<PAGE>

                                                                     EXHIBIT 1.1

                                  CONSTITUTION
                                       of

                       FLETCHER CHALLENGE FORESTS LIMITED

                  This document is the Constitution of Fletcher
               Challenge Forests Limited as adopted by the Company
              by Special Resolution passed at the Annual Meeting of
               Shareholders held on the 14th day of November 2001
           and as amended by the Company by Special Resolution passed
  at the Annual Meeting of Shareholders held on the 13th day of November 2002.
<PAGE>
<TABLE>
<CAPTION>
CONTENTS
<S>                                                                                                  <C>
1.  GENERAL.................................................................................           1

2.  RIGHTS ATTACHING TO SHARES..............................................................           2

3.  DIVIDENDS AND DISTRIBUTIONS.............................................................           7

4.  SHAREHOLDERS' MEETINGS..................................................................           9

5.  DIRECTORS...............................................................................          13

6.  TRANSACTIONS............................................................................          17

SCHEDULE 1:  ISSUES OF NEW EQUITY SECURITIES (CLAUSE 2.6)...................................          20

SCHEDULE 2:  BUYBACKS OF EQUITY SECURITIES (CLAUSE 2.13)....................................         25

SCHEDULE 3:  PERMITTED FINANCIAL ASSISTANCE (CLAUSE 2.14)...................................         28

SCHEDULE 4:  CALLS, LIENS AND FORFEITURES (CLAUSE 2.15).....................................         29

ANNEXURE:  DEFINITIONS AND INTERPRETATION (CLAUSE 1.1)......................................         32
</TABLE>

                                                                               i
<PAGE>
1.         GENERAL

1.1        DEFINITIONS AND INTERPRETATION: In this Constitution, unless the
           context otherwise requires, terms are defined and interpreted in
           accordance with the definitions and the rules of interpretation set
           out in the Annexure.

1.2        COMPANIES ACT 1993: The Company, the Board, each Director and each
           Shareholder have the rights, powers, duties and obligations set out
           in the Act, except to the extent that they are negated or modified by
           this Constitution.

1.3        COMPLIANCE WITH LISTING RULES: Subject to:

           (a)        the terms of any Ruling from time to time given by the
                      Exchange; and

           (b)        the requirements of the Act and any other applicable
                      legislative or regulatory requirement,

           the Company will, for so long as it is listed on the Exchange, comply
           with the Listing Rules.

1.4        LISTING RULES PREVAIL: Nothing in this Constitution will prohibit or
           restrict any action which is or may be permitted by the Listing Rules
           or the Exchange to be taken by the Company, the Board, each Director,
           the Shareholders or the holders of any other Securities.

1.5        EXCHANGE RULINGS: If the Exchange has granted a Ruling in relation to
           the Company authorising any act or omission which, in the absence of
           the Ruling, would be in contravention of the Listing Rules or this
           Constitution, that act or omission will be deemed to be authorised by
           the Listing Rules and this Constitution.

1.6        EFFECT OF FAILURE TO COMPLY: Failure to comply with:

           (a)        the Listing Rules; or

           (b)        the provisions of clauses 4.9 or 6,

           will not affect the validity or enforceability of any transaction,
           contract, action or other matter whatsoever (including the
           proceedings of, or voting at, any meeting) done or entered into by,
           or affecting, the Company, except that a party to a transaction or
           contract who knew of the failure to comply with the Listing Rules or
           the provisions of this Constitution listed in (b) above will not be
           entitled to enforce that transaction or contract. This provision does
           not affect the rights of any holder of Securities against the Company
           or the Directors arising from failure to comply with the Listing
           Rules or the provisions of this Constitution listed in (b) above.

1.7        COMPLIANCE WITH ASX LISTING RULES

           (a)        Notwithstanding anything contained in this Constitution,
                      if the ASX Listing Rules prohibit an act being done, the
                      act shall not be done.

           (b)        Nothing contained in this Constitution prevents an act
                      being done that the ASX Listing Rules require to be done.

           (c)        If the ASX Listing Rules require an act to be done or not
                      to be done, authority is given for that act to be done or
                      not to be done (as the case may be).

                                                                               1
<PAGE>
           (d)        If the ASX Listing Rules require this Constitution to
                      contain a provision and it does not contain such a
                      provision, this Constitution is deemed to contain that
                      provision.

           (e)        If the ASX Listing Rules require this Constitution not to
                      contain a provision and it contains such a provision, this
                      Constitution is deemed not to contain that provision.

           (f)        If any provision of this Constitution is or becomes
                      inconsistent with the ASX Listing Rules, this Constitution
                      is deemed not to contain that provision to the extent of
                      the inconsistency.

2.         RIGHTS ATTACHING TO SHARES

2.1        RIGHTS OF EXISTING ORDINARY SHARES: Each Ordinary Share in the
           Company existing at the date of adoption of this Constitution confers
           on the holders, in addition to the rights set out elsewhere in this
           Constitution and in the Act (except where such rights are negated,
           altered or added to by this Constitution), the following rights:

           (a)        voting rights as set out in clause 4.8;

           (b)        subject to the rights of Shareholders or holders of any
                      other Equity Securities which confer special rights as to
                      dividends, the right to an equal share in dividends
                      authorised by the Board; and

           (c)        subject to clause 2.3 and the rights of Shareholders or
                      holders of any other Equity Securities which confer
                      special rights as to surplus assets, the right to an equal
                      share in the distribution of surplus assets of the Company
                      in the event of liquidation.

2.2        RIGHTS OF EXISTING PREFERENCE SHARES: Subject to clause 2.3, each
           Preference Share existing at the date of adoption of this
           Constitution confers on the holders, in addition to the rights set
           out elsewhere in this Constitution and in the Act (except where such
           rights are negated, altered or added by this Constitution) the same
           rights, and ranks equally with, the Ordinary Shares and holders of
           Preference Shares will vote with the holders of Ordinary Shares on
           all matters except on a vote relating to a liquidation of the
           Company, in which case a separate vote of the holders of Preference
           Shares will be required.

2.3        RIGHTS OF SHARES IN THE EVENT OF LIQUIDATION: In addition to the
           rights set out in clause 2.1 and, in the event of liquidation of the
           Company, clause 2.2:

           (a)        the Preference Shares rank ahead (to the amount of NZ$1.25
                      per Preference Share) of the Ordinary Shares;

           (b)        the Ordinary Shares will be entitled to the next NZ$1.25
                      per Ordinary Share; and

           (c)        thereafter, holders of Preference Shares and Ordinary
                      Shares will share equally in any remaining surplus.

2.4        RIGHTS OF PREFERENCE TO LAPSE: On 15 December 2005 (being the fifth
           anniversary of the date of the first allotment of Preference Shares
           as a class) the preference rights of the Preference Shares on
           liquidation, as set out in clause 2.3(a), will lapse and the
           Preference Shares will then have identical rights and rank equally
           with the Ordinary Shares in all respects and no separate vote shall
           thereafter be required under clauses 2.2 or 4.8(b).

                                                                               2
<PAGE>
2.5        TYPES OF NEW EQUITY SECURITIES: Subject to the rights attached to any
           Equity Securities, further Equity Securities (including Equity
           Securities of different Classes) may be issued which have deferred,
           preferred or other special rights or restrictions, whether as to
           voting rights or distributions or otherwise.

2.6        ISSUES OF NEW EQUITY SECURITIES: Subject to the provisions of
           schedule 1 and the rights attached to any Equity Securities, the
           Board may issue Equity Securities at any time, to any person and on
           any terms it thinks fit. Sections 45(1) and 45(2) of the Act do not
           apply to the issue of Equity Securities.

2.7        MODIFICATION OF RIGHTS OF HOLDERS OF SECURITIES: The Company will
           comply with sections 116 and 117 of the Act in respect of Shares and
           will also comply with those sections in respect of other Equity
           Securities on the basis that those sections will be deemed to be
           modified so that:

           (a)        references in those sections to "shares" will (subject to
                      clause 2.9) be deemed to be references to all Equity
                      Securities and references to "holders of shares" and
                      "shareholders" are deemed to be modified accordingly; and

           (b)        in respect of Equity Securities which are not Shares:

                      (i)        references to a "special resolution" will be
                                 deemed to be references to a resolution
                                 approved by a majority of at least 75% of votes
                                 of the holders of those Equity Securities
                                 entitled to vote and voting; and

                      (ii)       references to the "constitution" will be deemed
                                 to be references to the document which governs
                                 the rights of those Equity Securities.

2.8        ISSUE OF PRIOR OR EQUALLY RANKING SHARES OR EQUITY SECURITIES: The
           issue by the Company of any further Shares or other Equity Securities
           which rank equally with, or in priority to, any existing Shares or
           other Equity Securities, whether as to voting rights or
           distributions, will:

           (a)        be permitted (subject to the provisions of schedule 1 and
                      the rights attached to any Equity Securities);

           (b)        not be deemed to be action affecting the rights attached
                      to those existing Shares or other Equity Securities; and

           (c)        not be subject to the provisions of clause 2.7.

2.9        FURTHER EXCEPTIONS TO CLAUSE 2.7: Clause 2.7 will not require the
           Company to comply with sections 116 and 117 of the Act in respect of
           actions that affect the rights attached to:

           (a)        Equity Securities which are not Quoted; or

           (b)        Equity Securities which are not Shares if those Equity
                      Securities were issued on terms which expressly permitted
                      the action in question to be taken without the prior
                      approval of holders of those Equity Securities, and those
                      terms were clearly disclosed in the offering document (if
                      any) pursuant to which those Equity Securities were
                      offered.

2.10       SECTION 118 OF THE ACT: Clause 2.7 will not have the effect of
           deeming section 118 of the Act to apply to any Securities of the
           Company other than Shares.

                                                                               3
<PAGE>
2.11       ACTIONS NOT INVALID: The taking of any action by the Company
           affecting the rights attached to any Quoted Equity Securities other
           than Shares shall not be invalid by reason only that the action was
           not approved in accordance with the provisions of clause 2.7.

2.12       CONSOLIDATION AND SUBDIVISION OF SHARES: Subject to any applicable
           provisions in schedule 1, the Board may consolidate and divide, or
           subdivide, all or any Shares (whether of one or more Classes).

2.13       BUYBACKS OF EQUITY SECURITIES: The Company may:

           (a)        purchase or otherwise acquire Equity Securities issued by
                      it from one or more persons; or

           (b)        hold any Equity Securities so purchased or acquired; or

           (c)        redeem any redeemable Shares or other Equity Securities
                      held by one or more persons,

           in accordance with schedule 2.

2.14       PERMITTED FINANCIAL ASSISTANCE: The Company may give financial
           assistance for the purpose of, or in connection with, the acquisition
           of Equity Securities issued or to be issued by the Company if the
           giving of that assistance is in accordance with the provisions of the
           Act and:

           (a)        complies with clause 1 of schedule 3; or

           (b)        is approved by Shareholders in accordance with clause 2 of
                      schedule 3.

2.15       UNTRACED HOLDERS OF SECURITIES:

           (a)        ENTITLEMENT TO SELL: The Board will be entitled to
                      transfer to a trust (the "TRUST") set up for that purpose,
                      the Equity Securities of any person where three or more
                      dividends paid in respect of the Equity Securities in
                      question have remained unclaimed for at least one year
                      after having been authorised and 14 days' prior notice of
                      the intention to transfer the Equity Securities to the
                      Trust has been given.

