ValueVision Media is committed to the highest levels of ethical conduct and corporate governance, standards which are consistent with our corporate culture. Here we share the guidelines and charters that help our Corporate Officers and Board of Directors fulfill their responsibility to our shareholders.

 

 

 Management   Directors   Governance   Committees   Section 16 filings    

   

Outline

  Corporate Governance Guidelines

  Governance and Nominating Committee Charter

  Code of Ethics for Chief Executive and Senior Financial Officers

  Audit Committee Charter

  Compensation Committee Charter

 

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Corporate Governance Guidelines

Corporate Governance Guidelines

 

 

The business of ValueVision Media, Inc. ("ValueVision" or the "Company") is managed under the direction of the Company's Board of Directors (the "Board"). The Board delegates the day-to-day conduct of ValueVision's business to the Company's senior management team. The following Corporate Governance Guidelines have been adopted by the Board to provide a framework within which directors and management can effectively pursue ValueVision's objectives for the benefit of its shareholders.

 

These Guidelines were first adopted on April 22, 2004, and are intended to be updated as new developments in corporate governance applicable to the Company arise from time to time. These Guidelines are in addition to, and are not intended to change, interpret or supersede, any applicable federal or state law or regulation, including the Minnesota Business Corporation Act, the applicable rules of the Securities and Exchange Commission (the "SEC") and The Nasdaq Stock Market, Inc. ("Nasdaq"), or ValueVision's Amended and Restated Articles of Incorporation and Bylaws.

 

Role of the Board of Directors

 

· Effective Governance. The Board believes that its primary responsibility is to provide effective governance over ValueVision's business and affairs for the benefit of its shareholders. The Board is the ultimate decisionmaking body of ValueVision, except with respect to those matters reserved to the shareholders. The Board selects the Chairman of the Board and the Chief Executive Officer, approves the selection of certain other members of the senior management team proposed by the Chief Executive Officer, acts as an advisor and counselor to the Chief Executive Officer and senior management, and monitors their performance.

 

· Management Succession. The Board plans for succession to the positions of Chairman of the Board and Chief Executive Officer. The Governance and Nominating Committee (the "Governance Committee") shall regularly prepare or update a Chief Executive Officer succession plan, which in turn shall be reviewed and approved by the Board.

 

· Evaluation of the Chief Executive Officer. The Governance Committee shall annually evaluate the performance of the Chief Executive Officer, following a process approved by that Committee. As part of this evaluation, the Governance Committee will consult with the other members of the Board regarding the Chief Executive Officer's performance. Results of this evaluation shall be communicated to the Chief Executive Officer by the chair of the Governance Committee.

 

Composition of the Board of Directors.

 

· Size of the Board. The total number of directors will be determined from time to time by the Board. The Governance Committee, in consultation with the Chairman and Chief Executive Officer, will make recommendations to the Board concerning the appropriate size and needs of the Board. While the number of directors should not exceed a number that can function efficiently as a body, the Board believes that the quality of the individuals serving and the overall balance of the Board is more important than the precise number of members.

 

· Independence of the Board. The Board will consist of a majority of non-employee directors who meet the criteria required for independence by law and the rules and regulations of the SEC and Nasdaq. The Governance Committee shall annually review the independence of each non-employee director for compliance with applicable requirements. The Board believes that the Chief Executive Officer should always be a member of the Board. Except in unusual circumstances, however, such as during a transition in leadership, the Board would not expect to have more than one other member of senior management serve as a director.

 

· Director Qualification Standards. Directors should possess high personal and professional ethics, integrity and values, and be committed to representing the long-term interests of ValueVision's stakeholders. Directors should also have an inquisitive and objective perspective, practical wisdom and mature judgment, and be willing and able to challenge management in a constructive manner. ValueVision endeavors to have its Board members represent diverse skills and experience at senior policymaking levels in businesses or other endeavors relevant to ValueVision's activities, including the areas of finance; mergers & acquisitions; corporate law; consumer merchandising and retail; TV home shopping; TV programming and media; retail operations and fulfillment; direct response marketing; and e-commerce and technology.

 

· Time Commitment of Directors. Directors must be willing to devote sufficient time to carrying out their duties and responsibilities effectively, and should be committed to serving on the Board for an extended period of time. The number of Boards of publicly traded companies or Audit Committees thereof on which outside directors sit should not exceed three (in addition to the Company) without the concurrence of the Governance Committee and may not, in any event, constitute a conflict of interest.

