Governance and Nominating Committee Charter
The Governance & Nominating Committee (“Committee”) of Alteva (“Company”) is appointed by the Board of Directors (“Board”) to:
1. Assist the Board by identifying individuals qualified to become Board members, and to recommend to the Board the director nominees for the next annual meeting of shareholders;
2. Assist the Board in establishing and implementing an effective corporate governance policy and recommend to the Board the Principles of Corporate Governance applicable to the Company;
3. Recommend appropriate Committee Charters;
4. Lead the Board in its annual review of the Board’s performance; and
5. Recommend to the Board director nominees for each committee including each committee chairman.
The Committee will be comprised of a minimum of three (3) and a maximum of five (5) independent members of the Board pursuant to the stock exchange listing standards where the Company’s stock is traded or any standards that law or regulation may require or that the Board shall determine apply.
The members of the Committee shall be designated and approved by a majority of the whole Board. The Committee shall recommend, and the Board shall designate, one member of the committee to serve as Chairperson. The members of the Committee shall serve until their resignation, retirement, or removal by the Board or until their successors are appointed. No member of the Committee shall be removed by the Board except by the majority vote of the independent directors of the whole Board then in office.
RESPONSIBILITIES AND AUTHORITY:
1. Recommend to the Board for adoption Principles of Corporate Governance for the Company, and periodically review and make recommendations to the Board regarding those guidelines;
2. Review and make recommendations to the Board regarding the composition, organization and processes of the Board, including policies with respect to the size of the Board, the types, functions and size of Board committees, the appointment of members, chairmen and vice chairmen of Board committees and the committee rotation schedule;
3. Recommend criteria and qualifications for the selection of directors, assist in identifying individuals qualified to become Board members as vacancies occur, evaluate potential director candidates, and recommend to the Board a slate of director nominees to be submitted to the shareholders at each annual meeting;
4. Retain and terminate the services of any search firms used to identify director candidates and have sole authority to approve the search firm’s fees and other retention terms. The Committee shall also have authority to obtain advice and assistance from internal or external legal, accounting or other advisors;
5. Review, at least annually, the independence of the members of the Board and committees; review any potential conflicts of interest of current or prospective directors, recommend appropriate action to the Board concerning such conflicts;
6. Consider and recommend Board action with respect to offers of resignation submitted by directors and removal of directors;
7. Consider and recommend to the Board candidates for successor to the Chief Executive Officer of the Company when the need arises;
8. Review the President’s recommended policies and procedures to ensure accurate and timely reporting of information to be filed with the SEC, the stock exchange where the Company’s stock is traded, and any other applicable regulatory body;
9. Review and recommend to the Board guidelines and procedures to be used by directors in evaluating the performance of the overall Board and oversee the performance review process;
10. Complete an annual performance evaluation of the Nominating and Governance Committee; review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval;
11. Review and discuss with the Board the succession plan for the President, Officers and Senior Management of the Company;
12. Recommend continuing education requirement of Board Members;
13. Report to the Board concerning all actions taken by the Committee; and
14. Such other responsibilities as may be assigned to the Committee from time to time by resolution of the Board.
An expanded description of the Committee’s Duties and Responsibilities is provided in Exhibit A.
MEETINGS AND PROCEDURES
- The Committee shall fix its own rules of procedure, which shall be consistent with the Bylaws and this Charter.
- The Committee shall meet as often as it deems necessary or appropriate, but no less than twice per year. A majority of committee members shall constitute a quorum.
- The Chairperson of the Committee or a majority of the members of the Committee may call a special meeting of the Committee.
- The Committee shall keep written minutes of its meetings, which minutes shall be maintained with the books and records of the Company.
- The Committee shall report to the Board on the matters discussed at each meeting of the Committee, including describing all actions taken by the Committee at the meeting.
- The Committee may delegate authority to one or more of its members where appropriate, but not if the authority is required by law, regulation, or standard of the Stock Exchange where the Company’s stock is traded to be exercised by the Committee as a whole.
- The Committee may request that any directors, officers, or employees of the Company, or other persons whose advice and counsel are sought by the Committee, attend any meeting to provide such information as the Committee requests.
