Committee Charters

Santa Fe Gold Corporation Compensation Committee Charter

Purposes
The Compensation Committee (the "Committee") is a standing committee of the Board of Directors (the "Board") of Santa Fe Gold Corporation (the "Company"). The purposes of the Committee are to (i) review and approve corporate goals and objectives relevant to compensation of the Company's chief executive officer, evaluate the chief executive officer's performance in light of those goals and objectives, and, together with the other independent members of the Board, determine and approve the chief executive officer's compensation level based on this evaluation; (ii) recommend the compensation of the Company's other executive officers for approval by the Board; (iii) assist the Board in establishing compensation policies and incentive and equity-based plans and awards that will enable the Company to attract, motivate and retain high quality leadership and compensate them in a competitive manner consistent with the interests of the Company's shareholders; and (iv) produce an annual report on executive compensation for inclusion in the Company's proxy statement or annual report as required by the Securities and Exchange Commission.

Organization
Charter
At least annually, this charter shall be reviewed and reassessed by the Committee and any proposed changes shall be submitted to the Board for approval. This charter and all amendments hereto shall be publicly disclosed as required by law or the listing standards of the New York Stock Exchange ("NYSE").

Membership on Committee
The Committee shall be comprised of at least two members. Each member of the Committee and a Committee Chairman shall be appointed by the Board on the recommendation of the Nominating and Corporate Governance Committee and shall meet the independence requirements of applicable law and the AMEX listing standards, the requirements of an "outside director" for purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended, and the requirements of a "non-employee director" for purposes of Section 16 of the Securities Exchange Act of 1934, as amended. Committee members may be removed by the Board. The Board shall annually appoint a Chairman for the Committee.

Meetings
The Committee shall establish a schedule of meetings, which shall include at least one meeting each year; additional meetings may be scheduled with notice as required. The Committee may invite members of management or any director to attend its meetings. The Committee may hold executive sessions without management present. Meetings may be held in person, telephonically, via video conferencing, or any combination of the foregoing. Attendance at a meeting by any one of those media shall be effective.

Quorum; Action by Committee; Written Consent
A quorum at any Committee meeting shall be at least a majority of the members. All determinations of the Committee shall be made by a majority of its members present at a meeting duly called and held. Any decision or determination of the Committee reduced to writing and signed by all of the members of the Committee consenting to such action without a meeting shall be effective as if it had been made at a meeting duly called and held.

Agenda, Minutes and Reports
The Chairman of the Committee shall be responsible for establishing the agenda for the meetings of the Committee. Any member of the Committee may suggest agenda items to the Chairman. An agenda, together with materials relating to the subject matter of each meeting, will be sent to members of the Committee prior to each meeting. Minutes for all meetings of the Committee shall be prepared to document the Committee's deliberation and actions. The minutes shall be circulated in draft form to all Committee members to ensure an accurate final record, and should be submitted for approval at a subsequent meeting of the Committee. The approved minutes shall be signed by the Committee Chairman and maintained by the secretary of the Company. The Committee shall make regular reports to the Board.

Committee Performance Evaluation
The Committee shall evaluate its performance on an annual basis and develop criteria for such evaluation.

Duties and Responsibilities
The duties and responsibilities of the Committee as are follows:
Chief Executive Officer Compensation
The Committee shall review and approve annually the corporate goals and objectives relevant to the chief executive officer of the Company and evaluate the chief executive officer's performance in light of these goals and objectives.

  • The Committee, either as a Committee or together with the other members of the Board that meet the independence standards required by applicable law and the AMEX listing standards (as directed by the Board), shall determine and approve the chief executive officer's compensation level (including salary and awards of long-term incentive compensation, pursuant to both cash incentive plans and stock-based plans) based on this evaluation. In determining long-term incentive compensation for the chief executive officer, the Committee should consider, among other factors, the Company's performance and relative shareholder return (or other criteria) during such periods as the Committee may deem appropriate; the value of similar incentive awards to chief executive officers at comparable companies and the awards given to the Company's chief executive officer in past years.
  • The Committee shall communicate in its annual Compensation Committee Report to shareholders the factors and criteria on which the chief executive officer's compensation for the last year was based, including the relationship of the Company's performance to the chief executive officer's compensation.

