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Committees

At Dean Foods, Board Committees operate under charters that provide clear standards for performing the various functions of those Committees. They monitor and evaluate their own performance, and periodically report to the Board.

The Dean Foods Board of Directors currently maintains four committees to assist in oversight responsibilities in the following areas:


Board Member

Audit

Compensation

Executive

Governance

Janet Hill

*

 

 

*(1)

J. Wayne Mailloux

*

*

   

Helen E. McCluskey

*

*

   

John R. Muse

  

*

 

B. Craig Owens

*(1)

 

 

*

Ralph P. Scozzafava

 

 

 *(1)

 

Jim L. Turner

 

*(1)

*

*

Robert Wiseman

     

*

 

(1) Committee Chair

The Audit Committee

 

Audit Committee Members:

  • Craig Owens - Chair
  • Wayne Mailloux
  • Janet Hill
  • Helen McCluskey

Audit Committee Charter

Status

The Audit Committee (the "Committee") is a committee of the Board of Directors (the "Board") of Dean Foods Company (the "Company"). 

Membership

The Committee shall consist of no fewer than three members. The members of the Committee shall meet the independence, experience and financial literacy requirements of the New York Stock Exchange ("NYSE"), Section 10A(m)(3) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations of the Securities and Exchange Commission (the "Commission"). At least one member of the Committee shall be an "audit committee financial expert" as defined by the Commission. Committee members shall not simultaneously serve on the audit committees of more than two other public companies. Committee members will be appointed, and may be removed or replaced with or without cause, by the Board. The Nominating / Corporate Governance Committee of the Board shall recommend to the Board, and the Board shall appoint, one member of the Committee to act as Chair thereof.

No member of the Committee may receive, directly or indirectly, any consulting, advisory or other compensatory fee from the Company or any of its subsidiaries, other than fees paid in his or her capacity as a member of the Board or of a committee of the Board. 

Purpose

The Committee will assist the Board in monitoring (1) the integrity of the financial statements of the Company, (2) the qualifications and independence of the Company's registered public accounting firm (the "independent auditor"), (3) the performance of the Company's internal audit function and independent auditor, (4) the compliance by the Company with legal and regulatory requirements and (5) risk assessment and risk management, including the Company's major financial risk exposures.

The Committee will oversee the Company's systems of disclosure controls and procedures, internal controls over financial reporting, and compliance with the Company's Code of Ethics.

The Committee shall prepare an audit committee report required by the rules of the Commission to be included in the Company's annual proxy statement. 

Committee Authority and Responsibilities 

The Committee shall have the sole authority to appoint, compensate, retain and terminate the engagement of the independent auditor, and recommend that the Board submit the independent auditor for stockholder ratification. The Committee shall be directly responsible for the

oversight of the work of the independent auditor for the purpose of preparing or issuing an audit report or related work, and shall resolve disagreements between management and the independent auditor regarding financial reporting. The independent auditor shall report directly to the Committee and the Committee is empowered, without further action by the Board, to cause the Company to pay the compensation of the independent auditor established by the Committee.

The Committee shall preapprove all audit services and permitted non-audit services to be performed for the Company by its independent auditor. The Committee may form and delegate authority to subcommittees consisting of one or more members when appropriate, including the authority to grant preapprovals of non-audit services, provided that decisions of such subcommittee to grant preapprovals shall be presented to the full Committee at its next scheduled meeting. De minimis non-audit services may be approved in accordance with applicable NYSE and Commission rules.

The Committee shall have the authority, to the extent it deems necessary or appropriate, to retain independent legal, accounting or other advisors to conduct investigations into any matters within its scope of responsibility at the expense of the Company. The Committee is empowered, without further action by the Board, to cause the Company to pay the compensation of such advisors as established by the Committee, as well as the ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties.

The Committee shall make regular reports to the Board, including reviewing with the Board any issues that arise with respect to the quality or integrity of the Company's financial statements, the Company's compliance with legal or regulatory requirements that may have a material impact on the Company's financial statements or compliance policies, the performance and independence of the Company's independent auditor, or the performance of the internal audit function. The Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval. The Committee shall annually review and evaluate the Committee's performance. 

The Committee, to the extent it deems necessary or appropriate, shall: 

Financial Statement and Disclosure Matters

1. Review and discuss with management and the independent auditor the annual audited financial statements, including disclosures made in the "Management's Discussion and Analysis" portion of any documents filed with the Commission, and recommend to the Board whether the audited financial statements should be included in the Company's Annual Report on Form 10-K.

