CHORUS LIMITED — Capital/Financing Update 2016

Dec 8, 2016

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Chorus Limited Level 10, 1 Willis Street P O Box 632 Wellington 6140 New Zealand Email: company.secretary@chorus.co.nz

STOCK EXCHANGE ANNOUNCEMENT

9 December 2016

Notification of issue of CFH securities

Chorus Limited has issued further Crown Fibre Holdings (CFH) securities as per the attached notices.

ENDS

For further information:

Brett Jackson Investor Relations Manager Phone: +64 4 896 4039 Mobile: +64 (27) 488 7808 Email: brett.jackson@chorus.co.nz

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

Chorus Limited (“ Chorus ”)

ABN

152 485 848

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	CFH Warrants
	498,690 CFH Warrants
	The CFH Warrants are an option to acquire ordinary shares in Chorus on a specified exercise date at a set strike price. The terms of the issue for the CFH Warrants are as set out in thethe subscription agreement between Chorus and Crown Fibre Holdings Limited (CFH) dated 9 November 2011 (Subscription Agreement). Further details are set out on pages 139 to 142 of the demerger Scheme Booklet dated 13 September 2011 and available at https://www.chorus.co.nz/file/53605/scheme- booklet.pdf

4 Do the[+] securities rank equally in N/a all respects from the[+] issue date with an existing[+] class of quoted +securities? If the additional[+] securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration Nil per CFH Warrant 6 Purpose of the issue Adjustment pursuant to the terms of the Subscription (If issued as consideration for the Agreement acquisition of assets, clearly identify those assets) 6a Is the entity an[+] eligible entity N/a that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the[+] securities the subject of this Appendix 3B , and comply with section 6i 6b The date the security holder N/a resolution under rule 7.1A was passed 6c Number of[+] securities issued N/a without security holder approval under rule 7.1 6d Number of[+] securities issued N/a with security holder approval under rule 7.1A

• See chapter 19 for defined terms.

Appendix 3B Page 2

04/03/2013

6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of+securities issued under an exception in rule 7.2 6g If+securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation. 6h If+securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A. Cross reference: item 33 of Appendix 3B.	N/a
	N/a
	N/a
	N/a
	N/a
	8 December 2016

Number +Class 8 Number and +class of all 406,989,783 fully paid ordinary shares +securities quoted on ASX ( including the +securities in 500,000,000 Euro Medium Term Notes section 2 if applicable)

Number +Class 9 Number and +class of all 265,204,693 CFH Equity Securities +securities not quoted on ASX (unquoted) ( including the +securities in section 2 if applicable) 265,204,693 CFH Debt Securities (unquoted) 16,000,808 CFH Warrants (unquoted) 10 Dividend policy (in the case of a trust, distribution policy) on the CFH Equity Securities increased capital (interests) N/a

Part 2 - Pro rata issue

11 Is security holder approval N/a required? 12 Is the issue renounceable or nonN/a renounceable? 13 Ratio in which the[+] securities will N/a be offered 14 +Class of +securities to which the N/a offer relates 15 +Record date to determine N/a entitlements 16 Will holdings on different N/a registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements N/a in relation to fractions 18 Names of countries in which the N/a entity has security holders who will not be sent new offer documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of N/a acceptances or renunciations

• See chapter 19 for defined terms.

Appendix 3B Page 4

04/03/2013

20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of security holders 25 If the issue is contingent on security holders’ approval, the date of the meeting 26 Date entitlement and acceptance form and offer documents will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do security holders sell their entitlements_in full_through a broker? 31 How do security holders sell_part_ of their entitlements through a broker and accept for the balance?	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a

32 How do security holders dispose N/a of their entitlements (except by sale through a broker)?

33 +Issue date N/a

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

34 Type of[+] securities ( tick one )

• (a) +Securities described in Part 1

• (b)[All other ][+][securities ]

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

36 If the[+] securities are[+] equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories

1 - 1,000

1,001 - 5,000

5,001 - 10,000 10,001 - 100,000 100,001 and over

37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

38 Number of[+] securities for which +quotation is sought

• See chapter 19 for defined terms.

Appendix 3B Page 6

04/03/2013

39 +Class of+securities for which quotation is sought 40 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted +securities? If the additional+securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another+security, clearly identify that other+security) 42 Number and +class of all +securities quoted on ASX (_including_the+securities in clause 38)
	Number	+Class

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

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Sign here: ......................................................... Date: 9 December 2016 ~~(Director/~~ Company secretary)

Print name: Vanessa Oakley

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• See chapter 19 for defined terms.

Appendix 3B Page 8

04/03/2013

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Chorus Limited Level 10, 1 Willis Street P O Box 632 Wellington 6140 New Zealand

Email: company.secretary@chorus.co.nz

NZX Client Market Services NZX Limited Wellington

9 December 2016

NOTIFICATION OF ISSUE OF SECURITIES

For the purposes of Listing Rule 7.12.1 Chorus Limited (NZX: CNU) ( Chorus ) advises that the following Securities have been issued pursuant to the terms of the subscription agreement between Chorus and Crown Fibre Holdings Limited ( CFH ) dated 9 November 2011 ( Subscription Agreement ):

a) Class of CFH Warrants (unquoted) Securities ISIN Not applicable b) Number issued 498,690 c) Issue price Nil d) Payment Nil e) Amount paid up Not applicable f) Principal terms of Securities CFH Warrants are an option to acquire ordinary (other than for Quoted shares in Chorus on a specified exercise date at a Securities) set strike price. Further information regarding the terms of the CFH Warrants is set out in Section 6.4.4 of the demerger scheme booklet dated 13 September 2011 which is available at - https://www.chorus.co.nz/file/53605/scheme booklet.pdf g) Percentage of the total Class Not applicable of Securities issued h) Reason for issue Adjustment pursuant to the terms of the Subscription Agreement. i) Specific authority for issue Board resolution passed on 3 April 2012

Chorus Limited

• j) Terms or details of issue

• k) Total number of Securities of Class after issue

• l) Treasury Stock (acquisition only)

• m) Date of issue

The terms of issue are as set out in the Subscription Agreement. Further information regarding the terms of the CFH Warrants is set out in Section 6.4.4 of the demerger scheme booklet dated 13 September 2011 which is available at - https://www.chorus.co.nz/file/53605/scheme booklet.pdf

• 16,000,808 (unquoted)

Not applicable

• 8 December 2016

Yours faithfully

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Vanessa Oakley General Counsel & Company Secretary

Chorus Limited