Patties Foods : Notice of Annual General Meeting (Nov-15) (Link)

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Patties Foods Ltd‌‌‌ ABN 62 007 157 182 Operations Corporate Office 161-169 Princes Highway Chifley Business Park Bairnsdale VIC 3875 Level 2, 1 Joseph Avenue
PO Box 409 Bairnsdale V Phone: Admin Fax: Sales Fax: info@patties www.patties.	Mentone VIC 3194 IC 3875 PO Box 115 03 5150 1800 Dingley VIC 3172 03 5152 1135 Phone: [phone] 03 5152 1054 Fax : [phone] .com.au [e-mail] com.au www.patties.com.au

16 October 2015

Announcements Officer ASX Limited

South Rialto Tower 525 Collins Street

MELBOURNE VIC 3000

Notice of Annual General Meeting

In accordance with the Listing Rules, I attach the following documents in relation to the 2015 Annual General Meeting that will be sent to shareholders today:

1. Chairman's letter

2. Notice of Annual General Meeting and Explanatory Memorandum

3. Appointment of Proxy

4. Annual Report for 2015 (if elected*)

5. Shareholder Questionnaire

The attached documents will also be made available on our website, www.pattiesfoods.com.au, once released to the market.

Yours sincerely

CLINTON ORR

Company Secretary

Patties Foods Ltd

ABN 62 007 157 182

*I00000101*

MR SAM SAMPLE FLAT 123

123 SAMPLE STREET THE SAMPLE HILL SAMPLE ESTATE SAMPLEVILLE VIC 3030

Operations

161-169 Princes Highway

Bairnsdale VIC 3875

PO Box 409

Bairnsdale VIC 3875

Phone: [phone]

Admin Fax: [phone]

Sales Fax: [phone] [e-mail] www.patties.com.au

Corporate Office

Chifley Business Park Level 2, 1 Joseph Avenue

Mentone VIC 3194

PO Box 115

Dingley VIC 3172

Phone: [phone]

Fax: [phone]

[e-mail] www.patties.com.au

16 October 2015

Dear Shareholder,

On behalf of the Board of Patties Foods Limited ('PFL'), it gives me great pleasure to invite you to the ninth Annual General Meeting of PFL to be held at 2.00 p.m. on Thursday, 19 November 2015 in Boardrooms

1 and 2 at Minter Ellison Lawyers, level 23, 525 Collins Street, Melbourne, Victoria 3000. Please find enclosed the following documents in relation to the Annual General Meeting:

1. Notice of Annual General Meeting and Explanatory Memorandum.

2. Appointment of Proxy.

3. Annual Report for 2015 (if elected*).

4. Shareholder Questionnaire.

If you are unable to attend in person, you are encouraged to vote using the enclosed Proxy form. Please read the Proxy form for instructions about completing the form and returning it by no later than 2.00 p.m. (Melbourne time) on Tuesday, 17 November 2015.

Should you have any questions in relation to the enclosed documents, please contact the share registry,

Computershare Investor Services on Ph: 1300 850 505 (within Australia) or [phone] (outside Australia).

I look forward to meeting as many of you as possible at the annual general meeting. Yours sincerely,

Mark Smith Chairman

*For those that have elected not to receive a hard copy of the Annual Report, it is available at www.pattiesfoods.com.au.

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Australia's Favourite Food

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NOTICE OF MEETING 2015

NOTICE IS GIVEN that the 2015 Annual General Meeting

of Patties Foods Limited (Company) will be held at 2:00 p.m. (Melbourne time) on Thursday, 19 November 2015 in Boardrooms 1 and 2 at Minter Ellison Lawyers, Level 23, 525 Collins Street,

Melbourne, Victoria 3000.

DIRECTIONS

Foot traffic - enter from Collins Street and take lift to Level 23, South Tower Private vehicles - enter Rialto Car Park via Flinders Lane (parking fees apply)

ORDINARY BUSINESS Receipt of Accounts and Reports

To receive and consider the Company's Financial Report for the financial year ended 30 June 2015, together with the Directors' Report and the Auditor's Report, all of which are contained in the Company's Annual Report. An electronic copy of the Company's Annual Report is available on the Company's website, www.pattiesfoods.com.au.

