NEW ZEALAND GAZETTE, No. 144

30 SEPTEMBER 2009

4.3

A Disclosure Statement is required to meet the following criteria:

(a) The valuation of each horse must be specified as well as the total of the valuations.

(b) All required information and valuation and veterinary certificates must be provided and in order and the Disclosure Document must be signed by the Syndicate Promoter.

(c) The Board must be satisfied that there is no reason to suspect that any of the information provided is incorrect.

(d) A certificate on form COP 7 must be attached declaring that no person(s) associated with the syndication or offer has/have changed their status in terms of the criteria for approval of Syndicate Promoters materially altered since approval was granted and/or the last syndication or offer by the Syndicate Promoter.

(e) The Board must be satisfied that the Syndicate Promoter’s performance in prior syndications or offers has been satisfactory.

(f) The Board must be satisfied that the charges, margins or disparities from valuation are not such that they may, in its opinion, bring the industry into disrepute.

(g) The directive to the Bank in respect of the Syndicate or Bloodstock Company’s account must be provided.

If a Disclosure Statement is not approved by the Board, it may be amended and resubmitted to the Chief Executive.

4.4

A Disclosure Statement must be signed by the Syndicate Promoter and where it is a corporate entity by all the directors thereof.

5 ADVERTISING

5.1

Advertisements shall not be misleading or factually incorrect or be likely to bring the thoroughbred industry into disrepute and shall otherwise comply with the requirements of the Securities Act 1978 and the Securities Regulations 1983.

5.2

A copy of each proposed advertisement in respect of a particular syndication or offer must be delivered to the Chief Executive 14 days prior to its intended first publication.

5.3

Each proposed advertisement must state clearly and prominently that applications for units or shares in the Syndicate or Bloodstock Company can only be made after an investor has received and signed a Disclosure Statement. In addition, each advertisement must state the name of the Manager of the Syndicate or the Directors of the Bloodstock Company, the name of the Syndicate Promoter, and the name of the auditor.

5.4

The proposed advertisement must be accompanied by an Authority to Publish/Broadcast Advertisement (form COP 8) completed as to part 1. Thoroughbred Racing will complete part 2 and issue the certificate to the Syndicate Promoter on approval of the content of the advertisement.

5.5

Disclosure of Authorised Syndicator status must be made in accordance with clause 3 of this Code of Practice.

5.6

No proposed advertisement shall be published until its publication has been authorised in writing by the Chief Executive.

5.7

The Syndicate promoter must provide a copy of the completed Authority to Publish/Broadcast to each publisher of the advertisement.

6 BANK ACCOUNT

6.1

A Syndicate Promoter must establish a separate bank account for each Syndicate or Bloodstock Company. All moneys received by the Syndicate Promoter from investors in a Syndicate or Bloodstock Company must immediately be deposited into that separate bank account by the Syndicate Promoter. If no interest is to be paid to investors in the event that investments are refunded that fact must be disclosed in the advertisement.

6.2

Each Syndicate Promoter must issue in favour of Thoroughbred Racing an irrevocable written direction in the form prescribed by Thoroughbred Racing (form COP 6) to the trading bank at which the Syndicate or Bloodstock Company’s bank account is maintained to the effect that moneys held in the Syndicate or Bloodstock Company’s bank account being moneys held on behalf of investors will be either:

(a) "Frozen" if directed by the Chief Executive.