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Corporate Governance

Committee Members
Committee MemberBARBARA D. BOYAN, PH.D.
ChairpersonPETER L. WILSON
Committee MemberGREGORY A. BELINFANTI
Nominating and Corporate Governance Committee Charter
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ARTHROCARE CORPORATION
Amended and Restated Nominating and Corporate Governance Committee Charter

[Adopted August 29, 2009]

This Amended and Restated Nominating and Corporate Governance Committee Charter (this "Charter") was adopted by the Board of Directors (the "Board") of ArthroCare Corporation (the "Company") on August 29, 2009.

I. Purpose

The purpose of the Nominating and Corporate Governance Committee (the "Committee") of the Board is to assist the Board in discharging the Board's responsibilities regarding:

  1. the identification of qualified candidates to become Board members;
  2. the selection of nominees for election as directors at the next annual meeting of stockholders (or special meeting of stockholders at which directors are to be elected);
  3. the selection of candidates to fill any vacancies on the Board;
  4. the appointment of an individual to serve as the Company's chief executive officer following the departure or resignation of David Fitzgerald as Acting President and Chief Executive Officer; and
  5. the development and recommendation to the Board of a set of corporate governance guidelines and principles applicable to the Company (the "Corporate Governance Guidelines").

In addition to the powers and responsibilities expressly delegated to the Committee in this Charter, the Committee may exercise any other powers and carry out any other responsibilities delegated to it by the Board from time to time consistent with the Company's Bylaws. The powers and responsibilities delegated by the Board to the Committee in this Charter or otherwise shall be exercised and carried out by the Committee as it deems appropriate without requirement of Board approval, and any decision made by the Committee (including any decision to exercise or refrain from exercising any of the powers delegated to the Committee hereunder) shall be at the Committee's sole discretion. While acting within the scope of the powers and responsibilities delegated to it, the Committee shall have and may exercise all the powers and authority of the Board. To the fullest extent permitted by law, the Committee shall have the power to determine which matters are within the scope of the powers and responsibilities delegated to it.



II. Membership

The Committee shall be composed of three or more directors, as determined by the Board, each of whom (a) qualifies as independent under the Nasdaq listing requirements, and (b) has experience, in the business judgment of the Board, that would be helpful in addressing the matters delegated to the Committee.

The members of the Committee, including the Chair of the Committee, shall be appointed by the Board. Committee members may be removed from the Committee, with or without cause, by the Board.



III. Meetings and Procedures

The Chair (or in his or her absence, a member designated by the Chair) shall preside at each meeting of the Committee and set the agendas for Committee meetings. The Committee shall have the authority to establish its own rules and procedures for notice and conduct of its meetings so long as they are consistent with the provisions of the Company's Bylaws.

The Committee shall meet on a regularly scheduled basis at least two times per year and more frequently as the Committee deems necessary or desirable.

All non-management directors that are not members of the Committee may attend and observe meetings of the Committee, but shall not participate in any discussion or deliberation unless invited to do so by the Committee, and in any event shall not be entitled to vote. The Committee may, at its discretion, include in its meetings members of the Company's management, or any other person whose presence the Committee believes to be desirable and appropriate. Notwithstanding the foregoing, the Committee may exclude from its meetings any person it deems appropriate, including but not limited to, any non-management director that is not a member of the Committee.

The Committee shall have the authority, as it deems appropriate, to retain or replace, as needed, any independent counsel or other outside expert or advisor that the Committee believes to be desirable and appropriate. The Committee, in its discretion, may also use the services of the Company's regular inside or outside legal counsel or other advisors to the Company. The Company shall provide for appropriate funding, as determined by the Committee, for payment of compensation to any such persons retained by the Committee. The Committee shall have sole authority to retain and terminate any search firm to be used to identify director candidates, including sole authority to approve such search firm's fees and other retention terms.

The Chair shall report to the Board regarding the activities of the Committee at appropriate times and as otherwise requested by the Chairman of the Board or the Lead Independent Director.



IV. Duties and Responsibilities

1. (a) At an appropriate time prior to each annual meeting of stockholders at which directors are to be elected or reelected, the Committee shall recommend to the Board for nomination by the Board such candidates as the Committee, in the exercise of its judgment, has found to be well qualified and willing and available to serve.

(b) At an appropriate time after a vacancy arises on the Board or a director advises the Board of his or her intention to resign, the Committee shall recommend to the Board for appointment by the Board to fill such vacancy, such prospective member of the Board as the Committee, in the exercise of its judgment, has found to be well qualified and willing and available to serve.

(c) For purposes of (a) and (b) above, the Committee may consider, among other things, the following criteria in recommending candidates for election to the Board:

  1. experience in corporate governance, such as an officer or former officer of a publicly held company;
  2. experience in the Company's industry;
  3. experience as a board member of another publicly held company; and
  4. academic expertise in an area of the Company's operations.

(d) The foregoing notwithstanding, if the Company is legally required by contract or otherwise to permit a third party to designate one or more of the directors to be elected or appointed (for example, pursuant to rights contained in a Certificate of Designations of a class of preferred stock to elect one or more directors), then the nomination or appointment of such directors shall be governed by such requirements.

2. The Committee shall, at least annually, review the performance of each current director and shall consider the results of such evaluation when determining whether or not to recommend the nomination of such director for an additional term.

3. In appropriate circumstances, the Committee, in its discretion, shall consider and may recommend the removal of a director for cause, in accordance with the applicable provisions of the Company's Certificate of Incorporation, Bylaws and Corporate Governance Guidelines.

4. The Committee shall oversee the Board in the Board's annual review of its performance (including its composition and organization) and the performance of management, and will make appropriate recommendations to improve performance.

5. The Committee shall recommend to the Board, by unanimous vote of its members, the individual to replace David Fitzgerald as chief executive officer of the Company following his departure or resignation.

6. The Committee may make recommendations to the Board regarding governance matters, including, but not limited to, the Company's Certificate of Incorporation, Bylaws, this Charter and the charters of the Company's other committees .

7. The Committee shall develop and recommend to the Board the Corporate Governance Guidelines.

8. The Committee shall evaluate its own performance on an annual basis, including its compliance with this Charter, and provide the Board with any recommendations for changes in procedures or policies governing the Committee. The Committee shall conduct such evaluation and review in such manner as it deems appropriate.

9. The Committee shall periodically report to the Board on its findings and actions.

10. The Committee shall review and reassess this Charter at least annually and submit any recommended changes to the Board for its consideration.



V. Delegation of Duties

In fulfilling its responsibilities, the Committee shall be entitled to delegate any or all of its responsibilities (other than the responsibility to recommend an individual to replace David Fitzgerald as chief executive officer as described in Article IV, paragraph 5 above) to a subcommittee of the Committee, to the extent consistent with the Company's Certificate of Incorporation, Bylaws, Corporate Governance Guidelines and applicable law and rules of markets in which the Company's securities then trade.

 
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