Corporate Governance

The Board of Directors of Serabi monitors the business affairs of the company on behalf of shareholders. The Board currently consists of the Non – Executive Chairman, Managing Director, Finance Director and five futher non-executive Directors. None of the non-executive Directors has held an executive position with the Company in the past. The Directors have responsibility for the overall corporate governance of the company and recognize the need for the highest standards of behaviour and accountability. The Directors are committed to the principles underlying best practice in corporate governance and intend to comply with the principles of the Combined Code in such respects as they consider appropriate for a company of Serabi’s size and nature. In addition the Company as a result of the listing of its shares on the TSX is obliged to company with Canadian National Policy 58-201 – Corporate Governance Guidelines which establishes corporate governance guidelines that apply to all public companies. The Company has instituted its own corporate governance practices in light of these guidelines.

The board of directors is responsible for the stewardship of the Company through consultation with management of the Company. Any responsibility that is not delegated to management or to the committees of the board of directors remains with the board of directors, subject to the powers of the shareholders’ meetings. The frequency of board of directors meetings, as well as the nature of agenda items, varies depending on the state of the Company’s affairs and in light of opportunities or risks which the Company faces. Members of the board of directors are in frequent contact with one another and meetings of the board of directors are held as deemed necessary.

The Company is subject to the UK City Code of Takeovers and Mergers.

The Company has established an Audit Committee and a Remuneration Committee.

Composition of the Audit Committee

The audit committee comprises Messrs. Williams (Chair), Swett and Harvey. It is responsible for ensuring that the financial performance of the Group is properly reported on and monitored and for reviewing the auditor’s reports relating to accounts and internal control systems. Each member of the audit committee is considered to be independent within the meaning of Canadian NI 52-110. All members of the audit committee are financially literate in that they have the ability to read and understand a set of financial statements that are of the same breadth and level of complexity of accounting issues as can be reasonably expected to be raised by the Company’s financial statements. The board of directors has unanimously approved the adoption of an Audit Committee Charter which governs the composition, responsibilities, conduct and authority of the Audit Committee.

Composition of the Remuneration Committee

The Remuneration Committee comprises Messrs. Williams (Chair), Harvey and Banados. It is responsible for determining and agreeing with the Board the framework for the remuneration of the Managing Director, all other Executive Directors, the Company Secretary and such other members of the Executive management as it is designated to consider. It is furthermore responsible for determining the total individual remuneration packages of each director including, where appropriate, bonuses, incentive payments and share options.

In addition, an Executive Management Committee, comprised of the Chief Executive Officer and Finance Director, directs the day-to-day operations of the company.

The Company has adopted a share dealing code for Directors and relevant employees in accordance with the AIM Rules, MAR and Canadian securities legislation regulations and will take proper steps to ensure compliance by the Directors and those employees.