Director Nomination Policy

The Board of Directors (the “Board”) of API Technologies Corp. (the “Company”) has adopted this Director Nomination Policy (the “Nomination Policy”) to be utilized by the Company’s independent directors (the “Independent Directors”).  The Board is committed to sound policies of corporate governance.  The Independent Directors will select candidates for the Board.  As such, the purpose of the Nomination Policy is to describe the process by which the Independent Directors will select candidates for possible inclusion in the Company’s recommended slate of director nominees.

A.    General Qualifications

When evaluating a person for nomination for election to the Board, the qualifications and skills considered  by  the Independent Directors, will include, but are not limited to:
  • whether or not the person will qualify as a director who is “independent” under applicable laws and regulations, including applicable NASDAQ rules, and whether the person is qualified under applicable laws and regulations to serve as a director of the Company;
  • whether or not the person is willing to serve as a director, and willing to commit the time necessary for the performance of the duties of a director;
  • the contribution that the person can make to the Board, with consideration being given to the person’s business experience, education and such other factors as the Board may consider relevant;
  • whether a candidate contributes to the Board’s overall diversity, with diversity being broadly construed to mean a variety of personal and professional experiences and education;
  • opinions, perspectives and backgrounds; and 
  • the character and integrity of the person.
The Company is of the view that the continuing service of qualified incumbents promotes stability and continuity in the board room, contributing to the Board’s ability to work as a collective body, while giving the Company the benefit of the familiarity and insight into the Company’s affairs that its directors have accumulated during their tenure. Accordingly, the process of the Committee for identifying nominees shall reflect the Company’s practice of re-nominating incumbent directors who continue to satisfy the Committee’s criteria for membership on the Board, whom the Committee believes continue to make important contributions to the Board and who consent to continue their service on the Board.
  
B.     Sources of Inquiry

The Independent Directors may use multiple sources for identifying director candidates, including its own contacts and referrals from other directors, members of management, the Company’s advisors, and executive search firms.  The Independent Directors will consider director candidates recommended by stockholders and will evaluate such director candidates in the same manner in which it evaluates candidates recommended by other sources.  
In making recommendations for director nominees for the annual meeting of stockholders, the Independent Directors will consider any written recommendations of director candidates by stockholders received by the Secretary of the Company in accordance with the Stockholder Communications Policy of the Company.  No person nominated by a shareholder will be eligible to serve as a director of the corporation unless nominated in accordance with the procedures set forth in such Stockholder Communications Policy.  The Chairman of the meeting shall, if the facts warrant, determine and declare to the meeting that a nomination was not properly brought before the meeting and if he or she should so determine, he or she shall so declare to the meeting and any such nomination not properly brought before the meeting shall be disregarded.  
This Nomination Policy is intended to provide a flexible set of guidelines for the effective functioning of the Company’s nomination process.  The Board of Directors and the Independent Directors anticipate that modifications may be necessary or appropriate from time to time as the Company’s needs and circumstances evolve, and as applicable legal or listing standards change.