PHOENIX TECHNOLOGIES LTD.

CHARTER OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS

 

Purpose

 

The purpose of the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of Phoenix Technologies Ltd. (the “Company”) shall be to make recommendations to the Board relating to Company compensation and to carry out the compensation-related responsibilities set forth below or as otherwise delegated to the Committee by the Board.

 

Structure

 

The Committee shall be comprised of at least three members of the Board, each of whom shall be appointed by and serve at the pleasure of the Board. The chairman of the Committee shall be designated by the Board. No member of the Committee will be an employee or a former officer of the Company. Each Committee member shall be: (i) a “Non-Employee Director” under Rule 16b-3(b)(3)(i) promulgated under the Securities Exchange Act of 1934, as amended (the “34 Act”); (ii) an “outside director” under the rules promulgated under Section 162(m) of the Internal Revenue Code of 1986, as amended; and (iii) an “independent director” under NASDAQ Rule 4200(a)(15) (except to the extent that a non-independent director may qualify for membership under NASDAQ Rule 4350(c)(3)(C)).

 

Procedure

 

If one or more members of the Committee is absent from a meeting of the Committee, a majority of the remaining members of the Committee (provided there are at least two such members) shall have the power to take any action necessary, proper or advisable in order to perform the Committee’s purpose. No action of the Committee shall be valid unless taken pursuant to a resolution adopted and approved by at least two members of the Committee. The Committee may ask members of management of the Company or others to attend Committee meetings and provide pertinent information when needed. The Committee will meet at such times as it deems appropriate.

 

Responsibilities

 

The Committee shall have the following specific responsibilities (and the delegated authority to carry them out):

 

 

1.

Establish an annual compensation plan (covering base salaries, bonus opportunities and long-term/equity incentives) for the Chief Executive Officer and the other executive officers of the Company based on achievement of established corporate goals and objectives.

 

 

2.

Consistent with the established compensation plan, determine the Chief Executive Officer’s and other executive officers’ compensation based upon an annual evaluation of their performances.

 

 

3.

Establish, annually review and modify as necessary or advisable the terms and conditions of employment of the executive officers, including, without limitation, executive perquisites and change of control benefits.

 

 

4.

Prepare an annual report on executive compensation for inclusion in the Company’s proxy statement.

 

 

5.

Annually review all non-employee director compensation programs and policies and make recommendations to the Board with respect to any changes to the compensation of non-employee directors.

 

 

6.

Periodically review the Company’s long-term incentive/equity compensation strategy.

 

 

7.

Administer, interpret and determine all awards pursuant to all of the Company’s stock-based incentive compensation plans.

 

 

8.

Periodically advise the Board regarding regional and industry-wide compensation practices and trends and make recommendations to the Board regarding the adequacy and competitiveness of the Company’s compensation programs.

 

 

9.

Hire such outside compensation experts as may be necessary or proper to assist the Committee in the performance of its purpose and review the performance of such experts at least annually with input from management.

 

 

10.

Annually, together with the Board, review its own performance.

 

 

11.

Annually review and assess this charter and submit any proposed changes for the approval of the Board.

 

 

12.

Periodically update the Board about Committee activities and recommendations.

 

 

13.

Perform other functions as requested by the Board.