ASX Additional Information

Shareholder Information

Issued Capital
As at 29th August, 2008 the Company had on issue 116,629,734 ordinary shares and 500,000 partly paid shares issued at a price of 10c per share and paid to 1c on issue. The partly paid shares are not quoted on any exchange.

Substantial Shareholders
As at 29th August 2008 the Company had the following substantial shareholders:
Mr. Nicholas Garling                   21,621,306 shares
N Garling – Super Fund A/C        7,186,725 shares
Mr. Max Garling                         8,566,747 shares

Distribution of Shareholders
There were 1,247 shareholders. Each shareholder is entitled to one vote for each share held.
The analysis of the number of holders was:



There were 156 shareholders who held less than a marketable parcel. The top twenty holders held 53.29 % of the Company’s share capital.

Quoted Options
As at 29th August, 2008 the Company had 62,881,932 options outstanding over unissued shares exercisable at 25c and expiring 31.12.08 issued to 579 holders.

Distribution of Option holders
The analysis of the number of holders was:



Audit and Remuneration Committee
The directors have considered the formation of an audit committee and a remuneration committee in order to enhance the company’s corporate governance regime in accordance with recommendations 4.2 and 9.2. However, given the number of directors on the board, exclusion of one or more directors from each committee would detrimentally and unnecessarily limit the available skills. Consequently, it has been determined that the full board will take responsibility for the issues which would be expected to be within the purview of these committees.

The company’s remuneration policy is disclosed in the Remuneration Report contained within the Directors’ Report.

An external audit is undertaken by Graham Abbott Associates, Chartered Accountants.
The external auditor attends the annual general meetings of the company and is available to answer shareholder questions.

Independent Professional Advice
Each director has the right to seek independent professional advice, in relation to matters arising in the conduct of his duties, at the economic entity’s expense, subject to prior approval of the Chairman which is not to be unreasonably withheld.

Continuous Disclosure
The company has established policies and procedures to ensure compliance with ASX Listing Rule continuous disclosure requirements. All proposed company announcements are circulated to each director for their input before release to
the market.

Securities Trading Policy
All directors, office – holders and employees are bound by the company’s securities trading policy which prohibits trading in Morning Star Gold NL’s securities while they are in possession of price – sensitive information until it has been released to the market and adequate time has been given for this to be reflected in the security’s price.

The Environment
The company also has in place an Environment Policy under which the company, in seeking to locate and develop mineral resources, is committed to achieving a high standard of environmental protection. This will be achieved while ensuring that the needs of the community and the values attached to natural and physical resources are taken into account in company planning and the way in which business is conducted.

Shareholders
The board aims to ensure that all shareholders are informed of significant developments through regular shareholders communications. These include the Annual Report and distribution of material covering major events when appropriate.

Other Information
Further information relating to the company’s corporate governance practices and policies has been made publicly available on the company’s website at www.morningstargold.com.au You can also contact the company at the following email info@morningstargold.com.au

Corporate Governance Statement

Unquoted Securities
As at 29th August, 2008 the Company had 500,000 1c paid partly paid shares on issue to one director.

Unless disclosed below, all the best practice recommendations of the ASX Corporate Governance Council have been applied for the entire financial year ended 30th June, 2008.

Corporate Conduct
All directors, office – holders, employees and consultants are expected to act with the utmost integrity and objectivity and to enhance the reputation and performance of the company.

The Board of Directors
The skills, experience and expertise relevant to the position of each director who is in office at the date of the annual report are detailed in the Directors’ Report.

The board held six formal meetings throughout the financial year.

At the date of this report the board comprises five directors; two executive directors, being the Chief Executive Officer and the Chairman and three non-executive directors, as follows:

Max Michael Garling	Executive Chairman	Appointed 19.12.03
Nicholas Mark Garling	MD / Chief Executive Officer	Appointed 20.3.07
Malcolm Harvey Bird	Non-Executive Director	Appointed 18.6.87
Jeffrey Wayne Williams	Non-Executive, Independent Director	Appointed 26.02.04
Peter Gilbert Jackson	Non-Executive Director	Appointed 10.03.08

Jeffrey Wayne Williams is considered to be an independent director as he is neither a substantial shareholder in the company nor receives remuneration from the company other than in relation to his position as a director.

The board is responsible for the overall Corporate Governance of the company and its primary functions include:

• the strategic direction of the company approval of the long term goals for management and monitoring the achievement of these goals on behalf of the shareholders;
• the approval of the annual and half-yearly financial statements;
• the review and adoption of annual budgets for the financial performance of the company and monitoring the results throughout the year;
• ensuring the company has implemented adequate systems to monitor compliance activities, risk management and health and safety requirements.

The company does not comply with best practice recommendations 2.1: “A majority of the board should be independent directors”; 2.2: “The chairperson should be an independent director”; and 2.4: “The board should establish a nomination committee”. However, the board believes that for a company of its size and considering the extent of its operations that its present composition provides for efficient decision – making required by the company in its current circumstances. |

Also, the board does not believe that the formal establishment of a nomination committee is warranted by its size, as in effect, the board as a whole acts as the nomination committee.
The board’s nomination of directors is dependent on the candidate’s range of skills and experience relevant to the business of the company.

The Chairman has conducted a performance evaluation for the board and its members during the financial year using generally accepted industry practises.