           (b)        FURTHER SECURITIES: If any further Equity Securities have
                      been issued in respect of the Equity Securities referred
                      to in paragraph (a) above, the Board may also transfer the
                      further Equity Securities to the Trust notwithstanding
                      that the requirement that three dividends remain unclaimed
                      for at least one year after having been authorised may not
                      have been satisfied with respect to such further Equity
                      Securities.

           (c)        SALE BY TRUST: If at the end of a three year period
                      commencing on the date of transfer of the Equity
                      Securities to the Trust, and after 14 days' prior notice
                      of the intention to sell has been given, no person has
                      claimed ownership of the Equity Securities, the Board may
                      arrange for the sale of those Equity Securities through
                      the Exchange or in some other manner approved by the
                      Exchange.

           (d)        SALE PROCEDURES: To give effect to any transfers or sales
                      under paragraphs (a) to (c) of this clause, the Board may
                      authorise some person to execute an instrument of transfer
                      of the Equity Securities sold to, or in accordance with
                      the directions of, the transferee and an instrument of
                      transfer executed by that person will be as effective as
                      if it had been executed by the holder of, or person
                      entitled by transmission to, the Equity Securities. The
                      transferee will not be bound to see to the application of
                      the purchase monies nor will title to the Equity
                      Securities be affected by any irregularity or invalidity
                      in the exercise of the power of sale or the sale itself.

                                                                               4
<PAGE>
           (e)        PROCEEDS: Upon any sale of the Equity Securities by the
                      Trust, the net proceeds of sale (after deduction of
                      reasonable sale expenses) will belong to the Company. The
                      Board will, nevertheless, agree to pay the net proceeds of
                      sale to a claimant who produces satisfactory evidence of
                      entitlement but the Board will have no requirement to
                      account for any money earned on the net proceeds, which
                      may be employed in the business of the Company or invested
                      in such investments as determined by the Board.

2.16       CALLS, LIENS AND FORFEITURES: If, at any time, the terms of issue of
           any Equity Securities impose, or a holder of an Equity Security has,
           a liability to the Company (as a result of being partly paid or
           otherwise), then such Equity Securities and such holders will be
           subject to the provisions regarding calls, liens and forfeiture set
           out in schedule 4.

2.17       TRANSFERS OF SHARES:

           (a)        TRANSFEROR TO REMAIN HOLDER UNTIL REGISTRATION: The
                      transferor of a Share will remain the holder of the Share
                      until the name of the transferee is entered in the
                      Register.

           (b)        TRANSFER EXECUTED OUTSIDE NEW ZEALAND: Where an instrument
                      of transfer executed by a transferor outside New Zealand
                      would have complied with the provisions of the Securities
                      Transfer Act 1991 if it had been executed by the
                      transferor in New Zealand, it may nevertheless be
                      registered by the Company if it is executed in any usual
                      manner for execution by a corporation, or in any other
                      case if the signature of the transferor has been witnessed
                      by a person who has added his or her occupation and
                      address after his or her signature.

           (c)        POWER TO REFUSE TO REGISTER: The Board may decline to
                      register any transfer of Shares where:

                      (i)        the Company has a lien on any of the Shares; or

                      (ii)       the instrument of transfer is not accompanied
                                 by the certificate (if any) for the Shares to
                                 which it relates or other evidence as the Board
                                 may require to show the entitlement of the
                                 transferor to make the transfer; or

                      (iii)      registration, together with the registration of
                                 any further transfer then held by the Company
                                 and awaiting registration, would result in the
                                 proposed transferee holding Shares of less than
                                 a Minimum Holding of any Class,

                      provided that the Board resolves to exercise its powers
                      under this clause within 30 working days after receipt of
                      the relevant transfer and notice of the resolution is sent
                      to the transferor and to the transferee within five
                      working days of the resolution being passed by the Board.

           (d)        TRANSFER UNDER THE SECURITIES TRANSFER ACT: Any Shares
                      disposed of by an "authorised transaction" or a "stock
                      exchange transaction" within the meaning of the Securities
                      Transfer Act 1991 may be transferred by an instrument of
                      transfer complying with the provisions of that Act or by
                      an instrument complying with clause 2.17(e).

           (e)        OTHER TRANSFERS: Every instrument of transfer of Shares
                      not falling within clauses 2.17(b) and (d) shall comply
                      with the following provisions:

                      (i)        the form of the instrument of transfer shall be
                                 any usual or common form or any other form
                                 which the Board may approve;

                      (ii)       the instrument of transfer must be signed by or
                                 on behalf of the transferor; and

                                                                               5
<PAGE>
                      (iii)      where the Shares being transferred are not
                                 fully paid up, the instrument of transfer must
                                 also be signed or executed by or on behalf of
                                 the transferee.

           (f)        EVIDENCE OF OWNERSHIP: Every instrument of transfer shall
                      be delivered to the Company's share registrar, together
                      with the share certificate (if any) for the Shares to be
                      transferred. If there is no share certificate for those
                      Shares or if the share certificate has been lost, damaged
                      or destroyed, the transferee shall provide such other
                      evidence as the Board may reasonably require to show the
                      right of the transferor to make the transfer.

           (g)        SHARE TRANSFER SYSTEM: The Company may participate in any
                      share transfer system approved under the Securities
                      Transfer Act 1991 and implemented by the Exchange or in
                      any share transfer system which operates in relation to
                      trading in Securities on any other stock exchange on which
                      the Company's shares are traded and, in so participating,
                      it shall comply with the requirements of the Exchange or
                      of the relevant share transfer system. The Board may
                      register any transfer of Securities presented for
                      registration in accordance with the requirements of any
                      such system and will not be obliged to enquire as to the
                      due execution of any transfer effected by reason of such
                      system.

           (h)        TRANSFERS OF OTHER SECURITIES: This clause 2.17 shall
                      apply to transfers of Securities other than Shares with
                      any necessary modifications.

2.18       TRANSMISSION OF SHARES:

           (a)        TRANSMISSION ON DEATH OF SHAREHOLDER: If a Shareholder
                      dies the survivor, if the deceased was a joint
                      Shareholder, or the Shareholder's Personal Representative,
                      shall be the only persons recognised by the Company as
                      having any title to or interest in the Shares of the
                      deceased Shareholder. Nothing in this clause 2.18 shall
                      release the estate of a deceased Shareholder from any
                      liability in respect of any Share or constitute a release
                      of any lien which the Company may have in respect of any
                      Shares.

           (b)        RIGHTS OF PERSONAL REPRESENTATIVE: A Shareholder's
                      Personal Representative:

                      (i)        is entitled to exercise all rights (including
                                 without limitation the rights to receive
                                 distributions, to attend meetings and to vote
                                 in person or by Representative), and is subject
                                 to all limitations, attached to the Shares held
                                 by that Shareholder; and

                      (ii)       is entitled to be registered as holder of those
                                 Shares, but such registration shall not operate
                                 as a release of any rights (including any lien)
                                 to which the Company was entitled prior to
                                 registration of the Personal Representative
                                 pursuant to this paragraph (ii).

           (c)        JOINT PERSONAL REPRESENTATIVES: Where a Share is subject
                      to the control of two or more persons as Personal
                      Representatives, they shall, for the purposes of this
                      Constitution, be deemed to be joint holders of the Share.

2.19       SALE OF LESS THAN MINIMUM HOLDING: The Board may at any time give
           notice to any Shareholder holding less than a Minimum Holding of
           Shares of any Class that if, at the expiration of three months after
           the date such notice is given, the Shareholder still holds Shares
           which are less than a Minimum Holding, the Board may exercise the
           power of sale of those Shares set out in this clause. If that power
           of sale becomes exercisable:

           (a)        the Board may arrange for the sale of those Shares through
                      the Exchange or in some other manner approved by the
                      Exchange;

                                                                               6
<PAGE>
           (b)        the Shareholder shall be deemed to have authorised the
                      Company to act on the Shareholder's behalf and to execute
                      all necessary documents for the purposes of that sale;

           (c)        the Company shall account to the Shareholder for the net
                      proceeds of sale of the Shares (after deduction of
                      reasonable sale expenses), which shall be held on trust
                      for the Shareholder by the Company and paid to the
                      Shareholder on surrender of any certificates for the
                      Shares sold; and

           (d)        the title of a purchaser of any Shares sold pursuant to
                      this clause shall not be affected by any irregularity or
                      invalidity in the exercise of the power of sale or the
                      sale itself.

2.20       REGISTRATION OF SEPARATE PARCELS: The Company:

           (a)        may, on the request of a holder of Securities or a
                      transferee of Securities; and

           (b)        shall, if requested by a holder of Securities who produces
                      satisfactory evidence that the Securities he or she holds
                      are held as bare trustee or nominee and two or more other
                      persons are separate beneficial owners of parcels of those
                      Securities or have other separate relevant interests in
                      parcels of those Securities,

           register the Securities held or acquired by that holder of Securities
           or transferee in two or more separately identifiable parcels. The
           Company may thereafter, so far as it considers convenient,
           communicate with the holder of the Securities, pay dividends and
           otherwise act in respect of each parcel, as if the separately
           identifiable parcels belonged to different persons.

2.21       POWER TO DIVIDE REGISTER: The Register may be divided into two or
           more registers kept in different places.

2.22       APPLICATION OF NZSE TAKEOVER PROVISIONS: Pursuant to the ruling
           released by the NZSE on 1 June 2001 relating to the introduction of
           the takeovers code, section 4 of the Listing Rules (in the form in
           which it was incorporated in the Listing Rules as at 30 June 2001)
           will continue to apply and will be deemed to form part of this
           Constitution in respect of any non-compliance with that section which
           occurred prior to 1 July 2001 and will be applied on the basis that
           the "minority veto" notice and pause provisions were adopted by the
           Company.

3.         DIVIDENDS AND DISTRIBUTIONS

3.1        CURRENCY: The Board may differentiate between holders of Equity
           Securities as to the currency in which dividends are to be paid. In
           exercising that discretion, the Board may have regard to the
           registered address of a holder, the Register on which a holder's
           Equity Securities are registered and any other matter the Board
           considers appropriate. In any case where a dividend is to be paid in
           a currency other than New Zealand currency, the amount payable will
           be converted from New Zealand currency in a manner, at a time and at
           an exchange rate determined by the Board.

3.2        UNCLAIMED DIVIDENDS: Dividends or other monetary distributions
           unclaimed for one or more years after having been authorised may be
           used for the benefit of the Company until claimed. All dividends or
           other monetary distributions unclaimed for five years or more after
           having been authorised may be forfeited by the Board for the benefit
           of the Company. The Board may, nevertheless, agree to pay a claimant
           who produces evidence of entitlement.

                                                                               7
<PAGE>
3.3        DIVIDEND ELECTION PLANS: Without limiting the generality of clause
           2.6, the Board may implement and maintain, on such terms and
           conditions as it may determine, a plan for the benefit of the holders
           of Equity Securities whereby the holders of Equity Securities are
           issued Securities in lieu of a proposed dividend or invest the
           dividend in subscribing for or acquiring (on-market or otherwise)
           Securities or any other option in respect of the whole or any part of
           any dividend on any Equity Securities held by them as the Board may
           determine.

3.4        BONUS ISSUES: Subject to any applicable provisions of Schedule 1
           (including clause 4(b) of Schedule 1), the Board may resolve to apply
           any amount which is available for distribution to Shareholders
           either:

           (a)        in paying up in full Shares or other Securities to be
                      issued credited as fully paid to:

                      (i)        the Shareholders who would be entitled to that
                                 amount if it were distributed by way of
                                 dividend, and in the same proportions; and

                      (ii)       if applicable, the holders of any other
                                 Securities who are entitled by the terms of
                                 issue of those Securities to participate in
                                 bonus issues by the Company, whether at the
                                 time the bonus issue is made to the
                                 Shareholders, or at some time later, in
                                 accordance with their respective entitlements;
                                 or

           (b)        in paying up any amount which is unpaid on any Shares held
                      by the Shareholders referred to in paragraph (a)(i),

           or partly in one way and partly in the other.

