The Board of Trustees has established the following three committees as part of its corporate governance structure. The chairperson of each of the three committees, and all of the committees’ members, are considered “independent” by the NYSE MKT LLC and the rules of the SEC.
- Audit Committee
- Compensation Committee
- Nominating Committee
The committee charters for the Audit and Nominating Committees are listed below:
AUDIT COMMITTEE CHARTER
There shall be a committee of the board of directors to be known as the audit committee. The audit committee shall be composed of at least two directors who are independent of the management of the corporation and are free of any relationship that, in the opinion of the board of directors, would interfere with their exercise of independent judgment as a committee member.
STATEMENT OF POLICY
The audit committee shall provide assistance to the corporate directors in fulfilling their responsibility to the shareholders, potential shareholders, and investment community relating to corporate accounting, reporting practices of the corporation, and the quality and integrity of the financial reports of the corporation. In so doing, it is the responsibility of the audit committee to maintain free and open means of communication between the directors, the independent auditors, and the financial management of the corporation.
In carrying out its responsibilities, the audit committee believes its policies and procedures should remain flexible, in order to best react to changing conditions and to ensure to the directors and shareholders that the corporate accounting and reporting practices of the corporation are in accordance with all requirements and are of the highest quality.
In carrying out these responsibilities, the audit committee will:
1. Review and recommend to the directors the independent auditors to be selected to audit the financial statements of the corporation.
2. Review written disclosures regarding independence from the independent auditors required by Independent Standards Board Standard No. 1.
3. Meet with the independent auditors and financial management of the corporation to review the scope of the proposed audit for the current year and the audit procedures to be utilized, and at the conclusion thereof review such audit, including any comments or recommendations of the independent auditors.
4. Review with the independent auditors and accounting personnel the critical accounting policies on which the financial statements are based, the adequacy and effectiveness of the accounting and financial controls of the corporation, and elicit any recommendations for the improvement of such internal control procedures or particular areas where new or more detailed controls or procedures are desirable. Particular emphasis should be given to the adequacy of such internal controls to expose any payments, transactions, or procedures that might by deemed illegal or otherwise improper. Further, the committee periodically should review company policy statements to determine their adherence to the code of conduct.
5. Review the financial statements contained in the annual report to shareholders with management and the independent auditors to determine that the independent auditors are satisfied with the disclosure and content of the financial statements to be presented to the shareholders. Any changes in accounting principles should be reviewed.
6. Provide sufficient opportunity for the independent auditors to meet with the members of the audit committee without members of management present. Among the items to be discussed in these meetings are the independent auditors’ evaluation of the corporation’s accounting, personnel, and the cooperation that the independent auditors received during the course of the audit.
7. Review accounting and financial human resources and succession planning within the company.
8. Submit the minutes of all meetings of the audit committee to, or discuss the matters discussed at each committee meeting with, the board of directors.
9. Investigate any matter brought to its attention within the scope of its duties, with the power to retain specialists and outside counsel for this purpose if, in its judgment, that is appropriate.
NOMINATING COMMITTEE CHARTER
The Board of Trustees has established a Nominating Committee whose purpose is to seek and nominate qualified candidates for election or appointment to Power REIT’s Board of Trustees.
The Nominating Committee will consist of a minimum of three members of the Board of Trustees, all of whom shall be independent trustees pursuant to all applicable SEC and NYSE MKT LLC standards. The members of the Nominating Committee will be appointed by and serve at the discretion of the Board of Trustees.
CANDIDATE NOMINATION AND APPOINTMENT REQUIREMENTS
The Nominating Committee believes that it is in the best interest of the Trust and its shareholders to obtain highly qualified candidates to serve as members of the Board of Trustees. The Nominating Committee will seek candidates for election and appointment that possess the integrity, leadership skills and competency required to direct and oversee the Trust’s management in the best interests of its shareholders, customers, employees, communities it serves and other affected parties.
A candidate must be willing to regularly attend Committee and Board of Trustee’s meetings, to develop a strong understanding of the Company, its businesses and its requirements, to contribute his or her time and knowledge to the Company and to be prepared to exercise his or her duties with skill and care.
In addition, each candidate should have an understanding of all governance concepts and the legal duties of a trustee of a public company.
The responsibilities of the Nominating Committee shall include:
1. Developing and evaluating potential trustee candidates for consideration in the event of a vacancy on the Board of Trustees. Shareholders may contact the Nominating Committee Chairman, the Chairman of the Board or the Corporate Secretary by writing to the Trust at its principal business office when proposing a nominee. This correspondence should include a detailed description of the proposed nominee’s qualifications and a method to contact that nominee if the Nominating Committee so chooses.
2. Recommending nominees to the full Board of Trustees.
1. Names of candidates for election to the Board of Trustees will be solicited by the Nominating Committee from sources deemed reasonable by the Committee, including any shareholder nominees.
2. Candidates viewed by the Committee as qualified and suitable for service as a trustee will be contacted to determine interest in being considered to serve on the Board of Trustees and, if interested, will be interviewed and qualifications established.
3. The Committee will make a formal recommendation to the Board of Trustees.
4. If approved, the Board of Trustees will instruct the Corporate Secretary to include the candidates name in the Company’s proxy material, or if filling a vacancy, to announce such event through the filing of an 8-K or press release.