Compensation Committee Charter
Purpose
The Compensation Committee is appointed by the Board of Directors of Houston Wire & Cable Company (the "Company") to discharge the Board's responsibilities relating to evaluation and compensation of the Company's executive officers. This Charter specifies the scope of authority and responsibilities of the Committee.
Committee Membership
The Committee will consist of at least three directors, all of whom, subject to any applicable phase-in rule, meet the independence requirements contained in the NASDAQ listing standards, as determined by the Board. All Committee members shall also be "non-employee directors" as defined by Rule 16b-3 under the Securities Exchange Act of 1934, and at least two members shall be "outside directors" as defined by Section 162(m) of the Internal Revenue Code. The Board will appoint the Committee members annually. Members may be removed by the Board at any time in its discretion, but shall otherwise serve until a successor has been named. The Chair will be appointed by the Committee and may be removed by the Committee in its discretion. No director shall serve as a member of the Committee if such director has been or is currently a part of an interlocking directorate in which the Chief Executive Officer (CEO) or another executive officer of the Company serves on the compensation committee of another company that employs such director. The Committee shall have the authority to delegate any of its responsibilities to subcommittees as the Committee may deem appropriate, provided the subcommittees are composed entirely of independent directors.
Meetings
The Committee shall meet as often as its members deem necessary to perform the Committee's duties and responsibilities.
Committee Authority and Responsibilities
The Committee will have the authority, to the extent it deems necessary or appropriate, to retain a compensation consultant to assist in the evaluation of CEO or executive officer compensation. The Committee shall have authority to retain and terminate any such consulting firm, including authority to approve the firm's fees and other retention terms. The Committee shall also have authority, to the extent it deems necessary or appropriate, to retain other advisors. The Company will provide for appropriate funding, as determined by the Committee, for payment of compensation to any consulting firm or other advisors employed by the Committee.
The Committee will make regular reports to the Board and will propose any necessary action to the Board. The Committee will review and reassess the adequacy of this charter annually and recommend any proposed changes to the Board for approval.
The committee will:
- Make recommendations to the Board with respect to the CEO's compensation level.
- Consider the Company's performance and relative shareholder return, the value of similar incentive awards to CEOs at comparable companies, and the awards given to the Company's CEO in past years when determining the long-term component of the CEO's compensation.
- Review the CEO's recommendations on compensation of the executive officers of the Company and make recommendations to the Board with respect thereto and with respect to the Company's major compensation policies and practices. The Committee shall report its recommendations to the full Board for approval and authorization.
- and review the Houston Wire & Cable Company 2006 Stock Plan, including approving the number and distribution of options under such plan.
- Produce an annual report on executive compensation for inclusion in the proxy statement as the Compensation Committee Report.
The CEO may not be present during any deliberations on his or her compensation.