3.5        DISTRIBUTION OF SURPLUS: Subject to the rights of the holders of any
           Equity Securities of the Company (including the rights of holders of
           Preference Shares and Ordinary Shares set out in clause 2.3) and to
           clause 3.6, upon the liquidation of the Company, the assets remaining
           (if any) after payment of the debts and liabilities of the Company
           and the costs of liquidation (the "surplus assets") will be
           distributed among the appropriate holders of Equity Securities in
           proportion to their holdings. If any holder's Equity Securities are
           not fully paid up, the liquidator of the Company may require those
           Equity Securities to be fully paid up before the holder receives any
           distribution of the surplus assets of the Company in respect of those
           Equity Securities. If the surplus assets are insufficient to repay
           the whole of the paid up Equity Securities, then, subject to the
           rights of holders of any Equity Securities of the Company (including
           the rights of holders of Preference Shares and Ordinary Shares set
           out in clause 2.3) such surplus assets will be distributed so that as
           nearly as may be the losses are borne by the holders of Equity
           Securities in proportion to their holdings.

3.6        DISTRIBUTION IN KIND: If the Company is liquidated, the liquidator
           may, with the approval of an Ordinary Resolution, divide among the
           holders of Equity Securities in kind the whole or any part of the
           assets of the Company (whether they consist of property of the same
           kind or not) and the liquidator may, for that purpose, set such value
           as the liquidator deems fair upon any property to be divided as
           aforesaid and may, subject to the terms of any Equity Securities
           (including the rights of holders of Preference Shares and Ordinary
           Shares set out in clause 2.3), determine how the division will be
           carried out as between the holders of Equity Securities or different
           Classes of Equity Securities. The liquidator may, with like sanction,
           vest the whole or any part of any such assets in a trust for the
           benefit of the holders of Equity Securities as the liquidator thinks
           fit, but so that no holders of Equity Securities will be compelled to
           accept any Securities on which there is any liability.

                                                                               8
<PAGE>
4.         SHAREHOLDERS' MEETINGS

4.1        ACT APPLIES: The provisions of the First Schedule to the Act govern
           proceedings at meetings of Shareholders except to the extent they are
           negated or modified by this Constitution.

4.2        MEETINGS OF OTHER GROUPS: A meeting of the holders of Securities in
           an interest group may be called by the Board at any time, and shall
           be called on the written request of persons holding Securities
           carrying together not less than 5% of the voting rights entitled to
           be exercised on any of the questions to be considered at the meeting
           of the group in question. All the provisions of this Constitution
           relating to meetings of Shareholders apply, with all necessary
           modifications, to a meeting of a group of Security holders, except
           that:

           (a)        the necessary quorum is three persons who are not
                      Associated Persons holding, or representing the holders
                      of, 10% or more of the total number of Securities having
                      the right to vote at the meeting;

           (b)        if the Board so elects, one meeting may be held of holders
                      constituting more than one group, so long as voting at
                      that meeting is by way of a poll, and proper arrangements
                      are made to distinguish between the votes of members of
                      each group; and

           (c)        any holder of Securities in the group, present in person
                      or by Representative, may demand a poll.

4.3        ENTITLEMENT TO NOTICE: Subject to rights attached to any Equity
           Securities, holders of Equity Securities of all Classes are entitled
           to attend meetings of Shareholders and to receive copies of all
           notices, reports and accounts issued generally to holders of
           Securities carrying votes.

4.4        METHOD OF SERVICE:

           (a)        COMPLIANCE WITH ACT: All notices, reports, accounts or
                      documents required to be sent to a holder of a Security
                      will be sent in the manner set out in the Act.

           (b)        SERVICE OF NOTICES OUTSIDE NEW ZEALAND: If a holder of
                      Securities has no registered address within New Zealand
                      and has not supplied to the Company an address within New
                      Zealand for the giving of notices, but has supplied an
                      address outside New Zealand, then notices are to be posted
                      to the holder at that address and will be deemed to have
                      been received by the holder 24 hours after the time of the
                      posting.

           (c)        JOINT HOLDERS: A notice may be given by the Company to the
                      joint holders of a Security by giving the notice to the
                      joint holder named first in the Register in respect of the
                      Security.

4.5        QUORUM: The quorum for a meeting of Shareholders is three persons
           having the right to vote at the meeting who are present in person.

4.6        CHAIRMAN: If no Chairman has been elected or if at any meeting of
           Shareholders the Chairman is not present within 15 minutes of the
           time appointed for the commencement of the meeting or the Chairman is
           unwilling or unable to act, the Directors present, if any, may elect
           one of their number to be chairman of the meeting. If no Director is
           willing to act as chairman or if no Director is present within 15
           minutes of the time appointed for the commencement of the meeting,
           the Shareholders present may choose one of their number to be
           chairman.

                                                                               9
<PAGE>
4.7        REGULATION OF PROCEDURE: Subject to the provisions of the Act and
           except as otherwise provided in this Constitution, the chairman may
           regulate the proceedings at meetings of Shareholders.

4.8        VOTES:

           (a)        NUMBER: Subject to clause 4.9 and subject to the rights or
                      restrictions attached to any Share:

                      (i)        on a vote by voice or by show of hands, each
                                 Shareholder present in person, by proxy or by
                                 Representative will have one vote; and

                      (ii)       on a poll, each Shareholder present in person,
                                 by proxy, by Representative or who submitted a
                                 postal vote will have:

                                 (A)        one vote per fully paid Share held
                                            by that Shareholder; and

                                 (B)        in respect of each Share held by
                                            that Shareholder which is not fully
                                            paid, a fraction of the vote or
                                            votes which would be exercisable if
                                            that Share was fully paid. That
                                            fraction must be equivalent to the
                                            proportion which the amount paid
                                            (not credited) is of the total
                                            amount paid and payable (excluding
                                            amounts credited and amounts paid in
                                            advance of a call).

           (b)        HOLDERS OF PREFERENCE SHARES AND ORDINARY SHARES VOTE
                      TOGETHER: The holders of Ordinary Shares and the holders
                      of Preference Shares will vote together on all matters
                      except on a vote relating to liquidation of the Company,
                      in which case a separate vote of the holders of Preference
                      Shares will be held.

4.9        VOTING RESTRICTIONS:

           (a)        RESTRICTIONS: Notwithstanding anything to the contrary in
                      this Constitution and the Listing Rules, a person is not
                      entitled to cast a vote on a resolution when that person
                      is disqualified from voting by the voting restrictions
                      contained in the Listing Rules.

           (b)        DEADLINE FOR CHALLENGE: Without prejudice to any remedy
                      (other than those which take legal effect against the
                      Company) which any holder of Securities may have against
                      any disqualified person who casts a vote at a meeting in
                      breach of paragraph (a) of this clause, no resolution of,
                      or proceeding at, that meeting will be impugned on the
                      basis of a breach of paragraph (a) of this clause. Any
                      objection by a holder of Securities to the accuracy or
                      completeness of any list of holders of Securities who are
                      disqualified from voting on a resolution pursuant to
                      paragraph (a) of this clause which has been supplied by
                      the Company to the Exchange or any holder of Equity
                      Securities pursuant to the Listing Rules will be
                      disregarded by the Company and the chairman of the
                      relevant meeting if it is notified to the Company later
                      than one full Business Day before the time fixed for
                      commencement of the meeting.


4.10       VOTES OF PERSONS IN DEFAULT: No person will be entitled at any
           meeting of Shareholders to exercise voting rights on any Equity
           Securities in respect of which any calls or other sums presently
           payable by that person remain unpaid.

4.11       VALIDITY OF VOTES: In the case of any dispute as to the admission or
           rejection of a vote, the chairman will determine the same and such
           determination will be conclusive.

                                                                              10
<PAGE>
4.12       POSTAL VOTES: Shareholders may exercise their right to vote at a
           meeting by casting a postal vote in accordance with the procedures
           relating to postal voting set out in the First Schedule to the Act,
           together with any other procedures determined by the Board.

4.13       PROXY FORM: A proxy form will be sent with each notice of meeting to
           holders of Quoted Securities and will:

           (a)        (so far as the subject matter and form of the resolutions
                      reasonably permits) provide for two-way voting on all
                      resolutions, enabling the holder of Securities to instruct
                      the proxy as to the casting of the vote;

           (b)        not be sent with any name or office (e.g., chairman)
                      filled in as proxy holder; and

           (c)        unless revoked in accordance with clause 4.16 or otherwise
                      expressly limited, if given for a particular meeting, be
                      valid for that meeting and any adjournment thereof without
                      the need for further lodging in respect of such adjourned
                      meeting.

           So far as is reasonably practicable, resolutions shall be framed in a
           manner which facilitates two-way voting instructions for proxy
           holders.

4.14       PROXY TO BE LODGED: Proxy forms must be deposited at the Office or
           with the Registrar or at such other place as is specified for that
           purpose in the notice convening the meeting at least 48 hours before
           the time for holding the meeting or adjourned meeting, or before such
           lesser time or in such other manner as the Board determines.
           Otherwise, the instrument of proxy will not be treated as valid.

4.15       APPOINTMENT OF PROXY: Deposit of a proxy form will not preclude the
           person giving the proxy attending and, where that person has
           withdrawn his or her proxy by giving notice to that effect to the
           Company prior to the last date for depositing proxies in accordance
           with clause 4.14, voting at the meeting or any adjournment of it.

4.16       VALIDITY OF PROXY VOTE: A vote given in accordance with the terms of
           an instrument of proxy shall be valid notwithstanding the previous
           death or mental disorder of the principal or revocation of the proxy
           or of the authority under which the proxy was executed, or the
           transfer of a Share in respect of which the proxy is given, if no
           written notice of such death, mental disorder, revocation or transfer
           has been received by the Company at its Office before commencement of
           the meeting or adjourned meeting at which the proxy is used.

4.17       USE OF POLLS: In addition to the methods set out in the Act, a poll
           at a meeting of Shareholders may be demanded by the chairman.

4.18       TIMING OF POLL: The chairman may determine the time and manner in
           which a poll is to be taken and any business other than that upon
           which a poll has been demanded may be proceeded with preceding the
           taking of the poll.

4.19       SCRUTINEERS: If a poll is taken, the scrutineers will be the auditors
           of the Company unless they are unable or unwilling to act or the
           chairman directs to the contrary, in which case the scrutineers will
           be appointed by the chairman.

4.20       DECLARATION OF RESULT OF POLL: The chairman may declare the result of
           a poll upon receiving a notice from the scrutineers that sufficient
           votes to determine the result of the resolution have been counted.

                                                                              11
<PAGE>
4.21       ADJOURNMENT:

           (a)        The chairman may at any time during the course of a
                      meeting of Shareholders adjourn:

                      (i)        the meeting; or

                      (ii)       any business, motion, question or resolution
                                 being considered, or remaining to be
                                 considered, by the meeting or any debate or
                                 discussion in relation to any of those matters.

           (b)        If directed by the meeting, the chairman must adjourn the
                      meeting.

           (c)        No business may be transacted at any adjourned meeting
                      other than the business left unfinished at the original
                      meeting. When a meeting is adjourned for 30 days or more,
                      notice of the adjourned meeting must be given as in the
                      case of an original meeting. Otherwise, it is not
                      necessary to give any notice of an adjournment or of the
                      business to be transacted at an adjourned meeting.

