MEL – Waiver from NZX Listing Rule 5.2.1

NZ RegCo

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6 November 2025
NZ RegCo Decision
Meridian Energy Limited (NS) (MEL)
Application for waiver from NZX Listing Rule 5.2.1

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Background
1. The information on which this decision is based is set out in Appendix One to this decision. This
waiver will not apply if that information is not, or ceases to be, full and accurate in all material
respects.
2. The NZX Listing Rules (Rules) to which this decision relate are set out in Appendix Two.
3. Capitalised terms that are not defined in this decision have the meanings given to them in the
Rules.
Waiver from Listing Rule 5.2.1
Decision
4. Subject to the conditions set out in paragraph 5 below, and on the basis that the information
provided by MEL is complete and accurate in all material respects, NZ RegCo grants MEL a
waiver from Rule 5.2.1 to the extent that this Rule requires that the Arrangements be approved by
Ordinary Resolution of MEL’s shareholders.
5. The waiver in paragraph 4 above is provided on the conditions that:
a. the Directors of MEL certify that the Arrangements have been entered into, and have been
negotiated, on an arm’s length commercial basis;
b. the Directors of MEL certify that it was not influenced to enter into the Arrangements by
either the Crown, MCY or GNE;
c. the Directors of MEL certify that the granting of the waiver in respect of the Arrangements is
in the best interests of:
i) MEL; and
ii) all of MEL’s shareholders other than the Crown;
d. the Directors of MEL certify that the Arrangements are in the best interests of:
i) MEL;
ii) all of MEL’s shareholders; and
iii) all of MEL’s shareholders other than the Crown;
e. the Directors of MEL include in the relevant certificate a summary of the core grounds for
the certification given under each limb of conditions (a), (b), (c) and (d) described above;
and
f. the waiver, its conditions and implications being disclosed in MEL’s next annual report.

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Reasons
6. In coming to the decision to provide the waiver set out in paragraph 4 above, NZ RegCo has
considered that:
a. The purpose of Rule 5.2.1 is to ensure that shareholders have an opportunity to consider,
and vote on, Material Transactions where there is, or may be a perception of, the potential
for undue influence by a Related Party on an Issuer's decision to enter into a transaction or
agree to its terms. An applicant for a waiver from Rule 5.2.1 must establish that the granting
of any waiver is in the best interests of the Issuer, and the shareholders who are not
precluded from voting under Rule 6.3 (being the Related Party and its Associated Persons).
The NZX Guidance Note on Major and Related Party Transactions (Guidance Note)
outlines that NZ RegCo may waive the requirement to obtain shareholder approval of a
Material Transaction with a Related Party if it is satisfied that the personal connections with,
or involvement or personal interest of, any Related Party are immaterial or have not
influenced the promotion of, or the decision to enter into, the transaction or its terms and
conditions.
b. The granting of this waiver will not offend the policy behind Rule 5.2.1 and satisfies the
matters set out in the NZX Guidance Note because MEL has submitted, and NZ RegCo has
no reason not to accept, that:
i) The only reason that the Companies are Related Parties of each other is due to the
Crown owning more than half of the ordinary shares of each Company. Section 45R
of the Public Finance Act 1989 restricts any reduction of the Crown’s holding below a
51% control threshold.
ii) While the Crown is the majority shareholder in each of the Companies, it is not
involved in any of the Companies’ business operations.
iii) While the Crown does vote its shares to approve the appointment of directors of
each Company, it does not select and appoint directors to the Board of any
Company.
iv) The Crown itself has had no involvement in the development or negotiation of the
Arrangements, nor is it a party to them.
v) Each Company is separately listed on the NZX Main Board and is operated
independently of the other Companies. The Companies are competitors.
vi) Each Company is governed by an independent board of directors. The directors of
each Applicant owe duties under the Companies Act 1993 to act in good faith and in
what they believe to be the best interests of the relevant Applicant. No director of
any Applicant is also the director of another Applicant, and each director is
considered non-interested in the Arrangements.
vii) The Arrangements have been negotiated on an arm’s length terms basis, with each
of the Companies having separate independent advisers.
c. Accordingly, the Arrangements have been negotiated on arm's length commercial terms and
while each of the Companies is a Related Party of the other Companies no Company has
influenced the terms of, or the value of, the Arrangements with respect to any other
Company, nor any other Company’s decision to enter into the Arrangements.
d. The certification that will be provided by the Directors of MEL as a condition of the waiver
provides comfort that the Arrangements have been negotiated and entered into on an arm's
length commercial basis, the Arrangements will be in the best interests of MEL and MEL’s
shareholders other than the Crown, and that none of the Companies were influenced to
enter into the Arrangements by the Crown or any other Company.

