WONDER AUTO TECHNOLOGY, INC.
AUDIT COMMITTEE CHARTER
The Purpose of the Audit Committee
The purpose of the Audit Committee of Wonder Auto Technology, Inc. (the “Company”) is to represent and assist the board of directors in its general oversight of the Company's accounting and financial reporting processes, audits of the financial statements, and internal control and audit functions. Management is responsible for (a) the preparation, presentation and integrity of the Company's financial statements; (b) accounting and financial reporting principles; and (c) the Company's internal controls and procedures designed to promote compliance with accounting standards and applicable laws and regulations. The Company's independent auditing firm is responsible for performing an independent audit of the consolidated financial statements in accordance with generally accepted auditing standards.
The Audit Committee members are not professional accountants or auditors and their functions are not intended to duplicate or to certify the activities of management and the independent auditor. Consequently, it is not the duty of the Audit Committee to conduct audits or to determine that the Company’s financial statements and disclosures are complete and accurate and are in accordance with generally accepted accounting principles and applicable rules and regulations. These are the responsibilities of management and the independent auditor. Nor is it the duty of the Audit Committee to conduct investigations, to resolve disagreements, if any, between management and the independent auditor or to assure compliance with laws and regulations and the Company’s Code of Ethics. The Audit Committee serves a board level oversight role where it oversees the relationship with the independent auditor, as set forth in this charter, receives information and provides advice, counsel and general direction, as it deems appropriate, to management and the auditors, taking into account the information it receives, discussions with the auditor, and the experience of the Audit Committee's members in business, financial and accounting matters.
Membership and Structure
The Audit Committee is comprised of at least three directors determined by the board of directors to meet the director and audit committee member independence requirements and financial literacy requirements of The NASDAQ Stock Market, Inc. ("NASDAQ"), the Securities and Exchange Commission or any other applicable requirements. At least one member of the Audit Committee must be financially sophisticated, as determined by the Board, and no Audit Committee member may have participated in the preparation of the financial statements of the Company or any of the Company's current subsidiaries at any time during the past three years, each as required by NASDAQ listing standards. Appointment to the Audit Committee, including the designation of the Chair of the Audit Committee and the designation of any Audit Committee members as "audit committee financial experts", shall be made on an annual basis by the full Board upon recommendation of the Governance and Nominating Committee. Meetings of the Audit Committee shall be held at such times and places as the Audit Committee shall determine, including by written consent. When necessary, the Audit Committee shall meet in executive session outside of the presence of any senior executive officer of the Company. The Chair of the Audit Committee shall report on activities of the Audit Committee to the full Board. In fulfilling its responsibilities the Audit Committee shall have authority to delegate its authority to subcommittees, in each case to the extent permitted by applicable law.
Operations
The Audit Committee meets at least four times a year, on a quarterly basis. Additional meetings may occur as the Audit Committee or its chairperson deems advisable. The Audit Committee shall meet in executive session privately, with the independent auditor, without the chief internal auditor and management present, not less frequently than quarterly. The Audit Committee will cause adequate minutes of all its proceedings to be kept, and will report on its actions and activities at the next quarterly meeting of the board of directors of the Company. Audit Committee members will be furnished with copies of the minutes of each meeting and any action taken by unanimous consent. The Audit Committee is governed by the same rules regarding meetings (including meetings by conference telephone or similar communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as are applicable to the board of directors of the Company. The Audit Committee is authorized to adopt its own rules of procedure not inconsistent with (a) any provision of this Charter, (b) any provision of the Bylaws of the Company, or (c) the laws of the state of Nevada.
The Chairman of the Audit Committee is to be contacted directly by the chief internal auditor or the independent auditor (1) to review items of a sensitive nature that can impact the accuracy of financial reporting or (2) to discuss significant issues relative to the overall Board responsibility that have been communicated to management but, in their judgment, may warrant follow-up by the Audit Committee.
Authority
The Audit Committee will have the resources and authority necessary to discharge its duties and responsibilities. The Audit Committee shall have the authority to engage independent legal, accounting and other advisers, as it determines necessary to carry out its duties. The Audit Committee shall have sole authority to approve related fees and retention terms. Any communications between the Audit Committee and legal counsel in the course of obtaining legal advice will be considered privileged communications of the Company and the Audit Committee will take all necessary steps to preserve the privileged nature of those communications.
The Audit Committee may form and delegate authority to subcommittees and may delegate authority to one or more designated members of the Audit Committee.
Responsibilities
The Audit Committee:
1. is directly responsible for the appointment, replacement, compensation, and oversight of the work of the independent auditor. The independent auditor shall report directly to the Audit Committee.
2. obtains and reviews annually a report by the independent auditor describing the firm's internal quality-control procedures; any material issues raised by the most recent internal quality-control review or peer review or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues.
