CONSTITUTION

Of

[insert name of company]

Under the Companies Act 1993

Document Number

(for office use)

Company Number

(for existing company)

NZBN

CCH Constitution: CO.01 (for existing company)

Form CO.01 — Constitution

TABLE OF CONTENTS

PART 1. THE SCHEDULE 6.2. Solvency test

6.3. Special financial assistance
PART 2. SPECIAL PROVISIONS 6.4. Disclosure document
6.5. Financial assistance not over 5
PART 3. GENERAL percent of shareholders’ funds
3.1. Interpretation
3.2. Capacity 7. Calls on Shares
7.1. Power to make call
PART 4. SHARES 7.2. Time call made
4. Share Capital and Variation of 7.3. Liability
Rights 7.4. Interest on calls in arrears
4.1. Rights and powers attaching to shares 7.5. Extended meaning of call
4.2. Classes of shares 7.6. Differentiation between shares
4.3. Redeemable shares 7.7. Calls in advance
4.4. Alteration of shareholder rights
4.5. No notice of trusts 8. Suspension of Right to Dividends
4.6. Personal representative may be 8.1. Notice of suspension
registered 8.2. Application of suspended dividends
4.7. Statement of rights to be given to 8.3. Liability not discharged
shareholders 8.4. Lifting of suspension
4.8. Issue of share certificates
4.9. Duplicate share certificates 9. Lien
4.10. Share register 9.1. Lien on shares
4.11. Evidence of legal title 9.2. Power to sell
4.12. Directors’ duty 9.3. Authority to transfer
4.13. Liability of shareholders 9.4. Proceeds of sale
4.14. Liability of former shareholders
10. Transfer of Shares
5. Company Holding its Own Shares 10.1. Execution and registration
5.1. Company holding its own shares 10.2. Form of transfer
5.2. Acquisition of company’s own shares 10.3. Rights to refuse transfer
5.3. Board may make offer to acquire 10.4. Where share certificate issued
shares 10.5. Notice of refusal to register
5.4. Special offers to acquire shares
5.5. Disclosure document 11. Restriction upon Transfer of Shares
5.6. Cancellation of shares repurchased 11.1. Proposing Transferor, Other
5.7. Company may hold its own shares Shareholders, Board Nominee
5.8. Rights and obligations of shares 11.2. Transfer Notice, Transferor’s Valuation
company holds in itself suspended 11.3. Expiry Date, Pre-emption Notice
5.9. Reissue of shares company holds in 11.4. Fair Value
itself 11.5. Part acceptance not effective
11.6. Revocation of Transfer Notice
6. Assistance by Company in 11.7. Board may execute transfer
Purchase of Own Shares 11.8. If no buyers
6.1. Financial assistance 11.9. Assignee to sell shares to
shareholders
11.10. Transfer by personal representatives 17. Proceedings at Meetings of
11.11. Approval by all shareholders Shareholders
11.12. Permitted transfers 17.1. Chairperson
17.2. Notice of meetings
12. Transmission of Shares 17.3. Methods of holding meetings
12.1. Recognition of title on death of 17.4. Quorum of shareholders
shareholder 17.5. Voting
12.2. Election of registration 17.6. Proxies
12.3. Upon election 17.7. Postal votes
12.4. Transfer of shares by operation of law 17.8. Minutes
12.5. Entitlement to dividends and rights 17.9. Shareholder proposals
17.10. Corporations may act by
13. Forfeiture and Surrender of Shares representatives
13.1. Failure to pay call or instalment 17.11. Votes of joint holders
13.2. Notice of default13.3. Forfeiture on 17.12. Loss of voting rights if calls unpaid
non-compliance 17.13. Other proceedings
13.4. Disposal of forfeited share 17.14. Vote before notice of revocation
13.5. Liability in respect of forfeited shares 17.15. Voting by mentally disordered and
13.6. Notice of forfeiture protected persons
13.7. Declaration of forfeiture 17.16 Shareholder participation by electronic
13.8. Consideration for and transfer of means
forfeited share
13.9. Sums due other than calls 18. Distributions to Shareholders
18.1. Solvency test
14. Issue of New Shares 18.2. Dividends payable pari passu
14.1. Time of issue of shares 18.3. Bonus shares in lieu of dividend
14.2. Issue of shares on registration or 18.4. Declared according to amount paid up
amalgamation 18.5. Deduction of shareholders’ debts
14.3. Issue of other shares 18.6. Mode of payment
14.4. Shareholder approval for issue of new 18.7. Shareholder discounts
shares
14.5. Same conditions apply to new shares PART 6. MANAGEMENT
14.6. Entitlement to new shares 19. Appointment and Removal of
14.7. Consideration Directors
19.1. Appointment and removal of directors
PART 5. SHAREHOLDERS 19.2. Qualification
15. Shareholder Powers 19.3. Director’s consent required
15.1. Powers reserved to shareholders
15.2. Ordinary resolutions 20. Powers of Directors
15.3. Special resolutions 20.1. Management of company
15.4. Unanimous shareholder agreements
15.5. Solvency test 21. Self-Interest Transactions
15.6. Management review by shareholders 21.1. Restrictions on self-interest
15.7. Minority buy-out rights transactions
15.8. Interest groups buy-out rights 21.2. Meaning of “interested”
15.9. Notice requiring purchase 21.3. Disclosure of interest
21.4. Avoidance of transactions
16. Meetings and Resolutions 21.5. Interested director may vote
16.1. Annual meeting of shareholders
16.2. Special meetings of shareholders 22. Duties of Directors
16.3. Resolution in lieu of meeting 22.1. Duty to act in good faith and in best
16.4. Ascertaining shareholders interests of company
22.2. Subsidiary
22.3. Joint venture 29.2. Annual report
22.4. Exercise of powers in relation to 29.3. Annual report to shareholders
employees 29.4. Shareholders may elect not to receive
22.5. Powers to be exercised for proper documents
purpose
22.6. Directors to comply with Act and 30. Inspection of Company Records
constitution 30.1. Public inspection of company records
22.7. Reckless trading 30.2. Inspection of company records by
22.8. Duty in relation to obligations shareholders
22.9. Director’s duty of care 30.3. Manner of inspection
22.10. Keep minutes and records 30.4. Copies of documents
22.11. Keep accounts 30.5. Information for shareholders
22.12. Annual return 30.6. Inspection of records by directors
30.7. Company records
23. Directors Ceasing to Hold Office
23.1. Director ceasing to hold office 31. Audit
23.2. Notice of change of directors 31.1. When no auditors required
31.2. When auditors required
24. Additional Directors
24.1. Vary number of directors 31A. Opt-in regime for financial reporting
24.2. Co-opt directors 31A.1 Opting-in
24.3. Appointment of alternate directors
32. Notices
25. Proceedings of Board of Directors 32.1. Service
25.1. Chairperson 32.2. Joint holders
25.2. Notice of meeting 32.3. Mentally disordered or protected
25.3. Methods of holding meetings person, deceased or bankrupt estate
25.4. Quorum 32.4. Notice of meeting
25.5. Voting 32.5. Service on director or shareholder
25.6. Minutes 32.6. Time of service by facsimile
25.7. Unanimous resolution 32.7. Time of service by post
25.8. Other proceedings 32.8. Proof of service
25.9. Mediation or arbitration
33. Address for Service
26. Managing Director 33.1. Address for service
26.1. Appointment 33.2. Change of address for service
26.2. Powers 33.3. No address supplied
26.3. Remedy damages only
34. Secrets of Company
27. Indemnity, Insurance, and 34.1. Shareholders not entitled
Remuneration 34.2. Use of company information
27.1. Indemnity and insurance
27.2. Remuneration and other benefits of 35. Secretary
directors 35.1. Appointment and removal

