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Corporate Governance

RENUMERATION COMMITTEE GUIDELINES

Terms of Reference

  • To advise the Board with regard to the Company's broad policy for executive remuneration.
  • To determine, on behalf of the Board, the individual remuneration packages for each Executive Director and, as appropriate, other senior executives.
  • To give the Executive Directors encouragement to enhance the Company's performance and to ensure that they are fairly, but responsibly, rewarded for their individual contribution.

General Duties

  • Consult the Company Chairperson and Chief Executive Officer about any proposals.
  • Have access to professional advice, internally and externally.
  • The Chairperson should be able to attend Directors meetings and the AGM and be prepared to answer questions about directors remuneration.

Duties with Regard to Remuneration Policy

  • The committee should propose packages to attract, retain and motivate Executives, but avoid paying more than is necessary.
  • The committee should judge where to position the Company relative to other companies and be aware of comparable company pay, but exercise caution.
  • The committee should be sensitive to the wider scene, especially with regard to salary increases.
  • The committee should ensure that performance related elements should form a significant proportion of the package; should align interests with those of the shareholders; and should provide keen incentives.
  • The committee should consider whether Directors should be eligible for annual bonuses. If so, must include performance conditions; and consider upper limits and part payment in shares.
  • The committee should consider whether Directors should participate in long-term incentive schemes. Different types of schemes must be weighed against each other. Vesting should normally be deferred for at least 3 years.

General Requirements

  • New long-term incentive schemes may need approval of shareholders.
  • Payouts or grants under all incentive schemes including new grants under existing share option schemes should be subject to challenging performance criteria reflecting the company's objectives. Measuring performance relative to a comparative group of companies should be considered.
  • Long term incentive awards/grants should be phased.

NOMINATIONS COMMITTEE CHARTER

Objective

To consider and make recommendations for Willhart Limited on the composition of , and criteria for appointment to, the Willhart Limited Board of Directors ("the Board").

Process

For Board appointments, other than the Chairman, the Committee will evaluate candidates and make recommendations for the Board decision.

Performance

At least annually, the Committee will conduct a performance review of the Board members and the Board performance. On finalisation of the review, the Committee will publish its report to the Board.

Succession Planning

The Committee is to periodically review the succession needs of the Board in discussion with the Chairman. The Committee is to maintain a schedule of eligible nominees who meet the eligibility criteria for the Board established by the Board on the recommendation of the Committee.

Composition

The Committee will be appointed by the Board. The Committee is to be chaired by the Chairman, with the balance comprising two other independent Board members.

Meetings

The Committee should meet at least twice per annum, and more frequently as required.

BOARD OF DIRECTORS DRAFT STATEMENT

Introduction

Corporate governance is effective and ethical management of business relationships to produce enhanced corporate performance. It is the system or process by which companies are directed and controlled. Boards of directors are responsible for the governance of their companies. The integral component of corporate governance is accountability - to whom those with responsibilities must account and how.

This Statement sets out:

  • the principles of how Byte Power Group Limited ("Byte Power") and its subsidiaries together will be managed;
  • how the board of directors of Byte Power Group Limited ("Board") and its various committees will function; and
  • how directors of Byte Power Group Limited ("Directors") and employees of Byte Power Group Limited will act in relation to Byte Power Group Limited's business.

Board of Directors' Charter

This Charter sets out the roles and responsibilities of the Board of Directors as derived from the Australian Stock Exchange Corporate Governance Council issued "Principles of Good Corporate Governance and Best Practice Recommendations". The purpose of the Charter is to assist the Board and its committees in the exercise of their responsibilities. The Board of Directors will review this Charter at least annually and, if appropriate, revise this Charter from time to time.

The Board is elected by shareholders to represent all shareholders. It is a Director's responsibility, in all decisions he or she is called upon to make concerning Byte Power's affairs, to conscientiously weigh the interests of shareholders in light of the circumstances and to consider the effects of such decisions on the interests of all shareholders.

Role of the Board

The Board of Directors is responsible for supervising the management of the business and the affairs of the Corporation. In discharging this duty, the Board has the following overall stewardship responsibilities:

  • Board
    • Establishing Board size and composition (through establishment of Nomination Committee);
    • Maintaining a formal orientation and education program for new Directors,
    • Assessing annually its own effectiveness and the effectiveness of individual Directors.
  • Senior Management
    • Selecting, evaluating and, if necessary, replacing the Chief Executive Officer (CEO) and other members of senior management;
    • Approving the overall Corporate organisational structure and the assignment of management responsibilities and powers to manage the Corporation;
    • Overseeing succession planning for senior management positions;
    • Approving the compensation of senior management (through Compensation Committee);
    • Advising and counselling the CEO;
  • Strategy
    • Review, evaluation and approval of:
    • the Corporate strategy for the company;
    • the Company's vision and mission statements;
    • strategic planning processes and strategic plans;
    • monitoring Corporate performance against stated objectives and plans;
  • Risk Management, Capital Management and Internal Control
    • Reviewing, approving and monitoring adherence to policies and procedures for the management and control of risk, including capital management, and internal control and management of information systems. These policies and procedures should provide reasonable assurance as to the reliability of the Corporations financial information and the safeguarding of it's assets;
    • Reviewing compliance with legislation and regulatory requirements;
  • Material Transactions
    • Reviewing and approving material investments and transactions;
  • Financial Reporting
    • Reviewing and approving the annual financial statements;
    • Reviewing the monthly financial statements;
  • Communication
    • Reporting the financial results to the shareholders and other stakeholders;
    • Approving policies with regard to confidentiality of information and securities trading by employees, corporate communications and public disclosure;
  • Other
    • Performing such other functions as prescribed by law or as assigned to the Board in the Corporation's governing documents.