Note: This item of business does not require Shareholders to vote on a resolution or adopt the received reports.

Resolution 1: Adoption of the Remuneration Report

To consider and, if thought fit, pass the following resolution:

'That, for the purpose of section 250R(2) of the Corporations Act, the Company's Remuneration Report for the financial year ended 30 June 2015 is adopted.'

Note: The vote on this resolution is advisory only and does not bind the Directors or the Company.

Resolution 2: Re-election of Mr John Schmoll as a Director

To consider and, if thought fit, pass the following resolution:

'That Mr John Schmoll who retires from office in accordance with the Constitution and, being eligible for re-election, offers himself for election, is re-elected as a Director'.

Resolution 3: Re-election of Mr Curt Leonard as a Director

To consider and, if thought fit, pass the following resolution:

'That Mr Curt Leonard who retires from office in accordance with the Constitution and, being eligible for re-election, offers himself for election, is re-elected as a Director'.

SPECIAL BUSINESS Resolution 4: Approval of the Company's Long Term Incentive Plan

To consider and, if thought fit, pass the following resolution:

'That for the purpose of Exception 9 to ASX Listing Rule 7.1 in ASX Listing Rule 7.2 and for all other purposes, the Patties Foods Limited Long Term Incentive Plan is approved as an exception to ASX Listing Rule 7.1.'

Resolution 5: Grant of Performance Rights to Mr Steven Chaur under the Company's Long Term Incentive Plan

To consider and, if thought fit, pass the following resolution:

'That, for the purposes of ASX Listing Rule 10.14 and for all other purposes, the grant to Mr Steven Chaur of 248,571 performance rights to acquire shares in the Company pursuant to the terms of the Patties Foods Limited Long Term Incentive Plan is approved.'

Resolution 6: Approval of termination benefits

To consider and, if thought fit, pass the following resolution:

'That for the purposes of section 200B and 200E of the Corporations Act, approval is given to the giving to the Managing Director and the senior executives of the Company referred to in the Explanatory Memorandum accompanying and forming part of the notice of this meeting of the benefits in connection with retirement from office or position of employment in the Company or a related body corporate, details of which

are set out in that Explanatory Memorandum.'

By order of the Board

Mr Clinton Orr Company Secretary 16 October 2015

VOTING BY PROXY A PROXY FORM is enclosed with this Notice of Meeting

• A member entitled to attend and vote at the Annual General Meeting ('AGM') may appoint a proxy. A form for the appointment of a proxy is enclosed with this Notice of AGM.

• A member entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If a member appoints two proxies and the appointment does not specify the proportion or number of the member's votes each proxy may exercise, each proxy may exercise half of the votes (any fractions will be disregarded).

• If a member appoints two proxies, neither may vote on a show of hands.

• A proxy may be an individual or a body corporate.

• A person appointed as proxy need not be a member of the Company.

• To be valid, the proxy form and the power of attorney or other authority (if any) under which it is signed, or a certified copy of any such power of attorney or other authority, must be:

  • deposited at the Share Registry of the Company, Computershare Investor Services Pty Ltd located at Yarra Falls, 452 Johnston Street, Abbotsford, Victoria 3067;

  • received by post to the Share Registry of the Company, Computershare Investor Services Pty Ltd, GPO Box 242, Melbourne Victoria 3001;

  • successfully transmitted by facsimile to the Share Registry of the Company on 1800 783 447 (within Australia) or [phone];

  • for online voting, refer to www.investorvote.com.au;

  • relevant custodians may lodge their proxy forms online by visiting www.intermediaryonline.com; or

  • deposited at or received by post to the registered office of the Company, at 161-169 Princes Highway, Bairnsdale, Victoria 3875, not less than 48 hours before the commencement of the meeting or any resumption of the meeting following an adjournment.