PART 7. ADMINISTRATION 36. Liquidation

28. Authority to Bind Company 36.1. Surplus assets
28.1. Method of contracting
37. Removal from the New Zealand
29. Accounts Register
29.1. Accounting records to be kept 37.1. Request for removal
PART 1. THE SCHEDULE 1.1. The schedule in this part 1 which is
referred to later in this constitution is as
follows: other clauses merely reflect statutory
Appointment and removal of directors provisions which are mandatory.
Option A
(1) Directors may from time to time be
appointed and removed from office in PART 3. GENERAL
accordance with clause 19.1 by ordinary
resolution of the company.* Interpretation
3.1.
Option B (1) In this constitution, unless the context
(1) The majority of votes required to appoint otherwise requires:
or remove from office the directors of the Act — means the Companies Act 1993.
company in accordance with clause 19.1 Definitions in Act — Words or expressions
must be at least [number] percent of the contained in this constitution bear the same
votes cast at a poll taken at a meeting of the meanings as in the Act (or any statutory
company which is called for that purpose.* modification of it).
* Select one and if Option B is selected insert Headings — Headings and cross references
percentage number. Delete (1A). in square brackets to other clauses of this
(1A) If neither Option A nor Option B is constitution and to legislation are inserted for
deleted, then Option A is deemed to apply. convenience only and do not form part of this
Quorum of shareholders of interest group document for the purposes of interpretation.
(2) The number of members of an interest Masculine, feminine, and neuter — Words
group which constitutes a quorum of an which import any gender include the other
interest group in accordance with clause genders.
4.4(2)(a) is [number]. Month — means calendar month.
Quorum of shareholders Person — includes partnerships,
(3) The number of shareholders which associations, and corporations as well as
constitutes a quorum of shareholders in individuals.
accordance with clause 17.4(2) (holding the Protection attorney — means an attorney
shares specified in that subclause) is . who is appointed and acting under the
Quorum of directors Protection of Personal and Property Rights
(4) The number of directors which constitutes Act 1988.
a quorum of directors in accordance with Schedule — means (where not otherwise
clause 25.4(1) is . defined) a schedule of the Companies Act
If no number is specified, then the quorum is 1993.
a majority of directors. Secretary — means any person appointed to
Issue of shares on registration or perform the duties of the secretary of the
amalgamation company.
(5) In accordance with clause 14.2(2) the Section — means (where not otherwise
details of payment of initial shares on defined) a section of the Companies Act 1993.
registration are: Singular and plural — Words which import
the singular include the plural number and
Class of shares words which import the plural include the
Consideration $ singular number as the case may be.
Date payment Subclause — means (where not otherwise
Place of payment defined) a subclause within the same clause
as the reference occurs.
PART 2. SPECIAL PROVISIONS Writing — References to writing (including
written) include printing, typing, and other
2.1. The clauses in this part 2 are clauses modes of representing words in visible form
that are paramount. Whenever these clauses including electronic means.
are inconsistent with clauses in the remainder (2) Present tense applies to future time —
of this constitution, these paramount clauses This constitution is always speaking.
prevail, except to the extent to which the Whenever any matter or thing is expressed in
the present tense, then the matter or thing is may:
applied to the circumstances as they arise, so (a) Be redeemable within the meaning of
that effect may be given to this constitution clause 4.3; or
and every part of it according to its spirit, true (b) Confer preferential rights to distributions of
intent, and meaning. capital or income; or
(c) Confer special, limited, or conditional
Capacity voting rights; or
3.2. Subject to the Act, any other enactment, (d) Not confer voting rights.
and the general law, the company has, both [See section 37]
inside and outside New Zealand:
(a) Full capacity to carry on or undertake any Redeemable shares
business or activity, do any act, or enter into 4.3. Any shares may, with the sanction of a
any transaction; and special resolution, be issued on the terms that
(b) For the purposes of paragraph (a), full they may be redeemed by the company:
rights, powers, and privileges. (a) At the option of the company; or
[See section 16] (b) At the option of the holder of the share; or
(c) On a date specified in this constitution;
PART 4. SHARES for a consideration that is:
(d) Specified; or
4. SHARE CAPITAL AND VARIATION OF (e) To be calculated by reference to a formula;
RIGHTS or
(f) Required to be fixed by a suitably qualified
Rights and powers attaching to shares person who is not associated with or
4.1. (1) Subject to subclause (2), a share interested in the company.
confers on the holder: [See sections 68 to 75]
(a) The right to 1 vote on a poll at a meeting of
the company on any resolution, including any Alteration of shareholder rights
resolution to: Special resolution of interest group
(i) Appoint or remove a director or auditor; 4.4. (1) The company must not take action
(ii) Adopt a constitution; that affects the rights attached to shares
(iii) Alter this constitution; unless that action has been approved by a
(iv) Approve a major transaction; special resolution of each interest group.
(v) Approve an amalgamation under section
221; Quorum of interest group
(vi) Put the company into liquidation. (1A) No business may be transacted at a
(b) Subject to clauses 8, 18.4 and 18.5, the meeting of an interest group if a quorum is not
right to an equal share in dividends authorised present. If a quorum is not present within 30
by the board. minutes after the time appointed for the
(c) Subject to clause 36.1, the right to an meeting, the meeting is adjourned to the same
equal share in the distribution of the surplus day in the following week, at the same time
assets of the company. and place, or to such other date, time, and
(2) Subject to clause 18.2, the rights specified place as the directors may appoint, and if, at
in subclause (1) may be negated, altered, or the adjourned meeting, a quorum is not
added to by this constitution, whether in part 2 present within 30 minutes after the time
or elsewhere, or in accordance with the terms appointed for the meeting, the members of the
on which the share is issued under clause interest group present or their proxies are a
14.2(3), or clause 14.3, or clause 14.4. quorum.
[See section 36] (2) A quorum for a meeting of an interest
group is present if members of that interest
Classes of shares group or their proxies are present or have cast
4.2. (1) Different classes of shares may be postal votes who between them:
issued by the company. (a) Total the number specified in the schedule
(2) Without limiting subclause (1), shares in clause 1.1; or
(b) If no number is specified, then are able to beneficially entitled to a share in the company
exercise a majority of the votes to be cast on (being a share registered in the share register)
the business to be transacted by the meeting. is, with the consent of the company and the
Rights attached to shares registered holder of that share, entitled to be
(3) For the purposes of subclause (1), the registered as the holder of that share as
rights attached to shares include: personal representative.
(a) The rights, privileges, limitations, and No notice of trust
conditions attached to the share by the Act or (3) The registration of a trustee, executor, or
by this constitution, including voting rights and administrator pursuant to this clause does not
rights to distributions; constitute notice of a trust.
(b) Pre-emptive rights arising under clause [See section 93]
14.6 or elsewhere under this constitution;
(c) The right to have the procedure in this Statement of rights to be given to
clause, and any further procedure required shareholders
elsewhere by this constitution for the 4.7. (1) The company must issue to a
amendment or alteration of rights, observed shareholder, on request, a statement that sets
by the company; and out:
(d) The right that a procedure required (a) The class of shares held by the
elsewhere by this constitution for the shareholder, the total number of shares of that
amendment or alteration of rights not be class issued by the company and the number
amended or altered. of shares of that class held by the
Issue of further shares shareholder; and
(4) For the purposes of subclause (1), the (b) The rights, privileges, conditions, and
issue of further shares ranking equally with, or limitations, including restrictions on transfer,
in priority to, existing shares, whether as to attaching to the shares held by the
voting rights or distributions, is deemed to be shareholder; and
action affecting the rights attached to the (c) The relationship of the shares held by the
existing shares, unless: shareholder to other classes of shares.
(a) This constitution elsewhere expressly When no statement required
permits the issue of further shares ranking (2) The company is not obliged to provide a
equally with, or in priority to, those shares; or shareholder with a statement if:
(b) The issue is made in accordance with the (a) A statement has been provided within the
pre-emptive rights of shareholders under previous 6 months; and
clause 14.6 or elsewhere under this (b) The shareholder has not acquired or
constitution. disposed of shares since the previous
[See sections 116 to 119] statement was provided; and
(c) The rights attached to shares of the
No notice of trusts company have not been altered since the
4.5. No notice of a trust, whether express, previous statement was provided; and
implied, or constructive, may be entered on (d) There are special circumstances that make
the share register. it reasonable for the company to refuse the
[See section 92] request.
Not evidence of title
Personal representative may be registered (3) The statement is not evidence of title to the
4.6. (1) Notwithstanding clause 4.5, a shares or of any of the matters set out in it.
personal representative of a deceased person (4) The statement must state in a prominent
whose name is registered in the share register place that it is not evidence of title to the
as holder of that share is entitled to be shares or of the matters set out in it.
registered as the holder of that share as [See section 83]
personal representative.
Beneficial entitlement where not registered Issue of share certificates
(2) Notwithstanding clause 4.5, a personal 4.8. (1) A shareholder may apply to the
representative of a deceased person company for a certificate relating to some or
all of his or her shares in the company. the latest known address of each person who
(2) Subclause (1) does not apply if the is, or has within the last 10 years been, a
company’s shares can be transferred in shareholder; and
accordance with the rules of a designated (b) The number of shares of that class held by
settlement system or under s 376 of the each shareholder within the last 10 years; and
Financial Markets Conduct Act 2013, without (c) The date of any:
a share certificate. (i) Issue of shares to; or
Duties of company (ii) Repurchase or redemption of shares from;
(3) On receipt of an application for a share or
certificate, the company must within 20 (iii) Transfer of shares by or to;
working days after receiving the application: each shareholder within the last 10 years, and
(a) If the application relates to some but not all in relation to the transfer, the name of the
of the shares, separate the shares shown in person to or from whom the shares were
the register as owned by the applicant into transferred.
separate parcels: one parcel being the shares (3) An agent may maintain the share register.
to which the share certificate relates, and the [See section 87]
other parcel being any remaining shares; and
(b) In all cases, send to the shareholder a Evidence of legal title
certificate stating: 4.11. (1) Subject to section 91, the entry of the
(i) The name of the company; and name of a person in the share register as
(ii) The class of shares held by the holder of a share is prima facie evidence that
shareholder; and legal title to the share vests in that person.
(iii) The number of shares held by the Entitlement to rights
shareholder to which the certificate relates. (2) The company may treat the registered
Joint holding holder of a share as the only person entitled
(4) In respect of shares held jointly by several to:
persons the company need not issue more (a) Exercise the right to vote attaching to the
than 1 certificate. Delivery of a certificate for a share; and
share to one of several joint holders is (b) Receive notices; and
sufficient delivery to all holders. (c) Receive a distribution in respect of the
[See section 95] share; and
(d) Exercise the other rights and powers
Duplicate share certificates attaching to the share.
4.9. If a share certificate is defaced, lost, or [See section 89]
destroyed, then it may be renewed on
whatever terms (if any) as to evidence and Directors’ duty
indemnity and the payment of out-of-pocket 4.12. It is the duty of each director to take
expenses of the company in investigating the reasonable steps to ensure that the share
evidence the board thinks fit. register is properly kept and that share
transfers are promptly entered on it in
Share register accordance with clause 10.
4.10. (1) The company must maintain a share [See section 90]
register that records the shares issued by the
company and states: Liability of shareholders
(a) Whether, under this constitution or the 4.13. (1) A shareholder is not liable for an
terms of issue of the shares, there are any obligation of the company by reason only of
restrictions or limitations on their transfer; and being a shareholder.
(b) Where any document that contains the Liability limited
restrictions or limitations may be inspected. (2) The liability of a shareholder is limited to:
Details required (a) Any amount unpaid on a share held by the
(2) The share register must state, with respect shareholder;
to each class of shares: (b) Any liability expressly provided for
(a) The names, alphabetically arranged, and elsewhere in this constitution;
(c) Any liability under sections 131 to 137 that (b) Sections 110 to 112;
arises through section 126(2); are deemed to be cancelled immediately on
(d) Any liability to repay a distribution acquisition.
recoverable under section 56; and Notice to Registrar
(e) Any liability under section 100 of the Act. (3) Within 10 working days of the purchase or
[See section 97] acquisition of the shares, the board must
ensure that notice in the prescribed form of
Liability of former shareholders the purchase or acquisition is delivered to the
4.14. (1) A former shareholder who ceased to Registrar for registration.
be a shareholder during the specified period is
liable to the company in respect of any Acquisition of company’s own shares
amount unpaid on the shares held by that 5.2. (1) Subject to clause 18.1, the company is
former shareholder or any liability provided for expressly permitted to purchase or otherwise
in this constitution for which that former acquire shares issued by it.
shareholder was liable to the company, if the (2) The purchase or acquisition must be made
Court is satisfied that the shareholders of the in accordance with clause 5.3.
company are unable to discharge any liability: [See section 59]
(a) For any amount unpaid on shares held by
them; or Board may make offer to acquire shares
(b) Expressly provided for elsewhere in this 5.3. (1) The board may make an offer to
constitution. acquire shares issued by the company if the
Debts contracted later offer is:
(2) A former shareholder is not liable under (a) An offer to all shareholders to acquire a
subclause (1) for any debt or liability of the proportion of their shares, that:
company which was contracted after ceasing (i) Would, if accepted, leave unaffected
to be a shareholder. relative voting and distribution rights; and
Reregistered companies (ii) Affords a reasonable opportunity to accept
(3) Subclauses (1) and (2) apply, with the offer; or
whatever modifications are necessary, in (b) An offer to 1 or more shareholders to
relation to an existing company that has acquire shares:
become reregistered in accordance with the (i) To which all shareholders have consented
Companies Reregistration Act 1993 and as if in writing; or
the reference to a former shareholder (ii) That is expressly permitted elsewhere by
included a reference to a person who was a this constitution, and is made in accordance
member of the company before the with clause 5.4.
reregistration. Additional shares
Meaning of specified period (2) Where an offer is made in accordance with
(4) For the purposes of subclause (1), subclause (1)(a):
“specified period” has the meaning defined in (a) The offer may also permit the company to
section 98(6). acquire additional shares from a shareholder
[See section 98] to the extent that another shareholder does
not accept the offer or accepts the offer only in
5. COMPANY HOLDING ITS OWN SHARES part; and
(b) If the number of additional shares exceeds
Company holding its own shares the number of shares that the company is
5.1. (1) The company may, pursuant to entitled to acquire, the number of additional
clauses 5.2 to 5.6, and sections 59 to 66, shares must be reduced rateably.
clause 15.4, and sections 110 to 112, but not Prior resolution
otherwise, hold its own shares. (3) The board may make an offer under
Cancellation if non-compliance subclause (1) only if it has previously
(2) Shares acquired by the company resolved:
otherwise than in accordance with: (a) That the acquisition in question is in the
(a) Sections 59 to 66; and best interests of the company; and
(b) That the terms of the offer and the Reasons for conclusions
consideration offered for the shares are fair (2) The resolution must set out in full the
and reasonable to the company; and reasons for the directors’ conclusions.
(c) That it is not aware of any information that Certificate
will not be disclosed to shareholders: (3) The directors who vote in favour of a
(i) Which is material to an assessment of the resolution required by subclause (1) must sign
value of the shares; and a certificate as to the matters set out in that
(ii) As a result of which the terms of the offer subclause.
and consideration offered for the shares are Change in circumstances
unfair to shareholders accepting the offer. (4) The board must not make an offer under
Reasons for conclusions clause 5.3(1)(b)(ii) if, after passing of a
(4) The resolution must set out in full the resolution under subclause (1) and before the
reasons for the directors’ conclusions. making of the offer to acquire the shares, the
Certificate board ceases to be satisfied that:
(5) The directors who vote in favour of a (a) The acquisition is of benefit to the
resolution required by subclause (3) must sign remaining shareholders; or
a certificate as to the matters set out in that (b) The terms of the offer and the
subclause, and may combine it with the consideration offered for the shares are fair
certificate required by clause 18.1 and any and reasonable to the remaining
certificate required under clause 5.4. shareholders.
Change in circumstances Disclosure
(6) The board must not make an offer under (5) Before an offer is made pursuant to a
subclause (1) if, after the passing of a resolution under subclause (1), the company
resolution under subclause (3) and before the must send out to each shareholder a
making of the offer to acquire the shares: disclosure document that complies with clause
(a) The board ceases to be satisfied that the 5.5.
acquisition in question is in the best interests (6) The offer must be made not less than 10
of the company; or working days and not more than 12 months
(b) The board ceases to be satisfied that the after the disclosure document has been sent
terms of the offer and the consideration to each shareholder.
offered for the shares are fair and reasonable Right to object
to the company; or (7) A shareholder or the company may apply
(c) The board becomes aware of any to the Court for an order restraining the
information that will not be disclosed to proposed acquisition on the grounds that:
shareholders: (a) It is not in the best interests of the
(i) Which is material to an assessment of the company and of benefit to remaining
value of the shares; or shareholders; or
(ii) As a result of which the terms of the offer (b) The terms of the offer and the
and the consideration offered for the shares consideration offered for the shares are not
would be unfair to shareholders accepting the fair and reasonable to the company and
offer. remaining shareholders.
[See section 60] [See section 61]

Special offers to acquire shares Disclosure document

5.4. (1) The board may make an offer under 5.5. For the purposes of clause 5.4, a
clause 5.3(1)(b)(ii) only if it has previously disclosure document is a document that sets
resolved: out:
(a) That the acquisition is of benefit to the (a) The nature and terms of the offer, and if
remaining shareholders; and made to specified shareholders, to whom it
(b) That the terms of the offer and the will be made; and
consideration offered for the shares are fair (b) The nature and extent of any relevant
and reasonable to the remaining interest of any director in any shares the
shareholders. subject of the offer; and
(c) The text of the resolution required by Suspension of voting rights and
clause 5.4, together with such further distributions
information and explanation as may be (2) Without limiting subclause (1), while the
necessary to enable a reasonable company holds a share in itself pursuant to
shareholder to understand the nature and clause 5.7, the company shall not:
implications for the company and its (a) Exercise any voting rights attaching to the
shareholders of the proposed acquisition.[See share; or
section 62] (b) Make or receive any distribution authorised
or payable in respect of the share.
Cancellation of shares repurchased [See section 67B]
5.6. Subject to clauses 5.7 to 5.9, shares that
are acquired by a company pursuant to clause Reissue of shares company holds in itself
5.2 or section 112 are deemed to be 5.9. (1) Subject to subclause (2), clause 14.7
cancelled immediately on acquisition, but may applies to the transfer of a share held by the
be reissued in accordance with Part 6 of the company in itself as if the transfer were the
Act. issue of the share under clause 14.3 or clause
[See section 66] 14.4.
Electronic transfer of securities
Company may hold its own shares (2) Clause 14.7(2) does not apply to the
5.7. (1) Shares acquired by the company transfer of a share held by the company in
pursuant to clause 5.2 or section 112 are not itself if the share is transferred by a system
deemed to be cancelled under clause 5.6 if: approved under section 376 of the Financial
(a) The board resolves that the shares Markets Conduct Act 2013.
concerned shall not be cancelled on Share transfer not subject to Act or
acquisition; and constitution
(b) The number of shares acquired, when (3) Subject to subclause (1), the transfer of a
aggregated with shares of the same class share by the company in itself is not subject to
held by the company pursuant to this clause any provisions in the Act or in this constitution
at the time of the acquisition, does not exceed relating to the issue of shares, except to the
5 percent of the shares of that class extent that this constitution expressly applies
previously issued by the company, excluding those provisions.
shares previously deemed to be cancelled [See section 67C]
under clause 5.6.
To be held by company in itself 6. ASSISTANCE BY COMPANY IN
(2) Shares acquired by the company pursuant PURCHASE OF OWN SHARES
to clause 5.2 or section 112 that, pursuant to
this clause, are not deemed to be cancelled Financial assistance
must be held by the company in itself. 6.1. (1) The company may give financial
Discretion to cancel assistance to a person for the purpose of, or
(3) A share that the company holds in itself in connection with, the purchase of a share
under subclause (2) may be cancelled by the issued or to be issued by the company, or by
board resolving that the share is cancelled; its holding company, whether directly or
and the share is deemed to be cancelled on indirectly, only if the financial assistance is
the making of the resolution. given in accordance with subclause (2) and:
[See section 67A] (a) All shareholders have consented in writing
to the assistance; or
Rights and obligations of shares company (b) Clause 6.3 is followed; or
holds in itself suspended (c) The financial assistance is given in
5.8. (1) The rights and obligations attaching to accordance with clause 6.5.
a share that the company holds in itself Prior resolution
pursuant to clause 5.7 shall not be exercised (2) The company may give financial
by or against the company while it holds the assistance under subclause (1) if the board
share. has previously resolved that:
(a) The company should provide the company will, immediately after the financial
assistance; and assistance is given, satisfy the solvency test,
(b) Giving the assistance is in the best any financial assistance given by the company
interests of the company; and is deemed not to have been authorised.
(c) The terms and conditions under which the Assets and liabilities
assistance is given are fair and reasonable to (4) In applying the solvency test for this
the company. clause, “assets” and “liabilities” have the
Reasons for conclusions meanings given by section 77(6).
(3) The resolution must set out in full the [See sections 4 and 77]
grounds for the directors’ conclusions.
Certificate Special financial assistance
(4) The directors who vote in favour of a 6.3. (1) Financial assistance may be given
resolution under subclause (2) must sign a under clause 6.1(1)(b) only if the board has
certificate as to the matters set out in that previously resolved:
subclause and may combine that certificate (a) That giving the assistance in question is of
with the certificate required under clause 6.2 benefit to those shareholders not receiving
and any certificate required under clause 6.3. assistance; and
Change in circumstances (b) That the terms and conditions under which
(5) A company must not give financial the assistance is given are fair and
assistance under subclause (1) if, after reasonable to those shareholders not
passing a resolution under subclause (2) and receiving the assistance.
before the assistance is given, the board Reasons
ceases to be satisfied that: (2) The resolution must set out in full the
(a) The giving of the assistance is in the best reasons for the directors’ conclusions.
interests of the company; or Certificate
(b) The terms and conditions under which the (3) The directors who vote in favour of a
assistance is proposed are fair and resolution required by subclause (1) must sign
reasonable to the company. a certificate as to the matters set out in that
Loan, guarantee, and security subclause.
(6) For the purposes of this clause “financial Change in circumstances
assistance” includes a loan, a guarantee, and (4) The company must not give financial
the provision of a security. assistance under clause 6.1(1)(b) if, after the
[See section 76] passing of a resolution under subclause (1)
and before the financial assistance is given,
Solvency test the board ceases to be satisfied that:
6.2. (1) The company must not give any (a) The giving of the financial assistance is of
financial assistance under clause 6.1 unless benefit to those shareholders not receiving the
the board is satisfied on reasonable grounds assistance; or
that the company will, immediately after the (b) The terms and conditions under which the
giving of the financial assistance, satisfy the assistance is given are fair and reasonable to
solvency test. those shareholders not receiving it.
Certificate Disclosure document
(2) The directors who vote in favour of giving (5) Before the financial assistance is given
financial assistance must sign a certificate under clause 6.1(1)(b), the company must
stating that, in their opinion, the company will, send to each shareholder a disclosure
immediately after the financial assistance is document that complies with clause 6.4.
given, satisfy the solvency test and the Time limit
grounds for that opinion. (6) The assistance may be given not less than
Change in circumstances 10 working days and not more than 12 months
(3) If, after a resolution is passed under after the disclosure document has been sent
subclause (1) and before the financial to each shareholder.
assistance is given, the board ceases to be Right to object
satisfied on reasonable grounds that the (7) A shareholder or the company may apply
to the Court for an order restraining the of which the financial assistance has been
proposed assistance being given on the provided;
ground that: (ii) The consideration paid or payable for the
(a) It is not in the best interests of the shares in respect of which the financial
company and of benefit to those shareholders assistance has been provided;
not receiving the assistance; or (iii) The identity of the person receiving the
(b) The terms and conditions under which the financial assistance and, if that person is not
assistance is to be given are not fair and the beneficial owner of the shares in respect
reasonable to the company and to those of which the financial assistance has been
shareholders not receiving the assistance. provided, the identity of that beneficial owner;
[See section 78] (iv) The nature and, if quantifiable, the amount
of the financial assistance.
Disclosure document [See section 80]
6.4. For the purposes of clause 6.3, a
disclosure document is a document that sets 7. CALLS ON SHARES
out:
(a) The nature and terms of the financial Power to make call
assistance to be given, and to whom it will be 7.1. (1) Subject to the terms of issue, the
given; and board may by resolution make calls upon the
(b) If the financial assistance is to be given to shareholders in respect of any money unpaid
a nominee for another person, the name of on their shares which is not (by the terms of
that other person; and issue of the shares) made payable at fixed
(c) The text of the resolution required by times.
clause 6.3(1), together with such further Notice
information and explanation as may be (2) Each shareholder must (subject to
necessary to enable a reasonable receiving at least 14 days’ notice specifying
shareholder to understand the nature and the time and place of payment) pay to the
implications for the company and its company (at the time and place specified) the
shareholders of the proposed transaction. amount which was called on that
[See section 79] shareholder’s shares.
Equal treatment
Financial assistance not over 5 percent of (3) A call may be revoked or postponed as the
shareholders’ funds board resolves. Subject to clause 7.6 and to
6.5. Financial assistance may be given under the terms of issue of any class of shares, a
clause 6.1(1)(c), only if: call, postponement, or revocation applies to all
Amount the shareholders of the class equally.
(a) The amount of financial assistance,
together with any other financial assistance Time call made
given by the company pursuant to this 7.2. (1) Unless the board resolves to the
paragraph, repayment of which remains contrary, a call is deemed to be made at the
outstanding, would not exceed 5 percent of time when the resolution of the board
the aggregate of amounts received by the authorising the call was passed.
company in respect of the issue of shares and (2) The board may resolve that a call is
reserves as disclosed in the relevant required to be paid by instalments.
statements or records, and the company
receives fair value in connection with the Liability
assistance; and Prior holders not liable
Notice 7.3. (1) Where a share renders its holder
(b) Within 10 working days of providing the liable to calls, or otherwise imposes a liability
financial assistance, the company sends to on its holder, that liability attaches to the
each shareholder a notice containing the holder of the share for the time being, and not
following particulars: to the prior holder of the share, whether or not
(i) The class and number of shares in respect the liability became enforceable before the
share was registered in the name of the at any fixed date is, for the purposes of this
current holder. constitution, deemed to be a call duly made
Subsequent holders not liable and payable on the date on which, by the
(2) Where: terms of issue, the sum becomes payable.
(a) All or part of the consideration payable in (2) If the sum is not paid, then all the relevant
respect of the issue of a share remains provisions of this constitution as to payment of
unsatisfied; and interest and expenses, forfeiture, or otherwise,
(b) The person to whom the share was issued apply as if the sum had become payable by
no longer holds that share; virtue of a call duly made and notified.
liability in respect of that unsatisfied
consideration does not attach to subsequent Differentiation between shares
holders of the share, but remains the liability 7.6. The board may, on the issue of shares,
of the person to whom the share was issued, by agreeing with the shareholders concerned,
or of any other person who assumed that differentiate between the shareholders of the
liability at the time of issue. same class as to the amount of calls to be
Joint and several paid and the times of payment.
(3) The joint holders of a share are jointly and
severally liable to pay all calls in respect of the Calls in advance
share. 7.7. (1) The board may if it thinks fit receive
[See section 100] from any shareholder who is willing to
advance the money all or any part of the
Interest on calls in arrears money which is uncalled and unpaid upon any
7.4. (1) If a sum which is called in respect of a shares held by him or her.
share is not paid before or on the day which is Interest
appointed for payment of the sum, then the (2) The board may, upon all or any part of the
person from whom the sum is due must pay money so advanced (until the money would,
interest on the sum (from the day appointed but for the advance, become payable), pay
for payment of the sum to the time of interest at whatever rate is agreed upon
payment) at the rate and at the time which the between the board and the shareholder who
board resolves. pays the sum in advance.
(2) The board may waive payment of that Repayment
interest wholly or in part. (3) The board may at any time repay the
Proof amount so advanced upon giving to the
(3) At any trial or hearing for recovery of shareholder 3 months’ notice in writing.
money due on a call, it is sufficient to prove: No right
(a) That the shareholder who is being sued is (4) No shareholder is entitled as of right to any
entered on the share register as holder (or as payment on any amount paid in advance
one of the holders) of the shares on which the unless agreed in accordance with this clause.
debt is due; and The board need not agree to pay interest or to
(b) That the resolution making that call is allow participation.
entered in the board’s minute book; and
(c) That notice of the call was given to the 8. SUSPENSION OF RIGHT TO DIVIDENDS
shareholder in accordance with this
constitution. Notice of suspension
(4) Proof of those matters is conclusive 8.1. (1) If a shareholder fails to pay any call or
evidence of the debt. instalment of a call on the due date, then the
(5) No evidence is needed of the appointment board may, while any part of the call or
or qualifications of the directors or of any instalment remains unpaid, serve a notice on
other matter. the shareholder requiring payment of that part
of the call or instalment which is unpaid
Extended meaning of call together with any interest which has accrued
7.5. (1) Any sum which, by the terms of issue and all expenses incurred by the company
of a share, becomes payable on allotment, or because of the non-payment.
(2) The notice must state: (b) Whether incurred before or after notice of
(a) Another date (not earlier than 5 days from any equitable interest in any person other than
service of the notice) on or before which the the registered holder;
payment required by the notice is to be made; (c) Whether the period for the repayment,
and fulfilment, or discharge of those debts,
(b) That, if payment is not made on or before liabilities, or engagements has actually arrived
the time appointed, then the right to dividends or not.
in respect of the shares subject to the call will (2) Such lien extends to all dividends or
be suspended. bonuses from time to time declared in respect
of such shares.
Application of suspended dividends (3) Unless otherwise agreed, the registration
8.2. (1) All dividends that would have been of a transfer of shares operates as a waiver of
payable in respect of shares subject to a the company’s lien, if any, on such shares.
suspension of the right to dividends must be
withheld by the company and applied to Power to sell
reduce the amount which is owing under the 9.2. (1) The company may sell (in whatever
call. manner the board thinks fit) any shares on
(2) The amount owing under the call, for the which the company has a lien.
purposes of this clause 8, may include any (2) No sale may be made:
interest which has accrued and all expenses (a) Unless a sum in respect of which the lien
incurred by the company because of non- exists is presently payable; and
payment by the shareholder under the call. (b) Until the expiration of 14 days
commencing on the day a notice in writing,
Liability not discharged which states and demands payment of that
8.3. A shareholder whose shares are the part of the amount in respect of which the lien
subject of a suspension of the right to exists as is presently payable, has been
dividends remains liable to the company for all given:
money which is owing under the call. That (i) To the registered holder of the share; or
liability is not extinguished by a transfer to a (ii) To the person who is entitled to the share
third party of the shares which are subject to by reason of the holder’s mental disorder,
the suspension. death, or bankruptcy.

