Executive Compensation Committee Charter
The Executive Compensation Committee’s (the “Committee”) basic responsibility is to review the performance and development of the Company’s management in achieving corporate goals and objectives and to assure that the Company’s executive officers are compensated effectively in a manner consistent with the strategy of the Company, competitive practice, sound corporate governance principles and stockholder interests. Toward that end, the Committee will review and approve all compensation to executive officers.
COMPOSITION OF THE COMMITTEE
The Committee will consist of not less than two directors, each of whom will be an “independent director” as required by the rules of The Nasdaq Stock Market (“Nasdaq”), including the additional independence requirements specific to compensation committee membership, a “non-employee director” within the meaning of Rule 16b-3 issued by the United States Securities and Exchange Commission (“SEC”), and an “outside director” within the meaning of Section 162(m) of the United States Internal Revenue Code of 1986, as amended (“Section 162(m)”). Each appointed Committee member will be subject to annual reconfirmation and may be removed by the Board of Directors (the “Board”) at any time.
RESPONSIBILITIES AND DUTIES
The Committee shall:
1. Review annually and approve the Company’s compensation strategy to ensure that it promotes stockholder interests and supports the Company’s strategic and tactical objectives, and that it provides appropriate rewards and incentives for management and employees of the Company, including review of compensation-related risk management.
2. Review annually and approve corporate goals and objectives relevant to executive compensation and evaluate performance in light of those goals.
3. Review annually and determine the individual elements of total compensation for the Chief Executive Officer and during such voting and deliberations the Chief Executive Officer will not be present.
4. Review annually and determine the individual elements of total compensation for all other “executive officers” within the meaning of Rule 3b-7 issued by the SEC and “officers” within the meaning of Rule 16a-1(f) issued by the SEC (together with the Chief Executive Officer, the “Officers”).
5. Review and discuss the “Compensation Discussion and Analysis” disclosure prepared pursuant to the requirements of Item 402(b) of Regulation S-K (or any successor disclosure item), and based on such review and discussion recommend to the Board whether such “Compensation Discussion and Analysis” disclosure should be included in the Company’s annual report on Form 10-K, proxy statement, information statement or similar document.
6. Communicate in the annual Board Compensation Committee Report to stockholders the disclosures required by Item 407(e)(5) of Regulation S-K (or any successor disclosure item).
7. Approve any and all special perquisites, special cash payments and other special compensation and benefit arrangements for the Company’s Officers.
8. Review and recommend compensation for non-employee members of the Board, including but not limited to the following elements: retainer, meeting fees, committee fees, committee chair fees, equity or stock compensation, deferred compensation, benefits and perquisites.
9. With sole and exclusive authority, make and approve equity grants and other discretionary awards under the Company’s equity incentive plans to all persons who are Officers.
10. Grant equity awards and other discretionary awards under the Company’s equity incentive plans to all other eligible individuals in the Company’s service.
11. Amend the provisions of the Company’s equity incentive plans, to the extent authorized by the Board, and make recommendations to the Board with respect to incentive compensation and equity-based plans.
12. Approve for submission to the stockholders equity incentive plans or amendments thereto.
13. Provide general oversight of the Company’s employee benefit plans. Responsibility for day-to-day administration of the employee benefit plans and the investment of any assets, including the preparation and filing of all government reports and the preparation and delivery of all required employee materials and communications, will be the sole responsibility of Company personnel.
14. Ensure that incentive compensation plans are administered in a manner consistent with the Company’s compensation strategy and the terms of such plan, including but not limited to the following: participation, target annual incentive awards, corporate financial goals, actual awards paid to Officers and qualification to the extent required by Section 162(m).
15. Review matters related to management performance, compensation and succession planning (including periodic review and approval of Chief Executive Officer and other Officer succession planning) and executive development for executive staff.
16. Approve separation packages and severance benefits for Officers.
17. Have full access to the Company’s executives and personnel as necessary to carry out its responsibilities.
18. Obtain such advice, data or other resources necessary to perform its duties hereunder, and the Committee has the authority to obtain external consultant reports or published salary surveys, and in its sole discretion may retain or obtain the advice of a compensation consultant, legal counsel or other advisors to assist it in connection with it functions hereunder. If the Committee retains the services of a compensation consultant, legal counsel or other advisor to assist it in connection with its functions, the Committee shall be directly responsible for the appointment, compensation and oversight of the work of any such advisor. The Company shall provide appropriate funding, as determined by the Committee, for payment of reasonable compensation to such advisors. Selection of, or receipt of advice from, any compensation consultant, legal counsel or other advisor shall be made only after the Committee takes into consideration factors relevant to that advisor’s independence, including, but not limited to, all factors specified by the rule 10C-1(b)(4) promulgated under the United States Securities Exchange Act of 1934, as amended.
19. Have responsibility for the review and approval of all reports and summaries of Officer and Director compensation policies and decisions as may be appropriate for operational purposes or as may be required under applicable law.
20. Perform any other activities consistent with this Charter, the Company’s Bylaws and governing law as the Committee or the Board deems necessary or appropriate.
21. Review at least annually the Committee Charter for adequacy and recommend any changes to the Board.
22. Report to the Board on the major items covered at each Committee meeting.