CORPORATE GOVERNANCE The provisions of the Listing Agreement to be entered into with the Stock Exchanges with respect to corporate governance will be applicable to us at the time of seeking in-principle approval of the Stock Exchanges. The Company have complied with the corporate governance requirements in accordance with Clause 49 (as applicable), including in relation to appointment of independent Directors to the Board, constitution of the Shareholders and Investor Grievance Committee and the reconstitution of the Audit Committee. The Company undertakes to take all necessary steps to comply with all the requirements of Clause 49 of the Listing Agreement to be entered into with the Stock Exchanges. Currently the Board has eight Directors, of which the Chairman of the Board is an Executive Director, and, in compliance with the requirements of Clause 49 of the Listing Agreement, the Company has four independent Directors. AUDIT COMMITTEE The audit committee ("Audit Committee") was constituted by the Board at its meeting held on July 18, 2007. The Audit Committee consists of Mr. S .R. Tagat (Chairman), Mr. S. A. Bohra, Mr. S. Rathinam. The Audit Committee is required to meet at least once in each quarter. The terms of reference of the Audit Committee are as follows: Appointment and changes to the statutory auditors and internal auditors. Assess the independence and objectivity of the auditors and to ensure that the nature and amount of non-audit work does not impair the auditor’s independence and objectivity. Fix the remuneration of the auditors. Review of reports of the statutory auditors and internal auditors. Review critical accounting policies and any changes to such policies. Review of quarterly and annual financial statements of the Company before they are presented to the Board. Review and approve any transactions with related parties. Review and assess the effectiveness of systems for internal financial control, financial reporting and risk management and compliance controls with management and auditors. Review any material breaches of compliance against regulations applicable to the Company. Review any concerns raised by the employees or others about possible improprieties in financial reporting, including management override of internal controls and financial irregularities involving management team members. Any other matter referred to the Audit Committee by the Board of Directors of the Company. COMPENSATION COMMITTEE The compensation committee ("Compensation Committee") was constituted by the Board at its meeting held on July 18, 2007. The Compensation Committee consists of Mr. B. G. Raghupathy (Chairman), Mr. M. Gopalakrishna and Mr. S. A. Bohra. The Compensation Committee is to meet at least once in each quarter. The terms of reference of the Compensation Committee are the administration of any employee stock option plans of the Company, including ESOP 2007. SHAREHOLDERS & INVESTORS GRIEVANCE COMMITTEE The shareholders and investors grievance committee ("Shareholders and Investors Grievance Committee") was constituted by the Board at its meeting held on July 18, 2007. The Shareholders and Investors Grievance Committee consists of Mr. M. Gopalakrishna (Chairman), Mr. Heinrich Bohmer and Mr. V. R. Mahadevan. The Shareholders and Investors Grievance Committee is to meet at least once in each quarter. Investor relations and redressal of shareholders grievances in general and including non-receipt of dividends, interest and non-receipt of balance sheet. Such other matters as may from time to time be required by any statutory, contractual or other regulatory requirements to be attended to by such committee. CODE OF CONDUCT This code of conduct is an integral part of BGR Energy's corporate governance philosophy. The objective of this Code of Conduct is to achieve highest level of transparency, integrity and equity with all the stakeholders. This code of conduct is applicable to all the Members of the Board, Presidents & CEOs, Executive Directors, CFO and Functional Heads (collectively called as Top Management and severally as Members of BGR Energy) and shall come in to force with effect from February, 1, 2008. This code is only a basic guideline and is not exhaustive. The members of top management are expected to act diligently whenever a doubt or question arises. They can also seek clarifications from the Company Secretary. Honesty and Integrity The top management shall act in accordance with highest standards of professional and personal integrity and honesty. Top management will practice fair play, equity, mutual trust and will act in good faith. Confidentiality The top management shall maintain absolute confidentiality of all the Company related proprietary data and information to which they have access in their official capacity. However, statutory disclosures if any required by law or regulation can be made available to outside agencies. Confidential data or information shall not be under any circumstances used for personal gain or the gain of a relative, friend or any other related party. Members of the top management shall execute a non-disclosure agreement and abide by the agreement during the official association with the company and for a period of 12 months thereafter. Conflict of Interest Members of the top management shall avoid any association or engagement which has even an apparent conflict of interest with the operations of the Company. Interest of stakeholders will supercede any other interest barring statutory