 

· Selection of Directors. The Governance Committee is responsible for establishing and implementing procedures to identify and review the qualifications of all nominees for Board membership. The Committee will consider nominations of director candidates made by current and former directors, an independent search firm, if one is engaged, senior management, and ValueVision's shareholders. The Committee intends to apply the same criteria for consideration of shareholder nominees as it does to nominees proposed by other sources, subject to the Company's obligations under its Amended and Restated Articles of Incorporation granting certain shareholders the right to nominate certain directors. The procedure will include making a preliminary assessment of each proposed nominee, based upon the individual's resume and biographical information, an indication of the individual's willingness to serve and ability to devote sufficient time to the duties of Board and Committee membership, and other background information, to the extent available and deemed relevant by the Committee. All candidates who continue in the process will then be interviewed by members of the Committee. The Committee will then make recommendations to the Board for inclusion in the slate of directors at an annual or special meeting of shareholders, or for appointment by the Board to fill a vacancy.

 

The Governance Committee will apply its director candidate selection criteria, including a director's past contributions to the Board, prior to recommending a director for reelection to another term. Directors should not expect to be renominated annually as a matter of course, subject to the Company's obligations under its Amended and Restated Articles of Incorporation granting certain shareholders the right to nominate certain directors. The Board and director evaluation process established by that Committee will be an important determinant for Board tenure.

 

· Director Retirement and Resignation Policy. Unless otherwise approved by a majority of the directors, no individual may be nominated to serve as a director if the term of service would expire more than one year after such individual's 70th birthday. Non-employee directors are expected to offer their resignations whenever their principal employment or affiliation changes after joining the Board, and the Governance Committee will then decide whether the director should continue to serve.

 

· Term Limits. The Board does not believe it appropriate or necessary to limit the number of terms a director may serve. It is the responsibility of the Governance Committee to determine the continued effectiveness of each director when that director is being considered for renomination.

 

· Board Leadership. The Chairman of the Board and the Chief Executive Officer are currently separate offices, with a non-executive Chairman of the Board. The Board retains the right to exercise its discretion in combining or separating the offices of Chairman of the Board and Chief Executive Officer in the future. This determination will be made depending upon what the Board believes is best for ValueVision and its shareholders in light of all circumstances at any particular time.

 

· Director Compensation. Director compensation will reflect ValueVision's intention to attract and retain outstanding people to serve on the Board. Annual retainers, meeting and committee fees, stock options and other forms of compensation, as appropriate, will be used in the furtherance of this objective. The Compensation Committee will review director compensation on an annual basis, and may retain independent consultants to advise on this subject from time to time.

 

Functioning of the Board of Directors

 

· Board Meetings. Board meetings typically are scheduled in advance and normally will be held six times annually, or more frequently as circumstances dictate. It is the responsibility of the directors to attend meetings of the Board, and to attend annual meetings of shareholders, in each case subject to the occasional scheduling conflict. Where attendance at meetings in person is not possible, directors should seek to attend telephonically where feasible.

 

· Executive Sessions. During each regular Board meeting, the independent directors meet in executive session without the Chief Executive Officer or any other member of management being present. The Chair of the Governance Committee will preside at such meetings if the Chief Executive Officer is serving as Chairman of the Board.

 

· Board Committees. The Board is organized so that a significant portion of its business is conducted by its committees. The present committee structure consists of Audit, Compensation, and Governance Committees. The Board may add new committees or remove existing committees as it deems advisable in the fulfillment of its primary responsibilities. In general, committees of the Board are utilized to focus on issues that may require more in-depth scrutiny. All committees report to the Board, and all significant findings of a committee are presented to the Board for discussion and review.

 

· Committee Charters. The Board approves a charter for each committee. The duties of each committee are annually reviewed by each committee and by the Governance Committee, and any recommended changes are presented to the Board for consideration. Committees are empowered to act on behalf of the Board in those areas which the Board has delegated to them.

 

· Committee Composition. Committees of the Board are comprised solely of non-employee directors who meet the independence requirements of the SEC and Nasdaq. The Governance Committee, in consultation with the Chairman of the Board and the Chief Executive Officer, recommends to the Board appointment of committee members and committee chairs, who will normally serve a period of three to five years. Consideration is given to periodic rotation of committee membership and leadership by taking into account continuity, expertise and tenure.

 

· Director Orientation and Continuing Education. New directors are provided with background briefings by the Chief Executive Officer, Chief Financial Officer and other members of senior management, and a visit to ValueVision's facilities, in conjunction with one of the scheduled Board meetings. The Governance Committee shall have responsibility for overseeing that new directors receive sufficient orientation. Annually, ValueVision will make available to directors third-party, independently certified director training, pursuant to Nasdaq guidelines.