2. Review and discuss with management and the independent auditor the Company's quarterly financial statements prior to the filing of each Quarterly Report on Form 10-Q, including disclosures made in the "Management's Discussion and Analysis" portion of any documents filed with the Commission, and the results of the independent auditor's review of the quarterly financial statements.

3. Discuss with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of the Company's financial statements, including any significant changes in the Company's selection or application of accounting principles, any major issues as to the adequacy of the Company's internal controls and any special steps adopted in light of material control deficiencies.

4. Review and discuss quarterly reports from the independent auditor on:
(a)  All critical accounting policies and practices to be used.
(b)  All alternative treatments of financial information within generally accepted accounting principles ("GAAP") related to material items that have been discussed with management, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the independent auditor.
(c)  Other material written communications between the independent auditor and management, including, but not limited to any management letter or schedule of unadjusted differences.
(d)  All discussions between the independent audit team and the firm's national office regarding the audit.
(e)  Any audit problems or difficulties encountered in the performance of services along with management's response.

5. Discuss with management the Company's earnings press releases, including the use of non-GAAP financial measures, as well as financial information and earnings guidance provided to analysts and rating agencies. Such discussion may be done generally (i.e., discussion of the types of information to be disclosed and the types of presentations to be made).

6. Discuss with management and the independent auditor the effect of regulatory and accounting initiatives, as well as off-balance sheet structures, on the Company's financial statements.

7. Consider whether the auditor's provision of permissible non-audit services is compatible with the auditor's independence. Discuss with the independent auditor the matters required to be discussed by Public Company Accounting Oversight Board Auditing Standard No. 16, Communications with Audit Committees, relating to the conduct of the audit, including any difficulties encountered in the course of the audit work, any restrictions on the scope of activities or access to requested information, and any significant disagreements with management.

8. Review disclosures made to the Committee, if any, by the Company's Chief Executive Officer and Chief Financial Officer during their certification process for each Annual Report on Form 10-K and Quarterly Report on Form 10-Q about any significant  deficiencies in the design or operation of internal controls or material weaknesses therein and any fraud involving management or other employees who have a significant role in the Company's internal controls.

9. Review and discuss with management (including the senior internal audit executive) and the independent auditor the Company's annual report on internal control over financial reporting and the independent auditor's audit of internal controls prior to the filing of the Company's Annual Report on Form 10-K. 

Oversight of the Company's Relationship with the Independent Auditor 

10. Obtain and review a report from the independent auditor at least annually regarding (a) the independent auditor's internal quality-control procedures, (b) any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm, (c) any steps taken to deal with any such issues, and (d) all relationships between the independent auditor and the Company, including the written disclosures and the letter from the independent auditor required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditor's communications with the Committee concerning independence. This report shall be used to evaluate the qualifications, performance and independence of the independent auditor, including consideration of whether the auditor's quality controls are adequate and the provision of permitted non-audit services is compatible with maintaining the auditor's independence, taking into account the opinions of management and internal auditors. The Committee shall present its conclusions with respect to the independent auditor to the Board.

11. Review the experience and qualifications of the lead partner each year, and confirm the rotation of the audit partners as required by applicable rules and regulations. Consider whether, in order to assure continuing auditor independence, it is appropriate to adopt a policy of rotating the independent auditing firm on a regular basis.

12. Establish and review from time to time policies for the Company's hiring of employees or former employees of the independent auditor who participated in any capacity in the audit of the Company.

Oversight of the Company's Internal Audit Function

13. Review the appointment and replacement of the senior internal auditing executive. 

14. Review the significant reports to management prepared by the internal auditing department and management's responses.

15. Discuss with the independent auditor and management the internal audit department responsibilities, budget and staffing and any recommended changes in the planned scope of the internal audit.

16. Periodically review, with the senior internal audit executive, any significant difficulties, disagreements with management, or scope restrictions encountered in the course of the function's work. 

Compliance, Risk Management and Corporate Social Responsibility Oversight

17. Establish procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters, and the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.

18. Oversee, review, and periodically update the Company's Insider Trading Policy, Code of Ethics and the Company's Corporate Ethics and Compliance program and recommend any changes to the Board.