Lifting of suspension Authority to transfer

8.4. When the total dividends which have 9.3. (1) To give effect to such a sale the board
been withheld and applied under this clause 8 may authorise any person to transfer the
equal the total amount which is owing under shares sold to the purchaser of the share.
the call (including amounts owing under (2) The purchaser must be registered as the
clause 8.2(2)) or when the shares are holder of the shares comprised in such a
transferred to a third party, then the transfer.
suspension of the right to dividends will be (3) The purchaser need not see to the
lifted and all rights to be paid dividends on the application of the purchase money, nor is his
shares will resume. or her title to the shares affected by any
irregularity or invalidity in the proceedings in
9. LIEN reference to the sale.
(4) The remedy of any person who is
Lien on shares aggrieved by the sale is in damages only and
9.1. (1) The company has a first and lies only against the company.
paramount lien upon all the shares registered (5) If the share certificate is not delivered to
in the name of each shareholder: the company, the board may issue a new
(a) Whether solely or jointly with others for his certificate, and may distinguish it from the
or her debts, liabilities, and engagements certificate not delivered.
solely or jointly with any other person to or
with the company; Proceeds of sale
9.4. (1) The proceeds of the sale must be agreement by the shareholder to transfer only
received by the company and applied in to some specified person or persons or
payment of that part of the amount in respect subject to some specified condition or
of which the lien exists as is presently conditions; or
payable. (d) Where the transferee is mentally
(2) The residue, if any, must (subject to a like disordered; or
lien for sums not presently payable as existed (e) Where the board believes effecting the
upon the shares before the sale) be paid to transfer would be a breach of the law; or
the person entitled to the shares at the date of (f) Where the instrument of transfer is in
the sale. respect of more than 1 class of share; or
(g) The board considers that it would not be in
10. TRANSFER OF SHARES the best interests of the company to register
the transfer of the shares; or
Execution and registration (h) Unless the instrument of transfer is
10.1. (1) Shares may be transferred by entry accompanied by such other evidence as the
of the name of the transferee on the share board reasonably requires to show the right of
register. the transferor to make the transfer.
(2) For the purpose of transferring shares, a [See section 84]
form of transfer signed by the present holder
of the shares or by his or her personal Where share certificate issued
representative must be delivered to: 10.4. (1) Notwithstanding clause 10.1 and
(a) The company; or section 84, where a share certificate has been
(b) An agent of the company who maintains issued, a transfer of the shares to which it
the share register under clause 4.10. relates must not be registered by the company
(3) The form of transfer must be signed by the unless the form of transfer is accompanied by
transferee if registration as holder of the the share certificate relating to the share, or
shares imposes on the transferee a liability to by evidence as to its loss or destruction and, if
the company. required, an indemnity in a form required by
[See section 84] the board.
(2) Where shares to which a share certificate
Form of transfer relates are to be transferred, and the share
10.2. Subject to such of the restrictions of this certificate is sent to the company to enable
constitution as may be applicable, any the registration of the transfer, the share
shareholder may transfer all or any of his or certificate must be cancelled and no further
her shares by instrument in writing in: share certificate issued except at the request
(a) Any usual or common form; or of the transferee.
(b) Any other form of which the board may [See section 95(5) and (6)]
approve; or
(c) The form set out in Schedule 18 of the Notice of refusal to register
Financial Markets Conduct Regulations 2014. 10.5. (1) On receipt of a form of transfer in
accordance with clause 10.1(2) and, if
Rights to refuse transfer applicable, clause 10.1(3), the company must
10.3. The board may refuse to register any forthwith enter or cause to be entered the
transfer of a share: name of the transferee on the share register
(a) Where the company has a lien on the as a holder of the shares, unless:
share; or (a) The board resolves within 30 working days
(b) Where the holder of the shares has failed of receipt of the transfer to refuse or delay the
to pay money owing to the company in registration of the transfer, and the resolution
respect of those shares, whether by way of sets out in full the reasons for doing so; and
consideration for the issue of the shares or in (b) Notice of the resolution, including those
respect of sums payable by the holder of the reasons, is sent to the transferor and to the
shares in accordance with this constitution; or transferee within 5 working days of the
(c) Where the board has notice of any resolution being passed by the board; and
(c) The Act or this constitution expressly the sale of shares to each of the Other
permits the board to refuse or delay Shareholders or to a Board Nominee at the
registration for the reasons stated. Transferor’s Valuation or (at the option of the
[See section 84] purchaser) at the Fair Value.