 

· Annual Performance Evaluation of the Board. The Governance Committee is responsible for developing evaluation tools and procedures to assess the performance of the Board and each of its committees. That Committee conducts an annual assessment of the Board's performance to determine whether it and its committees are functioning effectively, and annually reports the results of such evaluations to the Board and relevant committees.

 

· Code of Conduct. All directors are required to abide by the Company's Business Ethics Policy.

 

· Conflicts of Interest. Directors shall promptly disclose to the Board any situation which could reasonably be considered as a conflict of interest with their service as a director, or having the appearance of such. Both the existence of the interest and the nature thereof (e.g., financial, family relationship, professional, charitable or business affiliation) should be disclosed. Communication

 

· Board Access to Management. Board members have complete access to ValueVision's senior management and to management information. Management shall be responsive to requests for information from directors. The Board encourages the Chief Executive Officer, as appropriate, to bring members of management to Board meetings who can provide additional insight into the items being discussed.

 

· Board Access to Independent Advisors. The Board and any Board committee has the right to retain outside counsel and other outside advisors of its choice with respect to any issues relating to its activities.

 

· Board Communications with Stakeholders. The Board encourages open communication with stakeholders of ValueVision, including shareholders, customers, employees, communities, suppliers, governments, and corporate partners. The Chief Executive Officer is responsible for establishing effective communication policies with stakeholders.

 

· Shareholder Communications with Directors. Subject to reasonable constraints of time and topics and rules of order, shareholders may direct comments to or ask questions of the Chairman of the Board and the Chief Executive Officer during the Annual Meeting of Shareholders. In addition, shareholders may communicate directly with any director by writing to:

 

ValueVision Director(s)

ValueVision Media, Inc.

6740 Shady Oak Road

Eden Prairie, Minnesota 55344

Attention: Corporate Secretary

 

The Corporate Secretary will review all such communications for relevance to Board activities and will promptly forward all relevant written communications to the Board or the individually named directors.

 

· Shareholder Nominations. Shareholders may nominate director candidates for consideration by the Governance Committee by writing to the Company's Corporate Secretary, at the address listed above, and providing, among other things, the candidate's name, biographical data and qualifications, and a signed certification of the number of shares of ValueVision common stock held by the shareholder. This policy shall be disclosed in ValueVision's annual proxy statement.

 

 

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Governance and Nominating Committee Charter

Governance and Nominating Committee Charter

 

 

Purpose of Committee

 

The purpose of the Governance and Nominating Committee (the "Committee") of the Board of Directors (the "Board") of ValueVision Media, Inc., a Minnesota corporation (the "Company") is to:

 

· identify and recommend individuals to the Board for nomination as members of the Board, its Committees, and as chairperson of the Board and of each of the committees,

 

· establish procedures for the evaluation of the performance of the Board and the Chief Executive Officer,

 

· review and recommend Board compensation, and

 

· to develop and recommend to the Board a set of corporate governance principles applicable to the Company, and to periodically review and recommend modifications in such principles, as appropriate.

 

Committee Membership

 

The Committee shall consist of two or more members of the Board, each of whom the Board has determined has no material relationship with the Company and each of whom is otherwise "independent" under the rules of the Securities and Exchange Commission ("SEC") and The Nasdaq Stock Market, Inc. ("Nasdaq").

 

The members of the Committee shall be appointed by the Board. Candidates to fill subsequent vacancies in the Committee shall be nominated by the Committee as set forth below and appointed by the Board. Members shall serve at the pleasure of the Board and for such term or terms as the Board may determine.

 

Meetings

 

The Committee shall meet as often as its members deem necessary to perform the Committee's responsibilities and shall report to the Board on a regular basis and not less than once a year.

 

Committee Structure and Operations

 

The Board shall designate one member of the Committee as its chairman. The Committee shall meet in person or telephonically at least once a year at a time and place determined by the Committee chair, with further meetings to occur or actions to be taken by unanimous written consent when deemed necessary or desirable by the Committee or its chair.

 

Committee Duties and Responsibilities

 

The following are the duties and responsibilities of the Committee:

 

· To make recommendations to the Board from time to time as to changes that the Committee believes to be desirable to the size of the Board or any Committee thereof.

