Terramin Australia : Updated 2021 Corporate Governance Statement

8 April 2022

UPDATED 2021 CORPORATE GOVERNANCE STATEMENT

Terramin Australia Limited (ASX: TZN) (Terramin or the Company) provides the appended 2021 Corporate

Governance Statement, which has been updated to clarify and explain the Company's position in respect of

Recommendation 4.3.

The Board has approved this ASX Announcement.

For further information, please contact:

Investor Relations

Martin Janes Executive Officer Terramin Australia Limited [phone]

Media Enquiries

Mike O'Reilly

Media & Government Consulting

O'Reilly Consulting [phone]

Terramin Australia Ltd ACN 062 576 238

2115 Callington Road Strathalbyn SA 5255 T [phone] terramin.com.au

Recommendation 1.3 - Recommendation followed

Corporate Governance Statement Principles and Recommendations

Principle 1 - Lay solid foundations for management and oversight

Recommendation 1.1 - Recommendation followed

A listed entity should have and disclose a board charter setting out:

• (a) the respective roles and responsibilities of its board and management; and

• (b) those matters expressly reserved to the board and those delegated to management.

The Company's Board Charter sets out (amongst other things): (a) the roles and responsibilities of the Board and of management; (b) the matters expressly reserved to the Board; and (c) the matters delegated to management. A copy of the Board Charter can be viewed at:

https://www.terramin.com.au/corporate/charters-policies/

The Audit & Risk Committee and Nomination & Remuneration Committee have also been referred responsibilities by the

Board as set out in each Committee's Charter. The Charters for the Committees can be viewed at:

https://www.terramin.com.au/corporate/charters-policies/

Recommendation 1.2 - Recommendation followed

A listed entity should:

• (a) undertake appropriate checks before appointing a director or senior executive or putting someone forward for election as a director; and

• (b) provide security holders with all material information in its possession relevant to a decision on whether or not to elect or re-elect a director.

Prior to the appointment of a person, or putting forward to security holders a candidate for election, as a director, the Company undertakes checks which it believes are appropriate to verify a director's character, experience, education, criminal record and bankruptcy history including for new directors:

• • background and reference checking;

• • requesting information in relation to the person's current and previous positions, directorships, bankruptcy history and any potential conflicts of interests.

The Company ensures that all material information in its possession relevant to a shareholder's decision whether to elect or re-elect a director, including the information referred to in Recommendation 1.2, is provided to shareholders in the

Company's Notice of Annual General Meeting.

A listed entity should have a written agreement with each director and senior executive setting out the terms of their appointment.

Each director and senior executive of the Company has an agreement in writing with the Company which sets out the key terms and conditions of their appointment including their duties, rights and responsibilities and (to the extent applicable) the matters referred to in the commentary to Recommendation 1.3.

Recommendation 1.4 - Recommendation followed

The company secretary of a listed entity should be accountable directly to the board, through the chair, on all matters to do with the proper functioning of the board.

The Company Secretary has a direct line of reporting to the Chairman and is responsible for:

• • advising and supporting the Chairman and the Board and its committees to manage the day to day governance framework of the Company;

• • assisting with Board effectiveness by monitoring whether applicable Board and committee policies, procedures and charters are followed and coordinating timely completion and despatch of Board agendas and papers; and

• • assisting with all matters to do with the proper functioning of the Board including advising on governance matters and assisting with induction and professional development of directors.

The responsibilities of the Company Secretary are set out in the Board Charter located at:

https://www.terramin.com.au/corporate/charters-policies/

Recommendation 1.5 - Recommendation not followed

A listed entity should:

• (a) have and disclose a diversity policy;

• (b) through its board or a committee of the board set measurable objectives for achieving gender diversity in the composition of its board, senior executives and workforce generally; and

• (c) disclose as at the end of each reporting period:

  • (i) the measurable objectives set for that period to achieve gender diversity;

  • (ii) the entity's progress towards achieving those objectives; and

  • (iii) either:

    • • the respective proportions of men and women on the board, in senior executive positions and across the whole workforce (including how the entity has defined "senior executive" for these purposes); or

Recommendation 1.6 - Recommendation not followed

• • if the entity is a "relevant employer" under the Workplace Gender Equality Act, the entity's most recent "Gender Equality Indicators", as defined in and published under that Act.

If the entity was in the S&P / ASX 300 Index at the commencement of the reporting period, the measurable objective for achieving gender diversity in the composition of its board should be to have not less than 30% of its directors of each gender within a specified period.