Compensation of Other Executive Officers

  • The Committee shall recommend the compensation levels (including salary and awards of long-term incentive compensation, pursuant to both cash incentive plans and stock-based plans) for all other officers (as that term is defined in Section 16 of the Exchange Act of 1934, as amended, and Rule 16a-1 there under) (referred to collectively herein as "executive officers") of the Company other than the chief executive officer.
  • The Committee shall communicate in its annual Compensation Committee Report to shareholders the specific relationship of corporate performance to the compensation of other executive officers.

Recommendation of Compensation Policies

  • The Committee shall review from time to time and recommend to the Board the Company's compensation policies to ensure that the Company's management is rewarded appropriately for its contributions to Company and that the Company's executive compensation strategy supports organizational objectives and shareholder interests.
  • The Committee shall review and recommend to the Board (and the Company's shareholders, where required by law or the AMEX listing standards) the Company's incentive compensation and equity plans, and actual awards or payments made to executive officers; provided, however, that awards to the Company's chief executive officer shall be subject to approval by the independent directors.

Board Compensation

  • The Committee shall periodically review and make recommendations to the Board with respect to the compensation of Board members and committees of the Board.

Employment and Severance Arrangements

  • The Committee shall review and make a recommendation to the Board with respect to its approval of any employment and severance arrangements and benefits of the chief executive officer and executive officers in light of practices at comparable companies and any benefits received by the Company in connection with such arrangements.

Access to Records, Consultants and Others

  • If the Committee deems it necessary or appropriate, it may hire outside advisors or consultants to assist the Committee with its work, at the Company's expense and upon terms established by the Committee. The Committee shall have the sole authority to retain and terminate any compensation consultant to be used to assist in the evaluation of trustee, chief executive officer or executive officer compensation and shall have sole authority to approve the consultant's fees and other retention terms. The Committee shall also have authority to commission compensation surveys or studies as the need arises. The Committee is empowered, without further action by the Board, to cause the Company to pay the compensation of such consultants as established by the Committee. In discharging its responsibilities, the Committee shall have full access to any relevant records of the Company and may also request that any employee or any other person, meet with any members of, or consultants and advisors to, the Committee.

Delegation
The Committee may delegate any of its responsibilities to a subcommittee comprised of two or more members of the Committee, and may delegate authority to make grants and awards under any equity-based plan to the chief executive officer with such limitations as determined by the Committee and as may be required by law or the listing standards of AMEX.

Other Duties and Responsibilities
The Committee shall also carry out such other duties and responsibilities that may be delegated to it by the Board from time to time.

Santa Fe Gold Corporation Audit Committee Charter
May 2007

Role
The Audit Committee (the "Committee") of the Board of Directors assists the Board of Directors (the "Board") of Santa Fe Gold Corporation (the "Company") in fulfilling its responsibility for oversight of the quality and integrity of the accounting, auditing, and reporting practices of the Company and such other duties as directed by the Board. The Committee's role includes a particular focus on the qualitative aspects of financial reporting to the shareholders of the COMPANY, and on the Company's processes to manage business and financial risk, and for compliance with significant applicable legal, ethical, and regulatory requirements. The Committee is directly responsible for the appointment, compensation, and oversight of the independent public accounting firm engaged to prepare or issue an audit report on the financial statements of the Company.

Membership
The membership of the Committee shall consist of at least two directors who are able to read and understand fundamental financial statements, including the Company's balance sheet, income statement and cash flow statement. At least one member of the Committee shall be a financial expert. The Board shall determine whether an Audit Committee member is a financial expert in accordance with the National Association of Securities Dealers, Inc.'s (the "NASD") Marketplace Rules and the federal securities laws. Each member shall be free of any relationship that, in the opinion of the Board, would interfere with his or her individual exercise of independent judgment. Applicable laws, rules and regulations shall be followed in evaluating a member's independence. The chairperson shall be appointed by the full Board.

Communications/Reporting
The independent public accounting firm shall report directly to the Committee. The Committee is expected to maintain free and open communication with the independent public accounting firm, the internal auditors, if any, and the Company's management. This communication shall include private executive sessions, at least annually, with each of these parties. The Committee chairperson shall report on Committee activities to the full Board.

Education
The Company is responsible for providing the Committee with educational resources related to accounting principles and procedures, current accounting topics pertinent to the Company and other material as may be requested by the Committee. The Company shall assist the Committee in maintaining appropriate financial literacy.

Authority
In discharging its oversight role, the Committee is empowered to investigate any matter brought to its attention, with full power to retain outside counsel or other experts for this purpose.