11. RESTRICTION UPON TRANSFER OF Expiry Date, Pre-emption Notice

SHARES 11.3. (1) The board must (forthwith upon
receipt of the Transfer Notice) serve on each
Proposing Transferor, Other Shareholders, of the Other Shareholders a notice (a “Pre-
Board Nominee emption Notice”) which:
11.1. (1) Clause 11 acknowledges the (a) Advises the Other Shareholders of the
partnership nature of the company and aims number of shares for sale; and
to protect shareholders’ relationships by (b) Advises the Other Shareholders of the
giving them a right of pre-emption should any Transferor’s Valuation; and
of their number wish to sell shares. (c) Names a date on which the option of the
(2) Clauses 11.1 to 11.9 must be given a fair, Other Shareholders to acquire all or any of the
large, and liberal interpretation so as to best shares if not already exercised is deemed to
attain the following objects: be declined (the “Expiry Date”). The Expiry
(a) If any shareholder, manager, protection Date is the day 28 days from receipt by the
attorney, or trustee in bankruptcy, or personal board of the Transfer Notice.
representative of any shareholder, desires to Allocation
sell or to transfer any of the shares which are (2) After the receipt of replies from all Other
held by him or her (the “Proposing Shareholders or on the day after the Expiry
Transferor”), then he or she must first offer Date (whichever is the earlier), the Board
them for sale to the shareholders other than must allocate the shares to those Other
the Proposing Transferor (the “Other Shareholders who are willing to purchase the
Shareholders”) or to any other person shares at the Transferor’s Valuation and, if
nominated by the board (“Board Nominee”) in more than one, then in proportion to their
accordance with clauses 11.1 to 11.9; and existing shareholding in that class.
(b) Any shares offered in accordance with (3) Subject to clause 11.4(1) if no Other
paragraph (a) must be offered for sale: Shareholder is willing to take all or any of the
(i) At the Transferor’s Valuation in accordance shares, then the shares which are not
with clause 11.2(2)(a); or purchased by the Other Shareholders must be
(ii) At the Fair Value in accordance with allocated by the board to Board Nominees
clause 11.4; and who are willing to purchase them.
(c) Any offer to sell made as provided in this
clause may be withdrawn by the Proposing Fair Value
Transferor if the Fair Value is not acceptable 11.4. (1) Notwithstanding clause 11.3(3), if no
to the Proposing Transferor. Other Shareholder is willing to take all or any
of the shares at the Transferor’s Valuation but
Transfer Notice, Transferor’s Valuation there is an Other Shareholder who is prepared
11.2. (1) Except where the transfer is made to purchase the shares or the balance of the
pursuant to clause 11.10 or clause 11.11 or shares at a lesser figure than the Transferor’s
clause 11.12, the Proposing Transferor must Valuation, then the Fair Value must be fixed
serve notice (a “Transfer Notice”) on the on the application of either party:
board that he or she desires to transfer the (a) By a person (“the Expert”) to be nominated
shares. by the Chair of the Executive Board of the
(2) The Transfer Notice: New Zealand Institute of Chartered
(a) Must specify the sum which the Proposing Accountants; or
Transferor considers to be the value of the (b) If for any reason that president fails to
shares (the “Transferor’s Valuation”); and make a nomination, then by a person (“the
(b) Deems the board (subject as is hereinafter Expert”) to be nominated by the President of
provided) the Proposing Transferor’s agent for the Arbitrators’ and Mediators’ Institute of New
Zealand Inc. Settlement
(2) The Expert in certifying the Fair Value of (4) Within 28 days commencing on the date
the shares is an expert and not an arbitrator. the board allocated the shares (if at the
Accordingly the Arbitration Act 1996 does not Transferor’s Valuation), or within 28 days
apply. The value fixed by the Expert is the commencing on the Expiry Date (if at the Fair
“Fair Value”. Value), whichever occurs later:
(3) If the Fair Value needs to be fixed, then (a) The purchasers must tender the price of
the Expiry Date is the day 14 days from the the shares to the Proposing Transferor; and
date on which the Expert reported the Fair (b) The Proposing Transferor must tender to
Value to the board. the purchasers in return the signed share
(4) The rights given to parties other than the transfer and the relevant share certificate (if
Proposing Transferor by this clause 11 are any).
options only and do not constitute obligations
to purchase. Board may execute transfer
(5) Forthwith upon fixing the Fair Value, the 11.7. (1) If the Proposing Transferor, after
Expert must report it to the board. becoming bound in accordance with clause
(6) Forthwith on receipt of the Fair Value from 11.6(2), does not transfer the shares in
the Expert, the board must: accordance with clause 11.6(4)(b), then:
(a) Serve notice specifying the Fair Value on (a) The board may execute transfers of the
the Proposing Transferor; and shares on behalf of the Proposing Transferor;
(b) Serve on each of the Other Shareholders and
an amended Pre-emption Notice stating the (b) The board may receive the purchase
Fair Value and the amended Expiry Date. money.
(2) Upon receipt of the purchase money the
Part acceptance not effective board:
11.5. (1) The offer of the Proposing Transferor (a) Must cause the names of the transferees
may consist of all or part of the shares which to be entered in the share register as the
are held by him or her. holders; and
(2) If the Transfer Notice includes several (b) Must hold the purchase money (subject to
shares: any lien in favour of the company) in trust for
(a) The Proposing Transferor need not sell or the Proposing Transferor.
transfer part only of the shares specified in the (3) The board’s receipt is a good discharge to
Transfer Notice; and the transferees for the purchase price.
(b) The Proposing Transferor may revoke the (4) No question may be raised as to the title of
Transfer Notice unless it is accepted in the transferees to the shares after they are
respect of all the shares which are offered by registered as the holders.
him or her.
If no buyers
Revocation of Transfer Notice 11.8. If the board does not, within a period of
11.6. (1) If the Fair Value is less than the 28 days commencing on the Expiry Date,
Transferor’s Valuation, then the Proposing serve on the Proposing Transferor notice that
Transferor may revoke the Transfer Notice. it has found an Other Shareholder or Board
The revocation must be in writing and served Nominee who is willing to purchase the
on the board not less than 7 days before the shares, then the Proposing Transferor may
Expiry Date. (within 3 months commencing on the Expiry
(2) If the Proposing Transferor fails to revoke Date) sell and transfer the shares to any
the Transfer Notice within the time specified in person at a price which is not lower than the
subclause (1), then it remains in full force and lesser of:
effect and the Proposing Transferor is bound (a) The Transferor’s Valuation; or
by it. (b) The Fair Value.
(3) Except as provided in this clause 11.6 and
in clause 11.5, the Transfer Notice is Assignee to sell shares to shareholders
revocable only by resolution of the board. 11.9. If a shareholder is adjudicated bankrupt
or any steps are taken to appoint a receiver or (2) This clause does not release the estate of
liquidator of the shareholder as the case may a deceased joint holder from any liability in
be, then that event deems the board the agent respect of any share which had been jointly
of the bankrupt shareholder (and of his or her held by him or her with other persons or
estate in bankruptcy): constitute a release of any lien which the
(a) To serve on the board a Transfer Notice; company may have in respect of any share.
and
(b) To sell the shares at the Fair Value as Election of registration
provided in clauses 11.1 to 11.8. 12.2. (1) Any person becoming entitled to a
share in consequence of the death or
Transfer by personal representatives bankruptcy of a shareholder may (upon
11.10. (1) Any share of a deceased whatever evidence being produced as is
shareholder may be transferred by his or her properly required by the board and subject to
executors, administrators, or trustees to any the following provisions) elect either:
child or other issue, adopted child, stepchild, (a) To be registered him- or herself as holder
son-in-law, daughter-in-law, widow, or of the share; or
widower of the deceased shareholder. (b) To have some person nominated by him or
(2) The restrictions in clauses 11.1 to 11.9 do her to be registered as the transferee of the
not apply to any transfer under this clause. share.
(2) However the board, in either case, has the
Approval by all shareholders same right to decline or suspend registration
11.11. (1) Any share may be transferred by a as it would have had in the case of a transfer
shareholder to any person if the instrument of of the share by that shareholder before his or
transfer is approved, or if the proposed her death or bankruptcy.
transferees are approved, in writing by all the
shareholders. Upon election
(2) The restrictions in clauses 11.1 to 11.9 do 12.3. (1) If the person so becoming entitled
not apply to any transfer under this clause. elects to be registered him- or herself, then he
or she must deliver or send to the company a
Permitted transfers notice in writing signed by him or her stating
11.12. Any share may be transferred free of that he or she so elects.
the restrictions in clauses 11.1 to 11.9 by any (2) If he or she elects to have another person
shareholder to any of the following: registered, then he or she must testify to his or
(a) A child, grandchild, wife or husband of the her election by:
shareholder. (a) Executing in favour of that person a
(b) A trustee of any trust that in the opinion of transfer of the share; and
the board is principally for the benefit of the (b) Causing the transfer to be tendered to the
shareholder or one or more of the above board for registration.
persons. Provisions continue to apply
(c) Another trustee of an above mentioned (3) All the limitations, restrictions, and
trust in the event of a change in trustees. provisions of this constitution relating to the
right to transfer and the registration of
12. TRANSMISSION OF SHARES transfers of shares including the provisions of
clauses 11.1 to 11.9 are applicable to any
Recognition of title on death of such notice or transfer as if:
shareholder (a) The death or bankruptcy of the
12.1. (1) If a shareholder dies, then the shareholder had not occurred; and
survivor(s) (where the deceased was a joint (b) The notice were a transfer signed by that
holder) and the legal personal representatives shareholder.
of the deceased (where he or she was a sole
holder) are the only persons recognised by Transfer of shares by operation of law
the company as having any title to his or her 12.4. Notwithstanding anything in this
interest in the shares. constitution, shares in the company may pass
by operation of law. not complied with, then any share in respect
[See section 86] of which the notice has been given may (at
any time afterwards, before the payment
Entitlement to dividends and rights required by the notice has been made) be
12.5. (1) Where the registered holder of any forfeited by a resolution of the board to that
share dies or becomes bankrupt, then his or effect.
her personal representative or the assignee of (2) The forfeiture includes all dividends which
his or her estate (upon the production of are declared in respect of the forfeited shares
whatever evidence is properly required by the and not paid before the forfeiture.
board) is entitled to:
(a) The same dividends and other Disposal of forfeited share
advantages; and 13.4. (1) A forfeited share may be sold, or
(b) The same rights (whether in relation to otherwise disposed of, on whatever terms and
meetings of the company, or to voting, or in whatever manner the board resolves.
otherwise); (2) At any time before a sale or disposition the
as the registered holder would have been forfeiture may be cancelled on whatever terms
entitled to if he or she had not died or become the board resolves.
bankrupt.
Joint entitlement Liability in respect of forfeited shares
(2) Where 2 or more persons are jointly 13.5. (1) A person whose shares have been
entitled to any share in consequence of the forfeited ceases to be a shareholder in respect
death of the registered holder they are, for the of the forfeited shares, but remains liable to
purposes of this constitution, deemed to be pay to the company:
joint holders of the share. (a) All money which, at the date of forfeiture,
was payable by him or her to the company in
13. FORFEITURE AND SURRENDER OF respect of the shares; and
SHARES (b) Costs and expenses incurred by the
company in connection with:
Failure to pay call or instalment (i) The forfeiture of the shares; and
13.1. If a shareholder fails to pay any call (or (ii) The attempts to enforce payment of the
instalment of a call) on the day which is calls or instalments.
appointed for payment of it, then the board (2) The board may waive all or part of the
may (at any time afterwards during the time payment of the costs and expenses.
any part of the call or instalment remains (3) Such liability ceases if and when the
unpaid) serve a notice on the shareholder company receives payment in full of all the
which requires payment of: money which is specified in this clause in
(a) The amount of the call or instalment which respect of the shares.
is unpaid; and
(b) Any interest which has accrued. Notice of forfeiture
13.6. On the forfeiture of any share the board
Notice of default must:
13.2. (1) The notice must name a further day (a) Cause a note of the forfeiture and of the
(not earlier than the expiration of 14 days date of the forfeiture to be entered in the
commencing on the date of service of the share register; and
notice) on or before which the payment (b) Cause notice of the forfeiture and of the
required by the notice is to be made. date of the forfeiture to be given to the
(2) The notice must state that if the payment shareholder in whose name the share stood in
is not made at or before the time appointed, the share register immediately before the
then the shares in respect of which the call forfeiture; and
was made will be liable to be forfeited. (c) Upon the disposal of any forfeited share,
cause a note of the manner and of the date of
Forfeiture on non-compliance the disposal to be similarly entered.
13.3. (1) If the requirements of the notice are
Declaration of forfeiture (2) The details of payment are as follows:
13.7. A statutory declaration in writing that: (a) The consideration for each class of share
(a) The declarant is a director or the secretary is that specified in the schedule. If no
of the company; and consideration is so specified, then the
(b) A share in the company has been duly consideration is $1 per share.
forfeited on a date stated in the declaration; (b) The date of payment of that consideration
is conclusive evidence of the facts stated in is that specified in the schedule. If no date of
the declaration as against all persons who payment is so specified, then the
claim to be entitled to the share. consideration must be paid on the date for
payment which is resolved by the board. The
Consideration for and transfer of forfeited payment does not fall due until the board has
share given the shareholder not less than 7 days’
13.8. (1) The company may receive the notice (commencing on the day the
consideration, if any, which is given for a shareholder is served) of the resolution.
forfeited share on any sale or other disposition (c) The place of payment is that specified in
of the share. the schedule. If no place of payment is so
(2) The company may execute a transfer of specified, then the place of payment is the
the share in favour of the person to whom the registered office of the company.
share is sold or disposed of. Amalgamated company
(3) The company must thereupon register the (3) The company must, in the case of an
transferee as the holder of the share. amalgamated company, forthwith after the
(4) The transferee need not see to the amalgamation is effective, issue to any person
application of the purchase money, if any. entitled to a share or shares under the
(5) The transferee’s title to the share is not amalgamation proposal the share or shares to
affected by any irregularity or invalidity in the which that person is entitled.
proceedings in reference to the forfeiture, [See sections 41 and 46A]
sale, or disposal of the share.
Issue of other shares
Sums due other than calls 14.3. Subject to the Act and approval by
13.9. These clauses as to forfeiture apply in special resolution, the board may issue shares
the case of non-payment of any sum which at any time and in any number if:
(by the terms of issue of a share) becomes (a) The shares belong to a class provided for
payable at a fixed time, as if the sum had in this constitution; and
been payable by virtue of a call duly made (b) The number of shares does not exceed the
and notified. maximum number of shares that may, under
this constitution, be issued in that class of
14. ISSUE OF NEW SHARES shares; and
(c) The provisions of this constitution relating
Time of issue of shares to the issue of shares are complied with.
14.1. A share is issued when the name of the [See section 42]
holder is entered on the share register.
[See section 51] Shareholder approval for issue of new
shares
Issue of shares on registration or 14.4. (1) Notwithstanding clause 14.3, if
amalgamation shares cannot be issued by reason of any
14.2. (1) The company must, forthwith after limitation or restriction elsewhere in this
registration of the company, issue to the constitution, then the board may issue shares
persons named in the application for if the board obtains the approval for the issue
registration as shareholders the number of in the same manner as approval is required
shares specified in the application as being for an alteration to this constitution that would
the number of shares to be issued to those permit such an issue.
persons. (2) Subject to the terms of the approval, the
Details of payment shares may be issued at any time, to any
person, and in any number the board thinks (6) Nothing contained in this clause prevents
fit. the board from issuing (either as fully paid up
(3) Within 10 working days of approval being or partly paid up) any shares in payment or in
given under subclause (1), the board must part payment for the purchase of any assets
ensure that notice of that approval in the or in satisfaction or part satisfaction of any
prescribed form is delivered to the Registrar obligation into which the company has entered
for registration. or agreed to enter.
(4) Nothing in this clause affects the need to [See sections 45 and 46]
obtain the approval of an interest group in
accordance with clause 4.4 if the issue affects Consideration
the rights of that interest group. 14.7. (1) Before the board issues shares
[See section 44] under clause 14.3 or clause 14.4, the board
must:
Same conditions apply to new shares (a) Decide the consideration for which the
14.5. New shares are subject to the same shares will be issued and the terms on which
provisions with reference to the payment of they will be issued; and
calls, liens, transfer, transmission, forfeiture, (b) If the shares are to be issued other than
and otherwise as the shares in the original for cash, determine the reasonable present
share capital. cash value of the consideration for the issue;
and
Entitlement to new shares (c) Resolve that, in its opinion, the
14.6. (1) Shares issued or proposed to be consideration for and terms of issue are fair
issued that rank or would rank as to voting or and reasonable to the company and to all
distribution rights (or both), equally with or existing shareholders; and
prior to shares already issued by the (d) If the shares are to be issued other than
company, must be offered for acquisition to for cash, resolve that, in its opinion, the
the holders of the shares already issued in a present cash value of the consideration to be
manner and on terms that would, if accepted, provided for the issue of the shares is not less
maintain the existing voting or distribution than the amount to be credited for the issue of
rights (or both) of those holders. the shares.
(2) The offer must be made by notice Directors’ certificate
specifying the number of shares to which the (2) The directors who vote in favour of a
shareholder is entitled and limiting a time resolution under subclause (1) must sign a
within which the offer, if not accepted, is certificate:
deemed to be declined. (a) Stating the consideration for, and the
(3) The offer must remain open for terms of, the issue; and
acceptance for a reasonable time. (b) Describing the consideration in sufficient
Offer not accepted detail to identify it; and
(4) After the expiration of that time or on the (c) Where a present cash value has been
receipt of an intimation from the shareholder determined in accordance with subclause (1)
to whom such notice is given that he or she (b), stating that value and the basis for
declines to accept the shares offered, the assessing it; and
board must offer those shares proportionately (d) Stating that, in their opinion, the
to the other then existing shareholders. consideration for and terms of issue are fair
Shares which cannot be reasonably and reasonable to the company and to all
offered existing shareholders; and
(5) The board may dispose of any new shares (e) If the shares are to be issued other than
which (by reason of the ratio which the new for cash, stating that, in their opinion, the
shares bear to shares held by persons entitled present cash value of the consideration to be
to an offer of the new shares) cannot, in the provided for the issue of the shares is not less
opinion of the board, be reasonably offered than the amount to be credited for the issue of
under this clause. the shares.
Payment for assets Present cash value resolution
(3) Before shares that have already been is approved by a simple majority of the votes
issued are credited as fully or partly paid up of those shareholders entitled to vote and
other than for cash, the board must: voting on the question.
(a) Determine the reasonable present cash [See section 105]
value of the consideration; and
(b) Resolve that, in its opinion, the present Special resolutions
cash value of the consideration is: 15.3. (1) When shareholders exercise a power
(i) Fair and reasonable to the company and to to:
all existing shareholders; and (a) Adopt a constitution, or alter or revoke the
(ii) Not less than the amount to be credited in constitution;
respect of the shares. (b) Approve a major transaction;
Directors’ certificate (c) Approve an amalgamation of the company
(4) The directors who vote in favour of a under section 221;
resolution under subclause (3) must sign a (d) Put the company into liquidation;
certificate: the power must be exercised by special
(a) Describing the consideration in sufficient resolution.
detail to identify it; and (2) A special resolution pursuant to
(b) Stating: paragraphs (a), or (b), or (c) can be rescinded
(i) The present cash value of the only by a special resolution.
consideration and the basis for assessing it; (3) A special resolution pursuant to paragraph
and (d) cannot be rescinded.
(ii) That the present cash value of the (4) A special resolution is a resolution
consideration is fair and reasonable to the approved by a majority of 75 percent of the
company and to all existing shareholders; and votes of those shareholders entitled to vote
(iii) That the present cash value of the and voting on the question.
consideration is not less than the amount to [See sections 2 and 106]
be credited in respect of the shares.
Certificate to Registrar Unanimous shareholder agreements
(5) The board must deliver a copy of a 15.4. (1) Notwithstanding clause 18.1 but
certificate that complies with subclause (2) or subject to clause 15.5, if all entitled persons
subclause (4) to the Registrar for registration have agreed or concur:
within 10 working days after it is given. (a) A dividend may be authorised otherwise
[See section 47] than in accordance with clause 18.2;
(b) A discount scheme may be approved
PART 5. SHAREHOLDERS otherwise than in accordance with clause
18.7;
15. SHAREHOLDER POWERS (c) Shares in the company may be acquired
otherwise than in accordance with sections 58
Powers reserved to shareholders to 65;
15.1. Powers reserved to the shareholders by (d) Shares in the company may be redeemed
the Act may be exercised only: otherwise than in accordance with sections 69
(a) At a meeting of shareholders pursuant to to 72;
clause 16.1 or clause 16.2; or (e) Financial assistance may be given for the
(b) By a resolution in lieu of a meeting purpose of, or in connection with, the
pursuant to clause 16.3. purchase of shares otherwise than in
[See section 104] accordance with sections 76 to 80;
(f) Any of the matters referred to in clause
Ordinary resolutions 27.2(1) may be authorised otherwise than in
15.2. (1) Unless otherwise specified in the Act accordance with that clause.
or this constitution, a power reserved to Issue of shares
shareholders may be exercised by an ordinary (2) If all entitled persons have agreed or
resolution. concur, shares may be issued otherwise than
(2) An ordinary resolution is a resolution that in accordance with clause 14.3, or clause
14.4, or clause 14.6. power is deemed not to have been authorised.
Director’s interest [See sections 4 and 108]
(3) If all entitled persons have agreed to or
concur in the company entering into a Management review by shareholders
transaction in which a director is interested, 15.6. (1) The chairperson of a meeting of
nothing in clauses 21.3 and 21.4 applies to shareholders must allow a reasonable
that transaction. opportunity for shareholders at the meeting to
In writing question, discuss, or comment on the
(4) For the purposes of this clause, no management.
agreement or concurrence of the entitled Resolution
persons is valid or enforceable unless the (2) A meeting of shareholders may pass a
agreement or concurrence is in writing. resolution under this clause relating to the
Particular or general management.
(5) An agreement or concurrence may be: Not binding
(a) A separate agreement to, or concurrence (3) Unless this constitution elsewhere
in, the particular exercise of the power provides, a resolution passed pursuant to
referred to; or subclause (2) is not binding on the board.
(b) An agreement to, or concurrence in, the [See section 109]
exercise of the power generally or from time
to time. Minority buy-out rights
Withdrawal 15.7. Where:
(6) An entitled person may, at any time, by (a) A shareholder is entitled to vote on the
notice in writing to the company, withdraw exercise of 1 or more of the powers in:
from any agreement or concurrence referred (i) Clause 15.3(1)(a), and the proposed
to in subclause (5)(b), and any such notice alteration in the constitution imposes or
takes effect accordingly. removes a restriction on the activities of the
Notice company; or
(7) Where a power is exercised pursuant to an (ii) Clause 15.3(1)(b) or clause 15.3(1)(c); and
agreement or concurrence referred to in (b) The shareholders resolved, pursuant to
subclause (5)(b), the board must, within 10 clause 15.3, to exercise the power; and
working days of the exercise, send to every (c) The shareholder cast all the votes
entitled person a notice in writing containing (attached to shares registered in the
details of the exercise. shareholder’s name and having the same
[See section 107] beneficial owner) against the exercise of the
power; or
Solvency test (d) The resolution was passed under clause
15.5. (1) A power referred to in clause 15.4(1) 16.3 and the shareholder did not sign the
must not be exercised unless the board is resolution;
satisfied on reasonable grounds that the that shareholder is entitled to require the
company will, immediately after the exercise, company to purchase those shares in
satisfy the solvency test. accordance with clause 15.9.
Certificate [See section 110]
(2) The directors who vote in favour of the
exercise must sign a certificate stating that, in Interest groups buy-out rights
their opinion, the company will, after the 15.8. Where:
exercise, satisfy the solvency test. (a) An interest group has, under clause 4.4,
Change in circumstances approved, by special resolution, the taking of
(3) If, after a resolution is passed under action that affects the rights attached to
subclause (1) and before the power is shares; and
exercised, the board ceases to be satisfied on (b) The company becomes entitled to take the
reasonable grounds that the company will, action; and
immediately after the power is exercised, (c) A shareholder who was a member of the
satisfy the solvency test, any exercise of the interest group cast all the votes (attached to
shares registered in that shareholder’s name annual meeting of shareholders under this
and having the same beneficial owner) clause 16.1 and section 120 if:
against approving the action; or (a) There is nothing required to be done at
(d) The resolution approving the taking of the that meeting; and
action was passed under clause 16.3 and a (b) The board has resolved that it is in the
shareholder who was a member of the interests of the company to rely on s 120(5)
interest group did not sign the resolution; (having regard to whether there is any
that shareholder is entitled to require the particular issue that the shareholders should
company to purchase those shares in be given an opportunity to discuss, comment
accordance with clause 15.9. on, or ask questions about); and
[See section 118] (c) Other provisions of this constitution do not
require the meeting to be called or held.
Notice requiring purchase (6) Subclauses (1) to (4) are subject to
15.9. (1) A shareholder who is entitled to subclause (5).
require the company to purchase shares by [See section 120]
virtue of clause 15.7 or clause 15.8 may:
(a) Within 10 working days of the passing of Special meetings of shareholders
the resolution at a meeting of shareholders; or 16.2. A special meeting of shareholders
(b) Where the resolution was passed under entitled to vote on an issue:
clause 16.3, before the expiration of 10 (a) May be called at any time by:
working days after the date on which notice of (i) The board; or
the passing of the resolution is given to the (ii) A person who is authorised by this
shareholder; constitution to call the meeting;
give a written notice to the company requiring (b) Must be called by the board on the written
the company to purchase those shares. request of shareholders holding shares
(2) Within 20 working days of receiving a carrying together not less than 5 percent of
notice under subclause (1), the board must the voting rights entitled to be exercised on
comply with section 111(2). the issue.
[See section 111] [See section 121]

