Remuneration Committee

The Board appointed a Remuneration Committee on 31 August 2010 comprised of three Directors and adopted the following Terms of Reference applicable to the Remuneration Committee.

Members:  
Gordon Galt – Non-executive/Independent – Chairman
Charles Bass – Non-executive
Derek Cowlan – Non-executive/Independent


TERMS OF REFERENCE

          General

  1. The Remuneration Committee (the “Committee”) of the Board is a committee established under Rule 8 of the Company’s Constitution.
  2. The role of the Committee is to assist the Board of Directors of the Company (the “Board”) in exercising its authority in relation to the matters referred to below and is accountable to the Board for its performance.

    3. Membership, Attendance at Meetings and Proceedings

  3. The Committee shall be appointed by the Board and shall comprise not less than three non-executive directors of the Company the majority of whom shall also be independent.
  4. The chairman of the Committee (the “Chairman”) shall be a non-executive independent director appointed by the Board.  In the Chairman’s temporary absence, one of the other independent non-executive members nominated by the Chairman or elected by the other members of the Committee will act as chairman.
  5. The Company Secretary of Aquila Resources Limited (the “Secretary”) shall be the secretary of the Committee and a quorum shall be two members.
  6. If members are unavailable for a particular meeting, any two members shall be entitled to co-opt a non-executive director if that is necessary to constitute a quorum.
  7. The Committee shall meet not less than three times a year and at such other times as any member of the Committee shall require.
  8. Any Committee member or the Secretary may call a meeting of the Committee or may request a member to call a meeting.
  9. A notice of each meeting confirming the date, time, venue and agenda shall be forwarded to each member of the Committee (with a copy to all Board members) in the week prior to the meeting.  The notice to members will include relevant supporting papers for the agenda items to be discussed.
  10. Other directors, excluding those falling within paragraph (14) below, are entitled to attend Committee meetings.  Any eligible non-member director wishing to attend will notify the Secretary and ask for the papers, which will then be sent.
  11. The Chief Executive Officer may be invited to attend, to discuss proposals relating to other directors and employees whose remuneration is to be reviewed by the Committee.
  12. Proceedings and meetings of the Committee will be governed by the Constitution of the Company for regulating the meetings and proceedings of the Board in so far as they are applicable and not inconsistent with these terms of reference.

    13. Duties and Authority

  13. To review the framework of remuneration for executive directors and its cost, and make recommendations to the Board.
  14. To determine the terms of service, including remuneration, for:
    (a) the Chief Executive Officer
    (b) any director of Aquila Resources Limited who is also a salaried employee of the company or any subsidiary;
    (c) any General Manager who is not an executive director of Aquila Resources Limited or any of its subsidiaries.
  15. To confirm management’s approach to remuneration and employment conditions strategy for any other employee of the Aquila Resources Limited Group.
  16. To review any termination arrangements for those mentioned in (14) above.
  17. To review remuneration by gender within the Aquila Resources Limited Group.
  18. To recommend share based long term incentive plans, or the discontinuance of existing plans, to the Board.
  19. To recommend to the Board proposals for granting and, when necessary, the exercise of share options under share option schemes.
  20. To ensure that the Company’s remuneration policy is consistent with management’s approach to developing future leaders.
  21. To report on these matters and on any other matters referred to it by the Chief Executive Officer of the Company or the Board, at the first convenient Board meeting following the Committee’s decision.
  22. To submit to the Board a draft of the Remuneration Report required to be included in the Company’s Annual Report and financial statements by relevant Australian legislation and regulation.
  23. To ensure the Company’s compliance with applicable legal and regulatory requirements associated with remuneration matters.
  24. To communicate with shareholders on remuneration policy and the Committee’s work on behalf of the Board.
  25. The Committee is authorised by the Board to investigate any activity within its terms of reference.  The Committee is a non-executive Committee and is tasked with recommending to the Board appropriate actions emanating from those investigations.
  26. The Committee shall have unrestricted access to personnel, records and senior management of the Company, as appropriate.
  27. The Committee is authorised by the Board to obtain outside legal or other independent professional advice in respect of any matter relating to the terms of reference including without limitation, in respect of remuneration design and may obtain external and internal remuneration surveys and secure the attendance of outsiders with relevant experience and expertise, if it considers this necessary.  The cost of such advices will be borne by the Company.

    28. Annual General Meeting

  28. The Committee’s Chairman will attend the Annual General Meeting and be prepared to respond to any shareholder questions on the Committee’s activities.Fifth point