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Corporate Governance - Committee

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Audit Committee Charter

Standing Resolution Adopted by
The Board of Directors -- Regular Meeting
December 8, 2010

RESOLVED THAT: Pursuant to Section 23 of the company’s bylaws, the board of directors hereby adopts the following charter for the Audit Committee ("Committee") of the board of directors. This charter shall govern the Committee's scope of responsibility and actions:

1. Purpose: The board established this Committee to oversee the company's accounting and financial reporting processes, system of internal controls, audits of the company's financial statements, and the integrity of the company’s financial statements. The Committee shall also assist the board in the oversight of the company's compliance with legal and regulatory requirements; the independence, performance, and qualifications of the independent auditor; and the performance of the company's internal audit function.

2. Committee Membership: The Committee shall consist of at least five members. All members of the Committee shall meet the independence requirements for Committee members as established by the New York Stock Exchange. The members of the Committee shall be appointed by the board on the recommendation of the Governance and Nominating Committee and may be removed by the board in its discretion. All members must be financially literate, which means that they shall have sufficient financial experience and ability to enable them to discharge their responsibilities and at least one member of the Committee must be a financial expert, as that term is defined by the Securities and Exchange Commission. No member of the Committee may serve on more than two other public company audit committees.

3. Committee Authority and Responsibilities. The Committee shall:

3.1 Discuss with management and the independent auditor the annual audited financial statements and quarterly financial statements, including matters required to be reviewed under applicable legal, regulatory, or New York Stock Exchange requirements, and recommend to the board whether the audited financial statements should be included in the company’s Form 10-K;

3.2 Discuss with management and the independent auditor, as appropriate, earnings press releases, analyst and rating agency guidance, and other financial information provided to the public;

3.3 Recommend, for shareholder approval, the independent auditor to examine the company's accounts, controls, and financial statements and consider whether there should be rotation of the independent auditor. The Committee shall have the sole authority and responsibility to select, terminate, and determine the compensation of the independent auditor. The independent auditor shall report directly to the Committee and the Committee shall be directly responsible for oversight of the work of the independent auditor, including resolution of disagreements between company management and the independent auditor regarding financial reporting. The Committee shall annually consider any partner rotation requirements and shall review the experience and qualifications of any lead partner of the independent auditor newly assigned to the company’s audit. The Committee shall meet with the independent auditor annually prior to the audit to discuss and review the scope, planning and staffing of the audit. The Committee or an authorized Committee member must preapprove any audit and permitted nonaudit service provided to the company by the company's independent auditor;

3.4 Discuss with management and the independent auditor, as appropriate, any audit problems or difficulties and management's response and the company's risk assessment and risk management policies, including the company's major financial risk exposure and steps taken by management to monitor and mitigate such exposure;

3.5 Review with the independent auditors and management:
(a) the company's financial reporting, accounting standards and principles, and critical accounting policies and practices;
(b) significant changes in such standards, principles, policies or practices, or in their application;
(c) the key accounting decisions affecting the company's financial statements, including alternatives to, and the rationale for, the decisions made, and the treatment preferred by the independent auditor;
(d) the information required to be disclosed to the company by its independent auditors and other material written communications between the independent auditor and management;
(e) the effect of regulatory and accounting initiatives, as well as proposed off-balance-sheet structures, on the financial statements of the company;

3.6 Review, and approve if required, the following periodically with respect to the internal corporate audit staff function:
(a) purpose, authority, and organizational reporting lines;
(b) the appointment, replacement, reassignment or dismissal of the senior internal auditing executive;
(c) annual audit plan, budget, and staffing;
(d) internal audit charter;
(e) reports on completed audits, including management response and status of audits in process and planned.
(f) any significant difficulties, disagreements with management, or scope restrictions encountered in the course of the functions’ work; and
(g) reports of any material irregularities encountered in the course of the functions’ work or fraud regarding unauthorized access to company assets;

