Board Committees

The Board of Directors conducts its business through meetings of the Board and the following standing committees:

The charters of each of these committees were approved by the Board of Directors on February 23, 2006.

EXECUTIVE COMMITTEE CHARTER

Purpose
The primary function of the Executive Committee is to facilitate the management of the business and affairs of the Company when the Board of Directors is not in session.

Membership
The Committee shall:

  • Be appointed by the Board of Directors, who has the sole authority to appoint and remove members.
  • Be comprised of a minimum of five members of the Board of Directors.
  • Include the Chairman of the Board, Chief Executive Officer and three members who satisfy all applicable independence requirements.

Duties and Responsibilities
The Committee shall:

  • Manage the business and affairs of the Company in the interim between meetings of the Board of Directors.
  • Have and may exercise the powers of the Board, except as limited by Maryland statute, the Articles of Incorporation or Bylaws.
  • Periodically review and assess its Charter and recommend any changes to the full Board for approval.
  • Have the power, in its discretion, to retain at the Company's expense such independent counsel and other advisors and experts, as it deems necessary or appropriate to carry out its duties.
  • Meet as often as necessary, or act by written consent, to enable it to fulfill its responsibilities and duties as set forth therein.
  • Report any actions taken or matters discussed at each meeting of the Committee.
  • Take such other action and do such other things as may be referred to it from time to time by the Board.

Limitations
The Committee shall not have the authority to:

  • Amend the bylaws or recommend to the stockholders any action or matter that requires stockholder approval under Maryland law.
  • Take any action or address any matter reserved or committed to another committee of the Board under the Bylaws of the company or under the charter of any other committee adopted by the Board.
  • Address any matter or take any action that is not otherwise not within the authority of the Committee as determined by the action of the Board.

 

AUDIT COMMITTEE CHARTER

Purpose and Responsibility
The primary function of the Audit Committee is to represent and assist the Board in fulfilling its oversight responsibility regarding:

  • The integrity of the Company's financial statements.
  • The appropriateness of the Company's accounting policies.
  • The adequacy of the Company's internal controls and the integrity of the Company's financial information reported to the public.
  • The performance of the Company's internal audit function.
  • The selection, qualifications, independence and performance of the Company's Independent Auditors.
  • The Company's compliance with legal and regulatory requirements.

It is not the duty of the Audit Committee to plan or conduct audits or to determine that the Company's financial statements are complete and accurate and are in accordance with generally accepted accounting principles. Management is responsible for the preparation, presentation, and integrity of the Company's financial statements, for the appropriateness of the accounting principles and reporting policies that are used by the Company, and for implementing and maintaining internal control over financial reporting. The independent auditor is responsible for auditing the Company's financial statements and for reviewing the Company's unaudited interim financial statements.

Membership
The Audit Committee shall:

  • Be comprised of a minimum of three members of the Board of Directors.
  • Be appointed and removed by the Board of Directors upon the recommendation of the Corporate Governance Committee.
  • Have members that satisfy all applicable independence requirements.
  • Have members that shall be financially literate, as determined by the Board of Directors.
  • Have at least one member of the Committee that shall be an “audit committee financial expert” as determined by the Board in accordance with the Securities and Exchange Commission rules.

Meetings and Procedures
The Audit Committee shall:

  • Meet as often as necessary to enable it to fulfill its responsibilities and duties as set forth herein.
  • Report to the Board any actions taken and a summary of matters discussed at each meeting of the Committee.
  • Keep written minutes of its meetings, which minutes shall be maintained with the books and records of the Company.

Duties and Responsibilities
The Audit Committee will have board authority and powers in fulfilling its purpose and discharging its responsibilities.

Resources
The Audit Committee shall:

  • Maintain free and open communication between the Committee, independent auditor, the internal auditors, and Management of the Company.
  • Be empowered to investigate any matter brought to its attention with full access to all books, records, facilities, and personnel of the Company and have the authority to engage independent counsel and other advisers as it determines necessary to carry out its duties.
  • Receive appropriate funding from the Company, as determined by the Committee, for payment of compensation to any such counsel and advisor.