           (d)        Notwithstanding any other provision contained in this
                      Constitution, after any motion or proposal to adjourn the
                      meeting has been defeated, the chairman will have an
                      absolute discretion as to whether or not to accept and put
                      to the meeting any further motion or proposal to adjourn
                      the meeting.

4.22       UNRULY MEETINGS:

           (a)        CHAIRMAN MAY ADJOURN: If any meeting of Shareholders
                      becomes so unruly or disorderly, whether or not
                      accompanied by violence or threats of violence, that in
                      the opinion of the chairman the business of the meeting
                      cannot be conducted in a proper and orderly manner, or if
                      any meeting of Shareholders in the opinion of the chairman
                      becomes unduly protracted, the chairman may, and without
                      giving any reason, either exercise the powers vested in
                      the chairman under clause 4.21 or adjourn the meeting
                      indefinitely.

           (b)        EFFECT OF ADJOURNMENT: If any meeting of Shareholders is
                      adjourned by the chairman, whether for any fixed time or
                      indefinitely, pursuant to the foregoing provision then
                      with respect to any unfinished business of such meeting:

                      (i)        in respect of any resolution concerning the
                                 appointment and remuneration of the auditors,
                                 the meeting will be deemed to have resolved
                                 that such resolution is approved; and

                      (ii)       the chairman may direct that any item of
                                 business uncompleted at the meeting of which
                                 notice was given in the notice convening the
                                 meeting, and which, in his or her opinion,
                                 requires to be voted upon, be put to the vote
                                 by a poll, without further discussion, in
                                 accordance with the provisions of this
                                 Constitution.

4.23       ENTITLEMENT TO INFORMATION: No holder of Securities is entitled to
           receive any information concerning or held by the Company except such
           information as to the accounts and business of the Company as is
           expressly directed to be provided by this Constitution or by statute.
           No person is entitled to inspection of any books, papers,
           correspondence or documents of the Company, except so far as that
           inspection is expressly authorised by statute.

                                                                              12
<PAGE>
5.         DIRECTORS

5.1        NUMBER: The number of Directors must not at any time be more than
           nine or less than five. Subject to those limitations, the number of
           Directors to hold office will be fixed from time to time by the
           Board. At least two Directors must be ordinarily resident in New
           Zealand.

5.2        EXISTING DIRECTORS: The Directors in office at the date of adoption
           of this Constitution shall continue in office and shall be deemed to
           have been appointed pursuant to this Constitution.

5.3        APPOINTMENT AND REMOVAL BY ORDINARY RESOLUTION: A Director may be
           appointed to office as a Director by Ordinary Resolution. All
           Directors shall be subject to removal from office as a Director by
           Ordinary Resolution.

5.4        APPOINTMENT BY BOARD: The Board may at any time appoint additional
           Directors. A Director appointed by the Board will retire from office
           at the next annual meeting of Shareholders but will be eligible for
           re-election at that meeting.

5.5        NOMINATION OF DIRECTORS: No persons (other than a retiring Director)
           will be eligible for election as a Director at any meeting of
           Shareholders unless they or some other holder of Equity Securities
           entitled to attend and vote at the meeting intending to propose them
           have, not less than two months and not more than three months before
           the meeting, either left at the Office or forwarded to the Office by
           facsimile or other electronic transmission a notice in writing duly
           signed by the proposing holder of Equity Securities (if any) and also
           by the nominee giving his or her consent to the nomination and
           signifying their candidature for the Office or the intention of a
           holder of Equity Securities to propose them. Notice of each and every
           candidate for a Director received by the Company before the closing
           date for nominations must be forwarded by the Company to all persons
           entitled to attend the meeting together with, or as part of, the
           notice of meeting.

5.6        ROTATION: One third of the Directors, or, if their number is not a
           multiple of three, then the number nearest to one third, will retire
           from office at the annual meeting of Shareholders each year. The
           Directors to retire will be those who have been longest in office
           since their last appointment. In the case of Directors who were last
           appointed Directors on the same day, those to retire will be
           determined by agreement between those Directors or, if they cannot
           agree, by lot.

5.7        EXCEPTIONS TO ROTATION: The provisions of clause 5.6 will not apply
           to:

           (a)        Directors appointed pursuant to clause 5.4 and who are
                      subject to retirement pursuant to that clause. Those
                      Directors will not be included in the number of Directors
                      upon which the calculation of the number of Directors to
                      retire by rotation is made; and

           (b)        if the Company has executive Directors, one of those
                      executive Directors shall not be subject to retirement by
                      rotation. That executive Director shall be included in the
                      number of Directors upon which the calculation of the
                      number of Directors to retire by rotation is made.

5.8        APPOINTMENT OF DIRECTORS TO BE VOTED ON INDIVIDUALLY: No resolution
           to appoint or elect a Director (including a resolution to re-elect a
           Director appointed under clause 5.4) will be put to the holders of
           Securities unless the resolution is for the appointment of one
           Director. Nothing in this clause prevents the election of two or more
           Directors by ballot or poll.

5.9        RE-ELECTION AND ROTATION: Retiring Directors will be eligible for
           re-appointment or re-election. All retiring Directors may act as
           Directors throughout the meeting at which they retire.

                                                                              13
<PAGE>
5.10       VACATION OF OFFICE: A Director shall cease to hold office as a
           Director if the Director:

           (a)        becomes bankrupt or makes an arrangement or compromise
                      with the Director's creditors generally; or

           (b)        becomes disqualified from being a Director pursuant to
                      section 151 of the Act; or

           (c)        resigns from office by notice in writing to the Company;
                      or

           (d)        is removed from office pursuant to this Constitution or
                      the Act; or

           (e)        has for more than six months been absent without the
                      permission of the Board from meetings of the Board held
                      during that period.

5.11       TIME OF RETIREMENT AND APPOINTMENT:  If:

           (a)        a Director retires at a meeting of Shareholders and is not
                      re-elected or deemed to be re-elected at that meeting, the
                      Director shall remain in office until, and his or her
                      retirement shall take effect at, the conclusion of the
                      meeting;

           (b)        a Director is removed from office at a meeting of
                      Shareholders by Ordinary Resolution, the Director shall
                      remain in office until, and his or her removal shall take
                      effect at, the conclusion of the meeting; and

           (c)        a person who is not already a Director is appointed or
                      elected as a Director at a meeting of Shareholders, that
                      person shall take office as a Director immediately after
                      the conclusion of the meeting.

5.12       EXECUTIVE DIRECTOR: The Board may from time to time appoint one or
           more Directors to be an executive Director either for a fixed term
           (but not exceeding five years) or otherwise and on such terms
           (including remuneration) as the Board determines. The Board may from
           time to time remove any such executive Director and appoint another
           or others in his or her place. Any executive Director who is removed
           by resolution of the Board shall have no right or claim to continue
           in office and his or her only remedy against the Company (if any)
           shall be in damages.

5.13       RESIGNATION OF EXECUTIVE DIRECTOR: An executive Director shall,
           subject to the provisions of any contract between him or her and the
           Company, be subject to the same provisions concerning resignation,
           removal and disqualification as the other Directors. If an executive
           Director ceases to hold the office of Director from any cause he or
           she immediately ceases to be an executive Director.

5.14       NO ALTERNATES: No Director may appoint another person to act as
           alternate director for him or her.

5.15       BOARD MEETINGS - ACT APPLIES: The provisions of the Third Schedule to
           the Act govern proceedings of meetings of the Board, except to the
           extent they are negated or modified by this Constitution.

5.16       NOTICE OF BOARD MEETING: A Director or, if requested by a Director to
           do so, an employee of the Company approved by the Board for this
           purpose, may convene a meeting of the Board by giving notice in
           accordance with this clause. Each Director must be given notice of a
           meeting of the Board, unless the Director waives that right. Notice
           may be given to a Director in any of the following ways:

                                                                              14
<PAGE>
           (a)        by phone to the phone number given by the Director to the
                      Company for the purpose of receiving notices, in which
                      case the notice will be deemed to be given when the call
                      is made to that number; or

           (b)        by delivery of the notice to the Director, in which case
                      the notice will be deemed to be given when delivered; or

           (c)        by sending the notice by facsimile to the facsimile number
                      given by the Director for the purpose of receiving
                      notices, in which case the notice will be deemed to be
                      given when sent; or

           (d)        by posting the notice to the address given by the Director
                      for the purpose of receiving notices, in which case the
                      notice will be deemed to be given three working days after
                      it is posted.

5.17       QUORUM: Unless otherwise determined by the Board, one third of the
           Directors or the number nearest one third of the Directors will be
           the quorum necessary for the transaction of business of the Board. In
           no circumstances will the quorum be less than two.

5.18       CHAIRMAN CASTING VOTE: The Chairman at any meeting of the Board will
           not have a casting vote.

5.19       VOTING PRESUMPTION: A Director present at a meeting of the Board is
           presumed to have agreed to, and to have voted in favour of, a
           resolution of the Board unless he or she expressly dissents or
           abstains from, or votes against, the resolution.

5.20       INTERESTED DIRECTORS:

           (a)        Subject to paragraph (b) of this clause, a Director may
                      not vote at a meeting of the Board in respect of a matter
                      in which the Director is interested, and the Director will
                      not be counted in the quorum for the purposes of
                      consideration of the matter.

           (b)        A Director may vote in respect of and be counted in the
                      quorum for the purposes of a matter in which the Director
                      is interested if the matter is one in respect of which,
                      pursuant to an express provision of the Act, Directors are
                      required to sign a certificate or one which relates to the
                      grant of an indemnity pursuant to section 162 of the Act.

           In this clause the word "interested" has the meaning given to that
           word in section 139 of the Act.

5.21       PERSONAL INVOLVEMENT OF DIRECTORS: Notwithstanding any rule of law or
           equity to the contrary, but subject to clause 6.3 and sections 107(3)
           and 141 of the Act (relating to avoidance of transactions in which a
           director is interested) and section 199(2) of the Act (prohibiting a
           director from acting as auditor), a Director may:

           (a)        contract with the Company in any capacity;

           (b)        be a party to any transaction with the Company;

           (c)        have any direct or indirect personal involvement or
                      interest in any transaction or arrangement to which the
                      Company is a party or in which it is otherwise directly or
                      indirectly interested or involved;

                                                                              15
<PAGE>
           (d)        become a director or other officer of, or otherwise
                      interested in, any corporation promoted by the Company or
                      in which the Company may be directly or indirectly
                      interested as a shareholder or otherwise; and

           (e)        retain any remuneration, profit or benefit in relation to
                      any of the foregoing,

           and no contract or arrangement of any kind referred to in this clause
           may be avoided by reason of a Director being interested.

5.22       VALIDITY OF BOARD'S ACTS: All acts done by the Board or of a
           committee of the Board, or by any person acting as a Director, will,
           notwithstanding that it is afterwards discovered that there was some
           defect in the appointment of the Director or person acting as
           aforesaid or that they or any of them were disqualified, be as valid
           as if every person had been duly appointed and was qualified to be a
           Director.

5.23       INSUFFICIENT NUMBER OF DIRECTORS: The Directors may act
           notwithstanding any vacancy in their body, but if and for so long as
           their number is reduced below the number fixed by clause 5.1, the
           continuing Directors may act for the purpose of increasing the number
           of Directors to that number or of summoning a meeting of
           Shareholders, but for no other purpose.

