Statement of Purpose

The Audit Committee (the "Committee") shall:

    1. provide assistance to the Company's Board in fulfilling its oversight responsibility to the shareholders, potential shareholders and investment community relating to:
      1. the accounting, reporting and financial practices of the Company, including the integrity of the Company's financial statements;
      2. the Company's compliance with legal and regulatory requirements;
      3. the independent auditor's qualifications and independence; and
      4. the performance of the Company's internal audit function and independent auditor; and
    2. prepare the report that Securities and Exchange Commission ("SEC") rules require to be included in the Company's annual proxy statement.


It is the responsibility of the Committee to maintain free and open communication between the directors, the independent auditor, internal audit and the management of the Company. In discharging its oversight role, 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 and the authority, without seeking the approval of the Board, to engage, at the Company's expense, independent counsel and other advisors as it determines necessary to carry out its responsibilities. To assist it in carrying out its responsibilities, the Committee may form and delegate authority to subcommittees consisting of one or more members when appropriate.

As part of its responsibilities, the Committee shall, consistent with and subject to applicable law and rules and regulations promulgated by the SEC, the New York Stock Exchange (the "NYSE") or other regulatory authorities:

    1. Appoint and retain (subject to shareholder approval) or terminate, when appropriate, a firm of independent certified public accountants to serve as the independent auditor of the Company, which firm shall report directly to the Committee. In its capacity as a committee of the Board, the Committee shall be directly responsible for the appointment, compensation and oversight of the independent auditor.
    2. Approve in advance all audit engagement fees and terms of all audit services to be performed by the independent auditor. By approving the audit engagement, the audit services shall be deemed to have been pre-approved.
    3. Establish policies and procedures for the engagement of the independent auditor to provide permissible non-audit services, which shall require pre-approval by the Committee of all permissible non-audit services to be provided by the independent auditor.
    4. Obtain and review, at least annually, a report by the independent auditor describing:
      1. the independent auditor's internal quality-control procedures;
      2. any material issues raised within the preceding five years by the internal quality-control reviews, or peer reviews, of the firm, or by any inquiry or investigation by governmental or professional authorities, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues; and
      3. all relationships between the independent auditor and the Company.
    5. Oversee the regular rotation of the lead and concurring partners of the independent auditor as required by law and consider any regular rotation of the audit firm itself.
    6. Review and evaluate annually the qualifications, performance and independence of the independent auditor and the lead and concurring partners of the independent auditor, including considering whether the auditor's quality controls are adequate and the provision of permitted non-audit services is compatible with maintaining the auditor's independence. This evaluation shall take into account the opinions of management and the internal auditors.
    7. Review and discuss with the independent auditor:
      1. the scope of the audit, the results of the annual audit examination by the independent auditor, and any difficulties the independent auditor encountered in the course of its audit work, including any restrictions on the scope of the independent auditor's activities or on access to requested information, and any significant disagreements with management; and
      2. any reports of the independent auditor with respect to interim periods.
    8. Review and discuss with the independent auditor and management the annual audited and quarterly financial statements of the Company, including:
      1. the auditor's judgment about the quality, not just the acceptability, of accounting principles, the reasonableness of significant judgments, and the clarity of the disclosures in the Company's financial statements;
      2. the Company's disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations," including accounting policies that may be regarded as critical;
      3. any major issues regarding the adequacy of the Company's internal controls or the Company's accounting principles and financial statement presentations, including any significant changes in the Company's selection or application of accounting principles and internal controls;
      4. analyses prepared by management and/or the independent auditor setting forth significant financial reporting issues and judgments made in connection with preparation of the financial statements, including analyses of the effects of alternative GAAP methods on the financial statements;
      5. types of information to be disclosed and the type of presentation to be made in the Company's earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies;
      6. the effect of regulatory and accounting initiatives on the financial statements.
    9. Recommend to the Board, based on the review and discussions described in paragraphs (vii) and (viii), whether the financial statements should be included in the Annual Report on Form 10-K.
    10. Review the Company's accounting policies and practices in light of the requirements of the Financial Accounting Standard Board, the SEC, the Public Company Accounting Oversight Board and the American Institute of Certified Public Accountants. The Committee shall review at least annually the Company's description of its critical accounting policies. Any significant changes in these policies must be approved in advance by the Committee.
    11. Discuss with the Company's General Counsel legal matters that may have a material impact on the financial statements, the Company's compliance policies, and any material reports, inquiries or correspondence received from regulators or government agencies, which raise material issues regarding the Company's financial statements or accounting policies.
    12.  Obtain and review, prior to each meeting, a summary of internal audit reports completed and in process, and a progress report on the internal audit plan.
    13.  Review, with the input of the independent auditor, the performance of the internal audit function of the Company, including the independence and authority of its reporting obligations, the reasonableness of the proposed internal audit plan for the coming year, the coordination of the internal audit plan with the independent auditor, and the adequacy of staffing and budget to accomplish the internal audit plan.
    14.  Meet periodically and separately with the independent auditor, internal audit and management to review and discuss the adequacy and effectiveness of the internal controls of the Company (with particular emphasis on the scope and performance of the internal audit function).
    15. Review and discuss the Company's disclosure controls and procedures with the independent auditor, internal audit and management.
    16.  Establish policies for the hiring of employees or former employees of the independent auditor.
    17.   Review and discuss with management the Company's most significant financial risks, methods of risk assessment, risk mitigation strategies and the overall effectiveness of the Company's guidelines, policies and systems with respect to risk assessment and management, including policies and procedures for derivative and foreign exchange transactions and insurance coverage.
    18.   Establish and review procedures for the handling of complaints received by the Company regarding accounting, internal controls or audit matters, including procedures for the confidential, anonymous submission of legitimate concerns by employees regarding any questionable accounting, internal controls or audit matters.
    19.  Prepare the Committee's report to be included in the Company's annual report and/or proxy statement, as required by the Securities Exchange Act of 1934.
    20.  Obtain reports from management annually regarding the Company's codes of conduct and ethics.
    21.  Conduct an evaluation of the Committee's performance, at least annually, to determine whether it is functioning effectively.
    22.   Review the adequacy of this Charter and recommend any changes to the Board.
    23.    Report regularly to the full Board with respect to the Committee's performance of its responsibilities under this Charter.


