(adopted 2/3/03; last amended 2/2/04)
There shall be a committee of the AMLI Residential Properties Trust Board of Trustees (the “Board”) which shall be called the Compensation Committee.
The Compensation Committee shall (1) make recommendations to the Board on compensation of the Company’s senior executives, including CEO, and officers, and (2) review and approve an annual report on executive compensation for inclusion in the Company’s proxy statement in accordance with applicable rules and regulations.
C. Committee Membership and Procedure.
The Compensation Committee shall consist of no fewer than three members. Each member of the Compensation Committee shall satisfy the independence requirements of the New York Stock Exchange and, if deemed appropriate from time to time by the Board or the Compensation Committee, meet the definition of “non-employee director” under Rule 16b-3 under the Securities Exchange Act of 1934, and “outside director” for purposes of Section 162(m) of the Internal Revenue Code of 1986. The Board shall appoint the members of the Compensation Committee annually, considering the recommendation of the Nominating & Governance Committee, and further considering the views of the Chairman of the Board and the Chief Executive Officer, as appropriate. The members of the Compensation Committee shall serve until their successors are appointed and qualify, and shall designate the Chairman of the Compensation Committee. The Board shall have the power at any time to change the membership of the Compensation Committee and to fill vacancies in it, subject to such new member(s) satisfying the above requirements. Except as expressly provided in this Charter or the by-laws of the Company or the Corporate Governance Guidelines of the Company, the Compensation Committee shall fix its own rules of procedure.
D. Committee Authority and Responsibilities.
• The Compensation Committee shall review and recommend to the Board corporate goals and objectives relevant to the Company’s four most senior executives’ compensation (including CEO), review the functions of the senior executives, evaluate their performance in light of those goals, objectives and functions, make recommendations to the Board as appropriate, and set the compensation level based on this evaluation.
• In determining the long-term incentive component of CEO compensation, the Compensation Committee should consider the Company’s performance and relative shareholder return, the value of similar incentive awards to CEOs at comparable companies, and the awards given to the Company’s CEO in past years.
• The Compensation Committee shall make recommendations to the Board with respect to incentive compensation plans and equity-based plans.
• The Compensation Committee shall adopt, administer, approve and ratify awards under incentive compensation and share plans, including amendments to the awards made under any such plans, and revise and monitor awards under such plans.
• The Compensation Committee shall review and approve compensation of other senior executives and officers.
• The Compensation Committee shall have the sole authority to retain and terminate any compensation consultant to be used to assist in the evaluation of trustee, CEO or senior executive compensation and shall have sole authority to approve the consultant’s fees and other retention terms. The Compensation Committee shall also have authority, subject to Board approval, to obtain advice and assistance from internal or external legal, accounting or other advisors.
• The Compensation Committee shall authorize management of the Company to annually prepare a report on executive compensation in accordance with applicable rules and regulations and shall review, revise and approve such report for inclusion in the Company’s proxy statement for its annual meeting of shareholders.
• The Compensation Committee shall make regular reports to the Board.
• The Compensation Committee shall review and reassess the adequacy of this Charter as appropriate and recommend any proposed changes to the Board for approval. The Compensation Committee shall annually review its own performance.
The Compensation Committee may form and delegate authority to subcommittees when appropriate.