The following Corporate Governance Guidelines (the “Guidelines”) have been adopted by the Board of Directors (the “Board”) of 1370 Realty Corp. (the “Company”) to assist and guide the Board in the exercise of its responsibilities. These Guidelines are in addition to, and should be interpreted in accordance with, any requirements imposed by our president and CEO, and the Certificate of Incorporation and Bylaws of the Company, each as amended. The Guidelines are subject to modification from time to time by the Board as it deems appropriate.
- Composition of the Board
- Size of the Board
The Board believes that it should have no fewer than 7 and no more than 11 directors. However, the Board may review the appropriate size of the Board as part of its annual performance evaluation and in connection with its consideration of nominees for director.
- Percentage of Independent Directors
A majority of the Board shall satisfy the criteria for independence of a Board member established by the by laws (such directors are referred to herein as “Independent Directors”). The Board shall make its director independence determinations in accordance with the categorical standards attached hereto as Exhibit A.
- Board Membership Criteria
The Nominating and Corporate Governance Committee shall periodically review with the Board the minimum qualifications and the other appropriate skills and characteristics required of Board members in the context of the make-up of the Board and its committees at that time.
- Changed Circumstances
The Board believes that when a non-employee director’s principal occupation or business association terminates for any reason or materially changes, it is appropriate for such director to offer in writing to resign from the Board, subject to the Board’s discretion whether to accept his or her resignation. This policy is intended to provide the Board the opportunity to review the continued appropriateness of Board membership under changed circumstances.
- Term Limits
The Board does not believe that arbitrary limits on the number of consecutive terms a director may serve is appropriate in light of the substantial benefits resulting from a sustained focus on the Company’s business, strategy and industry over a significant period of time.
- Retirement Age
Unless nominated by the Board pursuant to a written contract between the Company and a third party, no person shall be nominated by the Board for election as a director following his or her 75th birthday, unless the Board waives this policy for a specific director in special circumstances. In addition, the Board shall not fill a vacancy on the Board with a person who would, if appointed, attain the age of 75 years prior to the end of his or her term, unless the Board waives this policy for a specific director in special circumstances.
- Selection and Orientation of New Directors
The Nominating and Corporate Governance Committee shall identify and recommend to the Board director nominees for election by the shareholders. The Board shall, in consideration of the recommendation of the Nominating and Corporate Governance Committee, select director nominees based on the Board membership criteria previously discussed. Management, working with the Board, shall design an orientation program which all new directors shall attend after their election. The orientation program shall, as appropriate, include background material on the Company and its business plan; meetings with members of senior management and management presentations designed to familiarize new directors with the Company’s principal officers, strategic plans, compliance programs and Code of Business Conduct and Ethics; and meetings with independent auditors and other outside advisors of the Company.
- Continuing Education
Management, working with the Board, shall periodically assess the continuing education needs of directors and shall design or identify programs to address specific needs. The goal of continuing education programs should be to assist the Board in fulfilling its duties and responsibilities and, to the extent practicable, to address areas for improvement, if any, that are identified as part of the Board’s annual performance evaluation.
- Director Resignation Policy
In accordance with the Bylaws of the Company, if none of the stockholders of the Company provides the Company notice of an intention to nominate one or more candidates to compete with the Board’s nominees in a director election, or if the stockholders of the Company have withdrawn all such nominations by the tenth day before the Company mails its notice of meeting to our stockholders, a nominee must receive more votes cast for than against his or her election or re-election in order to be elected or re-elected to the Board. The Board expects that an incumbent director shall tender his or her resignation to the Board for consideration if he or she fails to receive the required number of votes for re-election. If an incumbent director fails to receive the required vote for re-election and tenders his or her resignation, the Nominating and Corporate Governance Committee will act on an expedited basis to determine whether it is advisable to accept the director’s resignation and will submit a recommendation for prompt consideration by the Board. The Board will act on the tendered resignation within 90 days following certification of the stockholder vote and will promptly and publicly disclose its decision. The Board expects that a director whose resignation is under consideration shall abstain from participating in any decision regarding his or her resignation. If the resignation is not accepted, the director will continue to serve until the next annual meeting and until the director’s successor is duly elected and qualified or until the director’s earlier resignation or removal. The Nominating and Corporate Governance Committee and the Board may consider any factors they deem relevant in deciding whether to accept a director’s resignation.