Compensation Committee Charter
(As Amended and Approved March 12, 2015)
Purpose and Authority
The purpose of the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of InfoSonics Corporation (the “Company”) is to (a) oversee the Company’s compensation plans, policies and programs for its senior management and non-employee directors of the Board, (b) oversee the Company’s employee benefit plans, including its incentive compensation and equity compensation plans, and (c) review, discuss with Company management, make recommendations regarding and approve, as applicable, compensation-related disclosures as may be required by the Securities and Exchange Commission (“SEC”) or other applicable regulatory bodies, including any compensation discussion and analysis (“CD&A”), if required by the Securities Exchange Act of 1934, as amended (the “Exchange Act”), to be included in Company SEC filings.
The Committee shall have all authority necessary to fulfill the duties and responsibilities assigned to the Committee in this Charter or otherwise assigned to it by the Board. To the extent permitted by applicable law, regulations and listing requirements, as the Committee deems appropriate, it may form and delegate authority to subcommittees and may delegate authority to one or more designated members of the Committee. The Committee may delegate to one or more senior executive officers the authority to make grants of equity-based compensation to eligible individuals who are not executive officers of the Company, subject to compliance with applicable laws. The Committee may revoke any delegation of authority at any time.
The Committee will from time to time work with the Company’s human resources professionals in discharging its duties. The Committee shall have the sole authority to retain and terminate, or receive advice from, outside counsel, compensation consultants, or other advisors, as it deems appropriate, to assist the Committee in carrying out its duties without seeking Board approval with respect to the selection, fees or terms of engagement of any such advisors. The Committee may retain, or receive advice from, such outside counsel, compensation consultants, or other advisors only after considering the factors specified in Exchange Act Rule 10C-1. The Committee may retain, or receive advice from, any compensation advisor they prefer, including ones that are not independent, after considering the specified factors. The Committee is not required to assess the independence of any compensation consultant or other advisor that acts in a role limited to (i) consulting on any broad-based plan that does not discriminate in scope, terms or operation in favor of executive officers or directors and that is generally available to all salaried employees or (ii) providing information that is not customized for a particular company or that is customized based on parameters that are not developed by the consultant or advisor, and about which the consultant or advisor does not provide advice. The Company will provide the appropriate funding, as the Committee determines, for the payment of compensation to the Committee’s independent counsel and other advisors and for administrative expenses, deemed necessary or appropriate by the Committee in carrying out its duties.
The Committee shall be composed of at least three directors, each of whom shall, as determined by the Board, (a) meet the independence standards established by the Board and applicable laws, regulations and listing requirements applicable to the Company from time to time, (b) be a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, and (c) be an “outside director” within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”).
Appointment and Removal of Members
The members of the Committee shall be appointed by the Board. The Board may remove any member from the Committee at any time with or without cause.
The Committee shall review, evaluate and make recommendations, as applicable, to the Board regarding the Company’s executive compensation philosophy and the objectives of the Company’s executive compensation programs.
Duties and Responsibilities
The Committee shall have the following duties and responsibilities, in addition to any duties and responsibilities assigned to the Committee from time to time by the Board:
- Review at least annually the Company’s overall compensation philosophy and related compensation and benefit policies, programs and practices to (a) ensure that they support the Company’s business objectives and comply with applicable laws and regulations and (b) evaluate whether the Company’s incentive compensation programs contain incentives for executive officers and employees to take risks in performing their duties that are reasonably likely to have a material adverse effect on the Company.
- Review and approve goals and objectives relevant to the compensation of the Chief Executive Officer (“CEO”), evaluate the CEO’s performance in light of those goals and objectives, and set the CEO’s compensation level (including, but not limited to, annual base salary, long- and short-term incentive compensation, retirement plans, deferred compensation plans, equity compensation plans and change-in-control or other severance plans, as the Committee deems appropriate), based on this evaluation. In reviewing and approving such matters, the Committee shall consider such matters as it deems appropriate, including the Company’s financial and operating performance, the alignment of the interests of the executive officers and the Company’s stockholders, the performance of the Company’s common stock and the Company’s ability to attract and retain qualified individuals. The CEO may not be present during voting or deliberations concerning his or her compensation.
- Evaluate annually the assessment by the CEO of the other executive officers of the Company in light of the goals and objectives of the Company’s executive compensation program, and approve, each such executive officer’s compensation level (including, but not limited to, annual base salary, long- and short-term incentive compensation, retirement plans, deferred compensation plans, equity compensation plans and change-in-control or other severance plans, as the Committee deems appropriate), based on this evaluation.
- Review and approve, if appropriate, or recommend to the Board for approval:
(a) compensation arrangements to be made between the Company and any newly hired or promoted executive officer,
(b) any new or amended employment, severance, termination or change of control agreement or arrangement between the Company and any executive officer, and
(c) any other special executive employment, compensation or retirement arrangements.
- Perform such duties and responsibilities as may be assigned to the Committee under the terms of any of the Company’s executive compensation programs.
Incentive Compensation Plans and Benefit Programs
- Review and approve, if appropriate, or recommend to the Board for approval incentive compensation plans and benefits programs, including those covering senior management. Amend or terminate any such plan or program to the extent the Committee deems appropriate, provided that Board approval shall be obtained (following applicable Committee review and recommendation) to the extent such termination or amendment requires stockholder approval or Board approval is otherwise required under the terms of the plan or program or by applicable law or regulation.
- Perform such duties and responsibilities, including acting as plan administrator and reviewing applicable goals and objectives, as may be assigned to the Committee under the terms of any compensation plan or other benefit program, including any incentive compensation or equity-based plan.
- Make and approve stock option grants and other equity awards to persons who are Board members or executive officers of the Company.
Non-Employee Director Compensation
- Oversee and annually review the non-employee director compensation program, including all forms of cash compensation paid to non-employee directors and the grant of all forms of stock compensation provided to such directors. Recommend to the Board any adjustments to director compensation. No member of the Committee will act to fix his or her own compensation, except for compensation to directors for their service as a director.
- Review, discuss with management and make recommendations regarding compensation-related disclosures, as applicable, as may be required by the SEC or other applicable regulatory bodies, including the Company’s annual Compensation Committee Report to be included in SEC filings and the Company’s CD&A, if required.
- Approve the Company’s annual Compensation Committee Report to be included in SEC filings and the Company’s CD&A, if required.
- Monitor compliance with the laws, rules and regulations governing executive compensation, including Section 16 of the Exchange Act, stockholder approval of certain executive compensation matters, and the Company’s policies on structuring compensation programs to preserve tax deductibility under Section 162(m) of the Code, as each may be amended from time.
The Committee shall meet as often as necessary to fulfill the responsibilities set forth in this Charter. In the absence of a member designated by the Board to serve as chair of the Committee, the members of the Committee may appoint from among their number a person to preside at their meetings.
The Committee shall provide minutes of Committee meetings to the Board and report regularly to the Board on its activities.
The Committee shall annually review and reassess the adequacy of this Charter, including the Committee’s structure, processes, and membership requirements, and, if appropriate, propose changes to the Board.
The Committee shall obtain or perform an annual evaluation of the Committee’s performance and make applicable recommendations for improvement.