Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698754740686.pdf (New Zealand)
2009/395 Securities (Moratorium) Regulations 2009 Anand Satyanand, Governor-General Order in Council At Wellington this 14th day of December 2009 Present: His Excellency the Governor-General in Council Pursuant to sections 70(1)(b), (ca), and (g) and 70AA of the Secur- ities Act 1978, His Excellency the Governor-General, acting on the advice and with the consent of the Executive Council, and on the rec- ommendation of the Minister of Commerce after consultation with the Securities Commission in accordance with section 70(3) of that Act, makes the following regulations.
Contents Title Commencement Interpretation Prospectuses Matters to be contained in prospectuses relating to moratorium proposals 1 2 3 4 Page 2 2 3 4 1 r 1 Securities (Moratorium) Regulations 2009 2009/395 Investment statements Matters to be contained in investment statements relating to moratorium proposals Investment statement treatment of matter that is not applicable Information, statements, and other matters must be set out under question Requirements for advertisements and restrictions on content of advertisements in Securities Regulations 2009 Additional clauses deemed to be contained in trust deeds Additional clauses about moratorium proposals deemed to be contained in trust deeds Amendment to Securities Regulations 2009 Periodic disclosure Information that must be sent half-yearly Information that must be sent for other quarters Transitional provisions Saving in respect of trust deeds before commencement Transitional provision relating to periodic disclosure Schedule 1 Additional matters required in prospectus for moratorium proposal Schedule 2 Matters required in investment statement for moratorium proposal Schedule 3 Additional clauses deemed to be contained in trust deeds if moratorium proposal is made 5 5 6 6 6 7 7 9 11 11 11 15 25 Regulations Title These regulations are the Securities (Moratorium) Regulations 2009.
Commencement These regulations come into force on 31 January 2010.
2009/395 Securities (Moratorium) Regulations 2009 r 3 3 (1) Interpretation In these regulations, unless the context otherwise requires,— accounting period has the meaning given in section 2(1) of the Companies Act 1993 Act means the Securities Act 1978 FRS-42 means the financial reporting standard known as Financial Reporting Standard No 42 (Prospective Financial Statements) that has been approved under the Financial Re- porting Act 1993 insolvency, in respect of an issuer,— (a) means that the issuer has been placed in, or become subject to, statutory management, voluntary adminis- tration, or liquidation, or that a receiver has been ap- pointed in relation to the issuer or all or more than half of the assets of the issuer; and includes that the issuer is subject to an overseas insol- vency proceeding (being a collective judicial or admin- istrative proceeding, including an interim proceeding, pursuant to a law relating to insolvency in which the assets and affairs of the issuer are subject to control or supervision by a judicial or any other authority that is competent to control or supervise that proceeding, for the purpose of reorganisation or liquidation) (b) moratorium proposal means an offer of any debt security that is, in substance, a variation of the terms or conditions of an existing debt security that extends the time for payment of the principal amount or any other returns, or reduces or cancels the principal amount or any other returns, that are due, or to become due, under that existing debt security NZ IFRS 7 means the financial reporting standard known as the New Zealand Equivalent to International Financial Report- ing Standard 7 (Financial Instruments: Disclosures) that has been approved under the Financial Reporting Act 1993 quarter means each of the 3-month periods that make up the issuer’s accounting period (for example, if the balance date of the issuer is 30 June 2010, the 4 quarters are the periods of 3 consecutive months ending with the last day of
 September, December, March, and June).
3 r 4 (2) Securities (Moratorium) Regulations 2009 2009/395 For the purposes of these regulations, a moratorium is com- pleted when— (a) all security holders have been paid all of the princi- pal amounts and any other returns that were due under the terms and conditions of the debt securities as varied under the moratorium proposal; or the issuer has entered insolvency.
(b) (3) Any term or expression that is defined in the Act or the Se- curities Regulations 2009 and used, but not defined, in these regulations has the same meaning as in the Act or the Secur- ities Regulations 2009.

Regulation 4(6) of the Securities Regulations 2009 applies with necessary modifications.
(4) Prospectuses Matters to be contained in prospectuses relating to moratorium proposals Every registered prospectus relating to a moratorium proposal must contain all of the information, statements, and other mat- ters specified in Schedule 1 that are applicable to the morator- ium proposal to which the prospectus relates.

Subclause (1) applies in addition to the other requirements set out in the Act and the Securities Regulations 1983 or the Se- curities Regulations 2009 (as the case may be).
The prospectus must contain an index showing the page of the prospectus on which each of the matters in the prospectus appears.
The following do not apply to a prospectus relating to a mora- torium proposal to the extent that these requirements would require disclosure of any particulars of any existing terms of the trust deed: (a) (b) regulation 4 of the Securities Regulations 1983; and clause 13 of Schedule 2 of the Securities Regulations 1983; and clause 14 of Schedule 2 of the Securities Regulations 1983; and clause 5 of Schedule 8 of the Securities Regulations 2009.
(c) (d) 4 (1) (2) (3) (4) 4 2009/395 Securities (Moratorium) Regulations 2009 r 6 (5) This regulation applies regardless of the type of registered prospectus (for example, whether it is a full registered prospec- tus or a short form prospectus, or whether it is a prospectus to which the Securities Regulations 1983 or the Securities Regu- lations 2009 apply).
(6) Nothing in this regulation limits the information, statements, or other matters that may be contained in a registered prospec- tus relating to a moratorium proposal.

