CSG Systems International, Inc.
A Delaware corporation
("CSG")

Adopted November 20, 2003

 

Purpose

The Compensation Committee is created by the Board of Directors of CSG (the "Board") to:

·         review and recommend to the Board CSG’s senior management compensation and benefits policies generally;

·         evaluate the performance of the executive officers of CSG;

·         review and recommend to the Board the compensation of CSG’s executive officers; and

·         prepare the report on executive compensation that Securities and Exchange Commission rules require to be included in the proxy statement for CSG's annual meeting of stockholders.

Membership

The Compensation Committee shall consist of at least two members, all of whom shall be independent directors as defined in Rule 4200(a)(15) of the National Association of Securities Dealers, Inc. and also shall be "outside directors" for purposes of Section 162(m) of the Internal Revenue Code of 1986. The Nominating and Corporate Governance Committee shall recommend to the Board nominees for appointment to the Compensation Committee. Compensation Committee members shall be appointed by the Board and may be removed by the Board at any time. The Nominating and Corporate Governance Committee shall recommend to the Board, and the Board shall designate, the Chair of the Compensation Committee.

Authority and Responsibilities

In addition to any other responsibilities which may be assigned from time to time by the Board, the Compensation Committee is responsible for the following matters.

Compensation Policies

·         The Compensation Committee shall review and recommend to the Board CSG’s senior management compensation and benefits policies generally (subject, if applicable, to shareholder ratification), including any incentive-compensation plans and equity-based plans of CSG. In reviewing and recommending such compensation and benefits policies, the Compensation Committee may consider the recruitment, development, promotion, retention and compensation of senior executives and other employees of CSG and any other factors that it deems appropriate. The Compensation Committee shall report to the Board the results of such review and its recommendations with respect to CSG’s senior management compensation and benefits policies.

Executive Officer Compensation

·         The Compensation Committee shall review and recommend to the Board for each of CSG’s executive officers his or her (i) annual base salary, (ii) annual incentive compensation, (iii) long-term incentive compensation, (iv) employment, severance and change-in-control agreements, if any, and (v) any other compensation, ongoing perquisites or special benefit items. In so reviewing and recommending executive officer compensation, the Compensation Committee shall, among other things:

o        identify corporate goals and objectives relevant to executive officer compensation;

o        evaluate each executive officer’s performance in light of such goals and objectives and approve each executive officer's compensation based on such evaluation and such other factors as the Compensation Committee deems appropriate and in the best interests of CSG (including the cost to CSG of such compensation); and

o        determine any long-term incentive component of each executive officer's compensation, taking into account awards made to such executive officer in past years, CSG’s business and financial performance, shareholder return, the value of similar incentive awards at comparable companies and such other factors as the Compensation Committee deems appropriate and in the best interests of CSG (including the cost to CSG of such compensation).

·         The Compensation Committee shall report to the Board the results of such review and its recommendations with respect to the compensation of CSG’s executive officers.

·         The Compensation Committee may delegate to one or more officers of CSG the authority to make grants and awards to any non-Section 16 officer or employee of CSG under such of CSG’s incentive-compensation or other equity-based plans as the Compensation Committee deems appropriate and in accordance with the terms of such plans.

Disclosure

·         The Compensation Committee shall prepare the report on executive compensation that Securities and Exchange Commission rules require to be included in the proxy statement for CSG's annual meeting of stockholders.

Reporting to the Board

·         The Compensation Committee shall report to the Board periodically. Each report shall include a review of any recommendations or issues that arise with respect to CSG compensation and benefits policies, executive officer compensation and any other matters that the Compensation Committee deems appropriate or is requested by the Board to include.

·         The Compensation Committee shall periodically review and assess the adequacy of this charter and recommend any proposed changes to the Board.

·         The Committee shall annually evaluate its own performance and report to the Board on such evaluation.

Procedures

The Compensation Committee shall meet as often as it determines is necessary or appropriate to carry out its responsibilities under this charter. The Chair of the Compensation Committee, in consultation with the other committee members, shall determine the frequency and length of the Compensation Committee meetings and shall set meeting agendas consistent with this charter.

The Compensation Committee has the sole authority to retain and terminate any compensation consultant assisting the Compensation Committee in the evaluation of the compensation of the Chief Executive Officer ("CEO"), other executive officers of CSG or CSG's senior management, including sole authority to approve all such compensation consultant’s fees and other retention terms.

The Compensation Committee may delegate its authority to subcommittees or the Chair of the Compensation Committee when it deems such delegation to be appropriate and in the best interests of CSG.

The CEO may not be present during deliberations or voting by the Compensation Committee regarding the compensation of the CEO.