Code of Conduct for prohibition of insider trading
The Securities and Exchange Board of India (SEBI) has over the years introduced various amendments to the Insider Trading Regulations of 1992 which ordain new action steps by corporates and other market intermediaries for the purposes of prohibition of insider trading.
Pursuant to the above requirements of SEBI (Prohibition of Insider Trading) Regulations, 1992 as amended, the Company adopted a Code of Conduct namely "Vaarad Ventures Limited Code of Conduct for Prohibition of Insider Trading" ("Code"). The Code for prohibition of insider trading is amended from time to time reflecting the changes brought in by SEBI in the Insider Trading Regulations. The Code is applicable to all Directors and such designated employees who are expected to have access to unpublished price sensitive information relating to the Company.The Company Secretary has been appointed as the compliance officer for monitoring adherence to the said Regulations.
"VAARAD VENTURESLIMITED CODE OF CONDUCT FOR PROHIBITION OF INSIDER TRADING"
TO REGULATE, MONITOR AND REPORT TRADING BY INSIDERS [Under Regulation 9 (1) and (2) of SEBI (Prohibition of Insider Trading) Regulations, 2015]
Insider trading means trading in Securities of a company by its Directors, Employees or other Insiders while in possession of Unpublished Price Sensitive Information (“UPSI”). Such trading by Insiders erodes the investor’s confidence in the integrity of the management and is unhealthy for the capital markets.
The Securities and Exchange Board of India (SEBI), in its endeavour to protect the interests of investors in general, had formulated the SEBI (Prohibition of Insider Trading) Regulations, 1992 under the powers conferred on it under the SEBI Act, 1992, which came into effect from November 19, 1992 and the same were made applicable to all companies whose shares were listed on Indian stock exchanges.The Securities Exchange Board of India, on January 15, 2015, notified the SEBI (Prohibition of Insider Trading) Regulations, 2015, (“Regulations”), to be effective from May 15, 2015. Pursuant to the aforesaid Regulations, every listed company is required to formulate and publish on its official website, a Code of Conduct to Regulate, Monitor and Report Trading by its Employees and other Connected Persons, along with a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information.This document embodies the Code of Conduct to Regulate, Monitor and Report Trading by Insiders and the Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (‘the Code’) to be adopted by the Company and followed by their Directors, Employees and other Connected Persons. The Code is based on the principle that Directors and Employees of the Company owe a fiduciary duty to, among others, the shareholders of the Company to place the interest of the shareholders above their own and conduct their personal Securities transactions in a manner that does not create any conflict of interest situation.The Code is also intended to serve as a guiding charter for all concerned persons associated with the functioning of the Company and trading in Securities of the Company. Further, the Code also seeks to ensure timely and adequate disclosure of UPSI to the investor community by the Company to enable them to take informed investment decisions with regard to the Company’s Securities. The provisions of this Code have to be read along with the Regulations and if there is any inconsistency/contradiction between the two, the provisions of the Regulations shall prevail.
As used in this Code:
(a) “Board” means Board of Directors of the Company.
(b) “Code” means this Code of Conduct to Regulate, Monitor and Report Trading by Insiders and the Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information, as applicable, including modifications made thereto from time-to-time.
(c) “Company” means “Vaarad Ventures Limited”.
(d) “Connected Person” shall have the meaning given to it under Regulation 2(d) of the Regulations and shall also include the promoters and their directors and key managerial personnel.
(e) “Designated Persons” means: -
i. Directors; and
ii. such Employees and Connected Persons as identified in consultation with the Board in line with the objectives of this Code.
(f) “Director” means a member of the Board of Directors of the Company.
(g) “Employee” means every employee of the Company (whether working in India or abroad) including the Directors in the employment of the Company.
(h) “Generally Available Information” means information that is accessible to the public on a non-discriminatory basis, such as information published on websites of stock exchanges.
(j) “Immediate Relative” means the spouse of the person, and includes parent, sibling and child of such person or of the spouse, who are either financially dependent on the person or consults the person in taking decisions relating to trading in securities.
