1. Quota offer requirement

FLC must, in each Relevant Year:

1. offer to at least five Fishers in aggregate an amount of CRA 4 Quota that is no less than 10% of the aggregate amount of CRA 4 Quota acquired by FLC during that Relevant Year;
2. offer to at least five Fishers in aggregate an amount of CRA 8 Quota that is no less than 10% of the aggregate amount of CRA 8 Quota acquired by FLC during that Relevant Year;
3. offer in aggregate an amount of Quota that is no less than 10% of the aggregate amount of Quota acquired by FLC in all quota management areas during that Relevant Year,

provided that:

4. the requirement in paragraph (a) shall only apply where FLC has acquired at least 50,000 quota shares in CRA 4 (Wellington/Hawke’s Bay) during that Relevant Year;
5. the requirement in paragraph (b) shall only apply where FLC has acquired at least 50,000 quota shares in CRA 8 (Southern) during that Relevant Year; and
6. any such offer of Quota:
1. must be made at a price per quota share no greater than the price paid by FLC for the quota share that FLC is offering for sale; and
2. may be on any other terms or conditions determined by FLC (acting reasonably), which, for the avoidance of doubt, may include any terms or conditions which FLC has applied to an offer of Quota by FLC to a Fisher prior to the date the Consent is granted.

This condition shall be deemed to be satisfied for each Relevant Year on receipt by the Director-General of a Statutory Declaration (Quota Offers) which has been completed in accordance with its terms and which shall certify that the quota offer conditions of the Consent have been met, to be received by the Director-General no later than 30 days after the final day of the Relevant Year in question.

2. ACE Support

FLC must, in each Relevant Year, provide ACE Support in relation to at least 50% of Total ACE acquired in each Area during the Relevant Year.

This condition shall be deemed to be satisfied for each Relevant Year on receipt by the Director-General of a Statutory Declaration (ACE Support) which has been completed in accordance with its terms and which shall certify that the ACE Support condition of the Consent has been met, to be received by the Director-General no later than 30 days after the final day of the Relevant Year in question.

3. Reporting

FLC must provide the following information to the Director-General no later than 30 days after the final day of each Relevant Year:

1. a Statutory Declaration (Quota Offers) which has been completed in accordance with its terms and which shall certify that the quota offer conditions of the Consent have been met;
2. a Statutory Declaration (ACE Support) which has been completed in accordance with its terms and which shall certify that the ACE Support condition of the Consent has been met; and
3. the following details in relation to each completed acquisition of Quota in any of the Areas during the Relevant Year:
1. the name of the vendor;
2. the amount of Quota acquired;
3. the quota management area to which the Quota relates; and
4. the date of the acquisition,

together, the Annual Report.

Application of conditions

1. If the Consent conditions are satisfied for each of the first four Relevant Years, then the conditions shall cease to apply, and the Consent shall be unconditional, on and from the date that the Consent conditions for the fourth Relevant Year are satisfied.
2. If FLC provides the Director-General with notice of an acquisition by FLC of Quota in any of the Areas as part of its properly completed Annual Report (Notified Acquisition) the Quota acquired in respect of the Notified Acquisition shall no longer be subject to the Consent conditions.

ACE

Means annual catch entitlement (in kilograms) for Lobster.

ACE Support

Means either:

1. a loan advanced by FLC to a Fisher to assist the Fisher to acquire ACE from a person other than FLC, where that loan is:
1. for the full value of the ACE being acquired by the Fisher in the particular acquisition of ACE to which the loan relates;
2. interest free for at least nine months from the date the loan is advanced by FLC to the Fisher; and
3. otherwise on any other terms or conditions determined by FLC (acting reasonably) which, for the avoidance of doubt, may include any terms or conditions which FLC has applied to a similar loan made by FLC to a Fisher prior to the date the Consent is granted; or
2. a sale of ACE by FLC to a Fisher, where that sale of ACE is conducted on the following terms:
1. the Fisher is not required to pay for the ACE which is the subject of the sale until Lobster caught by the Fisher under that ACE is sold to FLC; and
2. the unpaid purchase price does not accrue any interest for a period of at least:
1. nine months following the date the ACE is transferred to the Fisher; or
2. the date the ACE is transferred to the Fisher to the date the Fisher pays for the ACE which is the subject of the sale, whichever is the shorter; and
3. otherwise on any other terms or conditions determined by FLC (acting reasonably), which, for the avoidance of doubt, may include any terms or conditions which FLC has applied to a similar sale of ACE from FLC to a Fisher prior to the date the Consent is granted.

Areas

Means the following quota management areas:

1. CRA 4 (Wellington/Hawke’s Bay);
2. CRA 7 (Otago); and
3. CRA 8 (Southern).

Consent

Means the consent for FLC to acquire up to 15,000,000 Lobster quota shares in each of quota management areas CRA 4 (Wellington/Hawke’s Bay), CRA 7 (Otago) and CRA 8 (Southern) granted by the Minister for Primary Industries pursuant to section 60(1) of the Fisheries Act 1996.

CRA 4 Quota

Means individual transferrable quota for Lobster in quota management area CRA 4 (Wellington/Hawke’s Bay).

CRA 8 Quota

Means individual transferrable quota for Lobster in quota management area CRA 8 (Southern).

Director-General

Means the Director-General of the Ministry for Primary Industries.

Fisher

Means any person involved in the catching, taking, or harvesting of Lobster, or any Representative of such a person.

FLC

Fiordland Lobster Company Limited and its subsidiaries.

Lobster

Spiny rock lobster.

Quota

Means individual transferrable quota for Lobster.

Relevant Year

Means the period starting on 1 April and running to 31 March in the following year, with the first Relevant Year being the period running from 1 April 2017 to 31 March 2018.

Representative

Means any person who holds Quota or ACE on behalf of a Fisher, or for the purposes of enabling a Fisher to utilise the benefit of that Quota or ACE (whether as a trustee, nominee or otherwise).

Statutory
Declaration
(ACE Support)

Means a statutory declaration in relation to FLC’s compliance with condition two of the Consent, in the prescribed form.

Statutory
Declaration
(Quota Offers)

Means a statutory declaration in relation to FLC’s compliance with condition one of the Consent, in the prescribed form.

Total ACE

Means, in respect of an Area, the aggregate of:

1. ACE in that Area that FLC acquires during the Relevant Year; and
2. ACE in that Area that a Fisher acquires during the Relevant Year using ACE Support (other than ACE acquired by a Fisher from FLC).