4288 No. 178

NEW ZEALAND GAZETTE

shall be returned to the Grantor in accordance with clause 4.13 (b).

(e) Where the Forestry Right is transferred by the Grantee to Regional Forests Limited or any other assignee for consideration negotiated at arms length, Regional Forests Limited or that assignee shall be compensated for:

(i) diminution in expected value of this Forestry Right arising from the exclusion of land from replanting pursuant to clause 4.14 (c) (ii) if that transfer occurs before the areas to be excluded from replanting have been determined; and

(ii) Management Costs incurred by Regional Forests Limited or that assignee in respect of the areas excluded from replanting pursuant to clause 4.14 (c) (ii) except to the extent that the:

(aa) Management Costs relate to the growing, tending and harvesting of the existing crop of commercial trees; or

(bb) intended benefits of the expenditure of those Management Costs, remain available to the Grantee.

(f) If the consideration to be paid for the transfer of the Forestry Right from the Grantee to Regional Forests Limited has not been negotiated and agreed at arms length then to the extent that full market consideration has not been paid or deemed not to be paid, the compensation otherwise payable will be reduced to pro rata. In the event of a dispute as to whether or not the consideration has been negotiated and agreed at arms length, the dispute shall be determined by the Audit Office and its decision shall be final and binding on the parties.

(g) Where the Grantee has incurred Management Costs in respect of any area of the Hunua Forest excluded from replanting under clause 4.14 (c) (ii), then the Grantee shall not be compensated for diminution in expected value of this Forestry Right but shall be compensated for those Management Costs except to the extent that the:

(i) Management Costs relate to the growing, tending and harvesting of the existing crop of commercial trees; or

(ii) intended benefits of the expenditure of those Management Costs remain available to the Grantee.

(h) Notwithstanding the provisions of paragraph (b) above, the Grantor and the Grantee agree:

(i) to use their best endeavours to establish the Replanting Committee as soon as possible following the date of the signing of this Agreement; and

(ii) to use their best endeavours to encourage and assist the Replanting Committee to give an urgent determination of the matters the Replanting Committee are required to determine under this clause 14.4 so that the area to be excluded from replanting will be known as soon as reasonably possible.

(i) "Management Costs" means for the purpose of clause 4.14, all costs incurred by the Grantee in connection with the management of the Hunua Forest including any monies payable pursuant to this Forestry Right, other reasonable outgoings, interest and reasonable overheads.

(j) For the purpose of identifying the proportion of Management Costs to be compensated to the Grantee pursuant to clause 4.14 (e) and (g), the areas excluded shall be expressed as a percentage of the total area in respect of which the costs were expended or incurred.

4.15 Exclusion of Additional Service Land.

The Grantee acknowledges that the Grantor is required to comply with the provisions of clause 9.1 of the Lease (the provisions of which are set out in the Fifth Schedule) pursuant to which the Grantor may be required to extend the Service Land. The Grantor will consult with the Grantee upon receiving any such request from the said Lessee.

5. Assignment

5.1 In the event that the Grantee wishes to assign or transfer this Forestry Right in whole or wishes to part with its rights under this Forestry Right, then it shall not do so without first obtaining the Grantor’s prior written consent of the Grantor which shall not be unreasonably or arbitrarily withheld where the conditions listed in clause 5.2 have been satisfied.

5.2 The conditions referred to in clause 5.1 are as follows:

(a) The proposed assignment or transfer relates to all the Grantee’s rights and obligations under this Forestry Right and not to any part or parts thereof less than the whole;

(b) The Grantee is not at the time of application for such consent or thereafter before consent is granted in default in the due and punctual observance or performance of the covenants and conditions on the Grantee’s part herein contained;

(c) The Grantee pays to the Grantor all costs incurred by the Grantor (whether or not the proposed assignment or transfer proceeds to completion) including the Grantor’s administrative and other expenses and legal costs of and incidental to the application for consent;

(d) The Grantee procures the execution by the assignee of a covenant with the Grantor that the assignee will at all times during the continuance of the term of this Forestry Right duly pay the forestry licence fee at the times and in the manner herein provided and observe and perform all the covenants and conditions herein contained on the part of the Grantee to be observed and performed and such covenants shall make provision for a like covenant in the event of any subsequent transfer or assignment;

(e) The Grantee and the assignee comply with the Grantor’s requirements in relation to the documentation, stamping and registration of the intended assignment or transfer, such documentation, stamping and registration to be at the cost in all respects of the Grantee;

(f) The Grantee procures in favour of the Grantor such guarantees as may be reasonably required by the Grantor in a form acceptable to the Grantor under the obligations and covenants of the assignee under the assignment or transfer and the costs of preparation and execution of such guarantee shall be paid by the Grantee;

(g) The Grantee provides to the assignee a copy of the Watercare Lease.

5.3 Notwithstanding anything herein contained or implied or any rule of law to the contrary, the obligation of an existing Grantee to pay the forestry licence fee and observe and perform the other covenants and conditions on