16. MEETINGS AND RESOLUTIONS Resolution in lieu of meeting

16.3. (1) Subject to subclauses (2) and (3), a
Annual meeting of shareholders resolution in writing signed by not less than:
(a) 75 percent; or
When held (b) Such other percentage as this constitution
16.1. (1) The board must call an annual may require for passing a special resolution;
meeting of shareholders to be held: whichever is the greater, of the shareholders
(a) who would be entitled to vote on that
not later than 6 months after the balance date resolution at a meeting of shareholders who
of the company; and together hold not less than 75 percent or, if a
(b) Not later than 15 months after the previous higher percentage is required by this
annual meeting. constitution, that higher percentage, of the
(2) The company does not have to hold its votes entitled to be cast on that resolution, is
first annual meeting in the calendar year of its as valid as if it had been passed at a meeting
registration, but must hold that meeting within of those shareholders.
18 months of its registration. Required decision: shareholders entitled
(3) The company must hold the meeting on (2) A resolution in writing that:
the date on which it is called to be held. (a) Relates to a matter that is required by the
Time and place Act or by this constitution to be decided at a
(4) The annual meeting must be held at such meeting of the shareholders of the company;
time and place as the directors appoint. and
When meeting not required (b) Is signed by all the shareholders specified
(5) It is not necessary for the board to call an in subclause (3);
is made in accordance with the Act and this (d) If the board fixes a date for the purpose,
constitution. those shareholders whose names are
Which shareholders entitled registered in the share register on that date;
(3) For the purposes of subclause (2)(b), the (e) If the board does not fix a date for the
shareholders are: purpose, those shareholders whose names
are registered in the share register on the day
(a) In the case of a resolution under section on which the board passes the resolution
207I or 207J, the shareholders who together concerned.
hold not less than 95% of the votes entitled to Date under subclause (1)
be cast on the resolution; (2) A date must not be fixed under subclause
(b) In any other case, the shareholders (1) that precedes by more than 20 working
referred to in subclause (1). days the date on which the proposed action
(3A) For the purposes of subclause (2), any will be taken.
such resolution may consist of 1 or more Notice required
documents in similar form (including letters, (3) The shareholders who are entitled to
telegrams, cables, facsimiles, telex receive notice of a meeting of shareholders
messages, electronic mail, or other similar are:
means of communication) each signed or (a) If the board fixes a date for the purpose,
assented to by or on behalf of 1 or more of the those shareholders whose names are
shareholders specified in subclause (3). registered in the share register on that date;
Resolution in lieu of annual meeting (b) If the board does not fix a date for the
(4) The company need not hold an annual purpose, those shareholders whose names
meeting of shareholders under clause 16.1 if are registered in the share register at the
everything required to be done at that meeting close of business on the day immediately
(by resolution or otherwise) is done by preceding the day on which the notice is
resolution in accordance with subclauses (2) given.
and (3). Clause 16.1(5) does not limit this Date under subclause (3)
clause 16.2(4). (4) A date must not be fixed under subclause
Copy to non-signatory (3) that precedes by more than 30 working
(5) Within 5 working days of a resolution being days or less than 10 working days the date on
passed under this clause, the company must which the meeting is to be held.
send to every shareholder who did not sign [See section 125]
the resolution or on whose behalf the
resolution was not signed: 17. PROCEEDINGS AT MEETINGS OF
(a) a copy of the resolution; and SHAREHOLDERS
(b) if the resolution was a special resolution [See Schedule 1]
required by section 106(1)(a) or (b), a Chairperson
statement setting out the rights of 17.1. (1) If the directors have elected a
shareholders under section 110. chairperson of the board, and the chairperson
Notice not required of the board is present at a meeting of
(6) A resolution may be signed under shareholders, then he or she must chair the
subclauses (1) or (2) without any prior notice meeting.
being given to shareholders. If chairperson not present
[See section 122] (2) If no chairperson of the board has been
elected or if, at any meeting of shareholders,
Ascertaining shareholders the chairperson of the board is not present
16.4. (1) The shareholders who are entitled to: within 15 minutes of the time appointed for the
(a) Receive distributions; or commencement of the meeting, then:
(b) Exercise pre-emptive rights to acquire (a) The directors who are present must elect 1
shares in accordance with clause 14.6; or of their number to be chairperson of the
(c) Exercise any other right or receive any meeting;
other benefit under the Act or this constitution; (b) If no director is present within 15 minutes
are: of the time appointed for the commencement
of the meeting, then the shareholders present all shareholders participating and constituting
may choose 1 of their number to be a quorum can simultaneously hear each other
chairperson of the meeting. throughout the meeting; or
(c) a combination of (a) and (b) above.
Notice of meetings
17.2. (1) Written notice of the time and place Quorum of shareholders
of a meeting of shareholders must be sent to 17.4. (1) Subject to subclause (3), no
every shareholder entitled to receive notice of business may be transacted at a meeting of
the meeting and to every director and an shareholders if a quorum is not present.
auditor of the company not less than 10 (2) A quorum for a meeting of shareholders is
working days before the meeting. present if shareholders or their proxies are
Contents present or have cast postal votes who
(2) The notice must state: between them:
(a) The nature of the business to be (a) Total the number specified in the schedule
transacted at the meeting in sufficient detail to in clause 1.1; or
enable a shareholder to form a reasoned (b) If no number is specified, then are able to
judgment in relation to it; and exercise a majority of the votes to be cast on
(b) The text of any special resolution to be the business to be transacted by the meeting.
submitted to the meeting. If no quorum
Waiver (3) If a quorum is not present within 30
(3) An irregularity in a notice of a meeting is minutes after the time appointed for the
waived if all the shareholders entitled to meeting:
attend and vote at the meeting attend the (a) In the case of a meeting called under
meeting without protest as to the irregularity, clause 16.2(b) (section 121(b), the meeting is
or if all such shareholders agree to the waiver. dissolved;
Adjournment (b) In the case of any other meeting, the
(4) The chairperson may (and if so directed by meeting is adjourned to the same day in the
the meeting must) adjourn the meeting from following week at the same time and place, or
time to time and from place to place. No to such other date, time, and place as the
business may be transacted at any adjourned directors may appoint, and if, at the adjourned
meeting except the business which was left meeting, a quorum is not present within 30
unfinished at the meeting which was minutes after the time appointed for the
adjourned. If a meeting is adjourned for 30 meeting, the shareholders present or their
days or more, then notice of the adjourned proxies are a quorum.
meeting must be given in the same way as for
an original meeting. Except as above, it is not Voting
necessary to give notice of an adjournment or 17.5. (1) In the case of a meeting of
of the business which is to be transacted at an shareholders held under clause 17.3(a),
adjourned meeting. unless a poll is demanded, voting at the
Omission of notice meeting shall be by whichever of the following
(5) The proceedings of a meeting are not methods is determined by the chairperson of
invalidated by the accidental omission to give the meeting:
notice of the meeting to a person who is (a) Voting by voice; or
entitled to receive notice of it, or by non- (b) Voting by show of hands.
receipt of the notice by such a person. (2) In the case of a meeting of shareholders
held under clause 17.3(b) or 17.3(c), unless a
Methods of holding meetings poll is demanded, voting at the meeting shall
17.3. A meeting of shareholders may be held be by the shareholders signifying individually
by a quorum of shareholders: their assent or dissent by voice or any other
(a) being assembled together at the place, method permitted by the chairperson of the
date, and time appointed for the meeting; or meeting.
(b) participating by means of audio, audio and Chairperson’s declaration conclusive
visual, or electronic communication by which (3) A declaration by the chairperson of the
meeting that a resolution is carried by the demanded.
requisite majority is conclusive evidence of (13) A poll which is demanded upon the
that fact unless a poll is demanded in election of a chairperson or upon a question of
accordance with subclause (4). adjournment must be taken forthwith. A poll
Right to poll which is demanded upon any other question
(4) At a meeting of shareholders a poll may be must be taken at whatever time and place the
demanded by: chairperson directs. Any business except that
(a) Not less than 5 shareholders having the on which a poll has been demanded may
right to vote at the meeting; or proceed pending the poll being taken.
(b) A shareholder or shareholders
representing not less than 10 percent of the Proxies
total voting rights of all shareholders having 17.6. (1) A shareholder may exercise the right
the right to vote at the meeting; or to vote either by being present in person or by
(c) By a shareholder or shareholders holding proxy.
shares in the company that confer a right to (2) A proxy for a shareholder is entitled to
vote at the meeting and on which the attend and be heard at a meeting of
aggregate amount paid up is not less than 10 shareholders as if the proxy were the
percent of the total amount paid up on all shareholder.
shares that confer that right; or (3) A proxy must be appointed by notice in
(d) The chairman of the meeting. writing signed by or, in the case of an
(5) A poll may be demanded either before or electronic communication, sent by the
after the vote is taken on a resolution. shareholder and the notice must state whether
(6) If a poll is taken, votes must be counted the appointment is for a particular meeting or
according to the votes attached to the shares a specified term. A shareholder may appoint
of each shareholder present in person or by more than one proxy for a particular meeting
proxy and voting. provided that more than one proxy is not
No casting vote appointed to exercise the rights attached to a
(7) The chairperson of a shareholders’ particular share held by the shareholder.
meeting is not entitled to a casting vote. (4) No proxy is effective in relation to a
Right of proxy meeting unless a copy of the notice of
(8) For the purposes of this clause, the appointment is produced before the start of
instrument appointing a proxy to vote at a the meeting.
meeting of the company confers authority to Proxy with notice of meeting
demand or join in demanding a poll, and a (5) With the notice of meeting the board must
demand by a person as proxy for a include the form of proxy in subclause (6)(c).
shareholder has the same effect as a demand Form of proxy
by the shareholder. (6) The instrument which appoints a proxy
One vote may be:
(9) Subject to any rights or restrictions (a) In any usual or common form; or
attached to any class of shares, every (b) In any form which the directors approve; or
shareholder who is present in person or by (c) In the following form:
proxy, and who votes by voice or show of …………. Limited
hands, has 1 vote. I/We*, ………….
Poll of ……………..
(10) The chairperson may demand a poll on a being a shareholder/shareholders* of the
resolution, either before or after a vote on it, above-named company, hereby appoint
whether by voice or by show of hands. ……………..
(11) The demand for a poll may be withdrawn. of ………… or failing him or her, …………..
(12) Save as in subclause (13), should a poll of ………….
be demanded, it must be taken in the manner as my/our* proxy to vote for me/us* on
in which the chairperson directs, and the my/our* behalf:
result of the poll is deemed to be the (a) at the annual/special* meeting of the
resolution of the meeting at which the poll was shareholders to be held on the and at any
adjournment of the meeting; or (b) In relation to each resolution to be voted
(b) For a term of ……….. commencing on the on at the meeting, to count:
………day of ……………. (i) The number of shareholders voting in
Signed this ………. day of ………. favour of the resolution and the number of
votes cast by each shareholder in favour of
This form is to be used in favour of/against* the resolution; and
the resolution. [Specify each resolution] (ii) The number of shareholders voting against
Unless otherwise instructed, the proxy will the resolution, and the number of votes cast
vote as he or she thinks fit. by each shareholder against the resolution;
* Strike out whichever is not desired. and
(c) To sign a certificate that he or she has
Delete the option that is not required carried out the duties set out in paragraphs (a)
…………………………………………………… and (b) of this subclause and which sets out
………………… the results of the counts required by
paragraph (b) of this subclause; and
DATED (d) To ensure that the certificate required by
*Delete whichever is not desired. paragraph (c) of this subclause is presented to
the chairperson of the meeting.
Postal votes Chairperson’s duty
17.7. (1) A shareholder may exercise the right (6) If a vote is taken at a meeting on a
to vote at a meeting by casting a postal vote resolution on which postal votes have been
in accordance with this clause. cast, the chairperson of the meeting must:
Notice to state right (a) On a vote by show of hands, count each
(2) The notice of a meeting at which shareholder who has submitted a postal vote
shareholders are entitled to cast a postal vote for or against the resolution;
must state: (b) On a poll, count the votes cast by each
(a) That a shareholder may exercise the right shareholder who has submitted a postal vote
to vote at a meeting by casting a postal vote; for or against the resolution.
and (7) The chairperson of a meeting must call for
(b) The name of the person authorised by the a poll on a resolution on which he or she holds
board to receive and count postal votes at that sufficient postal votes where he or she
meeting. believes that if a poll is taken the result may
(3) If no person has been authorised to differ from that obtained on a show of hands.
receive and count postal votes at a meeting, (8) The chairperson of a meeting must ensure
or if no person is named as being so that a certificate of postal votes held by him or
authorised in the notice of the meeting, then her is annexed to the minutes of the meeting.
every director is deemed to be so authorised.
(4) A shareholder may cast a postal vote on Minutes
all or any of the matters to be voted on at the 17.8. (1) The board must ensure that minutes
meeting by sending a notice of the manner in are kept of all proceedings at meetings of
which his or her shares are to be voted to a shareholders.
person authorised to receive and count postal (2) Minutes which have been signed correct
votes at that meeting. A postal vote may be by the chairperson of the meeting are prima
cast using electronic means permitted by the facie evidence of the proceedings.
Board. The notice must reach that person not
less than 48 hours before the start of the Shareholder proposals
meeting. 17.9. (1) A shareholder may give written
Duty of counting notice to the board of a matter the shareholder
(5) It is the duty of a person authorised to proposes to raise for discussion or resolution
receive and count postal votes at a meeting: at the next meeting of shareholders at which
(a) To collect together all postal votes the shareholder is entitled to vote.
received by him or her, or by the company; Notice not less than 20 working days
and (2) If the notice is received by the board not
less than 20 working days before the last day proposed resolution are required to be met by
on which notice of the relevant meeting of the proposing shareholder, then the proposing
shareholders is required to be given by the shareholder must, on giving notice to the
board, then the board must, at the expense of board, deposit with the company or tender to
the company, give notice of the shareholder the company a sum sufficient to meet those
proposal and the text of any proposed costs.
resolution to all shareholders entitled to
receive notice of the meeting. Corporations may act by representatives
Notice between 5 and 20 working days 17.10. A body corporate which is a
(3) If the notice is received by the board not shareholder may appoint a representative to
less than 5 working days and not more than attend a meeting of shareholders on its behalf
20 working days before the last day on which in the same manner as that in which it could
notice of the relevant meeting of shareholders appoint a proxy.
is required to be given by the board, then the
board must, at the expense of the Votes of joint holders
shareholder, give notice of the shareholder 17.11. Where 2 or more persons are
proposal and the text of any proposed registered as the holder of a share, the vote of
resolution to all shareholders entitled to the person named first in the share register
receive notice of the meeting. and voting on a matter must be accepted to
Notice less than 5 working days the exclusion of the votes of the other joint
(4) If the notice is received by the board less holders.
than 5 working days before the last day on
which notice of the relevant meeting of Loss of voting rights if calls unpaid
shareholders is required to be given by the 17.12. Subject as provided elsewhere in this
board, then the board must, if practicable, and constitution, if a sum due to the company in
at the expense of the shareholder, give notice respect of a share has not been paid, that
of the shareholder proposal and the text of share may not be voted at a shareholders’
any proposed resolution to all shareholders meeting other than a meeting of an interest
entitled to receive notice of the meeting. group.
Shareholder’s statement
(5) If the directors intend that shareholders Other proceedings
may vote on the proposal by proxy or by 17.13. Except as provided in this clause 17
postal vote, then they must give the proposing and as elsewhere provided in this constitution,
shareholder the right to include in or with the a meeting of shareholders may regulate its
notice given by the board a statement of not own procedure.
more than 1,000 words prepared by the
proposing shareholder in support of the Vote before notice of revocation
proposal, together with the name and address 17.14. A vote given in accordance with the
of the proposing shareholder. terms of an instrument of proxy is valid
(6) The board is not required to include in or notwithstanding:
with the notice given by the board: (a) The previous death or insanity of the
(a) Any part of a statement prepared by a principal; or
shareholder that the directors consider to be (b) A revocation of the proxy or of the
defamatory (within the meaning of the authority under which the proxy was executed;
Defamation Act 1992), frivolous or vexatious; or
or (c) The transfer of the share in respect of
(b) Any part of a proposal or resolution which the proxy is given;
prepared by a shareholder that the directors if no notice in writing of the death, insanity,
consider to be defamatory (within the meaning revocation, or transfer has been received by
of the Defamation Act 1992). the company at the registered office before
