This policy applies to all dealings in the Company’s securities by directors, key management personnel and employees of the Company and its wholly-owned subsidiaries (referred to as “Key Persons”).
The purpose of the Policy is to ensure compliance with ASX Listing Rule 12.9 and that Key Persons are aware of the legal restrictions on trading in the Company’s securities while in possession of unpublished price-sensitive information relating to the Company and to impose certain closed periods during which trading is prohibited.
Key Persons must not engage in insider trading or short term or speculative dealings in the Company’s securities.
Who is covered by this Policy
This policy applies to the Company’s Key Persons which include all Directors, executive employees, contractors and consultants of the Company and its wholly-owned subsidiaries and also extends to all dealings by Key Persons’:
- (a) spouses and partners;
- (b) dependents under the age of 18 years; and
- (c) related parties (as defined in the Corporations Act 2001).
All Key Persons should ensure that all transactions in the Company’ securities which may be issued from time to time comply with:
- (a) the Corporations Act 2001 and Regulations (particularly the insider trading provisions); and
- (b) the ASX Listing Rules (particularly the continuous disclosure requirements in Listing Rule 3.1 and the disclosure of Director’s interests in accordance with Listing Rule 3.19A).
The principal insider trading prohibition in Australian law is contained in s. 1043A of the Corporations Act which prohibits a person in possession of inside information relating to a company from dealing or procuring another person to deal in any way with financial products, shares, options or other securities issued by that company or issued or created over the company’s securities by third parties.
Inside information is information that:
- (a) is not generally available to the public; and
- (b) if it were generally available, would or be likely to have a material effect on the price or value of the Company’s securities.
The penalties for breach of the statutory prohibitions can be either criminal or civil or both. At the time of drafting of this policy, criminal penalties can be imprisonment for up to five years, a fine of up to $220,000, or both, while civil penalties may be a fine of up to $200,000 for an individual.
Dealings in the Company’s Securities by Key Persons
Key Persons are not permitted to deal in the Company’s securities during Prohibited Periods.
Prohibited Periods for the purposes of this Trading Policy are:
(a) Closed Periods, being:
- (i) the ten (10) trading day period immediately leading up to the day of the announcement of the Company’s Half-yearly and Annual Reports and two (2) trading days after these Announcements are made; and
- (ii) the five (5) trading day period prior to the anticipated release of price sensitive information/results; and
(b) additional periods when Key Persons are not allowed to trade which are imposed by the Company from time to time particularly when the Company is considering matters which are subject to Listing Rule 3.1A.
Key Persons must not grant a lender any security interest over the Company’s securities they hold without the prior written consent of the Company.
A Key Person may trade in the Company’s securities during a Prohibited Period if that trading falls within one of the following categories of “excluded trading”:
- transfers of the Company securities already held into a superannuation fund or other saving scheme in which the Key Person is a beneficiary;
- an investment in, or trading in units of, a fund or other scheme (other than a scheme only investing in the securities of the Company) where the assets of the fund or other scheme are invested at the discretion of a third party;
- where the Key Person is a trustee, trading in the securities of the Company by that trust provided the Key Person is not a beneficiary of the trust and any decision to trade during a Prohibited Period is taken by the other trustees or by the investment managers independently of the Key Person;
- undertakings to accept, or the acceptance of, a takeover offer;
- trading under an offer or invitation made to all or most of the security holders, such as, a rights issue, a security purchase plan, a dividend or distribution reinvestment plan and an equal access buy-back, where the plan that determines the timing and structure of the offer has been approved by the Board. This includes decisions relating to whether or not to take up the entitlements and the sale of entitlements required to provide for the take up of the balance of entitlements under a renounceable pro rata issue;
- a disposal of securities of the Company that is the result of a secured lender exercising their rights, for example, under a margin lending arrangement;
- the exercise (but not the sale of securities following exercise) of an option or a right under an employee incentive scheme, or the conversion of a convertible security, where the final date for the exercise of the option or right, or the conversion of the security, falls during a prohibited period and the entity has been in an exceptionally long prohibited period or the entity has had a number of consecutive prohibited periods and the restricted person could not reasonably have been expected to exercise it at a time when free to do so; and
- trading under a non-discretionary trading plan for which prior written clearance has been provided in accordance with procedures set out in this Policy and where:
- (i)the Key Person did not enter into the plan or amend the plan during a Prohibited Period; and
- (ii)the trading plan does not permit the Key Person to exercise any influence or discretion over how, when, or whether to trade.
Trading with consent
A Key Person who wishes to trade in the Company’s securities during a Prohibited Period (‘Applicant’) must obtain the prior written permission (whether by letter, facsimile, electronic or other form of written communication) of the Chairman and Chief Executive Officer/Managing Director (‘Approvers’) through the Company Secretary.
Where either of the Approvers is the Applicant, such application is to be made to the other of them.
Trading cannot occur prior to the consent or authorisation being provided to the Key Person and must be obtained by the Applicant not less than 2 business days before the proposed trade and shall expire within 10 days (or such other period as may be specified) of being granted.
The Approvers may only grant consent (which can only be in written form, whether by letter, facsimile, electronic or other form of written communication) to trade in the Company’s securites where:
- the Key Person is experiencing severe financial hardship or other exceptional circumstances; and
- the Approvers are satisfied that the Key Person is not in possession of inside information.
- The Approvers have the sole discretion to decide whether the above requirements are met and whether consent to trade should be granted.
Examples of severe financial hardship and exceptional circumstances are:
- (a) severe financial hardship where a Key Person has a pressing financial commitment that cannot be satisfied otherwise than by selling the Company’s securities;
- (b) court order requiring the sale or transfer of the Company securities; or
- (c) any other circumstances deemed to be an exceptional circumstance by the Approvers.
- The application to trade with consent must include:
- (a) the name of the Key Person;
- (b) whether the interest the Key Person’s interest in the Company’s securities is direct or indirect (if indirect, the circumstances giving rise to the interest);
- (c) a statement that the Key Person does not believe he/she is in possession of any Inside Information and is not involved in short term or speculative dealing in the Company’s securities;
- (d) details of the trade including:
- the proposed date of the trade;
- the nature of the trade, eg disposal or acquisition
- the number and type of securities to be traded;
- the amount to be received for the securities; and
- the number of securities held by the Applicant, directly and indirectly, before and after the trade.
The Key Person must confirm with the Company Secretary within 2 business days of the trade that the trade has occurred and provide copies of relevant documentation.
ASX Disclosure Obligations
Key Persons with a substantial shareholding in the Company’s securities (more than 5% of the issued capital) are also required to comply with the substantial shareholding notification provisions of the Corporations Act 2001 when there is a change in their holding. In this instance a notice must be provided to the ASX and to the Company in the prescribed form within 2 business days of the change.
Strict compliance with this Securities Trading Policy is mandatory for all Key Persons as breaches may damage the reputation of the Company in the investment community and undermine confidence in the market for the Company’s securities.
Breaches of the policy will be taken very seriously and will be subject to disciplinary action, including possible termination of employment.
The requirements imposed by this Policy are separate from, and additional to, the legal prohibitions in the Corporations Act on insider trading.