    
    

    CORPORATE REPRESENTATIVES

• A body corporate appointed as a proxy will need to appoint a representative to exercise the powers that body corporate may exercise as the member's proxy pursuant to section 250D of the Corporations Act. If a representative of a corporate member or proxy is to attend the meeting, a certificate of appointment of the representative must be produced prior to admission to the meeting.

• The form of a certificate of appointment can be obtained from the Share Registry of the Company, Computershare Investor Services Pty Ltd by visiting www.investorcentre.com under the help tab, 'Printable Forms'.

  
  

  VOTING ENTITLEMENTS

• The Directors have determined that the Shareholding of each Shareholder for the purposes of ascertaining the voting entitlements for the AGM will be as it appears in the share register of the Company, as held by Computershare Investor Services Pty Ltd, as at 7:00 p.m. (Melbourne Time) on Tuesday, 17 November 2015.

  Transactions recorded after that time will be disregarded in determining Shareholder entitlements to attend and vote at the AGM.

  Voting exclusions and restrictions Resolution 1: Adoption of the Remuneration Report

  The Company will disregard any votes cast on Resolution 1 by or on behalf of:

• a member of the Company's key management personnel, details of whose remuneration are included in the Company's Remuneration Report ('KMP'); or

• a closely related party of a KMP,

  whether the votes are cast as a shareholder, proxy or in any other capacity.

  However, the Company will not disregard a vote cast by a KMP or closely related party of a KMP if:

• the vote is cast as a proxy;

• either:

  • the proxy is appointed by writing that specifies how the proxy is to vote on Resolution 1; or

  • the proxy is the chairman of the meeting and the proxy appointment:

    > does not specify the way the proxy is to vote on the resolution; and

    > expressly authorizes the chairman to exercise the proxy even if the resolution is connected directly or indirectly with the remuneration of a member of the key management personnel of the Company's consolidated entity; and

• the vote is not cast on behalf of a KMP or a closely related party of a KMP.

  If you are a member of the KMP or a closely related party of a member of the KMP (or are acting on behalf of any such person) and purport to cast a vote that will be disregarded by the Company (as described above), you may commit an offence by breaching the voting restrictions that apply to you under the Corporations Act.

  A closely related party of a member of the KMP means any of the following:

• a spouse or child of the member;

• a child of the member's spouse;

• a dependant of the member or of the member's spouse;

• anyone else who is one of the member's family and may be expected to influence the member, or be influenced by the member, in the member's dealings with the entity; or

• a company the member controls.

  
  

  Resolutions 4 and 5: Approval of Long Term Incentive Plan and grant of performance rights to Mr Steven Chaur

  The Company will disregard any votes cast on Resolution 4 or 5 by:

• Mr Steven Chaur (being the only director of the Company eligible to participate in the Patties Foods Limited Long Term Incentive Plan); and

• An associate of Mr Steven Chaur.

  However, the Company need not disregard a vote on Resolution 4 or 5 if:

• it is cast by a person as proxy for a person entitled to vote, in accordance with the directions on the proxy form; or

• it is cast by the chairman of the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides, even if the Resolution is connected directly or indirectly with the remuneration of a member of the key management personnel for the Company's consolidated entity.

  
  

  Resolution 6: Approval of termination benefits

  The Company will disregard any votes cast on Resolution 6 by:

• Mr Steven Chaur; or

• any senior executive of the Company in respect of whom benefits are the subject of Resolution 6 (Relevant Executive); and

• any associate of any of the above persons.

  However, the Company need not disregard a vote on the Resolution if:

• it is cast by a person as a proxy for a person who is entitled to vote appointed by writing that specifies how the proxy is to vote on the Resolution; or

• it is cast by the chairman of the meeting as proxy for a person who is entitled to vote and the proxy appointment expressly authorizes the chairman to exercise the proxy even if the Resolution is connected directly or indirectly with the remuneration of a member of the key management personnel for the Company's consolidated entity.

  APPOINTING THE CHAIRMAN OF THE MEETING AS PROXY

  The proxy form accompanying this Notice contains detailed instructions regarding how to complete the proxy form if a shareholder wishes to appoint the Chairman as his or her proxy. You should read those instructions carefully.

