Download Compensation Committee Charter 101.3 KB
- (as amended May 14, 2013)
This Compensation Committee Charter governs the operations of the Compensation Committee (the "Committee") of the Board of Directors (the "Board") of Broadcom Corporation (the "Company"). This Charter is intended as a component of the flexible governance framework within which the Board, assisted by its committees, directs the affairs of the Company. While it should be interpreted in the context of all applicable laws, regulations and listing requirements of the Nasdaq Global Select MarketSM, as well as in the context of the Company's Second Amended and Restated Articles of Incorporation and Bylaws, as the same may be amended or restated from time to time, it is not, subject to any contractual or other commitments of the Company, intended to establish by its own force any legally binding obligations.
- I. PURPOSE
The Committee shall assist the Board in: (i) determining appropriate compensation for the Company's executive officers; (ii) evaluating officer compensation plans, policies and programs; and (iii) overseeing, administering and reviewing compensation, equity and benefit plans and programs for officers and employees.
In addition to the powers and responsibilities expressly delegated to the Committee in this Charter, the Committee may exercise any other powers and carry out any other responsibilities delegated to it by the Board from time to time consistent with the Company's Bylaws and applicable laws and regulations.
In discharging its role, the Committee is empowered to investigate any matter brought to its attention that is within the scope of or otherwise relevant to its responsibilities, with all requisite access to all books, records, facilities and personnel of the Company.
In the absence of their possession of reason to believe that such reliance is unwarranted, the members of the Committee necessarily rely without independent verification on the information or documentation provided to them by, and on the representations made by, the Company's management or other employees of the Company, and/or any consultant or professional retained by the Committee, the Board, management or by any Board committee.
- II. COMMITTEE MEMBERSHIP
The Committee shall consist of two or more members of the Board, each of whom is determined by the Board to be "independent" in accordance with The Nasdaq Stock Market, Inc., Marketplace Rules (except as may be allowed by those rules in exceptional circumstances) and the Company's Corporate Governance Guidelines. No director may serve on the Committee unless he or she (i) is a "Non-employee Director" for purposes of Rule 16b-3 under the Securities Exchange Act of 1934, as amended, and (ii) satisfies the requirements of an "outside director" for purposes of Section 162(m) of the Internal Revenue Code. In addition, Committee members are prohibited from accepting, directly or indirectly, any consulting, advisory or other compensatory fee, other than for Board service, from the Company or any subsidiary.
The members of the Committee shall be appointed by the Board and continue to be members until their successors are elected and qualified or until their earlier resignation or removal from the Committee. Any member of the Committee may be removed, with or without cause, by the Board at any time.
The Board may appoint one member to serve as Chair of the Committee annually, to convene and chair all regular and special sessions of the Committee, set the agendas for Committee meetings and determine and communicate to management the information needs of the Committee, and to report Committee determinations and action on behalf of the Committee to the full Board. If the Board fails to appoint a Chair, the members of the Committee shall annually elect a Chair by majority vote. The Chair of the Committee shall generally not serve as Chair for not more than six consecutive years.
- III. COMMITTEE MEETINGS
The Committee shall have regular meetings on at least a semi-annual basis (or more frequently as circumstances dictate). Meetings of the Committee may be held telephonically. A majority of the members of the Committee shall constitute a quorum sufficient for the taking of any action by the Committee. The Committee shall meet separately, on at least an annual basis, with the Chief Executive Officer (the "CEO"), the vice president of human resources (or similar position) and any other corporate officers as the Board or Committee deem appropriate to discuss and review the performance criteria and compensation levels of the Company's Officers (as defined in Article IV); provided, however, that the CEO shall not be present at such portion of the meeting during which the compensation of the CEO is discussed. The Committee shall have the authority to establish its own rules and procedures for notice and conduct of its meetings as long as they are not inconsistent with any provisions of the Company's Bylaws or applicable laws or regulations.
The Committee may form, and delegate any of its responsibilities to, a subcommittee so long as such subcommittee is constituted in compliance with all applicable laws and regulations.
- IV. OUTSIDE ADVISORS
The Committee is authorized, in its sole discretion, to retain outside counsel or other advisors, and such counsel and/or advisors shall report directly to the Committee or its designee. The Committee shall have the requisite authority to appoint, compensate, terminate and oversee executive compensation consultants and will receive adequate funding from the Company to engage such consultants. The Committee shall have full access to the Company's executives and personnel as appropriate to carry out its responsibilities. The Committee may select a compensation consultant, legal counsel or other adviser to the Committee only after taking into consideration all factors relevant to that person's1 independence from management, including the following:
- The provision of other services to the Company by the person that employs the compensation consultant, legal counsel or other adviser;
- The amount of fees received from the Company by the person that employs the compensation consultant, legal counsel or other adviser, as a percentage of the total revenue of the person that employs the compensation consultant, legal counsel or other adviser;
- The policies and procedures of the person that employs the compensation consultant, legal counsel or other adviser that are designed to prevent conflicts of interest:
- Any business or personal relationship of the compensation consultant, legal counsel or other adviser with a member of the Committee;
- Any stock of the Company owned by the compensation consultant, legal counsel or other adviser; and
- Any business or personal relationship of the compensation consultant, legal counsel, other adviser or the person employing the adviser with an executive officer of the Company.
