INFOSPACE, INC.

CHARTER OF THE COMPENSATION COMMITTEE

OF THE BOARD OF DIRECTORS

Adopted March 15, 2004

PURPOSE:

The purpose of the Compensation Committee of the Board of Directors (the “Board”) of InfoSpace, Inc. (the “Company”) is to discharge the Board’s responsibilities relating to compensation of the Company’s executive officers.  In addition, the Compensation Committee shall review and make recommendations to the Board relating to compensation to be provided to directors.

The Compensation Committee is also responsible for producing an annual report on executive compensation for inclusion in the Company’s proxy statement.

The Compensation Committee has the authority to undertake the duties and responsibilities listed below and will have the authority to undertake such other duties as the Board from time to time prescribes.

STATEMENT OF PHILOSOPHY:

The policy of the Compensation Committee is to maximize stockholder value over time.  The primary goal of the Compensation Committee and its executive compensation program is therefore to align closely the interests of the executive officers with those of the Company’s stockholders.  To achieve this goal the Compensation Committee attempts (i) to offer compensation opportunities that attract and retain executives whose abilities are critical to the long-term success of the Company, motivate individuals to perform at their highest level and reward outstanding achievement, (ii) to maintain a significant portion of the executive’s total compensation at risk, tied to achievement of specified financial, organizational or management performance goals approved by the Board, and (iii) to encourage executives to manage from the perspective of owners with an equity stake in the Company.

MEMBERSHIP:

The Compensation Committee will be appointed by, and will serve at the discretion of, the Board.  The Compensation Committee shall consist of no fewer than two members.  The members of the Compensation Committee must meet the following criteria:

  • When applicable, the independence requirements of Nasdaq Rule 4200, as amended;
  • The “non-employee director” definition of Rule 16b-3 promulgated under Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and
  • The “outside director” definition of Section 162(m) of the Internal Revenue Code of 1986, as amended.



RESPONSIBILITIES:

The responsibilities of the Compensation Committee shall include the following:

  • The Compensation Committee shall annually review and approve for the CEO and the other executive officers of the Company (a) the annual base salary, (b) the incentive bonus, including the goals and amount, (c) equity compensation, (d) employment agreements, severance arrangements, and change in control agreements/provisions, and (e) any other benefits, compensation, or arrangements that are not available generally to employees.  In reviewing and approving such matters, the Compensation Committee shall consider such matters as it deems appropriate, including the Company’s financial and operating performance, the alignment of the interests of the executive officers and the Company’s stockholders, the performance of the Company’s common stock and the Company’s ability to attract and retain qualified individuals.
  • The Compensation Committee shall annually review and make recommendations to the Board regarding the compensation policy for such other officers of the Company as directed by the Board.
  • The Compensation Committee shall annually review and make recommendations to Company management regarding general compensation goals and guidelines for the Company’s employees and the criteria by which bonuses to the Company’s employees are determined.
  • The Compensation Committee shall annually evaluate the performance of the CEO and such other executive officers as deemed appropriate and shall review the evaluation with the Board in executive session.
  • The Compensation Committee shall prepare a report (to be included in the Company’s proxy statement) that describes: (a) the criteria on which compensation paid to the CEO for the last completed fiscal year is based, (b) the relationship of such compensation to the Company’s performance, and (c) the Compensation Committee’s compensation policies applicable to executive officers.
  • The Compensation Committee shall act as Administrator (as defined therein) of the Restated 1996 Flexible Stock Incentive Plan, the 1998 Employee Stock Purchase Plan, the 2001 Nonstatutory Stock Option Plan, other stock option plans assumed in connection with acquisitions, and any subsequent employee benefit plans adopted and approved by the Company’s Board and stockholders, if appropriate.  In its administration of the plans, the Compensation Committee may, pursuant to authority delegated by the Board, (i) grant stock options or stock purchase rights to individuals eligible for such grants (including grants to individuals subject to Section 16 of the Exchange Act in compliance with Rule 16b-3 promulgated thereunder, as long as the Compensation Committee is comprised entirely of “non-employee directors,” as such term is defined in Rule 16b-3(b)(3)(i) promulgated under the Exchange Act), and (ii) amend such stock options or stock purchase rights.  The Compensation Committee shall also make recommendations to the Board with respect to amendments to the plans and changes in the number of shares reserved for issuance thereunder.
  • The Compensation Committee may review and make recommendations to the Board regarding other plans that are proposed for adoption or adopted by the Company for the provision of compensation to employees of, directors of and consultants to the Company.
  • The Compensation Committee may authorize the repurchase of shares from terminated employees pursuant to applicable law.
  • The Compensation Committee may form and delegate authority to subcommittees when appropriate.
  • The Compensation Committee shall review and assess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval.
  • The Compensation Committee shall have the sole authority to retain and terminate any compensation consultant to be used by the Company to assist in the evaluation of CEO or other executive officer compensation and shall have sole authority to approve the consultant’s fees and other retention terms.  The Compensation Committee shall also have authority to obtain advice and assistance from internal or external legal, accounting or other advisors.
  • The Compensation Committee shall review any issues concerning the legal compliance and maintenance of the Company’s employee benefit plans.

MEETINGS:

The Compensation Committee shall meet as often as may be deemed necessary or appropriate, but no fewer than four times each year.

MINUTES:

The Compensation Committee will maintain written minutes of its meetings, which minutes will be filed with the minutes of the meetings of the Board.

REPORTS:

The Compensation Committee will make regular reports to the Board of its activities and proceedings.  As appropriate, such reports shall be made to the Board in executive session.

COMPENSATION:

Members of the Compensation Committee shall receive fees for their service as Compensation Committee members as may be determined by the Board in its sole discretion. 

Members of the Compensation Committee may not receive any compensation from the Company except the fees that they receive for service as members of the Board or any committee thereof.