Corporate Governance

Leadership Development and Compensation Committee Charter

PURPOSE:

 

Acting pursuant to Section 141 of the Delaware General Corporation Law and Section 1 of Article IV of the Bylaws (the "Bylaws") of Dell Inc. ("Dell"), the Board of Directors of Dell (the "Board") has established a Leadership Development and Compensation Committee (the "Committee") for the purposes of (a) evaluating the performance of, reviewing and recommending to the Board the compensation (including employment contracts and severance arrangements) to be provided to, the Chief Executive Officer (“CEO”), (b) reviewing and (except in the case of the CEO) approving, on behalf of the Board, all compensation (including employment contracts and severance arrangements) to be provided to each executive officer and non-employee director of Dell, including any perquisites and equity compensation and salary, bonus and equity compensation guidelines for all other employees of Dell, and (c) reviewing and (except in the case of the CEO) approving Dell's management succession plans and leadership development strategies.

 

MEMBERSHIP:

 

The Committee shall consist of a minimum of two members of the Board, all of whom shall be "independent" under the standards set forth in the Dell's Corporate Governance Principles, as well as under any additional or supplemental independence standards applicable to members of compensation committees of NASDAQ-listed companies under any applicable law, rule or regulation. In addition, the Committee shall consist of members who are (i) “Non-Employee Directors” for the purposes of Rule 16b-3 under the Securities Exchange Act of 1934, as in effect from time to time, and (ii) “outside directors” for the purposes of Section 162(m) of the Internal Revenue Code, as in effect from time to time. The members of the Committee will be recommended by the Governance and Nominating Committee of the Board and appointed by and serve at the discretion of the Board.

 

RESPONSIBILITIES:

 

The Committee shall be responsible for reviewing and approving, on behalf of the Board, the amounts and types of all compensation to be provided to each of Dell's executive officers and non-employee directors; provided, however, that the Committee's authority with respect to compensation to be paid to Dell's Chief Executive Officer shall be limited to reviewing and making appropriate recommendations to the Board, with the authority to approve such compensation being specifically reserved to the full Board. The Committee shall also be responsible for reviewing and approving, on behalf of the Board, salary, bonus and equity compensation guidelines for all other Dell employees, and administering Dell's equity compensation plans. Such responsibilities include the following:

    1. Reviewing with Dell's management and approving (except as noted above) the compensation policy for executive officers and non-employee directors of Dell, and such other managers of Dell as directed by the Board.
    2. Reviewing with Dell management and approving (except as noted above) all forms of compensation (including all "plan" compensation, as such term is defined in Item 402(a)(6) of Regulation S‑K promulgated by the Securities and Exchange Commission, and all non-plan compensation and perquisites) to be provided to each executive officer and non-employee director of Dell.
    3. Reviewing with Dell's management and approving recommendations with regard to aggregate salary and bonus budget and guidelines for all other Dell employees.
    4. Acting as administrator of Dell's compensation plans, including granting awards to each executive officer and director, reviewing aggregate awards for other eligible individuals, and determining the terms and conditions of such awards. The Committee shall also make recommendations to the Board with respect to approvals, terminations, and amendments to the plans and changes in the number of shares reserved for issuance there under.
    5. Reviewing and discussing with Dell's management the compensation discussion and analysis disclosure required to be included in Dell's annual proxy statement or Annual Report on Form 10‑K to be filed with the Securities and Exchange Commission and, based on this review and discussion, determining whether to recommend to the Board that the compensation discussion and analysis disclosure be included in Dell's annual proxy statement or Annual Report on Form 10‑K to be filed with the Securities and Exchange Commission.
    6. Preparing the Committee report required by the rules of the Securities and Exchange Commission to be included in Dell's annual proxy statement or Annual Report on Form 10-K.
    7. Reviewing and discussing with the full Board Dell's management succession plan at least annually, as well as Dell's leadership development strategies and executive retention and diversity strategies.
    8. Evaluating and discussing with the full Board the performance of the Chief Executive Officer of Dell (and such other executive officers as the Committee deems appropriate) in light of Dell's current business environment and Dell's strategic objectives. Evaluating the need for, and provisions of, employment contracts or severance arrangements for Dell's executive officers.
    9. Monitoring summary data on Dell's employee population (e.g., total compensation costs, compensation benchmark data, employee diversity, turnover levels, etc.).
    10. Reviewing and assessing annually the adequacy of this Charter and the performance of the Committee, and recommending to the Board for approval any proposed changes to this Charter or the Committee.
    11. Reviewing any compensation clawback policy as required by any applicable law, rule or regulation.
    12. Approving issuances of equity under any tax qualified, non-discriminatory employee benefit plans or parallel nonqualified plans.
    13. Reviewing and approving Dell’s peer companies for purposes of evaluating compensation competitiveness and establishing the appropriate competitive positioning of the levels and mix of compensation elements.
    14. Reviewing and make recommendations with respect to stockholder proposals related to compensation matters including advisory votes on executive compensation and the frequency of such votes.
    15. Determining stock ownership guidelines for the Board and executives and monitoring compliance with such guidelines.
    16. Overseeing employee benefit plan investment policies, administration and performance, including appointment and removal of members of any related investment policy committees.

In addition to the above responsibilities, the Committee will undertake such other duties as the Board delegates to it, and will report periodically to the Board regarding the Committee's examinations and recommendations.

In carrying out its responsibilities, the Committee shall have the power and authority to retain such compensation consultants, outside counsel and other advisors as the Committee may deem appropriate and shall have the sole authority to approve the fees and other terms of engagement. In connection with the retention of these advisors, the Committee will take into consideration the independence of any advisor as required by any applicable law, rule or regulation.

RESOURCES AND AUTHORITY:

The Committee shall have the resources and authority to discharge its responsibilities, including the authority, to the extent it deems necessary or appropriate, to retain compensation consultants, outside counsel and other advisors. Dell shall provide funding, as determined by the Committee, for payment of compensation to any compensation consultants, independent advisors or administrative support employed by the Committee.

Any action duly and validly taken by the Committee pursuant to the power and authority conferred under this Charter shall for all purposes constitute an action duly and validly taken by the Board and may be certified as such by the Secretary or other authorized officer of Dell.

The Committee may delegate any of its responsibilities to a subcommittee composed of one or more members of the Committee to the extent permitted by applicable law and listing standards.

MEETINGS AND REPORTS:

 

The Committee shall hold regular meetings at least four times every year, generally in conjunction with the regularly scheduled meetings of the Board, and such special meetings as the Chair of the Committee, the Lead Director or the Chairman of the Board may request, with further actions to be taken by unanimous consent when deemed necessary or desirable by the Committee. The Committee may invite such members of management to its meetings as it deems appropriate, consistent with the maintenance of the confidentiality of compensation discussions. The CEO may not attend any meeting where the CEO’s performance or compensation is discussed, unless specifically invited by the Committee. The Committee will maintain written minutes of its meetings, which will be filed with the minutes of the meetings of the Board. At each regularly scheduled meeting of the Board, the Chair of the Committee shall provide the Board with a comprehensive report of the Committee's activities, recommendations and proceedings.