The Company seeks to treat everyone with fairness and respect which includes valuing diversity and difference and acting without prejudice. The Company believes that decision-making is enhanced through diversity and supports and encourages diversity at all levels of the organisation in accordance with the Company's Diversity & Equal

Employment Opportunity Policy. A copy of the Diversity & Equal Employment Opportunity Policy is located at:

https://www.terramin.com.au/corporate/charters-policies/

The Nomination & Remuneration Committee is responsible for recommending to the Board any measurable objectives for achieving gender diversity and reviewing regularly any such objectives and the Company's progress towards achieving them. The Committee reviews and reports to the Board at least annually on the relative proportion of women and men appointed or employed within the Company group. A copy of the Committee Charter is located at:

https://www.terramin.com.au/corporate/charters-policies/

Given the size of the Company and status of the Company's exploration and development projects, the directors believe that it is not appropriate at this stage to set measurable objectives in relation to diversity beyond those included in the Diversity & Equal Employment Opportunity Policy. Notwithstanding this, the Company strives to provide the best possible opportunities for current and prospective employees of all backgrounds in such a manner that best adds to overall shareholder value and which reflects the values, principles and spirit of the Diversity & Equal Employment Opportunity Policy. The directors also believe that diversity is a relevant consideration for constitution of an effective Board, as discussed at Recommendation 2.2. For the reporting year ended 31 December 2021, the Company had a total of:

• • 1 female employee out of a total of 7 employees in Australia (not including overseas employees);

• • no female employee out of a total of 1 employee in executive positions; and

• • 1 female director out of a total of 5 directors on the Board.

The Company was not in the S&P / ASX 300 Index at the commencement of the reporting period.

A listed entity should:

• (a) have and disclose a process for periodically evaluating the performance of the board, its committees and individual directors; and

• (b) disclose for each reporting period whether a performance evaluation has been undertaken in accordance with that process during or in respect of that period.

The Board recognises that as a result of the Company's size and its position as a publicly listed exploration and development company, the assessment of the Board's overall performance and its own succession plan is conducted on an ad hoc basis. Whilst Recommendation 1.6 is not strictly followed the Directors consider that at the date of this report the evaluation process of company directors is appropriate and effective. A more formal process of Board assessment will be considered in the future as the Company develops.

The informal review undertaken by the Board considers various matters including those set out in the Board Charter located at:

https://www.terramin.com.au/corporate/charters-policies/

The Nomination & Remuneration Committee assists the Board as required with the evaluation of performance of directors.

Recommendation 1.7 - Recommendation followed

A listed entity should:

• (a) have and disclose a process for evaluating the performance of its senior executives at least once every reporting period; and

• (b) disclose for each reporting period whether a performance evaluation has been undertaken in accordance with that process during or in respect of that period.

The performance of senior executives is reviewed annually with the assistance of the Nomination & Remuneration Committee. These evaluations consider criteria such as the achievement and performance towards the Company's objectives and (where appropriate) performance benchmarks and the achievement of individual performance objectives.

During the reporting period, senior executive performance agreements with performance objectives and annual review processes were in place.

Principle 2 - Structure the board to add value

Recommendation 2.1 - Recommendation followed

The board of a listed entity should:

• (a) have a nomination committee which:

  • (i) has at least three members, a majority of whom are independent directors; and

  • (ii) is chaired by an independent director, and disclose:

  • (iii) the charter of the committee;

  • (iv) the members of the committee; and

  • (v) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or

• (b) if it does not have a nomination committee, disclose that fact and the processes it employs to address board succession issues and to ensure that the board has the appropriate balance of skills, knowledge, experience, independence and diversity to enable it to discharge its duties and responsibilities effectively.

The Company has a Nomination & Remuneration Committee which comprises 3 non-executive directors, the majority of whom are independent directors (Mr McGuinness and Mr Kennedy) and which is chaired by an independent director (Mr McGuinness).

The Remuneration & Nomination Committee's Charter is located at:

https://www.terramin.com.au/corporate/charters-policies/

The Committee's members, the number of times the

Committee met throughout the reporting period and the attendance of the Committee's members at those meetings are set out on page 6-7 of the 2021 Annual Report.

https://www.terramin.com.au/category/annual-reports/

Recommendation 2.2 - Recommendation followed

A listed entity should have and disclose a board skills matrix setting out the mix of skills and diversity that the board currently has or is looking to achieve in its membership.

The Board regularly evaluates the mix of skills, experience and diversity at the Board level. The Board believes that a highly credentialed Board, with a diversity of background, skills and perspectives, will be effective in supporting and enabling delivery of good governance for the Company and value for the Company's shareholders. The mix of skills comprised in the current Board, and that the Board would look to maintain, and to build on, includes:

• • mining industry expertise;

• • metallurgy and metals marketing expertise;

• • metal processing;

• • experience in dealing with joint ventures and high levels of government and regulators;

• • high level of business acumen;

• • technical expertise (including finance);

• • ability to think strategically;

• • project management;

• • governance experience and expertise.

The Board aspires to have a Board comprised of individuals'

diverse experience and expertise and will be mindful of this when making appointments which will also be based on merit.

Recommendation 2.3 - Recommendation followed

A listed entity should disclose:

• (a) the names of the directors considered by the board to be independent directors;

• (b) if a director has an interest, position, affiliation or relationship of the type described in Box 2.3 but the board is of the opinion that it does not compromise the independence of the director, the nature of the interest, position or relationship in question and an explanation of why the board is of that opinion; and

• (c) the length of service of each director.

In the opinion of the Board, to qualify as being "independent", a director must be independent of management and free of any business or other relationship which could materially interfere or could reasonably be perceived to interfere materially with the Director's independent exercise of their judgement.