  By appointing the chairman of the meeting as your proxy in relation to Resolution 1, 4, 5 or 6 you expressly authorise the chairman to exercise the proxy even if the resolution is connected directly or indirectly with the remuneration of a member of the key management personnel of the Company's consolidated entity.

  The chairman of the meeting intends to exercise all available proxies by voting in favour of all resolutions.

  
  

  EXPLANATORY MEMORANDUM TO THE NOTICE OF ANNUAL GENERAL MEETING

  This Explanatory Memorandum accompanies and forms part of the notice of meeting dated 16 October 2015 ('Notice').

  
  

  Ordinary Business Consideration of Accounts and Reports

  The Corporations Act requires the Financial Report, the Directors' Report and the Auditor's Report (together, 'Reports') to be considered at the AGM. There is no requirement in the Corporations Act or the Constitution for Shareholders to vote on, approve or adopt the Reports.

  Shareholders will have a reasonable opportunity at the AGM to ask questions about or make comments on the Reports and on the business, operations and management of the Company.

  By law, the Auditor (PricewaterhouseCoopers) is required to attend the AGM. Prior to the AGM, Shareholders who are entitled to cast a vote at the AGM may forward written questions to the Auditor for response by the Auditor at the AGM if such questions are relevant to:

• the content of the Auditor's Report; or

• the conduct of the audit of the Financial Report.

  
  

  All such written questions for the Auditor must be submitted by returning the enclosed 'Questions from Shareholders' Form by no later than 5:00 p.m. on 12 November 2015 (pursuant to section 250PA of the Corporations Act). The enclosed Form sets out the details regarding how the Form should be submitted to the Company's Share Registry, Computershare Investor Services Pty. Ltd.

  The Company is required by section 250PA(3) of the Corporations Act to forward all such written questions to the Auditor, and the Auditor will prepare a list of questions that the Auditor considers to be relevant to the content of the Auditor's Report and the conduct of the audit of the Financial Report. The Auditor may omit questions that are the same in substance as other questions and questions that are not received in

  a timely manner. At the AGM the Chairman will give the Auditor a reasonable opportunity to answer the questions on the question list. The Company will make the list of questions prepared by the Auditor available on the Company's website.

  At the AGM, the Auditor will be available to take Shareholders' questions relevant to the conduct of the audit, the preparation and content

  of the Auditor's Report, the accounting policies adopted by the Company in relation to the preparation of the financial statements (contained in the Financial Report), and the independence of the Auditor in relation to the conduct of the audit.

  
  

  Resolution 1: Adoption of the Remuneration Report

  In accordance with the Corporations Act, Resolution 1 puts to the vote of Shareholders at the AGM that the Company's Remuneration Report be adopted.

  The vote on Resolution 1 is advisory only and does not bind the Directors of the Company or the Company. However, if at least 25% of the votes cast on the resolution are against adoption of the Remuneration Report at the meeting, then:

• if comments are made on the Remuneration Report at the AGM, the Company's remuneration report in respect of the financial year ending on 30 June 2016 will be required to include an explanation of the Board's proposed action in response to those comments or, if no action is proposed, the reasons why; and

• if, at the Company's annual general meeting in 2016, at least 25% of the votes cast on the resolution for adoption of the remuneration report are against its adoption, the Company will be required to put to Shareholders a resolution proposing that a general meeting (Spill Meeting) be held within 90 days to consider the election of directors of the Company (Spill Resolution). The Spill Meeting must be held within

  90 days of the date of the 2016 annual general meeting. If more than 50% of the votes cast on the Spill Resolution are in favour of the Spill Resolution, the Spill Resolution will be passed and all of the directors in office at the 2016 annual general meeting (other than the managing director) will cease to hold office immediately before the end of the Spill Meeting, unless they are re-elected at the Spill Meeting.

  The Remuneration Report forms part of the Directors' Report, contained in the Annual Report. Each of the Directors recommends the Remuneration Report to Shareholders for adoption.