Investment statements 5 (1) (2) Matters to be contained in investment statements relating to moratorium proposals Every investment statement relating to a moratorium proposal must set out succinctly all of the information, statements, and other matters specified in Schedule 2.
The following do not apply to an investment statement relating to a moratorium proposal: (a) (b) regulation 7A of the Securities Regulations 1983; and regulations 19 to 22 of the Securities Regulations 2009.
(3) Otherwise, the requirements of the Securities Regulations 1983 and the Securities Regulations 2009 relating to invest- ment statements apply to a moratorium proposal with any necessary modifications, and subclause (1) applies in addition to the other requirements set out in the Act or the Securities Regulations 1983 or the Securities Regulations 2009 (as the case may be).
(4) An investment statement relating to a moratorium proposal may state that additional information about a matter specified in Schedule 2 is set out in a registered prospectus.

(5) An investment statement relating to a moratorium proposal must not contain any information, statements, or matters other than those that are required or provided for by this regulation.
Compare: SR 1983/121 r 7A(1), (2), (5); SR 2009/230 r 19 6 Investment statement treatment of matter that is not applicable If a matter specified in Schedule 2 is not applicable to the moratorium proposal to which an investment statement relates, 5 r 7 Securities (Moratorium) Regulations 2009 2009/395 the investment statement must refer to that matter and state that the matter is not applicable.
Compare: SR 1983/121 r 7A(3); SR 2009/230 r 20 7 Information, statements, and other matters must be set out under question (1) All information, statements, and other matters specified under an italicised question set out in Schedule 2 that are required to be contained in an investment statement in respect of a mora- torium proposal must be set out together in the investment statement under that question.
(2) Despite subclause (1), an investment statement relating to a moratorium proposal may, rather than repeating contact de- tails, contain a cross-reference to the statement of those con- tact details elsewhere in the investment statement.
Compare: SR 1983/121 r 7A(4); SR 2009/230 r 21 8 Requirements for advertisements and restrictions on content of advertisements in Securities Regulations 2009 (2) (1) Nothing in regulations 5 to 7 limits Part 2 or 3 of the Securities Regulations 1983 or Part 3 or 4 of the Securities Regulations 2009.
The provisions in respect of certificates required for advertise- ments must be read as if references to the Securities Regula- tions 1983 and the Securities Regulations 2009 included a ref- erence to these regulations.
Compare: SR 1983/121 r 7A(4); SR 2009/230 r 22 Additional clauses deemed to be contained in trust deeds Additional clauses about moratorium proposals deemed to be contained in trust deeds The clauses of Schedule 3 are deemed to be contained in every trust deed required for the purposes of the Act relating to debt securities (whether or not the trust deed was registered before the date of commencement of these regulations).
9 (1) 6 2009/395 Securities (Moratorium) Regulations 2009 r 11 (2) The clauses in Schedule 3 are in addition to the other clauses that are deemed to be contained in a trust deed by the Securities Regulations 2009.

Amendment to Securities Regulations 2009 10 This regulation amends the Securities Regulations 2009.
(1) (2) Regulation 40 is amended by adding the following subclause: “(6) See also the clauses in Schedule 3 of the Securities (Morator- ium) Regulations 2009, which are also deemed to be contained in every trust deed required for the purposes of the Act relating to debt securities (whether or not the trust deed was registered before the date of commencement of those regulations), where those regulations apply.” Periodic disclosure Information that must be sent half-yearly 11 (1) A half-yearly report summarising the following matters must be sent under section 54A of the Act to each holder of secur- ities in respect of which a moratorium proposal has been ac- cepted: (a) (b) (c) (d) the state of affairs with respect to the property of the issuer as at the end of the half-year to which the report relates; and the conduct of the moratorium, including all amounts received and paid, during the half-year to which the re- port relates; and a statement identifying— (i) the most recent audited annual financial state- ments of the borrowing group; and the most recent interim financial statements of the borrowing group, including a statement of whether or not those are audited; and (ii) a statement to the effect that the financial statements referred to in paragraph (c)— (i) are filed on a public register at the Companies Office of the Ministry of Economic Development and are available for public inspection (including at www.companies.govt.nz); and 7 r 11 Securities (Moratorium) Regulations 2009 2009/395 (ii) will be made available on request, and free of charge, by the issuer; and (e) a statement explaining how a request under paragraph (d)(ii) should be made.
The report must include details of— (a) the property disposed of since the date of any previous report and any proposals for the disposal of the property of the issuer; and amounts owing, as at the date of the report, to creditors of the issuer who would have preferential claims if the issuer were in receivership or liquidation; and other amounts likely to be available as at the date of the report for payment to creditors; and a statement as to all transactions (if any) that are mater- ial related party transactions under generally accepted accounting practice and were entered into or were being performed in the half-year to which the report relates; and if prospective financial information about amounts to be received by the borrowing group was contained or re- ferred to in the prospectus or investment statement for the moratorium proposal, a comparison (if practicable, in the same form and for the same period as the pro- spective information) of the actual receipts against the prospective receipts; and a statement of the trading prospects of the borrowing group, together with any material information that may be relevant to those trading prospects; and a statement updating any forecasts in any prospective financial information that has been previously disclosed to security holders; and a statement of the extent to which any outcomes referred to in the prospectus or the investment statement relating to the moratorium proposal have been achieved, with particular reference to any milestones identified in those documents which were stated to enable achievement of those outcomes to be tracked on a quarterly basis; and a statement of any other matters that are material to the ability of the issuer to achieve any outcomes, forecasts, (b) (c) (d) (e) (f) (g) (h) (i) (2) 8 2009/395 Securities (Moratorium) Regulations 2009 r 12 or milestones that have been previously disclosed to se- curity holders.
(3) (4) (5) (6) (7) The statement required by subclause (2)(f) must include a de- scription of all special trade factors and risks that— (a) are not likely to be known or anticipated by the general public; and could materially affect the prospects of the borrowing group.

