The Compensation Committee is a standing committee of the Board of Directors. The Board has delegated its responsibilities with respect to the compensation of the Company’s Chief Executive Officer (the “CEO”) and other executive officers to the Committee. The Committee is responsible for the establishment, implementation and periodic review and evaluation of an executive compensation program for such employees (the “executive compensation program”) which is designed to be competitive with other programs adopted by comparable companies and to achieve the following objectives: (i) to attract, retain and motivate highly talented employees; (ii) to align employees’ interests with the interests of the Company’s stockholders; and (iii) to provide an incentive to employees to cause the Company to achieve financial goals and strategic objectives intended to increase shareholder value. The Committee is also responsible for assisting the Company with succession planning for the CEO and key executive officers.
In addition, the Committee is responsible for reviewing and evaluating the amount, nature and structure of the compensation paid to non-employee members of the Board of Directors for their service as members and for recommending such changes as it may deem appropriate to the Board.
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This Charter governs the operations of the Committee. The Committee shall have a minimum of three members. Each member of the Committee shall qualify as an “independent director” under the listing standards of the New York Stock Exchange, and as a “non-employee director” for purposes of Rule 16b-3 under the Securities Exchange Act of 1934, as amended, and as an “outside director” for purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended. In addition, no member may be a part of a compensation committee interlock within the meaning of SEC Regulation S-K. The Board of Directors shall appoint, and may remove, any member of the Committee and designate the Committee Chair upon recommendation of the Nominating/Corporate Governance Committee.
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The Committee shall have such resources (including corporate staff, and outside consultants and experts) as the Committee may deem necessary or advisable, and such authority as may be reasonable or necessary to discharge its duties and responsibilities under this Charter. The Committee shall have the sole authority to retain or terminate the services of outside consultants and experts, including the authority to approve their fees and other retention terms. The Company shall pay all expenses incurred by the Committee in carrying out its responsibilities. The Committee shall have the authority to delegate its responsibilities to sub-committees.
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The Committee shall have the following principal duties and responsibilities:
A. Review the Company’s executive compensation program to determine whether the overall program remains competitive and serves its intended purposes, and make recommendations to the Board as appropriate.
B. Consider the relationship between the Company’s compensation policies and practices for all employees and risk, including whether such policies and practices (1) encourage imprudent risk taking, and/or (2) would be reasonably likely to have a material adverse effect on the Company.
C. Review trends in executive compensation, oversee the development of new compensation plans (including annual and multi-year cash and equity-based incentive programs) and revisions to existing plans, and recommend such new plans, or such revisions to existing plans, as the Committee may deem appropriate to the Board for approval.
D. Review and approve corporate goals and objectives relevant to CEO
compensation annually, evaluate the CEO’s performance in light of those goals and objectives with the assistance of all other independent members of the Board, and based on the evaluation, determine and approve the CEO’s compensation, including salary, cash and equity-based incentive awards and any personal benefits. In determining the incentive component of CEO compensation, the Committee should consider the Company’s performance and relative shareholder return, the value of similar incentive awards to CEOs at comparable companies, the awards given to the CEO in past years, and such other factors as it deems necessary or advisable.
E. Review and approve the compensation program, including salary, cash and equity-based incentive awards and any personal benefits, for other executive officers. In determining the incentive component, the Committee should consider factors similar to those considered for CEO incentives.
F. Review and make recommendations to the Board for equity awards to the CEO and other executive officers.
G. Act on behalf of the Board to administer all executive compensation plans (including cash and equity-based incentive compensation plans) for the CEO and other executive officers.
H. Establish guidelines relating to appropriate minimum levels of ownership of the Company’s stock by the CEO and other executive officers and periodically monitor compliance with such guidelines.
I. Evaluate the compensation of non-employee members of the Board of Directors on an annual basis and make adjustments as necessary consistent with the Company’s compensation policy and competitive conditions.
J. Review and discuss the Company’s management succession plan for the CEO and other key executive officers with other non-employee members of the Board on an annual basis.
K. Review and discuss the Compensation Discussion and Analysis (“CD&A”), which is to be included in the Company’s annual proxy statement, with management, and based on that review, recommend to the Board whether to include the CD&A in the proxy statement in accordance with applicable SEC rules and regulations.
L. Prepare the disclosure required by the rules of the SEC (Item 407(e)(5) of Regulation S-K) regarding the CD&A for inclusion in the Company’s annual proxy statement.
M. Evaluate the performance of the Committee on an annual basis.
N. Review and assess the Committee’s Charter at least once each year and recommend such changes as the Committee may deem appropriate to the Board of Directors for approval.
O. Report on the activities of the Committee to the Board on a regular basis.
P. Perform such other duties and responsibilities as may be delegated to the Committee from time to time by the Board.
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