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PETRA FOODS LIMITED
ANNUAL REPORT 2015
AP P END I X ( S HAR EHOLDE R S ’ MANDAT E )
2.
THE RENEWAL OF THE SHAREHOLDERS’ MANDATE FOR INTERESTED PERSON TRANSACTIONS
(continued)
2.4
Review Procedures for Interested Person Transactions
The Company has established the following guidelines and procedures to ensure that all Interested Person
Transactions are made on the Company’s normal commercial terms and are consistent with the Group’s usual
business practices and policies, which are generally no more favourable to the Interested Person than those
extended to unrelated third parties:-
(a)
All Interested Person Transactions will be documented and submitted periodically to the Audit
Committee for their review to ensure that such transactions are carried out on an arm’s length basis and
on normal commercial terms and are not prejudicial to the Company. In the event that a member of
the Audit Committee is deemed to have an interest in an Interested Person Transaction, he will abstain
from reviewing that particular transaction. The Audit Committee will include the review of Interested
Person Transactions as part of the standard procedures during the Audit Committee’s examination of the
adequacy of the Group’s internal controls.
(b)
In respect of any purchase of products or procurement of services from Interested Persons, quotes
received from at least two unrelated third parties in respect of the same or substantially the same types
of transactions are to be used as a comparison wherever possible. The Audit Committee will review
these comparables, taking into account pertinent factors, including but not limited to:
(i)
whether the pricing is in accordance with the Company’s usual business practice and policies;
(ii)
quality of the products offered;
(iii)
delivery time;
(iv)
track record; and
(v)
whether the terms are no more favourable to the Interested Persons than those extended by
unrelated third parties.
In cases where it is not possible to obtain comparables from other unrelated third parties, the Company
may enter into the transaction with the Interested Person provided that the price and terms received
from the Interested Person are no less favourable than those extended by the Interested Person to the
unrelated third parties, taking into account all pertinent factors including, but not limited to business
practices, industry norms, volume, quality, delivery time and track record.
(c)
In respect of any sale of products to Interested Persons, the Audit Committee will review the terms of
the sale to ensure that they are not prejudicial to the interest of the Shareholders, taking into account
pertinent factors, including but not limited to whether transactions with Interested Persons have been
carried out at the prevailing market rates or prices on terms which are no more favourable to the
Interested Person than the usual commercial terms extended to unrelated third parties.
Where the prevailing market rates or prices are not available due to the nature of the product to be sold,
the Company may enter into the transaction with the Interested Person provided that the pricing policies
are consistent with the usual margin obtained by the Group for the same or substantially similar type
of transaction with unrelated third parties. In determining the transaction price payable by Interested
Persons for such products, factors such as, but not limited to, quantity, volume, consumption, customer
requirements, specifications and duration of contract will be taken into account.
