Director Qualifications
A majority of the members of the Board of Directors must meet the criteria for independence required by the Securities and Exchange Commission. The Board is responsible for reviewing, on an annual basis, the requisite skills and characteristics required for new Board members as well as the composition of the Board as a whole. This assessment will include a review of (1) members’ qualification as independent, as well as consideration of a potential candidate’s experience, areas of expertise and other factors relative to the overall composition of the Board and (2) the make-up of Board membership due to changes in director responsibilities. Nominees for directors will be selected by independent members of the Board.
Directors should advise the Chairman of the Board in advance of accepting an invitation to serve on another public company board.
Term limits are not established by the Board. Changes or additions to Board membership will be based on the need to bring new ideas and talents to the Board and balanced vs maintaining the valuable experience and insight into the Company and its operations provided by senior Board members.
Director Responsibilities
The basic responsibility of the directors is to exercise their business judgment to act in what they reasonably believe to be in the best interests of the Company and its shareholders. In discharging this obligation, directors should be entitled to rely on the honesty and integrity of the Company’s senior executives and its outside advisors and auditors. The directors will also be entitled to be covered by reasonable directors’ and officers’ liability insurance purchased by the Company on their behalf; to the benefits of indemnification to the fullest extent permitted by law and by the Company’s articles of incorporation, bylaws, and any indemnification agreements; and to exculpation as provided by state law and the Company’s articles of incorporation.
Directors are expected to attend Board meetings and meetings of Board committees on which they serve, to spend the time needed to discharge their Board duties in a reasonable manner, and to meet as frequently as necessary to properly discharge their responsibilities. Information and data that are important to the Board’s understanding of the business to be conducted at Board or committee meetings should generally be distributed in writing to the directors before the meeting, and directors should review these materials in advance of the meeting.
The Chairman should establish the agenda for each Board meeting. Each Board member may suggest the inclusion of items on the agenda. Each Board member also may raise at any Board meeting subjects that are not on the agenda for that meeting. The Board will review the Company’s long-term strategic and financial plans, along with annual budgets and other principal issues, during at least one Board meeting each year.
Independent directors shall meet in regularly convened executive sessions without management directors or management participation. The Company shall also disclose the procedure by which interested parties may communicate directly and confidentially with the presiding director or independent directors as a group.
The Board believes that the management speaks for the Company. Individual Board members, from time to time, may meet or otherwise communicate with various constituencies that are involved with the Company. It is expected, however, that Board members would do this with the knowledge of the management and, absent unusual circumstances or as contemplated by the committee charters, only at the request of management.
Board Committees
The Board at all times will have an Audit Committee and a Compensation Committee. All members of these committees will be independent directors under the criteria established by the Securities and Exchange Commission. Committee members will be appointed by the Board with consideration of the desires of individual directors. Consideration shall be given to rotating committee members periodically but will not be required.
Each committee will have its own charter. The charter for each committee will set forth the purposes and responsibilities of the committee as well as qualifications for committee membership, procedures for committee member appointment and removal, committee structure and operations and committee reporting to the Board.
The Chairperson of each committee, in consultation with committee members, will determine the frequency and length of the committee meetings consistent with any requirements set forth in the committee’s charter. The Chairperson of each committee, in consultation with committee members and management, will develop the committee’s agenda. The schedule for each committee will be furnished to all directors.
The Board and each committee have the authority to hire independent legal, financial, or other advisors as they may deem necessary, without consulting with or obtaining the approval of any officer of the Company in advance.
The Board, from time to time, may establish or maintain additional committees as necessary or appropriate.
Director Access to Officers, Employees and Independent Advisors
The Board at all times will have an Audit Committee and a Compensation Committee. All members of these committees will be independent directors under the criteria established by the Securities and Exchange Commission. Committee members will be appointed by the Board with consideration of the desires of individual directors. Consideration shall be given to rotating committee members periodically but will not be required.
Each committee will have its own charter. The charter for each committee will set forth the purposes and responsibilities of the committee as well as qualifications for committee membership, procedures for committee member appointment and removal, committee structure and operations and committee reporting to the Board.
The Chairperson of each committee, in consultation with committee members, will determine the frequency and length of the committee meetings consistent with any requirements set forth in the committee’s charter. The Chairperson of each committee, in consultation with committee members and management, will develop the committee’s agenda. The schedule for each committee will be furnished to all directors.
The Board and each committee have the authority to hire independent legal, financial, or other advisors as they may deem necessary, without consulting with or obtaining the approval of any officer of the Company in advance.
The Board, from time to time, may establish or maintain additional committees as necessary or appropriate.
Director Compensation
The form and amount of director compensation will be determined by the Compensation Committee in accordance with the policies and principles set forth in its charter, and the Compensation Committee will conduct an annual review of director compensation. The Compensation Committee will consider that directors’ independence may be jeopardized if director compensation and perquisites exceed customary levels, if the Company makes substantial charitable contributions to organizations with which a director is affiliated, or if the Company enters into consulting contracts with (or provides other indirect forms of compensation to) a director or an organization with which the director is affiliated.
Director Orientation and Continuing Education
At such time as a director joins the Board, the Board and the CEO will provide appropriate orientation for the director, including arrangement of meetings with management as determined to be appropriate and necessary. The Board considers it desirable that directors participate in continuing education opportunities and will reimburse directors for reasonable expenses as appropriate.
CEO Evaluation and Management Succession
The Compensation Committee will conduct an annual review of the CEO’s performance, as set forth in its charter. The Board of Directors will review the Compensation Committee’s report to ensure the CEO is providing the required leadership for the Company and meeting established expectations.
As appropriate, the entire Board will work to nominate and evaluate potential successors to the CEO. The CEO should at all times make available his or her recommendations and evaluations of potential successors, along with a review of any development plans recommended for such individuals.
Code of Business Conduct and Ethics
The Company shall maintain a Code of Business Conduct and Ethics. The rules set forth in the Code are applicable to all employees, officers, and directors. The Code addresses several areas, including compliance with law, conflicts of interest, confidentiality of information, protection and proper use of company assets and the reporting of any illegal or unethical behavior. Each director is expected to be familiar with and to follow the Company’s Code of Business Conduct and Ethics.
Annual Performance Evaluation
The Board of Directors will conduct an annual self-evaluation to determine whether it and its committees are functioning effectively. The results of the self-evaluation will be discussed with the full Board following the end of each fiscal year. The assessment will focus on the Board’s contribution to the Company and on areas in which the Board or management believes the Board could improve.
Disclosure of Guidelines
These Guidelines will be made available in accordance with applicable rules and regulations.
Adopted by Resolution of the Board of Directors
On November 8, 2021