PURPOSE OF THE COMMITTEE The purposes of the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of Avalanche Treasury Corporation (the “Corporation”) shall be: (i) to oversee the Corporation’s compensation and employee benefit plans and practices, including its executive and director compensation plans, and its incentive-compensation and equity-based plans; (ii) to review and discuss with management the Corporation’s compensation discussion and analysis (the “CD&A”) to be included in the Corporation’s annual proxy statement or annual report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”); (iii) to prepare the Committee report as required by the rules of the SEC; and (iv) to perform such further functions as may be consistent with this Charter or assigned by applicable law, the Corporation’s certificate of incorporation and bylaws, as amended from time to time, or the Board.
COMPOSITION OF THE COMMITTEE The Committee shall consist of two or more independent directors as determined from time to time by the Board; provided, however, the Corporation may utilize any phase-in or exemptions that The Nasdaq Stock Market LLC (“Nasdaq”) allows for controlled companies, such as but not limited to the exemption from having a Compensation Committee made up solely of independent directors. Each member of the Committee shall be qualified to serve on the Committee pursuant to the requirements of Nasdaq and any additional requirements that the Board deems appropriate. Members of the Committee shall also qualify as “non-employee directors” within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and to the extent deemed necessary or appropriate by the Board to administer performance-based compensation, “outside directors” within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”).
The chairperson of the Committee shall be designated by the Board, provided that if the Board does not so designate a chairperson, the members of the Committee, by a majority vote, may designate a chairperson.
Any vacancy on the Committee shall be filled by majority vote of the Board. No member of the Committee shall be removed except by majority vote of the Board.
MEETINGS AND PROCEDURES OF THE COMMITTEE The Committee shall meet as often as it determines necessary to carry out its duties and responsibilities, but no less than twice annually. The Committee, in its discretion, may ask members of management or others to attend its meetings (or portions thereof) and to provide pertinent information as necessary, provided, that the Chief Executive Officer of the Corporation may not be present during any portion of a Committee meeting in which deliberation or any vote regarding his or her compensation occurs.
A majority of the members of the Committee present shall constitute a quorum for a meeting and the affirmative vote of a majority of members present at a meeting at which a quorum is present shall constitute the action of the Committee. A person may participate in a meeting of the Committee by conference telephone, video, a virtual platform or other communications equipment by means of which all the persons participating in the meeting can communicate with each other at the same time. Participation by a person in a meeting in this manner is treated as presence in person at that meeting. Unless otherwise determined by the members of the Committee the meeting shall be deemed to be held at the place where the chairperson is located at the start of the meeting. The Committee shall otherwise establish its own rules of procedure.
The Committee shall maintain minutes of its meetings and records relating to those meetings and shall report regularly to the Board on its activities, as appropriate. Committee actions may be taken by unanimous written consent.
DUTIES AND RESPONSIBILITIES OF THE COMMITTEE
Executive Compensation The Committee shall have the following duties and responsibilities with respect to the Corporation’s executive compensation plans:
(a) Review at least annually the goals and objectives of the Corporation’s executive compensation plans, and amend, or recommend that the Board amend, these goals and objectives if the Committee deems it appropriate.
(b) Review at least annually the Corporation’s executive compensation plans in light of the Corporation’s goals and objectives with respect to such plans, and, if the Committee deems it appropriate, adopt, or recommend that the Board adopt, new, or amend existing, executive compensation plans.
(c) Evaluate annually the performance of the Chief Executive Officer in light of the goals and objectives of the Corporation’s executive compensation plans, and, either as a Committee or together with the other independent directors (as directed by the Board), determine and approve the Chief Executive Officer’s compensation level based on this evaluation. In determining the long-term incentive component of the Chief Executive Officer’s compensation, the Committee shall consider any factors as it determines relevant. The Committee may discuss the Chief Executive Officer’s compensation with the Board if it chooses to do so.
