1. OVERVIEW
1.1 Contrary to In accordance with the Australian
Stock Exchange Corporate Governance Council's recommendation 9.2,
which states "The Board should establish a remuneration
committee", the Board of Medusa Mining Limited
("Medusa" or the "Company") believes the
Company is not of a size, nor are its financial affairs of such
complexity to justify the establishment of formalized a
Remuneration Committee on 18 November 2009.
1.2 At this stage of Medusa's development, the
Board has resolved:
(a) not to establish a Remuneration Committee
("Committee");
(b) that the issue whether a Committee be
established, be reviewed annually;
(c) to implement a formal charter that clearly
outlines the Committee's role and responsibilities, composition,
structure and membership requirements; and
(d) that the responsibility for all issues and
matters normally dealt with by the Committee be handled by the
Board of Directors.
2. OBJECTIVES
2.1 The function of the Committee is to assist the
Board in fulfilling its corporate governance responsibilities with
respect to remuneration by reviewing and making appropriate
recommendations on:
(a) remuneration packages of Executive
Directors, Non-Executive Directors and Senior Executives;
(b) employee incentive plans and benefit
programs, including the appropriateness of performance hurdles
and total payments proposed;
(c) recruitment, retention and termination
policies and procedures;
(d) superannuation arrangements; and
(e) employee equity based plans and schemes.
2.2 In discharging its role, the Committee must:
(a) clearly distinguish the structure of
Non-Executive Directors' remuneration from that of Executive
Directors; and
(b) also ensure that payment of equity based
executive remuneration is made in accordance with threshold
set in plans approved by shareholders.
2.3 Until such time as the Committee is formally
established, the functions of the Committee will be dealt
forthwith by the full Board of Directors.
3. MEMBERSHIP
3.1 The structure of the Committee to be appointed
by the Board, will consist of:
(a) at least 3 members;
(b) at least 2 Non-Executive Directors;
(c) a majority of Directors that are independent
of management; and
(d) an independent Chairperson (who is not the
Chairperson of the Board)
3.2 The Secretary of the Committee will be the
Company Secretary, or any other person nominated by the Board.
4. MEETINGS
4.1 The Committee shall meet at least once a year.
4.2 Additional meetings may be convened if
requested by any member of the Committee.
4.3 The Committee may invite any person with
relevant experience and expertise at Committee meetings, if it
considers their attendance to be appropriate, eg external
advisers.
4.4 The quorum for a meeting is two members.
4.5 The Committee may have access where necessary
to professional advice from external advisers and may meet with
such external advisers without management being present.
4.6 The Secretary, in conjunction with the
Chairperson of the Committee is responsible for preparation of the
agenda for each meeting and must circulate the agenda and
Committee papers to each member of the Committee at least 2
business days before each meeting.
5. ROLE AND RESPONSIBILITIES
The responsibilities of the Committee primarily
involves reviewing and making the appropriate recommendations to
the Board with respect to the following issues:
5.1 Executive Remuneration and Incentive Policies:
Make recommendations to the Board with respect
to appropriate remuneration and incentive policies for Executive
Directors and Senior Executives which:
(a) motivates Executive Directors and Senior
Executives to pursue long term growth and success of the Company
within an appropriate control framework; and
(b) demonstrates a clear distinction between key
performance and remuneration.
5.2 Executive Remuneration Packages:
The Committee need to ensure that:
(a) Executive remuneration packages involve a
balance between fixed and incentive pay, reflecting short and
long term performance objectives appropriate to the Company's
circumstances and objectives;
(b) a proportion of Executives' remuneration is
structured in a manner designed to link reward to corporate and
individual performances;
(c) recommendations are made to the Board with
respect to the quantum of bonuses to be paid to Executives; and
(d) any contract of employment requiring more
than 12 months notice is brought to the attention of the Board.
5.3 Non-Executive Directors
The committee must ensure that:
(a) fees paid to Non-Executive Directors are
within the aggregate amount approved by shareholders and make
recommendations to the Board with respect to the need for
increases to this aggregate amount at the Company's Annual
General Meeting;
(b) Non- Executive Directors are remunerated by
way of fees (in the form of cash or superannuation benefits);
(c) Non-Executive Directors are not provided
with retirement benefits other than statutory superannuation
entitlements; and
(d) Non-Executive Directors are not entitled to
participate in equity based remuneration schemes designed for
Executives.
5.4 Recruitment Policy, Employee Incentive Plans
and Benefits Programs
(a) regularly review and make recommendation to
the Board in respect of the Company's recruitment policy;
(b) ensure that incentive plans are designed
around appropriate and realistic performance targets that
measure relative performance and provide rewards when they are
achieved; and
(c) continually review and if necessary improve
any existing benefit programs established for employees.
5.5 Superannuation
Periodically review and provide advice to the
Board in relation to the Company's superannuation arrangement and
to ensure it complies (at the minimum) with the requirements of
the Superannuation Guarantee Levy.
5.6 Termination
(a) regularly review the Company's policy on
termination, in particular to the compensation agreed to be paid
to Executives in connection with termination of employment;
(b) ensure that any termination for Executives
are agreed in advance, including detailed provisions in case of
early termination, except for removal for misconduct;
(c) ensure that employment contracts include a
clear articulation of performance expectations; and
(d) need to consider the consequences of an
appointment that is performing to the satisfaction of the
Company; and
(e) ensure that allowance is made for the costs
and the impact as a result of any early termination.
6. REPORTING