(k) “Insider” means any person who is a Connected Person or in possession of or having access to Unpublished Price Sensitive Information.
(l) "Promoter" shall have the meaning assigned to it under the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 or any modification thereof.
(m) “Securities” shall have the meaning assigned to it under the Securities Contracts (Regulation) Act, 1956 (42 of 1956) or any modification thereof except units of a mutual fund.
(n)“Specified Persons” means all Promoters, Directors, Key Managerial Personnel, including Designated Persons.
(o) “Trading Day” means a day on which the recognized stock exchanges are open for trading.
(p) “Trading in Securities” means and includes an act of subscribing to, buying, selling, dealing or agreeing to subscribe to, buy, sell or deal in any Securities of the Company and “trade” shall be construed accordingly.
(q) “Key Managerial Personnel” means a person defined under Section 2(51) of the Companies Act, 2013.
(r) “Unpublished Price Sensitive Information (“UPSI”)” means any information, relating to the Company or its Securities, directly or indirectly, that is not generally available which upon becoming generally available, is likely to materially affect the price of Securities of the Company and shall, ordinarily include but not be restricted to, information relating to the following:
(i) financial results;(ii) dividends; (iii) change in capital structure; (iv) mergers, de-mergers, acquisitions, delisting, disposals and expansion of business and such other transactions;(v)changes in key managerial personnel; and (vi) material events in accordance with the Listing Agreement
All terms used in this Code but not defined hereinabove shall have the meanings ascribed to them under the Regulations.
3. Prohibition on communicating or procuring UPSI
An Insider shall not –
i. communicate, provide, or allow access to any UPSI, relating to the Company or its securities, to any person including other insiders, except to the extent allowed by these Rules;
ii. procure from or cause the communication by an Insider of UPSI, relating to the Company or its securities;
Provided that nothing contained above shall be applicable when an UPSI is communicated, provided, allowed access to or procured:
(i) in furtherance of legitimate purposes, performance of duties or discharge of legal obligations pursuant to appropriate confidentiality and non disclosure agreements being executed; or
(ii) in the event the Board of Directors direct or cause the public disclosure of UPSI in the best interest of the Company; or
(iii) within a group of persons if such persons have been identified and secluded within a “chinese wall” or information barrier by the Compliance Officer from the rest of the Company for a particular purpose or for a specified period of time in furtherance of legitimate purposes, performance of duties or discharge of legal obligations, and are subjected to, among other conditions, additional confidentiality obligations, information barriers designed to prevent exchanges of UPSI outside the “chinese wall”, and the execution of an undertaking by such persons to abstain and / or forego Trading during such seclusion or till the UPSI no longer constitutes UPSI.
4. Prohibition on Insider Trading
An Insider shall not, directly or indirectly, –
i. Trade in securities that are listed or proposed to be listed when in possession of UPSI;
ii. Trade in securities of the Company except when the Trading Window is open and the Insider is not in possession of UPSI.
Provided the restriction in 4 (i) above shall not apply to:
(a) a transaction that is an off-market inter-se transfer between Promoters who were in possession of the same UPSI without being in breach of these Rules and both parties had made a conscious and informed trade decision; and
(b) Trades pursuant to a Trading Plan set up in accordance with these Rules.
5. Trading Window
1) The Compliance Officer shall notify a ‘trading window’ during which the Designated Persons may Trade in the Company’s securities after securing pre-clearance from the Compliance Officer in accordance with these Rules.
2) Designated Persons shall not Trade in the Company’s securities when the trading window is closed.
3) Additionally, the trading window shall be closed in particular for a Designated Person or class of Designated Persons when the Compliance Officer determines that a Designated Person or class of Designated Persons can reasonably be expected to have possession of UPSI, for such periods as determined by the Compliance Officer.
4) The trading window may be re-opened after closure, not earlier than 48 hours after the UPSI in question becomes generally available.
6. Pre-clearance of Trading
1) Designated Persons may Trade in the securities of the Company when the trading window is open, after obtaining approval of the Compliance Officer
2) The Compliance Officer shall not approve any proposed Trade by Designated Person if the Compliance Officer determines that such Designated Person is in possession of UPSI even though the trading window is open.
