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THIS DEED OF UNDERSTANDING MADE ON THE 17th DAY OF FEBRUARY 1998
BETWEEN HER MAJESTY THE QUEEN in right of New Zealand, acting by and through the Minister of Communications (“the Minister”)

AND NEW ZEALAND POST LTD, a duly incorporated company having its registered office at 7-27 Waterloo Quay, Wellington (“New Zealand Post”).

Recitals
(A) The Government of New Zealand (“The Government”) has decided to remove the statutory protection for the delivery of certain postal services which had previously been conferred on New Zealand Post Ltd under the Postal Services Act 1987.
(B) The Government desires that New Zealand Post should continue to meet certain social, price and service quality obligations (“the social obligations”).
(C) The Government and New Zealand Post wish to record the social obligations which New Zealand Post will continue to provide.
(D) The Government has agreed that, for a period of 5 years, New Zealand Post will continue to be the sole designated postal administration for New Zealand for the purposes of acting as a representative of New Zealand at the Universal Postal Union and the Asian Pacific Postal Union and shall have the sole right to issue postage stamps on which the words “New Zealand”, or any abbreviation of those words appear, except where those words appear as part of the name of the postal operator by which the stamp is issued; and those words form part of the name under which the postal operator is registered as a company; and that company name of the postal operator appears in full on the stamp, with the words “New Zealand” appearing in the same typeface and point size as the company name.
(E) The Government and New Zealand Post have agreed that the deed entered into by the Government and New Zealand Post dated 6 April 1993, and extended by further deeds dated 11 March 1994, 14 March 1995, 28 March 1996 and 18 March 1997 shall be terminated with effect from the date that this deed comes into force.

BY THIS DEED:
1 This deed shall come into effect on the date that this deed is executed by both parties. In the event that the Postal Services Bill, as reported back to the House of Representatives in December 1997, is amended by the House in such a way as to impose additional social obligations on New Zealand Post, this deed shall be of no effect, and the parties will negotiate a further deed.
2 The Government shall review the terms of this deed three years after the deed comes into effect.

Statutory Protection
3 The parties acknowledge that this deed has been entered into on the basis that New Zealand Post shall continue to be the sole designated postal administration for New Zealand for the purposes of acting as a representative of New Zealand at the Universal Postal Union and the Asian Pacific Postal Union.

Frequency of Deliveries
4 New Zealand Post shall provide:
(a) six day per week deliveries to more than 95 percent of delivery points;
(b) five or six day per week deliveries to more than 99.88 percent of delivery points; and
(c) one to four day per week deliveries to the remainder of delivery points.

PROVIDED THAT in any case where a person elects to have the frequency of that person’s delivery service reduced, that person shall be regarded as continuing to receive the same frequency of service as before that election for the purposes of this clause.

5 New Zealand Post shall not increase the proportion of delivery points comprising counter s