Compensation Committee Charter
The Compensation Committee (the “Committee”) is appointed by the Board of Directors (the “Board”) of Insperity, Inc. (the “Company”) to (1) oversee and administer the Company’s compensation policies, plans and practices with respect to all officers of the Company subject to Section 16 of the Securities Exchange Act of 1934, as amended (the “Executive Officers”); (2) to prepare the report on executive compensation required by the rules of the Securities and Exchange Commission (“SEC”) for inclusion in the Company’s annual report or proxy statement for the annual meeting of stockholders; (3) review and discuss with the Company’s management the Compensation Discussion and Analysis required by the rules of the SEC; and (4) administer the Company’s long-term incentive and equity-based compensation plans for employees.
Membership and Meetings
The Committee shall consist of a number of directors fixed from time to time by the Board, not less than two. The members of the Committee shall be appointed by the Board in its discretion upon the recommendation of the Nominating and Corporate Governance Committee, and shall serve for such term as the Board determines or until their successors are elected or appointed. The members of the Committee shall meet the independence requirements of The New York Stock Exchange listing standards. In addition, it is expected that each member shall be a “non-employee director” within the meaning of Rule 16b-3 promulgated under the Securities Exchange Act of 1934. Committee members may be removed by a majority vote of the Board in its discretion. The Committee shall meet as often as its members shall determine to be necessary, or as meetings may be called by the Chair of the Committee, any two members of the Committee or the Chairman of the Board, but in any event shall meet at least three times each year. The Committee may invite members of management or others to attend meetings and/or to furnish pertinent information. The Committee shall also meet in executive session as it determines is advisable or required. The Board shall appoint one member of the Committee as Chair. The Chair of the Committee shall be responsible for scheduling all meetings of the Committee, determining the agenda for each meeting (following consultation with other members of the Committee and with management), presiding over meetings of the Committee and coordinating reporting to the Board. In the absence of the Chair, the majority of the members of the Committee present at a meeting shall appoint a member to preside at the meeting. A majority of the Committee members will constitute a quorum for the transaction of business by the Committee and the vote of a majority of the members of the Committee so voting will constitute an act of the Committee.
The Committee shall make regular reports to the Board, and all actions of the Committee shall be reported to the Board at the next regular meeting of the Board.
The Committee may form and delegate authority to subcommittees as it deems appropriate.
Duties and Responsibilities
The Committee shall:
- Establish a compensation policy that is designed to attract and retain Executive Officers responsible for the success of the Company and motivate them to enhance long- term stockholder value.
- Establish bonus, long-term incentive and equity-based compensation policies and other forms of compensation or benefits for Executive Officers of the Company.
Executive Officer and Board Compensation
- Annually review and approve the corporate goals and objectives relevant to compensation of the Executive Officers of the Company.
- In light of these goals and objectives, annually evaluate the performance of the chief executive officer and, either as a Committee or together with the other independent directors (as directed by the Board), determine and approve the chief executive officer’s compensation. With regard to the other Executive Officers, annually determine and approve their compensation taking into consideration the factors deemed relevant by the Committee, which may include the recommendations of the chief executive officer. For the purposes of this Charter, “compensation” shall include: (a) annual base salary, (b) bonus, (c) long-term incentive compensation, (d) equity-based compensation, (e) compensation pursuant to an employment agreement and extensions thereto, severance arrangements and change in control agreements or provisions, (f) any special or supplemental benefits, including management perquisites, and (g) all other forms of compensation.
- In determining the long-term incentive component of the compensation of the chief executive officer, the Committee should consider the Company’s performance and relative shareholder return, the value of similar incentive awards to chief executive officers at comparable companies, the awards given to the chief executive officer in past years and any other factors it deems relevant.
- Periodically review and make recommendations to the Board with respect to the compensation and benefits of non-employee directors of the Company, including incentive compensation plans and equity-based plans.
- Establish and periodically review policies in the area of management perquisites.
Long-Term Incentive and Equity-Based Compensation Plans
- Review and approve, and where Board or stockholder approval is required, recommend to the Board, all long-term incentive and equity-based compensation plans of the Company.
- Review and determine the awards for Executive Officers and other employees eligible to participate in the Company’s long-term incentive and equity-based compensation plans, except to the extent the Board delegates responsibility for the review and determination of awards for employees other than Executive Officers to the chief executive officer or another committee established by the Board.
Other Compensation and Employee Benefit Plans
- Review new executive compensation programs; review on a periodic basis the operation of the Company’s executive compensation programs to determine whether they are properly coordinated; establish and periodically review policies for the administration of executive compensation programs; and take steps to modify any executive compensation programs that yield payments and benefits that are not reasonably related to executive performance.
- Monitor compliance with stock ownership guidelines.
- Recommend to the Board any policies or revisions thereto which would allow the Company to recoup compensation paid to employees (“Clawback Policy”) and monitor, oversee and enforce any Clawback Policy approved by the Board.
- Prepare and approve the compensation committee report as required by the SEC to be included in the Company’s proxy statement for the annual meeting.
- Review and discuss with the Company’s management the Compensation Discussion and Analysis required by the rules of the SEC. Based on such review and discussion, the Committee shall determine whether to recommend to the Board that the Compensation Discussion and Analysis be included in the Company’s proxy statement for the annual meeting.
- Annually review the Company’s assessment of its compensation programs and practices and whether such programs and practices create risks that are reasonably likely to have a material adverse effect on the Company.
- Perform such duties as may, from time to time, be delegated to the Committee under the compensation and benefit plans of the Company or its subsidiaries.
- Advise the Board on proposals to stockholders on executive compensation matters, including advisory votes on executive compensation and frequency of such votes, and proposals received from stockholders on executive compensation matters; review the results of such votes; and consider any implications in connection with the Committee’s ongoing determinations and recommendations regarding the Company’s executive compensation policies and practice.
- Exercise such other duties and responsibilities as may be assigned by the Board from time to time.
In exercising its authority, duties and responsibilities under this Charter, the Committee shall have and may exercise all the powers and authority of the Board. The Committee shall have the authority, in its sole discretion, to retain and terminate any compensation consultant, independent legal counsel or other advisor as necessary or appropriate to carry out its duties hereunder and the sole authority to approve such consultant’s, counsel’s or other advisor’s fees and other retention terms. Prior to selecting a compensation consultant, legal counsel or other adviser to the Committee, the Committee shall conduct an assessment of such person’s independence from management, taking into account the factors set forth in Section 303A.05(c) of the New York Stock Exchange listing standards. The Committee shall be directly responsible for the oversight of the work of any compensation consultant, independent legal counsel or other adviser retained by it. The Company shall provide for appropriate funding, as determined by the Committee, for payment of reasonable compensation to a compensation consultant, independent legal counsel or any other adviser retained by the Committee. To the extent the Committee deems necessary or appropriate, the Committee shall be assisted by the Company’s human resources, legal and accounting staff and may additionally obtain assistance from such other persons, who need not be employees of the Company, or organizations, with the expenses incurred in their use to be paid by the Company. The foregoing authority includes the authority to retain, terminate and obtain advice and assistance from external legal, accounting or other advisors and consultants.
Annual Review of Charter and Performance
At least annually, the Committee shall review and reassess the adequacy of this Charter. The Committee shall report the results of the review to the Board, and, if necessary, recommend that the Board amend this Charter. The Committee shall annually review its own performance.
As approved by the Board of Directors on May 24, 2018.