The Committee shall conduct the independence assessment with respect to any compensation consultant, legal counsel or other adviser that provides advice to the Committee, other than: (i) in-house legal counsel; and (ii) any compensation consultant, legal counsel or other adviser whose role is limited to the following activities for which no disclosure would be required under Item 407(e)(3)(iii) of Regulation S-K: consulting on any broad-based plan that does not discriminate in scope, terms, or operation, in favor of executive officers or directors of the Company, and that is available generally to all salaried employees; or providing information that either is not customized for the Company or that is customized based on parameters that are not developed by the compensation advisor, and about which the compensation advisor does not provide advice.
Nothing herein requires a compensation consultant, legal counsel or other compensation adviser to be independent, only that the Committee consider the enumerated independence factors before selecting or receiving advice from a compensation consultant, legal counsel or other compensation adviser. The Committee may select or receive advice from any compensation consultant, legal counsel or other compensation adviser it prefers, including ones that are not independent, after considering the six independence factors outlined above.
Nothing herein shall be construed: (1) to require the Committee to implement or act consistently with the advice or recommendations of the compensation consultant, legal counsel or other adviser to the Committee; or (2) to affect the ability or obligation of the Committee to exercise its own judgment in fulfillment of its duties.
1For purposes of this Charter "person" shall mean a natural person or a company.
- V. KEY RESPONSIBILITIES
The following functions and responsibilities are set forth as a guide for fulfilling the Committee's purposes, with the understanding that the Committee's activities may diverge as appropriate given the circumstances. The Committee is authorized to carry out these responsibilities, and other responsibilities assigned to it by the Board from time to time, or as may be required by applicable laws or regulations, and to take any actions reasonably related to the mandate of this Charter.
- Establish and review the overall compensation philosophy of the Company.
- Establish and administer the compensation programs applicable to the CEO and the executive elected by the Board (collectively, the "Officers").
- Review and approve goals and objectives relevant to the compensation of the CEO and other Officers, including annual performance objectives.
- At least annually evaluate the CEO's and Officers' performance against those goals and objectives, and determine the compensation forms and levels for each such person based on this evaluation, a consideration of market factors, individual, group and Company performance, the Company's total shareholder return over one or more specified periods on a stand-alone or comparative basis, or both, and such other factors as the Committee deems appropriate. In conducting the evaluation of the CEO, the Committee or its Chair will meet with the independent directors of the full Board to solicit input and to discuss the specific performance of the CEO.
- Review on a periodic basis the Company's Officer compensation programs to determine whether they are properly coordinated and achieving their intended purpose(s) and recommend or implement any appropriate modifications. Obtain such advice, data or other resources necessary to perform the Committee's duties hereunder, including retaining external consultant reports or published surveys, an independent compensation consultant and other professionals to assist in the design, formulation, analysis and implementation of compensation programs for Officers.
- Review and approve new or modifications to the Officers' existing compensation programs, to the extent that the Committee believes the same are appropriate or desirable.
Monitor and evaluate matters relating to the compensation and benefits structure for employees of the Company, other than Officers, as the Committee deems appropriate, including without limitation:
- Monitor and provide guidance to management on significant issues affecting compensation philosophy or policy, as applicable to employees other than Officers; and
- Monitor and provide guidance to management on establishing compensation arrangements for Company employees that do not incentivize unnecessary and excessive risk taking and oversee the assessment of material risks associated with the Company's compensation structure, policies and programs (for all employees generally, including the Officers).
- Review and recommend to the Board for approval, all new incentive equity-based plans or any changes to such equity-based plans; provided, however, that (i) for existing equity-based plans for which the Committee serves as Plan Administrator, the Committee has full authority to award new types of equity awards if provided for by such plans, and (ii) any proposed repricing of options granted prior to November 1, 2004 in which members of the Board are eligible to participate must also be submitted to the Company's shareholders for approval.
- Review, approve and amend all new cash incentive plans.
- Administer and grant stock options or other equity awards to employees pursuant to the Company's equity-based plans.
- Review, approve and administer and monitor compliance by Officers with the rules, policies and guidelines for the Company's compensation programs and equity-based plans, including stock ownership guidelines.
- Review and make recommendations to the Board with respect to shareholder proposals related to compensation matters.
- Review and make recommendations to the Board regarding advisory proposals related to compensation matters.
- Review and approve any and all special cash payments, perquisites, and tax gross ups and other special compensation arrangements for Officers.
- Review and approve compensation packages for new Officers and all separation packages, change in control benefits and severance benefits for Officers.
- Review and recommend to the Board for approval any changes in employee benefit, retirement and defined contribution plans.
- Review and discuss the "Compensation Discussion and Analysis" disclosure prepared pursuant to the requirements of Item 402(b) of Regulation S-K (or any successor disclosure item), and based on such review and discussion recommend whether such "Compensation Discussion and Analysis" should be included in the Company's annual report of Form 10-K, proxy statement, information statement or similar document.
- Prepare the report required by applicable rules and regulations of the SEC and other applicable regulatory bodies for inclusion in the Company's annual proxy statement.
- Report to the Board on Committee recommendations and any other matters the Committee deems appropriate or the Board requests.
- Maintain minutes or other records of Committee meetings and activities.
- Conduct an annual self-evaluation of the performance of the Committee and its members including their effectiveness and compliance with this Charter.
- Review and reassess the adequacy of this Charter at least annually.