  An opportunity will be provided for discussion of the Remuneration Report at the AGM.

  Resolution 2: Re-election of Mr John Schmoll as a Director.

  The Constitution provides that if the Company has 3 or more Directors, one third of Directors (rounded down to the nearest whole number and excluding the Managing Director) must retire at each AGM of the Company. As at the date of this Explanatory Memorandum there are 7 incumbent Directors, 2 of whom, other than the managing director, must retire (and are eligible for re-election) at this AGM.

  The 2 retiring Directors are Messrs John Schmoll and Curt Leonard each of whom is standing for re-election at this AGM.

  Mr John Schmoll (who is a non-executive Director) must retire, and is eligible for re-election, at this AGM as a Director, pursuant to Listing Rule 14.4 and Articles 6.3(b) and 6.3(f) of the Constitution.

  Mr John Schmoll was Chief Financial Officer of Coles Myer Ltd until his retirement from that role in 2002. He was a director of Breville Group Ltd for 9 years, including 7 years as Chairman, until his retirement as a director in 2013. Since 2005, Mr John Schmoll has been a Non-Executive Director of Oroton Group Ltd and in 2013 was appointed Chairman. Mr John Schmoll previously served as a Non-Executive Director and chairman of the audit committee of AWB Ltd, Australian Leisure and Hospitality Group Ltd, Golden Circle Ltd and Chandler Macleod Ltd.

  Mr John Schmoll has an extensive background, at both executive and non-executive levels, in the retail, distribution and consumer product sectors. He has extensive knowledge in finance, accounting, capital management, debt/equity markets, strategic planning and corporate governance.

  The Board (other than Mr John Schmoll, who abstains given his personal interest in this Resolution) unanimously recommends that Shareholders vote in favour of Resolution 2.

  Resolution 3: Re-election of Mr Curt Leonard as a Director.

  Mr Curt Leonard (who is a non-executive Director) must retire, and is eligible for re-election, at this AGM as a Director, pursuant to Listing Rule 14.4 and Articles 6.3(b) and 6.3(f) of the Constitution.

  Mr Curt Leonard has been a non-executive director of the Company since 2003, he has over 31 years experience working with the Mars Group, including General Manager of Mars Confectionery, Managing Director of Uncle Bens and Managing Director of Mars Australia and New Zealand. Mr Leonard served as President, Asia Pacific of all Mars business and Director of the Managing Board of Mars Incorporated global business.

  Mr Curt Leonard previously served as a non-executive director of Select Harvests Limited from 2004 until 2008, and served as chairman of Select Harvests Limited from 2008 until 2012.

  Since being appointed as a Director of Patties Foods Limited, Mr Curt Leonard has the special responsibility as a Member of the remuneration and nomination committee.

  The Board (other than Mr Curt Leonard, who abstains given his personal interest in this Resolution) unanimously recommends that Shareholders vote in favour of Resolution 3.

  Special Business Resolution 4: Approval of the Company's Long Term Incentive Plan

  Resolution 4 is proposed for the purpose of Exception 9 in ASX Listing Rule 7.2.

  If Resolution 4 is passed, this will have the effect that any securities (that is options or performance rights) granted under the Long Term Incentive Plan ('Plan') after the date the Resolution is passed will not be counted for the purpose of the Company's 15% security placement limit under ASX Listing Rule 7.1.

  In brief, Listing Rule 7.1 prohibits a listed company from issuing shares or other securities such as options or rights in excess of 15% of its existing shares unless an exception applies. The effect of the passing of Resolution 4 is that any grant of rights or options under the Plan in the period of 3 years after the Resolution is passed will be excepted from the 15% limit. The Resolution will apply to the performance rights proposed to be granted under the Plan to Mr Steven Chaur, but will not apply to the performance rights granted in September 2015 to the Relevant Executives.