3) The Compliance Officer may, after being satisfied that the application and undertaking are true and accurate, approve Trading by a Designated Person, on the condition that the Trade so approved shall be executed within seven trading days following the date of approval.
4) The Designated Person shall, within two days of the execution of the Trade, submit the details of such Trade to the Compliance Officer.In case the transaction is not undertaken, a report to that effect shall be filed in the said form.
5) If the pre-cleared Trade is not executed within seven trading days after the approval is given, the Designated Person must secure pre-clearance of the transaction again.
6) A Designated Person who Trades in securities without complying with the pre-clearance procedure as envisaged in these Rules or gives false undertakings and/or makes misrepresentations in the undertakings executed by him/her while complying with the pre-clearance procedure shall be subjected to the penalties as envisaged in these Rules.
7) Nothing in this rule shall apply to any Trade involving a value less than Rs 5 Lakhs or such other amount as may be specified by the Board of Directors from time to time (a “de minimis Trade”) provided the Designated Person is not in possession of UPSI while executing the de minimis Trade.
7. Additional trading restrictions on Designated Persons
1) No Director or Key Managerial Personnel shall enter into derivative transactions in respect of the securities of the Company.
2) All Designated Persons who Trade in the securities of the company shall not enter into an opposite transaction during the next six months following the prior transaction. In case of any contra trade be executed, inadvertently or otherwise, in violation of such a restriction, the profits from such trade shall be liable to be disgorged for remittance to the SEBI for credit to the Investor Protection and Education Fund administered by SEBI.
8. Penalty for Insider Trading
1) An Insider who acts in contravention of these Rules shall be liable to have his services or relationship with the Company, as the case may be, terminated.
2) Directors, Officers and employees of the Company who violate these rules shall be subject to disciplinary action by the Company, which may include wage freeze, suspension, and ineligibility for future participation in the Company’s stock option plans or termination.
3) The SEBI or any other appropriate regulatory authority would also be informed of the violation of these Rules so that appropriate action may be taken.
9. Disclosure requirements
1) Initial Disclosure:
a. Every Promoter, Key Managerial Personnel, director of the Company and each of their Immediate Relatives shall disclose his holding of securities of the Company within thirty days of these Rules taking effect.
b. Every person on appointment as a Key Managerial Personnel or a director of the Company or upon becoming a Promoter shall disclose his / her and Immediate Relatives’ holding of securities of the Company as on the date of appointment or becoming a promoter, to the Company within seven days of such appointment or becoming a promoter.
2) Continual Disclosure:
a. Every Promoter, employee, director of the Company and each of their Immediate Relatives shall disclose to the Company the number of such securities acquired or disposed of within two trading days of such transaction if the value of the securities traded, whether in one transaction or a series of transactions over any calendar quarter, aggregates to a traded value in excess of Rs. Ten lakhs.
b. The disclosure shall be made within two working days of:
I. the receipt of intimation of allotment of shares, or
II. the acquisition or sale of shares or voting rights, as the case may be.
3) Disclosure to the Stock Exchange:
The Compliance Officer shall notify the stock exchanges, particulars of the Trades, within two trading days of the receipt of the Continual Disclosure or from becoming aware of such information.
4) Disclosures by other Connected Persons.
The Compliance Officer may, require any other Connected Person to disclose the holdings and trading in securities of the Company at such frequency as he may determine.
1) The Board of Directors shall be empowered to amend, modify, interpret these Rules and such Rules shall be effective from such date that the Board may notify in this behalf.
2) The Compliance Officer shall provide the Audit Committee of the Board, on a quarterly basis, all the details of Trading in securities by the Designated Persons including any violations of the Rules.
3) The Company shall require all Connected Persons to formulate and adhere to a code of conduct to achieve compliance with these Rules. In case such persons observe that there has been a violation of these Rules, then they shall inform the Board of Directors of the Company promptly.
The annexures for communication are made available to all connected persons.