Mr Angelo Siciliano and Mr Feng Sheng were appointed to the Board in January and April 2013, respectively and represent Asipac Group Pty Ltd (Asipac) and associated entities. Asipac is a substantial shareholder and financier of the Company. Mr Sheng is director and substantial shareholder of Asipac. Mr Siciliano is also the Chief Financial Officer of Asipac. As such, Mr Sheng and Mr Siciliano are not considered by the Board to be independent directors for the purpose of ASX Recommendation 2.3. Mr Sheng was appointed as Executive Chairman in January 2018.

Mr Kennedy, Mr McGuinness and Ms L Shi are considered by the Board to be independent directors, having regard to the factors set out above.

Recommendation 2.4 - Recommendation followed

A majority of the board of a listed entity should be independent directors.

The Company currently follows the recommendation of principle 2.4 as the Board has a majority of independent directors (3 out of the 5 directors are independent).

In accordance with ASX Recommendations, the independence of a director is assessed by determining whether the director is independent of management and free of any business or other relationship that could materially interfere with, or could reasonably be perceived to materially interfere with, the exercise of their unfettered and independent judgment. The test of whether a relationship or business is material is based on the nature of the relationship or business and on the circumstances and activities of the director. Materiality thresholds are considered by the Board from time to time.

As stated above, Mr Sheng and Mr Siciliano are not deemed to be independent for the purpose of the ASX Recommendation.

Mr Kennedy, Mr McGuinness and Ms L Shi are regarded as independent as they are free of any business or other

relationship that could materially interfere with, or could reasonably be perceived to materially interfere with, the exercise of their unfettered and independent judgement.

As the business develops, changes to and/or further appointments to the Board may be warranted and the Board will consider the need to appoint independent directors.

Recommendation 2.5 - Recommendation not followed

The chair of the board of a listed entity should be an independent director and, in particular, should not be the same person as the CEO of the entity.

Mr Sheng was appointed as Executive Chairman of Terramin in January 2018 assuming executive functions. In particular in the immediate term Mr Sheng has been focussing on finalising project approvals with the Algerian regulatory authorities, and the grant of the formal mining lease for the Tala Hamza project.

Recommendation 2.6 - Recommendation followed

A listed entity should have a program for inducting new directors and for periodically reviewing whether there is a need for existing directors to undertake professional development to maintain the skills and knowledge needed to perform their role as directors effectively.

All new directors are provided with an induction including comprehensive meetings with the Executive Management, and provision of information on the Company including Company and Board policies and other material documents.

All directors are expected to maintain the skills required to effectively discharge their obligations to the Company. Directors are encouraged to undertake continuing professional education and, if this involves industry seminars and approved education courses, where appropriate, this is paid for by the Company. The Company Secretary under the guidance of the Nomination & Remuneration Committee oversees the induction program for new directors.

Principle 3 - Act ethically and responsibly

Recommendation 3.1 - Recommendation followed

A listed entity should articulate and disclose its values.

One of the Company's core values is safety; it prioritises safety and health to people, the environment and community. The Company views sustainable and responsible business practices as an important long-term driver of performance and shareholder value and is committed to transparency, fair dealing, responsible treatment of employees and partners and positive interaction with the community.

Recommendation 3.2 - Recommendation followed

A listed entity should:

• (a) have and disclose a code of conduct for its directors, senior executives and employees; and

• (b) ensure that the board or a committee of the board is informed of any material breaches of that code.

The Company has a Code of Conduct that sets out the standards of behaviour expected of all its employees, directors, officers, contractors and consultants.

The Code of Conduct is located at:https://www.terramin.com.au/corporate/charters-policies/

Recommendation 3.3 - Recommendation followed

A listed entity should:

• (a) have and disclose a whistleblower policy; and

• (b) ensure that the board or a committee of the board is informed of any material incidents reported under that policy.

The Company has a Code of Conduct that sets out the standards of behaviour expected of all its employees, directors, officers, contractors and consultants.

The Code of Conduct is located at:https://www.terramin.com.au/corporate/charters-policies/

Recommendation 3.4 - Recommendation followed

A listed entity should:

• (a) have and disclose an anti-bribery and corruption policy; and

• (b) ensure that the board or committee of the board is informed of any material breaches of that policy.

The Company has a Code of Conduct that sets out the standards of behaviour expected of all its employees, directors, officers, contractors and consultants.

The Code of Conduct is located at:https://www.terramin.com.au/corporate/charters-policies/

Principle 4 - Safeguard integrity in corporate reporting

Recommendation 4.1 - Recommendation followed

The board of a listed entity should:

• (a) have an audit committee which:

  • (i) has at least three members, all of whom are non-executive directors and a majority of whom are independent directors; and

  • (ii) is chaired by an independent director, who is not the chair of the board, and disclose:

  • (iii) the charter of the committee;

  • (iv) the relevant qualifications and experience of the members of the committee; and

  • (v) in relation to each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or

• (b) if it does not have an audit committee, disclose that fact and the processes it employs that independently verify and safeguard the integrity of its corporate reporting, including the processes for the appointment and removal of the external auditor and the rotation of the audit engagement partner.