 

· To identify individuals believed to be qualified to become Board members, and to recommend to the Board the nominees to stand for election as directors at the annual meeting of stockholders or, if applicable, at a special meeting of stockholders. In the case of a vacancy in the office of a director (including a vacancy created by an increase in the size of the Board), the Committee shall recommend to the Board an individual to fill such vacancy either through appointment by the Board or through election by stockholders. In nominating candidates, the Committee shall take into consideration such factors as it deems appropriate, subject to the Company's obligations under its Amended and Restated Articles of Incorporation granting certain shareholders the right to nominate directors. These factors may include judgment, skill, experience with businesses and other organizations in industries related to the business of the Company (such as finance; mergers & acquisitions; corporate law; consumer merchandising and retail; TV home shopping; TV programming and media; retail operations and fulfillment; direct response marketing; and e-commerce and technology), experience as an executive with a publicly traded company, the interplay of the candidate's experience with the experience of other Board members, and the extent to which the candidate would be a desirable addition to the Board and any committees of the Board.

 

· The Committee will consider nominations of director candidates made by current and former directors, an independent search firm, if one is engaged, members of senior management, ValueVision's shareholders, and from other appropriate sources.

 

· To develop and recommend to the Board standards to be applied in making determinations as to the absence of material relationships between the Company and a director, and as to the "independence" of directors and director-candidates pursuant to the requirements of the SEC and Nasdaq.

 

· To identify Board members qualified to fill vacancies on any committee of the Board including the Committee and to recommend that the Board appoint the identified member or members to the respective committee. In nominating a candidate for committee membership, the Committee shall take into consideration the factors set forth in the charter of the committee, if any, as well as any other factors it deems appropriate, including without limitation the consistency of the candidate's experience with the goals of the committee and the interplay of the candidate's experience with the experience of other committee members.

 

· Establish procedures for the Committee to exercise oversight of the evaluation of the Board and the Chief Executive Officer.

 

· Review annually the Company's corporate governance principles, and recommend changes to the principles as appropriate.

 

· Prepare and issue the evaluation required under "Performance Evaluation" below and other evaluations provided under the Company's corporate governance principles or requested by the Board.

 

· At least annually review the compensation paid to non-management Directors and make recommendations to the full Board for its consideration on such matters.

 

· Any other duties or responsibilities expressly delegated to the Committee by the Board from time to time relating to the nomination of the Board and committee members.

 

Performance Evaluations

 

The Committee shall produce and provide to the Board an annual performance evaluation of the Committee, which evaluation shall compare the performance of the Committee with the requirements of this charter and set forth the goals and objectives of the Committee for the upcoming year. The Committee shall conduct an annual performance evaluation of the Chief Executive Officer, pursuant to the evaluation process established by the Committee and reflecting the input from the other members of the Board.

 

The Committee shall also conduct an annual assessment of the Board's performance (including the committees of the Board) to determine whether the Board and its committees are functioning effectively.

 

Delegation to Subcommittee

 

The Committee may, in its discretion, delegate all or a portion of its duties and responsibilities to a subcommittee of the Committee.

 

Resources and Authority of the Committee

 

The Committee shall have the resources and authority appropriate to discharge its duties and responsibilities, including the authority to select, retain, terminate and approve the fees and other retention terms of special counsel and other experts or consultants as it deems appropriate, without seeking approval of the Board or management. With respect to consultants or search firms used to identify director candidates, this authority shall be vested solely in the Committee.

 

Committee Reports

 

The Committee shall issue the following reports to the Board:

 

· An annual performance evaluation of the Committee, which evaluation must compare the performance of the Committee with the requirements of this charter and set forth the goals and objectives of the Committee for the upcoming year. The performance evaluation should also recommend to the Board any improvements to this charter deemed necessary or desirable by the Committee.

 

· An annual performance evaluation of the Board and the other committees of the Board.

 

· An annual performance evaluation of the CEO.

 

· Other evaluations and reports as provided under the Company's corporate governance principles or requested by the Board.

 

Committee Procedures

 

· The performance evaluations shall be conducted in such manner as the Committee deems appropriate. The reports to the Board may take the form of an oral report by the chair of the Committee or any other member of the Committee designated by the Committee to make this report.

 

· A secretary shall be appointed at each meeting of the Committee, and minutes of each meeting shall be prepared and filed with the Corporate Secretary. A summary of the actions taken at each Committee meeting shall be presented to the Board at the next Board meeting.

 

 

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Code of Ethics for Chief Executive and Senior Financial Officers

Code of Ethics for Chief Executive and Senior Financial Officers

 

 

The attitude and actions of the Chief Executive Officer (the "CEO"), Chief Financial Officer (the "CFO") and Chief Accounting Officer (the "CAO") of ValueVision Media, Inc. (the "Company") are essential for maintaining the Company's commitment to (i) honest and ethical conduct in the fulfillment of their duties for the Company, (ii) full, fair, accurate, timely and understandable disclosure of material financial, accounting, and other information in the Company's public reports and communications, and (iii) compliance with applicable governmental laws, rules and regulations. Accordingly, the Company's Board of Directors has developed and adopted this Code of Ethics applicable to its CEO, CFO and CAO with the goal of promoting the appropriate standards of legal and ethical conduct within the Company.

