Compensation Committee

PURPOSE

The Compensation Committee (the “Committee”) is appointed by the Board of Directors (the “Board”) of Cohen & Company (the “Company”) to assist the Board in discharging its responsibilities relating to compensation of the Company’s directors and officers. The Committee has overall responsibility for evaluating, recommending changes to and administering compensation plans, policies and programs of the Company.

Organization

The Committee will consist of no fewer than three members. All members of the Committee will be, in the business judgment of the Board, “independent” under the independence requirements set forth, from time to time, in the listing standards of the NYSE Amex (“AMEX”) and any other applicable laws, rules or regulations, including, without limitation, any rules promulgated by the Securities and Exchange Commission. The members will be appointed annually for a term of one year and will serve at the pleasure of the Board.

The members of the Committee will be appointed, removed and replaced by, and in the sole discretion of, the Board.

The Board will designate one member of the Committee to be the chairman of the Committee.

The Committee will create its own rules of procedure, including rules regarding notice of meetings, quorum and voting. Such rules will be consistent with the Company’s articles of incorporation, as amended, bylaws and with this charter.

The Committee may create subcommittees to perform particular functions, either generally or in specific instances, and such subcommittees shall be comprised of members who meet the independence requirements set forth above and shall have published charters.

Minutes will be kept with regard to each meeting of the Committee, which will record all actions taken by the Committee. The minutes will be maintained with the books and records of the Company. Copies of the minutes of each meeting of the Committee will be sent promptly after the meeting to all members of the Board.

The Committee will report to the Board at all regular meetings of the Board or at such other times as the Committee deems necessary or appropriate.

The Committee shall meet in person or telephonically at least twice a year at a time and place determined by the Committee chairman, with further meetings to occur when deemed necessary or desirable by the Committee or its chairman. Actions of the Committee may also be taken by unanimous written consent when deemed necessary or desirable by the Committee or its chairman.

The Committee may request members of management or others to attend meetings and provide pertinent information as necessary.

RESPONSIBILITIES AND POWERS

Among its specific duties and responsibilities, the Committee shall:

• review the Company’s overall compensation structure, policies and programs;
• make recommendations to the Board with respect to incentive-compensation plans and equity-based plans, which may include recommendations with respect to the management agreement by and between the Company and Cohen & Company Management, LLC, the Company’s external manager;
• annually review the compensation of directors for service on the Board and its committees and recommend changes in compensation to the Board;
• review, at least annually, the performance of the Chief Executive Officer and communicate the results of the review to the Chief Executive Officer and the Board;
• produce an annual report on executive compensation for inclusion in the Company’s proxy statement; and
• review and reassess the adequacy of this charter annually and recommend any proposed changes to the Board for approval, and annually review the Committee’s performance based upon, among other things, an assessment of the Committee’s fulfillment of its obligations pursuant to this charter. The Committee’s findings shall be reported to the Board, and such review shall seek to identify specific areas, if any, in need of improvement or strengthening.

RESOURCES AND AUTHORITY OF THE COMMITTEE

The Committee shall have the resources and authority appropriate to discharge its duties and responsibilities, including the authority to retain counsel and other experts or consultants at the expense of the Company without seeking approval of the Board. The Committee shall have the sole authority to select and retain a consultant or search firm, to terminate any consultant or search firm retained by it, and to approve the consultant or search firm’s fees and other retention terms. The Committee has the power in its discretion, to conduct any investigation it deems necessary or appropriate to enable it to carry out its duties.