CORPORATE GOVERNANCE

Compensation Committee Charter

Purpose

The Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of the Company shall have responsibility over matters relating to the fair and competitive compensation of executives, employees and non-employee directors of the Company, as well as matters relating to all other benefit plans.

Compensation and Qualifications

Members of the Committee shall be appointed by the Board as necessary to fill vacancies. The Board shall designate one member of the Committee as Chair. The Compensation Committee shall be composed of not less than three Board members, each of whom shall be:

  • an “independent director” as required by the listing standards established by The Nasdaq Stock Market, Inc. (“NASDAQ”);Prepare the Audit Committee report that SEC proxy rules require to be included in the Company’s annual proxy statement.

  • a “non-employee director” within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934; and

  • an “outside director” within the meaning of Section 162(m) of the Internal Revenue Code, as amended.

The Board may remove a member of the Committee at any time with or without cause.

Dutites and Responsibilities

In addition to any other duties and responsibilities listed in this charter, the duties and responsibilities of the Compensation Committee shall include:

  • Review annually the Company’s overall compensation strategy to ensure that employees of the Company are rewarded appropriately for their contributions to the Company’s growth and profitability. In doing so, the Committee may consider such factors as it deems appropriate under the circumstances, such as maintaining competitiveness, retention of executive and key employees, implementing capital improvements, expanding markets, pursuing growth opportunities and achieving other business and operating objectives, both long- and short-term.

  • Review annually the Company’s goals and objectives relevant to the compensation of the Company’s executive officers and evaluate executive performance in light of those goals and objectives.

  • Review annually and determine the compensation of the Company’s chief executive officer (“CEO”) including the individual elements of such compensation, based on an evaluation of such executives’ performance in light of the goals and objectives established by the Committee. In determining the long-term component of CEO compensation, the Compensation Committee should consider the Company’s performance and relative shareholder return, the value of similar incentive awards to chief executive officers at comparable companies and the awards given to the CEO in past years.

  • Producing a compensation committee report on executive compensation as required by the Securities and Exchange Commission (the “SEC”) to be included in the Company’s annual proxy statement or annual report on Form 10-K filed with the SEC, and overseeing the preparation of the “Compensation Discussion & Analysis” for inclusion such documents.

  • Approve any perquisites, special bonus payments or other special compensation or benefit arrangements for the Company’s executive officers.

  • Approve a pool of stock options and other discretionary awards to be used by the CEO under the Company’s stock option or other equity plans to any other eligible individuals.

  • Approve recommendations by the CEO with respect to non-CEO equity-based plans, including employee stock option and benefit plans and then obtain approval of all such grants, including the exercise prices and vesting schedule, from the entire Board.

  • Review and recommend to Board compensation for non-employee members of the Board, including but not limited to retainer fees, meeting fees, committee fees, equity or stock compensation, benefits and perquisites.

  • Manage and control the operation and administration of the Company’s stock option plans and have the power to interpret and apply the Company’s stock option plans and make regulations for carrying out the purpose of such plans.

  • With sole and exclusive authority, make and approve stock option grants and other discretionary awards under the Company’s stock option or other equity incentive plans to the CEO.

Reporting to the Board

The Compensation Committee shall make regular reports to the Board. The Compensation Committee shall make additional reports to the Board as the Board requests.

Committee Consultants and Advisors

The Compensation Committee shall have authority, without further approval from the Board, to retain and terminate, as it deems appropriate, compensation consultants or advisors to assist in the Committee’s evaluation of compensation issues and shall have sole authority to approve such consultants’ fees and retention arrangements.

Meeting

The Committee shall meet when deemed necessary and desirable by the Committee or its Chair, and at least once per year. The Committee may invite such members of management and other persons to its meetings as it may deem appropriate, except that the CEO may not be present during deliberations or voting concerning CEO compensation. The Committee shall keep minutes of its meetings and report them to the Board.

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