Independent Auditors
The Independent Auditors shall have sole accountability to the Audit Committee.
In connection with its oversight of the Independent Auditors, the Audit Committee shall:

  • Be directly responsible for the appointment, approving the compensation, retention, and termination of the independent auditor.
  • Review and approve the terms of the engagement of the Independent Auditors, including the scope of their audit, proposed fees and personnel qualifications.
  • Be directly responsible for the oversight of the work of the independent auditor, including resolution of disagreements between Management and the auditor regarding financial reporting.
  • Pre-approve all audit and non-audit services and fees provided by the independent auditor and shall not engage the independent auditor to perform the specific non-audit services proscribed by law or regulation. The Committee may delegate pre-approval authority to the Chairman of the Audit Committee. The decisions of the Chairman of the Audit Committee to whom pre-approval authority is delegated must be presented to the full Audit Committee at its next scheduled meeting.
  • Periodically review information from the Independent Auditors regarding the Independent Auditors' qualifications, independence and performance. At least annually, consider the independence of the Independent Auditors, including whether their performance of permissible non-audit services is compatible with their independence, and (to assess the auditor's independence) receive and review a report by the Independent Auditors describing any relationships between the independent Auditors and the Corporation or any other relationships that may adversely affect the independence of the Independent Auditors.
  • Discuss information regarding qualifications, independence and performance with the Independent Auditors; take appropriate action to determine such qualifications and independence and evaluate their performance.
  • Require the rotation of the lead audit partner of the independent audit firm every five years, with a two-year timeout provision. The Committee shall establish when the five-year limit will be reached for the current lead audit partner. At least one year prior to that time, the Committee shall discuss transition plans for the new lead audit partner. The five-year limit will be reviewed annually with the independent auditors
  • Set clear hiring policies for employees or former employees of the independent auditor that meets the SEC regulations and stock exchange listing standards.
  • Receive and review required communications from the Independent Auditors, including the Independent Auditors' report concerning:
    • critical accounting policies and practices to be used;
    • all alternative treatments of financial information within GAAP for policies and practices related to material items that have been discussed with management, including ramifications of the use of such alternative disclosures and treatments and the treatment preferred by the Independent Auditors, and
    • other material written communications between the Independent Auditors and management, such as any management letter or schedule of unadjusted differences.
  • At least annually, receive and review the Independent Auditors' report on:
    • the Independent Auditors' internal quality control procedures.
    • any material issues raised by the most recent internal quality control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues.

General Auditor, Risk Assessment and Risk Management
The Audit Committee shall from time to time:

  • Discuss with the Vice President, Internal Audit, planned Internal Audit activities, including adequacy of staffing and qualifications of the staff, and the results of Internal Audit activities.
  • Discuss with management, including the Vice President, Internal Audit, the Company's policies regarding risk management and risk assessment.

Controls and Significant Accounting Policies
The Audit Committee shall at least annually:

  • Review with management and the Vice President, Internal Audit the adequacy and effectiveness of the Company's internal controls, financial controls and of disclosure controls and procedures.
  • Review with the Independent Auditors and management the Independent Auditors' Annual Report on Management's Assessment of the Company's Internal Controls.
  • Review with management and the Independent Auditors the Company's significant accounting policies.
  • Review with the Independent Auditors any audit problems, differences or difficulties and management's response.

Filings with Governmental Agencies
The Audit Committee shall:

  • Review with Management and the Independent Auditors the Company's Form 10-K, including the Company's annual audited financial statements and disclosures under Management's Discussion and Analysis of Financial Condition and Results of Operations and recommend for Board approval the inclusion of the financial statements in the Form 10-K for filing with the Securities and Exchange Commission.
  • Discuss with Management and the Independent Auditors the company's quarterly financial statements and disclosures under “Management's Discussion and Analysis of Financial Condition and Results of Operations.”
  • Discuss with Management and the independent auditors the procedures employed to ensure compliance with Sarbanes-Oxley sections 302 and 404, including policies and procedures regarding adequacy of financial reporting and disclosure controls.
  • Prepare and approve the Audit Committee report for the Company's proxy statement.

Press Releases and Earnings Guidance
The Audit Committee shall:

  • Review with management and Independent Auditors the earnings press releases.
  • Periodically discuss with management and Independent Auditors policies regarding earnings releases, financial information and earnings guidance provided to analysts and rating agencies.

Compliance and Legal Matters
The Audit Committee shall:

  • Review with the Company's Vice President, Secretary and Treasurer the Company's Compliance Program.
  • Review with the Company's Vice President, General Counsel material litigation and other legal matters as appropriate.
  • Review at least annually the Company's Code of Conduct to ensure that it is adequate and up to date as it relates to financial responsibility.
  • Establish and review periodically procedures for:
    • receipt, retention and treatment of complaints regarding the Company's accounting, internal accounting controls and auditing matters;
    • employees to submit confidentially and anonymously concerns regarding questionable accounting and auditing matters.

