Share Trading Policy
The Share Trading Policy sets out the policy of OrotonGroup Limited (OGL) with regards to dealings in shares, options and other securities of the OGL (collectively known as “Securities”, and includes financial products issued or created over OGL securities by third parties, or associated products).
This policy applies to all directors, employees, and each consultant and contractor to OGL whose terms of engagement involve this Policy (collectively known as “Relevant Persons”). Some aspects of the Policy also extend to or affect persons connected to the Relevant Persons such as immediate family members, or companies, trusts and other entities controlled by them.
Additional restrictions, as set out in this policy, apply to the following persons:
• OGL directors;
• The Management Team, consisting of the Chief Executive Officer, Chief Executive Officer’s direct reports, Departmental Managers and Commercial Managers; and
• Other Designated Persons who are notified that the relevant sections of the policy apply to them.
In line with ASX Listing Rules12.9,12.12 and Guidance Note 27 (“Trading Policies”), the purpose of this Policy is to:
• Explain the insider trading law prohibitions as set out by The Corporations Act 2001 (Commonwealth); and
• Establish a best practice procedure for buying and selling securities that protects the Company, directors, employees, consultants and contractors against the misuse of unpublished information.
Insider trading is a criminal offence which may result in fines and imprisonment. Other potential consequences include civil penalties and compensation claims.
In addition to these legal consequences, any non-compliance is regarded by OGL as a serious act of misconduct and will result in disciplinary action.
This is an important document. If you do not understand or have any doubts about any aspect of this policy, please contact the OGL Company Secretary.
2 Insider Trading Prohibitions
As set out by The Corporations Act 2001 (Commonwealth), it is illegal for any person to deal in the OGL’s Securities if that person knows, or ought reasonably to know:
• That he or she possesses information which is not generally available to the public; and
• That the information may have a material effect on the price of the OGL’s Securities if it was generally available (Inside Information).
In addition, a person with inside information must not procure another person to deal in OGL’s Securities or communicate the information (directly or indirectly) to another person whom the person believes may deal (or procure someone else to deal) in OGL’s Securities.
Information is regarded as being “generally available” if:
• It consists of readily observable matter; or
• It has been brought to the attention of investors by an ASX announcement and a reasonable period for its dissemination has elapsed since the announcement; or
• It consists of observations, deductions, conclusions or inferences made or drawn from other generally available information.
Information is considered to have “material effect” on the value of a company’s Securities if the information would, or would be likely to, influence persons who commonly invest in securities in deciding whether or not to subscribe for, buy or sell those securities. Examples of the types of this type of information include:
• Financial performance;
• Actual or proposed takeover or merger;
• Actual or proposed major changes in operations or products;
• Actual or proposed major asset purchases and sales;
• Significant litigation.
Insider Trading is prohibited for all Relevant Persons at any time, irrespective of policies set out in the subsequent sections of this Policy.
The prohibitions also extend to Securities of all other listed companies which OGL may have dealings with, for example, the Company’s customers, suppliers or contractors. Where a Relevant Person possesses Inside Information in relation to that other company, he or she is prohibited from dealing in that company’s Securities.
3. Additional policies
3.1 Blackout periods for directors and Management Team
During certain periods of the year, the Company’s directors, Management Team and other Designated Persons are prohibited from dealing in the Company’s Securities. The periods during which dealing is allowed are as per below:
• From twenty four (24) hours after the release of the company’s half year results until six (6) weeks after the release of the company’s half year results,
• From twenty four (24) hours after the release of the company’s full year results until six (6) weeks after the release of the company’s full year results,
• From twenty four (24) hours after the company’s Annual General Meeting until two (2) weeks after the company’s Annual General Meeting.
Exemptions to Blackout periods
Some dealings are exempt from these Blackout periods. These usually involve situations where the Relevant person has no influence over the dealing, or the dealing occurs under an offer to all or most of the security holders of OGL.
Some examples of exempt dealings are listed below. If you believe that you are facing a situation where you should be exempt from the Blackout period but it is not listed below, please contact the Company Secretary to discuss this.
• Transfers of OGL’s Securities already held, into a superannuation fund in which the restricted person is a beneficiary;
• Dealings in a fund investing in OGL’s Securities where the fund is managed by a third party;
• Where a restricted person is a trustee, trading in the OGL’s Securities by that trust provided the restricted person is not a beneficiary of the trust and any decision to deal in the Blackout period is taken by other persons independent of the restricted person;
• Undertakings to accept, or the acceptance of, a takeover offer;
• Rights issues, bonus issues or other security purchase plans, dividend reinvestment plans and other similar arrangements;
• The exercise of Performance rights under the employee incentive scheme, if the restricted person could not reasonably have been expected to exercise it outside of a Blackout period, due to the final date of exercise falling in an exceptionally long Blackout period, or there having been a number of consecutive Blackout periods.
