When determining the independent status of a Director, the revised Corporate Governance Principles state that the Board should consider whether the Director: 

• is a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial shareholder of the Company; 

• is employed, or has previously been employed in an executive capacity by the Company or another Group member, and there has not been a period of at least three years between ceasing such employment and serving on the Board; 

• has within the last three years 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; and 

• is 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 who has a material contractual relationship with the Company or another Group member other than as a Director. 

Recommendation 2.2 of the revised Corporate Governance Council Principles provides that the Chairman should be an Independent Director. Also, Recommendation 2.3 of the revised Corporate Governance Council Principles provides that the roles of the Chairman and the Chief Executive Officer should not be exercised by the same individual. The Company’s Chairman also acts as its Chief Executive Officer and was also its founding Director and is one of the Company’s largest shareholders. Given the stage of the Company’s growth, the Board of Directors considers it acceptable for the Chairman to be an Executive Director and not independent. 

## Meeting Schedule 

The Board of Directors meets at least every two months with additional committee meetings, if and when required, to discuss specific matters. 

## Advice to Directors 

Subject to the approval of the Board of Directors, an individual Director may engage an independent professional adviser at the expense of the Company in appropriate circumstances. 

## Board Committees 

The Board of Directors may establish appropriate committees to assist in its roles and responsibilities at appropriate points in the Company’s growth. 

The Board of Directors has established an Audit Committee, a Remuneration Committee and a Nomination Committee. 

## Audit Committee 

The role of the Audit Committee is to advise on the establishment and maintenance of a framework of internal control and the appropriate ethical standards for the financial management of the Group. The Company has formally adopted an Audit Committee Charter. A copy of the Audit Committee Charter can be found on the Company’s website at www.karoongas.com.au. 

The Audit Committee also reviews the quality and reliability of financial information prepared for use by the Board of Directors in determining policies or for inclusion in financial statements. 

The Audit Committee consists of: 

Mr Geoff Atkins (Chairman) Mr Clark Davey Mr Stephen Power 

The record of attendance for each of the members of the Audit Committee is set out in the Directors’ Report of the Annual Report. 