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Appendix One
Background
1. Each of Genesis Energy Limited (GNE), Meridian Energy Limited (MEL), Mercury NZ Limited
(MCY, together the Companies) and Contact Energy Limited (CEN and, together with GNE, MEL
and MCY, the Gentailers) is a Listed Issuer with shares quoted on the NZX Main Board.
2. Each of GNE, MEL and MCY (together, the Applicants) is a New Zealand incorporated mixed
ownership model company within the meaning of section 45P of the Public Finance Act 1989 (the
PFA).
3. Section 45R of the PFA requires that the Crown must hold at least 51% of each Applicant’s
ordinary shares and will be prohibited from reducing its holding below that level.
4. As the Crown holds more than 50% of each Applicant’s ordinary shares, each of the Applicants
are “Related Bodies Corporate” for the purposes of section 12(2)(c) of the Financial Markets
Conduct Act 2013 (the FMC Act) and therefore “Associated Persons” for the purposes of the
Rules. Each Applicant is therefore a “Related Party” of the other Applicants pursuant to limb (c) of
that definition in the Rules. CEN is not a “Related Party” of any of the Applicants.
5. While the Crown is the majority shareholder in each of the Applicants, it is not involved in any of
the Applicants’ business operations. The Crown’s intentions and expectations in this respect are
publicly outlined (for example) in:
a. the letter from the Minister of Finance to, amongst others, the (then) Chairs of the
Applicants, dated 15 June 2018
1
, which stated:
... shareholding Ministers expect the companies to continue to make commercial decisions,
while of course taking into account the full impact of those decisions.
...the boards and management, not shareholders, are responsible for decision making by the
companies.
b. the letter from Hon. Nicola Willis, Minister of Finance, to the Chairs of each of the Applicants
dated 30 September 2025
2
, which stated:
...The expectations above do not alter the fundamental principles of the relationship between
the Crown as majority shareholder and each of your companies, with your respective boards
of directors, Chief Executives and executive teams, not shareholders, being responsible and
accountable for all company decisions.
... [The letter from the Minister of Finance on 15 June 2018] reinforced, among other
matters, that each of you should make commercial decisions, and your boards and
management are responsible for decision making...
Except as set out in this letter, the Government’s expectations in the letter from the Minister
of Finance on 15 June 2018 remain in place.



1
Letter from the Minister of Finance to the Chairs of Air NZ, Genesis Energy, Mercury NZ and Meridian Energy
2
Correspondence from Hon Willis and Hon Brown to Mixed-Ownership Model chairs