Responsibilities
The Committee's specific responsibilities in carrying out its oversight role are delineated in the Audit Committee Responsibilities Checklist. The Committee will review and update this checklist at least annually. The responsibilities checklist will be updated to reflect changes in regulatory requirements, authoritative guidance, and evolving oversight practices. As the compendium of Committee responsibilities, the most recently updated responsibilities checklist will be considered to be an addendum to this charter.

The Committee relies on the expertise and knowledge of management, the internal auditors and the independent public accounting firm in carrying out its oversight responsibilities. Management of the Company is responsible for determining that the Company's financial statements are complete, accurate and in accordance with generally accepted accounting principles. The independent public accounting firm is responsible for auditing the Company's financial statements. It is not the duty of the Committee to plan or conduct audits, to determine that the financial statements are complete and accurate and are in accordance with generally accepted accounting principles, to conduct investigations, or to assure compliance with laws and regulations or the Company's internal policies, procedures and controls.
Audit Committee Responsibilities Checklist

 

WHEN PERFORMED
Audit Committee Meetings
 

RESPONSIBILITIES

Winter

Spring

Summer

Fall

As Needed

1.

The Committee shall meet four times per year or more frequently as circumstances require. The Committee may ask members of management or others to attend the meeting and provide pertinent information as necessary. The agenda for Committee meetings will be prepared in consultation between the Committee chair (with input from the Committee members),
management and the independent public accounting firm.

X

X

X

X

X

2.

Review the periodic reports of the COMPANY with the management and the independent public accounting firm prior to filing of the reports with the SEC. In connection with such review, the Committee shall review management's disclosure under Section 302 of the Sarbanes-Oxley Act and the contents of any certificates filed under Section 302 and 906 of the Sarbanes-Oxley Act.

X

X

X

X

3.

Review the Company's annual financial statements with the independent public accounting firm and any related significant findings and recommendations of the independent public accountants together with management's responses thereto. Meet with the independent public accounting firm in executive session to discuss any matters that the Committee or the independent public accounting firm believe should be discussed privately with the Committee.

X

4.

Confirm annually the independence of the independent public accounting firm through receipt from the independent public accounting firm and review of a formal written statement delineating all relationships between the independent public accounting firm and the Company, consistent with Independence Standards Board Standard 1, and actively engaging in a dialogue with the independent public accounting firm with respect to any disclosed relationships or services that may impact the objectivity and independence of the independent public accounting firm. Review with the Chief Executive Officer, the Chief Financial Officer and the independent public accounting firm the audit scope and plan.

5.

Verify the Committee consists of a minimum of three members who are financially literate, including at least one member who is a financial expert and that each Committee member is "independent", as such terms may be defined or explained by the NASD or the SEC.

1.

Review and update the Audit Committee Responsibilities Checklist annually.

X

2.

Meet with the independent public accounting firm in executive session to discuss any matters that the Committee or the independent public accounting firm believe should be discussed privately with the Committee.

3.

Establish and review procedures for the receipt, retention and treatment of concerns or complaints regarding accounting, internal accounting controls or auditing matters, and ensuring the confidential and anonymous treatment of submissions by persons of complaints or concerns regarding accounting, internal accounting controls or auditing matters.

X

4.

Provide a report in the Company's annual proxy that includes the Committee's review and discussion of matters with management and the independent public accounting firm.

5.

Have sole authority to appoint, determine funding for, oversee and fire the
independent public accounting firm and to approve in advance all permissible
non-audit services by such firm.

X

6.

Provide an open avenue of communication between the internal auditors, if any, the independent public accounting firm, the Chief Financial Officer and the Board. Report Committee actions to the Board with such recommendations as the Committee may deem appropriate.

7.

Review with management any significant changes to generally accepted accounting policies or standards. Confirm compliance with codes of conduct and standards.

8.

Review with the Chief Executive Officer, the Chief Financial Officer and the independent public accounting firm any disagreements related to the conduct of the Company audit and the Company's critical accounting policies.

X

9.

The Committee will perform such other functions as assigned by law, the
Company's governance documents, as each may be amended, supplemented or restated, or the Board.

X

10.

The Committee shall have the power to conduct or authorize investigations into any matters within the Committee's scope of responsibilities. The Committee has the authority to engage and determine funding for independent counsel, accountants and other advisors to assist it in the conduct of any investigation.