Common Questions

Below are all the common questions from all pages in a single page. The sub-heading is the title of the page where the FAQ is from.

Dividend Restrictions

Will dry shareholders be forced to sell their shares under the amended Constitution?

No. The amended regulations do not permit a requirement that dry shareholders sell their shares.

Why is the grandfathering rule of seven years before a current dry shareholder loses dividends so long?

This is a concession made at the time of the KISP consultation process. The seven years provides a substantial period of time for dry shareholders to continue receiving dividends before the measure takes effect.

Why isn’t Zespri proposing a dividend cap on producers who exceed the four-to-one share cap?

KISP proposed a dividend cap for all shareholders, however the new Kiwifruit Export Regulations allow a dividend cap to be introduced for non-producers only. Regardless, the requirement on producers to sell shares over the four-to-one cap means that dividends on the over-shared portion cease anyway after the transition period of seven or three years has passed.

Share Cap

How will Zespri enforce the four-to-one share cap rule?

Under the amended Constitution, the Board is entitled to sell the over-shared portion of the shares on the producer’s behalf, if the producer does not sell them within the required period.

How will Zespri decide on a price for the shares it sells on behalf of the overshared producer?

The shares would be sold at the best price that is reasonably obtainable at the time of the sale.

Will undershared growers be required to purchase Zespri shares?

No, undershared growers won’t be compelled. However, we hope to make it easier for growers who are either undershared or own no shares to become shareholders. A future targeted share buyback and issue programme is intended as part of this process.

How does the rule deal with dry shareholders (non-producers) who get back into production i.e they buy or lease an orchard?

A dry shareholder who later becomes a producer again will have to sell their over-shared shares if they are above the four-to-one cap within a three year time period of becoming a producer.

Voting Cap

How does the proposed entitlement differ from current voting?

Currently voting entitlements are worked out by calculating a shareholder’s production as a proportion of total industry production and total shares on issue. However, if the resulting number is greater than the number of shares held by the shareholder, then the voting entitlement will be the number of shares held. The future voting entitlement will not be dependent on the proportion of a shareholder’s production to the total industry production, but just based on their own production. A ratio of one voting share per tray produced voting entitlement applies, unless the shareholder holds a lesser number of shares, in which case the lesser number of shares can be voted.

Entitlements of Owners and Lessees of KPINS

Why is it necessary to have absolute alignment between the registered owners of shares and the registered owners of orchards?

This simplifies Zespri’s rules. The alternative would require very detailed and complex rules to be developed to define ‘common ownership’ of related entities, and the consequences of common ownership for calculating the position of each shareholder under the new rules.

How can I transfer shares if I have lost my share certificate?

You will need to complete a ‘Statutory Declaration and Indemnity for Lost Certificates’ form which is available from Computershare or Zespri. Essentially, this declaration confirms that the certificate has been lost or misplaced and allows Computershare to cancel the certificate in their records. The form needs to be signed by all joint holders and witnessed by a solicitor, a Justice of the Peace, or a Notary and returned to Computershare. A $25.00 fee is payable directly to Computershare.

Interest Groups and the voting process

Why are producers and non-producers recognised as interest groups?

The key reason is that the Regulations specifically recognise and treat differently producers and non-producers. Zespri can impose a share cap and voting changes for producers only, and can impose a dividend cap on non-producers only.

Does Zespri have a reasonable expectation that non-producers will vote on a Constitution that removes their dividends?

Zespri is recommending this measure because it is the right thing to do, within the scope of the Kiwifruit Export Regulations, to promote greater alignment between production and shareholding. We hope non-producers will support it.

Why should non-producers be entitled to vote on a measure to remove dividends from producers who might become dry in future?

Under the Companies Act, an interest group vote by current members of an interest group will affect existing and future members of the interest group. The position is the same for producers: current producers will vote on changes that will also affect future producers. The Board has decided to also offer the vote on removal of dividends to producers.

What consequences are there for an interest group member if they vote all of their shares against the proposal but over 75 percent of the interest group that votes supports the proposal and so it passes?

If this scenario eventuates, then those members of the interest group who voted all of their shares against the proposal have a minority buy-out right, which means the right to have Zespri buy back their shares. This would be at a fair and reasonable price approved by the Board, which will obtain and take into account an independent valuation when setting the price.

The Landowner Priority Rule

Why should lessees have rights to shares?

Growers who lease land to produce kiwifruit have an important stake in the industry and, through the KISP consultation process, it was recognised that lessees should have a right to take up shares available under the cap but subsidiary to the rights of the landowner.

I am a grower who leases an orchard from another landowner. The historical production of the orchard is 10,000 trays. The landowner of the orchard is not a shareholder. Can I purchase shares?

Due to the landowner not being a shareholder, you are entitled to the full share entitlement for this orchard, being 40,000 shares (4 x 10,000 trays).

You will be able to vote up to 10,000 shares if you buy them. How will a lessee know what shares are available within the cap?

Lessees can contact Zespri at any time to ascertain the headroom available to them. This information will also be available on the Industry Portal website in the future.

How are shares allocated across orchards to identify ‘headroom’ at each KPIN for the lessee to use?

Zespri’s share system will have a method of allocating share entitlement by default, first to the KPINs that a producer owns and any balance to those KPINs that the producer leases (if there is room available under the share cap for that KPIN once the landowner’s holding has been taken into account).

How are my shares allocated if I own more than one property?

Shares are allocated to each property in proportion to the production attributed to that property.

Whilst Zespri has endeavoured to ensure that the information provided in these documents is accurate, the proposals for amendments to Zespri's constitution are still in the process of being finalised, and therefore may be subject to change. Zespri shall not be directly or indirectly liable (whether in contract, tort or otherwise) to any person for any statement, representation, misrepresentation inaccuracy, omission or otherwise in respect of, or any reliance by any person on, any information or documentation Zespri or any of its representatives directly or indirectly makes available or otherwise discloses (whether orally or in writing) in this document or in relation to this document. Updates to the proposals will be made available here on the website and the final proposals will be contained in the proposed constitution issued for voting purposes prior to the Special Meeting.