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I.
Purpose
The primary objectives of the Nominating/Corporate Governance
Committee are to assist the Board by: (i) identifying individuals
qualified to become Board members and recommending that
the Board select a group of Director nominees for each
next annual meeting of the Company's stockholders; (ii)
ensuring that the Audit, Compensation and Nominating/Corporate
Governance Committees of the Board shall have the benefit
of qualified and experienced "independent" Directors; and
(iii) developing and recommending to the Board a set of
effective corporate governance policies and procedures
applicable to the Company.
II. Organization
The Nominating/Corporate Governance Committee shall consist of three or more
Directors, each of whom shall satisfy the applicable independence requirements
of The New York Stock Exchange and any other regulatory requirements.
Committee members shall be elected by the Board at the annual organizational
meeting of the Board of Directors; members shall serve until their successors
shall be duly elected and qualified. The Committee's chairperson shall be designated
by the full Board or, if it does not do so, the Committee members shall elect
a Chairman by vote of a majority of the full Committee.
The Committee may form and delegate authority to subcommittees when appropriate.
III. Structure and Meetings
The chairperson of the Nominating/Corporate Governance Committee will preside
at each meeting and, in consultation with the other members of the Committee,
will set the frequency and length of each meeting and the agenda of items to
be addressed at each meeting. The chairperson of the Committee shall ensure that
the agenda for each meeting is circulated to each Committee member in advance
of the meeting.
IV. Goals and Responsibilities
The Nominating/Corporate Governance Committee shall: (i) develop and recommend
to the Board a set of corporate governance principles applicable to the Company,
and review and reassess the adequacy of such guidelines annually and recommend
to the Board any changes deemed appropriate; (ii) develop policies on the size
and composition of the Board; (iii) review possible candidates for Board membership
consistent with the Board's criteria for selecting new Directors; (iv) perform
Board performance evaluations on an annual basis; (v) annually recommend a slate
of nominees to the Board with respect to nominations for the Board at the annual
meeting of the Company's stockholders; and (vi) generally advise the Board (as
a whole) on corporate governance matters.
The Committee shall also advise the Board on (a) committee member qualifications,
(b) committee member appointments and removals, (c) committee structure and operations
(including authority to delegate to subcommittees), and (d) committee reporting
to the Board. The Committee shall maintain an orientation program for new Directors
and a continuing education program for all Directors.
The Committee may not recommend any person to serve as a Director after he or
she has passed his or her 72nd birthday, unless the Committee has voted, on an
annual basis, to waive, or continue to waive, the mandatory retirement of such
person as a Director of the Company. Notwithstanding the foregoing, the oldest
member of the Board shall retire at the Company's 2003 annual meeting of stockholders.
The next oldest member of the Board shall retire at the Company's 2004 annual
meeting of stockholders. This "then oldest Board member" retirement process shall
continue until there are no Board members over the age of 72. Thereafter, all
Board members will automatically retire from the Board at the Company's annual
meeting of stockholders following the date he or she turns 72. This automatic
retirement policy shall not apply to Henry Taub, the Company's founder.
The Committee will annually review and reassess the adequacy of this Charter
and recommend any proposed changes to the Board for approval.
The Committee shall perform any other activities consistent with this Charter,
the Company's By-laws and governing law as the Committee or the Board deems appropriate.
V. Performance Evaluation
The Nominating/Corporate Governance Committee shall conduct an annual performance
evaluation of itself.
VI. Committee Resources
The Nominating/Corporate Governance Committee shall have the authority to obtain
advice and seek assistance from internal or external legal, accounting or other
advisors. The Committee shall have the sole authority to retain and terminate
any search firm to be used to identify Director candidates, including sole authority
to approve such search firm's fees and other retention terms.
VII. Disclosure of Charter
This Charter will be made available on the Company's Web site at "www.adp.com."
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