The Nominating and Corporate Governance Committee (the "Committee") of the Board of Directors (the "Board") of NeighborCare, Inc. (the "Company") is appointed by the Board to assist the Board in fulfilling its responsibilities relating to: (i) the identification, screening and selection of qualified individuals to become directors and members of committees of the Board; (ii) the development and recommendation of corporate governance principles and policies to the Board and the periodic monitoring and updating of such principles and policies; and (iii) the oversight of the evaluation of the Board and management of the Company.
The Committee shall be comprised of no fewer than three members, each of whom must qualify as an "Independent Director" under the listing standards of the Nasdaq Stock Market, Inc. ("NASDAQ"). Such listing standards are referred to herein as the "NASDAQ Marketplace Rules."
The Board shall appoint the members of the Committee. The Board shall appoint one member of the Committee to serve as Chairperson. If the Board fails to appoint a Chairperson, the members of the Committee shall elect a Chairperson by majority vote. The Chairperson shall be responsible for leadership of the Committee, including overseeing the agenda, presiding over meetings and reporting to the Board.
Subject to earlier removal by the Board or resignation, each member shall serve until his or her successor is duly elected and qualified. A Committee member may be removed, with or without cause, by a majority vote of the Board. The Board shall have the authority to fill vacancies or add additional members to the Committee.
A member of the Committee shall promptly notify the Committee and the Board if he or she is no longer an Independent Director and such member shall be removed from the Committee unless otherwise determined by the Board.
The Committee may form and delegate authority to subcommittees of the Committee when appropriate.
III. Structure and Meetings
The Committee shall hold at least two meetings per year, or more frequently as the Chairperson determines is warranted under the circumstances in order for the Committee to fulfill its mandate. The Chairman of the Board or any member of the Committee may call meetings of the Committee. All meetings of the Committee may be held telephonically.
The Chairperson shall, after consultation with the other members of the Committee, (i) determine the dates, times and places for meetings of the Committee, and (ii) set the agenda for each meeting. Any item proposed by a member of the Committee for inclusion in the agenda of a meeting shall be added to the agenda of such meeting. If the Chairperson is not present at a meeting, the remaining members of the Committee may designate an acting Chairperson for purposes of such meeting. A majority of the members of the Committee then in office shall constitute a quorum for the transaction of Committee business. All matters to be decided by the Committee shall be decided by the affirmative vote of a majority of the members participating (whether in person or telephonically) in a duly called meeting of the Committee or by the written consent of all of the members.
The Committee may request that any directors, officers or employees of the Company, or other persons whose advice and counsel are sought, attend any meeting of the Committee and/or provide such pertinent information as the Committee requests, except that no director of the Company shall participate in discussions or attend any portion of a meeting of the Committee at which that director's nomination or committee selection is being discussed.
Following each of its meetings, the Committee shall deliver a report, which may be oral, on the meeting to the Board, including a description of all actions taken by the Committee at the meeting.
The Committee shall keep written minutes of its meetings, which minutes shall be maintained by the Company with the books and records of the Company. The Chairperson may designate an officer or employee of the Company to serve as secretary to the Committee.
The Committee is authorized to adopt its own rules or procedure not
inconsistent with (i) any provision hereof; (ii) any provision
of the Articles of Incorporation or By-Laws of the Company; and (iii) the laws
IV. Duties and Responsibilities
The Committee shall have the following authority, duties and responsibilities:
Board Selection, Evaluation and Committee Membership
1. Determine what types of backgrounds are needed to help strengthen and balance the Board and establish the process for identifying and evaluating candidates for director, including but not limited to establishing criteria for selecting new directors. In identifying candidates, the Committee may take into account all factors it considers appropriate, which may include: (i) ensuring that the Board is diverse and consists of individuals with various and relevant career experience, industry knowledge and experience, financial expertise (including expertise that could qualify a director as a "financial expert" as defined in the rules and regulations of the Securities and Exchange Commission (the "SEC"), local or community ties, and (ii) minimum individual qualifications, including exemplary personal integrity and reputation, sound judgment, strong decision-making ability, substantial management experience, familiarity with the Company's business, other business and professional commitments, including membership on other boards of directors, and whether the candidate meets the independence requirements of the NASDAQ Marketplace Rules and the rules and regulations of the SEC.