5.24       AUTHORISED SIGNATORIES: In addition to the methods permitted by the
           Act, a contract or other enforceable obligation of the Company which,
           if entered into by a natural person, would, by law, be required to be
           by deed may be entered into on behalf of the Company in writing
           signed under the name of the Company by:

           (a)        a Director whose signature must be witnessed (if required
                      by law);

           (b)        a Director and any person who is designated as "Authorised
                      Signatory" from time to time by the Board, whose
                      signatures must be witnessed (if required by law); and

           (c)        any two persons who are designated as "Authorised
                      Signatories" from time to time by the Board, whose
                      signatures must be witnessed (if required by law).

5.25       DIRECTORS' REMUNERATION:

           (a)        FIXING REMUNERATION: No remuneration will be paid to a
                      Director in his or her capacity as a Director unless that
                      remuneration has been authorised by an Ordinary
                      Resolution. Each such resolution will express Directors'
                      remuneration as a monetary sum per annum payable to
                      either:

                      (i)        all Directors taken together; or

                      (ii)       any person who from time to time holds office
                                 as a Director.

           (b)        INCREASE IN NUMBER OF DIRECTORS: If remuneration is
                      expressed in accordance with sub-paragraph (i) of
                      paragraph (a) of this clause, then in the event of an
                      increase in the total number of Directors holding office,
                      the Directors may, without the authorisation of an
                      Ordinary Resolution, increase the total remuneration by
                      such amount as is necessary to enable the Company to pay
                      to the additional Director or Directors remuneration not
                      exceeding the average amount then being paid to each of
                      the other non-executive Directors (other than the
                      Chairman, deputy chairman or chairman of a Board
                      committee).

                                                                              16
<PAGE>
           (c)        NOTICE OF INCREASE: No resolution which increases the
                      amount fixed pursuant to a previous resolution will be
                      passed at a meeting of Shareholders unless notice of the
                      amount of increase has been given in the notice of
                      meeting.

           (d)        BOARD'S DISCRETION: If remuneration is expressed in
                      accordance with sub-paragraph (i) of paragraph (a) of this
                      clause, the remuneration may be distributed among the
                      Directors in such manner as the Board determines.

           (e)        EXECUTIVE DIRECTORS: Nothing in paragraphs (a) to (c) of
                      this clause will affect the remuneration of executive
                      Directors in their capacity as executives, subject to
                      clause 6.3.

           (f)        EXPENSES: Each Director is entitled to be paid for all
                      reasonable travelling, accommodation and other expenses
                      incurred by the Director in connection with the Director's
                      attendance at meetings or otherwise in connection with the
                      Company's business.

           (g)        SPECIAL REMUNERATION: Notwithstanding paragraph (a) of
                      this clause, but subject to any applicable restriction in
                      the Listing Rules, the Board may authorise special
                      remuneration to any non-executive Director who is or has
                      been engaged by the Company to carry out any work or
                      perform any services which in the opinion of the Board is
                      or are additional to the work or services usually required
                      of directors of a company similar to the Company.

5.26       INDEMNITY FOR DIRECTORS: Every Director shall be indemnified by the
           Company for any costs referred to in section 162(3) of the Act and
           any liability or costs referred to in section 162(4) of the Act.

5.27       OTHER INDEMNITIES AND INSURANCE: In addition to the indemnity set out
           in clause 5.26, the Company may:

           (a)        indemnify a Director or employee of the Company or a
                      related company for any costs referred to in section
                      162(3) of the Act;

           (b)        indemnify a director or employee of the Company or a
                      related company in respect of any liability or costs
                      referred to in section 162(4) of the Act; and

           (c)        effect insurance for a director or employee of the Company
                      or a related company in respect of any liability or costs
                      referred to in section 162(5) of the Act.

5.28       INTERPRETATION: Words given extended meanings by section 162(9) of
           the Act have those extended meanings in this clause 5.

6.         TRANSACTIONS

6.1        GENERAL RESTRICTION: The Company may not enter into any transaction
           or series of linked or related transactions to acquire, sell, lease,
           exchange or otherwise dispose of (otherwise than by way of charge)
           assets of the Company or assets to be held by the Company:

           (a)        which would change the essential nature of the business of
                      the Company; or

           (b)        in respect of which the gross value is in excess of 50% of
                      the lesser of the Average Market Capitalisation or the
                      Gross Value of Assets of the Company,

                                                                              17
<PAGE>
           except where entry into the transaction or series of linked or
           related transactions is the subject of the prior approval of an
           Ordinary Resolution (or a Special Resolution if section 129 of the
           Act applies to the transaction or transactions).

6.2        EXCEPTION: Clause 6.1 will not apply to any transaction entered into
           by the Company with a Bank (as defined in the Listing Rules), on arms
           length terms and in the ordinary course of banking business, as a
           result of which transaction the Company has recourse to the credit
           risk of a Bank.

6.3        RESTRICTION ON MATERIAL TRANSACTIONS WITH RELATED PARTIES: The
           Company will not enter into a Material Transaction if a Related Party
           is, or is likely to become:

           (a)        a direct or indirect party to the Material Transaction, or
                      to at least one of a related series of transactions of
                      which the Material Transaction forms part; or

           (b)        in the case of a guarantee or other transaction of the
                      nature referred to in paragraph (c) of the definition of
                      Material Transaction, a direct or indirect beneficiary of
                      such guarantee or other transaction,

           unless that Material Transaction is approved by an Ordinary
           Resolution.

6.4        EXCEPTION: Clause 6.3 will not apply to:

           (a)        any transaction entered into by the Company with a Bank
                      (as defined in the Listing Rules) which is a Related Party
                      of the Company, on arms length terms and in the normal
                      course of banking business, as a result of which
                      transaction the Company has recourse to the credit risk of
                      a Bank; or

           (b)        the issue, acquisition or redemption by the Company of
                      Securities, or the giving by the Company of financial
                      assistance for the purposes of, or in connection with, the
                      purchase of Securities, or the payment of a distribution
                      to holders of Securities, if all holders of Securities of
                      the Class in question are treated in the same way, so that
                      each such holder has an opportunity to receive the same
                      benefit in respect of each Security held by that holder.
                      For the purposes of this paragraph, the transfer by the
                      Company of Shares held by the Company in itself, will be
                      deemed to constitute an issue of Securities; or

           (c)        any employment or services contracts which are Material
                      Transactions under paragraph (d) of the definition of
                      "Material Transaction" where the Exchange is satisfied
                      that the terms of the contract have been set on an arms'
                      length, commercial basis; or

           (d)        any transaction indemnifying any Director or Employee of
                      the Company or a Related Company (as that term is defined
                      in the Listing Rules) which would be a Material
                      Transaction under paragraph (c) of the definition of
                      "Material Transaction", where such Director or Employee,
                      at the time the indemnity is to be granted, has not been
                      involved in any proceedings, threatened proceedings or
                      circumstances in any capacity which are likely to result
                      in a claim by the Director or Employee under the proposed
                      indemnity; or

           (e)        arrangements, amalgamations or compromises pursuant to
                      Part XV of the Act.


6.5        CONDITIONAL ARRANGEMENTS: Nothing in this clause 6 will prevent the
           Company entering into any agreement or arrangement to do any of the
           things to which that clause relates if the agreement or arrangement
           is conditional upon the approval of an Ordinary Resolution and the
           agreement or arrangement is not completed until that approval is
           obtained.

                                                                              18
<PAGE>
6.6        APPLICATION TO GROUP: References to the Company in this clause 6
           will, where the context permits, be extended to the Group.

                                                                              19
<PAGE>
SCHEDULE 1:  ISSUES OF NEW EQUITY SECURITIES (CLAUSE 2.6)

1.         REQUIREMENTS FOR ISSUE

           The Company shall not issue any Equity Securities unless:

           (a)        the precise terms and conditions of the specific proposal
                      to issue those Equity Securities have been approved
                      (subject to clause 2 of this schedule) by separate
                      resolutions (passed by a simple majority of votes of those
                      holders entitled to vote and voting on the question) of
                      holders of each Class of Quoted Equity Securities whose
                      rights or entitlements could be affected by the issue and
                      the issue is completed within the time specified in clause
                      3 of this schedule; or

           (b)        the issue is made in accordance with any of clauses 4 to 8
                      of this schedule.

2.         EXCEPTION TO REQUIREMENT FOR SEPARATE RESOLUTIONS

           A resolution pursuant to clause 1(a) of this schedule of the holders
           of a Class of Securities shall not be required if:

           (a)        those Securities were issued before 1 September 1994 on
                      terms that the holders of those Securities would not be
                      entitled to vote on a resolution of the nature referred to
                      in clause 1(a) of this schedule; or

           (b)        the terms of issue of those Securities expressly reserved
                      the right to make the issue of the new Equity Securities
                      in question, and specified at least the maximum number,
                      and Class, of new Equity Securities which could be issued,
                      and the time within which they could be issued; or

           (c)        those Securities were issued on terms that the holders of
                      those Securities would vote together with the holders of
                      another Class or Classes of Equity Securities on a
                      resolution of the nature referred to in clause 1(a) of
                      this schedule and the issue is approved by a resolution
                      (passed by a simple majority of votes of those holders
                      entitled to vote and voting on the question) of holders of
                      all the relevant Classes voting together. Holders of
                      Ordinary Shares and Preference Shares will vote together
                      on a resolution of the nature referred to in clause 1(a)
                      of this Schedule.

3.         TIME LIMIT

           An issue of Equity Securities authorised by resolutions passed
           pursuant to clause 1(a) of this schedule shall be completed:

           (a)        if that issue is made solely to Employees, within 12
                      months after the passing of those resolutions; or

           (b)        in all other circumstances, within six months after the
                      passing of those resolutions,

           provided that nothing in this clause or clause 1(a) of this schedule
           shall require the Board to issue all or part of the Equity Securities
           approved for issue pursuant to clause 1(a) of this schedule, if the
           issue of such Equity Securities is at the discretion of the Board.

                                                                              20
<PAGE>
4.         PRO-RATA ISSUES

           The Company may issue Equity Securities if:

           (a)        those Equity Securities are offered to holders of existing
                      Equity Securities on a basis which, if the offer were
                      accepted by all such holders, would maintain the existing
                      proportionate rights of each existing holder (relative to
                      other holders of Equity Securities) to votes and to
                      Distribution Rights, and that offer is Renounceable; or

           (b)        those Equity Securities are issued to holders of existing
                      Equity Securities as fully paid Securities on a basis
                      which maintains the existing proportionate rights of each
                      existing holder (relative to other holders of Equity
                      Securities) to votes and to Distribution Rights.

           Notwithstanding paragraphs (a) and (b) of this clause, the Company
           may:

           (c)        issue any Equity Securities in respect of which an offer
                      is not accepted, or which because of fractional
                      entitlements are not otherwise offered, to such persons
                      and in such manner as the Directors consider equitable and
                      in the interests of the Company, provided that the price
                      and terms and conditions of the issue of such Equity
                      Securities are not materially more favourable to the
                      persons to whom they are issued than the terms of the
                      original offer;

           (d)        offer and issue Equity Securities to the holders of
                      existing Securities in accordance with specific rights
                      attached to those existing Securities to participate in
                      issues of Equity Securities, notwithstanding that the
                      effect may be that existing proportionate rights to votes
                      and Distribution Rights are not maintained;

           (e)        authorise a disproportionate offer to the extent necessary
                      to round up holdings of Equity Securities to a Minimum
                      Holding, or to avoid the creation of holdings which are
                      not Minimum Holdings; and

           (f)        not offer or issue Equity Securities to holders of
                      existing Equity Securities the terms of which expressly
                      exclude the right to participate in the relevant offer or
                      issue.