If costs payable the commencement of the meeting or
(7) Where the costs of giving notice of the adjourned meeting at which the proxy is used,
shareholder proposal and the text of the or is presented at the meeting or adjourned
meeting before the vote is given. the identity of the shareholder, proxy, or
representative and that person’s approval or
Voting by mentally disordered and authentication (including electronic
protected persons authentication) of the information
Shareholder living in New Zealand communicated by electronic means).
17.15. (1) A shareholder who is a mentally (2) To avoid doubt, participation in a meeting
disordered person within the meaning of the includes participation in any manner permitted
Mental Health (Compulsory Assessment and by this constitution.
Treatment) Act 1992 may vote by his or her
manager or other person who has authority to 18. DISTRIBUTIONS TO SHAREHOLDERS
administer his or her estate.
(2) Subject to the provisions of a protection Solvency test
order which is made under the Protection of 18.1. (1) The board may (if it is satisfied on
Personal and Property Rights Act 1988, a reasonable grounds that the company will,
shareholder may vote in respect of any shares immediately after the distribution, satisfy the
that are subject to the protection order by the solvency test) subject to clause 18.2 and
manager appointed in that protection order. subject to any restrictions in this constitution,
(3) A shareholder may vote by his or her authorise a distribution by the company at a
protection attorney. time, and of an amount, and to any
(4) The manager, or other person with shareholders it thinks fit.
authority, may vote either on a show of hands Certificate
or on a poll, and, on a poll, may vote by proxy. (2) The directors who vote in favour of a
Shareholder living outside New Zealand distribution must sign a certificate stating that,
(5) Subclauses (6) and (7) apply in respect of in their opinion, the company will, immediately
shareholders who are not living in New after the distribution, satisfy the solvency test
Zealand and to whom subclauses (1) to (4) and the grounds for that opinion.
accordingly do not apply. Change in circumstances
(6) Every shareholder who is mentally (3) If, after a distribution is authorised and
disordered, or in respect of whom an order before it is made, the board ceases to be
has been made by any court which has satisfied on reasonable grounds that the
jurisdiction in mental disorder, may vote, company will, immediately after the
whether on a show of hands or on a poll, by distribution is made, satisfy the solvency test,
his or her committee, protection attorney, any distribution made by the company is
manager, receiver, curator bonis, or other deemed not to have been authorised.
person in the nature of a committee, Debts and liabilities
protection attorney, manager, receiver, or (4) In applying the solvency test for the
curator bonis appointed by that Court. purposes of this clause “debts” and “liabilities”
(7) The committee, protection attorney, have the meanings given in section 52(4).
manager, receiver, curator bonis, or other [See sections 4 and 52]
person may, on a poll, vote by proxy.
Dividends payable pari passu
Shareholder participation by electronic 18.2. (1) A dividend is a distribution other than
means a distribution to which clause 5.2 or clause 6.1
17.16. (1) For the purposes of this clause 17, applies.
a shareholder, or the shareholder’s proxy or (2) The board must not authorise a dividend:
representative, may participate in a meeting (a) In respect of some but not all the shares in
by means of audio, audio and visual, or a class; or
electronic communication if: (b) That is of a greater value per share in
(a) the board approves those means; and respect of some shares of a class than it is in
(b) the shareholder, proxy, or representative respect of other shares of that class;
complies with any conditions imposed by the unless the amount of the dividend in respect
board in relation to the use of those means of a share of that class is in proportion to the
(including, for example, conditions relating to amount paid to the company in satisfaction of
the liability of the shareholder under this portions of the period in respect of which the
constitution or under the terms of issue of the dividend is paid. If any share is issued on
share or is required, for a multi-rate PIE, by terms providing that it ranks for dividend as
section HM 48 of the Income Tax Act 2007. from a particular date, then that share ranks
(3) Notwithstanding subclause (2), a for dividend accordingly.
shareholder may waive his or her entitlement
to receive a dividend by notice in writing to the Deduction of shareholders’ debts
company signed by or on behalf of the 18.5. The board may deduct from any
shareholder. dividend payable to any shareholder all sums
[See section 53] of money, if any, presently payable by him or
her to the company on account of calls or
Bonus shares in lieu of dividend otherwise in relation to the shares of the
18.3. Subject as may be provided elsewhere company.
in this constitution, the board may issue
shares to any shareholders who have agreed Mode of payment
to accept the issue of shares, wholly or partly, 18.6. (1) Any dividend, interest, or other
in lieu of a proposed dividend or proposed money payable in cash in respect of shares
future dividends if: may be paid by cheque or warrant sent
(a) The right to receive shares, wholly or through the post directed to:
partly, in lieu of the proposed dividend or (a) The registered address of the holder; or
proposed future dividends has been offered to (b) In the case of joint holders, to the
all shareholders of the same class on the registered address of that one of the joint
same terms; and holders who is first named on the register of
(b) If all shareholders elected to receive the shareholders; or
shares in lieu of the proposed dividend, (c) To such person and to such address as
relative voting or distribution rights, or both, the holder or joint holders may in writing
would be maintained; and direct.
(c) The shareholders to whom the right is Payable to order
offered are afforded a reasonable opportunity (2) Every such cheque or warrant must be
of accepting it; and made payable to the order of the person to
(d) The shares issued to each shareholder are whom it is sent.
issued on the same terms and subject to the Joint holders
same rights as the shares issued to all (3) Any one of 2 or more joint holders may
shareholders in that class who agreed to give effectual receipts for any dividends,
receive the shares; and bonuses, or other money payable in respect of
(e) The provisions of clause 14.7 are complied the shares held by them as joint holders.
with by the board.
[See section 54] Shareholder discounts
18.7. (1) The board may resolve that the
Declared according to amount paid up company offer shareholders discounts in
18.4. (1) Subject to the rights of persons, if respect of some or all of the goods sold or
any, entitled to shares with special rights as to services provided by the company.
dividend, all dividends must be declared and Prior resolution
paid according to the amounts paid or (2) The board may approve a discount
credited as paid on the shares in respect of scheme under subclause (1) only if it has
which the dividend is paid. previously resolved that the proposed
(2) No amount paid or credited as paid on a discounts are:
share in advance of calls may be treated for (a) Fair and reasonable to the company and to
the purposes of this clause as paid on the all shareholders; and
share. (b) To be available to all shareholders or all
(3) All dividends must be apportioned and shareholders of the same class on the same
paid proportionately to the amounts paid or terms.
credited as paid on the shares during any Solvency test
(3) A discount scheme may not be approved order under section 30 or section 31 of the
or continued by the board unless it is satisfied Protection of Personal and Property Rights
on reasonable grounds that the company Act 1988.
satisfies the solvency test. (e) Any other person disqualified under
Not distribution section 151 of the Act.
(4) Subject to subclause (5), a discount [See section 151]
accepted by a shareholder under a discount
scheme approved under this clause is not a Director’s consent required
distribution for the purposes of the Act. 19.3. A person must not be appointed a
Change in circumstances director unless he or she has consented in
(5) Where: writing to be a director and certified that he or
(a) A discount is accepted by a shareholder she is not disqualified from being appointed or
under a scheme approved or continued by the holding office.
board; and [See section 152]
(b) At the time the scheme was approved or
the discount was offered, the board ceased to 20. POWERS OF DIRECTORS
be satisfied on reasonable grounds that the
company would satisfy the solvency test; Management of company
section 56 applies in relation to the discount, 20.1. (1) The business and affairs of the
with such modifications as may be necessary, company must be managed by, or under the
as if the discount were a distribution that is direction or supervision of, the board.
deemed not to have been authorised. (2) The board has all the powers necessary
[See sections 4 and 55] for managing, and for directing and
supervising the management of, the business
PART 6. MANAGEMENT and affairs of the company.
(3) Subclauses (1) and (2) are subject to any
19. APPOINTMENT AND REMOVAL OF modifications, exceptions, or limitations
DIRECTORS contained in the Act or elsewhere in this
constitution.
Appointment and removal of directors [See section 128]
19.1. (1) Directors may be appointed and
removed in the manner specified in the 21. SELF-INTEREST TRANSACTIONS
schedule in part 1 or as otherwise provided by
this constitution. Restrictions on self-interest transactions
Appointment need not be voted on 21.1. The directors must comply with sections
individually 139 to 149.
(2) The resolution to appoint directors need
not be for the appointment of 1 director. Meaning of “interested”
[See section 155] 21.2. (1) Subject to subclause (2), a director is
“interested” in a transaction to which the
Qualification company is a party if, and only if, the director:
19.2. (1) There is no shareholding (a) Is a party to, or will or may derive a
qualification for directors. material financial benefit from, the transaction;
(2) A natural person who is not disqualified by or
subsection (2) of section 151 may be (b) Has a material financial interest in another
appointed as a director of the company. party to the transaction; or
(3) The following are disqualified from being Director, officer, or trustee
appointed or holding office as a director: (c) Is a director, officer, or trustee of another
(a) A body corporate; party to, or person who will or may derive a
(b) A person who is under 18 years of age; material financial benefit from, the transaction,
(c) A person who is an undischarged not being a party or person that is:
bankrupt; (i) The company’s holding company being a
(d) A person who is subject to a property holding company of which the company is a
wholly-owned subsidiary; or transaction.
(ii) A wholly-owned subsidiary of the Failure to comply
company; or (3) A failure by a director to comply with
(iii) A wholly-owned subsidiary of a holding subclause (1) does not affect the validity of a
company of which the company is also a transaction entered into by the company or
wholly-owned subsidiary; or the director.
Parent, child, or spouse [See section 140]
(d) Is the parent, child, spouse, civil union
partner, or de facto partner of another party Avoidance of transactions
to, or person who will or may derive a material 21.4. (1) A transaction entered into by the
financial benefit from, the transaction; or company in which a director is interested may
Material interest be avoided by the company within 3 months of
(e) Is otherwise directly or indirectly materially the transaction being disclosed to all the
interested in the transaction. shareholders (whether by means of the
Security with no connection to director company’s annual report or otherwise).
(2) A director is not interested in a transaction (2) A transaction cannot be avoided if the
to which the company is a party if the company receives fair value under it.
transaction comprises only the giving by the [See sections 141 and 143]
company of security to a third party which has
no connection with the director, at the request Interested director may vote
of the third party, in respect of a debt or 21.5. A director who is interested in a
obligation of the company for which the transaction entered into, or to be entered into,
director or another person has personally by the company, may:
assumed responsibility in whole or in part (a) Vote on a matter relating to the
under a guarantee, indemnity, or by the transaction; and
deposit of a security. (b) Attend a meeting of directors at which a
[See section 139] matter relating to the transaction arises and
be included among the directors present at
Disclosure of interest the meeting for the purpose of a quorum; and
21.3. (1) A director must, forthwith after (c) Sign a document relating to the transaction
becoming aware of the fact that he or she is on behalf of the company; and
interested in a transaction or proposed (d) Do any other thing in his or her capacity as
transaction with the company, cause to be a director in relation to the transaction;
entered in the interests register, and, if the as if the director was not interested in the
company has more than 1 director, disclose to transaction.
the board: [See section 144]
(a) If the monetary value of the director’s
interest is able to be quantified, the nature 22. DUTIES OF DIRECTORS
and monetary value of that interest; or
(b) If the monetary value of the director’s Duty to act in good faith and in best
interest cannot be quantified, the nature and interests of company
extent of that interest. 22.1. A director, when exercising powers or
Shareholder, director, officer, or trustee performing duties, must act in good faith and
(2) For the purposes of subclause (1), a in what the director believes to be the best
general notice entered in the interests register interests of the company.
or disclosed to the board to the effect that a [See section 131(1)]
director is a shareholder, director, officer, or
trustee of another named company or other Subsidiary
person and is to be regarded as interested in Wholly-owned subsidiary
any transaction which may, after the date of 22.2. (1) If the company is a wholly-owned
the entry or disclosure, be entered into with subsidiary, a director may, when exercising
that company or person, is a sufficient powers or performing duties as a director, act
disclosure of interest in relation to that in a manner which he or she believes is in the
best interests of the company’s holding being carried on in a manner likely to create a
company even though it may not be in the substantial risk of serious loss to the
best interests of the company. company’s creditors; or
Not wholly-owned subsidiary (b) Cause or allow the business of the
(2) If the company is a subsidiary (but not a company to be carried on in a manner likely to
wholly-owned subsidiary), a director may, create a substantial risk of serious loss to the
when exercising powers or performing duties company’s creditors.
as a director, with the prior agreement of the [See section 135]
shareholders (other than its holding
company), act in a manner which he or she Duty in relation to obligations
believes is in the best interests of the 22.8. A director must not agree to the
company’s holding company even though it company incurring an obligation unless the
may not be in the best interests of the director believes at that time on reasonable
company. grounds that the company will be able to
[See section 131(2) and (3)] perform the obligation when it is required to do
so.
Joint venture [See section 136]
22.3. If the company is carrying out a joint
venture between its shareholders, a director Director’s duty of care
may, when exercising powers or performing 22.9. A director, when exercising powers or
duties as a director in connection with the performing duties as a director, must exercise
carrying out of the joint venture, act in a the care, diligence, and skill that a reasonable
manner which he or she believes is in the best director would exercise in the same
interests of a shareholder or shareholders, circumstances, taking into account, but
even though it may not be in the best interests without limitation:
of the company. (a) The nature of the company; and
[See section 131(4)] (b) The nature of the decision; and
(c) The position of the director and the nature
Exercise of powers in relation to of the responsibilities undertaken by him or
employees her.
22.4. Nothing in clause 22.1, clause 22.2, or [See section 137]
clause 22.3 limits the power of a director to
make provision for the benefit of employees of Keep minutes and records
the company in connection with the company 22.10. (1) The board must cause minutes of
ceasing to carry on the whole or part of its all resolutions and proceedings of all meetings
business. of the company and of the board to be duly
[See section 132] entered in books to be from time to time
provided for the purpose and, in particular,
Powers to be exercised for proper purpose must cause to be recorded in such minutes:
22.5. A director must exercise a power for a (a) The names of the directors present at each
proper purpose. meeting of the board; and
[See section 133] (b) All resolutions of the board and of any
meeting of the company; and
Directors to comply with Act and (c) All appointments of officers of the
constitution company; and
22.6. A director must not act, or agree to the (d) All bills, notes, debentures, mortgages,
company acting, in a manner that contravenes and charges authorised to be drawn,
the Act or this constitution. accepted, made, given, or executed and all
[See section 134] instruments which, if entered into by a natural
person, would, by law, be required to be by
Reckless trading deed.
22.7. A director must not: (2) Similar minutes must be made and entered
(a) Agree to the business of the company of all resolutions and proceedings of any
committee. liable under the provisions of the Act which
(3) The minutes of any meeting of the impose liabilities on directors in relation to
company or of the board or of any committee acts and omissions and decisions made while
(if purporting to be signed by the chairman of that person was a director.
such meeting or of the next succeeding [See section 157
meeting) are receivable in all courts and by
any person authorised to take evidence as Notice of change of directors
prima facie evidence of the matters stated in 23.2. The board must ensure that, within 20
such minutes. working days of a change in the directors, or
in their residential address, or of the company
Keep accounts first becoming aware of the change, notice of
22.11. The board must keep books of account the change, in the prescribed form, is received
in the manner and to the extent required by by the Registrar.
sections 194 and 195 of the Act.
24. ADDITIONAL DIRECTORS
Annual return
22.12. (1) The board must ensure that the Vary number of directors
Registrar receives each year, during the 24.1. The company may by special resolution
month allocated to the company for the of shareholders determine the maximum or
purpose, an annual return in the prescribed minimum number of directors at any time.
form.
(2) The annual return must be dated as at a Co-opt directors
day within the month during which the return 24.2. (1) The directors have power at any
is required to be received by the Registrar. time, and from time to time, to appoint any
The information in it must be compiled as at person to be a director, either to fill a casual
that date. vacancy or as an addition to the existing
[See section 214] directors.
Duration of appointment
23. DIRECTORS CEASING TO HOLD (2) Any director so appointed holds office only
OFFICE until the next following annual meeting.