  The Plan has been in place since the Company's listing on ASX in 2006 and was approved for the purpose of Exception 9 at the Company's AGM in November 2012. A total of 713,757 performance rights have been granted under the Plan to the Relevant Executives in September 2015 which remain outstanding, including the 248,571 performance rights proposed to be granted to Mr Steven Chaur subject to the passing of Resolution 5. 1,151,263 performance rights have been granted under the Plan which remain outstanding.

  A summary of the terms of the Plan is as follows.

  
  

  General

  The Plan is intended to retain and motivate the Company's management team.

  Under the Plan, the Board has the discretion to grant options and performance rights to Eligible Employees (which includes executive Directors) of the Company or a related body corporate.

  Both options and performance rights give a participant in the Plan a right to acquire shares in the Company subject to the achievement

  of both time based and performance based vesting conditions, with options requiring the payment of an exercise price to acquire the shares and a performance right not requiring the payment of an exercise price.

  The Board has the discretion to amend the rules of the Plan but not so as to reduce the rights of participants, except where necessary to correct obvious errors or mistakes or to comply with legal requirements or where agreed by the participant.

  Awards under the Plan are made at the Board's discretion.

  
  

  Eligibility

  The rules allow for offers under the Plan to be made to any employee of the Company or a related body corporate, including executive directors, or such other person as the Board determines. However, it has been the case and it is currently intended to continue to be the case that participation in the Plan will only be offered to the Company's leadership team.

  
  

  Grant of options and rights

  Options and rights may be granted under the Plan subject to vesting conditions, including time and performance based hurdles.

  The Board determines the details of the vesting conditions attaching to options and rights under the Plan prior to offers of participation being made. Options or rights will only vest (under normal circumstances) upon satisfaction of the time and performance based vesting conditions. If those conditions are not met, the options or rights will generally expire and not be capable of exercise.

  No amount is payable on the grant of options or performance rights offered under the Plan.

  
  

  Delivery of shares

  Shares in the Company will be delivered to participants upon exercise of vested options or performance rights. On exercise, the Company

  may deliver shares by new issue or by purchasing shares on market for transfer to participants. The exercise price of the options is determined by reference to the 5 day volume weighted average price of shares in the Company as traded on ASX in the 5 days up to and including the date of grant. No exercise price is payable on the exercise of performance rights.

  
  

  Change of control

  On a change of control of the Company, the board has discretion to waive the vesting conditions applicable to unvested options and rights, subject to such terms and conditions as it determines.

  Cessation of employment

  If a participant holding fully vested options ceases employment with the Company or a related body corporate (other than in the case of fraud, defalcation or gross misconduct), then to the extent permitted by the termination benefits provisions of the Corporations Act, participants will have a period of 30 days from employment ceasing in which to exercise the options. Any options not exercised within this period will expire unless the Board in its absolute discretion determines otherwise.

  If a participant ceases to be employed by the Company or a related body corporate, for reason of death, permanent disability, redundancy, retirement or any other reason at the discretion of the Board, before vesting, the Board has the discretion to determine, subject to the termination benefits provisions of the Corporations Act, whether any unvested options or performance rights can be exercised subject

  to such terms and conditions as it determines.

  Where the employment ceases for any other reason, entitlement to any unvested options or performance rights will ordinarily expire on cessation of employment.

  
  

  Plan limits

  Issues of shares on exercise of options or performance rights granted under the Plan will be subject to a cap of 5% of the issued share capital of the Company, inclusive of shares that may be issued under other employee incentive schemes of the Company for employees and non-executive directors, but disregarding offers made outside of Australia, made under a prospectus or other disclosure document or which do not require a disclosure document.

  
  

  Expiry of options and performance rights

  Unless otherwise determined by the Board in its discretion, options and performance rights which have not been exercised will expire and cease to exist on the expiry date specified at the date of grant or upon the Board making a determination that the options or performance rights are to be forfeited.

  
  

  Restrictions on shares and forfeiture conditions

  Options, and performance rights and shares delivered on exercise, may be subject to forfeiture (subject to lifting at the discretion of the Board) if a participant commits any act of fraud, defalcation or gross misconduct in relation to the Company or a related body corporate. Shares delivered on exercise may be subject to disposal restrictions (subject to removal at the discretion of the Board).