5.         ISSUES WITHIN 10% LIMIT

           The Board may issue Equity Securities if:

           (a)        the issue is not made in whole or in part to any Director,
                      Associated Person of a Director or Employee; and

           (b)        the total number of Equity Securities issued, and all
                      other Equity Securities of the same Class issued pursuant
                      to this clause (or the corresponding provision in the
                      previous constitution of the Company) during the period of
                      12 months preceding the date of the issue will not exceed
                      the aggregate of:

                      (i)        10% of the total number of Equity Securities of
                                 that Class on issue at the commencement of that
                                 period; and

                      (ii)       10% of the number of the Equity Securities of
                                 that Class issued during that period pursuant
                                 to any of clause 1(a), and clauses 4, 6 and 8
                                 of this schedule (or any of the corresponding
                                 provisions in the previous constitution of the
                                 Company); and

                                                                              21
<PAGE>
                      (iii)      any Securities of that Class issued pursuant to
                                 this clause 5 (or the corresponding provision
                                 in the previous constitution of the Company)
                                 during that period, the issue of which has been
                                 ratified by an Ordinary Resolution;

                      less

                      (iv)       10% of the number of Equity Securities of that
                                 Class which have been acquired or redeemed by
                                 the Company during that period (other than
                                 Equity Securities held as Treasury Stock).

           Provided that for the purposes of paragraph (b) of this clause,
           Securities which will, or may, Convert to other Equity Securities
           shall be deemed to be of the same Class as, and to correspond in
           number to, the Equity Securities into which they will or may Convert.
           For the purposes of this clause, Preference Shares shall be deemed
           not to Convert into Ordinary Shares.

           Provided also that where the Conversion ratio is fixed by reference
           to the market price of the underlying Securities, the market price,
           unless otherwise specified in the terms of issue of the Securities,
           will be the average end of day market price over the Business Days in
           the calendar month before the earlier of the day the issue is made or
           announced to the market.

6.         EMPLOYEE SHARE ISSUES

           The Company may issue Equity Securities if:

           (a)        the issue is made to Employees;

           (b)        the issue is of a Class of Securities already on issue;

           (c)        the total number of Securities issued, and all other
                      Equity Securities of the same Class issued to Employees
                      pursuant to this clause 6 (or the corresponding provision
                      in the previous constitution of the Company) during the
                      period of 12 months preceding the date of the issue, does
                      not exceed 2% of the aggregate of:

                      (i)        the total number of Equity Securities of that
                                 Class on issue at the commencement of that
                                 period; and

                      (ii)       the total number of Equity Securities of that
                                 Class issued during that period pursuant to any
                                 of clause 1(a), and clauses 4, 5 and 8 of this
                                 schedule (or any of the corresponding
                                 provisions in the previous constitution of the
                                 Company); and

           (d)        the total number of Securities issued, and all other
                      Equity Securities of the same Class issued to Employees
                      pursuant to this clause 6 (or the corresponding provision
                      in the previous constitution of the Company) during the
                      period of five years preceding the date of the issue, does
                      not exceed 5% of the total number of Equity Securities of
                      that Class on issue immediately preceding the date of the
                      issue.

           For the purposes of this clause, Securities which will, or may,
           Convert to other Equity Securities shall be deemed to be of the same
           Class as, and to correspond in number to, the Equity Securities into
           which they will, or may, Convert. For the purposes of this clause,
           Preference Shares shall be deemed not to Convert into Ordinary
           Shares.

           Directors and Associated Persons of Directors must not participate in
           any such issue unless the scheme for such participation and the
           precise levels of entitlement for each such person have been
           previously approved by an Ordinary Resolution.

                                                                              22
<PAGE>
7.         EXCEPTION FOR SCHEME TRUSTEES

           For the purposes of clause 6 of this schedule, an issue to a
           Director, or an Associated Person of a Director, solely in that
           person's capacity as a trustee of a bona fide employee share scheme,
           superannuation scheme, or the like, in which that Director or
           Associated Person has no beneficial interest, shall be deemed not to
           be an issue to a Director or Associated Person of a Director, or an
           issue in which Directors or Associated Persons participate.

8.         OTHER ISSUES

           The Company may issue Equity Securities if:

           (a)        the issue is made as consideration in an offer made by the
                      Company or any of its subsidiaries in accordance with:

                      (i)        the takeovers code approved under the Takeovers
                                 Code Approval Order 2000 or any subsequent
                                 takeovers code approved under section 28 of the
                                 Takeovers Act 1993; or

                      (ii)       any provisions of the constitution or trust
                                 deed of another issuer which is listed on the
                                 Exchange which are required to be complied with
                                 in accordance with section 4 of the Listing
                                 Rules; or

                      (iii)      any takeover law regime of a jurisdiction other
                                 than New Zealand which provides for prior
                                 notice, publicity and disclosure which in the
                                 opinion of the Exchange is at least as useful
                                 to the recipients of the offer as the
                                 requirements of one or more of the provisions
                                 referred to in sub-paragraphs (i) or (ii) of
                                 this clause,

                      and that offer is made to all holders (other than the
                      Company and its Related Companies (as defined in the
                      Listing Rules)) of equity securities in any company or
                      other entity listed on the Exchange or on a Recognised
                      Stock Exchange which is not a company or other entity that
                      is an Associated Person of the Company or of any Director;
                      or

           (b)        the issue is made upon conversion of any Securities from
                      time to time issued by the Company if the terms of issue
                      of those Securities provided for conversion to Equity
                      Securities of the kind issued; or

           (c)        the issue is made to an existing holder of Equity
                      Securities in order to bring that holder's holding up to a
                      Minimum Holding; or

           (d)        the issue is made pursuant to an arrangement, amalgamation
                      or compromise effected pursuant to Part XIII or Part XV of
                      the Act; or

           (e)        the issue is made pursuant to a plan for the issue of
                      Securities in lieu of dividends.


9.         TREASURY STOCK

           The transfer by the Company of Treasury Stock shall be deemed to
           constitute the issue of Equity Securities for the purposes of this
           schedule.

                                                                              23
<PAGE>
10.        ISSUES OF SECURITIES AFFECTING CONTROL

           Notwithstanding the other clauses of this schedule, no issue of
           Securities shall be made by the Company if:

           (a)        there is a significant likelihood that the issue will
                      result in any person or group of Associated Persons
                      materially increasing their ability to exercise, or direct
                      the exercise of (either then or at any future time),
                      effective control of the Company; and

           (b)        that person or group of Associated Persons is entitled
                      before the issue to exercise, or direct the exercise of,
                      not less than 1% of the total votes attaching to
                      Securities,

           unless the precise terms and conditions of the issue have been
           approved by an Ordinary Resolution.

11.        ENTITLEMENTS TO THIRD PARTY SECURITIES

           Entitlements conferred by the holding of Equity Securities, to
           securities of a third party (whether or not that third party is an
           issuer listed on the Exchange), will not be created or conferred
           other than in compliance with clauses 1 to 8 of this schedule, as if
           such securities comprised an issue of Equity Securities of the
           Company.

                                                                              24
<PAGE>
SCHEDULE 2:  BUYBACKS OF EQUITY SECURITIES (CLAUSE 2.13)

1.         PROHIBITION ON ACQUISITION

           Subject to clause 2 of this schedule, the Company shall not acquire
           any Equity Securities unless the acquisition is:

           (a)        effected by offers made by the Company through the
                      Exchange's order matching market, or through the order
                      matching market of a Recognised Stock Exchange; or

           (b)        effected in compliance with section 60(1)(a) of the Act
                      (read together with section 60(2) of the Act); or

           (c)        an acquisition of the nature referred to in section 61(7)
                      of the Act; or

           (d)        approved in accordance with clause 4 of this schedule; or

           (e)        required by a Shareholder pursuant to section 110 or
                      section 118 of the Act; or

           (f)        is made in accordance with the procedures set out in
                      section 60(1)(b)(ii) of the Act (read together with
                      section 61 of the Act); and

                      (i)        the acquisition is not made in whole or in part
                                 from any Director, Associated Person of a
                                 Director or Employee; and

                      (ii)       the total number of Equity Securities acquired,
                                 and all other Equity Securities of the same
                                 Class acquired pursuant to this clause 1(f) (or
                                 the corresponding provision of the previous
                                 constitution of the Company) during the 12
                                 months preceding the date of the acquisition
                                 will not exceed 10% of the total number of
                                 Equity Securities of that Class on issue at the
                                 commencement of that period.

                      Provided that for the purposes of this clause 1(f),
                      Securities which will, or may, Convert to other Equity
                      Securities shall be deemed to be of the same Class as, and
                      correspond in number to, the Equity Securities into which
                      they will, or may, Convert. For the purposes of this
                      clause, the Preference Shares shall be deemed not to
                      Convert into Ordinary Shares.

                      Provided also that where the Conversion ratio is fixed by
                      reference to the market price of the underlying
                      Securities, the market price for the purposes of this
                      clause 1(f) shall be the average end of day market price
                      over the Business Days in the calendar month before the
                      earlier of the day the acquisition is entered into or
                      announced to the market.

2.         PRIOR NOTICE OF ACQUISITION

           Before the Company acquires Equity Securities other than an
           acquisition from a holder who holds less than a Minimum Holding, the
           Company will give at least three Business Days' notice to the
           Exchange.

           That notice will:

           (a)        specify a period of time within which the Company will
                      acquire Equity Securities, such period not to exceed 12
                      months from the date of the notice; and

                                                                              25
<PAGE>
           (b)        specify the Class and maximum number of Equity Securities
                      to be acquired in that period.

           The Company may at any time by giving three Business Days' notice to
           the Exchange vary any notice so given and may cancel such notice at
           any time.

3.         PROHIBITION ON REDEMPTION

           The Company shall not redeem Equity Securities other than a
           redemption from a holder who holds less than a Minimum Holding
           unless:

           (a)        those Equity Securities were issued in compliance with
                      clause 1(a) of schedule 1 or clause 4 of schedule 1 and
                      the Company is bound or entitled to redeem those Equity
                      Securities pursuant to the terms of their issue; or

           (b)        those Equity Securities are redeemed in compliance with
                      section 69(1)(a) of the Act; or

           (c)        those Equity Securities are Debt Securities of the Company
                      which may be Converted into Shares and, before that
                      Conversion, they are redeemed in cash; or

           (d)        the redemption of those Equity Securities is approved in
                      accordance with clause 4 of this schedule; or

           (e)        those Equity Securities were issued before 1 September
                      1994 and the Company is bound or entitled to redeem those
                      Equity Securities pursuant to their terms of issue.

4.         SHAREHOLDER APPROVAL

           The Company may acquire or redeem Equity Securities if the precise
           terms and conditions of the specific proposal to acquire or redeem
           those Equity Securities has been approved by separate resolutions
           (passed by a simple majority of votes) of members of each separate
           group of each Class of Quoted Equity Securities whose rights or
           entitlements are materially affected in a similar way by the
           acquisition or redemption. Any such acquisition shall be completed
           within 12 months, and redemption completed within six months, after
           the passing of the relevant resolutions. Holders of Ordinary Shares
           and Preference Shares will vote together on a resolution of the
           nature referred to in this clause 4.