(d) Evaluate annually the performance of the other executive officers of the Corporation in light of the goals and objectives of the Corporation’s executive compensation plans, and either as a Committee or together with the other independent directors (as directed by the Board), determine and approve the compensation of such other executive officers. To the extent that long-term incentive compensation is a component of such executive officer’s compensation, the Committee shall consider all relevant factors in determining the appropriate level of such compensation, including the factors applicable with respect to the Chief Executive Officer.
(e) Evaluate annually and recommend to the Board the appropriate form and amount of compensation for Board and Committee service by non-employee directors.
(f)) Review and approve any employment, severance or termination arrangements to be made with any executive officer of the Corporation.
(g) Perform such duties and responsibilities as may be assigned to the Board or the Committee under the terms of any executive compensation plan.
(h) Review perquisites or other personal benefits to the Corporation’s executive officers and directors and recommend any changes to the Board.
(i) Consider the results of the most recent stockholder advisory vote on executive compensation as required by Section 14A of the Exchange Act and, to the extent the Committee determines it appropriate to do so, take such results into consideration in connection with the review and approval of executive officer compensation.
(j) Review and discuss with management the Corporation’s CD&A, and based on that review and discussion, recommend to the Board that the CD&A be included in the Corporation’s annual proxy statement or annual report on Form 10-K.
(k) Review compensation arrangements for the Corporation’s employees to evaluate whether incentive and other forms of pay encourage unnecessary or excessive risk taking, and review and discuss, at least annually, the relationship between risk management policies and practices, corporate strategy and the Corporation’s compensation arrangements.
(l) Review and approve, to the extent it deems necessary or as required by applicable law, the terms of any compensation “clawback” or similar policy or agreement between the Corporation and its executive officers or other employees for recovering incentive-based compensation.
(m) Adopt to the extent it deems necessary or appropriate, stock ownership guidelines for executive officers and non-employee directors and oversee compliance with such guidelines.
(n) Prepare the Committee report in accordance with the rules and regulations of the SEC for inclusion in the Corporation’s annual proxy statement or annual report on Form 10-K.
(o) Review stockholder proposals and advisory stockholder votes relating to executive compensation matters, including advisory votes on executive compensation and the frequency of such votes, incentive and other compensation plans and amendments to such plans, and recommend to the Board the Corporation’s response to such proposals and votes.
Notwithstanding anything to the contrary in the foregoing, the Committee shall have sole discretion and authority with respect to any action regarding compensation payable to the Chief Executive Officer or other executive officers of the Corporation that the Committee intends to constitute “qualified performance-based compensation” for purposes of Section 162(m) of the U.S. Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder.
General Compensation and Employee Benefit Plans The Committee shall have the following duties and responsibilities with respect to the Corporation’s general compensation and employee benefit plans, including incentive-compensation and equity-based plans:
(a) Review at least annually the goals and objectives of the Corporation’s general compensation plans and other employee benefit plans, including incentive-compensation and equity-based plans, and amend, or recommend that the Board amend, these goals and objectives if the Committee deems it appropriate.
(b) Review at least annually the Corporation’s general compensation plans and other employee benefit plans, including incentive-compensation and equity-based plans, in light of the goals and objectives of these plans, and recommend that the Board amend these plans if the Committee deems it appropriate.
(c) Review all equity-compensation plans to be submitted for stockholder approval under the Nasdaq listing standards, and review and, in the Committee’s sole discretion, approve all equity-compensation plans that are exempt from such stockholder approval requirement.
(d) Perform such duties and responsibilities as may be assigned to the Board or the Committee under the terms of any compensation or other employee benefit plan, including any incentive-compensation or equity-based plan.
ROLE OF CHIEF EXECUTIVE OFFICER The Chief Executive Officer may make, and the Committee may consider, recommendations to the Committee regarding the Corporation’s compensation and employee benefit plans and practices, including its executive compensation plans, and its incentive-compensation and equity-based plans with respect to executive officers other than the Chief Executive Officer and the Corporation’s director compensation arrangements.
