About Kimball

Board Composition

A. Board Leadership Structure

The Board shall determine the leadership structure of the Board from time to time. The Board shall choose its Chairman based upon the Board’s view of what is in the best interests of the Company at any given point in time, based on the recommendation of the Compensation & Governance Committee. Therefore, the Board does not have a policy on whether the role of the Chairman and Chief Executive Officer should be separate or combined and, if it is to be separate, whether the Chairman should be selected from the non-employee directors or be an employee.

When the Chairman of the Board is not an independent director, the Board will elect a “Lead Independent Director” in order to monitor and support the relationship between the Board and the Chairman/CEO and ensure that the interests of the shareholders are served by the Board. The independent members of the Board shall select the Lead Independent Director. The Lead Independent Director shall be affirmed or replaced at the Reorganization Meeting held by the Board following the Annual Shareholder Meeting each year. The Lead Independent Director shall serve in that role for a maximum of three years.

The Lead Independent Director shall have the duties and responsibilities set out in the Corporate Governance Principles and as may be assigned from time to time by the Board or the Chairman. The Lead Independent Director’s responsibilities shall include:

  • presiding at all meetings of the Board, including executive sessions, when the Chairman is not present;
  • presiding over shareholder meetings when the Chairman is not present;
  • acting as liaison between the Chairman and independent directors, although direct communication between each director and the Chairman/CEO is encouraged;
  • assisting the Chairman with developing schedules and agendas for Board meetings and meetings of the independent directors;
  • leading the annual board and director performance evaluation process in conjunction with the Compensation and Governance Committee; and
  • assisting the Chairman with other Board matters as requested by the Chairman or the Board.

B. Size of Board

The Company's Articles of Incorporation require that the Board consist of between 7 and 15 members, the exact number being set by the Board of Directors as authorized under the By-laws. The Compensation & Governance Committee and the Board periodically review the appropriate size of the Board.

C. Director Independence

The exercise of independent judgment by the directors is critical to effective corporate governance. The majority of the directors on the Company's Board are classified as "Independent" in accordance with our stock exchange (NASDAQ) listing requirements. The Board shall affirmatively determine the independence of each non-employee director and consider all factors relevant in determining whether he or she has a relationship with the Company which is material to the director’s ability to be independent from management in the performance of his or her duties. In addition, a director will not qualify to serve on either the Company’s Audit Committee or Compensation & Governance Committee if the director is not independent in accordance with applicable NASDAQ requirements and the rules of the Securities and Exchange Commission.

D. Board Membership Criteria

The rapidly changing business conditions and markets in which the Company operates require a high-performance and committed Board. Expectations of our Board members include:

  • Personal integrity;
  • Commitment to the Company's Vision, and Guiding Principles;
  • Commonsense and practical and good judgment;
  • Broad and complementary experience and expertise in various areas such as finance and accounting, education, government, etc., such that the members can bring a diverse set of skills and backgrounds to bear on the complicated issues which come before it;
  • Prepare for, attend and participate in all Board and applicable committee meetings;
  • Commitment to serve over a period of time sufficient to understand the Company's history, markets, and business operations; and
  • Willingness to think independently and present reasoned points of view.

The Compensation & Governance Committee shall identify possible nominees who meet specified objectives in terms of the composition of the Board, taking into account the diversity of the nominees with respect to gender, race, national origin, education and professional experience.

E. Shareholder Board Member Recommendations

The Compensation & Governance Committee will consider candidates recommended by shareholders. A shareholder who wishes to recommend a director candidate for consideration by the Compensation & Governance Committee should send such recommendation to the Secretary of the Company at 1600 Royal Street, Jasper, IN 47549, who will forward it to the Committee. Any such recommendation should include a description of the candidate's qualifications for Board service, the candidate's written consent to be considered for nomination and to serve if nominated and elected, and addresses and telephone numbers for contacting the shareholder and the candidate for more information. A shareholder who wishes to nominate an individual as a director candidate at the annual meeting of shareholders, rather than recommend the individual to the Compensation & Governance Committee as a nominee, must comply with the advance notice requirements mandated by the Company's By-laws and further explained in the "Share Owner Proposals" section of its Proxy Statement.

F. Conflicts of Interest

A relationship by a Board member, or a member of his or her family, with a customer, supplier, or other relationship which may impair a director's ability to exercise independent judgment is prohibited.

G. Directors who Change Their Present Job Responsibility

The Board does not believe that directors who retire or change the position they held when they became a member of the Board should necessarily leave the Board. The Compensation & Governance Committee will review the continued appropriateness of Board membership under such circumstances.

H. Other Directorships and Committee Memberships

Directors are encouraged to limit the number of other public company boards on which they serve, taking into account potential board attendance, participation and effectiveness on these boards. Directors should advise the Chairman of the Board and the Chair of the Compensation & Governance Committee before accepting an invitation to serve on another public company board.

In addition, no member of the Company's Audit Committee or Compensation & Governance Committee may simultaneously serve on committees of more than two other public companies unless the Board has determined that service on the respective committees of other public companies will not impair that director's ability to effectively serve on the Company's Audit or Compensation & Governance Committee.

I. Majority Election of Directors

In any uncontested election of an individual director or a class of directors, if more proxy votes are “withheld” than are cast “for” in the election of an incumbent director, the director shall promptly tender his or her resignation to the Board of Directors.  The Compensation and Governance Committee of the Board of Directors (the “Committee”) shall be given 90 days after receipt of the resignation to consider whether to accept it and shall make a recommendation to the Board regarding same.  The Committee shall review relevant information, including factors relevant to why votes would have been withheld; the length of service, qualifications and skillsets of the director; the contributions by that director to the Company during his or her tenure; the Corporate Bylaws, Governance Principles, applicable laws and regulations; and any other relevant factors, to make their determination.  The Board shall review the recommendation of the Committee and render a decision within 30 days of receipt of the resignation, making such decision publicly known.  The impacted director(s) shall not participate in either the Committee review or the Board decision, but may participate in any scheduled Board meetings up to the point in time when a decision is made to accept or reject the resignation.  If the resignation is accepted, the director will immediately be removed from the Board.  The Compensation and Governance Committee shall then proceed with selection of a replacement in accordance with the Bylaws and Corporate Governance Principles. 

In the event that more proxy votes are “withheld” than cast “for” more than one director, resulting in the Committee not having a quorum for purposes of the necessary review, the independent directors of the Board shall conduct the review normally performed by the Committee.  The Committee and Board may adopt procedures appropriate to facilitate the review and determination required by this Policy.  “Uncontested” shall mean that the proxy election does not involve nominees for director who are not part of the slate of nominees recommended by the Board, and/or the number of nominees does not exceed the number of director positions to be filled at any given proxy election.  “Independent directors” are determined in accordance with requirements of NASDAQ, and shall consist only of those independent directors who received a majority of favorable votes cast, if they were part of the same proxy election.



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