The Board hereby resolves to establish a committee of the Board, to be known as the Remuneration Committee (the "Committee").
2.1 The Committee shall be appointed by the Board taking account of any recommendations made by the Nomination Committee (if one has been constituted). All members of the Committee shall be independent non-executive directors of the Company. The Committee shall consist of not less than three members. Two members shall comprise a quorum at any meeting of the Committee.
2.2 The chairman of the Committee shall be appointed by the Board from amongst the independent non-executive directors. In the absence of the chairman of the Committee the remaining members present shall elect one of their number to chair the meeting.
3. Attendance at Meetings
3.1 The Chairman of the Board and other Board members shall attend meetings if invited by the Committee. However, no director shall be involved in any decision or be present at any discussions as to their remuneration.
3.2 The Company Secretary shall be secretary to the Committee
4. Frequency of Meetings
4.1 Meetings shall be held not less than twice each year and, where appropriate shall coincide with key dates in the Company's financial reporting cycle.
4.2 Additional meetings shall be held as required, and any member of the Committee, the Finance Director, the external auditors of the Company Secretary may request a meeting if they consider that one is necessary.
5.1 The Committee is authorised by the Board to:
5.1.1 investigate any activity within its terms of reference;
5.1.2 seek any information that it requires from any employee (and all employees are directed to co-operate with any request made by the Committee);
5.1.3 to assess the remuneration paid by other UK listed companies of a similar size in any comparable industry sector and to assess whether changes to the executive directors' remuneration is appropropriate for the purpose of making their remuneration competitive or otherwise comparable with the remuneration paid by such companies;
5.1.4 employ the services of any external remuneration consultant or other professional adviser as it thinks fit, and may invite any of such persons to attend such meetings of the Committee as it considers appropriate. The budget for fees payable by the Committee to external advisers is to be agreed with the Board at the beginning of each financial year; and
5.1.5 obtain external legal or other independent professional advice and request advisors to attend meetings as necessary.
6.1 The responsibilities of the Committee shall be:
6.1.1 determine and agree with the Board the framework or Board policy for remuneration of the Chief Executive, Chairman of the Company and such other members of the executive management as it is designated to consider;
6.1.2 set remuneration for the all executive directors, the Chairman and the Company Secretary;
6.1.3 determine targets and criteria for any performance-related pay schemes operated by the Company;
6.1.4 determine the policy for and scope of pension arrangements for each executive director;
6.1.5 to oversee and review all aspects of any share option scheme operated by or to be established by the Company, including but not limited to (subject always to the scheme rules and any applicable legal or London Stock Exchange requirements):
- The selection of the eligible directors and other employees to whom the options should be granted;
- the timing of any grant;
- the numbers of shares over which options are to be granted;
- the exercise price at which options are to be granted; and
- the imposition of any objective condition which must be compiled with before any option may be exercised;
6.1.6 ensure that contractual terms on termination, and any payments made, are fair to the individual and the Company, that failure is not rewarded and that the duty to mitigate loss is fully recognised;
6.1.7 within the terms of agreed policy, determine the total individual remuneration package of each executive director including, where appropriate, bonuses, incentive payments and share options;
6.1.8 in determining such packages and arrangements, give due regard to the contents of the Combined Code as well as (insofar as is applicable) the UK Listing Authority's Listing Rules and associated guidance;
6.1.9 be aware of and advise on any major changes in employee benefit structures throughout the Company or other companies within the Company's group;
6.1.10 agree the policy for authorising claims for expenses from the Chief Executive and the Chairman;
6.1.11 ensure the provisions regarding disclosure of remuneration, including pensions, as set out in the Directors' Remuneration Report Regulations 2002 and the Combined Code are fulfilled.
6.1.12 be exclusively responsible for establishing the selection criteria, selecting, appointing and setting the terms of reference for any remuneration consultants who advise the Committee; and
6.1.13 to consider other topics and issues relating to the remuneration of or terms or employment applicable to the executive directors that may be referred to the Committee by the Board.
7. Reporting Procedures
7.1 The Secretary shall circulate the minutes of the meeting of the Committee to all members of the Board.
7.2 The chairman of the Committee, or in their absence another member of the Committee, shall attend the Board meeting at which the annual accounts and reports are approved.
7.3 A report on the Committee's responsibilities and activities during the year shall be disclosed in the annual report and accounts should contain such information as is required to comply with the AIM Rules;
7.4 The chairman of the Committee shall attend the Company's annual general meeting and answer questions, through the Chairman of the Board, on the Committee's responsibilities and activities.
8. Self-assessment and Appraisal
The Committee shall conduct an annual review of its work and terms of reference, and an annual assessment of its own effectiveness and make recommendations to the Board.