(b) The half-years in respect of which reports must be sent under subclause (1) are— (a) the first 6 months of each of the issuer’s accounting periods; and the second 6 months of each of the issuer’s accounting periods.
(b) This regulation applies throughout the period that begins with the start of the half-year in which the moratorium proposal is accepted and that ends with the end of the half-year during which the moratorium is completed.

The documents, information, and other matters required by this clause must be sent to each holder of securities in respect of which a moratorium proposal has been accepted within 2 months after the end of each half-year.
The financial information required by subclause (2)(h) must include (in tabular form where possible) comparative infor- mation from the last 3 quarters (or, if financial information has not been sent under this clause to security holders for all of the last 3 quarters, from those quarters in respect of which financial information has been sent).
Compare: 1993 No 122 s 24 Information that must be sent for other quarters 12 (1) A quarterly report containing the following matters must be sent under section 54A of the Act to each holder of securities in respect of which a moratorium proposal has been accepted: a statement summarising any material change in either (a) the state of affairs with respect to the property of the issuer, or the conduct of the moratorium, since the most recent half-yearly report under regulation 11; and 9 r 12 Securities (Moratorium) Regulations 2009 2009/395 (b) (c) a statement identifying— (i) (ii) the most recent audited annual financial state- ments of the borrowing group; and the most recent interim financial statements of the borrowing group, including a statement of whether or not those are audited; and a statement to the effect that the financial statements referred to in paragraph (b)— (i) are filed on a public register at the Companies Office of the Ministry of Economic Development and are available for public inspection (including at www.companies.govt.nz); and (ii) will be made available on request, and free of charge, by the issuer; and (e) (d) a statement explaining how a request under paragraph (c)(ii) should be made; and a statement of the extent to which any outcomes referred to in the prospectus or the investment statement relating to the moratorium proposal have been achieved, with particular reference to any milestones identified in those documents which were stated to enable achievement of those outcomes to be tracked on a quarterly basis; and The financial information required by subclause (1)(e) must include (in tabular form where possible) comparative infor- mation from the last 3 quarters (or, if financial information has not been sent under this clause to security holders for all of the last 3 quarters, from those quarters in respect of which financial information has been sent).
The documents, information, and other matters required by subclause (1) must be sent to each holder of securities in respect of which a moratorium proposal has been accepted within 2 months after the end of each quarter— (a) in the period that begins when the moratorium proposal is accepted and that ends when the moratorium has been completed; and in respect of which a report under regulation 11 is not required.
(b) (2) (3) 10 2009/395 Securities (Moratorium) Regulations 2009 Schedule 1 13 14 (1) (2) (3) (4) Transitional provisions Saving in respect of trust deeds before commencement To avoid doubt, regulation 9 does not invalidate anything done before the commencement of these regulations.

Transitional provision relating to periodic disclosure Regulations 11 and 12 apply in respect of an issuer whether the moratorium proposal was accepted before or after the date of commencement of these regulations.
Regulation 11 first applies to an issuer in respect of the first half-year of the issuer that ends on or after 30 June 2010.

