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	COMPLIANCE OPTIONS The exceptions to the fundamental rule are a range of compliance options. They are: Full and partial offers. Acquisition or allotment of voting securities with the approval of an ordinary resolution of shareholders of the Code company. A 5% creep option for a person that already holds or controls more than 50% of the votes. Compulsory purchase provisions which are triggered at the 90% threshold. The Code does not apply below the 20% threshold. FULL OFFER A full offer is an offer for all the voting securities in the target company. It must extend to all equity securities whether voting or non-voting. PARTIAL OFFER A partial offer is an offer to all the holders of voting securities for a specified percentage of the voting securities in the target company. The offer is not required to include other equity securities. Shareholders may sell all or part of their holdings but there are scaling provisions in the Code based on the specified percentage if there are excess acceptances. The partial offer must be for sufficient voting rights to take the offeror’s holding over 50%of the voting rights in the target company unless shareholders approve a lesser percentage. The approval process forms part of the offer procedure. The lesser percentage must be approved by shareholders who hold more voting rights in the target company than shareholders that object to the lesser percentage. For this purpose voting rights held by the bidder and its associates are disregarded. PROVISIONS RELATING TO OFFERS MINIMUM ACCEPTANCE CONDITION Where the bidder does not hold or control more than 50% of the voting rights the offer must be conditional on the bidder receiving sufficient acceptances to gain control of more than 50% of the voting rights in the target company. The only qualification to this rule is in the case of a partial offer for less than 50% which has been approved by shareholders. EQUAL TREATMENT OF SHAREHOLDERS With both full and partial offers the same terms, including price, must be offered to all security holders within a class of securities. Where there are different classes of securities an independent adviser must certify that the price is fair and reasonable as between classes. PRICE There is no restriction on the price that may be offered except that the price must be fair and reasonable between different classes of securities.		CONTRACTUAL DOCUMENT The offer is still a contractual document. The offeror is free to establish the terms and conditions in accordance with normal contractual principles but within the framework of the Code. The Code does not set out a fixed formula to apply to all offers. It may be necessary to express the offer and its terms and conditions in a particular manner so as to obtain the full benefit of the flexibility which the Code permits. OFFER PROCEDURE The Code sets out a procedure for takeover offers. This is based on the existing procedures under the Companies Amendment Act 1963 which is being repealed. The offeror and the target company are required to disclose a range of information which is more extensive than was required under the Companies Amendment Act 1963. In addition, the directors of the target company must obtain a report from an independent adviser on the merits of an offer. The target company directors must also recommend whether the offer should be accepted or rejected or, if they are unable or unwilling to make that recommendation, provide a statement to that effect and the reasons. DEALINGS DURING THE OFFER PERIOD There are certain restrictions on the offeror during the course of a takeover offer. The offeror cannot dispose of equity securities in the target company. The only qualification is that it may dispose of equity securities under another offer made under the Code. This is to cover the position where an auction develops between competing bidders. The offeror can acquire shares outside of the offer procedure where the offer is for cash,or provides a cash alternative. The possibility of acquisitions must be included in the offeror’s statement and the number of securities bought must not result in the offeror breaching the 20% threshold if the offer is unsuccessful. DEFENSIVE TACTICS Defensive tactics by the directors to frustrate the offer or prevent the shareholders from having the opportunity to consider the offer are not permitted.However this does not prevent directors from taking steps to encourage competing bona fide offers from other parties,and does not prevent actions which: have been approved by an ordinary resolution of the target company; are taken or permitted under a contractual obligation or in the implementation of proposals approved by the directors of the target company (the contract must have been entered into or the proposals approved before a takeover notice was received or the target company became aware that an offer was imminent); or are taken or permitted for reasons unrelated to the offer with the prior approval of the Takeovers Panel.

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