WAV/RULE: TWR: Application for waiver from NZSX Listing Rule 7.11.1

21 Jun 2010 10:07 am

TWR 21/06/2010 WAV/RULE

REL: 1007 HRS Tower Limited

WAV/RULE: TWR: Application for waiver from NZSX Listing Rule 7.11.1

27 May 2010 NZX Regulation Decision Tower Limited (TWR) Application for Waiver from NZSX Listing Rule 7.11.1

Background 1. Tower Limited ("TWR") is a listed Issuer with ordinary shares ("Shares") quoted on the NZSX market.

2. TWR has in place a dividend reinvestment plan ("DRP"). Under the terms of the DRP:

a. Applications to participate in the DRP are required to be submitted by the Record Date for the relevant dividend. The Record Date under the DRP means 5.00pm on the date fixed by the Board of TWR for determining entitlement to the dividend. b. The price at which shares will be issued under the DRP is based on the weighted average sale price of TWR shares sold on the New Zealand Stock Exchange on each of the first 5 business days immediately following the Record Date (which price may be adjusted at the discretion of the Board of TWR). If there are no sales in that period, then the price will be deemed to be the first sale price after the expiry of that period. c. On the day a shareholder that participates in the DRP would otherwise have been paid a cash dividend, TWR makes shares available to that participant in lieu of the dividend.

3. NZSX Listing Rule 7.11.1 requires that an Issuer making an issue shall proceed to allotment within five Business Days after the latest date on which applications for Securities close.

4. As applications to participate in the DRP will close on the Record Date for each dividend to which the DRP will apply, and the issue price is to be calculated over the 5 Business Days following the Record Date, the issue of Shares under the DRP will be in breach of Rule 7.11.1.

Application 5. TWR has approached NZX Market Supervision ("NZXMS") seeking a waiver from the requirement of Rule 7.11.1 to proceed with an allotment of securities within 5 business days after the Record Date in respect to shares issued under the DRP. In support of its application, TWR submits the following: a. No shareholder would be prejudiced by the delay in the issue of the shares if the waiver is granted, as they would not receive their entitlement to the cash dividend any earlier if they choose not to participate in the DRP. The rules of the DRP require that any issue of shares pursuant to the DRP is made on the same day that cash dividends are paid to shareholders who do not elect to participate in the DRP. b. If the waiver sought is not granted, the proposed DRP could not operate in accordance with its rules. The price for the shares to be issued under the proposed DRP is set based on the trading price of TWR shares for a specified trading period after the relevant Record Date which is the same as, or later than, that in Listing Rule 7.11.1. The method of price determination is fair and in line with market practice, and the waiver sought is necessary to enable practicable application of that method. c. There are a number of precedents for the waiver sought from Listing Rule 7.11.1. Rule

6. Rule 7.11.1 provides: An Issuer making an issue shall proceed to allotment within five Business Days after the latest date on which applications for Securities close.

Decision

7. On the basis that the information provided to NZXMS is full and accurate in all material respects, NZXMS grants TWR a waiver form Rule 7.11.1 with respect to TWR Shares to be allotted under the DRP on the following conditions: a. That TWR allots shares pursuant to the DRP on the same day that dividends are paid to shareholders who do not elect to participate in the DRP; and b. That if the DRP does not proceed to allotment, and money is returned to subscribers, TWR will refund any such monies to those who have elected to participate in the DRP at the same time as shareholders who do not elect to participate in the DRP. Reasons

8. In coming to the decision to grant TWR the waiver sought in respect of Rule 7.11.1, NZXMS has considered that: a. Unlike an IPO, the allotment of Shares in respect of the DRP is not linked to the closing of the offer. b. The conditions imposed are to give effect to NZX's policy of ensuring that subscribers have the benefit of their investment without inappropriate delays. The condition imposed in paragraphs 7(a) and 7(b) will ensure that all TWR shareholders will receive distributions at the same time, irrespective of whether they participate in the DRP or not. Accordingly, no shareholders will be prejudiced by the granting of this waiver. c. There is precedent for this decision. Publication

9. TWR has requested that the waiver application, and the decision in respect of the application, remain confidential until such time as TWR makes an announcement in respect of its DRP.

10. Pursuant to footnote 1 to Rule 1.11.2, NZXMS grants TWR's application that the decision remain confidential until TWR announces the terms of its DRP.

ENDS. End CA:00196307 For:TWR Type:WAV/RULE Time:2010-06-21:10:07:09

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