Ann: WAV/RULE: MET: MET - Waiver from Listing Rul

• Release Date: 02/10/12 20:09
• Summary: WAV/RULE: MET: MET - Waiver from Listing Rule 7.6.4(b)(iii)
• Price Sensitive: No
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MET
02/10/2012 17:09
WAV/RULE

REL: 1709 HRS Metlifecare Limited

WAV/RULE: MET: MET - Waiver from Listing Rule 7.6.4(b)(iii)

NZX Regulation Decision
Metlifecare Limited
Application for Waiver from NZSX Listing Rule 7.6.4(b)(iii)

Background

1. Metlifecare Limited ("MET") is a Listed Issuer with ordinary shares
("Shares") quoted on the NZX Main Board.

2. MET is proposing to establish an employee share plan (the "Plan") for
selected senior employees ("Participants"). As part of the Plan, MET will
provide an interest free loan to Participants which must be used for the
purpose of acquiring shares ("Plan Shares"). The Plan Shares will be held by
a trustee ("Trustee") on behalf of each Participant in the Plan.

3. The transfer of legal title in Plan Shares to the Participant is subject
to the Participant's continued employment for a specified period and certain
exercise hurdles ("Exercise Hurdles") being met. To the extent that legal
title is transferred to a Participant in accordance with the terms of the
Plan, the Participant will be paid a bonus which, after tax the Participant
directs MET to apply to repaying the amount of the Participant's loan balance
in respect of the relevant Plan Shares.

4. To the extent that legal title in Plan Shares is not to be transferred to
a Participant, the Trustee holds put and call options in respect of the
Participant's beneficial interest in the relevant Plan Shares. The
consideration payable by the Trustee on exercise of the put or call option
will be an amount equal to the Participant's loan balance in respect of the
relevant Plan Shares. Participants authorise and direct the Trustee to apply
the consideration towards repayment of their outstanding loan balance.

5. MET wishes to make an offer to its Chief Executive Offer, Mr Alan Edwards,
who is also a Director of MET, to participate in the Plan.

6. NZSX Listing Rule ("Rule") 7.6.4(b)(iii) provides that an Issuer may,
subject to compliance with certain monetary thresholds, provide financial
assistance for the purpose of, or in connection with, the acquisition of
Equity Securities, provided that the financial assistance is not given to any
Director of the Issuer or any Associated Person of a Director.

Application

7. MET has applied to NZX Regulation ("NZXR") for a waiver from Rule
7.6.4(b)(iii) so that MET, may provide financial assistance to Mr Edwards (a
Director of MET) as a Participant in the Plan.

8. In support of its application MET makes the following submissions:

(a) The alternative to the granting of a waiver would be to seek the approval
of shareholders under Rule 7.6.5. MET considers that the cost of a
shareholder meeting outweighs the benefit to shareholders of such a meeting;

(b) MET is unlikely to be able to extend the offer to Mr Edwards in the
absence of a waiver or shareholder meeting. A key reason for offering the
Plan is to align the interests of a number of senior employees with those of
MET's shareholders. It would be inconsistent with this purpose for the Chief
Executive Officer's interests not to be aligned;

(c) The footnote to Rule 7.6.4 provides that NZX may waive the restriction in
Rule 7.6.4(b)(iii) where:

(i) The assistance is given to bona fide full time employees who are
Directors;

(ii) NZX is satisfied that amounts and terms of the assistance will be
determined according to criteria applying generally to all employees eligible
to receive the assistance and would not, if all relevant factors were
publicly disclosed, be seen as materially influenced by the relationship; and

(iii) NZX is satisfied that the assistance is not likely disproportionately
to affect the persons controlling the Issuer and those associated with them.

(d) The criteria set out in paragraph (c) are satisfied in respect of the
Plan as:

(i) All Participants under the Plan will be provided with financial
assistance, irrespective of their position;

(ii) The policy of Rule 7.6.4(b)(iii) is to ensure that Directors do not
exercise their discretion or use their position to obtain financial
assistance which unfairly advantages the Director to the detriment of
shareholders and which is not consistent with the financial assistance given
to employees who are not Directors;

(iii) The terms of the Plan have been determined by MET's Remuneration
Committee and approved by MET's board (excluding Mr Edwards);

(iv) The specific employees to whom offers will be made and the quantum of
financial assistance to be provided to selected employees (including Mr
Edwards) will be determined by reference to each employee's relative base
salaries and/or by reference to achievement of formal individual sales
targets;

(v) The level of assistance provided to Mr Edwards under the Plan reflects
the importance of the Chief Executive Officer's role, the additional risks
inherent in the role of the Chief Executive Officer of a company of the size
and complexity of MET, and the importance to MET in retaining Mr Edwards and
incentivizing him to remain with MET, particularly in light of MET's recent
acquisitions. The actual level of Mr Edwards' financial assistance in each
year will be determined by the Remuneration Committee and the Board
(excluding Mr Edwards);

(vi) Mr Edwards will also not participate in any discussions of MET's Board
as to whether performance hurdles have been met or whether Plan Shares should
be awarded where the required Exercise Hurdles have not been met;