Performance Evaluation and Charter Review
The Audit Committee shall annually:

  • Conduct an annual performance evaluation on the Committee in conjunction with the Nominating and Corporate Governance Committee, the results of which shall be reported to the full Board.
  • Review and reassess its charter in conjunction with the Nominating and Corporate Governance Committee and recommend any proposed changes to the full Board for approval.

EXECUTIVE COMPENSATION AND EMPLOYEE BENEFITS COMMITTEE CHARTER

PURPOSE
The primary function of the Executive Compensation and Employee Benefits Committee ("Compensation Committee") is to assist the Board of Directors in fulfilling its oversight responsibilities regarding.

  • Compensation and benefits of the Company's Chairman of the Board, Chief Executive Officer and other executive officers.
  • Evaluation of the performance of the Chairman of the Board, Chief Executive Officer and other executive officers.
  • Consideration, recommendation, administration and implementation of the Company's incentive-compensation plan and equity-based plans.

MEMBERSHIP
The Committee shall:

  • Be comprised of a minimum of three members of the Board of Directors.
  • Be appointed and removed by the Board of Directors upon the recommendation of the Corporate Governance Committee.
  • Have members that satisfy all applicable independence requirements.

MEETINGS AND PROCEDURES
The Committee shall:

  • Designate one member of the Committee as its chairperson.
  • Meet as often as necessary, but at least twice a year, to enable it to fulfill its responsibilities and duties as set forth herein.
  • In its discretion, have the authority to delegate all or a portion of its duties and responsibilities to a subcommittee of the Committee.
  • Report to the Board any actions taken or matters discussed at each meeting of the Committee.
  • Keep written minutes of its meetings which minutes shall be maintained with the books and records of the Company.


DUTIES AND RESPONSIBILITIES
The Committee shall have the following authority and powers in fulfilling its purpose and discharging its responsibilities.

RESOURCES
The Committee shall have:

  • The power, in its discretion, to retain at the Company's expense to engage independent counsel or any other advisor or expert, as it deems necessary or appropriate to carry out its duties.
  • Appoint counsel, specialists, advisers, agents and other persons, as the Committee deems necessary or advisable in connection with the administration of the Company's Retirement Plan, Employee Stock Purchase Plan and Thrift Plan.
  • Retain and terminate any compensation consultant to be used to assist in the evaluation of Chairman and CEO or other executive officer compensation, including the authority to approve the consultant's fees and other retention terms, and to obtain advice and assistance from internal or outside legal, accounting or other advisors;
  • Access to internal advisors and all other resources within the Company to assist it in carrying out its duties and responsibilities.

COMPENSATION PHILOSOPHY AND PROGRAMS
The Committee shall at least annually:

  • Review and approve the Company's stated compensation philosophy strategy to ensure that management is rewarded appropriately for its contributions to Company growth and profitability
  • Review and approve the structure of the Company's plans for executive compensation, incentive compensation, equity-based compensation and its general compensation plans and employee benefit plans (including retirement and health insurance plans), and recommend to the Board any new plans or any changes in the objectives and structure of the plans

CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER COMPENSATION
The Committee shall at least annually:

  • Review and approve annual and long-term performance criteria, goals and objectives relevant to the compensation of the Company's Chairman of the Board and Chief Executive officer.
  • Evaluate the Chairman and CEO's performance in light of such goals and objectives and establish the compensation level for the Chairman and CEO based on this evaluation.
  • Meet with the Chairman and the CEO to discuss performance and conduct performance appraisals.
  • Review and approve all employment agreements, severance arrangements, change in control agreements or provisions or amendments thereto with the Chairman or CEO.

EXECUTIVE OFFICER COMPENSATION
The Committee shall at least annually:

  • Approve base salaries, cash incentive bonuses, equity-based incentive awards and other compensation for any executive officer of the Company.
  • Review and approve all employment agreements, severance arrangements, change in control agreements or provisions or amendments thereto with any executive officer of the Company.