requirements, environmental and safety matters. Members of top management shall not hold position of Director, Advisor with a competitor Company. Compliance with statute Members of the top management shall comply with all applicable statutory enactments, rules, regulations, guidelines, circulars etc. The members are expected to have adequate knowledge on such matters atleast in so far as they are required for the discharge of the entrusted functions and responsibilities. Transparency Members of the top management shall maintain highest standards of transparency in all their functions, interactions and dealings among themselves and with all stakeholders (shareholders, lenders, customers, vendors, employees, government agencies and the general public). Members of the top management shall make appropriate and adequate disclosures to disseminate sensitive information and data on matters of interest to the stakeholders. Top management will encourage whistle blower policy in good faith of any wrongful or detrimental conduct or concern and such member will be protected from any adverse repercussions. Members of the top management are encouraged to freely express their views to the Chairman and other Members on various matters relating to the business of the Company. The top management will nominate a lead Independent Director who will be a spokesperson of the top management to evolve from time to time better practices and improvement in code of conduct which will bring pride and credit to the Company and stakeholders. Interest of stakeholders Members of the top management will promote the interest of all stakeholders (shareholders, lenders, customers, vendors, employees, government agencies and the general public). Members of the top management will endeavour to adopt fair business principles and practices. Risk Management The top management will envisage, identify, mitigate and control potential risks through properly defined risk management frame work. Other matters Members of top management as a general practice shall not accept gifts in cash and kind of values exceeding Rs. 2,000 from a person related with the business of the company. Members of top management shall not share any information or data to the Print or Visual Media without proper authority of Chairman. The members of the top management shall endeavour to provide equal opportunities to all its employees, present and prospective without discrimination of caste, religion, age, sex etc. Members of top management shall not support directly or indirectly any political party, candidate or campaign. CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING This Code of Conduct is formulated in compliance with regulation 12(1) of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992. This is applicable to all Insiders of the Company. For the purpose of this code; "Insider" means any person who is or was connected with the company or is deemed to have been connected with the company and who is reasonably expected to have access, to unpublished price sensitive information in respect of shares of the company, or who has received or has had access to such unpublished price sensitive information. Connected Person” means a director, a deemed director, an employee, an officer or a person having a business or professional relationship with the company, who may be reasonably expected to have access to price sensitive information. This code is in continuation of CMD’s Circular dated 12–03–2008. 1.0 Compliance Officer The Board has appointed Company Secretary as the compliance officer reporting to the Managing Director. The compliance officer shall be responsible for setting forth policies and procedures and monitoring adherence to the rules for the preservation of "Price Sensitive Information", pre-clearing of all designated employees and their dependents trades (directly or through respective department heads) monitoring of trades and the implementation of the code of conduct under the overall supervision. The compliance officer shall also assist all the employees/directors in addressing any clarifications regarding SEBI (Prohibition of Insider Trading) Regulations, 1992 and the Companys’ code of conduct. The compliance officer shall maintain a record of the designated employees and any changes made in the list of designated employees. 2.0 Preservation of "Price Sensitive Information" Employees/directors shall maintain the confidentiality of all Price Sensitive Information. Employees/directors must not pass on such information directly or indirectly by way of making a recommendation for the purchase or sale of shares of the company. Need to know Price Sensitive Information is to be handled on a "need to know" basis, i.e. Price Sensitive Information should be disclosed only to those within the company who need the information to discharge their duty and whose possession of such information will not give rise to a conflict of interest or appearance of misuse of the information. Limited access to confidential information Files/Floppies/Diskette etc., containing confidential information shall be kept secure. Computer files must have adequate security of login and pass word, etc. Chinese Wall To prevent misuse of confidential information the company shall adopt a "Chinese Wall" policy which separates those areas of the organisation which routinely have access to confidential information, considered "inside areas" from those areas which deal with sale/marketing or other departments providing support services, considered "public areas". "Inside Areas" shall mean Sales, Finance, Corporate Office including Director, Chief Financial Officer, Company Secretary and Presidents. "Public Areas" shall mean area other than Inside Areas. The employees in the inside area shall not communicate any Price Sensitive Information to anyone in public area or any one. The employees in inside area when required may be physically or otherwise segregated from employees in public area. Demarcation of the various departments as inside area will be implemented appropriately when and where required. In exceptional circumstances employees from the public areas may be brought "over the wall" and given confidential information on the basis of "need to know" criteria, under intimation to the compliance officer. 