Osim FR 050407.indd

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Appendix (cont’d)3.4 Review Procedures for Interested Person Transactions3.4.1 To ensure that the Interested Person Transactions arising in the normal course of business of the Group are undertaken atarm’s length and on the Group’s normal commercial terms, and will not be prejudicial to the interests of the Company andits minority Shareholders, the following guidelines will be implemented for the review and approval of Interested PersonTransactions under the proposed renewal of the Shareholders’ Mandate:-(a)(b)Franchising, distribution and licensing agreementsNo franchising, distribution and licensing fees are payable by the PRC Affi liates.Sales of healthy lifestyle productsThe sale of healthy lifestyle products by the Group shall not be approved unless the pricing policy and the terms areno more favourable to the Interested Person than the usual commercial terms extended to unrelated third partiestaking into consideration factors such as, but not limited to, market conditions, brand awareness and tax structures,in the relevant markets.The selling price of products is reviewed by the Chief Executive Offi cer, the Chief Operating Offi cer and the ChiefFinancial Offi cer on a regular basis.The following transactions are subject to review by the Audit Committee and approval by the Board of Directors:-(i)(ii)transactions of value above $1 million; ortransactions with the same Interested Person with aggregated value of above 3% of the Company’s NTA. TheAudit Committee will review the transactions which are subject to the aggregation.3.4.2 Each Interested Person Transaction will be properly documented and submitted to Audit Committee which will review suchtransactions on a quarterly basis to ensure that they are carried out on normal arm’s length and commercial terms.3.4.3 In addition to the guidelines set out above, the Audit Committee of the Company will also undertake the following periodic reviews:(a)(b)(c)the Audit Committee will carry out an annual review to ascertain that the established guidelines and procedures forthe Interested Person Transactions have been compiled with; andthe Audit Committee will consider from time to time whether the established guidelines and procedures for theInterested Person Transactions have become inappropriate or are unable to ensure that the transactions will be onthe Group’s normal commercial terms and will not be prejudicial to the interests of the Company and its minorityShareholders.If a member of the Audit Committee has an interest in an Interested Person Transaction to be reviewed by the AuditCommittee, he will abstain from any decision-making in respect of that transaction and the review and approval ofthat transaction will be undertaken by the remaining members of the Audit Committee.Appendix 183Annual Report 2006
Appendix (cont’d)4. Rationale and BenefitThe Shareholders’ Mandate will enhance the ability of companies in the Group to pursue business opportunities which are timesensitivein nature, and will eliminate the need for OSIM to announce, or to announce and convene separate general meetings oneach occasion to seek Shareholder prior approval for the entry by the relevant company in the Group into such transactions. Thiswill substantially reduce the expenses associated with the convening of general meetings on an ad hoc basis, improve administrativeeffi cacy considerably, and allow manpower resources and time to be channeled towards attaining other corporate objectives.5. Validity Period of the Shareholders MandateThe renewal of the Shareholders Mandate will take effect from the passing of the ordinary resolution relating thereto, and will (unlessrevoked or varied by the Company in general meeting) continue in force until the next Annual General Meeting of the Companyfollowing thereafter. Approval from Shareholders will be sought for the renewal of the Shareholders Mandate at the subsequentAnnual General Meeting of the Company and each Annual General Meeting thereafter, subject to satisfactory review by the AuditCommittee of its continued application to the transactions with Interested Persons.6. Disclosure of Interested Person Transactions pursuant to Shareholders Mandate6.1. The Company will announce the aggregate value of transactions conducted with Interested Persons pursuant to the ShareholdersMandate for the quarterly fi nancial periods which the Company is required to report on pursuant to the Listing Manual and withinthe time required for the announcement of such report.6.2. Disclosure will also be made in the Company’s Annual Report of the aggregate value of transactions conducted with InterestedPersons pursuant to the Shareholders Mandate during the fi nancial year, and in the Annual Reports for subsequent fi nancial yearsthat the Shareholders Mandate continues in force, in accordance with the requirements of Chapter 9 of the Listing Manual.7. INTERESTS OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS7.1 Directors As at the Latest Practicable Date, the direct and indirect interests of each of the Directors in the Shares and Share Optionsof the Company are as follows:-Number of SharesNumber of sharesDirect InterestIndirect Interestcomprised inNumber % (1) Number % (1) outstanding ShareOptionsRon Sim Chye Hock 122,901,938 22.69 160,218,058 29.58 -Teo Sway Heong 4,059,448 0.75 279,060,548 51.51 -Teo Chay Lee 1,462,000 0.27 - - 788,040Leow Lian Soon 2,250,000 0.42 67,500 0.01 40Lee Hwai Kiat 72,000 0.01 - - 483,120Michael Kan Yuet Yun 382,498 0.07 - - 21,600Ong Kian Min 337,497 0.06 - - 66,600Khor Peng Soon 36,000 0.01 - - 21,600Note:-(1)Based on the total issued and fully paid-up ordinary share capital of 541,728,189 shares as at the Latest Practicable Date.Appendix 184Annual Report 2006
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Process and Performanceas the growt
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Customer Service Department“I put
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Sales Department“I look forward t
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Research & Development“Every prod
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Contents17 CEO’s Message22 The Ro
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... ensuring that as we grow,they g
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previous year. Q4 2006 revenue rose
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The Role ModelsThe Role Models 22 A
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Ms Teo Sway HeongNon-Executive Dire
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Mr Peter Lee Hwai KiatMs Celine Cha
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Result of our Growth StrategyThe Gr
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Performance ReviewIn building a glo
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ProfitabilityIn FY2006, buoyant rev
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An Environment of GrowthMarch 2006
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Financial HighlightsOur goal is to
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Number of OutletsOSIM OutletsNorth
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Capital ExpenditureCapexS$’000 Le
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Corporate Structure as at 21 Februa
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OSIM Global NetworkSINGAPORECHINATA
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Corporate InformationBoard of Direc
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Non Executive DirectorMs Teo Sway H
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Corporate Governance Report 51 Annu
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The Company worked closely with a p
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New directors are at present appoin
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In 2006, the Audit & Risk Managemen
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The aggregate value of interested p
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Financial Contents64 Directors’ R
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Directors’ ReportFor the Year end
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Directors’ Report (cont’d)Share
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Directors’ Report (cont’d)Share
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Directors’ Report (cont’d)Audit
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Independent Auditors’ Reportto th
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Balance Sheetsas at 31 December 200
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Consolidated Profit and Loss Accoun
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Statements of Changes in Equity for
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Consolidated Cash Flow Statementfor
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Consolidated Cash Flow Statement fo
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Osim FR 050407.indd

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