In this Charter, a reference to the "Company" means Lachlan Star Limited and the economic entity constituted by Lachlan Star Limited and the entities that it controls from time to time.

1. PURPOSE AND OBJECTIVE
   

   The Audit Committee ("Committee") is a committee of the board of directors ("Board") of the Company. The Committee's purpose is to assist the Board in fulfilling its obligations and responsibilities relating to financial reporting, internal controls, corporate governance and the internal and external audit processes.

2. AUTHORITY
   • 2.1 The Board authorizes the Committee to investigate any activity within its terms of reference or involving financial accounting and financial reporting and internal controls.
   • 2.2 The Board authorizes the Committee to seek any information it requires from any employee and from external parties, to engage external legal or professional advice and to ensure the attendance of Company officers at meetings, as the Committee deems appropriate.
   • 2.3 The Committee shall receive appropriate funding, as determined by the Committee, for payment of compensation to the external auditors and to any legal or other advisers employed by the Committee, and for payment of ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties.
   • 2.4 The Committee may communicate directly with the internal and external auditors.
3. COMPOSITION, PROCEDURES AND ORGANIZATION
   • 3.1 The Committee shall consist of at least three independent, non-executive members of the Board.
   • 3.2 Except as permitted by all applicable legal and regulatory requirements:
     • (a) each member of the Committee shall be "independent" as defined in accordance with Canadian National Instrument 52-110 – Audit Committees; and
     • (b) each member of the Committee shall be "financially literate" with the ability to read and understand a set of financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the Company's financial statements.
   • 3.3 The Board shall review Committee membership on an annual basis and at other times as the Board may deem appropriate. The Board may at any time remove or replace any member of the Committee and may fill any vacancy in the Committee.
   • 3.4 The members of the Committee shall be entitled to receive such remuneration for acting as members of the Committee as the Board may from time to time determine.
4. ROLES AND RESPONSIBILITIES
   The roles and responsibilities of the Committee are as follows:
   • 4.1 Oversee the accounting and financial reporting processes of the Company and the audits of the financial statements of the Company.
   • 4.2 Review with management its philosophy with respect to controlling corporate assets and information systems, the staffing of key functions and its plans for enhancements.
   • 4.3 Prepare a statement, in accordance with applicable law, for inclusion in the Company's annual report that describes the Committee's composition, activities and responsibilities.
   • 4.4 Review the terms of reference and effectiveness of any internal audit process, and the working relationship between internal financial personnel and the external auditor.
   • 4.5 Gain an understanding of the current areas of greatest financial risk and whether management is managing these effectively.
   • 4.6 Review significant accounting and reporting issues, including recent professional and regulatory pronouncements, and understand their impact on the financial statements, reviewing with management and the external auditor where appropriate.
   • 4.7 Review any legal matters which could significantly impact the financial statements as reported on by the Company's legal counsel and meet with outside counsel whenever deemed appropriate.
   • 4.8 Review the annual financial statements and the results of the audit with management and the external auditors prior to the release or distribution of such statements, and obtain an explanation from management of all significant variances between comparative reporting periods.
   • 4.9 Review the interim financial statements with management prior to the release or distribution of such statements, and obtain an explanation from management of all significant variances between comparative reporting periods.
   • 4.10 Assess the fairness of the financial statements and disclosures, and obtain explanations from management on whether:
     • (a) actual financial results for the financial period varied significantly from budgeted or projected results;
     • (b) applicable generally accepted accounting principles have been consistently applied;
     • (c) there are any actual or proposed changes in accounting or financial reporting practices; and
     • (d) there are any significant, complex and/or unusual events or transactions such as related party transactions or those involving derivative instruments and consider the adequacy of disclosure thereof.
   • 4.11 Review all public disclosure concerning audited or unaudited financial information before its public release and approval by the Board, including management's discussion and analysis, financial information contained in any prospectus, private placement offering document, annual report, annual information form, takeover bid circular, and any annual and interim earnings press releases, and determine whether they are complete and consistent with the information known to Committee members.
   • 4.12 Determine whether the auditors are satisfied that the financial statements have been prepared in accordance with applicable generally accepted accounting principles.
   • 4.13 Focus on judgmental areas, for example those involving valuation of assets and liabilities and other commitments and contingencies.
   • 4.14 Review audit issues related to the Company's material associated and affiliated companies that may have a significant impact on the Company's equity investment.
   • 4.15 Ascertain whether any significant financial reporting issues were discussed by management and the external auditor during the fiscal period and the method of resolution.
   • 4.16 Review and resolve any significant disagreement between management and the external auditors in connection with the preparation of the financial statements.
   • 4.17 Recommend to the Board the selection of the firm of external auditors to be proposed for election as the external auditors of the Company.
   • 4.18 Review and approve the proposed audit plan and the external auditors' proposed audit scope and approach with the external auditor and management and ensure no unjustifiable restriction or limitations have been placed on the scope.
