The Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of SFBC International, Inc. is appointed by the Board (i) to discharge the Board’s responsibilities relating to compensation of the Company’s directors and officers, (ii) to have overall responsibility for approving and evaluating the director and officer compensation plans, policies and programs of the Company, and (iii) to have responsibility for producing an annual report on executive compensation for inclusion in the Company’s proxy statement.
There shall be not less than three members of the Committee, one of whom shall be elected by the Board to serve as Chairman of the Committee (the “Committee Chairman”), and each of whom shall meet the independence and experience requirements of the Nasdaq Stock Market, Inc. (“Nasdaq”). Thus, the members of the Committee shall meet the following criteria:
b. In addition, at least two members of the committee must qualify as “non-employee directors,” as defined in Rule 16b-3 under the Securities Exchange Act of 1934, and as “outside directors,” as defined in Section 162(m) of the Internal Revenue Code and Treasury regulations thereunder.
a. Appointment. The Board shall appoint members of the Committee.
b. Professional Advisors. The Committee shall
have the authority, and is hereby authorized to incur costs, to retain special
legal, accounting, compensation or other consultants to advise the Committee
and/or to assist in the evaluation of director, chief executive officer and
other senior executives or senior executive compensation and shall have sole
authority to approve the consultant’s fees and other retention terms. The
Committee may request any
officer or employee of the Company or the Company’s outside counsel or independent compensation consultant to attend a meeting of the Committee or to meet with any members of, or consultants to, the Committee.
c. General Duties. The Committee shall
annually review and approve corporate goals and objectives relevant to chief
executive officer and other senior executives compensation, evaluate the chief
executive officer and other senior executives’ performance in light of those
goals and objectives, and approve the chief executive officer’s and other
executives officers’ compensation levels based on this evaluation. Executive officers refers to all officers who are required to file
reports under Section 16 of the Securities Exchange Act of 1934. In determining
the long-term incentive component of the chief executive officer and other
executive officers’ compensation, the Committee will consider the Company’s
performance and relative stockholder return, the value of similar incentive
awards to other executives at comparable companies, and the awards given to the
chief executive officer and other executive officers in past years.
(1) The Committee shall annually review and have the authority to set the compensation of all directors, the chief executive officer and all other executive officers, including incentive compensation plans and equity-based plans. The Committee shall approve all grants of options under the Company’s option plans except as provided therein. If the Committee does not consist entirely of directors who qualify as “non-employee directors” under Rule 16b-3 and as “outside directors” under Section 162(m) of the Internal Revenue Code, all awards of performance-based compensation and all grants under the Company’s option plans shall be made by a subcommittee of at least two directors who meet such qualifications. The vote of at lease two directors who meet such qualifications shall be deemed the vote of a subcommittee of such directors.
(2) The Committee shall annually review and approve, in each case and when and if appropriate, for the president, chief executive officer and other executive officers, (i) the annual base salary level, (ii) annual incentives, (iii) the long-term incentives, (iv) employment agreements, severance arrangements, and change in control agreements/ provisions, and (v) any special or supplemental benefits.
(3) The Committee shall meet in executive session to determine the compensation of the president and chief executive officer.
(4) The Committee may form and delegate authority to subcommittees when appropriate.
(5) The Committee shall make regular reports to the Board and shall cause an annual report of the Committee to be included in the Company’s annual report to its stockholders.
(6) The Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for their consideration and approval. The Committee shall annually review its own performance.
The Committee will hold meetings at such times and at such places as it shall deem necessary.
As revised by the Committee April 28, 2004.
/s/ Dr. Leonard I. Weinstein
Dr. Leonard I. Weinstein, Chairman of Committee