2. WHAT TYPES OF TRANSACTIONS ARE COVERED BY THIS POLICY?
3. WHAT IS INSIDER TRADING?
- that person possesses information which is not generally available to the market and, if it were generally available to the market, would be likely to have a material effect on the price or value of the Company‟s securities (ie, information that is "price sensitive");
- and that person:
- buys or sells securities in the Company; or
- procures someone else to buy or sell securities in the Company; or
- passes on that information to a third party where that person knows, or ought reasonably to know, that the third party would be likely to buy or sell the securities or procure someone else to buy or sell the securities of the Company.
- the Company considering a major acquisition or disposal of assets;
- the threat of major litigation against the Company;
- the Company‟s sales and profit results materially exceeding (or falling short of) the market‟s expectations;
- a material change in debt, liquidity or cash flow;
- a significant new development proposal i.e., new product or technology;
- the granting (or loss) or a major contract;
- management or business restructuring proposal; and
- a share issue proposal.
4. GUIDELINES FOR TRADING IN THE COMPANY’S SECURITIES
- in the ten days immediately preceding the release of the Company‟s Quarterly Activities Report and Quarterly Cashflow Report to the Australian Securities Exchange (ASX) (Quarterly Reports) in accordance with the ASX Listing Rules (or, if shorter, the period from the end of the quarter to the time of publication); and
- in the two days immediately after the release of the Company‟s Quarterly Reports. The Company may at its discretion vary this rule in relation to a particular period by general announcement to all employees either before or during the period. However, if a Director or employee of the Company is in possession of price sensitive information which is not generally available to the market, then they must not deal in the Company‟s securities at any time.
- Directors and all employees may at any time:
- acquire ordinary shares in the Company by conversion of securities giving a right of conversion to ordinary shares;
- acquire Company securities under a bonus issue made to all holders of securities of the same class;
- acquire Company securities under a dividend reinvestment, or top-up plan that is available to all holders or securities of the same class;
- acquire, or agree to acquire or exercise options under a Company Share Option Plan;
- withdraw ordinary shares in the Company held on behalf of the employee in an employee share plan where the withdrawal is permitted by the rules of that plan; and
- acquire ordinary shares in the Company as a result of the exercise of options held under an employee option scheme.
- It is noted that the Company does not have in place any active share or option plans. However, it should be noted that should it do so:
- it is not permissible to provide the exercise price of options by selling the shares acquired on the exercise of these options unless the sale of those shares occurs during one of the 4 week periods specified in paragraph 4.1; and
- where the exercise price of options is being provided by a margin loan or other form of lending arrangement then there may be a risk that the employee or Director may need to sell shares to avoid providing additional capital or security to the lender in the event of a decrease in the value of the shares.
Were this to occur at a time when the person possessed inside information then the sale of Company securities would be a breach of insider trading laws, even though the person‟s decision to sell was not influenced by the inside information that the person possessed and the person may not have made a profit on the sale. Where Company securities are provided to a lender as security by way of mortgage or charge a sale that occurs under that mortgage or charge as a consequence of default would not breach insider trading laws.
5. APPROVAL AND NOTIFICATION REQUIREMENTS
- Any Director wishing to buy, sell or exercise rights in relation to the Company‟s securities must obtain the prior approval of the Chairman or the Board before doing so;
- If the Chairman wishes to buy, sell or exercise rights in relation to the Company‟s securities the Chairman must obtain the prior approval of the Board before doing so;
- Any first or second line reports of the Chief Executive Officer wishing to buy, sell or exercise rights in relation to the Company‟s securities must obtain his prior approval before doing so;
- Any Director or employee who (or through his or her Associates) buys, sells, or exercises rights in relation to Company securities must notify the Company Secretary in writing of the details of the transaction within five (5) business days of the transaction occurring. This notification obligation operates at all times but does not apply to acquisitions of shares or options by employees made under employee share or option schemes, nor does it apply to the acquisition of shares as a result of the exercise of options under an employee option scheme.
- Comply with any conditions on trading imposed by the Chairman (including, for example, any time limits applicable to the clearance);
- The applicant must confirm that they do not hold any inside information;
- Directors and employees that have been advised by the Chairman that there is no reason to preclude him from trading in the Company‟s securities as notified;
- In the case of any other Restricted Person, they must notify and obtain clearance from the Company Secretary before trading, or giving instructions for trading.