Compensation Committee Charter

 

         I.            PURPOSE
This Charter specifies the scope of the responsibilities of the Compensation Committee (the "Committee") of the Board of Directors (the "Board") of InPhonic, Inc. (the "Company"). The primary purpose of the Committee is to discharge the Board's responsibilities relating to compensation and benefits of the Company's executive officers and directors. In carrying out these responsibilities, the Committee shall review all components of executive officer and director compensation for consistency with the Committee's compensation philosophy as in effect from time to time.

The goals of the Company's executive officer compensation policies are to attract, retain and reward executive officers who contribute to the Company's success, to align executive officer compensation with the Company's performance and to motivate executive officers to achieve the Company's business objectives. The Committee believes that executive compensation should be related to corporate performance and stockholder value. The Company uses salary, bonus compensation and equity- or incentive-based compensation to attain these goals.

        II.            ORGANIZATION AND MEMBERSHIP REQUIREMENTS
The Committee shall be comprised of at least three directors, each of whom shall satisfy the independence requirements of Nasdaq, provided that one director who does not meet the independence criteria of Nasdaq may, subject to approval of the Board, serve on the Committee pursuant to, and subject to the limitations under, the "exceptional and limited circumstances" exception as provided under Nasdaq rules. A director shall not serve as a member of the Committee if the Chief Executive Officer or another executive officer of the Company serves on the compensation committee of another company that employs that director as an executive officer.

The members shall be appointed by the Board on the recommendation of the Nominating and Corporate Governance Committee and shall serve until their successors are duly elected and qualified or their earlier resignation or removal. Any member of the Committee may be replaced by the Board on the recommendation of the Nominating and Corporate Governance Committee. Unless a chairman is elected by the Board, the members of the Committee may designate a chairman by the majority vote of the full Committee membership. The Committee may from time to time delegate duties or responsibilities to subcommittees or to one member of the Committee.

A majority of the members shall represent a quorum of the Committee, and, if a quorum is present, any action approved by at least a majority of the members present shall represent the valid action of the Committee. Any actions taken by the Committee during any period in which one or more members fail for any reason to meet the membership requirements set forth above shall be nonetheless duly authorized actions of the Committee for all corporate purposes.

      III.            MEETINGS
The Committee shall have the authority to obtain advice or assistance from consultants, legal counsel, accounting or other advisors as appropriate, to perform its duties hereunder and to determine the terms, costs and fees for such engagements. Without limitation, the Committee shall have the sole authority to retain or terminate any consulting firm used to evaluate director, CEO or executive compensation, and to determine and approve the terms of engagement the fees and costs for such engagements. The fees and costs of any consultant or advisor engaged by the Committee to assist in it in performing any duties hereunder shall be borne by the Company.

The Committee shall meet as often as it deems appropriate, but not less frequently than twice each year to review the compensation of the executive officers and directors of the Company, and otherwise perform its duties under this charter. The Committee shall, when necessary, meet in executive session outside of the presence of any senior executive officer of the Company. The Committee shall maintain written minutes of its meetings, and the chair of the Committee shall report on activities of the Committee to the full Board of Directors.

     IV.            COMMITTEE AUTHORITY AND RESPONSIBILITIES
The Committee shall:

                               1.            Determine all compensation and perquisites for the Chief Executive Officer, including incentive-based and equity-based compensation. The Chief Executive Officer may not be present during such voting or deliberations. In determining the amount, form and terms of such compensation, the Committee shall consider the annual performance evaluation of the CEO conducted by the Board of Directors in light of the performance objectives and goals, including corporate goals and objectives, relevant to the compensation of the Chief Executive Officer, as well as competitive market data pertaining to CEO compensation at comparable companies, and such other factors as the Committee shall deem relevant.

                               2.            Determine all compensation and perquisites for all other executive officers of the Company. In determining the amount, form and terms of such compensation, the Committee shall consider the performance of such executive officer in light of the performance objectives and goals, including corporate goals and objectives, relevant to the compensation of the officer, as well as competitive market data pertaining to executive officer compensation at comparable companies, and such other factors as the Committee shall deem relevant. The CEO may be present at meetings at which executive officer compensation, other than the compensation of the CEO, is considered, and may make recommendations to the Committee on compensation for all other executive officers.

                               3.            Review and approve and administer all incentive-based or equity-based compensation plans, incentive and equity awards, including grants of stock options or restricted stock to all eligible employees under the plans, and the amendment of such grants. Administration of incentive-based or equity-based compensation plans, except as applicable to executive officers or directors of the Company, may be further delegated to a subcommittee, which need not be a subcommittee of the Committee and may include a subcommittee consisting of management, or to a single executive officer.

                               4.            Approve all executive officer employment, severance, or change-in-control agreements, including all special or supplemental benefits, and all agreements to indemnify executive officers or directors of the Company.

                               5.            Review and propose to the Board from time to time changes in director compensation.

                               6.            Review and make recommendations to the Board concerning general compensation goals and guidelines applicable to employees, including the criteria by which bonuses to employees may be determined.

                               7.            Prepare an annual report on executive compensation for inclusion in the Company's proxy statement for the annual meeting of stockholders, in accordance with applicable rules and regulations.

                               8.            Perform such other activities consistent with this Charter, the Company's Bylaws and governing law, as the Committee or the Board deems necessary or appropriate in connection with the Committee's duties hereunder.

                               9.            Review and reassess the adequacy of this Charter as appropriate and recommend any proposed changes to the Board for approval.

                            10.            Review and evaluate the Committee's own performance on an annual basis.