FSF
07/04/2015 08:30
WAV/RULE
NOT PRICE SENSITIVE
REL: 0830 HRS Fonterra Shareholders' Fund (NS)
WAV/RULE: FSF: FCG Waiver from NZX Debt Market Listing Rule 3.2.1(d)
NZX Regulation Decision
Fonterra Co-operative Group Limited (FCG)
Application for a waiver from NZX Debt Market Listing Rule 3.2.1(d)
2 April 2015
Waiver from NZX Debt Market Listing Rule 3.2.1(d)
Decision
1. On the condition set out in paragraph 2 below, and on the basis that the
information provided by FCG is complete and accurate in all material
respects, NZX Regulation ("NZXR") grants FCG a waiver from NZX Debt Market
Listing Rule ("Rule") 3.2.1(d) to the extent that this Rule requires that the
Master Trust Deed issued by FCG shall provide that a meeting of Security
holders shall be called on a requisition in writing signed by holders of not
less than 10% of the amount of the Securities for the time being outstanding.
2. The waiver in paragraph 1 above is provided on the condition that the
Master Trust Deed shall provide that a meeting of Security holders shall be
called on a requisition in writing signed by holders of not less than 5% of
the nominal value of the Securities for the time being outstanding.
3. The material information on which this decision is based is set out in
Appendix One to this decision. This waiver will not apply if that information
is not, or ceases to be, full and accurate in all material respects.
4. Rule 3.2.1(d) to which this decision relates is set out in Appendix Two.
Reasons
5. In coming to the decision to provide the waiver set out in paragraph 1
above, NZXR has considered that:
a. the Master Trust Deed currently complies with Rule 3.2.1(d), by providing
that a meeting of Security holders shall be called on a requisition in
writing signed by holders of not less than 10% of Securities outstanding. The
Threshold in Rule 3.2.1(d) aligns with the Threshold prescribed under clause
3(1) of Schedule 15 to the Securities Regulations;
b. the Securities Regulations were revoked on 1 December 2014, by section
5(o) of the Financial Markets (Repeals and Amendments) Act 2013. Section
120(1)(b) of the FMCA now requires that a meeting of a class of debt security
holders must be called by an Issuer on the written request of holders of no
less than 5% of the nominal value of the debt securities on issue in that
class;
c. while the Securities Regulations still apply to those Issuers continuing
to comply with the Securities Act Regime up until 30 November 2016, the FMC
Regime will apply to those Issuers who choose to transition to the new regime
prior to 30 November 2016. FCG intends to transition to the FMC Regime and
has selected an effective date of 10 April 2015;
d. under the Rules, and but for a waiver, Issuers who have transitioned to
the FMC Regime would need to provide in their trust deed a greater threshold
than the Threshold permitted by the legislation; and
e. the legislative change to the Threshold affords a greater level of
protection to investors. As FCG is transitioning to the FMC Regime, NZXR
considers that it is appropriate that FCG should be able to amend its Master
Trust Deed to align with the Threshold in the FMC Regime, without breaching
the Rules.
Confidentiality
6. FCG has requested that the application for a waiver from Rule 3.2.1(d) and
NZXR's decision be kept confidential until the amendment documents to the
Trust Deed are executed and lodged with the registrar.
7. In accordance with Footnote 1 to Rule 1.11.2, NZXR grants FCG's request.
Appendix One
1. Fonterra Co-operative Group Limited ("FCG") is a Listed Issuer with the
FCG020 Bonds Quoted on the NZX Debt Market ("NZDX").
2. The terms and conditions of the FCG020 Bonds are contained in the master
trust deed between FCG and The New Zealand Guardian Trust Company Limited
(the "Trustee") dated 18 November 2002, as amended from time to time, (the
"Master Trust Deed") as modified and supplemented by a supplemental trust
deed (No. 11) dated 9 November 2010 (together with the Master Trust Deed, the
"Trust Deed"). FCG may also issue further securities under the Master Trust
Deed.
3. FCG and the Trustee propose to amend the Trust Deed to reflect and comply
with the requirements of the Financial Markets Conduct Act 2013 ("FMCA") and
Financial Markets Conduct Regulations 2014 (together the "FMC Regime"), as
well as making certain other tidy-up amendments.
4. As part of these broader amendments, FCG and the Trustee intend to amend
the percentage of Security holders able to requisition, in writing, a meeting
of Security holders (the "Threshold") specified in clause 2.2 of Schedule 1
of the Master Trust Deed. FCG intends to amend clause 2.2 of Schedule 1 to
set the Threshold at not less than 5% of the nominal value of the debt
securities on issue in that class.
5. This proposed amendment reflects the change to the Threshold prescribed
under the FMC Regime, from the previous requirement under the Securities Act
1978 ("Securities Act Regime").
6. Section 120(1)(b) of the FMCA requires that a meeting of a class of
holders of a debt security must be called by the Issuer on the written
request of holders of the debt securities that have a combined nominal value
of no less than 5% of the nominal value of the debt securities on issue in
that class. This provision replaces clause 3(1) of Schedule 15 to the
Securities Regulations 2009 ("Securities Regulations"), which deemed trust
deeds to contain a clause that persons holding not less than one-tenth in
nominal value of the issued debt securities to which the deed relates could
requisition a meeting of the holders of those securities.
7. FCG has selected an effective date for the purposes of the FMC Regime of
10 April 2015 ("Effective Date"). The amendments to the Trust Deed will not
come into effect until FCG's Effective Date, to ensure compliance with
existing legislation in the interim.
8. These amendments will be made under the relevant amendment mechanisms
contained in the Trust Deed, and the proposed amendments are of a nature that
does not require bondholder consent.
Appendix Two
Rule 3.2.1
3.2.1 Every Trust Deed governing Debt Securities shall provide that:
...
(d) a meeting of Security holders shall be called on a requisition in writing
signed by holders of not less than 10% of the amount of the Securities for
the time being outstanding; and
End CA:00262747 For:FSF Type:WAV/RULE Time:2015-04-07 08:30:36