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The Arrangements
6. The Gentailers have entered into conditional arrangements to support dry-year security of
electricity supply and overall system resilience. MEL, MCY and CEN are together referred to as
the Counterparties.
7. The underlying product is a Huntly Strategic Energy Reserve Huntly Firming Option (HSER HFO).
The terms and conditions of the HSER HFO are governed by:
a. a bilateral 2002 ISDA
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Master Agreement and ISDA Schedule (together, the Master
Agreement) between GNE (as floating price payer) and the relevant buyer / fixed price
payer (one of the Counterparties);
b. a bilateral Swaption Confirmation (the Confirmation and, together with the Master
Agreement, the HFO ISDA Agreement) between GNE and the Counterparty; and
c. a multilateral framework agreement (the Framework Agreement).
8. The HFO ISDA Agreements and the Framework Agreement are referred to together as the
Arrangements.
9. In broad terms, the Arrangements provide each of the Counterparties with an option to access
certain notional generation capacity from GNE’s Rankine Units at the Huntly Power Station, albeit
by way of a derivative structure.
10. GNE owns and operates three Rankine Units at the Huntly Power Station. The Rankine Units are
dual-fuel coal and gas-fired electricity generators that have been relied upon by the New Zealand
energy market to provide ‘dry year cover’, including in the winter of 2024 where there was a
shortage of power supply due to low hydro inflows, reduced natural gas supply, a “wind drought”
and increased demand.
11. GNE previously publicly stated that it intended to retire one of its Rankine Units (Rankine Unit 2)
in early 2026. This was (broadly) on the basis that:
a. GNE did not believe it had sufficient certainty to achieve adequate revenues from it because
it was impossible to know when the next dry winter or other fuel or capacity constraint might
be; and
b. GNE believed that without the regular occurrence of dry winters, any such revenues from
the energy-only market were unlikely to offset the fixed costs and the costs of maintaining (i)
Rankine Unit 2 and (ii) a sufficiently large stockpile of coal on site (funded by GNE), in order
to properly utilise the capacity if the market demanded it.
12. Pursuant to the Arrangements:
a. Each of the Counterparties has an option to call a certain volume of financial derivative at a
price equal to the cost of the ‘relevant coal’ multiplied by an efficiency modifier (the Fixed
Price), (the Option) (subject to the upfront payment reconciliation described below). The
Arrangements do not provide for the physical supply of electricity but rather provide each of
the Counterparties with the right to spot price electricity cover at the Huntly node.
b. In exchange for the Option, the Counterparties pay an annual premium, which GNE may
use to contribute to the costs of maintaining, operating and resourcing the Rankine Units.
The annual premium is subject to a reset at year five, and is subject to other adjustments
under the terms of the Arrangements.


3
International Swaps and Derivatives Association (ISDA)

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c. The Framework Agreement establishes a coal ordering process, whereby Counterparties
pay a price for notional coal which reflects the landed cost of that coal. The mechanics of
this process are intended to provide for a fair sharing of risk in the coal ordering process
between GNE and each Counterparty, including adjustments for any differences in the
quantity and specification of the coal received, as well as delays to the actual receipt of the
coal at Huntly. When the Option is exercised, the Counterparties receive a monthly upfront
payment reconciliation (reflecting that Counterparties have paid a price for notional coal and
are also paying the Fixed Price for notional coal use).
d. Each Counterparty’s right to access megawatts (MW) under the Option comprises “Core
Capacity” and “Additional Baseload Capacity”.
i) The Core Capacity is 50 MW per Counterparty, as may be subsequently adjusted for
suspension events pursuant to the Arrangements.
ii) In certain circumstances, each Counterparty will also have the right to call on an
additional 25 MW as Additional Baseload Capacity.
In practical terms, each Counterparty will therefore have an Option to call on 50 MW of “core
capacity”, and will have an additional 25 MW “Additional Baseload Capacity” available in
certain circumstances (Option Capacity).
e. The efficiency modifiers are a mechanism to reflect the different cost and efficiency of
generating a particular MW of electricity using a Rankine Unit for the profile and duration of
the relevant Option call. The efficiency modifiers can be varied depending on matters such
as the applicable energy content of the fuel.
f. The Counterparties agree to pay a price for notional coal, and GNE has an obligation to use
reasonable endeavours to acquire physical coal for a “Strategic Reserve Stockpile”. The
physical stockpile is part of a larger physical coal reserve GNE intends to maintain at the
Huntly site (with the potential to transition to biomass in the future) (Strategic Reserve
Stockpile). Subject to the Arrangements proceeding, the Strategic Reserve Stockpile will be
600kt.
g. In order to exercise its Option, a Counterparty must ensure that it has sufficient notional coal
on its ‘ledger’ at Huntly to generate the MWs that it is calling for. However, for efficiency
and practical purposes, physically separate stockpiles will not be maintained. Each
Counterparty must secure and deliver to GNE sufficient carbon units to cover the notional
emissions associated with the MW it has called pursuant to the Arrangements in the prior
year.
h. GNE will maintain full control of all plant operating decisions including, for example, whether
any Rankine Unit is turned on in response to calls, the price at which all Rankine Unit
generation is offered to the wholesale electricity market, and all other aspects of the
operation of the Rankine Units. For instance, GNE will generate electricity using whichever
Rankine Unit is most efficient to use at the relevant moment in time. GNE also retains
discretion as to the level of investment made in the Rankine Units and the right to put one or
more Rankine Units on outage.
i. Mechanically, the arrangement will be settled by way of a Contract for Difference.
j. All Counterparties are free to call on their Option as they see fit (provided a Counterparty
has the necessary notional coal reserves on its ledger) and have absolute discretion over
how they act in the market having done so.
k. GNE retains absolute discretion as to what it does with all of the capacity from the Rankine
Units. As noted in the market announcement of the signed Term Sheet, assuming the
proposed Arrangements proceed, GNE will make Rankine capacity in excess of the Option