Expanded Description of the Duties and Responsibilities of the Nominating and Governance Committee
1.The Committee’s recommendation and evaluation of potential directors shall consider that the Board as a whole should have competency in these areas:
- Industry knowledge
- Accounting and finance
- Business judgment
- Mergers and acquisitions
- Business strategy
- Crisis management
- Corporate governance
- Risk management
The Board also seeks members from diverse backgrounds to provide a broad spectrum of experience and expertise and with a reputation for integrity. Directors should have experience in positions with a high degree of responsibility, be leaders in the companies or institutions with which they are affiliated, and have the potential to make significant contributions to the Company.
2. The annual evaluation of the Board and its Committees shall consider Exhibit B.
3. The Committee’s evaluation of its own performance shall consider at least:
- The adequacy, appropriateness, and quality of information and recommendations presented to the Committee;
- The manner in which these were discussed;
- Whether the number and length of the Committee’s meetings were adequate for the Committee to complete its work in a thorough and thoughtful manner.
4. Recommend general matters for consideration by the Board:
- The structure of Board meetings, and recommendations for improvement
- Director retirement policies;
- D&O insurance recommendations;
- Policies limiting the number of boards on which a director or senior executive may serve.
5. Oversee the establishment of the Board’s policies and procedures for stockholder communications with the Board as described in Exhibit C.
Criteria for the Evaluation of the Board of Directors and its Committees
1. Representation of Stockholders. Clearly recognizes the role of directors to represent the interests of the Company and its stockholders. Understands the difference between the function of the Board (or Committee) and that of Company management.
2. Judgment and Knowledge. Demonstrates judgment and knowledge in the ability to assess Company strategy, business plans, management evaluation, and other key issues. Demonstrates competency in the areas cited in Exhibit A, item 1, as applicable.
3. Meaningful Participation. Manifests confidence and willingness to express ideas and engage in constructive discussion. Actively participates in decision-making and is willing to make tough decisions. Members demonstrate diligence and faithfulness in attending Board and Committee meetings.
4. Communications. Communication flows freely within the Board (or Committee) and with Company management. Serves as a good sounding board for the CEO. Willing to challenge itself and the CEO. Asks insightful questions and raises thought-provoking perspectives. Willing to hold management accountable for performance and results. Mindful to not get overly involved in operational details and the management process. Evidences characteristics of a team that works well while not always agreeing. Listens with an open mind.
5. Suitability. Fulfills legal and fiduciary responsibilities. Cooperates with management and Company employees, when applicable, regarding requests for information in completing public filings or responding to regulatory inquiries. Makes appropriate time commitments for the Board (or Committee) service. Demonstrates no conflicts of interest. Satisfies applicable requirements for “independence” as set forth in the Company’s Corporate Governance Guidelines.
6. Expertise. Each member makes his or her individual expertise available to the Board (or Committee). The Board (or Committee) as a whole draws on its relevant experience in addressing issues facing the Company. Willing to respond to appropriate requests of CEO outside of Board (or Committee) meetings for advice and support.
7. Vision and Leadership. Understands Company philosophy and strategy. Oriented toward the future and sensitive to future direction of industry. Understands the Company’s short and long term goals and objectives. Understands the Company’s business and its competitors. Supports the Company’s mission and values and is open, honest and direct. Evidences ability to think through who the management of the Company should consist of and what they should do.
8. Professional Status. Members maintain standing and reputation in the business, professional, and social communities in which such members operate. Appropriately represents the Company in all such communities.
9. Participation. Each member must be willing to regularly attend regular and special meetings of the Board, committee meetings and the annual meeting of the shareholders. Board members must also be willing to participate in professional development programs as deemed appropriate.
Communications with the Governance & Nominating Committee
The Governance & Nominating committee maintains a pool of potential nominees (candidates) for director for consideration when vacancies occur on the Board.
Potential candidates for director include nominees recommended by shareholders qualified to do so by regulation or by the advance notice provisions in the Company’s by-laws. Qualified shareholders may contact the Committee Chairman, the Chairman of the Board or the Corporate Secretary in writing when proposing a nominee. Correspondence should include a detailed description of the candidate’s qualifications and the method to contact that candidate if the Committee chooses to do so. Names and qualifications of all candidates will be forwarded to the Committee Chairman for consideration.