OF THE BOARD OF TRUSTEES
(Adopted April 2004)
STATEMENT OF POLICY AND PURPOSE
The Board of Trustees of InnSuites Hospitality
Trust (the “Trust”) has appointed a Compensation Committee (the “Committee”) to
discharge the Board’s responsibilities relating to compensation of the Trust’s
Trustees and executive officers. The
Committee has overall responsibility for approving and evaluating Trustee and executive
officer compensation plans, policies and programs. The Committee is also responsible for producing an annual report
on executive compensation for inclusion in the Trust’s proxy statement.
COMPOSITION AND TERM
The Committee shall be
comprised of no fewer than three
Trustees as appointed by the Board. No
person shall serve as a member of the Committee who does not qualify as an
“independent” Trustee in accordance with American Stock Exchange listing
standards.
The Board will appoint
the members of the Committee annually, and each member will serve until such
member’s successor is duly designated or until such member’s earlier
resignation or removal. The Board may
remove any member of the Committee, with or without cause, by a majority vote
of the full Board. Unless the Board
designates a Chairperson of the Committee, the members of the Committee will
designate a Chairperson by a majority vote of the full Committee. The Chairperson will chair all regular
sessions of the Committee and will set the agendas for Committee meetings.
DUTIES AND
RESPONSIBILITIES
It is the overriding
responsibility of the Committee to manage and oversee the Trust’s employee
benefit and equity compensation plans, and to make recommendations to the Board
regarding executive officer and Trustee compensation.
The following
functions shall be common recurring activities of the Committee in carrying out
its purpose set forth in this Charter.
These functions should serve as a guide, with the understanding that the
Committee may carry out additional functions and adopt additional policies and
procedures as may be appropriate in light of changing business, legislative,
regulatory, legal and other conditions.
The Committee shall also carry out any other responsibilities and duties
delegated to it by the Board from time to time related to the purposes of the
Committee set forth in this Charter.
The Committee, in
discharging its oversight role, is empowered to study or investigate any matter
of interest or concern within the purpose of the Committee set forth in this
Charter that the Committee deems appropriate or necessary, and the Committee
shall have the authority to retain and terminate outside counsel or other
experts for this purpose, including the authority to approve fees payable to
such counsel and experts and any other terms of retention.
To fulfill its
responsibilities and duties set forth in this Charter, the Committee shall do
the following:
1. Review and Determine Compensation for
Executive Officers and Trustees by:
a. establishing and reviewing the overall
executive compensation philosophy of the Trust;
b. reviewing and approving Trust goals and
objectives relevant to executive officers’ compensation, including annual
performance objectives;
c. evaluating the performance of the
executive officers in light of established goals and objectives and, based on
such evaluation, review and approve the annual salary, bonus, stock options,
other incentive awards and other benefits, direct and indirect, of the
executive officers;
d. recommending to the Board the granting
of equity-based awards to employees and non-employee Trustees of the Trust
under the Trust’s 1997 Stock Incentive and Option Plan and other equity
compensation plans;
e. selecting, retaining and (if necessary)
terminating any compensation and benefits consultant or other outside expert
needed to assist in the evaluation of Trustee or executive officer
compensation, approve such consultant’s and/or expert’s fees and other
retention terms and obtain advice and assistance from internal or external legal,
accounting or other advisors;
f. in connection with executive
compensation plans:
i. reviewing and recommending to the
Board, or approve as appropriate, new executive compensation plans and any
changes to or modifications of existing executive compensation plans;
ii. reviewing on a periodic basis the
operations of the Trust’s executive compensation programs to determine whether
they are properly coordinated and achieving their intended purpose;
iii. establishing and periodically reviewing
policies for the administration of executive compensation programs; and
iv. taking steps to modify any executive
compensation program that, upon analysis, is determined to yield compensation
or benefits that are not reasonably related to executive and corporate
performance;
g. establishing and periodically reviewing
policies in the area of senior management perquisites;
h. reviewing and recommending to the
Board, or approving, as appropriate, any contracts or other transactions with
current or former executive officers of the Trust and any non-independent
Trustee, including consulting arrangements, employment contracts, severance or
termination arrangements;
i. performing duties delegated to it by
the Board under various executive compensation plans; and
j. monitoring compliance by executives
with the terms and conditions of the Trust’s executive compensation plans.
2. Prepare Reports and Minutes in order
to:
a. prepare an
annual report on executive compensation for inclusion in the Trust’s proxy
statement, in accordance with applicable rules and regulations;
b. report
regularly to the Board (i) following meetings of the Committee, (ii) with
respect to such other matters as are relevant to the Committee’s discharge of
its responsibilities, and (iii) with respect to such recommendations as the
Committee may deem appropriate; and
c. maintain
minutes and other records of meetings and activities of the Committee.
Any
report to the Board may take the form of an oral report by the Chairperson or
any other member of the Committee designated by the Committee to make such
report.
ADMINISTRATIVE MATTERS
1. A majority of the Committee members
will serve as a quorum for the transaction of business. Committee meetings may be held by telephone
or other means of communication whereby all meeting participants may actively
participate.
2. The action of a majority of those
present (in person or by telephone or other means of permitted communication)
at a meeting at which a quorum is present will be an act of the Committee.
3. Any action which may be taken at a
meeting of the Committee may be taken by written action signed by all Committee
members, and such consent shall be filed with the Secretary of the Trust.
4. The Chief Financial Officer of the Trust will liaise between the
Committee and the Trust.
5. The Chief Financial Officer shall keep minutes of Committee
meetings.
6. The Committee will meet at least once a year and at such other
times as may be requested by its Chairperson and will routinely meet in
executive session to review such matters as the Committee, in its discretion,
determines to be appropriate.