Compensation, Governance and Nominating Committee Charter
Revised November 15, 2007
The purpose of the Compensation, Governance and Nominating Committee (the "Committee") is: (i) to carry out the Board of Directors' responsibility relating to compensation of the Company's executives; (ii) to develop and recommend to the Board corporate governance guidelines for the Company; (iii) to assist the Board in identifying qualified individuals to become board members; and (iv) to recommend to the Board the director nominees for the next annual meeting of shareowners.
Membership
The Committee shall consist of at least two members, all of whom shall be "independent directors" as that term is used in the listing standards of the New York Stock Exchange. Additionally, no director may serve 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, as amended. The Vice President-Human Resources and Services of PPL Services Corporation shall be the Staff Liaison assigned to the Committee.
Meetings
The Committee shall hold annually three regular meetings, normally in January, July and November. In addition, the Committee shall hold such other meetings at such times and places as it may deem appropriate or necessary.
Principal Functions
The principal functions of the Committee are:
|
Compensation |
|
1. |
To review and approve annually the compensation structure, including goals and objectives, of the chief executive officer. The Committee shall evaluate at least annually the performance and leadership of the chief executive officer in light of these established goals and objectives. Based on these evaluations, the Committee shall determine and approve the chief executive officer's annual compensation, including salary, incentive compensation and other remuneration. |
|
2. |
To review and approve annually the compensation structure, including goals and objectives, for the Company's executive officers who are subject to Section 16 of the Securities Exchange Act of 1934, as amended. The Committee shall review with the chief executive officer his or her evaluation of the performance and leadership of such executive officers and shall approve the annual compensation, including salary, incentive compensation and other remuneration of such executive officers. |
|
3. |
To review at least annually the goal achievements of each individual executive officer eligible to receive awards under the incentive compensation program and to make appropriate incentive compensation awards pursuant to that program. |
|
4. |
To review the Company's incentive compensation plans and programs, including all equity-based plans and recommend such changes to the Board as appropriate. |
|
5. |
To review and discuss the annual Compensation Discussion and Analysis and recommend whether it should be included in the Company's annual report on Form 10-K and proxy statement, as well as review and approve a Compensation Committee Report to be included or incorporated by reference into the Company's annual report on Form 10-K. |
|
6. |
To review the amount and the basis of fees and other compensation paid to outside directors and to recommend changes in such compensation whenever advisable. |
|
7. |
To monitor and make changes to director compensation plans, including stock plans, whenever advisable. |
|
Corporate Governance |
|
8. |
To review periodically, but not less than annually, with the chairman and chief executive officer the plan of succession for the chief executive officer and other senior officers and to review the process within the Company to identify potential senior managers of the Company and its subsidiaries. |
|
9. |
To establish and administer programs for evaluating the performance of the Board and its committees. |
|
10. |
To review the Board retirement policies applicable to members. |
|
11. |
To develop and recommend to the Board for its approval corporate governance guidelines. The Committee shall review the guidelines, at least annually, and recommend changes as necessary. |
|
12. |
To review and approve all requests for indemnification by officers of the Company who are members of the Company’s Corporate Leadership Council. |
|
13. |
To report highlights of the Committee's activities to the Board of Directors on a regular basis. |
|
Nominations |
|
14. |
To develop and review criteria for the qualifications of potential and incumbent members of the Board and methods of recommendation of candidates to the Board of Directors, to identify and evaluate candidates for consideration as members of the Board, including incumbent directors whose terms are expiring, and to make such recommendations as it deems appropriate for director nominees for the next annual meeting of shareowners and in the event a vacancy in the Board occurs or the number of directors is increased. |
The Committee shall have the sole authority to: (i) retain and terminate such compensation consultants it deems appropriate to assist in the evaluation of director, chief executive officer or senior executive compensation, and (ii) retain and terminate such search firms it deems appropriate to identify director candidates. The Committee shall have the sole authority to approve related fees and other retention terms of such consultants and firms.
Review of Committee Function and Charter
The Committee shall ensure that there is an annual performance evaluation of the Committee. Also, the Committee shall review and reassess the adequacy of this Charter on an annual basis and recommend any changes to the Board of Directors.