O TTO M ARINE L IMITED - Microsoft Internet Explorer - SGX

In particular, the following review procedures have been implemented:
When purchasing sawn timber from Rimalco, we will obtain at least two other quotations from unrelated
third-party suppliers for comparison to ensure that Rimalco’s quotations are fair and reasonable so as not to
compromise the interests of minority Shareholders. The purchase price shall not be higher than the most
competitive price of the two other quotations from unrelated third-party suppliers. In determining the most
competitive purchase price, all pertinent factors, including but not limited to quality, reliability, delivery time,
credit and payment terms and track record will be taken into consideration.
Each of the transactions with Rimalco in relation to the purchase of sawn timber will be monitored as an
individual transaction and, based on the value of the transaction, will require the prior approval of the
corresponding approving authority, who shall be a Director or management employee of the Group (but not an
interested person or his Associate) and who does not have any interests, whether direct or indirect, in relation
to the transaction (the “Relevant Approving Authority”). Guidelines for the Relevant Approving Authority
are as follows:
Approval Limits Relevant Approving Authority
Transactions not exceeding S$250,000 ................ AnytwoDirectors and the CFO
Transactions above S$250,000 ...................... AnytwoAudit Committee members,
one of whom must be the Chairman of
the Audit Committee
As at the Latest Practicable Date, our Group Managing Director Lee Kok Wah, our Non-executive
Director Craig Foster Pickett and the Audit Committee members Reggie Thein, William Edward Alastair
Morrison and Ng Chee Keong, are not related to Rimalco. Reggie Thein is the Chairman of the Audit
Committee.
Other Review Procedures
We have also implemented the following procedures for the identification of Interested Persons and the
recording of all interested person transactions:
(a) our CFO will maintain a register of all transactions carried out with Interested Persons (and the
basis, including the quotations obtained to support such basis, on which these transactions are entered
into), whether mandated or non-mandated;
(b) on a quarterly basis, our CFO will submit a report to our Audit Committee of all recorded
interested person transactions, and the basis of such transactions, entered into by us;
(c) our Company’s internal auditor shall review, on a quarterly basis, all Mandated Transactions
entered into pursuant to the Shareholders’ Mandate to ensure that the relevant approvals have been
obtained and the review procedures in respect of such transactions had been adhered to. The internal
auditor shall report directly to the Audit Committee; and
(d) the Audit Committee shall review from time to time such internal controls and review procedures
for interested person transactions to determine if they are adequate and/or commercially practicable to
ensure that the transactions between us and the Interested Persons are conducted on normal commercial
terms and not prejudicial to the interests of our Company or minority Shareholders. In conjunction with
such review, the Audit Committee will also ascertain whether the established review procedures have
been complied with. Further, if during these periodic reviews, the Audit Committee is of the view that the
internal controls and review procedures for interested person transactions are inappropriate or not
sufficient to ensure that the interested person transactions will be on normal commercial terms and not
prejudicial to the interests of our Company or minority Shareholders, the Audit Committee will (pursuant
to Rule 920(1)(b)(iv) and (vii) of the Listing Manual) revert to Shareholders for a fresh Shareholders’
Mandate based on new internal controls and review procedures for transactions with Interested Persons.
All Mandated Transactions shall be reviewed and approved by the Audit Committee prior to entry while a
fresh mandate is being sought from Shareholders.
For the purposes of the above review of the internal controls and review procedures, any of the Directors
or members of the Audit Committee who are not considered independent, will abstain from participating in
the Audit Committee’s review of the internal controls and review procedures.
The Board and the Audit Committee will have overall responsibility for determining the review
procedures, with the authority to delegate this responsibility to individuals or committees within our Group as
they deem appropriate.
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