2003 Committee Charter : DPL
CHARTER OF COMPENSATION COMMITTEE
(as adopted January 28, 2003)
The Compensation Committee of DPL Inc. (the "Company") shall consist of at least
three directors, all of whom shall be independent as such term is defined by relevant law and
the New York Stock Exchange listing standards. Additionally, no director may serve on the
Committee unless he or she (1) is a "Non-Employee Director" for purposes of Rule 16b-3 under
the Securities Exchange Act of 1934, and (2) satisfies the requirements of an "outside director"
for purposes of Section 162(m) of the Internal Revenue Code. Committee members shall be
appointed by the Board of Directors on the recommendation of the Nominating and Corporate
Governance Committee. Committee members shall hold their offices for one year and until their
successors are elected and qualified, or until their earlier resignation or removal. All vacancies
in the Committee shall be filled by the Board based on the recommendations of the Nominating
and Corporate Governance Committee.
The Board shall designate one of the members as Chairman of the Committee and the
Committee shall meet periodically, as deemed necessary by the Chairman of the Committee,
but in no event less than three times a year. A representative from the Company shall give
notice, personally or by mail, telephone, facsimile or electronically, to each member of the
Committee of all meetings not later than 12 noon of the day before the meeting, unless all of the
members of the Committee in office waive notice thereof in writing at or before the meeting, in
which case the meeting may be held without the aforesaid advance notice. A majority of the
members of the Committee shall constitute a quorum for the transaction of business.
The Committee may form one or more subcommittees, each of which may take such
actions as may be delegated by the Committee. The Committee shall periodically report on its
activities to the Board and make such recommendations and findings as it deems appropriate.
Each Committee must perform an annual evaluation of such Committee in accordance with the
NYSE listing standards.
The Committee is charged with the broad responsibility of overseeing that the senior
executives of the Company and its subsidiaries are effectively compensated in terms of salaries,
supplemental compensation and benefits which are internally equitable and externally
competitive. Specifically, the Committee's primary duties and responsibilities shall be to:
· develop and recommend to the Board total compensation for senior
executives, including oversight of all senior executive benefit plans, including
· oversee the Company's incentive plans;
· oversee the Company's qualified defined benefit pension plans;
· produce an annual report on executive compensation for inclusion in the
Company's annual proxy statement;
· perform such other similar duties and responsibilities which may be referred
to the Committee from time to time by the full Board of Directors; and
· review and recommend to the full Board of Directors any employment
contracts or consulting arrangements between the Company and any current
or former employees or directors.
· Engage compensation consultants and obtain necessary comfort letters.
Duties and Authority
To fulfill its responsibilities and duties, the Committee shall:
Compensation and Benefits
1. Establish the total compensation package provided to the Chief Executive Officer
or most senior officer of the Company, as well as such other officers of the
Company whose compensation is disclosed in the Company's proxy statement,
and review and/or approve the actual compensation, including base pay
adjustments, stock incentive unit grants, stock options, and any annual and
long-term incentive payouts paid to senior executive officers of the Company.
The Committee should be involved with any employment agreements, severance
agreement or change of control agreements between the Company and its senior
executive officers. Specifically as to the Chief Executive Officer, annually review
and approve the goals and objectives relevant to the Chief Executive Officer's
compensation, evaluate the Chief Executive Officer's performance in light of
those goals and objectives and set the Chief Executive's compensation level
based on this evaluation.
2. As part of its review and establishment of the performance criteria and
compensation of designated officers, the Committee should meet separately on
an annual basis with the Chief Executive Officer and any other executive officers.
The Committee shall also meet without such officers present and in all cases
such officers shall not be present at Committee meetings at which their
performance and compensation are being discussed and determined.
3. Review and approve the design of the benefit plans which pertain to the Chief
Executive Officer and other senior executive officers who report directly to the
Chief Executive Officer.
4. Review and recommend to the Board the creation and/or revision of incentive
compensation plans and equity-based plans.
5. Draft and approve the Compensation Committee Report on Executive
Compensation included in the Company's annual proxy statement and generally
oversee compliance with the compensation reporting requirements of the SEC.
6. The Committee shall have sole authority to retain, at the Company's expense,
and terminate consultants to advise the Committee on executive compensation
practices, policies and related matters, and the sole authority to approve fees
and other retention terms. The Committee shall also have sole authority to
obtain and receive advice and assistance from internal or external legal or other
advisors at the Company's expense.
7. Obtain through discussions with management of the Company a general
understanding of compensation design throughout the entire organization. The
Committee may ask senior management to present items of importance directly
to the Committee for consideration, such as:
· Programs which are responsive to and compliant with government rules and
regulations to promote equal opportunity for employee applicants and current
· Personnel policies designated to attract qualified personnel to the Company
and its subsidiaries and programs designed to develop the talents and abilities
of current Company employees; and
· Report on which of the Company's junior executives are ready to assume
increased management responsibilities.
Benefit and Pension Plans
1. Establish the design of the benefit plans that pertain to the Chief Executive
Officer and senior executive officers of the Company who report directly to the
Chief Executive Officer.
2. Review and recommend to the Board changes to or adoption of qualified pension
plans and non-qualified plans of the Company and conduct periodic reviews of
plan asset investments and approve periodically investment and funding
guidelines developed by the Committee.