Audit Committee Charter
The purpose of the Audit Committee (the “Committee“) of the Board of Directors (“Board“) of Fuel Tech, Inc., (“Company“) is to assist the Board in fulfilling its fiduciary responsibilities as to accounting policies and reporting practices of the Company in accordance with provisions of the charter set forth below (“Charter“).
The Committee shall consist of no fewer than three members of the Board and not less than that number of independent directors and financial experts who shall, in the opinion of the Board, meet the requirements of applicable stock exchange rules and law and regulations from time to time in effect. Each member of the Committee shall meet the independence requirements of the Nasdaq Stock Market, Inc. (“Nasdaq“) and the U.S. Securities and Exchange Commission (“SEC“) that from time to time are in effect. The members of the Committee shall be appointed and replaced by the Board, shall be independent of the Company and its subsidiaries and shall have no relationship to the Company or its subsidiaries that may interfere with the exercise of their independence. Appointment to the Committee shall not signify that the appointee has a higher degree of liability than other directors of the Board. The designation of any member of the Committee as a “financial expert“ is not intended and shall not be construed as imposing a higher degree of individual responsibility, obligation or liability on such member or that the duties, obligations or liabilities of the other members of the Committee are decreased because of such designation. The Board will designate one member of the Committee to serve as the Chair of the Committee.
At all meetings of the Committee, one-half of the members of the Committee, but in no event less than two members of the Committee, shall constitute a quorum. As the Chair deems necessary, the Chair of the Committee may request members of the Company’s management, non-Committee member directors, internal or external counsel, and expert advisors retained by the Committee to be present at meetings.
The Committee shall meet as frequently as the Chair of the Committee deems advisable to fulfill the Committee’s responsibilities but not less often than three times per year. The Committee will report its actions to the next following meeting of the Board. The Committee will cause minutes to be kept of its meetings, copies of which will be furnished to Committee and other Board members. Except where otherwise expressly provided in the Company’s governing documents, the Committee shall be governed by the same rules regarding meetings as are applicable to the Board. The Committee may form and delegate authority to subcommittees when appropriate. The Committee shall annually review this Charter and recommend revisions to the Board, where appropriate. In addition to the responsibilities and duties enumerated below, the Committee shall perform such other duties as may be required by law, the Company’s governing documents, or the resolutions of the Board.
The Committee shall have the resources and authority necessary to discharge its responsibilities and duties, including the authority to obtain, at the Company’s expense, advice, reports or opinions from internal or external counsel and expert advisors.
Responsibilities and Duties
- Notwithstanding the terms of this Charter, it shall not be the duty of the Committee to plan or conduct audits or to determine that the Company’s financial statements are complete and accurate and are in accordance with generally accepted accounting principles, that being the responsibility of the Company’s management (“Management“) and the Company’s independent registered public accounting firm (“Independent Accountant“). The Independent Accountant shall report directly to the Committee in connection with issuing an audit report or related work.
- For purposes of issuing an audit report or related work, the Committee shall have sole authority to appoint the Independent Accountant; oversee and evaluate the work of the Independent Accountant; approve the compensation of the Independent Accountant; review and approve in advance all matters concerning audit and non-audit services proposed to be performed by the Independent Accountant; and review and approve any discharge of the Independent Accountant.
- Receive periodic written statements from the Independent Accountant regarding its independence and delineating all relationships between it and the Company, including fees for audit and non-audit services, and to discuss such statements with the Independent Accountant, in accordance with applicable statements of independence standards, law and regulations.
- Review with Management and the Independent Accountant the scope and general extent of the Independent Accountant’s proposed audit examinations and, where applicable, annual independent evaluation of the Company’s disclosure controls and internal controls.
- Upon completion of the annual audit, the Committee shall review with Management and the Independent Accountant the Company’s financial results for the year; where applicable, the results of the Independent Accountant’s evaluation of the Company’s disclosure controls and internal controls; and discuss with the Independent Accountant the matters relating to the annual audit required to be discussed by applicable statements on auditing standards, law and regulations.
- Discuss with the Independent Accountant matters relating to reviews by the Independent Accountant of the Company’s unaudited interim financial statements and periodic reports.
- Discuss with the Independent Accountant the quality of the Company’s financial accounting personnel and any relevant recommendations of the Independent Accountant.
- Review and approve all related party transactions.
- Review actual and potential conflicts of interest of Board members and Executive Officers of the Company, and refer to the Board for its consideration, the approval or prohibition of any involvement of such persons in such matters that may involve a conflict of interest or taking of a corporate opportunity.
- Annually review and approve a Committee report for inclusion in the Company’s proxy statement.
- Establish procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting, disclosure controls and auditing matters; establish such procedures pertaining to the Company’s Code of Business Ethics and Conduct ( the “Code of Ethics“); and the confidential anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters or Code of Ethics matters.
- The members of the Committee shall act as a Qualified Legal Compliance Committee to receive reports of material violations of the securities laws, breaches of fiduciary duty or similar material violations from legal counsel representing the Company and practicing before the SEC.
Revised February 27, 2012