BENEFIT PLANS
The Committee shall:

  • Consider, recommend, administer and implement the Company's incentive compensation plans and equity-based plans in which directors, the Chairman and the CEO, other executive officers and other employees of the Company and its subsidiaries may be participants.
  • Review and approve the amounts and terms of all individual grants under any incentive compensation plan or equity based plan of the Company.
  • Annually assess the desirability of proposing changes and make recommendations to the Board with respect to any incentive-compensation plans and equity-based plans and any increase in shares reserved for issuance under existing equity plans.
  • Approve the payment of cash performance bonuses to employees, including executive officers.
  • Approve or recommend to the full Board for approval, subject, where appropriate, to submission to stockholders, all new equity-based compensation programs.
  • Periodically review the number, type, and appropriateness of the Company's pension, health, welfare, and benefit plans and shall recommend any changes to the Board.

APPOINTMENT AND MONITORING OF FIDUCIARIES
The Committee shall:

  • Serve as the Administrator of the Company's Retirement Plan, Employee Stock Purchase Plan and Thrift Plan.
  • Carry out appropriate fiduciary responsibilities as defined in each of the Company's Retirement Plan, Employee Stock Purchase Plan and Thrift Plan or other qualified plan document.
  • Review and recommend approval of qualified benefit plan Trustees to the Board.

REPORTS AND AUTHORITY
The Committee shall:

  • Prepare a report on executive compensation for inclusion in the Company's annual meeting proxy statement.
  • Prepare an annual report for presentation to the Board on Chairman of the Board and Chief Executive Officer compensation.
  • Perform such other duties and responsibilities pertaining to compensation matters as may be assigned to the Committee by the Board.

SUCCESSION PLANNING
The Committee shall:

  • Oversee, in conjunction with the Nominating and Corporate Governance Committee, succession planning for senior management of the Company, including consulting on an ongoing basis with the Chairman of the Board, Chief Executive Officer and the Board to remain abreast of management development activities.
  • Review, at least annually, in conjunction with the Nominating and Corporate Governance Committee, the performance and advancement potential of current and future senior management and succession plans for each and review the retention of high-level, high potential succession candidates.
  • Report, at least annually, to the Board on succession planning for senior management of the Company.

PERFORMANCE EVALUATION AND CHARTER REVIEW
The Committee shall at least annually:

  • Review and reassess its Charter in conjunction with the Nominating and Corporate Governance Committee and recommend any proposed changes to the full Board for approval.
  • Conduct an annual performance evaluation of the Committee in conjunction with the Nominating and Corporate Governance Committee, the results of which shall be reported to the full Board.
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE CHARTER

PURPOSE
The primary function of the Nominating and Corporate Governance Committee (the "Governance Committee") is to assist the Board of Directors in fulfilling its oversight responsibilities by:

  • Reviewing and making recommendations to the Board regarding the Board and its committee's composition and structure.
  • Establishing criteria for evaluating Board and committee membership.
  • Evaluating corporate policies relating to the recruitment of Board members.
  • Establishing, implementing and monitoring policies and processes regarding principles of corporate governance applicable to the Company and compliant with applicable requirements.

MEMBERSHIP
The Committee shall:

  • Be comprised of a minimum of three members of the Board of Directors.
  • Be appointed and replaced by the Board of Directors.
  • Have a Chairman of the Committee designated by the Board of Directors from the membership of the Committee.
  • Satisfy all applicable independence requirements of the New York Stock Exchange.
  • Have members that are free from any relationship that, in the opinion of the Board, would interfere with the exercise of his or her independent judgment as a member of the Committee

MEETINGS AND PROCEDURES
The Committee shall:

  • Meet as often as necessary, but at least once each year, to enable it to fulfill its responsibilities and duties as set forth herein.
  • In its discretion, have the authority to delegate all or a portion of its duties and responsibilities to a subcommittee of the Committee.
  • Report to the Board any actions taken or matters discussed at each meeting of the Committee.
  • Keep written minutes of its meetings which minutes shall be maintained with the books and records of the Company.


DUTIES AND RESPONSIBILITIES
The Committee will have broad authority and powers in fulfilling its purpose and discharging its responsibilities.

RESOURCES
The Committee shall have:

  • The sole authority and responsibility to select, evaluate, retain and, where appropriate, terminate any search firm to be used to identify qualified director candidates, including the sole authority to approve such search firm's fees and other retention terms.
  • The power, in its discretion, to retain at the Company's expense such independent counsel and other advisors and experts, as it deems necessary or appropriate to carry out its duties.
  • Access to internal advisors and all other resources within the Company to assist it in carrying out its duties and responsibilities.

