Compensation Committee Charter

1. Purpose

The Compensation Committee (the “Committee”) is appointed by the Board of Directors (the “Board”) of Microfluidics International Corporation (the “Company”) for the primary purposes of assisting the Board in: 

• Developing and implementing compensation policies, programs and plans that are appropriate for the Company, provide incentives that further the Company’s overall goals and objectives, and enhance stockholder value;
• Overseeing the Company’s compensation policies, programs and plans, including its incentive compensation and equity based plans;
• Monitoring the results of the Company’s compensation policies, programs and plans to assure that the compensation paid to our officers and other key employees provides overall competitive pay levels and appropriately rewards enhancement of stockholder value; and
• Producing the “Compensation Committee Report” for inclusion in the Company’s Annual Report on Form 10-K or proxy statement and to review and discuss with management the “Compensation Discussion and Analysis” as required by the SEC to be included in the Company’s Annual Report on Form 10-K or proxy statement.

2. Membership

The Committee shall consist of such number of directors as determined by the Board from time to time, but no fewer than two members, each of whom satisfy the independence requirements under applicable law, rules and regulations, the requirements of “non-employee directors” as defined in Rule 16b-3 under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”) and “outside directors” as defined in Section 162(m) of the Internal Revenue Code of 1986, as amended.  Members of the Committee shall be appointed annually by the Board and may be removed by the Board at any time in its sole discretion.  The Chair of the Committee shall be appointed by the Board.  The compensation of the Committee members shall be as determined by the Board.

3. Powers and Responsibilities

The Committee’s responsibilities shall remain flexible to react to changing conditions and to ensure the Board and stockholders that: (a) the achievement of the overall goals and objectives of the Company can be supported by adopting appropriate compensation policies, programs and practices and implementing it through an effective total compensation program and (b) the compensation program and practices of the Company are designed with full consideration of all accounting, tax, securities law, employment law and regulatory requirements.

In carrying out its responsibilities, the Committee shall:

• Assist the Board in developing and evaluating potential candidates for executive positions, including the Chief Executive Officer, and, in conjunction with the Nominating and Corporate Governance Committee, oversee the development of executive succession plans. 
• Review and approve the corporate goals and objectives with respect to the compensation for the Chief Executive Officer.  The Committee shall evaluate at least once a year the Chief Executive Officer’s performance in light of these established goals and objectives and, based upon these evaluations, shall set the Chief Executive Officer’s compensation.  The Company’s Chief Executive Officer may not be present during the voting and deliberation concerning his or her compensation.
• Review the recommendations of the Chief Executive Officer with respect to the compensation of the other officers of the Company and determine the compensation of such officers.  In reviewing and approving such compensation, the Committee will consider the Company’s overall compensation objectives and goals, and with respect to each such officer: (a) his or her pre-established performance goals and objectives, (b) the Company’s performance, (c) strategic leadership consistent with the Company’s long term strategies, and (d) an appropriate peer group. 
• Provide oversight of management’s decisions concerning the performance and compensation of other Company employees. 
• Periodically review the Company’s incentive compensation and equity based plans and recommend changes in such plans to the Board, as needed. The Committee shall have and may exercise all the authority of the Board with respect to the administration of such plans.  The Committee shall also review and make recommendations regarding the number of shares, price per share and period and duration of stock grants under equity based plans approved by stockholders of the Company. 
• Review and make recommendations to the Board regarding all grants and awards under all incentive compensation and equity based plans; unless the Board requests that the Committee approve such grants or awards, which grants and awards will be promptly reported to the Board. 
• Review and make recommendations regarding the Company’s retirement plans. 
• Review and make recommendations to the Board for approval of independent directors’ compensation (e.g., retainers, fees, long-term incentive and equity plans). 
• Review and discuss with management the Company’s “Compensation Discussion and Analysis” and determine whether to recommend to the Board that the “Compensation Discussion and Analysis” be included in the Company’s Annual Report on Form 10-K or proxy statement.
• Prepare the annual Compensation Committee Report required for inclusion in the Company’s Annual Report on Form 10-K or proxy statement. 

The Committee shall have the authority to delegate any of its responsibilities to subcommittees as the Committee may deem appropriate in its sole discretion, except to the extent such delegation would be inconsistent under applicable law, rules and regulations.  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.  The Committee shall have authority to retain and terminate such compensation consultants, outside legal counsel and other advisors as the Committee may deem appropriate in its sole discretion.  The Committee will perform an annual assessment of any compensation consultant, legal counsel or other professional engaged by the Committee to provide advice or recommendations on executive and director compensation, which assessment will include a review of such consultant’s or other professional’s independence.  The Committee shall have sole authority to approve related fees and retention terms and shall have the power, without further Board action, to cause the Company to pay the compensation of such search firm or advisors engaged by the Committee.

4. Meetings

The Committee shall meet at least twice annually or more frequently as necessary or appropriate.  Members of management and independent consultants requested by the Committee will attend Committee meetings when and as may be requested by the Committee.

A simple majority of the members of the Committee will constitute a quorum. A majority of the members present at any meeting at which a quorum is present may act on behalf of the Committee. The Committee will meet at such times as shall be determined by the Chair of the Committee, or upon the request of any two of its members. The Chair will preside, when present, at all Committee meetings.  The Committee will maintain written minutes of its meetings, which minutes will be filed with the minutes of the meetings of the Board of Directors.

The Chair will periodically report the Committee’s findings, conclusions and recommendations to the Board and present to the Board an annual performance evaluation of the Committee. The Committee shall review at least annually the adequacy of this Charter and recommend any proposed changes to the Board for approval.

In carrying out it responsibilities, the Committee shall be entitled to rely upon advice and information that it receives in its discussions and communications with management and such advisors and other professionals as the Committee may consult with concerning such matters.

(Adopted by the Board of Directors at a meeting held on June 16, 2010)