Director ceasing to hold office Appointment of alternate directors

23.1. (1) The office of director of the company 24.3. (1) Any director may appoint any person
is vacated if the person holding that office: other than an existing director (who has been
(a) Resigns in accordance with subclause (2); approved for that purpose by a majority of the
or other directors or alternate or substituted
(b) Is removed from office in accordance with directors) to be an alternate or substituted
the Act or this constitution; or director.
(c) Becomes disqualified from being a director (2) The appointee, while he or she holds office
in accordance with section 151; or as an alternate or substituted director:
(d) Dies; or (a) Is entitled to notice of meetings of the
(e) Otherwise vacates office in accordance directors and to attend and vote at the
with this constitution. meetings as a director in the absence of their
Resignation appointing director; and
(2) A director may resign office by signing a (b) Does not require any shareholding
written notice of resignation and delivering it qualification; and
to the address for service of the company. (c) In the absence of their appointing director,
The notice is effective when it is received at perform all the functions and exercise all the
that address or at a later time specified in the powers, of the director; and
notice. (d) Is not entitled to be remunerated by the
Remains liable company otherwise than out of the
(3) Notwithstanding the vacation of office, a remuneration of the director appointing him or
person who held office as a director remains her.
May be cancelled waived if all directors entitled to receive notice
(3) Any appointment so made may be of the meeting attend the meeting without
cancelled at any time by the appointor and protest as to the irregularity or if all directors
any appointment or cancellation under this entitled to receive notice of the meeting agree
clause must be effected by notice in writing to to the waiver.
be delivered to the company. Any such
appointment will be deemed to be cancelled Methods of holding meetings
on the appointing director ceasing to be a 25.3. A meeting of the board may be held by a
director. quorum of directors:
Proxy (a) being assembled together at the place,
(4) Any director or alternate director may date, and time appointed for the meeting; or
attend and vote by proxy at any meeting of (b) participating by means of audio, audio and
the directors, provided that the proxy is a visual, or electronic communication by which
director or alternate director and has been all directors participating and constituting the
appointed in writing under the hand of the quorum can simultaneously hear each other
appointor. throughout the meeting; or
Particular meetings only except with (c) a combination of (a) and (b) above.
consent
(5) Every such appointment must be for a Quorum
particular meeting or meetings, but with the 25.4. (1) A quorum for a meeting of the board
consent of the board may be general. is the number specified in the schedule in part
1.
25. PROCEEDINGS OF BOARD OF (2) No business may be transacted at a
DIRECTORS meeting of directors if a quorum is not
[See Schedule 3] present.