Regulation 12 first applies to an issuer in respect of the first quarter of the issuer that ends on or after 31 March 2010.
If subclause (2) relieves an issuer from sending a half-yearly report under regulation 11 in respect of a half-year that ends before 30 June 2010, the issuer must send quarterly reports under regulation 12 in respect of each quarter until the first half-yearly report is required under subclause (2) of this regu- lation (for example, if the issuer has a balance date of 31 March 2010, then the issuer must send a quarterly report for the quar- ter ending on that date, and then another quarterly report for the quarter ending 30 June 2010, and then a half-yearly report for the half-year ending 30 September 2010).
Schedule 1 Additional matters required in prospectus for moratorium proposal Contents 1 2 3 4 Description of moratorium proposal Directors’ plans Expert opinion Prospective financial information in respect of current and next accounting periods r 4 Page 12 12 12 13 11 Schedule 1 Securities (Moratorium) Regulations 2009 2009/395 Note: These clauses are additional to the matters required by the Securities Regulations 1983 or the Securities Regulations 2009 (as the case may be).
Description of moratorium proposal A brief, balanced description of the moratorium proposal, in- cluding— (a) (b) the effect of the moratorium proposal, if accepted: the mechanism(s) by which it is proposed to be carried out (for example, by a recapitalisation plan or a repay- ment plan and the process to carry out the moratorium proposal): a brief summary of the proposed variations to the terms and conditions of the security, and of any proposed changes to the trust deed, under the moratorium pro- posal, including the date that the moratorium is due to be completed.
(c) Directors’ plans A statement by the directors of the issuer stating— (a) the outcomes required to be achieved by the issuer to enable it to repay the principal amounts and any other returns due and to become due under the security, and the time frame for achieving those outcomes; and (b) milestones that will enable achievement of those out- (c) comes to be tracked on a quarterly basis; and the likelihood (if any) of insolvency before payment of the principal amounts and any other returns due and to become due under the security.
Expert opinion A copy of a report by an independent expert (being a person who is appointed by the trustee, and who is independent of the issuer, and who has expertise and experience to the satisfaction of the trustee) signed by him or her (either in his or her own name or that of his or her firm) stating his or her opinion, after due inquiry by him or her, of the following: 1 2 3 12 2009/395 Securities (Moratorium) Regulations 2009 Schedule 1 (a) (b) (c) (d) (e) (f) (g) the advantages and disadvantages of the moratorium proposal and the alternative options referred to in the in- vestment statement and whether the assumptions under- lying the issuer’s financial information and analysis are realistic; and if there is more than 1 type or class of existing secur- ity issued by the issuer, the fairness between types or classes, taking into account relative priorities between the types or classes in the event of an insolvency; and whether any potential return for shareholders is fair to security holders in the circumstances of the offer; and details of any related party transactions or distributions that may be voidable if a liquidator were to be appointed immediately, including amounts; and the likelihood of success of the directors’ future plans for the issuer; and the effect of any guarantee given in respect of the issuer; and the merits of the moratorium proposal, having regard to the interests of the class of security holders to whom the offer is made.
4 Prospective financial information in respect of current and next accounting periods (1) A prospective statement of financial position, a prospective statement of financial performance, and a prospective state- ment of cash flows for the borrowing group in relation to the 2 following periods: (a) the accounting period ending on the next balance date after the specified date: the accounting period that is subsequent to the period referred to in paragraph (a) (unless the moratorium is due to be completed before the start of that accounting period).
(b) (2) The statements required by subclause (1) must be prepared in accordance with FRS-42 and on the basis that the moratorium proposal is accepted.
13 Schedule 1 Securities (Moratorium) Regulations 2009 2009/395 (3) However, statements are not required under subclause (1) in relation to an accounting period referred to in that subclause if,— (a) in the opinion of the directors of the issuer, after due inquiry by them, prospective financial statements for that period would be likely to deceive or mislead with regard to any particular that is material to the offer of securities (for example, because it is not practicable to formulate reasonable assumptions on which to base the statements); and the prospectus contains a statement to this effect to- gether with a statement of the directors’ reasons for their opinion; and the prospectus contains alternative financial informa- tion for the period until the moratorium is completed, comprising— (i) a maturity analysis of the expected maturity dates of financial liabilities and financial assets pre- pared in accordance with NZ IFRS 7 (including Appendix E of that Standard) on the basis of the values and timing of repayments for the security if the moratorium proposal is accepted; and an analysis of the proposed business plan for the borrowing group (including the assumptions underlying the plan and a sensitivity analysis) that is prepared in accordance with NZ IFRS 7 on the basis that the moratorium proposal is ac- cepted; and (ii) the prospectus contains a statement of the principal as- sumptions made in preparing the alternative financial information referred to in paragraph (c); and the prospectus contains statements— (i) to the effect that the alternative financial infor- mation is inherently uncertain; and that the financial information contained in the prospectus is not full prospective financial infor- mation; and (b) (c) (d) (e) (ii) 14 2009/395 Securities (Moratorium) Regulations 2009 Schedule 2 (iii) to the effect that the alternative financial infor- mation is based on the best and most current in- formation available.
Compare: SR 2009/230, Schedule 1, cl 11 Schedule 2 Matters required in investment statement for moratorium proposal Contents r 5 Page Important information for investors Information at front of investment statement What is the moratorium proposal?

Description of moratorium proposal Who is involved in this moratorium proposal?

Names and addresses How would the moratorium proposal affect my rights?

Changes to rights Why are the directors putting this moratorium proposal to security holders?
Reasons for moratorium proposal What are the other options, and how do they compare with a moratorium?

Comparison of options What are the directors’ plans for the issuer?

Directors’ plans if moratorium proposal is accepted What may ultimately happen to the issuer?

Directors’ future plans after moratorium completed What does the independent expert say about the moratorium proposal?
Findings of independent expert Schedule 2 Securities (Moratorium) Regulations 2009 2009/395 Who else has an interest in approval of this moratorium proposal?

10 Statement of benefits 11 Statement from trustee What does the trustee say?

Who would monitor the issuer while it is in moratorium?