5.         BUYBACKS OF SECURITIES AFFECTING CONTROL

           Notwithstanding the other clauses of this schedule, no acquisition or
           redemption of Securities shall be made by the Company if:

           (a)        there is a significant likelihood that the acquisition or
                      redemption will result in any person or group of
                      Associated Persons materially increasing their ability to
                      exercise, or direct the exercise of (either then or at any
                      future time), effective control of the Company; and

           (b)        that person or group of Associated Persons is entitled
                      before the acquisition or redemption to exercise, or
                      direct the exercise of, not less than 1% of the total
                      votes attaching to Securities,

           unless the precise terms and conditions of the acquisition or
           redemption have been approved by an Ordinary Resolution.

                                                                              26
<PAGE>
6.         ACQUISITION OR REDEMPTION OF EQUITY SECURITIES OTHER THAN SHARES

           Equity Securities which are not Shares of the Company may be acquired
           under clauses 1(b), (c) and (f) of this schedule, or redeemed under
           clause 3(b) of this schedule, if the Company complies with the
           sections of the Act referred to in those clauses on the basis that
           references in those sections of the Act to:

           (a)        "shares" shall be deemed to be references to all Equity
                      Securities of the Class of Equity Securities which is the
                      subject of the acquisition or redemption and references to
                      "shareholders" shall be read accordingly; and

           (b)        "constitution" shall be deemed to be references to the
                      document which governs the rights of those Equity
                      Securities.

                                                                              27
<PAGE>
SCHEDULE 3:  PERMITTED FINANCIAL ASSISTANCE (CLAUSE 2.14)

1.         PERMITTED FINANCIAL ASSISTANCE

           The Company shall not give financial assistance of the nature
           referred to in clause 2.14 unless:

           (a)        the financial assistance is not given in whole or in part
                      to any Director, Associated Person of a Director or
                      Employee and the amount of the financial assistance,
                      together with the amount of all other financial assistance
                      given under this paragraph (a) (or the corresponding
                      provision of the previous constitution of the Company) by
                      the Company during the period of 12 months preceding the
                      date of giving of the financial assistance does not exceed
                      5% of Shareholders' Funds; or

           (b)        the financial assistance is given to Employees and:

                      (i)        the amount of the financial assistance,
                                 together with the amount of all other financial
                                 assistance given under this paragraph (b) (or
                                 the corresponding provision of the previous
                                 constitution of the Company) by the Company
                                 during the period of 12 months preceding the
                                 date of giving of the financial assistance does
                                 not exceed 2% of Shareholders' Funds; and

                      (ii)       the amount of the financial assistance,
                                 together with the amount of all other financial
                                 assistance given under this paragraph (b) (or
                                 the corresponding provision of the previous
                                 constitution of the Company) during the period
                                 of five years preceding the date of giving of
                                 the financial assistance does not exceed 5% of
                                 Shareholders' Funds; and

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

           (c)        the financial assistance is offered or given so that all
                      holders of Equity Securities are treated, or given the
                      opportunity to be treated, on the same basis.

2.         SHAREHOLDER APPROVAL

           The Company may give financial assistance of the nature referred to
           in clause 2.14 if the precise terms and conditions of the giving of
           that financial assistance have been approved by separate resolutions
           (passed by a simple majority of votes) of members of each separate
           group of each Class of Quoted Equity Securities whose rights or
           entitlements are materially affected in a similar way by the
           financial assistance. Any such financial assistance shall be given
           within six months after the passing of the relevant resolutions.
           Holders of Ordinary Shares and Preference Shares will vote together
           on a resolution of the nature referred to in this clause 2.

3.         EXCEPTION FOR SCHEME TRUSTEE

           For the purposes of clause 1(b)(iii) of this schedule, financial
           assistance given to a Director, or an Associated Person of a
           Director, solely in that person's capacity as a trustee of a bone
           fide employee share scheme, superannuation scheme, or the like, in
           which that Director or Associated Person has no beneficial interest,
           shall be deemed not to be financial assistance given to a Director or
           Associated Person of a Director.

                                                                              28
<PAGE>
SCHEDULE 4:  CALLS, LIENS AND FORFEITURES (CLAUSE 2.15)

1.         CALLS

1.1        POWER TO MAKE CALLS: Subject to the terms of issue, the Board may
           make such calls as it thinks fit upon the holders of Securities in
           respect of all or any of the moneys unpaid on their Securities. At
           least 21 days' notice of each call must be given, specifying the time
           and place for payment. Each holder of Securities must pay the amount
           of every call so made at the times and places appointed by the Board.
           The Board may determine that a call is payable by instalments.

1.2        WHEN A CALL IS MADE: Unless otherwise specified, a call will be
           deemed to have been made at the time when the resolution of the Board
           authorising the call was passed.

1.3        LIABILITY OF JOINT HOLDERS: The joint holders of a Security are
           jointly and severally liable to pay all calls in respect of that
           Security and shall remain liable to do so notwithstanding the
           subsequent transfer of the relevant Security.

1.4        INTEREST ON UNPAID CALLS: If a call remains unpaid after it has
           become due and payable, the person from whom the sum is due must pay
           interest on the unpaid sum at such rate as the Board may determine.
           Interest will accrue from the day it became due until it is paid. The
           Board may waive payment of that interest wholly or in part.

1.5        INSTALMENTS TO BE TREATED AS CALLS: Any sum payable in respect of a
           Security on allotment or at any fixed date will be deemed to be a
           call. If it is not paid, the provisions of this Constitution will
           apply as if that sum had become due and payable by virtue of a call.

1.6        DIFFERENCE IN CALLS: The Board may, on the issue of Securities,
           differentiate between the holders as to the amount of calls to be
           paid and the times of payment.

1.7        CALLS IN ADVANCE: The Board may, in its discretion, receive any
           moneys uncalled and unpaid upon any Securities in advance of its due
           date and may pay interest on the amount received at such rate (if
           any) and on such terms as the Board determines.

1.8        EVIDENCE: In any proceedings for the recovery of moneys due in
           respect of any call a statutory declaration by a Director or any
           other person authorised by the Board that:

           (a)        the name of the holder of the Securities is entered in the
                      Register as the holder (or one of the holders) of the
                      relevant Securities;

           (b)        the resolution making the call is recorded in the records
                      of the Company; and

           (c)        notice of the call was sent to the holders of the
                      Securities,

           will be conclusive evidence of the indebtedness of the holder of the
           Securities to the Company in respect of the call.

1.9        CANCELLATION OF UNPAID AMOUNTS: No obligation to pay any amount which
           is unpaid on any Equity Security will be cancelled, reduced or
           deferred without the authority of an Ordinary Resolution.

                                                                              29
<PAGE>
2.         LIEN ON SECURITIES

2.1        LIEN ON UNPAID AND PARTLY PAID SECURITIES: The Company will have a
           first and paramount lien on every Security which is not a fully paid
           Security (and any dividends or other distributions in respect of that
           Security) for:

           (a)        all unpaid calls, instalments or other amounts, and any
                      interest payable on those amounts, relating to that
                      Security; and

           (b)        any amounts the Company may be called upon to pay under
                      any legislation in respect of that Security.

2.2        LIABILITY OF TRANSFEREE WHO IS GIVEN NOTICE OF LIEN: Transferees of
           Securities who, prior to the registration of the transfer, have been
           given notice of the Company's lien upon such Securities will be
           liable to pay to the Company, upon demand, all moneys for the time
           being called up and unpaid in respect of the Securities transferred
           to them, together with any interest thereon as herein provided.

2.3        POWER OF SALE: If any amount due in respect of a Security on which
           the Company has a lien is unpaid for more than 14 days after notice
           in writing demanding payment has been given to the holder or the
           person entitled to receive notices in respect of that Security:

           (a)        the Company may sell the Security on such terms as the
                      Board determines; and

           (b)        to give effect to any such sale, the Board may authorise
                      any person to execute a transfer of the Security to, or at
                      the direction of, the purchaser.

2.4        ABSOLUTE TITLE OF PURCHASER: The title of a purchaser of any
           Securities sold pursuant to clause 2.3 of this schedule will not be
           affected by any irregularity or invalidity in the exercise of the
           power of sale or the sale itself.

2.5        APPLICATION OF SALE PROCEEDS: The net proceeds of sale of any
           Security sold pursuant to clause 2.3 of this schedule, after
           deducting expenses of sale, shall be applied in and towards
           satisfaction of any unpaid calls, instalments or other amounts and
           any interest on those amounts and the balance (if any) will be paid
           to the person entitled to the Security at the date of sale.

3.         FORFEITURE OF SECURITIES

3.1        NOTICE: If a call on a Security is not paid when due, the Board may
           give 14 days' notice to the holder of the Security requiring payment
           of the call, together with interest on the amount of the call. The
           notice will specify the place of payment and state that if the notice
           is not complied with the relevant Security will be liable to be
           forfeited.

3.2        FORFEITURE: If the notice is not complied with, the Security may,
           before payment of the overdue amount has been made, be forfeited by
           resolution of the Board. Such forfeiture will include all dividends
           and any other distributions declared in respect of forfeited
           Securities and not paid or satisfied before forfeiture.

3.3        SALE OF FORFEITED SECURITIES: A forfeited Security may be sold or
           otherwise disposed of on such terms and in such manner as the Board
           determines. To give effect to any sale or disposal the Board may
           authorise any person to execute any relevant documentation. The Board
           may, at any time before the sale or disposal, cancel the forfeiture.

                                                                              30
<PAGE>
3.4        APPLICATION OF SALE PROCEEDS: The net proceeds of sale of any
           forfeited Security will be applied in the same manner as set out in
           clause 2.5 of this schedule.

3.5        ABSOLUTE TITLE OF PURCHASER: The title of a purchaser of a forfeited
           Security will not be affected by any irregularity or invalidity in
           the forfeiture, sale or other disposal of the Security.

3.6        CONSEQUENCES OF FORFEITURE: A person whose Securities have been
           forfeited will cease to be a holder in respect of those Securities
           and will surrender the certificate for those Securities (if any) for
           cancellation but will remain liable to the Company for all moneys due
           to the Company at the date of forfeiture in respect of the Securities
           together with interest thereon.

3.7        NOTICE TO HOLDER: On the forfeiture of any Securities, the Board must
           cause a note of the forfeiture and the date thereof to be entered in
           the Register and give notice of such forfeiture and the date thereof
           to the person in whose name the Securities stood immediately prior to
           the forfeiture. Upon the disposal of any forfeited Security the Board
           must cause a note of the manner and date of disposition to be
           similarly entered.

3.8        EVIDENCE OF FORFEITURE: A statutory declaration by a Director or any
           other person authorised by the Board that a Security has been
           forfeited on a specified date shall be conclusive evidence of that
           forfeiture.

3.9        RIGHT OF SET OFF: The Board may deduct from the dividends payable to
           any holder of Securities, all sums of money as may be due from that
           holder to the Company on account of calls, instalments upon the
           specific Securities in respect of which the dividend is declared, and
           on account of amounts that the Company may be called upon to pay
           under any statute or legislative enactment in respect of the
           Securities of a deceased or other holder.

