The Board of Directors is responsible for the corporate governance of the Company including its strategic development.

The Board proposed to adopt a formal Corporate Governance charter consistent with the main terms set out below:

Board Responsibilities

The Board will be accountable to the Company Shareholders for the performance of the Company and will have overall responsibility for its operations. Day to day management of the Company's affairs, and the implementation of the corporate strategy and policy initiatives, will be conducted by the Board such time as a managing director is appointed after until which it will be delegated to that person.

The key responsibilities of the Board will include:

• approving the strategic direction and related objectives of the Company and, in due course, monitoring management performance in the achievement of these objectives;
• adopting budgets and monitoring the financial performance of the Company;
• reviewing the performance of the Managing Director (when appointed);
• overseeing the establishment and maintenance of adequate internal controls and effective monitoring systems;
• ensuring all major business risks are identified and effectively managed; and
• ensuring that the Company meets its legal and statutory obligations.

Size and Composition

The Directors consider the size and composition of the Board is appropriate given the size and status of the Company. However, the composition of the Board will be subject to review in a number of ways.

• The Company's constitution provides that at every annual general meeting, one third of the directors shall retire from office but may stand for re-election.
• Board composition will be also reviewed periodically either when a vacancy arises or if it is considered the Board would benefit from the services of a new director, given the existing mix of skills and experience of the Board which should match the strategic demands of the Company. Once it has been agreed that a new director is to be appointed, a search would be undertaken, sometimes using the services of external consultants. Nominations would then be reviewed by the Board.

Conflicts of Interest

In accordance with the Corporations Act and the Company's constitution, the Directors must keep the Board advised, on an ongoing basis, of any interest that could potentially conflict with those of the Company. Where the Board believes that a significant conflict exists, the director concerned will not receive the relevant Board papers, will not be present at the meeting whilst the item is considered, and will take no part in any decision.

Director and Senior Management Dealings in Company Securities

The Company's constitution permits the Directors to acquire securities in the Company. However, the Company policy prohibits directors and senior management from trading the Company's securities at any time whilst in possession of price sensitive information, and for 24 hours after:

• any major announcements;
• the release of the Company's annual financial results to the ASX; and
• the annual general meeting.

Directors must advise the Chairman of the Board before buying or selling securities in the Company. All such transactions will be reported to the Board. In accordance with the provisions of the Corporations Act and the ASX Listing Rules, The Company will advise the ASX of any transaction conducted by the Directors in the Company's securities.

Board Committees

The Board of Directors takes ultimate responsibility for corporate governance including the functions of:

• establishing compensation arrangements of the Managing Director and its senior executives and officers;
• appointment and retirement of non-executive directors;
• appointment of auditors;
• areas of business risk;
• maintenance of ethical standards; and
• audit committee.

The Board seeks independent professional advice as necessary in carrying out their duties and responsibilities.

Continuous Disclosure

The Company has a policy that all the Company shareholders and investors have equal access to the Company's information. The Chairman of the Board ensures that all price sensitive information is disclosed to the ASX in accordance with the continuous disclosure requirements of the Corporations Act and the ASX Listing Rules. The company secretary has primary responsibility for all communications with the ASX.

Code of Ethics

The Directors, management and staff are expected to perform their duties for the Company in a professional manner and act with the utmost integrity and objectivity, striving at all times to enhance the reputation and performance of the Company.

Shareholder Communication

The Board of Directors aim is to ensure that the Shareholders will be informed of all major developments affecting the Company's state of affairs. Information will be communicated to the Shareholders in the following forms:

• the annual report will be distributed to all Shareholders (unless a Shareholder has specifically requested not to receive the document);
• the half-yearly report will contain summarised financial information and a review of the operations of the Company during the period (the financial report will be sent to any Shareholder who requests it);
• the ASX quarterly cash reports will contain summarised financial information and a review of operations of the Company during the relevant period; and
• notices of all meetings of the Company.