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Capacity under the Arrangements available to the broader market via offering further firming
options and hedge products.
l. There are various provisions to deal with scenarios where there is a failure or interruption to
the ability of one or more Rankine Units to generate electricity or for coal to be obtained.
m. The Arrangements include an agreed process if a Counterparty wishes to exit five years into
the term. The mechanisms are designed to provide a Counterparty with a reasonable ability
to exit whilst recognising GNE’s commitment to the planned capital investment.
13. The Arrangements are conditional upon the New Zealand Commerce Commission granting
authorisation to the Arrangements (or declining to grant authorisation on the basis that it does not
have the legal authority to do so) and have a term ending 31 December 2035 (subject to the early
exit described above).
Application of Rule 5.2.1
14. Rule 5.2.1 prohibits an Issuer from entering into a Material Transaction if a Related Party is, or is
likely to become a direct party to the Material Transaction, or a beneficiary of a guarantee or other
transaction which is a Material Transaction, unless that Material Transaction has been authorised
by an Ordinary Resolution (such resolution being subject to the voting restrictions in Rule 6.3) or
is conditional on such approval.
15. A Material Transaction includes a transaction, or a related series of transactions, whereby an
Issuer:
a. buys, acquires, gains, leases (as lessor or lessee), sells or otherwise disposes of, assets
having an Aggregate Net Value above 10% of the Issuer’s Average Market Capitalisation; or
b. borrows, lends, pays or receives money, or incurs an obligation of an amount above 10% of
the Average Market Capitalisation of the Issuer; or
c. provides or obtains any services where the gross cost to the Issuer in any financial year is
likely to exceed an amount equal to 1% of the Average Market Capitalisation of the Issuer.
16. Each Company is a Related Party of each of the other Companies.
17. The Arrangements are complex and difficult to quantify, given that their value depends on
variables over the lifetime of the Arrangements. Any quantification or valuation of the
Arrangements will be based on assumptions whose ultimate outcome is unknown (including the
future price of electricity, the future price of coal and the cost of generating a particular MW of
electricity using a Rankine Unit at a future time).
18. Given the difficulty in quantifying and valuing the Arrangements, MEL has sought this waiver in
order to provide certainty about the application of the Rules in relation to the Arrangements. MCY
has likewise sought a similar waiver to provide it with the same certainty. However, GNE
considers the Arrangements may well constitute a Material Transaction of GNE for the purposes
of the Rules and it has therefore sought a waiver from the Rules.