 

Honest and Ethical Conduct

 

While the Company expects honest and ethical conduct in all aspects of the Company's business from all employees, the Company expects that the CEO, CFO and CAO will set high standards of ethical conduct and integrity. These officers must set an example for the Company's employees and the Company expects these officers to foster a culture of transparency, integrity and honesty.

 

Conflicts of Interest

 

Service to the Company should never be subordinated to personal gain and advantage. If any of the CEO, CFO or CAO becomes aware that he or she is in a situation that presents an actual or apparent conflict of interest (i.e., any situation where that individual's private interest or personal gain interferes or appears to interfere with the interests of the Company), or is concerned that an actual or apparent conflict of interest might develop, he or she is required to discuss the matter with the Chairman of the Audit Committee for the purpose of developing a means for the ethical handling of that situation.

 

Disclosure

 

The CEO, CFO and CAO, among others, have a supervisory role with respect to the preparation of the Company's reports and documents filed with or submitted to the Securities and Exchange Commission (the "SEC") and the Company's other public communications and are responsible for taking all steps reasonably necessary to cause the disclosure in these reports, documents and other communications to be full, fair, accurate, timely and understandable. Adequate supervision includes closely reviewing and critically analyzing the financial information to be disclosed, ensuring that proper accounting controls have been applied, that transactions are properly authorized and recorded, and that relevant records have been properly retained. Full, fair and accurate disclosure includes the full reporting of facts, professional judgments and opinions, whether favorable or unfavorable.

 

Each of the CEO, CFO and CAO shall promptly bring to the attention of the Audit Committee any information he or she may have concerning (i) material deficiencies in the design or operation of internal controls which could adversely affect the Company's ability to record, process, summarize and report financial data, or (ii) any fraud, whether or not material, or any actual or apparent conflicts of interest between personal and professional relationships, involving any management or other employees who have a significant role in the Company's financial reporting, disclosure or internal controls.

 

In the performance of their duties, the CEO, CFO and CAO are prohibited from knowingly misrepresenting facts. The CEO, CFO or CAO will be considered to have knowingly misrepresented facts if he or she knowingly (i) makes, or permits or directs another to make, materially false or misleading entries in financial statements or records; (ii) fails to correct materially false and misleading financial statements or records; (iii) signs, or permits another to sign, a document containing materially false and misleading information; or (iv) falsely responds, or fails to respond, to specific inquires of the Company's external auditors.

 

The CEO, CFO and CAO are prohibited from directly or indirectly taking any action to interfere with, fraudulently influence, coerce, manipulate or mislead the Company's independent public auditors in the course of any audit of the Company's financial statements or accounting books and records.

 

Compliance with Law

 

It is the Company's policy to comply with all applicable laws, rules and regulations. It is the responsibility of the CEO, CFO and CAO to adhere to the standards and restrictions imposed by those laws, rules and regulations, and in particular, those relating to accounting and auditing matters. Each of the CEO, CFO and the CAO shall promptly bring to the attention of the General Counsel and to the Audit Committee any information he or she may have concerning evidence of a material violation of securities or other laws, rules or regulations applicable to the Company and the operation of its business, by the Company or any agent thereof, or of a violation of the Company's Business Ethics Policy or this Code of Ethics for Chief Executive and Senior Financial Officers.

 

Accountability

 

The Board of Directors shall determine, or designate appropriate persons to determine, appropriate actions to be taken in the event of violations of this Code of Ethics by the CEO, CFO or CAO with the goal of deterring wrongdoing and promoting accountability for adherence to this Code of Ethics. Actions may include written notice, censure, demotion or re-assignment, suspension with or without pay or benefits and termination of employment.

 

Violations of this Code of Ethics may also constitute violations of law and may result in civil and criminal penalties for the violator, the violator's supervisors and the Company.

 

COMPLIANCE CERTIFICATE

 

I have read and understand the ValueVision Media, Inc. Code of Ethics for Chief Executive and Senior Financial Officers (the "Code"). I will adhere in all respects to the ethical standards described in the Code. I further confirm my understanding that any violation of the Code will subject me to appropriate disciplinary action, which may include demotion or discharge.

 

I certify to ValueVision Media, Inc. that I am not in violation of the Code, unless I have noted such violation in a signed Statement of Exceptions attached to this Compliance Certificate.