• A structured purchase plan by the Oroton Share Plan Company such that any share purchases which fall into blackout periods are not of an opportunistic in nature.
A person who is otherwise subject to the Blackout period may be given prior written clearance to sell or otherwise dispose of OGL’s Securities if the person is in severe financial hardship or there are other exceptional circumstances, provided that the person is not in possession of Insider Information. Note that a tax liability would not normally constitute severe financial hardship unless the person has no other means to pay the tax liability.
In such instances, the person seeking clearance must notify the Chairman of the Board of Directors or the Chairman of the Audit Committee (where the Chairman of the Board of Directors is involved) in writing at least fifteen (15) working days prior to the intended day of trade by filling out the form attached in Appendix 1. If Clearance is granted, it will be given in writing via either paper or email, and the person must confirm such dealings with the Chairman of the Board of Directors or Chairman of the Audit Committee (whichever being relevant) within two (2) business days of the dealing.
The Chairman may grant Key Management Team Members written permission to deal in OGL securities during a prohibited period if the Chairman is satisfied that the person’s circumstances amount to exceptional circumstances due to :
1 The person suffering severe and unforeseen financial hardship,
2 The person suffering severe and unforeseen health issues,
3 The person being bound by a court order, enforceable undertaking or other legal or regulatory requirement to transfer or sell securities of ORL; or
4 The person’s circumstances being otherwise exceptional and the proposed dealing is the only reasonable course of action available.
3.2 Short term or speculative dealing restrictions
All Relevant Persons must not deal in the Company’s Securities on a short-term trading basis, i.e. within a six (6) month period.
This encourages long-term holding of the Company’s securities, and promotes market confidence in the integrity of the Company’s people.
Exemptions to this policy include:
• The sale of shares where the shares have been recently acquired due to the vesting of Performance Rights; and
• Instances of financial hardship, where the person must seek clearance from the Chairman of the Board of Directors or the Chairman of the Audit Committee (where the Chairman of the Board of Directors is involved) as outlined in the previous section
3.3 No hedging of securities
Directors, the Management Team and other Designated Persons must not enter into hedging arrangements with respect to the Company’s Securities, including the use of derivatives over unvested Performance Rights.
This ensures a proper alignment of incentives, i.e. all above mentioned persons are performing their roles in the interest of improving the Company’s sales and profitability, and increasing share prices.
There may be exemptions from this policy, such as when the hedging is carried out in respect of a portfolio of securities, and where the Company’s shares do not constitute a majority of the portfolio. if you believe that you are facing a situation where you should be exempt from this Policy, please contact the Company Secretary to discuss this. You will need clearance from the Chairman of the Board of Directors or the Chairman of the Audit Committee (where the Chairman of the Board of Directors is involved) to be exempt from the policy.
3.4 Margin lending
Margin lending poses special risks to the compliance of this Policy, such as where a margin call requires the disposal of the Company’s Securities at a time when a person is in possession of Inside Information. Accordingly, directors, the Management Team and other Designated Persons must notify and obtain consent from the Chairman of the Board of Directors or the Chairman of the Audit Committee (where the Chairman of the Board of Directors is involved) prior to making any margin lending arrangements. These arrangements include but are not limited to the following:
• Entering into a margin lending arrangement in respect of the Company’s Securities;
• Transferring the Company’s Securities into an existing margin loan account; and
• Selling the Company’s Securities to satisfy a call pursuant to a margin loan.
3.5 Notification of all transactions
Even when clearance from any of the above policies is not required, whenever a director, a member of the executive team, or other management or employees wishes to deal in the Company’s Securities, he/she must make a request in writing addressed to the Chairman (for Directors and CEO), Audit Committee Chairman (For Chairman) and CEO copied to the Chairman for information (for all other employees) seeking approval at least forty-eight (48) hours prior to the intended transaction.
Note that under the ASX Listing Rules the Company is required to notify the ASX of any dealings in the Company’s Securities carried out by directors within 5 business days of such dealings taking place. Directors should therefore also confirm their dealings within TWO (2) business days of the dealing taking place to enable the Company to comply with its obligations under the Listing Rules.