C) FMNL BOARD PRACTICES
The Board of Directors communicates formally approximately 4 to 6 times per year on an as needed basis to deal matters relating to the Company. Each Director serves for a term of one year or until the next annual meeting of the shareholders at which Directors are elected and qualified. The Company's last annual general meeting was held on March 25, 2010 and the next meeting will be held subject to Board approval as specified in the Company's Articles. The Company's executive officers are appointed by and serve at the pleasure of the Board of Directors.
Audit Committee
The Company's Audit Committee is composed of three individuals all present directors. The Audit Committee members of the Company as at December 31, 2011 are Mr. Mike Barrett, Mr. Chris Yergensen, and Mr. Kazunari Kohno. Messrs. Barrett, Yergensen, and Kohno during fiscal year 2011 and currently:
are considered an "independent" director as defined in Section 803A(2) of the American Stock Exchange Company Guide;
meets the criteria for independence as defined by Rule 10A-3 adopted by the SEC;
have not participated in the preparation of our financial statements or the financial statements of any of our current subsidiaries at any time during the past three years; and
is able to read and understand fundamental financial statements.
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Our Board of Directors has determined that the audit committee has at least one member, Mr. Barrett who qualifies as an Audit Committee Financial Expert, as defined by relevant SEC rules. As previously stated, Mr. Barrett is an independent director. The Audit Committee is responsible for reviewing the Company's financial reporting procedures, internal controls, and the performance of the Company's external auditors. The functions of the Audit Committee also includes selecting, appointing, retaining, compensating and overseeing our independent auditors, deciding upon and approving in advance the scope of audit and non-audit assignments and related fees, reviewing accounting principles we use in financial reporting, and reviewing the adequacy of our internal control procedures, including the internal audit function. The committee is also responsible for reviewing the annual financial statements prior to their approval by the Board of Directors. The Board has adopted a charter for the Audit Committee in the fall of 2007.
Remuneration Committee
The Company does not have a Compensation Committee.
Service Contracts
The Company and its subsidiaries do not have any service agreements with any of the directors of the Company providing for benefits upon termination of employment