 

Date:_______

 

Name:____________

 

Title/Position:_____________

 

Check one of the following:

 

[ ] A Statement of Exceptions is attached.

 

[ ] No Statement of Exceptions is attached.

 

 

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Audit Committee Charter

VALUEVISION MEDIA, INC.

 

Audit Committee Charter

 

Purpose

 

There will be an Audit Committee (the “Committee”) of the Board of Directors (the “Board”) of ValueVision Media, Inc., a Minnesota corporation (the “Company”).

 

The Committee will have the responsibility and authority to oversee the Company’s management and independent auditors in regard to corporate accounting and financial reporting, to select, evaluate and, where appropriate, replace the independent auditors, and to nominate the independent auditors to be proposed for approval by the shareholders in any proxy statement. The Committee also has oversight of the Company’s compliance with legal and regulatory requirements, the independent auditor’s qualifications and independence and the performance of the Company’s internal audit function and independent auditor. The Committee has the authority to conduct any investigation it deems appropriate, with full access to all books and records, facilities, personnel and outside advisors of the Company. The Committee will prepare an audit committee report as required by the rules of the SEC to be included in the Company’s annual proxy statement.

 

The Committee is empowered to retain its own outside legal counsel, auditors or other experts in its discretion to advise the Committee and to compensate such parties with the Company’s funds. The Company will provide appropriate funding, as determined by the Committee, for payment of compensation to any such advisors employed by the Committee.

 

The Committee will meet as often as it determines, but not less frequently than quarterly. The Committee will meet periodically with management, the internal auditors and the independent auditor in separate executive sessions. The Committee may request any officer or employee of the Company or the Company’s outside counsel or independent auditor to attend a meeting of the Committee or to meet with any members of, or consultants to, the Committee. The Committee will report regularly to the Board through presentations at Board meetings or by submission of the minutes of the Committee meetings to the Board. In addition to funding for the specific purposes described above, the Company will provide appropriate funding, as determined by the Committee, for ordinary administrative expenses that are necessary for the Committee to carry out its duties.

 

Organization

 

The Committee will consist of at least three directors. Each director appointed to the Committee will:

 

a) not be disqualified from being an “independent director” within the meaning of Rule 4200 of the NASD Manual, and will have no relationship with the Company which, in the opinion of the Board, would interfere with the exercise of independent judgment;

 

b) not have participated in the preparation of the financial statements of the Company or any current subsidiary of the Company at any time during the past three years;

 

c) be able to read and understand fundamental financial statements, including the Company’s balance sheet, income statement and cash flow statement. If a director is not capable of understanding such fundamental financial statements, he or she must become able to do so within a reasonable period of time after appointment to the Committee; and

 

d) satisfy the independence requirements of Section 10A(m)(3) of the Securities Exchange Act of 1934 (the “Exchange Act”) and the rules and regulations of the Securities and Exchange Commission.

 

 

In particular, the Chairman of the Committee must have past employment experience in finance or accounting, requisite professional certification in accounting or any other comparable experience or background which results in the director’s financial sophistication.

 

Responsibilities

 

The Committee recognizes that the preparation of the Company’s financial statements and other financial information is the responsibility of the Company’s management and that the auditing, or conducting limited reviews, of those financial statements and other financial information is the responsibility of the Company’s independent auditors. The Committee’s responsibility is to oversee the financial reporting process.

 

The Company’s management and its independent auditors, in the exercise of their responsibilities, acquire greater knowledge and more detailed information about the Company and its financial affairs than the members of the Committee. Consequently, the Committee is not responsible for providing any expert or other special assurance as to the Company’s financial statements and other financial information or any professional certification as to the independent auditors’ work, including without limitation their reports on, and limited reviews of, the Company’s financial statements and other financial information. In addition, the Committee is entitled to rely on information provided by the Company’s management and the independent auditors with respect to the nature of services provided by the independent auditors and the fees paid for such services. The independent auditors will report directly to the Committee. The independent auditors are ultimately accountable to the Board and the Committee, as representatives of the shareholders.