While the Committee has the responsibilities and powers set forth in this Charter, it is not 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 and applicable rules and regulations. These are the responsibilities of management and the independent auditor. Nor is it the duty of the Committee to conduct investigations, to resolve disagreements, if any, between management and the independent auditor or to assure compliance with laws and regulations and the Company's business ethics and code of conduct.


The Committee shall consist of at least three directors, all of whom shall be "independent directors." For purposes hereof, an "independent director" means a director who satisfies the "independence" requirements of the NYSE and SEC. Each member of the Committee must be financially literate, as determined in the Board's judgment, and at least one member of the Committee must be an "audit committee financial expert," as defined in rules promulgated by the SEC. The Board shall designate one member as the Chair.

If a member of the Committee simultaneously serves on the audit committee of more than two other public companies, the Board must determine that such simultaneous service would not impair the ability of such member to effectively serve on the Committee and must disclose such determination in the annual report and proxy statement. The members of the Committee shall be appointed annually by the Board at its May meeting. The Board may replace Committee members at any time.


The Committee shall meet quarterly, prior to the regular meetings of the Board. The Committee shall meet more frequently to the extent deemed necessary or appropriate by its members. The Committee shall meet separately in executive sessions, periodically, with each of management, the principal internal auditor of the Company and the independent auditor. At each regular meeting of the Board, the Committee shall report to the full Board with respect to the Committee's meetings and activities. A majority of the Committee shall constitute a quorum for conducting business. The Committee shall maintain minutes and other relevant documentation of all its meetings.