SUBCOMMITTEES; DELEGATION OF AUTHORITY The Committee may form subcommittees for any purpose that the Committee deems appropriate and may delegate to such subcommittees such power and authority as the Committee deems appropriate; provided, however, that no subcommittee shall consist of fewer than two members; and provided further that the Committee shall not delegate to a subcommittee any power or authority required by any law, regulation or listing standard to be exercised by the Committee as a whole. Actions taken by any subcommittee shall be presented to the full Committee at the next Committee meeting.
EVALUATION OF THE COMMITTEE The Committee shall, at least annually and in coordination with the Nominating and Corporate Governance Committee, evaluate its performance. In conducting this review, the Committee shall evaluate whether this Charter appropriately addresses the matters that are or should be within its scope and shall recommend such changes as it deems necessary or appropriate. The Committee shall address all matters that the Committee considers relevant to its performance, including at least the following: the adequacy, appropriateness and quality of the information and recommendations presented by the Committee to the Board, the manner in which they were discussed or debated, and whether the number and length of meetings of the Committee were adequate for the Committee to complete its work in a thorough and thoughtful manner.The Committee shall deliver to the Board a report, which may be oral, setting forth the results of its evaluation, including any recommended amendments to this Charter and any recommended changes to the Corporation’s or the Board’s policies or procedures.
INVESTIGATIONS AND STUDIES; OUTSIDE ADVISERS The Committee may conduct or authorize investigations into or studies of matters within the Committee’s scope of responsibilities, and may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel or other adviser. The Committee shall be directly responsible for the appointment, compensation and oversight of the work of any compensation consultant, legal counsel or other adviser retained by the Committee, the expense of which shall be borne by the Corporation. The Corporation may incur any additional expenses it deems necessary or appropriate in the performance of its duties, unless prohibited by applicable law. The Committee may select a compensation consultant, legal counsel or other adviser to the Committee only after taking into consideration all factors relevant to that person’s independence from management, including the factors specified in the applicable Nasdaq listing standards following:
(a) The provision of other services to the Corporation by the person that employs the compensation consultant, legal counsel or other adviser;
(b) The amount of fees received from the Corporation by the person that employs the compensation consultant, legal counsel or other adviser, as a percentage of the total revenue of the person that employs the compensation consultant, legal counsel or other adviser;
(c) The policies and procedures of the person that employs the compensation consultant, legal counsel or other adviser that are designed to prevent conflicts of interest;
(d)Any business or personal relationship of the compensation consultant, legal counsel or other adviser with a member of the Committee;
(e) Any stock of the Corporation owned by the compensation consultant, legal counsel or other adviser; and
(f) Any business or personal relationship of the compensation consultant, legal counsel, other adviser or the person employing the adviser with an executive officer of the Corporation.
The Committee shall conduct the independence assessment with respect to any compensation consultant, legal counsel or other adviser that provides advice to the Committee, except that such review shall not be required for: (i) in-house legal counsel; and (ii) any compensation consultant, legal counsel or other adviser whose role is limited to the following activities for which no disclosure would be required under Item 407(e)(3) (iii) of Regulation S-K: consulting on any broad-based plan that does not discriminate in scope, terms, or operation, in favor of executive officers or directors of the Corporation, and that is available generally to all salaried employees; or providing information that either is not customized for the Corporation or that is customized based on parameters that are not developed by the compensation consultant, and about which the compensation consultant does not provide advice.
Nothing herein requires a compensation consultant, legal counsel or other adviser to be independent, only that the Committee consider the enumerated independence factors before selecting or receiving advice from a compensation consultant, legal counsel or other adviser. The Committee may select or receive advice from any compensation consultant, legal counsel or other adviser it prefers, including ones that are not independent, after considering the six independence factors outlined above.
Nothing herein shall be construed: (i) to require the Committee to implement or act consistently with the advice or recommendations of the compensation consultant, legal counsel or other adviser to the Committee; or (ii) to affect the ability or obligation of the Committee to exercise its own judgment in the fulfillment of its duties.