19. Discuss with management and the independent auditor any correspondence with regulators or governmental agencies and any published reports which raise material issues regarding the Company's financial statements or accounting policies.

20. Discuss with the Company's General Counsel legal matters that may have a material impact on the financial statements or the Company's compliance policies.

21. Discuss policies and guidelines with respect to risk assessment and risk management, including the Company's major financial risk exposures, and steps management has taken to monitor and control such risks.

22. Review and approve the Company's entry into swaps, including transactions in swaps that are subject to mandatory clearing, and to approve use of the end-user exception from clearing. The Committee is also authorized to adopt and shall review annually thereafter a policy relating to the Company's use of the non-financial end-user exception, and shall report to the Board on the Company's compliance with and implementation of this policy on at least an annual basis. The Committee may delegate responsibility for implementation of the non-financial end-user policy to the Company's management, as the Committee deems appropriate

23. Provide oversight of the Company's policies and practices with respect to corporate social responsibility, including environmentally sustainable solutions, and the management of reputation risk.   

Meetings

The Committee shall meet as often as it determines, but not less frequently than quarterly. The Committee may also act by unanimous written consent in lieu of a meeting. The Committee shall meet periodically with management, the senior internal audit executive and the independent auditor in separate sessions. The Committee may request any officer or employee of the Company or the Company's outside counsel or independent auditor to attend a meeting of the Committee or to meet with any members of, or consultants to, the Committee. 

Limitation of Committee's Role

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 and disclosures 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. 

Dated: November 8, 2016 

 

The Compensation Committee

Compensation Committee Members:

  • Jim Turner - Chair
  • Wayne Mailloux
  • Helen McCluskey
  • John Muse

Compensation Committee Charter

Status

The Compensation Committee (the "Committee") is a committee of the Board of Directors (the "Board") of Dean Foods Company (the "Company").

Membership

  1. The Committee shall consist of at least three and no more than five members, all of whom shall have been determined by the Board to constitute independent directors, as defined by the rules of the New York Stock Exchange (the "NYSE") and the Securities and Exchange Commission (the "Commission").

  2. Each member must also qualify as a "non-employee director" as such term is defined in Rule 16b-3 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), with regard to any compensation or benefit plan administered by the Committee that is subject to Rule 16b-3 of the Exchange Act.

  3. At least two members shall also qualify as "outside directors" as such term is defined under Section 162(m) and the regulations thereunder of the Internal Revenue Code (the "IRC") if any award or payment under any compensation or benefit plan administered by the Committee would be subject to the deduction limitation under Section 162(m) of the IRC.

  4. Committee members will be appointed, and may be removed or replaced, with or without cause, by the Board.

  5. The Nominating / Corporate Governance Committee of the Board shall recommend to the Board, and the Board shall appoint, one member to act as Chair of the Committee.

Purpose

The purpose of the Committee is to act on behalf of the Board in setting the Company's executive compensation policies and objectives and administering the Company's executive compensation programs.

Committee Authority and Responsibilities

Plans

  1. Except as otherwise provided herein, the Committee shall exercise all rights, authority and functions of the Board under all of the Company's stock option, stock incentive, employee stock purchase, restricted stock and other equity-based plans (collectively, the "Plans"), including without limitation, the authority to interpret the terms thereof.

  2. The Committee shall authorize awards to employees of options, restricted stock units, restricted shares and other stock-based awards under the Plans.

  3. The Committee, or a majority of the Company's independent directors, shall approve all non-Plan equity compensation grants that are made in reliance on an exemption from the shareholder approval requirements of Section 303A.08 of the NYSE Listed Company Manual. The Committee, or a majority of the Company's independent directors, may approve the adoption, amendment or termination of any non-Plan equity compensation program adopted pursuant to such exemption.

  4. The Committee shall recommend to the Board for its approval the adoption, amendment or termination of any compensation program for the Company. Notwithstanding the foregoing sentence, such adoption, amendment or termination may be approved by the Committee if so authorized pursuant to the plan or a resolution of the Board. The Committee may adopt, amend or terminate the Company's employee benefit plans. 

Compensation

  1. The Committee shall review and approve performance goals and objectives relevant to the compensation of the Chief Executive Officer (the "CEO"), evaluate the CEO's performance in light of those goals and objectives, and, either as a committee or together with the other independent directors (as directed from time to time by the Board), determine and approve the CEO's compensation based on this evaluation.