(e) The expected number of Plan Shares that will be issued under the Plan
represents approximately 0.12% of MET's Shares. Additionally, the amount of
the loan and bonus expected to be granted to Mr Edwards each year will be for
only approximately 0.05% of MET's Shares annually. There would be no
implications from a control perspective. As such, the assistance will not
disproportionately affect the persons controlling MET and their associates -
Mr Edwards is not associated with any substantial security holders in MET;

(f) It is in the interests of all shareholders of MET that the interests of
Mr Edwards (as Chief Executive Officer) be as closely aligned with their
interests as possible. Assisting Mr Edwards in that respect should not be
unfairly restricted;

(g) MET shareholders and prospective investors will be aware of the value of
the financial assistance being provided to Mr Edwards under the Plan, because
MET is required by section 79 of the Companies Act 1993 to send to each MET
shareholder a disclosure document setting out details of the financial
assistance to be given in connection with the acquisition of the Plan Shares,
before that financial assistance is given and Mr Edwards is required by the
Securities Markets Act 1988 to disclose details (including the price) of any
Plan Shares acquired by him. In addition, MET is required to disclose
remuneration levels generally. Shareholders will be aware of the terms of the
Plan, together with Mr Edwards participation, and will be able to make
appropriately informed investment decisions as a result of that information;
and

(h) There have been a number of other analogous waivers previously granted by
NZXR, including to:

(i) Heartland New Zealand on 10 August 2012
(ii) Abano Healthcare Group Limited on 7 October 2011;
(iii) Ryman Healthcare Limited on 15 June 2010;
(iv) Steel & Tube Holdings Limited on 23 October 2009;
(v) Nuplex Industries Limited on 15 September 2009; and
(vi) Contact Energy Limited on 23 July 2009.

Rule 7.6.4(b)(iii)

9. Rule 7.6.4(b)(iii) provides that:

"An Issuer may give financial assistance of the nature referred to in Rule
7.6.3 if:
....

(b)  the financial assistance is given to Employees (as defined in Rule
7.3.6) of the Issuer and:

(i)  the amount of the financial assistance, together with the amount of all
other financial assistance given under this paragraph (b) by the Issuer
during the shorter of the period of 12 months preceding the date of giving of
the financial assistance and the period from the date on which the Issuer was
Listed to the date of giving of the financial assistance, does not exceed 5%
of the Average Market Capitalisation of the Issuer; and

(ii)  the amount of the financial assistance, together with the amount of all
other financial assistance given under Rule 7.6.4(b)(i) during the shorter of
the period of five years preceding the date of the giving of financial
assistance and the period from the date on which the Issuer was Listed to the
date of the giving of the financial assistance, does not exceed 10% of the
Average Market Capitalisation of the Issuer; and

(iii)  the financial assistance is not given to any Director of the Issuer or
Associated Person of a Director; or"

10. The footnote to Rule 7.6.4 provides that:

"NZX may waive the restriction in Rule 7.6.4(b)(iii) on Directors and
Associated Persons participating in financial assistance given to Employees:

(a)  so far as it affects assistance given to bona fide full time employees
who are Directors, or Associated Persons of Directors, where NZX is satisfied
that the amounts and terms of the assistance will be determined according to
criteria applying generally to all employees eligible to receive the
assistance, and would not, if all relevant factors were publicly disclosed,
be reasonably seen as being materially influenced by the relationship; and/or

(b)  where NZX is satisfied that the assistance is not likely
disproportionately to benefit the persons controlling the Issuer and those
associated with them."

Decision

11. On the basis that the information provided to NZXR is full and accurate
in all material respects, and subject to the conditions contained in
paragraph 12, below, NZXR grants MET a waiver from Rule 7.6.4(b)(iii) to
allow MET to provide financial assistance to Mr Edwards pursuant to the terms
of the Plan.

12. The waiver in paragraph 11 is granted on the condition that MET's
Chairman certify, on behalf of MET's Board, that:

(a) Mr Edwards had no influence over the terms of the Plan and did not vote
on any resolutions relating to the Plan; and

(b) Mr Edwards will not participate in any MET Board discussions regarding
whether performance hurdles have been met, or whether Plan Shares should be
awarded where the required performance hurdles have not been met.

Reasons

13. In coming to this decision, NZXR has considered the following matters: ?

(a) The policy objective of Rule 7.6.4(b)(iii) is to ensure that Directors
are not able to exercise their discretion to provide financial assistance on
terms that are unfairly advantageous to them, or are otherwise inconsistent
with that provided to other employees;

(b) Mr Edwards is participating on the same terms, including as to financial
assistance, as all other employees, so will not be treated more favourably
than any other Participant;

(c) The terms of the Plan were determined by MET's Remuneration Committee and
approved by the MET Board (excluding Mr Edwards). The certification provided
by MET's Chairman gives NZXR comfort that Mr Edwards has had no influence
over the terms of the Plan, and will not vote on any resolutions relating to
the Plan, or participate in any discussions of MET's Board regarding whether
Exercise Hurdles have been met;

(d) The situation falls within the circumstances stated in the footnote to
Rule 7.6.4, therefore it is appropriate to grant the waiver; and

(e) There is precedent for this decision.

Confidentiality

14. MET has requested that its application and any decision be kept
confidential until details of the Plan are released to the market.

15. In accordance with footnote 1 to Rule 1.11.2, NZXR grants MET's request.

ENDS.
End CA:00228040 For:MET    Type:WAV/RULE   Time:2012-10-02 17:09:08