  
  

  Hedging economic exposure prohibited

  Without limiting the prohibitions in Part 2D.7 of the Corporations Act (ban on hedging remuneration of key management personnel), the terms of the Plan prohibit entering into transactions or arrangements which limit the economic risk of participating in unvested entitlements under the Plan.

  
  

  Interaction with securities trading policy

  The exercise of any options or performance rights is timed so that they do not occur during any closed period under the Company's securities trading policy.

  
  

  Previous grants under the Plan

  The number of securities issued under the Plan since the date of the last approval in 2012 is:

• 1,828,757 performance rights,

  of those 677,494 performance rights have lapsed, and 1,151,263 performance rights remain outstanding as at the date of the notice of meeting.

  Resolution 5: Grant of Performance Rights to Mr Steven Chaur under the Company's Long Term Incentive Plan

  ASX Listing Rule 10.14 provides that the Company must not permit a Director or an associate of such a Director to acquire securities under an employee incentive scheme without prior approval of Shareholders. Accordingly, approval is sought pursuant to Listing Rule 10.14 for the grant of 248,571 performance rights (Rights) to Mr Steven Chaur on the terms of the Company's Long Term Incentive Plan (Plan).

  Key terms of performance rights

  The key terms of the Rights proposed to be granted to Mr Steven Chaur are as follows:

• Share entitlement

  Absent any restructure of the Company's share capital, each Right confers the right on vesting, to one fully paid ordinary share in the Company.

  
  

• Consideration for the Rights

  The Rights will be granted for nil consideration.

  
  

• Vesting

  The relevant number of Rights will be tested following the end of the Performance Period 1 July 2015 to 30 June 2018, and vest to the extent that the Performance Hurdles have been satisfied and also subject to continued employment with the Company.

  
  

• Performance Hurdles

  Vesting of the Rights is dependent on two discrete performance measures:

• EPS representing 50% of the total grant; and

• TSR representing 50% of the total grant.

  
  

• Vesting Schedule

• EPS Vesting Schedule

  EPS (basic earnings per share on a normalised basis) performance of the Company will be measured on a compound annual growth in EPS of the Group over the relevant 3 year Performance Periods stated as a percentage (EPS Growth Percentage). If the EPS Growth Percentage over the relevant Performance Period is:

• less than 8% per annum, no Rights subject to the EPS performance measure (EPS Rights) will vest;

• 8% per annum, 50% of the EPS Rights will vest;

• 12% per annum or more, 100% of the EPS Rights will vest; or

• greater than 8% per annum but less than 12% per annum, the number of EPS Rights that vest will be determined proportionately on a straight line basis from 50% to 100%.

The Board may in its discretion adjust the required EPS Growth Percentage to take into account events including without limitation, acquisitions or disposals of businesses or capital assets by the Company during the Performance Period.




• TSR Vesting Schedule

TSR of the Company will be measured against selected companies within the 'Consumer Staples' GICS Sector, 'Food and Staples' GICS Industry Group and 'Food, Beverage and Tobacco' GICS Industry Group with a market capitalisation relevant to Patties' market capitalisation at the grant date. The Board may in its discretion adjust the comparator group to take into account events including without limitation takeovers, mergers, delistings or demergers that occur during the Performance Period. If relative TSR performance of the Company against the comparator group is:

1. below median performance, no Rights subject to the TSR performance measure (TSR Rights) will vest;

2. at median performance, 50% of the TSR Rights subject to TSR will vest;

3. above median performance but below the 75th percentile, an additional 2% (or part thereof) of the TSR Rights will vest for each 1 percentile increase (or part thereof) above the 50th percentile; or

4. at or above the 75th percentile, 100% of the TSR Rights will vest.




6 Other information

To date, the persons who are entitled to participate in the Long Term Incentive Plan include employees of the Company or a Related Company, including executive Directors, or such other person as the Board, in its discretion, determines.

Mr Steven Chaur is the only current director of the Company who has been offered performance rights under the Plan. No other director of the Company is an executive director and therefore currently eligible to participate in the Plan.

