Corporate Governance Guidelines of Teledyne Technologies Incorporated
Amended and Restated as of December 16, 2014
The following Corporate Governance Guidelines have been adopted by the Board of
Directors (the “Board”) of Teledyne Technologies Incorporated (the “Company”) to
assist the Board in the exercise of its responsibilities. These Corporate Governance
Guidelines reflect the Board’s commitment to monitor the effectiveness of policy
and decision making both at the Board and management levels, with a view to enhancing
long-term stockholder value. These Corporate Governance Guidelines are not intended
to change or interpret any Federal or state law of regulation, including the Delaware
General Corporation Law, or the Certificate of Incorporation or the Amended and
Restated Bylaws of the Company. These Corporate Governance Guidelines are subject
to modification from time to time by the Board.
Role of Directors
A Director is expected to spend the time and effort necessary to discharge properly
Directors' responsibilities. Accordingly, a Director is expected to attend regularly
meetings of the Board and committees on which such Director sits, and to review
prior to meetings material distributed in advance for such meetings. A Director
who is unable to attend a meeting should notify the Chairman of the Board as soon
as possible in advance of such meeting.
The Board's Goals
The Board's goals are to build long-term value for the Company's stockholders and
to assure the vitality of the Company for its customers, employees and the other
individuals and organizations that depend on the Company.
To achieve these goals the Board will monitor both the performance of the Company
(in relation to its goals, strategy and competitors) and the performance of the
Chief Executive Officer, and offer him or her constructive advice and feedback.
When it is appropriate or necessary, it is the Board's responsibility to remove
the Chief Executive Officer and to select his or her successor.
Selection of the Chairman of the Board
The Board does not require the separation of the offices of the Chairman of the
Board and the Chief Executive Officer. The Board shall be free to choose its Chairman
of the Board in any way that it deems best for the Company at any given point in
Size of the Board
The Amended and Restated Bylaws of the Company provide for no fewer than four and
no more than twelve Directors. This range permits diversity of experience without
hindering effective discussion or diminishing individual accountability. The size
of the Board could, however, be increased or decreased if determined to be appropriate
by the Board. For example, it may be desirable to increase the size of the Board
in order to accommodate the availability of an outstanding candidate for Director.
Selection of New Directors
The Board shall be responsible for nominating members for election to the Board
and for filling vacancies on the Board that may occur between annual meetings of
stockholders. The Board delegates the search and recommendation process involved
to the Nominating and Governance Committee. When formulating its Board membership
recommendations, the Nominating and Governance Committee shall also consider advice
and recommendations from the Chief Executive Officer and others, as it deems appropriate.
The Nominating and Governance Committee will consider suggestions timely submitted
by the Company's Stockholders. The invitation to join the Board should be extended
by the Chair of the Nominating and Governance Committee and the Chief Executive
Board Membership Criteria
Nominees for Director shall be selected on the basis of, among other criteria, experience,
knowledge, skills, expertise, integrity, diversity, ability to make independent
analytical inquiries, understanding of, or familiarity with, the Company's business
products or markets or similar business products or markets and willingness to devote
adequate time and effort to Board responsibilities.
The Nominating and Governance Committee may establish additional criteria and shall
be responsible for assessing the appropriate balance of criteria required of Board
Each Director shall be expected, within a reasonable period of time following his
or her election to the Board, to own stock in the Company in an amount that is appropriate
for such Director's financial circumstances. However, the ownership of a substantial
amount of stock is not in itself a basis for a Director to be considered as not
Other Public Company Directorships
Any Director who is considering accepting an invitation to join the Board of Directors
of any other business corporation (whether publicly or privately held) shall notify
the Chief Executive Officer and the Chair of the Nominating and Governance Committee
in advance of accepting such invitation so as to enable the Nominating and Governance
Committee, together with the General Counsel, to make, in a timely manner, a determination
as to whether there is an 'interlocking Directorate' issue or other conflict and
communicate such determination, and any related recommendation, to such Director
and to the Board.
Independence of the Board
The Board will be composed of a majority of Directors who qualify as independent
directors ("Independent Directors") under the listing standards of the New York
Stock Exchange (the "NYSE"). The Board shall review annually the relationships that
each Director has with the Company (either directly or as a partner, shareholder
or officer of an organization that has a relationship with the Company). Following
such annual review, only those Directors who the Board affirmatively determines
have no material relationship with the Company (either directly or as a partner,
shareholder or officer of an organization that has a relationship with the Company)
will be considered Independent Directors, subject to additional qualifications prescribed
under the listing standards of the NYSE or under applicable law. The Board may adopt
and disclose categorical standards to assist it in determining Director independence.
Separate Sessions of Non-Management Directors/Independent Directors; Lead Director
The non-management Directors of the Company shall meet in executive session without
management on a regularly scheduled basis, and the Independent Directors (to the
extent different from the non-management Directors) shall meet at least once per
The Board has formally designated an Independent Director to serve as the lead Director.