                                                                              31
<PAGE>
ANNEXURE:  DEFINITIONS AND INTERPRETATION (CLAUSE 1.1)

1.         DEFINITIONS

           "ACT" means the Companies Act 1993;

           "AGGREGATE GROSS VALUE" means the gross value of the relevant assets
           calculated in accordance with the definition of "Gross Value of
           Assets";

           "ASSOCIATED PERSON" has the meaning given in the Listing Rules;

           "ASX" means the Australian Stock Exchange Limited;

           "ASX LISTING RULES" means the listing rules of the ASX and any other
           rules of the ASX which are applicable while the Company is admitted
           to the official list of the ASX, each as amended or replaced from
           time to time, except to the extent of any express written waiver
           granted by the ASX;

           "AVERAGE MARKET CAPITALISATION" means the average end of day market
           capitalisation over the Business Days in the calendar month before
           the earlier of the day the transaction is entered into or is
           announced to the market;

           "BOARD" means Directors who number not less than a quorum, acting
           together as the board of directors of the Company;

           "BUSINESS DAY" means a day on which the Exchange is open for trading;

           "CHAIRMAN" means a Director elected by the Board as such;

           "CLASS" means a class of Securities having identical rights,
           privileges, limitations and conditions and includes or excludes
           Securities which the Exchange deems to be of or not of that Class;

           "COMPANY" means Fletcher Challenge Forests Limited;

           "CONSTITUTION" means this constitution (including the schedules and
           annexure), as altered from time to time;

           "CONVERT" in respect of a Security, means to convert that Security
           into, or exchange that Security for, a Security of a different sort,
           whether at the option of the holder, or of the Company, or otherwise,
           or to subscribe for or obtain a Security of a different sort pursuant
           to a right conferred by the original Security; "CONVERSION" and
           "CONVERTIBLE" have corresponding meanings;

           "DEBT SECURITY" means a security having any interest in or right to
           be paid money that is, or is to be, deposited with, lent to, or
           otherwise owing by, any person (whether or not the interest or right
           is secured by a charge over any property) and includes a debenture,
           debenture stock, bond, note or certificate of deposit;

           "DIRECTOR" means a person appointed as a director of the Company;

                                                                              32
<PAGE>
           "DISTRIBUTION RIGHT" means a right of the nature referred to in
           paragraphs (a) or (b) of the definition of "Equity Security";

           "EMPLOYEE" includes an employee or officer of the Company or any of
           its subsidiaries, a labour-only contractor, consultant, or consultant
           company who or which contracts with the Company or any of its
           subsidiaries, any trustee or trustees on behalf of any of the above
           employees or officers, and any trustee or trustees of or in respect
           of any pension, superannuation or like fund established for the
           benefit of any of the above employees or officers;

           "EQUITY SECURITY" means a Security of the Company which:

           (a)        confers a present or future right to participate in the
                      assets of the Company after payment of all liabilities of
                      the Company, other than up to a fixed amount; or

           (b)        confers a present or future right to participate in the
                      income or profits of the Company, other than at a fixed
                      rate or at a rate fixed by reference to a formula or index
                      external to the Company; or

           (c)        carries, or will in the future carry, a vote at meetings
                      of Shareholders or a right to participate in the ultimate
                      control of the Company; or

           (d)        may be Converted into a Security of the nature referred to
                      in paragraphs (a) to (c) of this definition,

           and includes any other Security which the Exchange in its discretion
           deems to be an Equity Security;

           "EXCHANGE" means the New Zealand Stock Exchange or any successor
           thereto and, as the context permits, includes any delegate of the
           Exchange, including the Panel;

           "GROSS VALUE OF ASSETS" shall be calculated as the greater of the
           gross tangible asset backing (from the most recently published
           financial statements) or market value (in both cases irrespective of
           and ignoring any liabilities attributable to the assets or of any
           Subsidiaries or other entities through which the assets are held);

           "GROUP" means the Company and its subsidiaries;

           "LISTING RULES" means the listing rules of the Exchange which are in
           force, as altered or waived from time to time;

           "MATERIAL TRANSACTION" means a transaction whereby the Company:

           (a)        purchases or otherwise acquires, gains, leases (as lessor
                      or lessee) or sells or otherwise disposes of, assets
                      having an Aggregate Gross Value in excess of 5% of the
                      lesser of Shareholders' Funds or the Average Market
                      Capitalisation of the Company; or

           (b)        borrows, lends, pays or receives, money, or incurs an
                      obligation, of an amount in excess of 5% of the lesser of
                      Shareholders' Funds or the Average Market Capitalisation
                      of the Company; or

           (c)        enters into any guarantee, indemnity, or similar
                      obligation, or gives any security, for or of obligations
                      which could expose the Company to liability in excess of
                      5% of the lesser of Shareholders' Funds or the Average
                      Market Capitalisation of the Company; or

                                                                              33
<PAGE>
           (d)        provides or obtains any services (including without
                      limitation the underwriting of Securities or services as
                      an employee) in respect of which the actual gross cost to
                      the Company in any financial year (ignoring any returns or
                      benefits in connection with such services) is likely to
                      exceed an amount equal to 0.5% of the lesser of
                      Shareholders' Funds or the Average Market Capitalisation
                      of the Company; or

           (e)        amalgamates, except for amalgamations of a wholly owned
                      Subsidiary with another wholly owned Subsidiary or with
                      the Company;

           "MINIMUM HOLDING" means a parcel or number of Securities defined as
           such in the Listing Rules;

           "OFFICE" means the registered office of the Company;

           "OPTION" means an option to acquire a Security;

           "ORDINARY RESOLUTION" means a resolution passed by a simple majority
           of the votes of those Shareholders entitled to vote and voting on the
           resolution;

           "ORDINARY SHARE" means an ordinary share issued or to be issued by
           the Company, as the case may be;

           "PANEL" means the Market Surveillance Panel constituted by the
           Exchange under the Listing Rules and includes any division or duly
           authorised delegate of the Panel;

           "PERSONAL REPRESENTATIVE" means:

           (a)        in relation to a deceased individual Shareholder, the
                      executor, administrator or trustee of the estate of that
                      Shareholder;

           (b)        in relation to a bankrupt individual Shareholder, the
                      assignee in bankruptcy of that Shareholder; and

           (c)        in relation to any other individual Shareholder, a person
                      appointed or deemed to have been appointed to administer
                      property under the Protection of Personal and Property
                      Rights Act 1988, a manager appointed or deemed to have
                      been appointed thereunder, and a donee of an enduring
                      power of attorney complying with that Act;

           "PREFERENCE SHARE" means a preference share issued or to be issued by
           the Company, as the case may be;

           "QUOTATION" means, in respect of a Class of Securities, the right for
           sharebrokers to quote bids and offers for that Class of Securities on
           the Exchange; "QUOTE" and "QUOTED" have corresponding meanings;

           "RECOGNISED STOCK EXCHANGE" means a stock exchange approved by the
           Exchange from time to time as enforcing rules, procedures and
           requirements sufficiently analogous to those of the Exchange to
           justify classification as a Recognised Stock Exchange for the
           purposes of the Listing Rules;

           "REGISTER" means the register of Shareholders required to be kept
           pursuant to the Act and includes any branch register;

           "RELATED PARTY" means a person who is at the time of a Material
           Transaction, or was at any time within six months before a Material
           Transaction:

                                                                              34
<PAGE>
           (a)        a Director or officer of the Company or any of its
                      subsidiaries; or

           (b)        a substantial security holder (as defined in the
                      Securities Amendment Act 1988) of the Company; or

           (c)        an Associated Person of the Company or any of the persons
                      referred to in paragraphs (a) or (b) of this definition
                      other than a person who becomes an Associated Person as a
                      consequence of the Material Transaction itself (or an
                      intention or proposal to enter into the Material
                      Transaction itself); or

           (d)        a person in respect of whom there are arrangements other
                      than the Material Transaction itself, intended to result
                      in that person becoming a person described in paragraphs
                      (a), (b) or (c) of this definition, or of whom the
                      attainment of such a status may reasonably be expected,
                      other than as a consequence of the Material Transaction
                      itself,

           but excludes a wholly owned subsidiary of the Company other than a
           wholly owned subsidiary which:

                      (i)        is a party to a Material Transaction of the
                                 type described in paragraph (d) of the
                                 definition of "Material Transaction"; and

                      (ii)       the Company intends to sell, or otherwise
                                 dispose of, the subsidiary to a Related Party;

           "RENOUNCEABLE" means, in relation to a Right or offer of Securities,
           a Right or offer that is transferable by any holder for the time
           being to another person (whether or not an existing holder of any
           Securities to which the Right or offer relates);

           "REPRESENTATIVE" means a person appointed as a proxy or
           representative or a Personal Representative;

           "RIGHT" means any right to acquire any Security or benefit of any
           kind, whether conditional or not, and whether Renounceable or not;

           "RULING" means any decision or determination given by the Exchange or
           the Panel as to the meaning and interpretation of the Listing Rules
           and includes any ruling, waiver, or revocation of waiver, given
           pursuant to Listing Rules 1.4, 1.6 or 1.7;

           "SECURITY" means any interest or right to participate in any capital,
           assets, earnings, royalties or other property of the Company and
           includes:

           (a)        any renewal or variation of the terms or conditions of any
                      existing security;

           (b)        any Debt Security of the Company; and

           (c)        any Option or Right;

           "SHARE" means an Ordinary Share or a Preference Share as the case may
           be;

           "SHAREHOLDER" or "HOLDER" means a person whose name is entered in the
           Register or any other register as the holder for the time being of,
           in the case of a "SHAREHOLDER", one or more Shares of the Company or,
           in the case of a "HOLDER", one or more Securities;

                                                                              35
<PAGE>
           "SHAREHOLDERS' FUNDS" means the amount disclosed as equity (whether
           described as equity, shareholders' funds, or otherwise) by the most
           recent published Group financial statements of the Company and its
           subsidiaries, provided that if at any time at which shareholders'
           funds of the Company is required to be determined:

           (a)        the Company has not published financial statements; or

           (b)        since the date of the most recent published statements
                      there has been a material decline in the equity of the
                      Company or, if the Company has subsidiaries, of the
                      consolidated equity of the Company and its subsidiaries,

           then the shareholders' funds of the Company at that time will be
           determined by reference to the position which would be disclosed if
           financial statements were prepared at that time;

           "SPECIAL RESOLUTION" means a resolution passed by a majority of 75%
           or more of the votes of those Shareholders entitled to vote and
           voting on the resolution;

           "SUBSIDIARY" means:

           (a)        a subsidiary within the meaning of section 5 of the Act
                      (read together with sections 6 to 8 of the Act); and

           (b)        an entity treated as a subsidiary or in substance
                      subsidiary within the meaning of the Statement of Standard
                      Accounting Practice Number 8 issued by the New Zealand
                      Society of Accountants as amended from time to time or
                      within the meaning of any financial reporting standard
                      approved in terms of section 27(3) of the Financial
                      Reporting Act 1993; and

           "TREASURY STOCK" means Shares of the Company which have been acquired
           by the Company and are held by the Company as treasury stock pursuant
           to provisions of the Act which enable treasury stock to be held by
           the Company and includes Shares falling within section 82 of the Act.

2.         INTERPRETATION

2.1        Headings appear as a matter of convenience and shall not affect the
           construction of this Constitution.

2.2        In the absence of any express indication to the contrary, references
           to clauses and paragraphs are to clauses and paragraphs of this
           Constitution including, as appropriate, the schedules to this
           Constitution.

2.3        Reference to any statute or statutory regulations is a reference to
           the statute or statutory regulations as amended or substituted.

2.4        References to a Listing Rule includes that Listing Rule as amended or
           substituted.

2.5        References to the rights attached to a Share or Security include the
           rights, privileges, limitations and conditions attached to the Share
           or Security by the Act or this Constitution.

2.6        Unless otherwise defined, words or expressions defined in the Act or
           the Listing Rules have the same meaning in this Constitution.

                                                                              36
<PAGE>
2.7        The singular includes the plural and vice versa.


2.8        The words "written" and "writing" include facsimile communications
           and any other means of communication resulting in permanent visible
           reproduction.

2.9        The word "person" includes any association of persons whether
           corporate or unincorporate, and any state or government or department
           or agency thereof, whether or not having separate legal personality.

                                                                              37