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Qualified Legal Compliance Committee Charter

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Purpose of Committee

The Qualified Legal Compliance Committee (the "QLCC") of Majestic Capital, Ltd. (the "Company") is appointed by the Board of Directors (the "Board") to receive, review, investigate and take any appropriate actions concerning any report by an attorney employed or retained by the Company or its subsidiaries of a material Company violation of U.S. federal or state laws or a material breach of a fiduciary duty arising under U.S. federal or state law.

Committee Membership

The Audit Committee of the Company shall serve as the QLCC, in accordance with the U.S. Securities and Exchange Commission's (the "SEC") rules implementing Standards of Professional Conduct for Attorneys under Section 307 of the Sarbanes-Oxley Act. 17 CFR Part 205 ("Part 205"). The QLCC will be composed entirely of directors who satisfy the definition of "independent" under the SEC and the listing standards of NASDAQ. The chair of the Audit Committee shall serve as the chair of the QLCC. As per SEC Final Rule: Implementation of Standards of Professional Conduct for Attorneys, Release Nos. 33-8185; 34-4726; IC-25919; File No. S7-45-02, "the Commission encourages issuers to adopt a QLCC as a means of effective corporate governance [and t]he Commission does not intend service on a QLCC to increase the liability of any member of a Board of Directors under state law and, indeed, expressly finds that it would be inconsistent with the public interest for a court to so conclude."

Meetings

The QLCC shall meet at least annually and as often as it determines is appropriate to carry out its responsibilities under this charter. The QLCC is authorized to retain outside attorneys and other experts or consultants as necessary to perform its duties under this charter.

Committee Responsibilities

The QLCC has the authority and responsibility for the following:



  1. The QLCC shall adopt written procedures for the confidential receipt, retention and investigation of any report of evidence of a material violation under Part 205.


  2. Where the report has not been initiated by the Company's Chief Legal Officer ("CLO"), either of his own report or through the anonymous incident report hotline ("The Network"), upon receipt of a report, the QLCC shall inform the Company's Chief Legal Officer ("CLO") and Co-Chief Executive Officers ("Co-CEOs") of the report.


  3. The QLCC shall determine whether an investigation of evidence of a material violation is necessary. In making this determination, the QLCC shall consider whether a material violation has occurred, is ongoing, or is about to occur. If the QLCC determines that an investigation is necessary, it shall (i) initiate such investigation, which may be conducted by the CLO or outside attorneys and (ii) retain such expert personnel as the committee deems necessary to conduct such an investigation.


  4. At the conclusion of an investigation and where the QLCC has found that a material violation has occurred, is ongoing, or is about to occur, the QLCC shall (i) recommend, by majority vote, that the issuer take appropriate action and (ii) inform the CLO and Co-CEOs and the Board of Directors of the results of the investigation and the appropriate actions, if any, which must be taken to remedy the violation.


  5. In the event that the Company fails in any material respect to take the appropriate recommended action, the QLCC is vested with the authority to take other appropriate action, including notification to the SEC.

Performance and Charter Evaluation

The QLCC shall review this charter and make any recommendations for changes in the charter to the Board of Directors.

[Adopted May 9, 2006]


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