The lead Director shall preside in those executive sessions where the non-management
or Independent Directors meet without the Chief Executive Officer.
Any interested parties desiring to communicate with non-management or Independent
Directors regarding the Company may directly contact such Directors through the
Directors Who Change Their Present Job Responsibility (Professional Status)
Any Director who experiences a change in his or her principal occupation or primary
business affiliation from that in which the Director was engaged when last elected
to the Board should promptly notify the Secretary of such change. The Secretary
shall in turn notify the Nominating and Governance Committee. The Board, with input
from the Nominating and Governance Committee and the Chairman, will consider whether
the Director should be requested to tender his or her resignation based on consideration
of the best interest of the Company in light of the circumstances, including the
effect such change in occupation or primary business affiliation may have on that
Director's ability to serve and to be an effective Board member. If such a request
is made, the Director shall promptly tender his resignation. For this purpose, retirement
is considered a change of employment.
Director Resignation Policy for Incumbent Directors in Uncontested Elections
The Amended and Restated Bylaws of the Company provide for majority voting in the
election of Directors in uncontested elections (i.e., an election where the number
of nominees does not exceed the number of Directors to be elected). The Board has
adopted a policy whereby all Director nominees must submit a contingent resignation
in writing to the Chairman of the Nominating and Governance Committee. The resignation
becomes effective only if the Director is not elected by a majority of votes cast
and the Board accepts the resignation. The Nominating and Governance Committee or
another committee appointed by the Board will recommend to the Board whether to
accept or reject the resignation or whether other action should be taken. The Board
will act on such committee’s recommendation and publicly disclose its decision and
the rationale behind it within 90 days following the date of the certification of
the election results. The Director who was not elected by a majority of votes cast
will not participate in the Board’s decision with respect to such resignation.
The Board of Directors of the Company established the rule that any Director who
has attained the age of 75 shall retire at the Annual Meeting immediately following
the Director's 75th birthday. Additionally, no person shall be nominated to stand
for election to, nor be elected to fill a vacancy on, the Board of Directors if
such election would take place after such person has attained age 75. The Board
of Directors may grant exceptions in special circumstances.
In connection with each Director nomination recommendation, the Nominating and Governance
Committee shall consider the issue of continuing Director tenure and take steps
as may be appropriate to ensure that the Board maintains an openness to new ideas
and a willingness to critically re-examine the status quo.
Prior to the renomination of any incumbent Director, the Nominating and Governance
Committee shall consider such Director's: (1) change in position of principal employment
by retirement or otherwise and the concomitant effect such change shall have on
the incumbent's ability to continue to make meaningful contributions to the Board;
(2) attendance record for Board and Committee meetings during the Director's term;
and (3) health, as a possible impediment to continued active involvement as a Director.
A Director who is also an officer of the Company shall not receive additional compensation
for such service as a Director.
The Company believes that compensation for non-employee Directors should be competitive
and should encourage increased ownership of the Company's stock through the payment
of a portion of Director compensation in Company stock, options to purchase Company
stock or similar compensation. The Nominating and Governance Committee will periodically
review the level and form of the Company's Director compensation, including how
such compensation relates to Director compensation of companies of a comparable
size, industry and complexity. Changes to Director compensation will be proposed
to the full Board for consideration.
The Nominating and Governance Committee shall administer any plans or rules relating
Non-Employee Director compensation, including the Administrative Rules Relating
to Non-Employee Director Restricted Stock Unit Awards and Fees.
Self-Evaluation by the Board and Committees
The Board and each Committee shall assess annually its respective performance, in
such manner as recommended by the Nominating and Governance Committee. The assessment
should include a review of any areas in which the Board or management believes the
Board or any Committee can make a better contribution to the Company.
Board Access to Management
Board members shall have access to the Company's management and, as appropriate,
to independent advisors. It is assumed that Board members will use judgment to be
sure that this contact is not distracting to the business operation of the Company.
Attendance of Management Personnel at Board Meetings
The Board encourages the Chief Executive Officer to bring members of management
from time to time into Board meetings to (i) provide management insight into items
being discussed by the Board which involve the manager's business; (ii) make presentations
to the Board on matters which involve the manager's business; and (iii) bring managers
with significant leadership and other potential into contact with the Board.
Board Materials Distributed in Advance
Information and data which are important to the Board's understanding of the business
will be distributed in writing to the Board before the Board meets. In the event
of a pressing need for the Board to meet on short notice or if such materials would
otherwise contain highly confidential or sensitive information, it is recognized
that written materials may not be available in advance of the meeting.
Reliance on Management and Outside Advice
In performing its functions, the Board is entitled to rely on the advice, reports
and opinions of management, counsel, accountants, auditors and other expert advisors.
The Board shall have authority to retain and approve the fees and retention terms
of its outside advisors.
