Board Committee Charter

Introduction

The Compensation Committee of the Board of Directors (the "Committee") of DayStar Technologies, Inc. (the "Company") has the responsibility to develop criteria and goals for, and review and approve, the compensation of the Company's officers and directors, including but not limited to, management incentive and employee incentive programs . The Committee also develops and establishes equity and other benefit plans, and reviews and establishes director compensation.

Membership

The Committee is composed of a minimum of three independent (as defined by applicable laws, regulations, and listing requirements) non-employee, outside (as defined by Rule 16b of the Securities and Exchange Act of 1934 and Section 162(m) of the Internal Revenue Code) directors as appointed by the Board of Directors. The Board may designate one or more independent directors as alternate members of the Committee, who may replace any absent or disqualified member or members at any meetings of the Committee.

Operations

The Committee meets at least three times each year. The Committee will, at its discretion, meet at each regularly scheduled meeting in executive session without Company management present. Meetings and actions of the Committee will be governed by, and held and taken in accordance with, the provisions of Section 4.5 of the Company's Amended and Restated Bylaws. The Chairperson of the Committee shall be responsible for leadership of the Committee, including preparing the agenda, presiding over Committee meetings, making Committee assignments and reporting the Committee's actions to the Board. The Committee shall keep written minutes of its meetings, which shall be recorded or filed with the books and records of the Company. Any member of the Board shall be provided with copies of such Committee minutes if requested. The Company's President or Chief Executive Officer will not be present at any meeting in which deliberations or voting on the President and Chief Executive Officer's compensation takes place.

Authority

The Committee will have the resources and authority necessary to discharge its duties and responsibilities. The Committee has the sole authority to retain, compensate and terminate consultants, legal counsel and other advisors to assist the Committee in fulfilling its responsibilities, including the authority to negotiate and approve the fees and retention terms. The Committee shall have authority to delegate responsibilities listed herein to subcommittees of the Committee if the Committee determines such delegation would be in the best interest of the Company. The Committee may ask members of management or others whose advice and counsel are relevant to address the issues then being considered by the Committee. Any communications between the Committee and legal counsel in the course of obtaining legal advice will be considered privileged communications of the Company and the Committee will take all necessary steps to preserve the privileged nature of those communications.

The Compensation Committee, in order to assist the Board in the discharge of its fiduciary responsibilities relating to the compensation of the executives and other key employees of the Company, will:

  1. Review and approve the Company's compensation policies;
  2. Review and approve the Company's incentive compensation program, plans and awards;
  3. Administer the Company's incentive plans and other stock or stock-based plans;
  4. Review and recommend for approval by the Board general employee compensation and benefit plans on an as-needed basis; and
  5. Undertake such other specific duties as the Board of Directors may from time-to-time prescribe.

Responsibilities

The principal responsibilities of the Committee include:

  1. Periodically reviewing and approving compensation to be awarded to the Chief Executive Officer and other officers. Periodically assessing whether total compensation paid to the Company's principal officers and other key employees is reasonable to ensure (a) the attraction and retention of executives, (b) the motivation of executives to achieve the Company's long-term business objectives, and (c) the alignment of the interests of key leadership with the long-term interests of the Company's shareholders.
  2. Assist the Board in establishing CEO annual goals and objectives, and consider the results of the CEO performance review conducted by the Nominating and Governance Committee in recommending CEO compensation to the other independent members of the Board for approval and consistent with the Company's compensation plan. Review, approve and evaluate achievement of performance goals and objectives by the Chief Executive Officer and other officers in connection with these officers' cash and equity compensation.
  3. Review trends in executive compensation, oversee the development of new compensation plans, and when necessary, approve the revision of existing plans.
  4. Make recommendations to the Board of Directors with respect to amendments to the Equity Incentive Plans and Management Incentive Plans of the Company and changes in the terms, vesting, qualifications and number of shares reserved for issuance thereunder.
  5. Review and approve compensation packages for new executive officers and termination packages for executive officers.
  6. Establish, administer and review compensatory benefit plans for executive officers and directors.
  7. Recommend Board or stockholder approval of incentive compensation and equity-based plans.
  8. Periodically review the compensation paid to non-employee directors and make recommendations to the Board for any adjustments. No member of the Committee will act to fix his or her own compensation except for uniform compensation to directors for their services as directors.
  9. Monitor the regulatory compliance of the Equity Incentive Plan, or any other benefit plan.
  10. Prepare, review and approve public disclosure related to compensation of Company executives.
  11. Prepare reports conforming to the Securities and Exchange Commission's requirements, to be included as the Committee's annual executive compensation report in the Company's proxy statement filed with the SEC.
  12. Obtain or perform an annual evaluation of the Committee's performance and make applicable recommendations.