Chairperson Voting
25.1. (1) The directors may elect 1 of their 25.5. (1) Every director has 1 vote.
number as chairperson of the board. No casting vote
(2) The director elected as chairperson holds (2) The chairperson does not have a casting
that office until he or she dies or resigns, or vote.
the directors elect a chairperson in his or her Majority vote
place. (3) A resolution of the board is passed if it is
(3) If no chairperson is elected or if, at any agreed to by all directors present without
meeting of the board, the chairperson is not dissent or if a majority of the votes cast on it
present within 5 minutes after the time are in favour of it.
appointed for the commencement of the May abstain
meeting, the directors present may choose 1 (4)(a) Clause 5(4) of the Third Schedule does
of their number to be chairperson of the not apply.
meeting. (b) A director present at a meeting of the
board may abstain from voting. An abstaining
Notice of meeting director is not presumed to have agreed to,
25.2. (1) A director or, if requested by a and to have voted in favour of, a resolution of
director to do so, an employee of the the board.
company, may convene a meeting of the
board by giving notice in accordance with this Minutes
clause. 25.6. The board must ensure that minutes are
(2) Not less than 4 working days’ notice of a kept of all proceedings of the board.
meeting of the board must be sent to every
director who is in New Zealand, and the notice Unanimous resolution
must include the date, time, and place of the 25.7. (1) A resolution in writing, signed or
meeting and the matters to be discussed. assented to by all directors then entitled to
(3) An irregularity in the notice of a meeting is receive notice of a board meeting, is as valid
and effective as if it had been passed at a Substitute arbitrator
meeting of the board duly convened and held. (4) If the arbitrator dies, declines to act, or
(2) Any such resolution may consist of several becomes incapable of acting, then the
documents (including facsimile or other similar respective president may appoint another.
means of communication) in like form each Jurisdiction of arbitrator
signed or assented to by 1 or more directors. (4A) The sole arbitrator must decide the
(3) A copy of any such resolution must be dispute:
entered in the minute book of board (a) If the parties expressly authorise the
proceedings. arbitrator (in accordance with Article 28(3) of
the First Schedule of the Arbitration Act 1996)
Other proceedings ex aequo et bono (in accordance with
25.8. Except as provided in this clause 25, the considerations of general justice and
board may regulate its own procedure. fairness); but failing such authorisation;
(b) According to the substantive law of New
Mediation or arbitration Zealand.
Dispute between directors decided by Power of arbitrator
shareholders (5) Upon any such reference the arbitrator has
25.9. (1) If any dispute arises between the power:
directors in connection with any of the (a) To take the opinion of any counsel he or
relationships created by or recorded in this she thinks fit upon any question of law that
constitution, and if a complete or temporary arises and to adopt (at his or her discretion)
deadlock in the management by the board of any opinion taken; and
the affairs of the company is created by that (b) To obtain the assistance of any expert he
dispute, then the matter in dispute must be or she thinks fit and to act (at his or her
immediately referred by the board to the discretion) upon any statement of accounts,
shareholders of the company at a special survey, valuation, or other expert assistance
meeting to be called by the board for the thus obtained.
purpose. Observe arbitrator’s decision
Mediation or arbitration if shareholders (6) Each of the parties must do all things and
cannot agree execute all instruments to give effect to the
(2) If at the special meeting there is a award by the arbitrator.
deadlock between the shareholders, then the
dispute which is causing the deadlock must 26. MANAGING DIRECTOR
be referred to:
(a) A sole mediator, if the shareholders agree Appointment
upon one; 26.1. (1) The board may, from time to time,
(b) If the shareholders fail to agree upon a appoint 1 or more of their body to the office of
mediator, or if the mediation process fails to managing director for such period and on
resolve the dispute within 20 working days of such terms as the board thinks fit, and,
the dispute being referred to mediation, then subject to the terms of any agreement entered
to a sole arbitrator, if the shareholders agree into in any particular case, may revoke any
upon one. such appointment.
Failure to agree on arbitrator Termination
(3) If they do not agree upon an arbitrator, (2) The appointment of a director so appointed
then the arbitrator will be nominated (on the is automatically determined if he or she
application of any shareholder, at any time): ceases from any cause to be a director.
(a) By (or on behalf of) the President of the
Arbitrators’ and Mediators’ Institute of New Powers
Zealand Inc; or 26.2. Subject to section 130, the board may
(b) If the President fails to make the entrust to and confer upon a managing
nomination within a reasonable time, then by director any of the powers exercisable by the
(or on behalf of) the President of the New board upon such terms and conditions and
Zealand Law Society. with such restrictions as the board may think
fit, and either collaterally with or to the company or a related company for any act or
exclusion of the board’s powers, and may omission in his or her capacity as a director or
from time to time revoke, withdraw, alter, or employee; or
vary all or any of those powers. (b) Costs incurred by that director or
employee in defending or settling any claim or
Remedy in damages only proceeding relating to any such liability;
26.3. (1) The board may agree on behalf of not being criminal liability or liability in respect
the company with anyone who is or is about to of a breach, in the case of a director, of the
become a managing director as to the length duty specified in clauses 22.1 to 22.3 or, in the
and terms of the managing director’s case of an employee, of any fiduciary duty
employment, on the basis that the remedy of owed to the company or related company.
that person for any breach of the agreement Insurance for a director or employee
will be in damages only. (5) The company may, with the prior approval
(2) The managing director does not have a of the board, effect insurance for a director or
right or claim to continue in office as employee of the company or a related
managing director contrary to the will of the company in respect of:
board. (a) Liability (not being criminal liability) for any
act or omission in his or her capacity as a
27. INDEMNITY, INSURANCE, AND director or employee; or
REMUNERATION (b) Costs incurred by that director or
employee in defending or settling any claim or
Indemnity and insurance proceedings relating to any such liability; or
27.1. (1) Except as provided in this clause, the (c) Costs incurred by that director or employee
company must not indemnify, or directly or in defending any criminal proceedings:
indirectly effect insurance for, a director or (i) That have been brought against the director
employee of the company or a related or employee in relation to any act or omission
company in respect of: in his or her capacity as a director or
(a) Liability for any act or omission in his or employee; and
her capacity as a director or employee; or (ii) In which he or she is acquitted.
(b) Costs incurred by that director or Directors’ certificate
employee in defending or settling any claim or (6) The directors who vote in favour of
proceeding relating to any such liability. authorisation of insurance under subclause (5)
(2) An indemnity given in breach of this clause must sign a certificate stating that, in their
is void. opinion, the cost of effecting the insurance is
Indemnify a director or employee for costs fair to the company.
where acquittal or discontinuance Interests register
(3) The company may indemnify a director or (7) The board must ensure that particulars of
employee of the company or a related any indemnity given to, or insurance effected
company for any costs incurred by him or her for, any director or employee of the company
in any proceeding: or related company are forthwith entered in
(a) That relates to liability for any act or the interests register.
omission in his or her capacity as a director or Definitions
employee; and (8) The definitions of “director”, “effect
(b) In which judgment is given in his or her insurance”, “employee”, and “indemnify” are in
favour, or in which he or she is acquitted, or section 162(9).
which is discontinued. [See section 162]
Indemnify a director or employee for
liability other than to company or related Remuneration and other benefits of
company directors
(4) The company may indemnify a director or 27.2. (1) The board, subject to the approval by
employee of the company or a related ordinary resolution of shareholders, may
company in respect of: authorise:
(a) Liability to any person other than the (a) The payment of remuneration or the
provision of other benefits by the company to (iii) If this constitution elsewhere so provides,
a director for services as a director or in any a director or other person or class of persons,
other capacity; and whose signature or signatures must be
(b) The payment by the company to a director witnessed; or
or former director of compensation for loss of (iv) One or more attorneys appointed by the
office; and company in accordance with section 181.
(c) The making of loans by the company to a If writing required
director; and (b) An obligation which, if entered into by a
(d) The giving of guarantees by the company natural person, is, by law, required to be in
for debts incurred by a director; and writing may be entered into on behalf of the
(e) The entering into a contract to do any of company in writing by a person acting under
the things set out in paragraphs (a), (b), (c), the company’s express or implied authority.
and (d); If writing not required
if the board is satisfied that to do so is fair to (c) An obligation which, if entered into by a
the company. natural person, is not, by law, required to be in
Interests register writing may be entered into on behalf of the
(2) The board must ensure that forthwith after company, in writing or orally, by a person
authorising the making of the payment, or the acting under the company’s express or
provision of the benefit, or the making of the implied authority.
loan, or the giving of the guarantee, or the Common seal
entering into of the contract, as the case may (2) The company may, in addition to
be, particulars of the payment, or benefit, or complying with subclause (1), affix its
loan, or guarantee, or contract are entered in common seal, if it has one, to the contract or
the interests register. document containing the enforceable
Directors’ certificate obligation.
(3) Directors who vote in favour of authorising Also applies outside New Zealand
a payment, benefit, loan, guarantee, or (3) Subclause (1) applies to a contract or
contract under subclause (1) must sign a other obligation:
certificate stating that, in their opinion, the (a) Whether or not the obligation was entered
making of the payment, or the provision of the into in New Zealand; and
benefit, or the making of the loan, or the (b) Whether or not the law governing the
giving of the guarantee, or the entering into of contract or obligation is the law of New
the contract is fair to the company, and the Zealand.
grounds for that opinion. [See section 180]
[See section 161]
29. ACCOUNTS
PART 7. ADMINISTRATION
Accounting records to be kept
28. AUTHORITY TO BIND COMPANY 29.1. (1) The board must ensure that there are
kept at all times accounting records that:
Method of contracting (a) Correctly record the transactions of the
28.1. (1) A contract or other enforceable company; and
obligation may be entered into by the (b) Will enable the company to ensure that the
company as follows: financial statements or group financial
Deeds statements of the company comply with
(a) An obligation which, if entered into by a generally accepted accounting practice (if the
natural person, would, by law, be required to company must prepare such statements
be by deed may be entered into on behalf of under the Act or any other enactment); and
the company in writing signed under the name (c) Will enable the financial statements or
of the company by: group financial statements of the company to
(i) Two or more directors of the company; or be readily and properly audited (if those
(ii) If there is only 1 director, by that director, statements are required to be audited).
whose signature must be witnessed; or In English or convertible into English
(2) The accounting records must be kept: is in effect, the company need not send to the
(a) In written form and in English; or shareholder the documents to which the
(b) In a form and manner in which they are waiver relates. However, if a shareholder
easily accessible and convertible into written purports to waive the right to receive both a
form in English. copy of the annual report and the notice
[See section 194] referred to in clause 29.3(1), the purported
waiver is invalid and the board must send the
Annual report shareholder a copy of the annual report or
29.2. Provided that the company is either notice unless the company does not have to
required to, or has opted-in to under clause prepare an annual report.
31A.1, prepare an annual report for its current [See section 212]
accounting period, the board must, within 5
months after the balance date of the 30. INSPECTION OF COMPANY RECORDS
company, prepare an annual report on the
affairs of the company during the accounting Public inspection of company records
period ending on that date. 30.1. The company must keep the following
[See section 208] records available for inspection in the manner
prescribed in clause 30.3 by a person who
Annual report to shareholders serves on the company written notice of
29.3. (1) Subject to clause 29.4 and provided intention to inspect:
that the company prepares an annual report (a) The certificate of incorporation or
under clause 29.2, the board must cause a registration;
copy of the annual report or a notice (b) This constitution;
containing the statements specified in section (c) The share register;
209(3) to be sent to every shareholder: (d) The company’s ultimate holding company
(a) Not less than 20 working days before the information;
date fixed for holding the annual meeting of (e) The full names and residential addresses
shareholders; or of the directors;
(b) If, under clause 16.1(5) or clause 16.3(4), (f) The registered office and address for
it is not necessary to hold an annual meeting, service of the company.
within 20 working days after the date on which [See section 215]
the annual report is prepared.
(2) If the board sends a notice in accordance Inspection of company records by
with subclause (1) and the shareholder, within shareholders
15 working days of receiving that notice, 30.2. The company must keep the following
makes a request to the company to receive a records available for inspection in the manner
copy of the annual report, the board must, as prescribed by clause 30.3 by a shareholder of
soon as practicable, send to the shareholder, the company, or by a person authorised in
free of charge, a copy of that annual report. writing by a shareholder for the purpose, who
(3) If a shareholder makes a request under serves on the company written notice of
subsection (2), the request must be treated as intention to inspect:
a request by the shareholder to receive a (a) Minutes of all meetings and resolutions of
copy of the annual report each year until that shareholders;
request is revoked by notice to the company. (b) Copies of all written communications to all
[See section 209] shareholders or to all holders of a class of
shares during the preceding 10 years,
Shareholders may elect not to receive including annual reports, financial statements,
documents summary financial statements (if any) and
29.4. A shareholder may elect, by written group financial statements;
notice to the company, to waive the right to (c) Certificates given by directors under the
receive all or any documents from the Act;
company. The shareholder may revoke the (d) The interests register.
waiver in the same manner. While the waiver [See section 216]
 available for inspection or limit the inspection
Manner of inspection of them in any manner it thinks fit.
30.3. (1) Documents which may be inspected [See section 191]
under clause 30.1 or clause 30.2 must be
available for inspection at the place at which Company records
the company’s records are kept between 9.00 30.7. (1) Subject to subclause (3), the
am and 5.00 pm on each working day during company must keep the following documents
the inspection period. at its registered office:
Inspection period (a) This constitution;
(2) “Inspection period” means the period (b) Minutes of all meetings and resolutions of
commencing on the third working day after the shareholders within the last 7 years;
day on which notice of intention to inspect is (c) An interests register;
served on the company by the person or (d) Minutes of all meetings and resolutions of
shareholder concerned and ending with the directors and directors’ committees within the
eighth working day after the day of service. last 7 years;
[See section 217] (e) Certificates given by directors under the
Act within the last 7 years;
Copies of documents (f) The full names and addresses of the
30.4. A person may require a copy of, or current directors;
extract from, a document which is available (g) Copies of all written communications to all
for inspection by him or her under clause 30.1 shareholders or all holders of the same class
or clause 30.2 to be sent to him or her: of shares during the last 7 years, including
(a) Within 5 working days after he or she has annual reports made under clause 29.2;
made a request in writing for the copy or (h) Copies of all financial statements and
extract; and group financial statements required to be
(b) If he or she has paid a reasonable copying completed by the Act or any other enactment
and administration fee prescribed by the for the last 7 completed accounting periods of
company. the company;
[See section 218] (i) The accounting records required by clause
29.1 for the current accounting period and for
Information for shareholders the last 7 completed accounting periods of the
30.5. Subject to the restrictions contained in company;
section 178, a shareholder may at any time (j) The share register.
make a written request for information held by (2) The references in paragraphs (b), (d), (e),
the company. and (g) of subclause (1) to 7 years and the
[See section 178] references in paragraphs (h) and (i) of that
subclause to 7 completed accounting periods
Inspection of records by directors include such lesser periods as the Registrar
30.6. (1) Subject to subclause (2), every may approve by notice in writing to the
director is entitled, on giving reasonable company.
notice, to inspect the records of the company: Notice to Registrar
(a) In written form; and (3) The records referred to in paragraphs (a)
(b) Without charge; and to (i) of subclause (1) may be kept at a place
(c) At a reasonable time specified by the in New Zealand, notice of which is given to the
director. Registrar in accordance with subclause (4).
(2) The Court may, on the application by the (4) If any records are not kept at the
company, if it is satisfied that: registered office of the company, or the place
(a) It would not be in the company’s interests at which they are kept is changed, the
for a director to inspect the records; or company must ensure that within 10 working
(b) The proposed inspection is for a purpose days of their first being kept elsewhere or
that is not properly connected with the moved, as the case may be, notice is given to
director’s duties; the Registrar for registration of the places
direct that the records need not be made where the records are kept.
[See section 189] (b) 387A;
(c) 388;
31. AUDIT (d) 388A;
(e) 391.
When no auditors required
31.1. Unless the company opts-in to doing so Joint holders
under clause 31A.1, where the company is 32.2. A notice may be given by the company
not required under the Act or any other to the joint holders of a share by giving the
enactment to audit its (group) financial notice to the joint holder first named in the
statements, an auditor need not be appointed register of shareholders in respect of the
for that period. share.
[See sections 206 and 207].
Mentally disordered or protected person,
When auditors required deceased or bankrupt estate
31.2 If, under the Act or any other enactment, 32.3. A notice may be given by the company
the company is required to have its financial to the persons who are entitled to a share in
statements or group financial statements for consequence of the mental disorder,
that accounting period audited, then the protection order, death, or bankruptcy of a
company must at the annual meeting held in shareholder by sending the notice through the
that accounting period appoint a qualified post in a prepaid letter addressed to them by
auditor to: name, or by the title of the manager,
(a) hold office from the conclusion of the protection attorney, representatives of the
meeting until the conclusion of the next deceased, or assignee of the bankrupt, or by
annual meeting; and any like description:
(b) audit those financial statements or group (a) At the address, if any, supplied for the
financial statements. purpose by the persons claiming to be
[See section 207P] entitled; or
(b) Until such an address has been supplied,
31A. Opt-in regime for financial reporting by giving the notice in any manner in which
the notice might have been given if the mental
Opting-in disorder, death, or bankruptcy had not
31A.1. Where the company is not otherwise occurred.
required under the Act to comply with sections
201, 202, 207 and 208 of the Act, its Notice of meeting
shareholder(s) holding not less than 5 percent 32.4. (1) Notice of every meeting must be
of the company’s voting shares may, by the given to:
procedure set out in section 207K(2) of the (a) Every shareholder except those
Act, opt-in for that period to: shareholders who (having no registered
(i) Preparing financial statements or group address within New Zealand) have not
financial statements, as applicable; supplied to the company an address within
(ii) Requiring the audit of the financial New Zealand for the giving of notices to them;
statements or group financial statements and
referred to in (i) above; and/or (b) Every person upon whom the ownership of
(iii) Preparing an annual report. a share devolves by reason of his or her being
[See section 207K] a legal personal representative or an assignee
in bankruptcy of a shareholder where the
32. NOTICES shareholder but for his or her death or
bankruptcy would be entitled to receive notice
Service of the meeting; and
32.1. Documents may be served in (c) The auditor (if any) for the time being of
accordance with the following sections of the the company.
Act: (2) No other person is entitled to receive
(a) 387; notices of meetings.
 (2) The address for service may be the
Service on director or shareholder company’s registered office or another place,
32.5. The company may serve a notice upon but it must not be at a postal centre or
any director or shareholder either: document exchange.
(a) Personally; or (3) A company’s address for service at any
(b) By posting it by Fast Post in a prepaid particular time is the address that is described
envelope or package addressed to that as its address for service in the New Zealand
director or shareholder at that person’s last register at that time.
known address; or (4) The description of the address for service
(c) By delivery to a document exchange; or must state that it is at the registered office of
(d) By facsimile to the facsimile telephone the company, or if it is at another place, must:
number of that director or shareholder; or (a) State the address of that place; and
(e) By any other method permitted under the (b) If the address for service is at the offices of
Act for service of a notice on a director or any firm of accountants, barristers and
shareholder. solicitors, or any other person, state:
[See sections 387 to 391] (i) That the address for service of the
company is at the offices of that firm or
Time of service by facsimile and email person; and
32.6. A notice served by facsimile or email is (ii) Particulars of the location in any building of
deemed to be served on the day after it was those offices; or
sent (c) If the address for service is not at the
offices of any such firm or person but is
Time of service by post located in a building occupied by persons
32.7. A notice which is sent by post or other than the company, state particulars of its
delivered to a document exchange is deemed location in the building.
to be served: [See section 192]
(a) On a person whose last known address is
in New Zealand, at the expiry of 48 hours after Change of address for service
the envelope or package which contained it 33.2. (1) Subject as provided elsewhere in this
was posted or delivered in New Zealand; and constitution, the board may change the
(b) On a person whose last known address is address for service at any time.
outside New Zealand, at the expiry of 7 days (2) Notice in the prescribed form of the
after the envelope or package which change must be given to the Registrar for
contained it was posted by Fast Post in New registration.
Zealand. (3) A change of address for service takes
effect on a date stated in the notice, not being
Proof of service a date that is earlier than 5 working days after
32.8. (1) To prove service by post or delivery the notice is registered.
to a document exchange it is sufficient to [See section 193]
prove that the envelope or package which
contained the notice was properly addressed No address supplied
and posted or delivered with all attached 33.3. If a shareholder has no registered
postal or delivery charges paid. address, and if the shareholder has not
(2) To prove service by facsimile or email, it is supplied to the company an address for the
sufficient to prove that the document was giving of notices to him or her:
properly addressed and sent by facsimile or (a) The shareholder is not entitled to have any
email. notices sent to him or her from the company;
and
33. ADDRESS FOR SERVICE (b) The company’s registered office is deemed
to be the registered address for the
Address for service shareholder for all purposes; and
33.1. (1) The company must have an address (c) All proceedings which are taken without
for service in New Zealand. notice to that shareholder are as valid as if he
or she had due notice. not, or will not be likely to, prejudice the
company.
34. SECRETS OF COMPANY [See section 145]

Shareholders not entitled 35. SECRETARY

34.1. (1) No shareholder is entitled to require
or receive any information concerning the Appointment and removal
company’s business, trading, or customers, or 35.1. (1) A secretary may be appointed by the
any trade secret or secret process of or used board for the term, at the remuneration, and
by the company, beyond such information as upon the conditions that the board thinks fit.
to the accounts and businesses of the (2) Any secretary so appointed may be
company as is by this constitution or by removed by the board.
statute directed to be disclosed to
shareholders. 36. LIQUIDATION
(2) No shareholder is entitled to inspection of
any of the books, papers, correspondence, or Surplus assets
documents of the company, except so far as 36.1. (1) When the company is liquidated the
such inspection is expressly authorised by surplus assets must be distributed to the
statute. shareholders proportionately to their
shareholdings.
Use of company information (2) The holders of shares which have not
34.2. (1) A director who has information in his been paid up in full must receive only a
or her capacity as a director or employee of proportionate share. That share is
the company, being information that would not proportionate to the amount paid to the
otherwise be available to him or her, must not company in satisfaction of the shareholder’s
disclose that information to any person, or use liability to the company in respect of those
or act on the information, except: shares, whether pursuant to the constitution or
(a) For the purposes of the company; or pursuant to the terms of issue.
(b) As required by law; or [See section 313]
(c) In accordance with subclause (2) or
subclause (3); or 37. REMOVAL FROM NEW ZEALAND
(d) In complying with clause 21.3. REGISTER
Disclosure permitted
(2) A director may, unless prohibited by the Request for removal
board, disclose information to: 37.1. Those shareholders entitled to vote and
(a) A person whose interests the director voting on the question by special resolution
represents; or may, in the prescribed form, apply to the
(b) A person in accordance with whose Registrar to remove the company from the
directions or instructions the director may be New Zealand Register on the grounds:
required or is accustomed to act in relation to (a) That the company has ceased to carry on
the director’s powers and duties and, if the business, has discharged in full its liabilities to
director discloses the information, the name of all its known creditors, and has distributed its
the person to whom it is disclosed must be surplus assets in accordance with this
entered in the interests register. constitution and the Act; or
Requirements for disclosure (b) That the company has no surplus assets
(3) A director may disclose, make use of, or after paying its debts in full or in part, and no
act on the information if: creditor has applied to the Court under section
(a) Particulars of the disclosure, use, or the 241 for an order putting the company into
act in question are entered in the interests liquidation.
register; and [See section 318]
(b) The director is first authorised to do so by
the board; and
(c) The disclosure, use, or act in question will