Management Development and Executive Compensation Committee Charter

A.

Name

There shall be a committee of the Board of Trustees (the "Board") of Archstone-Smith Trust (the "Company"), which shall be called the Management Development and Executive Compensation Committee (the "Committee").

 

B.

Purpose

The Committee shall

  1. discharge the Board's responsibilities relating to compensation of the Company's executive officers and
  2. produce an annual report on executive compensation for inclusion in the Company's proxy statement in accordance with applicable rules and regulations.

 

C.

Committee Membership and Procedure

The Committee shall consist of no fewer than three members. Each member of the Committee shall satisfy the independence requirements of the New York Stock Exchange and, if deemed appropriate from time to time, meet the definition of "non-employee director" under Rule 16b-3 under the Securities Exchange Act of 1934, and "outside director" for purposes of Section 162(m) of the Internal Revenue Code of 1986. The Board shall appoint the members of the Committee annually, considering the recommendation of the Nominating and Corporate Governance Committee, and further considering the views of the Chairman of the Board and the Chief Executive Officer, as appropriate. The members of the Committee shall serve until their successors are appointed and qualify, and shall designate one of the members as the Chairman of the Committee. The Board shall have the power at any time to change the membership of the Committee and to fill vacancies in it, subject to such new member(s) satisfying the above requirements. Except as expressly provided in this Charter or the By-Laws of the Company or the Corporate Governance Guidelines of the Company, the Committee shall fix its own rules of procedure.

 

D.

Committee Authority and Responsibilities

  • The Committee shall review and approve corporate goals and objectives relevant to Chief Executive Officer compensation, evaluate the Chief Executive Officer's performance in light of those goals and objectives, and set the Chief Executive Officer's compensation level based on this evaluation.
  • In determining the long-term incentive component of Chief Executive Officer compensation, the Committee should consider the Chief Executive Office's achievements of the goals and objectives established for the Chief Executive Officer for the prior fiscal year, including the Company's performance and relative shareholder return, the value of similar incentive awards to chief executive officers at comparable companies, and the awards given to the Company's Chief Executive Officer in past years.
  • The Committee shall make recommendations to the Board with respect to incentive compensation plans and equity-based plans.
  • The Committee shall have the sole authority to retain and terminate any compensation consultant to be used to assist in the evaluation of Trustee, Chief Executive Officer or senior executive compensation and shall have sole authority to approve the consultant's fees and other retention terms, although it may delegate to management any or all of such actions. The Committee shall also have authority to obtain advice and assistance from internal or external legal or other advisors.
  • The Committee shall evaluate from time to time, the compensation to be paid to the Trustees for their service on the Board or any committee thereof.
  • The Committee shall adopt, administer, approve and ratify awards under incentive compensation and stock plans, including amendments to the awards made under any such plans, and review and monitor awards under such plans.
  • The Committee will conduct an annual review of the performance and compensation of the Chief Executive Officer. The Committee will establish and review such formal or informal policies and procedures, consulting with the Board, the Chief Executive Officer and others, as it considers appropriate, regarding succession to the Chief Executive Officer in the event of emergency, death or retirement.
  • The Committee shall periodically review the Company's philosophy regarding executive compensation and advise the Chief Executive Officer relative to different compensation approaches.
  • The Committee shall, from time to time as it deems appropriate, assess the Company's competitive position for the components of executive compensation by reviewing executive compensation surveys, studies and information concerning the compensation paid by other companies.
  • The Committee shall meet annually with the Chief Executive Officer to receive the Chief Executive Officer's recommendations concerning performance goals and the Chief Executive Officer's evaluation of the Company's progress toward meeting those goals.
  • The Committee shall annually review and approve, for the Chief Executive Officer and the senior executives of the Company, (1) employment agreements, severance arrangements and change in control agreements or provisions, in each case, when and if appropriate, and (2) any special or supplemental benefits.
  • The Committee shall oversee the evaluation of the management of the Company and make recommendations to the Board as appropriate.
  • The Committee shall make regular reports to the Board.
  • The Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval. The Board shall annually review the performance of the Committee.
  • The Committee may form and delegate authority to subcommittees when appropriate.