• The Company is legally bound to complete the investment as approved by shareholders in October last year once the remaining conditions are satisfied. There is no discretion, irrespective of any further shareholder meeting or its outcome. If the remaining conditions are satisfied, and the Company does not proceed to complete its side of the bargain, the Company will be in breach of contract.

• A resolution of the nature proposed will have no legal effect whether passed or not passed.

• The restructure by the Company has already been completed. The only substantive step remaining once conditions are satisfied is Shanghai Maling’s investment in new shares to be issued by the Company’s subsidiary.

• The merits of this transaction have, if anything, increased in the period since the vote.

The Board considers that convening a meeting along the lines requisitioned is of no benefit to the Company or its shareholders and is not an effective use of the Company’s management and financial resources. It risks being disruptive to satisfaction of the remaining conditions to the investment by Shanghai Maling, to the relationship with Shanghai Maling, and ultimately to the Company itself, our shareholders and shareholder value.

Despite the above, the Board has resolved to proceed with the steps required to call the requested meeting in accordance with the Companies Act and corresponding requirements of the Company’s constitution.. The Company will continue to keep shareholders advised, including as to timing for that meeting.

The Board, again unanimously, urges Mr Shrimpton and his colleagues to withdraw the call for a special meeting, for the reasons stated above, and reiterates its support for the Shanghai Maling transaction as being in the best interests of the Company and its shareholders.

The Board will continue to make itself available to meet and discuss these matters with Mr Shrimpton and his colleagues.

ENDS

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