3. reviews and discusses with the independent auditor the written statement from the independent auditor concerning any relationship between the auditor and the Company or any other relationships that may adversely affect the independence of the auditor, and, based on such review, assesses the independence of the auditor.
4. establishes policies and procedures for the review and pre-approval by the Audit Committee of all auditing services and permissible non-audit services (including the fees and terms thereof) to be performed by the independent auditor.
5. reviews and discusses with the independent auditor: (a) its audit plans, and audit procedures, including the general audit approach, scope, staffing, fees and timing of the audit; (b) the results of the annual audit examination and accompanying management letters; and (c) the results of the independent auditor's procedures with respect to interim periods.
6. reviews and discusses reports from the independent auditor on (a) all critical accounting policies and practices used by the Company, (b) alternative accounting treatments within GAAP related to material items that have been discussed with management, including the ramifications of the use of the alternative treatments and the treatment preferred by the independent auditor, and (c) other material written communications between the independent auditor and management.
7. reviews and discusses with the independent auditor the independent auditor's judgments as to the quality, not just the acceptability, of the Company's accounting principles and such further matters as the independent auditors present the Audit Committee under generally accepted auditing standards.
8. discusses with management and the independent auditor quarterly earnings press releases, including the interim financial information and business discussion included therein, reviews and discusses with management and independent auditor the unaudited quarterly or interim financial statements and the management discussion and analysis in the quarterly report or the annual report, the year-end audited financial statements and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and, if deemed appropriate, recommends to the board of directors that the audited financial statements be included in the Annual Report on Form 10-K for the year.
9. reviews and discusses with management and the independent auditor various topics and events that may have significant financial impact on the Company or that are the subject of discussions between management and the independent auditors.
10. reviews and discusses with management the Company's major financial risk exposures and the steps management has taken to monitor and control such exposures.
11. reviews and approves related-party transactions (as defined in the relevant NASDAQ requirements).
12. reviews and discusses with management, the independent auditor, and the Company's chief internal auditor: (a) the adequacy and effectiveness of the Company's internal controls (including any significant deficiencies and significant changes in internal controls reported to the Audit Committee by the independent auditor or management); (b) the Company's internal audit procedures; and (c) the adequacy and effectiveness of the Company's disclosure controls and procedures, and management reports thereon.
13. reviews annually with the chief internal auditor the scope of the internal audit program, and reviews annually the performance of both the internal audit group and the independent auditor in executing their plans and meeting their objectives.
14. reviews and concurs in the appointment, replacement, reassignment, or dismissal of any chief internal auditor of the Company.
15. reviews the use of auditors other than the independent auditor in cases such as management's request for second opinions.
16. reviews matters related to the corporate compliance activities of the Company.
17. establishes procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters, and the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.
18. establishes policies for the hiring of employees and former employees of the independent auditor.
19. publishes the report of the Audit Committee required by the rules of the Securities and Exchange Commission to be included in the Company's annual proxy statement.
20. periodically review with the Company’s in-house and independent counsel any legal matters that could have a significant impact on the Company’s financial statements, the Company’s compliance with applicable laws and regulations, and any material reports or inquiries received from regulators or governmental agencies.
21. obtain timely reports from management and the Company’s senior internal auditing executive and counsel that the Company and its subsidiaries are in conformity with applicable legal requirements and the Company’s Code of Ethics, including disclosures of insider and affiliated party transactions.
22. advice the Board of Directors with respect to the Company’s policies and procedures regarding compliance with applicable laws and regulations and with the Company’s Code of Ethics.
23. review and approved the Company’s Code of Ethics, as it may be amended and updated from time to time, and ensure that management has implemented a compliance program to enforce such Code. Ensure that such compliance program includes reporting violations of such Code of Ethics to the Audit Committee
24. review reported violations of the Company’s Code of Ethics.
25. review and approve (a) any change or waiver in the Company’s Code of Ethics for principal executives and senior financial officers and (b) any disclosures made on Form 8-K regarding such change or waiver.
26. when appropriate, designates one or more of its members to perform certain of its duties on its behalf, subject to such reporting to or ratification by the Audit Committee as the Audit Committee shall direct.
27. will engage in an annual self-assessment with the goal of continuing improvement, and will annually review and reassess the adequacy of its charter, and recommends any changes to the full Board.
28. the Audit Committee shall consult with management but may not delegate these responsibilities, except as specifically provided for above.
Adopted by the Board of Directors on March 23, 2007
WONDER AUTO TECHNOLOGY, INC.
COMPENSATION COMMITTEE CHARTER
The Purpose of the Compensation Committee
The purpose of the compensation committee is to discharge the responsibilities of the board of directors of Wonder Auto Technology, Inc. (the “company”) relating to compensation of the company’s executives, to produce an annual report on executive compensation for inclusion in the company’s proxy statement, and to oversee and advise the board of directors of the company on the adoption of policies that govern the company’s compensation programs, including stock and benefit plans.