  2. The Committee shall obtain recommendations from management and determine base salary and incentive compensation of executive officers. In determining the long-term incentive component for the Company's CEO and other executive officers, the Committee may consider, among other things: (i) the Company's performance and relative shareholder return; (ii) the value of similar incentive awards to chief executive officers and other executive officers at comparable companies; and (iii) the awards given to the Company's CEO and other executive officers in previous years.

  3. The Committee may establish performance goals applicable to non-CEO executive officers and determine the extent to which such performance goals have been attained.

  4. The Committee may generally advise on the setting of compensation for senior officers whose compensation is not otherwise set by the Committee.

  5. The Committee may, in its sole discretion, retain or obtain the advice of one or more compensation consultants, independent legal counsel or other advisors to assist in the evaluation of the compensation of the Company's CEO or other executive officers. The Committee shall have the sole authority to retain, oversee and terminate such consultants, independent legal counsel and other advisors and to approve the fees and other retention terms with respect thereto. The Committee is empowered, without further action by the Board, to cause the Company to pay any such fees as well as the ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties. The Committee may select, or receive advice from, a compensation consultant, independent legal counsel or other advisor, only after taking into consideration, as applicable, all factors relevant to that person's independence from management, including the factors specified in NYSE Rule 303A.05(c)(iv). The Committee shall, at least bi-annually, review the other human resources services that any compensation consultant provides to the Company or its affiliates.

  6. The Committee shall periodically review and make recommendations to the Board with respect to director compensation. 

Commission Reporting Requirements

  1. The Committee shall publish an annual Compensation Committee Report for inclusion in the Company's proxy statement which complies with the rules and regulations of the Commission and the NYSE and any other applicable rules and regulations.

  2. The Committee shall review and discuss the Compensation Discussion and Analysis (the "CD&A") required to be included in the Company's proxy statement and Annual Report on Form 10-K by the rules and regulations of the Commission with management and, based on such review and discussion, determine whether or not to recommend to the Board that the CD&A be so included. 

General

  1. The Committee shall prepare an annual evaluation of its performance.

  2. The Committee may form and delegate authority to one or more subcommittees as it deems appropriate from time to time under the circumstances (including (i) a subcommittee consisting of a single member and (ii) a subcommittee consisting of at least two members, each of whom qualifies as a "non-employee director," as such term is defined in Rule 16b-3 promulgated under the Exchange Act and the rules and regulations thereunder, and an "outside director," as such term is defined from time to time in Section 162(m) of the IRC and the rules and regulations thereunder).

  3. The Committee may perform such other functions as shall be assigned to it by resolution of the Board.

  4. The Committee shall make regular reports to the Board.

  5. The Committee shall periodically review and reassess the adequacy of this Charter and recommend any proposed changes to the Board for approval.

  6. The Committee shall have the authority to conduct or authorize investigations into any matters within the scope of its responsibilities as it shall deem appropriate, including the authority to request any officer, employee or advisor of the Company to meet with the Compensation Committee or any advisors engaged by the Compensation Committee. 

Meetings

  1. The Committee will meet as often as may be deemed necessary or appropriate and at such times and places as the Committee shall determine. Meetings may be called by the Committee Chair, Chairman of the Board or two or more Committee Members. The majority of the members of the Committee shall constitute a quorum. The Committee may also act by unanimous written consent in lieu of a meeting.

  2. Complete and accurate minutes will be kept of each meeting and sent to each Committee member and, upon request, to the other Board members who are not on the Committee. 

Dated: November 8, 2016 

The Executive Committee

The Executive Committee has limited powers to act on behalf of the Board of Directors when the Board of Directors is not in session. This Committee meets only as needed.

Executive Committee Members:

  • Ralph Scozzafava - Chair
  • John Muse
  • Jim Turner

The Nominating / Corporate Governance Committee

 

Nominating / Corporate Governance Committee Members:

  • Janet Hill - Chair
  • Craig Owens
  • Jim Turner
  • Robert Wiseman

Nominating / Corporate Governance Committee Charter

Status

The Nominating / Corporate Governance Committee (the "Committee") is a committee of the Board of Directors (the "Board") of Dean Foods Company (the "Company"). 

Membership

  1. The Committee shall consist of at least three and no more than five members, all of whom shall have been found by the Board to constitute independent directors, as defined by the rules and regulations of the New York Stock Exchange and the Securities and Exchange Commission.