BOARD COMPOSITION, NOMINATIONS AND COMMITTEES
The Committee shall:

  • Evaluate the current composition and organization of the Board and its committees in light of requirements established by any regulatory body or any other applicable statute, rule or regulation which the Committee deems relevant and make recommendations regarding the foregoing to the Board for approval.
  • Review the composition and size of the Board in order to ensure that the Board is comprised of members reflecting the proper expertise, skills, attributes and personal and professional backgrounds for service as a director of the Company, as determined by the Committee.
  • Actively seek and evaluate qualified individuals to become new directors, as needed, and develop the Board criteria for selecting new directors, including standards for director independence.
  • Review qualifications of candidates for Board membership recommended by Directors, officers, employees, stockholders and others in accordance with procedures established by the Company's corporate governance guidelines, applicable laws and regulations, the rules of the New York Stock Exchange and the Committee.
  • Evaluate the performance of current Board members proposed for reelection, and make recommendations to the Board regarding members of the Board standing for reelection.
  • Evaluate and, if deemed necessary, recommend the termination of Board membership of any director in accordance with the Code of Conduct.
  • Recommend to the Board matters regarding Board Committees, such as assignment and rotation of Committee members and chairs, and changes to Committee charters.
  • Recommend to the Board a slate of nominees for election to the Board. Director candidates must be designated to represent the holders of Common Stock or the holders of Class A Common Stock in accordance with the Articles of Incorporation and the By-Laws of the Company.

INDEPENDENCE OF DIRECTORS
The Committee shall:

  • Determine the independence of each non-employee director, at least annually, as set forth in the current New York Stock Exchange listing standards, federal laws, regulations and the Company's governance principles.
  • Ensure that the Company has an appropriate policy on potential conflicts of interest including but not limited to, the policies on related-party transactions (including any dealings with directors, officers or employees and such other transactions that could have the appearance of a potential conflict of interest.
  • Monitor and report to the Board whether there is any current relationship between any Director and the Company that made adversely affects the independent judgment of the Director.
  • Review all related party transactions involving executive officers and members of the Board and, as required by any regulatory body, consider approval of such transactions.

DIRECTOR COMPENSATION
The Committee shall:

  • Review the compensation of and benefits for Directors and recommend to the Board all matters pertaining to fees and retainers paid to directors for Board and Committee service and for serving as Chairman of a Board committee, including any awards from the Company's Long-Term Incentive Plans.
  • The Committee shall have sole authority to employ consultants or advisors to evaluate director compensation and to approve consulting fees and other retention terms.

CORPORATE GOVERNANCE MATTERS
The Committee shall:

  • Review and assess, at least annually, the Company's Corporate Governance Polices and recommend to the Board any necessary modifications.
  • Review and assess, at least annually, the Company's Code of Conduct and recommend to the board any necessary modifications.
  • Develop, implement, review and monitor a continuing education program for members of the Board to the extent required by any regulatory body or otherwise deemed advisable by the Committee.
  • Review all stockholder proposals submitted to the Company and the timeliness of the submission thereof and recommend to the Board appropriate action on each such proposal.
  • Establish procedures in which shareholders will be able to communicate in writing with members of the Board of Directors by regular mail.
  • Take such other actions regarding the Company's corporate governance that are in the best interests of the Company and its shareholders as the Committee shall deem appropriate or as shall otherwise be required by any Regulatory Body.

SUCCESSION PLANNING
The Committee shall:

  • Oversee, in conjunction with the Executive Compensation and Employee Benefits Committee, succession planning for senior management of the Company.

PERFORMANCE EVALUATION AND CHARTER REVIEW
The Committee shall at least annually:

  • Review and reassess its Charter and recommend any proposed changes to the full Board for approval.
  • Review and reassess the Company's By-Laws and the charters of any committee of the Board to ensure compliance with any principles of corporate governance and recommend to the Board any necessary modifications.
  • Establish the evaluation criteria and implement the process for the performance evaluation of the Board.
  • Conduct an annual performance evaluation of the Committee, the results of which shall be reported to the full Board.
  • Ensure that the Chairperson of each board committee conducts a performance evaluation of his or her committee, the results of which shall be reported to the full Board.
 
 
  
  
 Close
Please enter the zip code of the delivery address below to determine whether Havertys can deliver this item to your area.