3.0 Prevention of misuse of Price Sensitive Information Employees/directors shall not use Price Sensitive Information to buy or sell shares, whether for their own account, their relative’s account, organisation/firm's account or a client's account. The following trading restrictions shall apply for trading in securities: Pre clearance of trades All directors/officers/designated employees of the organisation/firm who intend to deal in the securities of the company above 500 shares shall pre-clear the transactions as per the pre-dealing procedure as described hereunder. An application may be made in the form as per Appendix – A, to the Compliance officer indicating the name and estimated number of securities that the designated employee/director intends to deal in, the details as to the depository with which he has a security account, the details as to the securities in such depository mode and such other details as may be required by the company. An undertaking shall be executed in favour of the company by such designated employee/directors incorporating, inter alia, the following clauses, as may be applicable : That the designated employee/director does not have any access or has not received any "Price Sensitive Information" upto the time of signing the undertaking. That in case the designated employee/director has access to or receives "Price Sensitive Information" after the signing of the undertaking but before the execution of the transaction he/she shall inform the Compliance officer of the change in his position and that he/she would completely refrain from dealing in the securities of the client company till the time such information becomes public. That he/she has not contravened the code of conduct for prevention of insider trading as specified by the company from time to time. That he/she has made a full and true disclosure in the matter. 4.0 Restricted period In order to monitor chinese wall procedures the company restrict trading in equity shares during such period, as may be determined by the Company. 5.0 Other restrictions All directors/designated employees shall execute their order within one week after the approval of pre-clearance is given. If the order is not executed within one week after approval is given, the employee/director must pre clear the transaction again. All directors/officers/designated employees shall hold their investments for a minimum period of 30 days or longer period as specified by the company in order to be considered as being held for investment purposes. The holding period shall also apply to purchases in the primary market (IPOs). In the case of IPOs, the holding period would commence when the securities are actually allotted. In case the sale of securities is necessitated by personal emergency, the holding period may be waived by the compliance officer after recording in writing his reasons in this regard. 6.0 Reporting Requirements for transactions in securities All directors/designated employees of the company shall forward following details of their transactions including the statement of dependent family members viz., spouse, son, daughter, father, mother, father-in-law, mother-in-law to the Compliance officer:- all holdings in shares by directors/officers/designated employees at the time of joining the organisation. half yearly statement of any transactions in shares The Compliance officer shall maintain records of all the declarations given by the directors/designated employees in the appropriate form for a minimum period of three years. The Compliance officer shall place before the Managing Director on a monthly basis all the details of the dealing in the shares by designated employees/directors of the company and the accompanying documents that such persons had executed under the pre-dealing procedure as envisaged in this code. 7.0 Penalty for contravention of code of conduct Any employee/director who trades in shares or communicates any information or counsels any person trading in shares, in contravention of the code of conduct may be penalised and appropriate action may be taken by the company. Employees/directors of the company who default in complying with the code of conduct may also be subject to disciplinary action by the company, which may include wage freeze, suspension, etc. The action by the company shall not preclude SEBI or Stock Exchanges from taking any action in case of violation of SEBI (Prohibition of Insider Trading) Regulations, 1992. 8.0 Information to SEBI in case of violation of SEBI (Prohibition of Insider Trading) Regulations In case it is observed by the company or compliance officer that there has been a violation of these Regulations, SEBI shall be informed by the compliance officer.