ICU MEDICAL, INC.
AS AMENDED AND RESTATED
BY THE BOARD OF DIRECTORS ON APRIL 12, 2013
The purpose of the Compensation Committee (the "Committee") of ICU Medical, Inc. (the "Company") is to discharge the responsibilities of the Board of Directors (the "Board") relating to executive and director compensation, to oversee incentive, equity-based and other compensatory plans in which executive officers and key employees of the Company participate, to produce an annual report on executive compensation for inclusion as required in the Company's proxy statement and to review and discuss with management the Compensation Discussion and Analysis to be included in the Company's proxy statements and recommend such inclusion.
The Committee shall be composed of three or more directors, as determined by the Board, each of whom shall (i) satisfy the independence requirements of the Nasdaq Stock Market, (ii) qualify as a “Non-employee Director” for purposes of Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and (iii) qualify as an “outside director” for purposes of Section 162 (m) of the Internal Revenue Code of 1986, as amended. Members shall be appointed to, and removed from, the Committee by the Board. The Chief Executive Officer may not be present during any portion of a meeting of the Committee in which the Committee is voting or deliberating on the Chief Executive Officer’s compensation.
The Committee is charged by the Board with the responsibility to:
- Develop and periodically review compensation policies and practices applicable to executive officers, including the criteria upon which executive compensation is based, the specific relationship of corporate performance to executive compensation and the composition in terms of base salary, deferred compensation and incentive or equity-based compensation and other benefits.
- Review and approve corporate goals and objectives relevant to Chief Executive Officer compensation, evaluate the CEO's performance in light of these goals and objectives, and set the CEO's compensation level based on this evaluation.
- Review bases for and amounts of compensation for other executive officers.
- Supervise, administer and evaluate incentive, equity-based and other compensatory plans of the Company in which executive officers and key employees participate, including approving guidelines and size of grants and awards, making grants and awards, interpreting and promulgating rules relating to the plans, modifying or canceling grants or awards, designating employees eligible to participate and imposing limitations and conditions on grants or awards.
- Review and approve, subject to stockholder approval as required, the creation or amendment of any incentive, equity-based and other compensatory plans of the Company in which executive officers and key employees participate, other than amendments to tax-qualified employee benefit plans and trusts, and any supplemental plans thereunder, that do not substantially alter the costs of such plans to the Company or are to conform such plans to applicable laws or regulations.
- Review and approve any employment agreements, severance arrangements, change-in-control arrangements or special or supplemental employee benefits, and any material amendments to any of the foregoing, applicable to executive officers.
- Review periodically the compensation and benefits offered to nonemployee directors and recommend changes to the Board as appropriate.
- Review compensation information included in the Proxy Statement for the Annual Meeting, including the Compensation Discussion and Analysis and approve the Compensation Committee Report.
- Provide minutes of Committee meetings to the Board, and report to the Board on any significant matters arising from the Committee's work.
- At least annually, evaluate the performance of the Committee, review and reassess this Charter and, if appropriate, recommend changes to the Board.
- Perform such other duties and responsibilities as may be assigned to the Committee by the Board or as designated in plan documents.
In accordance with Nasdaq Rule 5605(d)(3) and as required by Rule 10C-1(b)(2), (3) and (4)(i)-(vi) under the Exchange Act, the Committee has the following additional responsibilities and authority:
(A) The Committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel or other adviser.
(B) The Committee shall be directly responsible for the appointment, compensation and oversight of the work of any compensation consultant, legal counsel and other adviser retained by the Committee.
(C) The Company must provide for appropriate funding, as determined by the Committee, for payment of reasonable compensation to a compensation consultant, legal counsel or any other adviser retained by the Committee.
(D) The Committee may select, or receive advice from, a compensation consultant, legal counsel or other adviser to the Committee, other than in-house legal counsel, only after taking into consideration the following factors:
(i) the provision of other services to the Company by the person that employs the compensation consultant, legal counsel or other adviser;
(ii) the amount of fees received from the Company by the person that employs the compensation consultant, legal counsel or other adviser, as a percentage of the total revenue of the person that employs the compensation consultant, legal counsel or other adviser;
(iii) the policies and procedures of the person that employs the compensation consultant, legal counsel or other adviser that are designed to prevent conflicts of interest;
(iv) any business or personal relationship of the compensation consultant, legal counsel or other adviser with a member of the Committee;
(v) any stock of the Company owned by the compensation consultant, legal counsel or other adviser; and
(vi) any business or personal relationship of the compensation consultant, legal counsel, other adviser or the person employing the adviser with an Executive Officer of the Company.
Nothing in this section shall be construed: (i) to require the Committee to implement or act consistently with the advice or recommendations of the compensation consultant, legal counsel or other adviser to the compensation committee; or (ii) to affect the ability or obligation of a Committee to exercise its own judgment in fulfillment of the duties of the Committee.
The Committee is required to conduct the independence assessment outlined in this section with respect to any compensation consultant, legal counsel or other adviser that provides advice to the Committee, other than in-house legal counsel. However, nothing in this section requires a compensation consultant, legal counsel or other compensation adviser to be independent, only that the Committee consider the enumerated independence factors before selecting, or receiving advice from, a compensation adviser. The Committee may select, or receive advice from, any compensation adviser it prefers, including ones that are not independent, after considering the six independence factors outlined above.
For purposes of this section, the Committee is not required to conduct an independence assessment for a compensation adviser that acts in a role limited to the following activities for which no disclosure is required under Item 407(e)(3)(iii) of Regulation S-K under the Exchange Act: (a) consulting on any broad-based plan that does not discriminate in scope, terms, or operation, in favor of executive officers or directors of the Company, and that is available generally to all salaried employees; and/or (b) providing information that either is not customized for a particular issuer or that is customized based on parameters that are not developed by the adviser, and about which the adviser does not provide advice.
By adopting this Charter, the Board delegates to the Committee full and exclusive authority to:
- Perform each of the responsibilities of the Committee described above.
- Delegate such of its authority and responsibilities as the Committee deems proper to members of the Committee.
- Appoint a chair of the Committee, unless a chair is designated by the Board.
- Retain and terminate compensation consultants, independent counsel and such other advisors as the Committee determines necessary to carry out its responsibilities, and approve the fees and other terms of retention of any such advisors.
- Obtain advice and assistance from legal or other advisors.
- Financial Expert
- Independent Director