12 Role of trustee and any independent monitor 13 Risks What are my risks?

Whom do I contact with inquiries about my investment?
14 Inquiries about moratorium proposal Is there anyone to whom I can complain if I have problems after the moratorium proposal is accepted?

15 Complaints about moratorium What other information can I obtain about this moratorium proposal?
16 17 18 19 Prospectus and financial statements Periodic information On-request information Power to appoint receiver after moratorium proposal accepted Power to appoint receiver after moratorium proposal accepted 22 22 23 23 24 24 24 25 25 25 Note: These clauses are instead of the clauses required by Schedule 3D of the Securities Regulations 1983 or Schedule 13 of the Secur- ities Regulations 2009 (as the case may be).
Important information for investors Information at front of investment statement 1 (1) A statement in the following form (to be set out at the front of the investment statement): “Important information 16 2009/395 Securities (Moratorium) Regulations 2009 Schedule 2 (The information in this section is required under the Secur- ities Act 1978.)

Moratorium proposals are very significant, and have short-term and long-term consequences.
They alter your rights under the securities that you currently hold, and the timing or likely amount of any repayments you can expect.

Read all documents carefully.

Ask questions.

Seek profes- sional advice from an adviser before committing yourself.

This document, together with the trust deed, prospectus (if any), and other documents available to you relating to the moratorium proposal, will outline your rights in relation to this moratorium proposal.

Know and understand your rights.


Important considerations when deciding on a moratorium When deciding whether to accept the moratorium proposal, consider carefully the answers to the following questions that can be found on the pages noted below: Page What is the moratorium proposal?

Who is involved in this moratorium proposal?

How would the moratorium proposal affect my rights?

Why are the directors putting this moratorium proposal to security holders?
What are the other options, and how do they compare with a moratorium proposal?

What are the directors’ plans for the issuer?

What will ultimately happen to the issuer?

What does the independent expert say about the moratorium proposal?

Who else has an interest in approval of this moratorium proposal?

What does the trustee say?

Who would monitor the issuer while it is in moratorium?
In addition to the information in this document, important in- formation can be found in the current registered prospectus for 17 Schedule 2 Securities (Moratorium) Regulations 2009 2009/395 the investment.

You are entitled to a copy of that prospectus on request.” If the investment statement relates to securities for which a registered prospectus is not required, the paragraph in the statement in subclause (1) referring to a registered prospectus must be omitted.

What is the moratorium proposal?


Description of moratorium proposal A brief, balanced description of the moratorium proposal, in- cluding— (a) (b) the effect of the moratorium proposal, if accepted: the mechanism(s) by which it is proposed to be carried out (eg, by a recapitalisation plan or a repayment plan and the process to carry out the moratorium proposal).

