The Board
of Directors (the “Board”) of Particle Drilling
Technologies, Inc. (the “Company”) has established
the Nominating and Corporate Governance Committee
(the “Committee”) with the authority,
responsibilities and specific duties as described in
this Charter.
Purpose
The
purposes of the Committee are to:
1.
Assist the
Board by identifying individuals qualified to become
Board members and recommend director nominees to the
Board for election at the annual meeting of shareholders
or for appointment to fill vacancies;
2.
Recommend
director nominees to the Board for each committee of the
Board;
3.
Advise the
Board about the appropriate composition of the Board and
its committees;
4.
Direct all
matters relating to succession of the Chief Executive
Officer of the Company;
5.
Advise the
Board about and recommend to the Board appropriate
corporate governance practices and assist the Board in
implementing those practices;
6.
Lead the
Board in the annual review of the performance of the
Board and its committees; and
7.
Perform
such other functions as the Board may assign to the
Committee from time to time.
Committee
Membership
The
Committee shall consist of no fewer than two members,
all of whom shall be members of the Board. One of the
Committee members shall serve as the chairperson
(the “Chair”) of the Committee. Each member of the
Committee shall satisfy the independence requirements of
applicable federal law.
The Board
shall annually appoint the members of the Committee, and
the Committee members shall serve until the annual
meeting of the Board following the next annual meeting
of the shareholders of the Company. The Board may
replace Committee members. The Board shall designate the
Chair of the Committee or, if no such designation is
made, the Chair shall be selected by the affirmative
vote of the majority of the Committee.
Committee
Authority and Responsibilities
The
Committee is delegated all the authority of the Board as
may be required or advisable to fulfill the purposes of
the Committee. The Committee may form and delegate
authority to subcommittees when appropriate. Without
limiting the generality of the preceding statements, the
Committee shall have authority, and is entrusted with
the responsibility, to take the following actions:
1.
The
Committee shall establish criteria for selecting new
directors and actively seek individuals qualified to
become board members for recommendation to the Board.
New directors should possess personal and professional
integrity, have good business judgment, and have
relevant experience and skills.
2.
The
Committee shall seek to implement the “independence”
standards required by law, or the Company’s
charter or by-laws.
3.
The
Committee shall determine whether or not each director
and each prospective director of the Company is
independent, disinterested, or a non-employee director
under the standards applicable to the committees on
which such director is serving or may serve. The
Committee may survey any and all of the directors and
prospective directors to determine any matter or
circumstance that would cause the person not to qualify
as an independent, disinterested or non-employee
director under applicable standards, and the Committee
shall report to the Board the existence of any such
matter or circumstance.
4.
The
Committee shall review the advisability or need for any
changes in the number and composition of the
Board.
5.
The
Committee shall review the advisability or need for any
changes in the number, charters or titles of committees
of the Board.
6.
The
Committee shall recommend to the Board the composition
of each committee of the Board and the individual
director to serve as Chair of each committee.
7.
The
Committee shall identify, and periodically update, the
qualities and characteristics necessary for an effective
Chief Executive Officer and monitor and review the
development and progression of potential candidates
against these standards.
8.
The
Committee shall consult with the Chief Executive Officer
on senior management succession planning.
9.
Every three
years, the Committee shall review each director’s
continuation on the Board.
10.
The
Committee shall have the sole authority to retain and
terminate any search firm to be used to identify
director candidates and shall 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, without consulting or
obtaining the approval of any officer of the Company in
advance.
11.
The
Committee shall receive comments from all directors and
report annually to the Board with an assessment of the
Board’s performance, to be discussed with the full Board
following the end of each fiscal year.
12.
The
Committee shall annually request that the Chair of each
committee report to the Board about the committee’s
annual evaluation of its performance and evaluation of
its charter.
13.
The
Committee shall review management’s monitoring of the
Company’s compliance programs and Code of Business
Conduct and Ethics, including a report of violations and
waivers of such code approved by management.
14.
The
Committee shall have authority to obtain advice from
internal or external legal, accounting or other
advisors, without consulting or obtaining the approval
of any officer of the Company in advance.
Procedures
1.
Meetings.
The
Committee shall meet at the call of its Chair, two or
more members of the Committee, or the Chairman of the
Board. Meetings may, at the discretion of the Committee,
include members of the Company’s management, independent
consultants, and such other persons as the Committee or
its Chair may determine. The Committee may meet in
person, by telephone conference call, or in any other
manner in which the Board is permitted to meet under law
or the Company’s bylaws.
2.
Quorum and
Approval. A majority
of the members of the Committee shall constitute a
quorum. The Committee shall act on the affirmative vote
of a majority of members present at a meeting at which a
quorum is present. The Committee may also act by
unanimous written consent in lieu of a
meeting.
3.
Rules.
The
Committee may determine additional rules and procedures,
including designation of a Chair pro tempore in
the absence of the Chair, at any meeting
thereof.
4.
Reports.
The
Committee shall make regular reports to the Board,
directly or through the Chair.
5.
Review of
Charter. Each year,
the Committee shall review and reassess the adequacy of
this Charter and recommend any proposed changes to the
Board for approval.
6.
Performance
Review. Each year,
the Committee shall review and evaluate its own
performance and shall submit itself to the review and
evaluation of the Board.
7.
Fees.
Each member
of the Committee shall be paid the fee set by the Board
for his or her services as a member of, or Chair of, the
Committee.
