A meeting of the Compensation Committee of the Board of Trustees convened at 8:24 a.m. on Friday, October 7, 2022, in Room 326 of Stewart Center on the campus of Purdue University in West Lafayette, Indiana.

All committee members present: Malcolm DeKryger, chair; Michael Klipsch; and Gary Lehman. All other trustees were present: Sonny Beck; Michael Berghoff; JoAnn Brouillette; Theresa Carter; Vanessa Castagna; Mark Gee; and Shawn Taylor.

Officers and administrators in attendance were: Mitch Daniels, president; Jay Akridge, provost and executive vice president for academic affairs and diversity; Chris Ruhl, chief financial officer and treasurer; Eva Nodine, senior vice president, assistant treasurer, and assistant secretary; Steve Schultz, general counsel; Cindy Ream, corporate secretary and senior executive assistant to the Board; Ron Elsenbaumer, chancellor, Purdue University Fort Wayne; and Tom Keon, chancellor, Purdue University Northwest.

I. APPROVAL OF MINUTES

Upon proper motion made and duly seconded, the Compensation Committee voted unanimously to approve the minutes of its last meeting convened on August 5, 2022, and an executive session convened on October 4, 2022.

II. DETERMINATION OF PRESIDENTIAL PERFORMANCE AT-RISK PAY FOR 2021-2022

Trustee DeKryger stated the next order of business was determination of President Daniels performance for the at-risk portion of his income. He congratulated President Daniels, University faculty, staff and students for their efforts and achievements over the past year. He shared that over the past ten years President Daniels and the entire campus community have continued to exceed the goals set before them. He thanked everyone for their persistence and the innovative thinking and commitment in making Purdue among the top educational institutions in the world. He pointed out that the Board set goals that were across the board higher than the prior year and at record levels. The committee has determined that President Daniels earned 98% of his at-risk pay for 2021-2022. He outlined President Daniels’ achievements in the four metrics categories as follows: student affordability (goal 20%, achieved 20%); student success (goal 30%, achieved 26%); fundraising (goal 20%, achieved 26%); and operations (goal 30%, achieved 26%). Trustee DeKryger noted that President Daniels reached or exceeded the goal set in 12 of the 17 metrics that make up his at-risk pay. Trustee DeKryger summarized that with a base pay of $430,000.00 and the at risk portion being equal to 50% of that, he recommended that President Daniels be paid 98% of the at-risk portion of $215,000.00 in the amount of $210,700.00.

Trustee Mike Klipsch provided explanation on President Daniels achievement of 26% out of 20% in Fundraising. He noted the three goal levels; threshold goal, target goal which is higher and a stretch goal which was a much larger number. He shared that President Daniels hit the stretch goal resulting in a percentage above the original goal. There was further discussion on specifics of decisions on weights for some of the objectives clarified the percentage outcomes. For the operations category there were three significant achievements that should be noted, Skywater coming to Purdue, Rolls Royce making a $70+M investment, and the separation in Indianapolis in IUPUI. Trustee Klipsch made note of the complex challenges presented and that the bar was set very high. Upon proper motion duly made and seconded, the Compensation Committee voted unanimously to request full Board approval to award President Daniels the at-risk portion of his salary as recommended. Supporting materials were filed with the minutes. A copy of the supporting documents were filed with the minutes.

III. APPROVAL OF EMPLOYMENT AGREEMENT – MUNG CHIANG

Trustee DeKryger noted the last item on the agenda is the approval of employment agreement for Dr. Mung Chiang. He shared that one of the unique features is that Dr. Mung Chiang will be the first tenured faculty of Purdue University to become the president of the university. Trustee DeKryger shared some of the specifics of the contract noting the starting salary, at-risk pay details, and retention incentives. Steve Schultz, general counsel provided insight to portions of the contract which were different than what we have seen in the past. Some in part, due to his faculty status and his research and teaching work. Trustee DeKryger stated that the contract is for six and a half years, through June 2029. It was noted that at-risk performance outcomes would stay the same at the beginning and will then be revisited with Dr. Chiang, the committee, and the board. Upon proper motion duly made and seconded, the Compensation Committee voted unanimously to request full Board approval of the employment agreement of Dr. Mung Chiang as Purdue’s next President. A copy of the agreement was filed with the minutes.

IV. ADJOURNMENT

By consent, the meeting adjourned at 8:45 a.m.