Who is involved in this moratorium proposal?
Names and addresses The following information in respect of the moratorium pro- posal: (a) (b) (c) (d) (e) the name and address of the issuer: the names of the directors of the issuer: the names and addresses of any promoters: the name and address of the trustee: the name and address of the independent expert referred to in clause 9: the name and address of any independent monitor under the moratorium proposal referred to in clause 12(b): the name of any person who would be a substantial se- curity holder of the issuer if the issuer were a public issuer.
(f) (g) How would the moratorium proposal affect my rights?
Changes to rights The following information about the moratorium proposal: (a) key changes that are proposed to the rights of the se- curity holders to whom the offer is made, including a (2) 2 3 4 18 2009/395 Securities (Moratorium) Regulations 2009 Schedule 2 (b) (c) (d) comparison of those rights before and after the accept- ance of the moratorium proposal: a brief summary of the proposed variations to the terms and conditions of the security, and of any proposed changes to the trust deed, under the moratorium pro- posal, including the date that the moratorium is due to be completed: rights of security holders that are being removed or waived (for example, removal of rights under an agree- ment to take legal action or waiver of any rights in re- spect of any breaches of the trust deed): a statement setting out any rights of security holders under the moratorium proposal if any milestones speci- fied in the moratorium proposal are not achieved or any other event of default or review specified in the mora- torium proposal occurs.
Why are the directors putting this moratorium proposal to security holders?
5 Reasons for moratorium proposal The following information about the moratorium proposal: (a) (b) (c) a brief summary of the issues facing the issuer that have led to the moratorium proposal being formulated: details of any breach or potential breach of the existing terms and conditions of the existing security or of the trust deed for the security and how the breach or poten- tial breach and the consequences of it are addressed by the moratorium proposal: a statement of the benefits (if any) to security holders, and of the benefits (if any) to shareholders or promoters, that the directors believe may result from the morator- ium proposal.
What are the other options, and how do they compare with a moratorium?
6 Comparison of options The following information: 19 Schedule 2 Securities (Moratorium) Regulations 2009 2009/395 (a) (b) (c) (d) (e) (f) a brief, balanced description of the alternative options to the moratorium proposal, including receivership, li- quidation, and any other reasonably practicable options: a statement of the advantages and disadvantages to se- curity holders of the moratorium proposal and the alter- native options to the moratorium proposal that are rea- sonably practicable: a statement of the net present value of the principal amounts and any other scheduled returns due or to be- come due to security holders under each of the options, including any principal assumptions made in this ana- lysis: an explanation in the following form: “Net present value shows the value today of money to be received (or paid) in the future.
It allows investors to compare options that involve different payments at different times.
For example, net present value takes into account that $100 in 6 months time is worth less than $100 now because $100 now can be reinvested and will earn interest for the next 6 months.”: possible risks associated with the moratorium proposal and the reasonably practicable alternative options, in- cluding the risk of future default if the moratorium pro- posal is accepted: a statement as to whether it is the opinion of the direct- ors, after due inquiry by them, that the moratorium pro- posal is the best option from the perspective of security holders assessed as a whole (as opposed to the interests of shareholders, promoters, or any other persons).
What are the directors’ plans for the issuer?
Directors’ plans if moratorium proposal is accepted A statement by the directors of the issuer, on the basis that the moratorium proposal is accepted, of— (a) the outcomes required to be achieved by the issuer to enable it to repay the principal amounts and any other returns due and to become due under the security, and the time frame for achieving those outcomes; and 7 20 2009/395 Securities (Moratorium) Regulations 2009 Schedule 2 (b) milestones that will enable achievement of those out- (c) comes to be tracked on a quarterly basis; and the likelihood (if any) of insolvency before payment of the principal amounts and any other returns due and to become due under the security; and (d) whether the directors of the issuer intend that the issuer will offer any securities to the public during the period of the moratorium.
8 What may ultimately happen to the issuer?
Directors’ future plans after moratorium completed A statement about the directors’ future plans for the issuer fol- lowing the payment of all the principal amounts and any other returns due to be paid under the moratorium proposal, includ- ing— (a) whether the directors of the issuer intend that the issuer will continue trading or be wound up; and (b) whether the directors of the issuer intend that the issuer will offer any securities to the public after the morator- ium is completed.
What does the independent expert say about the moratorium proposal?
Findings of independent expert 9 (1) A brief summary of the opinion of an independent expert (be- ing a person who is appointed by the trustee, and who is inde- pendent of the issuer, and who has expertise and experience to the satisfaction of the trustee), including the independent ex- pert’s assessment of— (a) the advantages and disadvantages of the moratorium proposal and the alternative options referred to in the in- vestment statement and whether the assumptions under- lying the issuer’s financial information and analysis are realistic; and if there is more than 1 type or class of existing secur- ity issued by the issuer, the fairness between types or classes, taking into account relative priorities between the types or classes in the event of an insolvency; and (b) 21 Schedule 2 Securities (Moratorium) Regulations 2009 2009/395 (c) whether any potential return for shareholders is fair to security holders in the circumstances of the offer; and (e) (d) whether there are any related party transactions or dis- tributions that may be voidable if a liquidator were to be appointed immediately; and the likelihood of success of the directors’ future plans for the issuer; and the effect of any guarantee given in respect of the issuer; and the merits of the moratorium proposal having regard to the interests of the class of security holders to whom the offer is made.
(g) (f) (2) The summary in subclause (1) must be one that has been pre- pared by the independent expert.

Who else has an interest in approval of this moratorium proposal?
Statement of benefits A statement of any direct or indirect benefits that any directors, promoters, substantial shareholders, the trustee, and any asso- ciated persons of any of those persons may obtain from the moratorium proposal, including any potential remuneration, incentives, dividends, or increase in capital arising from any revaluation of liabilities, or payments to shareholders, and a quantification of those benefits (to the extent that is reason- ably practicable).

What does the trustee say?
Statement from trustee A statement from the trustee— (a) drawing attention to the key issues of the moratorium proposal, including the effect of the moratorium pro- posal on enforcement and monitoring by the trustee; and identifying any conflicts of interest the trustee may have; and as to why the trustee considers the moratorium proposal has sufficient merit for the trustee to allow it to be put to security holders, rather than taking enforcement action (b) (c) 10 11 22 2009/395 Securities (Moratorium) Regulations 2009 Schedule 2 under the trust deed or seeking any alternative direc- tions from security holders.
Who would monitor the issuer while it is in moratorium?
12 Role of trustee and any independent monitor A brief statement— (a) (b) describing the ongoing role of the trustee; and describing the role of any independent monitor (being a person who is independent of the issuer and who is to be appointed to monitor the issuer’s payment of the principal amounts and any other returns due, or to be- come due, under the moratorium proposal and to report any problems that arise to the trustee); and stating if an independent monitor has not been ap- pointed, why none has been appointed; and stating whether the independent monitor is independent of the trustee.
(c) (d) What are my risks?

Risks 13 (1) A brief description of the principal risks of— (a) (b) (c) the money paid by a security holder not being recovered in full by the subscriber: a security holder not receiving the principal amounts and any other returns due, or to become due, under the terms and conditions of the security as varied by the moratorium proposal: a security holder being required to pay more money in respect of a security.
(2) If it is reasonably foreseeable that, on termination of any se- curity at any time, a security holder will have received, in total, less than the amount paid to the issuer or an associated person for the security, a statement to this effect and a brief descrip- tion of the circumstances that may produce this result.