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Appendix Two
Rule 5.2 Transactions with Related Parties
5.2.1 An Issuer must not enter into a Material Transaction if a Related Party is, or is likely to
become:
(a) a direct party to the Material Transaction; or
(b) a beneficiary of a guarantee or other transaction which is a Material Transaction,
unless that Material Transaction is approved by an Ordinary Resolution (such resolution
being subject to the voting restrictions in Rule 6.3) or conditional on such approval.

Relevant Definitions
Material Transaction
means a transaction, or a related series of transactions, whereby
an Issuer:

(a) buys, acquires, gains, leases (as lessor or lessee), sells or
otherwise disposes of, assets having an Aggregate Net Value
above 10% of the Issuer’s Average Market Capitalisation;
...
(c) borrows, lends, pays or receives money, or incurs an
obligation of an amount above 10% of the Average Market
Capitalisation of the Issuer ...;
...
(e) provides or obtains any services ... where the gross cost to the
Issuer in any financial year is likely to exceed an amount equal to
1% of the Average Market Capitalisation of the Issuer.
Related Party
means a person who, at the time of a Material Transaction, or at
any time within the previous six months, was:
...
(c) an Associated Person of the Issuer or any of the persons
referred to in (a) or (b) ...
Associated Person
a person (
A
) is associated with, or an
Associated Person
of,
another person (
B
) if:
...
(c) A and B are ... Related Bodies Corporate;
Related Body Corporate
has the meaning given in section 12(2) of the FMC Act.

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Related Body Corporate
(section 12(2) of the
FMC Act)
... a body corporate (
A
) is
related
to another body corporate (
B
) if
–

...

(b) more than half of A’s voting products (other than voting
products that carry no right to participate beyond a specified
amount in a distribution of either profits or capital) are held by B
and bodies corporate that are related to B (whether directly or
indirectly, but other than in a fiduciary capacity), or vice versa;

(c) more than half of the voting products (other than voting
products that carry no right to participate beyond a specified
amount in a distribution of either profits or capital) of each of A
and B are held by members of the other (whether directly or
indirectly, but other than in a fiduciary capacity);

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Meridian Energy Limited
(Meridian)
Directors’ certificate
(Condition of NZ RegCo’s waiver from NZX Listing Rule 5.2.1)
Background
A. Capitalised terms not defined in this certificate have the meanings given to them in the NZX
Listing Rules (the Rules).

B. On 4 August 2025, it was announced that Genesis Energy Limited (Genesis), Meridian,
Mercury NZ Limited (Mercury) and Contact Energy Limited (Contact) have entered into
conditional arrangements to support dry-year security of electricity supply and overall system
resilience (the Arrangements).

C. In broad terms, the Arrangements provide each of Meridian, Mercury and Contact with an
option to access certain notional generation capacity from Genesis’ Rankine Units at the Huntly
Power Station, albeit by way of a derivative structure.

D. Each of Meridian and Mercury is a Related Party of Genesis. For the purposes of Rule 5.2.1,
the Arrangements may be a Material Transaction of Genesis with a Related Party.

E. In a decision of NZX Regulation Limited (NZ RegCo) dated on or around the date of this
certificate, NZ RegCo granted Genesis, Meridian and Mercury a waiver (the Waiver) from Rule
5.2.1 to the extent required to allow Genesis, Meridian and Mercury to enter into and perform
the Arrangements.

F. The Waiver was given on the condition that the directors of each of Genesis, Meridian and
Mercury give a certificate. This certificate is provided by the directors of Meridian (the
Directors).

Certification
We, being Directors who are not interested in the Arrangements, certify that in our opinion:
1. The Arrangements have been entered into, and have been negotiated, on an arm’s length
commercial basis.