 

In carrying out its responsibilities, the Committee will:

 

a) have the sole authority to appoint or replace the Company’s independent auditors (subject, if applicable, to shareholder ratification);

 

b) be directly responsible for the compensation and oversight of the work of the independent auditors (including resolution of any disagreements between management and the independent auditors regarding financial reporting) for the purpose of preparing or issuing an audit report or related work;

 

c) on an annual basis, review and reassess the adequacy of the Committee Charter annually and the Committee’s own performance;

 

d) require that the independent auditors provide the Committee with a formal written statement delineating all relationships between the independent auditors and the Company, consistent with Independence Standards Board Standard No. 1, and discuss with the independent auditors their independence;

e) pre-approve all auditing services, internal control-related services and permitted non-audit services (including the terms thereof) to be performed for the Company by its independent auditor, subject to the de minimus exceptions for non-audit services described in Section 10A(i)(1)(B) of the Exchange Act which are approved by the Committee prior to the completion of the audit;

f) have the authority to retain independent counsel and other legal, accounting or other advisors as it determines necessary to carry out its duties;

g) recommend to the Board guidelines for the Company’s hiring of employees of the independent auditing firm engaged on the Company’s account;

h) obtain and review a report from the independent auditor at least annually regarding:

(a) the independent auditor’s internal quality-control procedures,

(b) any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm,

(c) any steps taken to deal with any such issues, and

(d) all relationships between the independent auditor and the Company consistent with Independence Standards Board Standard No. 1.

actively engage in a dialogue with the independent auditors regarding any disclosed relationships or services that may impact the objectivity and independence of the independent auditors. Evaluate the qualifications, performance and independence of the independent auditor, including considering whether the auditor’s quality controls are adequate and the provision of permitted non-audit services is compatible with maintaining the auditor’s independence, taking into account the opinions of management and internal auditors. The Committee will present its conclusions with respect to the independent auditor to the Board;

i) obtain reports from Company management with responsibility for financial and auditing matters and from the independent auditors that the Company’s subsidiary/foreign affiliated entities are in conformity with applicable legal requirements and the Company’s Business Ethics Policy, including disclosures of insider and affiliated party transactions;

 

j) evaluate, together with the Board, the performance of the independent auditors and whether it is appropriate to adopt a policy of rotating independent auditors on a regular basis and, if so determined by the Committee, recommend that the Board replace the independent auditors;

 

k) assure regular rotation of the lead audit partner and the reviewing audit partner of the Company’s independent auditors;

 

l) take, or recommend that the full Board take, appropriate action to oversee the independence of the independent auditors;

 

m) review with management and the independent auditors the effect of regulatory and accounting initiatives as well as off-balance sheet structures on the Company’s financial statements;

n) review the experience and qualifications of the senior members of the independent auditors’ team and the quality control procedures of the independent auditor;

o) review and consider the matters identified in Statement on Auditing Standards No. 61 with the independent auditors and management, including any difficulties encountered in the course of the audit work, any restrictions on the scope of activities or access to requested information, and any significant disagreements with management;

p) review an analysis prepared by management and the independent auditors of significant financial reporting issues and judgments made in connection with the preparation of the Company’s financial statements, including an analysis of the effect of alternative GAAP methods on the Company’s financial statements and a description of any transactions as to which management obtained Statement on Auditing Standards No. 50 letters;

q) review with the independent auditors any problems or difficulties the independent auditors may have encountered and any management letter provided by the independent auditors and the Company’s response to that letter, including any difficulties encountered in the course of the audit work, any restrictions on the scope of activities or access to required information and any disagreements with management;

r) meet on a regular basis with the Company’s chief financial officer and the independent auditors;

s) provide appropriate and adequate opportunities for the Company’s independent auditor to report to the Committee:

(i) all critical accounting policies and practices to be used;

(ii) all alternative treatments of financial information within GAAP that have been discussed with management officials of the Company, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the Company’s outside auditor; and

(iii) other material written communications between the Company’s outside auditor and the management of the Company, such as any management letter or schedule of unadjusted differences;

 

t) consider whether the provision of the services by the independent auditors (other than those services rendered in respect of the audit or review of the Company’s annual or quarterly financial statements) is compatible with maintaining the independent auditor’s independence;

u) review and discuss the Company’s audited financial statements that are to be included in the Company’s Form 10-K with the independent auditors and management and determine whether to recommend to the Board of Directors that the financial statements be included in the Company’s Form 10-K for filing with the Securities and Exchange Commission;

v) review with management and the independent auditors any correspondence with regulators or governmental agencies and any employee complaints or published reports that raise material issues regarding the Company’s financial statements or accounting policies;

w) establish procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal control or auditing matters and the confidential, anonymous submission by employees of the Company regarding questionable accounting or auditing matters;

x) receive information from the Company’s management (including the Chief Executive Officer and the Chief Financial Officer) about any significant deficiencies and material weaknesses in the design or operation of internal controls that could adversely affect the Company’s ability to record, process, summarize and report financial data and any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal controls;

y) review the terms of proposed engagements of the independent auditors relating to services to the Company in connection with any formal investigation of possible fraud, financial statement misstatements or material weaknesses in internal controls, prior to such engagements;

