1. Purpose. The primary purpose of the Nominating and Corporate Governance Committee (the “Committee”) of Jacksonville Bancorp, Inc. (the “Company”) is to (a) identify individuals who are qualified to serve on the Company’s Board of Directors (the “Board”), (b) recommend to the Board director nominees for the next annual meeting of the shareholders and nominees to fill vacancies on the Board, whether caused by retirement, resignation, death, increase in the number of authorized directors or otherwise, and (c) develop and recommend to the Board corporate governance principles applicable to the Company and in accordance with all applicable laws, rules, regulations and listing standards.
2. Membership. The Nominating and Corporate Governance Committee is a committee of the Board. The Committee shall consist of a minimum of three (3) directors, each of whom must be an independent director as defined by the Board in accordance with all applicable rules, regulations and agency listing standards.
3. Appointment. The Board shall appoint the members of the Committee at the annual meeting of the Board.
4. Vacancy. In the event a vacancy occurs on the Committee prior to the annual meeting of the Board, the Board shall appoint a member to fill such vacancy at such time.
5. Qualification. In appointing members to serve on the Committee, the Board shall consider (a) the business and professional experience and background of the member, (b) the member’s knowledge of and familiarity with corporate governance principles, (c) the member’s understanding of the business and operations of the Company, and (d) any other criteria or factors that the Board, in its discretion, shall deem to be relevant to the purpose and the fulfillment of the duties and responsibilities of the Committee.
6. Term. The Board shall determine, in its discretion, the term of membership of the Committee.
7. Chair. Unless the Board elects a Chair of the Committee, the Committee may, in its discretion, designate a Chair by an affirmative vote of the majority of the members of the Committee. In the absence of the Chairman of the Committee, any Committee member may preside over the meeting as long as a quorum exists.
8. Resignation; Removal. Any Committee member may resign from the Committee upon notice to the Chair of the Board. The Board may remove any member of the Committee at any such time the Board determines, in its reasonable judgment, that (a) such member no longer meets the qualification standard set forth in Section 5 of this Charter, or (b) it is in the best interest of the company or its shareholders to remove such member from the Committee.
9. Meetings. The Committee shall meet at least twice annually or more frequently, as may be necessary or appropriate to carry out its responsibilities. Meetings may be called by the Chair of the committee, by any two members of the Committee or by the Chair of the Board. All meetings of the committee shall be held pursuant to the bylaws of the Company with regard to notice and waiver thereof, and written minutes of each meeting shall be duly filed in the Company records. Reports of meeting of the Committee shall be made to the Board at its next regularly scheduled meeting following the Committee meeting and shall be accompanied by any recommendations to the Board approved by the Committee.
10. Quorum. A majority of the members of the committee will constitute a quorum for the transaction of business. The Committee may act by unanimous written consent in accordance with applicable law.
11. Evaluation. The Board shall perform and conduct an annual performance evaluation of the Committee to determine and assess whether the Committee is fulfilling all of its duties and responsibilities hereunder and under all applicable laws, rules, regulations, and listing standards. In performing this evaluation, the Board will solicit input from the Committee members, other Board members and as appropriate, management of the Company and review the results of the evaluation with the Committee.
12. Authority. The Committee shall have the sole and direct authority to engage, retain, approve payment of compensation to, and terminate any director search firm retained to identify and recommend possible candidates for Board membership. The Committee is authorized to obtain advice and assistance as it believes necessary from corporate personnel and from external legal, accounting and other advisors.
13. Duties and Responsibilities. The Committee shall have the duty and responsibility to carry out the following:
(a) Establish the criteria for the selection of new directors. In carrying out this responsibility, the Committee will at least annually (i) assess the appropriate skills and characteristics required of Board members in the context of the current make-up of the Board and the needs of the Company, and (ii) consider principles to be applied in filling vacancies and planning for Board succession;
(b) Periodically assess in connection with re-nomination recommendations the performance of incumbent directors based on appropriate criteria, which may include: (i) degree of understanding of strategies and businesses, (ii) degree of preparedness with respect to Board materials and issues, (iii) level of active, objective and constructive participation in meetings of the Board and committees, (iv) degree of understanding of general economic trends and corporate governance, (v) level of support of Company initiatives relating to customers and suppliers, (vi) quality of guidance with respect to the Company’s strategic and operating plans, (vii) level of involvement in selecting, motivating, evaluating and compensating the CEO, and (viii) level of involvement in representing the Company to the outside world;
(c) Consider and make recommendations to the Board regarding shareholder nominations for directors that are submitted in accordance with the Company’s bylaws and applicable law;
(d) Make recommendations to the Board concerning the size and composition of the Board subject to the Company’s bylaws and articles of incorporation;
(e) Develop a pool of potential director candidates for consideration in the event of a vacancy in the Board;
(f) Recommend to the Board directors to serve as chairs and members of other Board committees, monitor the functions of all standing Board committees, and make recommendations to the Board regarding the functions of such other committees;
(g) Review and recommend to the Board the compensation of directors;
(h) Recommend to the Board (i) the Company’s policy on director tenure and retirement, (ii) any amendment, termination or waiver of the policy, and (iii) whether or not the Board should approve the withdrawal of any resignation submitted by a director in accordance with the policy;
(i) Conduct, or engage one or more third parties to conduct, the appropriate and necessary inquiries into the backgrounds, experience and qualifications of possible candidates to serve on the Board;
(j) Lead the process to evaluate, at least annually, the performance of the Board in the exercise of its oversight responsibilities, soliciting input from all members of the Board and, as appropriate, from management of the Company and review the results of the evaluation with the Board;
(k) Review the status of each member of the Board and make recommendations to the Board with respect to the Board’s determination of whether Board members meet the independence requirements of any and all applicable rules, regulations and listing standards;
(l) Review annually the number of Board positions held by each Director to ensure sufficient attention is being given to Company matters and to establish criteria for avoiding related party conflicts;
(m) Monitor Board and Committee attendance with the expectation that each director will attend at least seventy-five percent (75%) of all meetings;
(n) Receive periodically from the Chief Executive Officer his or her recommendations regarding a successor, the development of other executive talent and the executive management needs of the company;
(o) Review periodically with the Chair of the Board and the Chief Executive Officer the succession plans for senior executive officers and make recommendations to the Board regarding the selection of individuals to occupy these positions;
(p) Review and recommend, on a regular basis, changes to the Company’s corporate governance guidelines, including conflict of interest and Related Party transaction policies, code of conduct for financial officers, and code of business conduct and ethics;
(q) Review the adequacy of the Company’s compliance policies and programs in such areas as antitrust laws, securities laws, confidential information, environmental protection, employee health and safety, patent and copyright laws, and discrimination and harassment (including equal employment opportunity);
(r) Review periodically with the Company’s general counsel, new legislation, regulations, and other developments, the Company’s legal compliance policy and make recommendations to the Board for any changes, amendments and modifications to these policies that the Committee shall deem desirable;
(s) Review and update this Charter periodically, at least annually, as may be necessary or appropriate;
(t) Report, on a periodic basis, to the Board regarding compliance with this Charter, the activities of the Committee and any issues with respect to the duties and responsibilities of the Committee; and
(u) Perform any other activities consistent with this Charter, the Company’s bylaws and all applicable laws, rules, regulations and listing standards, as the Committee deems necessary or appropriate.
The foregoing Charter of the Nominating and Corporate Governance Committee of the Board of Directors of Jacksonville Bancorp, Inc. became effective on May 24, 2005. It was reviewed and approved by the Nominating and Corporate Governance Committee on February 24, 2015.