23 Schedule 2 Securities (Moratorium) Regulations 2009 2009/395 14 15 (1) (2) Whom do I contact with inquiries about my investment?
Inquiries about moratorium proposal The names or descriptions of officers, employees, or agents of the issuer to whom inquiries about the moratorium proposal can be made, and the contact details of those people (which must include an address and a business telephone number).

Is there anyone to whom I can complain if I have problems after the moratorium proposal is accepted?
Complaints about moratorium The names or descriptions of officers, employees, or agents of the issuer to whom complaints about the moratorium can be made, and the contact details of those people (which must include an address and a business telephone number).

If complaints about the moratorium can be made to a trustee or an industry body, a statement to this effect and the contact details of those people (which must include an address and a business telephone number).
(3) A statement as to whether complaints about the moratorium can be made to an ombudsman and, if so, the contact details of the ombudsman (which must include an address and a business telephone number).

What other information can I obtain about this moratorium proposal?
Prospectus and financial statements 16 (1) A statement— (a) (b) (c) to the effect that other information about the morator- ium proposal or the issuer, or both, is contained or re- ferred to in a prospectus and in financial statements of, or relating to, the issuer; and describing where a copy of the prospectus and of the most recent financial statements of, or relating to, the issuer can be obtained, free of charge; and to the effect that the prospectus, and financial state- ments and other documents of, or relating to, the issuer, 24 2009/395 Securities (Moratorium) Regulations 2009 Schedule 3 (2) 17 18 are filed on a public register at the Companies Office of the Ministry of Economic Development and avail- able for public inspection (including at www.compan- ies.govt.nz).
For the purposes of subclause (1) and the heading to this clause, if no prospectus is required for the securities, refer- ences to the prospectus must be disregarded.

Periodic information A statement of the periodic information that will be provided to security holders under the moratorium proposal.
On-request information A statement— (a) describing the type of information relating to the issuer or the moratorium proposal that is required to be, or otherwise will be, available on request from the issuer; and explaining how the request should be made; and as to whether any charge may be made for the informa- tion and the amount of the charge.
(b) (c) Power to appoint receiver after moratorium proposal accepted 19 Power to appoint receiver after moratorium proposal accepted A statement of the effect of the clause set out in clause 15 of Schedule 3.

Schedule 3 Additional clauses deemed to be contained in trust deeds if moratorium proposal is made r 9 Note: These clauses are additional to clauses 1 to 11 in Schedule 15 of the Securities Regulations 2009.
25 (b) (b) Schedule 3 Securities (Moratorium) Regulations 2009 2009/395 Clauses relating to moratorium proposals that are deemed to be contained in all trust deeds for debt securities 12 Restriction on amendment of deed as result of moratorium proposals (1) No amendment to the deed may be made as a result of a mora- torium proposal unless,— (a) if the security has been offered in, or accompanied by, a registered prospectus, that prospectus complies with the Act and the Securities (Moratorium) Regulations 2009; and if the security has been offered in, or accompanied by, an investment statement, that investment statement complies with the Act and the Securities (Moratorium) Regulations 2009.
(2) However, there is no breach of subclause (1) in the case of an amendment to the deed as a result of a moratorium proposal that is made before the date of commencement of these regu- lations if the trustee is satisfied that— (a) information has been given to each holder of securities to which the deed relates that is substantially similar to the information required to be contained in a prospectus and an investment statement by the Securities (Morator- ium) Regulations 2009; and the time each holder of securities to which the deed re- lates was given to consider the moratorium proposal and the information referred to in paragraph (a) was no less than the time required by clauses 13 and 14.
(3) If no prospectus is required for the securities, the references to the prospectus in subclauses (1) and (2) must be disregarded.
13 Moratorium proposal meetings (1) The issuer must, at the request in writing of the trustee or of persons holding not less than one-tenth in nominal value of the class of issued debt securities to which the deed and the mora- torium proposal relate, summon a meeting of the holders of those securities for the purpose of considering any moratorium proposal and giving to the trustee their opinions or directions in relation to the exercise of his or her powers.
26 2009/395 Securities (Moratorium) Regulations 2009 Schedule 3 (2) (3) (4) Every meeting summoned under subclause (1), or otherwise convened by the issuer for the purpose of considering any moratorium proposal, must be summoned or convened by sending a notice by post, specifying the time and place of the meeting, to every holder of the securities to which the mora- torium proposal relates at the holder’s last known address not later than 21 days before the date of the proposed meeting.
The notice of a meeting referred to in subclause (2) must be accompanied by— (a) the investment statement for the moratorium proposal; and a statement that, if votes can be cast by proxy, all proxies received before the meeting will be permitted, and of the address or addresses to which any proxies must be sent.
The chairperson of a meeting referred to in subclause (2) must be a person nominated by the trustee or any other person that may be appointed in that behalf by an ordinary majority of the holders of the securities to which the moratorium proposal relates who are present at the meeting.
(b) 14 Written resolutions in lieu of moratorium proposal (1) (2) (3) meetings This clause applies if an issuer proposes that a moratorium proposal be accepted by a written resolution of the holders of securities rather than by a resolution at a meeting of the holders of the securities.
Every proposal for a written resolution to accept the morator- ium proposal must be sent by post to every holder of the secur- ities to which the moratorium proposal relates at the holder’s last known address not later than 21 days before the last date before which acceptances must be sent by security holders.
The proposal for a written resolution must be accompanied by— (a) the investment statement for the moratorium proposal; and if votes can be cast by proxy, a statement of the date by which any proxies must be received and of the address or addresses to which any proxies must be sent.
(b) 27 Schedule 3 Securities (Moratorium) Regulations 2009 2009/395 15 (1) (2) (3) (b) Power to appoint receiver after moratorium proposal accepted This clause applies if— (a) a moratorium proposal has been accepted (whether be- fore or after these regulations come into force); and the trustee had a power to appoint a receiver to enforce the security under the trust deed before the moratorium proposal was accepted (whether that power arose under the trust deed or otherwise, and whether the trustee had the power only if directed by resolution of security hold- ers or otherwise).
The issuer must, at the request in writing of the trustee or of persons holding not less than one-tenth in nominal value of the issued debt securities to which the deed and the moratorium proposal relate, summon a meeting of the holders of those se- curities for the purpose of voting on a resolution that the trustee be directed to appoint a receiver to enforce the security under the trust deed.
The trustee must appoint a receiver in respect of all or any of the property that is subject to a security under the trust deed if a resolution is passed at a meeting of security holders under subclause (1) that directs the trustee to appoint a receiver un- less the trustee is satisfied— (a) that the principal amounts or any other returns due, or to become due, under the moratorium proposal have been paid as provided in that proposal: that it is likely that the principal amounts and any other returns due, or to become due, under the moratorium proposal will be paid as provided in that proposal, hav- ing regard to the extent to which the issuer has achieved the forecasts and milestones disclosed to security hold- ers as part of the moratorium proposal and any other circumstances since the moratorium proposal was ac- cepted.
(b) (4) A resolution of security holders under subclause (3)(a) may be passed by the lower of the following: (a) if the trustee had a power to appoint a receiver to enforce the security under the trust deed before the moratorium proposal was accepted only if directed by resolution of 28 2009/395 Securities (Moratorium) Regulations 2009 Schedule 3 security holders, the same majority of security holders that would have been required to pass such a resolution before the moratorium; or either— (i) (b) (ii) the same majority of security holders that was re- quired to vote in favour of the moratorium pro- posal in order for it to be accepted (for example, if a moratorium proposal could be accepted only if approved by a majority of 75% or higher by value, then the same majority applies under this paragraph); or if no resolution of the holders of the securities to which the moratorium proposal relates was re- quired in order for it to be accepted, persons hold- ing not less than 50% in nominal value of the issued debt securities to which the deed and the moratorium proposal relate that attend the meet- ing in person, or by proxy vote, or by represen- tative, or in any other manner permitted by the trust deed.
(5) 16 This clause does not limit any obligation of the issuer, or any power to appoint a receiver, that exists otherwise than under this clause.

