ADT 2011 Annual Report Download - page 48

•do not serve as, nor does any immediate family member serve as, an executive officer of any
entity with respect to which the Company’s annual sales to, or purchases from, exceed 1% of
either entity’s annual revenues for the prior fiscal year;
• do not serve, nor does any immediate family member serve, on either the board of directors or
the compensation committee of any corporation that employs either a nominee for Director or a
member of the immediate family of any nominee for Director; and
• do not serve, nor does any immediate family member serve, as a director, trustee, executive
officer or similar position of a charitable or non-profit organization with respect to which the
Company or its subsidiaries made charitable contributions or payments in excess of 1% of such
organization’s charitable receipts in the last fiscal year. In addition, a Director is not
independent if he or she serves as a director, trustee, executive officer or similar position of a
charitable organization if Tyco made payments to such charitable organization in an amount that
exceeds 1% of Tyco’s total annual charitable contributions made during the last fiscal year.
The Board has determined that all of the Director nominees, with the exception of the Chief
Executive Officer, meet these standards and are therefore independent of the Company. The
independent Director nominees are Timothy M. Donahue, Brian Duperreault, Bruce S. Gordon,
Rajiv L. Gupta, John A. Krol, Brendan R. O’Neill, Dinesh Paliwal, William S. Stavropoulos, Sandra S.
Wijnberg, David Yost and Michael Daniels.
Director Service
Directors are elected by an affirmative vote of an absolute majority of the votes cast by
shareholders at the Annual General Meeting of shareholders, whereby blank votes and abstentions are
included in establishing the number of votes cast. They serve for one-year terms, ending on the next
succeeding annual general meeting. Each Director must tender his or her resignation from the Board at
the annual general meeting of shareholders following his or her 72nd birthday. The Board may, in its
discretion, waive this limit in special circumstances, as it has done for Mr. Krol and Dr. Stavropoulos,
whom the Nominating and Governance Committee has nominated to serve additional terms in light of
their extensive business experience and knowledge. Any nominee for Director who does not receive a
majority of votes cast from the shareholders is not elected to the Board.
The Nominating and Governance Committee is responsible for the review of all Directors, and
where necessary will take action to recommend to shareholders the removal of a Director for
performance, which requires the affirmative vote of a majority of the votes present (in person or by
proxy) at a duly called shareholder meeting.
Directors are expected to inform the Nominating and Governance Committee of any significant
change in their employment or professional responsibilities and are required to offer their resignation
to the Board in the event of such a change. This allows for discussion with the Nominating and
Governance Committee to determine if it is in the mutual interest of both parties for the Director to
continue on the Board.
The guideline is for committee chairs and the lead Director to:
• serve in their respective roles five years, and
• to rotate at the time of the Annual General Meeting following the completion of their fifth year
of service.
The Board may choose to override these guiding principles in special circumstances or if it
otherwise believes it is appropriate to do so.
34 2012 Proxy Statement