2. Meridian was not influenced to enter into the Arrangements by either the Crown or either of
Genesis or Mercury.

3. The granting of the Waiver in respect of the Arrangements is in the best interests of:
(a) Meridian; and
(b) all of Meridian’s shareholders other than the Crown.
4. The Arrangements are in the best interests of:
(a) Meridian;
(b) all of Meridian’s shareholders; and
(c) all of Meridian’s shareholders other than the Crown.

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Grounds for the certification
A summary of the core grounds for the certification are as follows:
The Arrangements have been entered into, and have been negotiated, on an arm’s length
commercial basis

5. Meridian is listed on the NZX Main Board. Both of Genesis and Mercury are separately listed
on the NZX Main Board.

6. Meridian is operated separately from each of Genesis and Mercury.

7. The commercial terms of the Arrangements have been subject to extensive negotiation, with
each of Genesis, Meridian and Mercury having separate independent advisers.

8. Accordingly, the Arrangements have been entered into, and have been negotiated, on an arm’s
length commercial basis.

Meridian was not influenced to enter into the Arrangements by either the Crown or either
of Genesis or Mercury

9. The only reason that Meridian is a Related Party of Genesis and Mercury is due to the Crown
owning more than half of the ordinary shares of each entity.

10. While the Crown is the majority shareholder in Meridian, it is not involved in Meridian’s
business operations.

11. The Crown itself has had no involvement in the development or negotiation of the
Arrangements, nor is it a party to them.

12. Neither of Genesis or Mercury were involved in Meridian’s decision to enter into the
Arrangements.

13. Each of Genesis and Mercury is separately listed on the NZX Main Board and is operated
independently of Meridian. In fact, Genesis and Mercury are competitors of Meridian.

14. Meridian is governed by an independent board of directors. The directors of Meridian owe
duties under the Companies Act 1993 to act in good faith and in what they believe to be the
best interests of Meridian. No director of Meridian is also a director of Genesis or Mercury.

15. Accordingly, Meridian was not influenced to enter into the Arrangements by the Crown or either
of Genesis or Mercury.

The granting of the Waiver in respect of the Arrangements is in the best interests of
Meridian and all of Meridian’s shareholders other than the Crown

16. The Arrangements were negotiated on an arm’s length basis, with each of Genesis, Meridian
and Mercury having separate independent advisers.

17. Meridian was not influenced to enter into the Arrangements by the Crown or either of Genesis
or Mercury.

18. Where the risks that Rule 5.2.1 is designed to protect against are not present, it would be unfair
and prejudicial to shareholders to require Meridian to incur the cost involved in convening a
shareholder meeting to have the Arrangements approved, as that cost will ultimately be borne
by shareholders.

19. Given the above factors, in our opinion, the granting of the Waiver in respect of the
Arrangements is in the best interests of Meridian and all of Meridian’s shareholders other than
the Crown.

3
T
he Arrangements are in the best interests of Meridian and all of Meridian’s
shareholders (both including and excluding the Crown)
20.T
he key objectives of the Arrangements are to support dry-year security of electricity supply
and system resilience, including by:
(a)providing an industry solution which will enable Genesis to keep three Rankine Units i
n
t
he market and available to operate concurrently, subject to plant availability, during th
e
t
erm of the Arrangements;
(b)helping to meet New Zealand’s electricity demands for the term of the Arrangements;
and
(c)supporting confidence, affordability, reducing extreme market volatility and supporting
system resilience.
21.From a purchaser’s perspective there are limited alternative options of an equivalent size/scal
e
t
o the Arrangements for managing its financial exposure arising from a dry year in the near
term.
22.A
ccordingly, in our opinion, the Arrangements are in the best interests of Meridian and all of
Meridian’s shareholders as well as Meridian’s shareholders excluding the Crown.
D
ated 2025
Signed
____
___________________________ _______________________________
David Carter Graham Cockroft
____
___________________________ _______________________________
Michelle Henderson Julia Hoare
____
___________________________ _______________________________
Nagaja Sanatkumar Tania Simpson
____
___________________________
Mark Verbiest
6 November