2. Conduct all necessary and appropriate inquiries into the backgrounds and qualifications of all candidates.
3. Consider questions of independence and possible conflicts of interest of directors and executive officers and whether a candidate has special interests that would impair his or her ability to effectively represent the interests of all shareholders.
4. Evaluate candidates for nomination to the Board, including those standing for re-election and those recommended by shareholders, and make recommendations to the Board, except if and to the extent the Company is legally required by contract or otherwise to provide a third party with the ability to nominate directors, in which case the selection and nomination of such director need not be subject to action by the Committee.
5. In the case of a director nominated to fill a vacancy on the Board due to an increase in the size of the Board, recommend to the Board the class of directors in which the nominee should serve.
6. Recommend to the Board those directors to be selected for membership on committees of the Board, which such recommendations should consider the qualifications for membership on each committee, whether the director will be able to devote the requisite time to the committee(s), the extent to which there should be a policy of periodic rotation of directors among committees and any limitations on the number of consecutive years a director should serve on any one Board committee, and, where appropriate, make recommendations regarding the removal of any member of a committee.
7. Recommend to the Board directors to serve as chairpersons of the committees of the Board.
8. Recommend to the Board the compensation for directors, including retainer, committee and committee chairperson fees, stock options, restricted stock awards and similar awards as appropriate.
9. Monitor compliance with the Company's policies regarding the consideration of candidates recommended by shareholders and procedures to be followed by shareholders in submitting recommendations for director candidates, as set forth in the Company's By-Laws.
10. Establish policies regarding shareholder communications with directors and procedures to be followed by shareholders in submitting such communications.
11. Establish policies regarding director attendance at annual meetings of shareholders.
12. Periodically review the charter, composition and performance of each committee of the Board and make recommendations to the Board for the creation of additional committees or the elimination of committees of the Board.
13. Develop and promote procedures or programs for the orientation of new directors and continuing education of directors.
14. Review the adequacy of the Company's articles of incorporation and bylaws and recommend to the Board, as and if necessary, any amendments to the same for consideration by the Board or shareholders, as appropriate.
15. Recommend to the Board policies to enhance the effectiveness of the Board, including with respect to the distribution of information to the directors, the size and composition of the Board and the frequency and structure of Board meetings.
16. Develop and recommend to the Board, and review periodically, a set of corporate governance guidelines and principles to ensure the Company's compliance with the NASDAQ Marketplace Rules, the rules of the SEC and all other applicable laws and regulations, including the requirement that the Company's Independent Directors meet at regularly scheduled executive sessions without Company management and the establishment and maintenance of a Code of Conduct for directors, officers and employees (as required by the NASDAQ Marketplace Rules) and a Code of Ethics (as required by the Sarbanes-Oxley Act of 2002), and recommend any required or desirable changes to the Board.
17. Assist management of the Company in the review of director and officer liability insurance requirements and the alternative methods available for satisfying such requirements.
Evaluate the Board and Management
18. Oversee the evaluation of the Board as a whole, the directors and management of the Company.
Succession Planning, Evaluation and Other
19. Develop and evaluate potential candidates for senior management and oversee the succession plan for senior management and the chief executive officer, including the development of policies and principles for the succession of the chief executive officer in the event of retirement or emergency, in order to ensure management continuity.
20. Review and evaluate the performance of the Committee and its members annually, including a review of the compliance of the Committee with this Charter and an assessment of the adequacy of this Charter and recommendation to the Board of any improvements the Committee considers necessary or valuable.
21. Perform such other duties and responsibilities as may be assigned to the Committee from time to time by the Board.
V. Additional Authority
The Committee is authorized to perform other duties or adopt other policies or procedures, consistent with the scope of this Charter, as may be appropriate in light of changing business, legislative, regulatory, legal or other conditions. In performing its duties and responsibilities, the Committee shall have the authority to obtain the advice, counsel or assistance from internal or external legal, accounting or other persons at the Company's expense and shall have sole authority to approve the any such person's fees and other retention terms.