Exhibit 99.2
DDS TECHNOLOGIES USA, INC. (the "Company")
COMPENSATION COMMITTEE CHARTER
Purpose
The purpose of the Compensation Committee (the "Committee") shall be as
follows:
1. To determine, or recommend to the Board of Directors for determination,
the compensation of the Chief Executive Officer ("CEO") of the Company.
2. To determine, or recommend to the Board of Directors for determination,
the compensation of all other executive officers of the Company.
3. To discharge the responsibilities of the Board of Directors relating to
the Company's compensation programs and compensation of the Company's
executives.
4. To produce an annual report on executive compensation for inclusion in the
Company's annual proxy statement in accordance with applicable rules and
regulations of the Securities and Exchange Commission (the "SEC") and
other regulatory bodies.
The Board of Directors shall determine whether the Committee shall make
determinations as a Committee or shall make recommendations to the Board of
Directors.
Composition
The Committee shall consist of two or more members of the Board of
Directors, each of whom is determined by the Board of Directors to be
"independent" under the rules of the SEC.
To the extent the Committee consists of at least three members, one
director who is not independent under the SEC's rules, may be appointed to the
Committee, subject to the following:
o the director is not a current officer or employee, or a family member of
an officer or employee, of the Company;
o the Board of Directors, under exceptional and limited circumstances,
determines that such individual's membership on the Committee is required
by the best interests of the Company and its stockholders;
o the Company discloses in the proxy statement for the next annual meeting
of stockholders subsequent to such determination (or in its Form 10-K if
the Company does not file a proxy statement), the nature of the
relationship and the reason for that determination; and
o such person does not serve under this exception on the Committee for more
than two years.
Appointment and Removal
The members of the Committee shall be appointed by the Board of Directors.
A member shall serve until such member's successor is duly elected and qualified
or until such member's earlier resignation or removal. The members of the
Committee may be removed, with or without cause, by a majority vote of the Board
of Directors.
Chairman
Unless a Chairman is elected by the full Board of Directors, the members
of the Committee shall designate a Chairman by majority vote of the full
Committee membership. The Chairman will chair all regular sessions of the
Committee and set the agendas for Committee meetings.
Delegation to Subcommittees
The Board of Directors may allocate the responsibilities of the Committee
to other committees of its own designation provided that any such committee
consists solely of independent directors and has a published committee charter.
In fulfilling its responsibilities, the Committee also shall be entitled to
delegate any or all of its responsibilities to a subcommittee of the Committee.
Meetings
The Committee shall meet as frequently as circumstances dictate. The
Chairman of the Committee or a majority of the members of the Committee may call
meetings of the Committee. Any one or more of the members of the Committee may
participate in a meeting of the Committee by means of conference call or similar
communication device by means of which all persons participating in the meeting
can hear each other.
All non-management directors who are not members of the Committee may
attend meetings of the Committee, but may not vote. In addition, the Committee
may invite to its meetings any director, member of management of the Company,
and such other persons as it deems appropriate in order to carry out its
responsibilities. The Committee may also exclude from its meetings any persons
it deems appropriate.
As part of its review and establishment of the performance criteria and
compensation of designated key executives, the Committee should meet separately
at least on an annual basis with the CEO and any other corporate officers as it
deems appropriate. However, the Committee should also meet from time to time
without such officers present, and in all cases, such officers shall not be
present at meetings at which their performance and compensation are being
discussed and determined.
Duties and Responsibilities
The Committee shall carry out the duties and responsibilities set forth
below. These functions should serve as a guide with the understanding that the
Committee may determine to carry out additional functions and adopt additional
policies and procedures as may be appropriate in light of changing business,
legislative, regulatory, legal, or other conditions. The Committee shall also
carry out any other responsibilities and duties delegated to it by the Board of
Directors from time to time related to the purposes of the Committee outlined in
this Charter.
In discharging its oversight role, the Committee is empowered to study or
investigate any matter of interest or concern that the Committee deems
appropriate and shall have the sole authority, without seeking Board approval,
to retain outside counsel or other advisors for this purpose, including the
authority to approve the fees payable to such counsel or advisors and any other
terms of retention.
Setting Compensation for Executive Officers and Directors
1. Establish and review the overall compensation philosophy of the Company.
2. Review and approve the Company's corporate goals and objectives relevant
to the compensation for the CEO and other executive officers, including
annual performance objectives.
3. Evaluate the performance of the CEO and other executive officers in light
of those goals and objectives and, based on such evaluation, approve, or
recommend to the full Board of Directors the approval of, the annual
salary, bonus, stock options, and other benefits, direct and indirect, of
the CEO and other executive officers.
4. In approving or recommending the long-term incentive component of
compensation for the CEO and other executive officers, the Committee
should consider the Company's performance and relative stockholder return,
the value of similar incentive awards to CEOs and other executive officers
at comparable companies, and the awards given to the CEO and other
executive officers in past years. The Committee is not precluded from
approving awards (with the ratification of the Board of Directors) as may
be required to comply with applicable tax laws, such as Rule 162(m).
5. In connection with executive compensation programs, the Committee should
do the following:
(a) Review and recommend to the full Board of Directors, or approve, new
executive compensation programs;
(b) Review on a periodic basis the operations of the Company's executive
compensation programs to determine whether they are properly
coordinated and achieving their intended purposes;
(c) Establish and periodically review policies for the administration of
executive compensation programs; and
(d) Take steps to modify any executive compensation program that yields
payments and benefits that are not reasonably related to executive
and corporate performance.
6. Establish and periodically review policies in the area of senior
management perquisites.
7. Consider policies and procedures pertaining to expense accounts of senior
executives.
8. Review and recommend to the full Board of Directors compensation of
directors as well as directors' and officers' indemnification and
insurance matters.
9. To the extent not delegated to the Audit Committee by the Board of
Directors, review and approve all related party transactions (as specified
in Item 404 of Regulation S-K) and review and make recommendations to the
full Board of Directors, or approve, any contracts or other transactions
with current or former executive officers of the Company, including
consulting arrangements, employment agreements, change-in-control
agreements, severance agreements, termination arrangements, and loans to
employees made or guaranteed by the Company.
Monitoring Incentive- and Equity-Based Compensation Plans
10. Review and make recommendations to the full Board of Directors with
respect to, or approve, the Company's incentive-compensation plans and
equity-based plans, and review the activities of the individuals
responsible for administering those plans.
11. Review and make recommendations to the full Board of Directors, or
approve, all equity compensation plans of the Company that are not
otherwise subject to the approval of the Company's stockholders.
12. Review and make recommendations to the full Board of Directors, or
approve, all awards of shares or share options pursuant to the Company's
equity-based plans.
13. Monitor compliance by executives with the rules and guidelines of the
Company's equity-based plans.
14. Review and monitor employee pension, profit sharing, and benefit plans.
15. Have the sole authority to select, retain, and/or replace, as needed, any
compensation or other outside consultant to be used to assist in the
evaluation of director, CEO, or senior executive compensation. In the
event such a consultant is retained, the Committee shall have the sole
authority to approve such consultant's fees and other retention terms.
Reports
16. Prepare an annual report on executive compensation for inclusion in the
Company's proxy statement in accordance with applicable rules and
regulations of the SEC and other applicable regulatory bodies.
17. Report regularly to the Board of Directors with respect to matters that
are relevant to the Committee's discharge of its responsibilities and with
respect to such recommendations as the Committee may deem appropriate. The
report to the Board of Directors may take the form of an oral report by
the Chairman or any other member of the Committee designated by the
Committee to make such report.
18. Maintain minutes or other records of meetings and activities of the
Committee.