BOARD CHARTER

PURPOSE OF CHARTER

The Board charter sets out the role, composition and responsibilities of the Board of Sipa Resources Limited ("Sipa") within the governance structure of Sipa and its wholly owned entities ("the Sipa Group"). The conduct of the Board is also governed by the Constitution of Sipa, a copy of which is located at www.sipa.com.au. The Board will review this charter annually to ensure it remains consistent with the Board’s objectives and responsibilities.

COMPOSITION AND TERM

The Constitution provides for a minimum of three directors and a maximum of ten directors. The Board has adopted a policy to have five directors; four non-executive directors and one executive director, the Managing Director. The Board shall maintain a majority of independent non-executive directors.

The Chairperson of the Board must be an independent non-executive director.

The Board should comprise directors with an appropriate range of qualifications and expertise.

The term of office and rotational procedures for tenure of Directors are outlined in the Company’s Constitution.

The Board should meet at least quarterly and follow meeting guidelines set down to ensure all Directors are made aware of, and have available all necessary information, to participate in an informed discussion of all agenda items.

The threshold for materiality for the purpose of assessing the materiality of relationships between a non-executive director and Sipa (other than as a director) will be judged according to the significance of the relationship to the director in the context of their activities as a whole.

BOARD RESPONSIBILITIES

1. The Board is responsible for to shareholders for the overall Corporate Governance of the Sipa Group including its strategic direction, establishing goals for management and monitoring the achievement of those goals in a way which ensures that the interests of shareholders and stakeholders are promoted and protected.
2. The responsibility for the operation and administration of the Sipa Group is delegated by the Board to the Managing Director and the executive team.
3. Specifically, the Board is responsible for:

1. Identifying the expectation of the shareholders, as well as other regulatory and ethical expectations and obligations.
2. Ensuring that the executive team is appropriately qualified and experienced to discharge their responsibilities and has in place procedures to assess the performance of the Managing Director and executive team.
3. Appointing and removing the managing director/CEO and overseeing succession plans for the senior executive team.
4. Setting strategic direction of the Sipa Group and monitoring management’s performance within that framework;
5. Ensuring there are adequate resources available to meet Sipa’s objectives;
6. Approving and monitoring financial reporting and capital management;
7. Approving and monitoring the progress of business objectives;
8. Identifying areas of significant business risk and ensuring that arrangements are in place to adequately manage those risks.
9. Ensuring that the Sipa Group has appropriate corporate governance structures in place including standards of ethical behavior and a culture of corporate and social responsibility; and
10. Ensuring that the Board maintains an appropriate range of qualifications and expertise.

RESPONSIBILITIES OF THE CHAIRMAN

The Chairman is responsible for leading the Board in its duties to the ASX Group. Specifically, the Chairmen is responsible for:

1. Ensuring there are processes and procedures in place to evaluate the performance of the Board, its committees and individual directors;
2. Facilitating effective discussions at Board meetings; and
3. Ensuring effective communication with shareholders.

RESPONSIBILITIES OF THE MANAGING DIRECTOR

The Managing Director is responsible for:

1. Policy direction of the operations of the Sipa Group;
2. The efficient and effective operation of the Sipa Group;
3. Ensuring directors are provided with accurate and clear information in a timely manner to promote effective decision-making by the Board; and
4. Ensuring all material matters affecting the Sipa Group are brought to the Board’s attention.

The ASX Corporate Governance Council "Principles of Good Corporate Governance and Best Practice Recommendations" states that an independent director is a non-executive director and:

1. is not a substantial shareholder of the company or an officer of, or otherwise associated directly with, a substantial shareholder of the company;
2. within the last three years has not been employed in an executive capacity by the company or another group member, or been a director after ceasing to hold any such employment;
3. within the last three years has not been a principal of a material professional adviser or a material consultant to the company or another group member, or an employee materially associated with the service provided;
4. is not a material supplier or customer of the company or other group member, or an officer of or otherwise associated directly or indirectly with a material supplier or customer has no material contractual relationship with the company or another group member other than as a director of the company;
5. has not served on the board for a period which could, or could reasonably be perceived to, materially interfere with the director’s ability to act in the best interests of the company;
6. 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 in the best interests of the company.