Duty to provide financial statements to Registrar The issuer must provide the Registrar with copies of the an- nual financial statements and half-yearly financial statements of the borrowing group within 20 working days of the date on which the issuer is required to provide them to the trustee under clause 7 of Schedule 15 of the Securities Regulations 2009.
Rebecca Kitteridge, Clerk of the Executive Council.

29 Explanatory note Securities (Moratorium) Regulations 2009 2009/395 Explanatory note This note is not part of the regulations, but is intended to indicate their general effect.

These regulations come into force on 31 January 2010.
These regulations relate to moratorium proposals that vary the terms or conditions of an existing debt security by extending the time for payment of the principal amount or any other returns due, or to be- come due, under that security, or of reducing or cancelling those amounts or returns.

These regulations do not apply in certain other situations, for example, a proposal that the investors swap debt se- curities for equity securities.
The principal effects of the regulations are to— • that must be included in a prescribe additional material prospectus for a moratorium proposal: prescribe the contents of investment statements for a mora- torium proposal.

Currently, the Securities Act (Renewals and Variations) Exemption Notice 2002 provides exemptions, in the case of variations of securities that extend the time for re- payment, from section 37A(1)(a) of the Securities Act 1978, which is the investment statement requirement.
As a compan- ion measure to these regulations, the Securities Commission is removing that exemption in so far as it relates to moratorium proposals: imply certain terms into trust deeds if a moratorium proposal is made in respect of any debt securities.

These confer, among other things, rights as to hold meetings and to appoint a re- ceiver: require periodic disclosure of certain information to security holders of issuers that are in moratorium.
• • • The new terms that are implied into trust deeds, and the new peri- odic disclosure requirements, apply to all issuers for which a morator- ium proposal has been accepted.

This includes issuers that went into moratorium before the regulations are made and issuers that make a moratorium proposal before 31 January 2010.

Transitional provi- sions cover the interface to the new rules.
30 2009/395 Securities (Moratorium) Regulations 2009 Issued under the authority of the Acts and Regulations Publication Act 1989.

Date of notification in Gazette: 17 December 2009.

These regulations are administered by the Securities Commission.

12 Wellington, New Zealand: Published under the authority of the New Zealand Government—2009 31