Non-executive Directors

The expected role of non-executive Directors is to:

  • bring an independent view to the Board's deliberations;
  • assist the Board and the Chairman in providing effective leadership; and
  • foster the continuing effectiveness of executive Directors and management.

Executive Directors

Executive Directors (including the managing director) are full time employees of Byte Power and part of senior management. Their responsibilities for the overall corporate governance of Byte Power are the same as those for non-executive Directors. In addition, their managerial responsibilities include:

  • proposing policies and strategies for consideration by the Board;
  • communicating to senior management the policies and strategies adopted by the Board;
  • implementing the policies of the Board; and
  • carrying out day to day control and management of Byte Power’s business.

Composition of the Board

The Board of Directors is to be constituted with a majority of independent Directors to ensure that the Board can effectively monitor executive Directors and senior management and can bring, and be perceived to bring, quality judgements, free of bias, to all matters.

Independent Directors

An independent Director is one who is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the Director's ability to act with a view to the best interests of Byte Power ("Independent Director"). Independent Directors are non-executive Directors, and, generally, those who are not:

  • a substantial shareholder, or those who have significant financial or personal interests in, a substantial shareholder;
  • retained as a professional adviser, either personally or through his/her firm;
  • a significant customer and/or supplier of Byte Power; or
  • a substantial shareholder of, or has a significant financial or personal interest in, a significant customer and/or supplier of Byte Power.

Chairman of the Board

It is preferable that the Chairman of the Board be an Independent Director. The combination of the roles of Chairman and managing director is considered undesirable. The Chairman's role is to:

  • provide a mechanism to check on the powers and responsibilities of the managing director and other executive Directors;
  • ensure the participation of non-executive and well as executive Directors in Board activities;
  • ensure all relevant issues are on Board agendas; and
  • ensure non-executive Directors receive timely relevant information to enable them to be effective members of the Board.

Relationship of Board with Management

Management of the day to day business of Byte Power is to be conducted by or under the supervision of the managing director as appointed by the Board, and by those other officers and employees to whom the management function is properly delegated by the managing director.

The Board, together with the managing director, will develop and maintain a position description for the managing director, involving the definition of the limits to management's responsibilities. In addition, the Board will approve or develop the corporate objectives which the managing director is responsible for meeting and oversee their implementation.

The Board will adopt appropriate structures and procedures to ensure that the Board functions independently of management. Appropriate procedures may involve the Board meeting on a regular basis without management present or may involve expressly assigning the responsibility for administering the Board's relationship to management to a committee of the Board.

Communication between Directors and management will primarily be through the office of the managing director. When Directors seek clarification regarding information provided to Directors, or are seeking information about Byte Power generally, this may be sought directly from the appropriate senior executive, but the director should be advised. When Directors are providing information about opportunities for Byte Power or are seeking introduction of persons to Byte Power, this should always be through the managing director.

Board Committees

When the Board considers it necessary, Byte Power will establish the following committees of the Board to assist in the Board's role:

  • Audit & Risk Management Committee;
  • Credit Committee;
  • Remuneration Committee; and
  • Nomination Committee.

Committees

If the Board resolves to establish the Committees, charters will need to be prepared for each of the Committees.

Composition of Committees

The Committees should be chaired by an Independent Director appointed by the Board. Other members, as appointed by the chairman of each Committee, will comprise non-executive and executive Directors, senior executives and/or external professionals who possess skills and expertise suitable for carrying out the functions of the Committees.

Committee Minutes

Each Committee must maintain minutes of each Committee meeting, which will be made available to all Directors as soon as practicable after the Committee meeting.

Adhoc/Special Purpose Committees

The Board may establish appropriate ad hoc or special purpose committees from time to time. Such committees will have terms of reference or a charter agreed by the Board.

Review of Board

If established, the Remuneration Committee will annually review the Board's required size, effectiveness, mix of skills, experience and other qualities and make recommendations to the Board.

Independent Advice to Directors

Subject to the approval of the Board, an individual Director may engage an outside adviser at the expense of Byte Power for the purposes of seeking independent advice in appropriate circumstances.

Code of Conduct

Constitution of Byte Power

The Directors must adhere to, and the Board must conduct itself in accordance with, the constitution of Byte Power.

Fair Dealings and Related Party Transactions

Directors and senior management, will convey to all stakeholders the message that integrity and effective control cannot be compromised when dealing with any supplier, particularly if a supplier is a related party.

A Director, or an entity over which a Director has control or significant influence, who enters into a transaction with Byte Power must make full disclosure of all material elements of the transaction to the Chairman or, if the Director involved is the Chairman, to the Board.

In particular, the following contracts with Directors, or entities over which Directors have control or significant influence, must be approved by the Board in advance of committing Byte Power:

  • contracts for the supply of goods and/or services which extend beyond 1 year, or where the total value of goods and/or services supplied under the contract may, in any 1 year, exceed 5% of Byte Power's previous year's total revenue;
  • agreements for the lease of property; and
  • agreements for the acquisition or disposal of property.

Disclosure of Information

Byte Power has an objective of honest and open disclosure of information in dealing with stakeholders, subject to appropriate commercial considerations associated with competitive and sensitive information. Such disclosure may, in appropriate circumstances, exceed statutory requirements.

Confidentiality

All Directors must ensure that they abide by requirements of Byte Power's constitution regarding secrecy and confidentiality of information.

Share Dealings

The Board will adopt an appropriate policy on dealings in securities of Byte Power by Directors and senior management.

The initial policy is contained in the attached document. The policy on dealings in securities will be reviewed from time to time to ensure the policy's effectiveness.