No directors have received performance rights under the Plan since the Plan was last approved on 22 November 2012. No loan is proposed in connection with the acquisition of the Rights.

Subject to this resolution being passed, the Rights to be granted to Mr Steven Chaur will be granted shortly after the date of this meeting. If the Rights are granted in accordance with the resolution, the Company will record the effective date of grant of the Rights for reporting purposes as 30 September 2015.

Resolution 6: Approval of termination benefits

Introduction

Under section 200B of the Corporations Act, a company may only give a person a benefit in connection with their ceasing to hold a managerial or executive office in the company or a related body corporate if the giving of the benefit is approved by shareholders or an exemption applies.

Approval is sought in respect of the 248,571 Rights proposed to be granted to Mr Steven Chaur and the following Relevant Executives who were granted the following number of performance rights under the Plan in September 2015:

• Denis Gerrard - 98,209

• Jeff Pentney - 81,734

• Stuart Smyth - 70,560

• Bethaney George - 78,459

• Greg Wharton - 70,408

• Steve Beauchier - 65,816

Accelerated vesting of performance rights

Consistent with the Plan there are, subject to any necessary shareholder approval, certain vesting acceleration events applicable to the Rights proposed to be granted to the Managing Director and granted to the Relevant Executives on certain types of termination of employment, excluding resignation or dismissal for cause, (in which event the performance rights lapse) as well as on certain changes of control of the Company (Acceleration Event).

Upon the happening of an Acceleration Event, regardless of the time and performance hurdles otherwise applying under the Plan, accelerated vesting of the Rights may occur. The number of Rights that vest will be determined by the board in its discretion taking into account:

1. the elapsed relevant performance period as at the date of cessation of employment; and

2. the extent to which the relevant performance hurdles have been satisfied as at the date of cessation.

The Corporations Act may (in general terms) prohibit the Company from providing the benefit of Shares on the accelerated vesting of Rights granted or to be granted to the Managing Director and the Relevant executives following an Acceleration Event (the value of that benefit being the Acceleration Benefit). The value of the Acceleration Benefit, when combined with the Managing Director's and Relevant Executive's existing termination benefits (Existing Benefits) payable in cash, may cause the combined termination benefit (including the Acceleration Benefit and Existing Benefits) to exceed the limit permitted under the Corporations Act without shareholder approval. Broadly the limit is prescribed as the average annual base salary of the Relevant Executive.

Approval is sought for Acceleration Benefits for 3 years

Approval in relation to Acceleration Benefits will apply in relation to options and performance rights granted under the Plan to the Managing Director and Relevant Executives prior to the date Resolution 6 is passed and any other rights or options granted under the Plan in the period ending on the 3rd anniversary of that date.

This period is intended to align with the period in which approval of the Plan through the passing of Resolution 4 is effective for the purposes of providing an exception to the 15% placement limit in Listing Rule 7.1.

Approval is also being sought for the following Existing Benefits

In addition to shareholder approval of Acceleration Benefits for the Managing Director and Relevant Executives shareholder approval is also being sought under sections 200B and 200E of the Corporations Act for any Existing Benefits that may be provided under the relevant employment agreement. These are in addition to any payments or benefits that may be provided which are exempted from the operation

of section 200B such as statutory entitlements to accrued annual and long service leave, any amounts required to be paid by law and certain deferred bonuses.

Resolution 6 is proposed to obtain shareholder approval to provide the Managing Director and each Relevant Executive termination benefits comprising both the Acceleration Benefits and the Existing Benefits.

Existing Benefits are not new benefits

Note, the only new benefits for which approval is being sought are the Acceleration Benefits. The Existing Benefits are not new benefits. No change to the underlying employment arrangements or individual entitlements is being proposed. The approval sought in relation to the

Existing Benefits is in relation to the Company's existing contractual obligations to the Managing Director and each of the Relevant Executives, and to enable the Company to operate its remuneration program for its key management personnel.

The Existing Benefits are described in the Company's remuneration report.