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2003 Compensation Charter: SJM
THE J. M. SMUCKER COMPANY
EXECUTIVE COMPENSATION COMMITTEE CHARTER
(Adopted April 15, 2003)
The primary responsibility of the executive compensation committee shall be to approve
the compensation arrangements for the Company's senior management and to
periodically review the compensation paid to the Board, as such responsibilities are
more specifically identified below.
The size of the committee shall be determined by the Board, provided that the
committee shall always have at least three members.
Each committee member will be "independent" under the rules of the New York Stock
Exchange and the Company's corporate governance guidelines. Specifically, the
members of the committee shall be independent of management and free from any
relationship that, in the opinion of the Board, could interfere with the exercise of
independent judgment for the purpose of determining the fairness of compensation
arrangements for senior management and providing the recipients of compensation the
protection afforded by such independent oversight.
The Board selects committee members and the committee chair. Each committee
member will serve at the pleasure of the Board for such term as the Board may decide
or until such committee member is no longer a Board member.
Duties and Responsibilities
The following are the duties and responsibilities of the committee:
In consultation with senior management, the committee shall develop and
implement the Company's compensation program for executive officers,
including determination of amounts paid out under the Company's Management
Incentive Program ("MIP").
The committee shall review and approve, at least annually, corporate goals and
objectives relating to the compensation of the co-CEOs and the other executive
officers of the Company and evaluate the co-CEOs' performances in light of
those goals and make recommendations to the Board with respect to the
Company's MIP and other equity-based plans. The committee will set the
compensation of the co-CEOs, the Company's executive officers, and selected
other senior managers.
The committee shall review and approve the Company's equity incentive plans
and grants of stock options and other equity or equity-based awards, in the
manner and on such terms and conditions as may be prescribed by the
Company's equity incentive plans.
The committee shall review issues relating to management succession, as
In consultation with senior management, the committee shall oversee regulatory
compliance with respect to compensation matters.
The committee shall review and, as appropriate, make recommendations to the
Board regarding the compensation paid to the nonemployee members of the
Board. In its periodic evaluation of Board compensation, the committee will refer
to the policy statement on Board compensation attached to this charter as
The committee shall report its activities to the Board in such manner and at such
times as the committee or the Board deem appropriate.
The committee shall meet as frequently as necessary to carry out its responsibilities
under this charter. The committee chair shall conduct the meetings and shall have such
other responsibilities as the committee or the Board may designate from time to time.
The committee may request any officer of the Company, or any representative of the
Company's advisors, to attend a meeting or to meet with any member or representative
of the committee.
Resources and Authority
The committee shall have appropriate resources and authority to discharge its
responsibilities, including reasonable funding to compensate any consultants and any
independent advisors retained by the committee. The committee shall have the
authority to engage compensation consultants to assist in the evaluation of director or
executive officer compensation and the authority to set the fees and other retention
terms of such compensation consultants.
Compensation Committee Report
The committee, with the assistance of management and any outside consultants the
committee deems appropriate, shall prepare a report for inclusion in the Company's
proxy statement relating to the Company's annual meeting of shareholders.
At least annually, the committee shall review this charter and evaluate its performance
against the requirements of this charter. The committee shall conduct its review and
evaluation in such manner as it deems appropriate.
TO THE J. M. SMUCKER COMPANY
EXECUTIVE COMPENSATION COMMITTEE CHARTER
BOARD OF DIRECTOR COMPENSATION
The Executive Compensation Committee of The J. M. Smucker Company is responsible
for periodically, as appropriate, reviewing the compensation for Board members. Any
suggested recommendations for changes shall be submitted to the full Board for review.
This Policy Statement has been adopted to suggest general principles that the
committee intends to follow.
1. The committee, or a subcommittee designated by the committee, with the
assistance of outside compensation experts, will periodically benchmark the
compensation of directors against companies of similar size in similar industries.
2. Director compensation should be a combination of cash and company shares
and should periodically be reevaluated to determine appropriate percentages of
cash and shares.
3. A portion of the share component of compensation should be in the form of
options and/or deferred stock.
4. Directors should be able to elect to defer a portion of compensation until their
Board service is completed.
5. Directors should be reimbursed for their reasonable travel and other expenses
related to Board service.
6. The current policy encourages director participation in The J. M. Smucker
Company Matching Gifts Program.