   • 4.19 Explicitly approve, in advance, all audit and non audit engagements of the external auditors; provided, however, that non audit engagements may be approved pursuant to a pre approval policy established by the Committee that: (i) is detailed as to the services that may be pre approved, (ii) does not permit delegation of approval authority to the Company's management, and (iii) requires that the delegate or management inform the Committee of each service approved and performed under the policy. Approval for minor non audit services is subject to applicable securities laws.
   • 4.20 If it so elects, delegate to one or more members of the Committee the authority to grant the pre approvals referred to in paragraph 4.19. The delegate's decisions regarding approval of services shall be reported by such delegate to the full Committee at each regular Committee meeting.
   • 4.21 Subject to the grant by the shareholders of the authority to do so, if required, review the appropriateness and reasonableness of the compensation to be paid to the external auditors and make a recommendation to the Board regarding such compensation.
   • 4.22 Oversee the independence of the external auditors. Obtain from the external auditors a formal written statement delineating all relationships between the external auditors and the Company. Actively engage in a dialogue with the external auditors with respect to any disclosed relationships or services that impact the objectivity and independence of the external auditor.
   • 4.23 Review and approve the Company's hiring policies regarding partners, employees and former partners and employees of the present and former external auditors of the Company.
   • 4.24 Review the performance of the external auditors, and in the event of a proposed change of auditor, review all issues relating to the change, including the information to be included in any notice of change of auditor as required under applicable securities laws, and the planned steps for an orderly transition.
   • 4.25 Review the post-audit or management letter containing the recommendations of the external auditor and management's response and subsequent follow-up to any identified weakness.
   • 4.26 Review the evaluation of internal controls and management information systems by the external auditor, and, if applicable, the internal audit process, together with management's response to any identified weaknesses and obtain reasonable assurance that the accounting systems are reliable and that the system of internal controls is effectively designed and implemented.
   • 4.27 Gain an understanding of whether internal control recommendations made by external auditors have been implemented by management.
   • 4.28 Review the process under which the Managing Director and the Chief Financial Officer evaluate and report on the effectiveness of the Company's design of internal control over financial reporting and disclosure controls and procedures.
   • 4.29 Obtain regular updates from management and the Company's legal counsel regarding compliance matters, as well as certificates from the Chief Financial Officer as to required statutory payments and bank covenant compliance and from senior operating personnel as to permit compliance.
   • 4.30 Establish a procedure for the:
     • (a) confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters, and
     • (b) receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters.
   • 4.31 Meet separately with the external auditors to discuss any matters that the Committee or auditors believe should be discussed privately.
   • 4.32 Endeavour to cause the receipt and discussion on a timely basis of any significant findings and recommendations made by the external auditors.
   • 4.33 Ensure that the Board is aware of matters which may significantly impact the financial condition or affairs of the business.
   • 4.34 Review and assess the adequacy of this Charter from time to time and recommend any changes to the Board for approval.
   • 4.35 Review and assess the adequacy of insurance coverage, including directors' and officers' liability coverage.
   • 4.36 If it deems necessary, institute special investigations and, if it deems appropriate, hire special counsel or experts to assist, and set the compensation to be paid to such special counsel or other experts.
   • 4.37 Perform other functions as requested by the full Board.
5. MEETINGS
   • 5.1 The Committee shall elect from its members a Chairman, who shall not also be the chairman of the Board. The Chairman shall have the duties and responsibilities set out in Schedule A hereto.
   • 5.2 The secretary of the Committee (the "Secretary") will be the company secretary or such other person appointed by the Board.
   • 5.3 A record of the minutes of, and the attendance at, each meeting of the Committee shall be kept and maintained by the Secretary. The Secretary shall ensure the minutes are maintained in a secure environment and shall ensure approved minutes are circulated to the Board forthwith.
   • 5.4 The Committee shall meet at least once in each financial reporting period, each such meeting being designed to coincide with the Company's reporting of its interim and annual financial results. Therefore, if pursuant toapplicable regulatory or stock exchange requirements the Company is required by to report financial results on an annual and half-yearly basis, the Committee shall meet at least twice per year, and if the Company is required to report financial results on an annual and quarterly basis, the Committee shall meet at least four times per year. The Committee shall hold additional Committee meetings as and when the Committee may otherwise deem appropriate.
   • 5.5 No business may be transacted by the Committee except at a meeting at which a quorum is present. Two Committee members shall constitute quorum.
   • 5.6 The times and places where meetings of the Committee shall be held and the procedures at such meetings shall be as determined, from time to time, by the Committee. Committee meetings may be held in person or over the telephone or as the Committee may otherwise deem fit.
   • 5.7 Notice of each meeting of the Committee shall be given to each member of the Committee. Members may waive notice of any meeting. Attendance at a meeting shall be deemed to constitute waiver of notice, unless specific objection to notice is raised at the commencement of the meeting.
   • 5.8 The Committee may invite such other persons to attend its meetings, including the managing director, the chief financial officer, the company secretary, general counsel and the external auditor, as it deems necessary.

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COMPANY PROFILE

DIRECTOR PROFILES

MANAGEMENT

CORPORATE GOVERNANCE