3.7 Review, with the chief financial officer, the controller, the senior internal auditing executive, or such others as the Committee deems appropriate, (a) the company's internal system of audit, financial, and disclosure controls; (b) the scope of the internal and independent auditors’ review of internal control over financial reporting and obtain reports on significant findings and recommendations, together with management responses; and (c) major issues as to the adequacy of the company’s internal controls and any special audit steps adopted in light of any significant deficiencies identified;

3.8 Obtain and review at least annually a written report from the independent auditor delineating: the auditing firm's internal quality-control procedures; any material issues raised within the preceding five years by the auditing firm's internal quality-control review, by peer reviews of the firm, or by any governmental or other inquiry or investigation relating to any audit conducted by the firm. The Committee will also review steps taken by the auditing firm to address any findings in any of the foregoing reviews. Also, to assess auditor independence and the absence of conflicts of interest, the Committee will review at least annually all relationships between the independent auditor and the company;

3.9 Prepare and publish an annual Committee report in the company's proxy statement;

3.10 Set policies for hiring employees or former employees of the company's independent auditor;

3.11 Oversee the Company’s ethics and compliance program by ensuring the board receives periodic reports on compliance matters and, at least annually, meeting independently with the chief compliance officer and/or the director of corporate compliance to review the ethics and compliance program and its effectiveness. In addition, the Committee reviews any significant recommendations from the Company’s independent registered public accountant and internal auditors concerning ethics and compliance. Both the chief compliance officer and the director of corporate compliance have direct access to the Committee to report any matter that, in their discretion, should be brought to the attention of the Committee.

3.12 Review and investigate matters pertaining to the integrity of management, including conflicts of interest or adherence to codes of ethics as required in the policies of the company. In connection with these reviews, the Committee will meet, as deemed appropriate, with the general counsel, chief compliance officer, director of corporate compliance and other company officers and employees;
3.13 Establish procedures concerning the submissions, receipt, retention, and treatment of complaints and concerns regarding accounting, internal accounting controls, or audit matters; and

3.14 Discuss with management and the independent auditors any correspondence between the company and regulators or governmental agencies and any associate complaints or published reports that raise material issues regarding the company’s financial statements or accounting policies.

3.15 Receive quarterly reports detailing all hedging activities and pre-approve hedging transactions or categories of hedging transactions if they constitute swaps under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

4. Committee Procedure:

4.1 The Committee shall review and reassess this charter annually and recommend any proposed changes to the board.

4.2 The Committee will meet as often as necessary, but not less than quarterly, to carry out its responsibilities. The Committee shall meet separately with management, with the corporate audit staff, and with the company's independent auditors. The meetings may be called by the Committee chair, the chairman of the board, or the CEO.

4.3 The Committee shall keep minutes and shall report Committee activities to the board.

4.4 The Committee shall annually review its own performance.

4.5 The Committee shall have the authority to retain any accounting firm to assist it in the carrying out of its responsibilities and shall have sole authority to approve the firm's fees and the other terms and conditions of the firm's retention. The Committee shall also have the authority to obtain advice and assistance from internal or external legal, accounting, or other advisors as it deems appropriate and shall have sole authority to approve the advisor’s fees and the other terms and conditions of the advisor’s retention. The Committee is empowered, without further action by the board of directors, to cause the company to pay the compensation of any such accounting firm or advisor as well as the ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties.

4.6 The Committee is empowered to investigate any matter brought to its attention with full access to all books, records, facilities, and personnel of the company.

4.7 This standing resolution will remain in effect until it is duly modified or rescinded. This supersedes all prior board or committee resolutions with respect to this subject matter.

Committee Members
Committee MemberWarren Bryant
Committee MemberJoseph DePinto
Committee MemberWilliam Montgoris
ChairpersonFrancesca Ruiz de Luzuriaga
Committee MemberDavid M. Szymanski
Audit Committee Charter