Board Interaction with Institutional Investors, Analysts, Press and Customers
The Board believes that management generally should speak for the Company. It is
suggested that each Director shall refer all inquiries from institutional investors,
analysts, the press or customers to the Chief Executive Officer or his or her designee.
The Company's Senior Vice President – Strategy and Mergers & Acquisitions will report
to the Board annually, and more frequently if appropriate, the results of communications
with the Company's various stockholder constituencies and analysts and rating agencies.
Board Orientation and Continuing Education
The Company shall provide new Directors with a Director orientation program to familiarize
such Directors with, among other things, the Company's business, strategic plans,
significant financial, accounting and risk management issues, compliance programs,
conflicts policies, code of business conduct and ethics, corporate governance guidelines,
internal auditors and independent auditors. Continuing education programs for Directors
may include a combination of internally developed materials and presentations, programs
presented by third parties at the Company, and financial and administrative support
for attendance at certain qualifying independent programs.
Frequency of Meetings
There shall be at least five regularly scheduled meetings of the Board each year.
At least one regularly scheduled meeting of the Board shall be held quarterly.
Selection of Agenda Items for Board Meetings
The Chairman of the Board will establish the agenda for each Board meeting. Each
Board member is free to suggest the inclusion of items on the agenda. Each Board
member is free to raise at any Board meeting subjects that are not on the agenda
for that meeting.
At least one Board meeting each year will be devoted to a review of the long-term
strategic plans and the principal issues that the Company may face in the future.
Number and Names of Board Committees
The Company shall have three standing committees: Audit, Nominating and Governance,
and Personnel and Compensation. The purpose and responsibilities for each of these
committees is outlined in committee charters adopted by the Board. The Board has
the flexibility to form a new committee or disband a current committee at any time.
Independence of Board Committees
Each of the Audit Committee, the Nominating and Governance Committee and the Personnel
and Compensation Committee shall be composed entirely of Independent Directors satisfying
applicable legal, regulatory and stock exchange requirements necessary for an assignment
to any such committee.
Audit Committee Memberships
No director may serve as a member of the Audit Committee if such director serves
on the audit committees of more than two other public companies unless the Board
determines that such simultaneous service would not impair the ability of such director
to effectively serve on the Audit Committee, and discloses this determination in
the Company’s annual proxy statement.
Assignment and Rotation of Committee Members
The Nominating and Governance Committee shall be responsible for making recommendations
to the Board with respect to the assignment of Board members to various committees
(after taking into account the desires of the individual Board members and the suggestions
of the Chief Executive Officer). After reviewing the Nominating and Governance Committee's
recommendations, the Board shall be responsible for appointing the Chairman and
members to the committees on an annual basis.
The Nominating and Governance Committee shall annually review the Committee assignments
and shall consider the rotation of the Chair and members with a view toward balancing
the benefits derived from continuity against the benefits derived from the diversity
of experience and viewpoints of the various Directors.
Note: It is the sense of the Board that consideration should be given to rotating
committee members periodically at about a 6-year interval, but the Board does not
feel that such a rotation should be mandated as a policy as there may be reasons
at a given point in time to maintain an individual Director's committee membership
for a longer period or shorter period.
Selection of the Chief Executive Officer
The Board shall be responsible for identifying potential candidates for, and selecting,
the Company's Chief Executive Officer. The Board shall consider, among other things,
a candidate's experience, understanding of, or familiarity with, the company's businesses
products and markets, leadership qualities, knowledge, skills, expertise, integrity,
and reputation in the business community.
Evaluation of Chief Executive Officer
The Board will provide the Chief Executive Officer with an annual performance review
for the prior year. The following steps will be utilized to carry out this review:
At the beginning of each fiscal year the Personnel and Compensation Committee of
the Board, in collaboration with the Chief Executive Officer, will set annual performance
goals for the Chief Executive Officer.
The Chief Executive Officer will develop a self-evaluation at the end of each fiscal
year and provide this to the Personnel and Compensation Committee of the Board.
- With this information, the Personnel and Compensation Committee will solicit input
from the other Board Members. This assessment should include the Directors' appraisal
The Company's performance and the Chief Executive Officer's contribution to it,
both compared to competitors and the Company's own strategic goals;
Achievement of personal goals established for the Chief Executive Officer for the
Other aspects of the Chief Executive Officer's performance which the Director deems
The Personnel and Compensation Committee will synthesize this information and report
a summary of this information to the Directors in executive session. After agreement
by the Directors to the evaluation, the chair of the Personnel and Compensation
Committee will meet with the Chief Executive Officer to discuss the Board's assessment.
The Chief Executive Officer may then take the opportunity to discuss his or her
reaction to the evaluation.
At least annually, the Personnel and Compensation Committee, together with the Chief
Executive Officer, will report to the Board on succession planning, including plans
for interim succession for the Chief Executive Officer in the event of an unexpected
At least annually the Personnel and Compensation Committee, together with the Chief
Executive Officer, will review with the Board the Company's program for management