  2. Committee members will be appointed, and may be removed with or without cause, by the Board.

  3. Each member of the Committee shall be free of any relationship that, in the judgment of the Board from time to time, would interfere with the exercise of his or her independent judgment.

  4. The Committee shall recommend to the Board, and the Board shall appoint, one member to act as Chair of the Committee. 

Purpose

The purpose of the Committee is to consider, develop and make recommendations to the Board regarding corporate governance principles generally and the appropriate size, function, operation and needs of the Board and its committees to optimize the effectiveness of the Board, and identifying and recommending candidates to fill positions on the Board. 

Committee Authority and Responsibilities

The specific responsibilities of the Committee include the following:

  • developing and recommending to the Board the criteria for membership on the Board;

  • using the criteria established by the Board for Board membership to guide the Board's director selection process;

  • assessing the contributions and independence of incumbent directors in determining whether to recommend them for reelection to the Board;

  • considering, recommending and recruiting candidates to fill new positions on the Board;

  • reviewing candidates recommended by stockholders for membership on the Board;

  • conducting the appropriate and necessary inquiries into the backgrounds and qualifications of possible candidates for membership on the Board;

  • recommending the director nominees for approval by the Board and the stockholders; and

  • reviewing the qualifications of potential Lead Director candidates and recommending such candidates to the Board. 

The Committee's additional functions are to:
  • consider questions of possible conflicts of interest of Board members and of the Company's senior executives, and establish and review, from time to time, policies and procedures with respect to related party transactions and to review and approve these transactions;

  • monitor and recommend the function, structure and composition of the various committees of the Board;

  • recommend members and chairpersons of the committees of the Board;

  • recommend to the Board whether to accept or reject the resignation of an incumbent director who failed to receive a majority of the votes cast in an election that is not a Contested Election (as defined in the Company's bylaws);

  • review directorships on outside boards held by or offered to directors of the Company;

  • make recommendations on the structure of Board meetings;

  • oversee the annual evaluation of the Board and its committees and recommend matters for consideration by the Board regarding improvement of the effectiveness of the Board and its committees;

  • oversee the evaluation of management;

  • consider matters of corporate governance and review, periodically, the Corporate Governance Principles and recommend any proposed changes to the Board for approval;

  • recommend development activities, including director orientation, for the Board;

  • review and establish, and to make recommendations to the Board with respect to exceptions to, director tenure and retirement policies;

  • review significant changes in a director's principal responsibility or occupation, and make recommendations to the Board with respect to the director's offer to resign as a result of such changes;

  • recommend the election of senior officers to the Board; 

  • review periodically with the Chairman of the Board and the Chief Executive Officer the succession plans relating to positions held by elected corporate officers, and to make recommendations to the Board with respect to the selection of individuals to occupy these positions;

  • retain and terminate recruiting or search firms to assist in the selection of director candidates or Chief Executive Officer candidates, to the extent necessary or desirable, and to approve the fees and other retention terms of these firms;

  • prepare an annual performance evaluation of the Committee;

  • make regular reports to the Board; and

  • undertake such other responsibilities or tasks as the Board may delegate to the Committee from time to time. 

Meetings
  1. The Committee will meet as often as may be deemed necessary or appropriate and at such times and places as the Committee shall determine. Meetings may be called by the Committee Chair, Chairman of the Board, the Lead Director or two or more Committee Members. The majority of the members of the Committee shall constitute a quorum. The Committee may also act by unanimous written consent in lieu of a meeting.

  2. Complete and accurate minutes will be kept of each meeting and sent to each Committee member and, upon request, to the other Board members who are not on the Committee.

  3. The Committee has the authority to delegate any of its responsibilities to one or more subcommittees (including a subcommittee consisting of a single member) as the Committee may deem appropriate from time to time under the circumstances. 

General

  1. The Committee may seek the assistance and counsel of outside advisors at the Company's expense, as the Committee determines is appropriate. The Committee is empowered, without further action by the Board, to cause the Company to pay the ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties.

  2. The Committee shall have the authority to conduct or authorize investigations into any matters within the scope of its responsibilities as it shall deem appropriate, including the authority to request any officer, employee or advisor of the Company to meet with the Committee or any advisors engaged by the Committee. In fulfilling its responsibilities, the Committee will have full access to all of the Company's books, records, facilities and personnel. 

Dated: November 8, 2016