The primary purposes of the Human Resources and Compensation Committee (the "Committee") of the Board of Directors (the "Board") of Orbital Sciences Corporation (the "Company") are to (i) oversee the compensation of the Company's executives, including its Chief Executive Officer ("CEO"), (ii) make recommendations to the Board with respect to the Company's incentive-compensation plans and equity-based compensation plans, and (iii) produce a report on executive compensation as required by the Securities and Exchange Commission ("SEC") to be included in the Company's annual proxy statement or Annual Report on Form 10-K filed with the SEC.
II. COMMITTEE MEMBERSHIP
The Committee shall consist of at least three directors, each of whom shall (a) meet the independence requirements of the New York Stock Exchange, (b) be a "non-employee director" within the meaning of Rule 16b-3 under the federal securities laws, (c) be an "outside director" within the meaning of the Treasury Regulations promulgated under Section 162(m) of the Internal Revenue Code, and (d) meet any other legal requirements relevant to the proper administration of the Company's executive compensation plans and programs, including requirements under the federal securities laws and the Internal Revenue Code of 1986, as amended.
The Chairman and other members of the Committee shall be appointed by the Board. Committee members may be removed by the Board, with or without cause. Any member of the Committee may resign at any time by giving written notice of his or her resignation to the Board.
The Committee shall hold at least two regular meetings annually, and shall meet more frequently as deemed necessary to fulfill the responsibilities prescribed in this Charter or by the Board. The Chairman of the Committee may call special meetings of the Committee as required.
IV. COMMITTEE AUTHORITY AND RESPONSIBILITIES
The Committee shall:
1. Review and approve corporate goals and objectives relevant to the position and compensation of the CEO, formally evaluate the CEO's performance in light of those goals and objectives, and, either as a Committee or together with the other independent directors (as directed by the Board), determine and approve the CEO's compensation (including base salary and all incentives and perquisites) based on this evaluation. In determining the long-term incentive component of the CEO's compensation, the Committee shall consider, among other factors, the Company's overall 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.
2. In conjunction with the annual evaluation of management performed by the Corporate Governance and Nominating Committee, consider and approve the compensation (including base salary and all incentives and perquisites) of all executives, as identified by the Committee.
3. Approve the terms of, and any renewals, amendments or waivers to, employment agreements with executives, indemnification agreements, and any other agreements containing compensation or benefit provisions related to a change in control. The Committee shall also approve any severance arrangements with executives that contain provisions which vary from the Company's standard severance policy.
4. Implement and administer the Company's incentive compensation plans, equity-based compensation plans and programs and retirement plans. The Committee shall, if appropriate, recommend amendments to existing plans and the introduction of new incentive and equity-based compensation plans to the Board.
5. Oversee and monitor matters involving workforce related issues and trends and management education and training programs.
6. Assist the Board in developing and evaluating potential candidates for executive positions (other than the CEO) and oversee the development of executive succession plans. (The Corporate Governance and Nominating Committee is responsible for CEO succession planning.)
7. Prepare and issue the report, as required by the SEC, for inclusion in the Company's annual meeting proxy statement or Annual Report on Form 10-K, as applicable.
8. Review and reassess the adequacy of this Charter annually, or more frequently as necessary, and recommend any proposed changes to the Board for approval.
9. Annually perform a self-evaluation of its performance for review and discussion by the Board.
10. Make regular reports to the Board regarding the status and disposition of the above matters.
11. Have such other authority and responsibilities as may be assigned to it from time to time by the Board.
The Committee shall have the sole authority to retain and terminate consulting firms to assist in the evaluation of CEO or other executive compensation, including the sole authority to approve such firm's fees and other retention terms. The Committee shall also have the authority to delegate authority to such subcommittees, as it deems appropriate and in the best interest of the Company and its shareholders, provided that, to the extent required by applicable rules and regulations, such subcommittees are composed entirely of independent directors and have published committee charters.
This Charter shall be posted on the Company's website.
(Adopted July 24, 2003; amended April 30, 2004)