New Zealand Legislation: Regulations

14 Conditions of exemption in clause 11 relating to section 37A(1)(b) of Act where no election to convert available

• (1) This clause applies if the holder of a convertible security referred to in clause 11(1A)(b) does not have a right to elect to convert that security.

  (2) If this clause applies, the exemption in clause 11 from section 37A(1)(b) of the Act is subject to the condition that the investment statement relating to both the convertible securities and the new securities includes the following:

  • (a) a statement to the effect that changes of circumstance occurring between the date of the allotment of the convertible securities and the conversion date of those securities may have a material effect on the new securities (including their price) or the issuer:

  • (b) a statement that important information relating to the securities (including their price) and the issuer will be disclosed in accordance with the continuous disclosure provisions of the listing rules of each specified securities market on which the convertible security is quoted:

  • (c) a statement describing the principal risks assumed by holders of the convertible securities:

  • (d) a statement to the effect that holders of the securities have no right to elect to convert:

  • (e) a statement that new securities will or may be alloted (as the case may be) even if, at the time of allotment, there are adverse circumstances that make the investment statement false or misleading in a material particular by reason of failing to refer, or give proper emphasis to, those circumstances.

  Clause 14: added, on 21 December 2007, by clause 8 of the Securities Act (Rights, Options, and Convertible Securities) Exemption Amendment Notice (No 2) 2007 (SR 2007/405).