Board Committees
Tetra Tech's Board of Directors is currently comprised of seven members. Directors are elected annually for one-year terms.
1. Review the annual audited financial statements with management and the independent auditor, including major issues regarding accounting and auditing principles and practices, as well as the adequacy of internal controls, that could significantly affect the Company's financial statements; recommend to the Board inclusion of the financial statements in the Form 10-K.
2. Review an analysis prepared by management and the independent auditor of significant financial reporting issues and judgments made in connection with the preparation of the Company's financial statements, including, if appropriate, an analysis of the effect of alternative GAAP methods on the Company's financial statements; and resolve any disagreements between management and the independent auditor regarding financial reporting.
3. Review with management and the independent auditor the effect of regulatory and accounting initiatives, as well as off-balance sheet structures, if any, on the Company's financial statements.
4. Review with management and the independent auditor the Company's quarterly financial results prior to the release regarding earnings and the filing of its Form 10-Q; such review shall include the items required by SAS 71 and the Sarbanes-Oxley Act of 2002.
5. Review proposed major changes to the Company's auditing and accounting principles and practices as suggested by the independent auditor, internal auditors or management.
6. Appoint the independent auditor, which firm is ultimately accountable and reports to the Audit Committee.
7. Review the experience, performance and qualifications of the senior members of the independent auditor team.
8. Approve the fees to be paid to the independent auditor for audit services.
9. Approve, in advance, the retention of the independent auditor for any non-audit service that the independent auditor is not prohibited from providing to the Company, and the fee for such service. A list of non-audit services that the independent auditor is prohibited from providing to the Company is attached as Schedule 1 hereto. Report the approval of any permitted non-audit services to management for disclosure in the Company's periodic reports.
10. Receive periodic reports from the independent auditor regarding its independence, discuss such reports with the auditor, consider whether the provision of non-audit services is compatible with maintaining the auditor's independence and, if so, take appropriate action to satisfy itself of the independence of the auditor.
11. Evaluate the performance of the independent auditor and determine whether the independent auditor should be replaced.
12. Set guidelines for the Company's hiring of employees of the independent auditor who were engaged on the Company's account.
13. Review and approve (i) the internal audit team's responsibilities, performance, budget and staffing; and (ii) any changes required in the planned scope of the internal audit.
14. Inquire as to issues on which the national office of the independent auditor was consulted by the Company's audit team.
15. Review the significant reports to management prepared by the internal auditing team and management's responses.
16. Meet with the independent auditor prior to the audit to review the planning and staffing of the audit.
17. Obtain reports from management and the independent auditor with respect to the Company's operating policies, including disclosures of executive officer, director and affiliated party transactions; review and approve all executive officer, director and related-party transactions.
18. Review with management, the Director of Management Audit and the independent auditor any correspondence with regulators or governmental agencies and any employee complaints or published reports that raise material issues regarding the Company's financial statements or accounting policies.
19. Review with the independent auditor any problems or difficulties the auditor may have encountered during the course of its audit or otherwise, and any management letter provided by the auditor and the Company's response to that letter. Such review should include any difficulties encountered in the course of the audit work, including any restrictions on the scope of activities or access to required information, and any disagreements with management.
20. Prepare the report required by the rules of the Securities and Exchange Commission to be included in the Company's annual proxy statement.
21. Review with the Company's General Counsel legal matters that may have a material impact on the financial statements, the Company's compliance policies and any material reports or inquiries received from regulators or governmental agencies.
22. Review with the Company's Risk Manager Company policies and procedures with respect to risk assessment and risk management.
23. Meet at least quarterly (either in person or by conference telephone) with the independent auditor in a separate session and, if deemed necessary, with the chief financial officer and/or a member of the Company's internal audit team in separate sessions.
24. Retain and determine the compensation for independent legal, accounting and other experts, as it determines necessary to carry out its duties.
25. Establish procedures for (i) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters; and (ii) the confidential, anonymous submission by Company employees of concerns regarding questionable accounting or auditing matters.
26. Review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval, including the independence of Committee members and satisfaction of the "financial expert" requirement.
Compensation Committee Charter
1. Evaluating the performance of the Chairman and the CEO in light of the Company's performance goals and objectives, and setting the compensation level of the Chairman and the CEO based upon the evaluation of their respective performances.
2. Evaluating the performance of the Company's other elected officers based upon the CEO's assessment and the Company's performance goals and objectives, and setting the compensation level of such elected officers based upon the CEO's recommendations and the respective performance evaluations. With respect to the CFO, the evaluation shall be done jointly with the Audit Committee.
3. Making recommendations to the Board with respect to incentive-based compensation plans, equity-based plans and executive benefits.
4. Preparing the Report of the Compensation Committee to be included in each proxy statement relating to the Company's annual meeting of stockholders.
5. Reviewing and approving all grants of equity awards under the 2005 Equity Incentive Plan.
6. Overseeing the administration of the Employee Stock Purchase Plan.
7. Reviewing and making recommendations to the Board with regard to the Company's overall compensation philosophy and objectives.
Nominating and Corporate Governance Committee Charter
1. Establishing the criteria for Board membership and the number of members.
2. Considering, recommending and recruiting candidates to fill positions on the Board.
3. Conducting the appropriate and necessary inquiries into the backgrounds and qualifications of possible candidates.
4. Recommending the director nominees for approval by the Board and the stockholders.
5. Considering questions of possible conflicts of interest of Board members and of the Company's senior executives.
6. Monitoring and recommending the functions of the various committees of the Board, and approving their charters.
7. Recommending members of the committees.
8. Advising on changes in Board compensation.
9. Making recommendations on the structure of Board meetings.
10. Recommending nominating and corporate governance matters for consideration by the Board.
11. Considering matters of corporate governance and reviewing, periodically, the Company's corporate governance principles.
12. Establishing director retirement policies.
13. Reviewing annually with the Chairman and CEO the succession plans relating to positions held by elected corporate officers and making recommendations to the Board with respect to the selection of individuals to occupy these positions.
14. Making an annual assessment of the overall performance of the Board.
Strategic Planning Committee Charter
1. Reviewing and recommending to the Board management’s long-term strategy for the Company, which shall include the allocation of corporate resources.
2. Reviewing and recommending to the Board certain strategic decisions regarding exit from existing lines of business and entry into new lines of business, acquisitions, joint ventures, investments or dispositions of businesses and assets, and the financing of related transactions.
3. Reviewing the allocation of corporate resources recommended by management, including the relationship of activities and allocations with the long-term business objectives and strategic plans of the Company.
4. The Chairman of the Committee working with the Company’s Chairman and Chief Executive Officer to set Board agendas.
5. Working with the Company’s executive management to schedule and structure the annual strategic planning meeting.
6. Reviewing the Company’s technology strengths and external technology trends to assess the impact of technology on business strategy and resource allocation.
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