z) obtain from the independent auditors assurance that Section 10A(b) of the Exchange Act has not been implicated;

aa) review with management and the independent auditors any matters identified by the independent auditors pursuant to Statement on Auditing Standards No. 71 regarding the Company’s interim financial statements prior to the filing of such interim financial statements on the Company’s Form 10-Q, including the results of the independent auditors’ review of the interim financial statements;

bb) discuss with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of the Company’s financial statements, including any significant changes in the Company’s selection or application of accounting principles, any major issues as to the adequacy of the Company’s internal controls and any special steps adopted in light of material control deficiencies;

cc) confirm that the none of the audit partners earn or receive compensation based on procuring engagements with the Company for providing products or services, other than audit review or attest services; and

dd) discuss with the national office of the independent auditor issues on which they were consulted by the Company’s audit team and matters of audit quality and consistency.

 

 

M1:1098795.02

 

 

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Compensation Committee Charter

ValueVision Media, Inc.

Human Resources and Compensation Committee Charter

 

1. Members. The Board of Directors of ValueVision, Media, Inc. (the “Company”) shall appoint a Human Resources and Compensation Committee (the “Committee”) of at least three members, consisting entirely of independent directors, and shall designate one member as chairperson. For purposes hereof, an “independent” director is a director who meets the NASDAQ Stock Market, Inc. (“NASDAQ”) definition of “independence,” as determined by the Board. Additionally, members of the Committee must qualify as “non-employee directors” for purposes of Rule 16b-3 under the Securities Exchange Act of 1934, as amended, and as “outside directors” for purposes of Section 162(m) of the Internal Revenue Code, as amended.

2. Purposes, Duties, and Responsibilities. The purpose of the Committee is to discharge the responsibilities of the Board relating to oversight of human resources management and employee compensation and benefits at the Company, including compensation of the Company’s CEO and senior officers, and to produce the annual report on executive compensation for inclusion in the Company’s proxy statement. The duties and responsibilities of the Committee are to:

(a) Review and approve a comprehensive compensation and benefits philosophy for the Company; oversee the Company’s overall compensation structure, personnel policies and programs; and assess whether the Company’s compensation structure establishes appropriate incentives for management and employees.

(b) Administer and make recommendations to the Board with respect to the Company’s incentive-compensation and equity-based compensation plans. Review and recommend to the Board the annual guidelines and performance objectives for the Management Incentive Plan or similar or successor plans.

(c) Review and approve corporate goals and objectives relevant to the compensation of the CEO, evaluate the CEO’s performance in light of those goals and objectives, and recommend to the Board the CEO’s compensation level based on this evaluation and consistent with applicable employment agreements or other contractual obligations.

(d) Review and set the compensation of other senior officers based upon the recommendation of the CEO.

(e) Approve stock option and other stock incentive awards for senior officers.

(f) Serve as the Plan Committee for the Company’s 401(k) Savings Plan, with authority to oversee the Plan as set forth in the Plan documents; and to serve as the Plan Committee for the Company’s 2001 and 2004 Omnibus Stock Plans and for other equity incentive and similar plans as may be adopted by the Company or approved by the shareholders in the future.

(g) Review and approve the design of other benefit plans pertaining to senior officers.

(h) Review and recommend employment agreements and severance arrangements for the CEO and senior officers, including change-in-control provisions, plans or agreements.

(i) Approve, amend or modify the terms of any compensation or benefit plan that does not require shareholder approval.

(j) Review periodically succession plans for the CEO and for senior officers, and make recommendations to the Board regarding the selection of individuals to fill these positions.

(k) Annually evaluate the performance of the Committee and the adequacy of the committee’s charter and report its evaluation to the Board.

(l) Perform such other duties and responsibilities as are consistent with the purpose of the Committee and as the Board or the committee deems appropriate.

 

3. Subcommittees. The Committee may delegate any of the foregoing duties and responsibilities to a subcommittee of the Committee consisting of not less than two members of the Committee.

4. Outside Advisors. The Committee will have the authority to retain at the expense of the Company such outside counsel, experts, and other advisors as it determines appropriate to assist it in the full performance of its functions, including sole authority to retain and terminate any compensation consultant used to assist the committee in the evaluation of director, CEO or senior executive compensation, and to approve the consultant’s fees and other retention terms.

5. Meetings. The Committee will meet as often as may be deemed necessary or appropriate, in its judgment, either in person or telephonically, and at such times and places as the Committee determines. The majority of the members of the Committee constitutes a quorum. The Committee will report regularly to the full Board with respect to its activities.