Membership and Structure
The membership of the Compensation Committee consists of at least three directors, all of whom shall (a) meet the independence requirements established by the board of directors of the company and applicable laws, regulations and listing requirements of The NASDAQ Stock Market, Inc., (b) be a “non-employee director” within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934, and (c) be an “outside director” within the meaning of Section 162(m) of the Internal Revenue Code. The board of directors of the company appoints the members of the Compensation Committee and the chairperson of the Compensation Committee. The board of directors of the company may remove any member from the Compensation Committee at any time with or without cause.
Operations
The Compensation Committee meets at least four times a year. Additional meetings may occur as the Compensation Committee or its chairperson deems advisable. The Compensation Committee will cause adequate minutes of all its proceedings to be kept, and will report on its actions and activities at the next quarterly meeting of the board of directors of the company. Compensation Committee members will be furnished with copies of the minutes of each meeting and any action taken by unanimous consent. The Compensation Committee is governed by the same rules regarding meetings (including meetings by conference telephone or similar communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as are applicable to the board of directors of the company. The Compensation Committee is authorized to adopt its own rules of procedure not inconsistent with (a) any provision of this Charter, (b) any provision of the Bylaws of the company, or (c) the laws of the state of Nevada.
Authority
The Compensation Committee will have the resources and authority necessary to discharge its duties and responsibilities. The Compensation Committee has sole authority to retain and terminate outside counsel, compensation consultants retained to assist the Compensation Committee in determining the compensation of the Chief Executive Officer or senior executive officers, or other experts or consultants, as it deems appropriate, including sole authority to approve the firms’ fees and other retention terms. Any communications between the Compensation Committee and legal counsel in the course of obtaining legal advice will be considered privileged communications of the company and the Compensation Committee will take all necessary steps to preserve the privileged nature of those communications.
The Compensation Committee may form and delegate authority to subcommittees and may delegate authority to one or more designated members of the Compensation Committee.
Responsibilities
Subject to the provisions of the Company’s Corporate Governance Guidelines, the principal responsibilities and functions of the Compensation Committee are as follows:
1. Review the competitiveness of the company’s executive compensation programs to ensure (a) the attraction and retention of corporate officers, (b) the motivation of corporate officers to achieve the company’s business objectives, and (c) the alignment of the interests of key leadership with the long-term interests of the company’s shareholders.
2. Review trends in management compensation, oversee the development of new compensation plans, and, when necessary, approve the revision of existing plans.
3. Review and approve the compensation structure for corporate officers at the level of corporate vice president and above.
4. Oversee an evaluation of the performance of the company's executive officers and approve the annual compensation, including salary, bonus, incentive and equity compensation, for the executive officers.
5. Review and approve Chairman and CEO goals and objectives, evaluate Chairman and CEO performance in light of these corporate objectives, and set Chairman and CEO compensation consistent with company philosophy. The CEO may not be present during deliberations or voting concerning the CEO’s compensation. The CEO will be reviewed by the Chairman of the Nominating Committee acting as the Lead Independent Director. The results of the annual CEO evaluation will be considered in setting CEO salary and other compensation.
6. Review and approve compensation packages for new corporate officers and termination packages for corporate officers as requested by management.
7. Review and discuss with the Board and senior officers plans for officer development and corporate succession plans for the CEO and other senior officers.
8. Review and make recommendations concerning long-term incentive compensation plans, including the use of equity-based plans. Except as otherwise delegated by the board of directors of the company, the compensation committee will act on behalf of the board of directors as the “Committee” established to administer equity-based and employee benefit plans, and as such will discharge any responsibilities imposed on the Compensation Committee under those plans, including making and authorizing grants, in accordance with the terms of those plans.
9. Review periodic reports from management on matters relating to the company’s personnel appointments and practices.
10. Produce an annual report of the Compensation Committee on executive compensation for the company’s annual proxy statement in compliance with applicable Securities and Exchange Commission rules and regulations and relevant listing authority.
11. Regularly review and make recommendations about changes to the charter of the Committee.
12. Obtain or perform an annual evaluation of the Compensation Committee’s performance and make applicable recommendations.
Adopted by the Board of Directors on March 23, 2007
WONDER AUTO TECHNOLOGY, INC.
GOVERNANCE AND NOMINATING COMMITTEE CHARTER
The Purpose of the Governance and Nominating Committee
The purpose of the Governance and Nominating Committee of Wonder Auto Technology, Inc. (the “Company”), is to determine the slate of director nominees for election to the Company’s Board of Directors, to identify and recommend candidates to fill vacancies occurring between annual shareholder meetings, to review, evaluate and recommend changes to the Company’s Corporate Governance Guidelines, and to review the Company’s policies and programs that relate to matters of corporate responsibility, including public issues of significance to the Company and its stakeholders.
Membership and Structure
The membership of the Governance and Nominating Committee consists of at least two directors, each of whom shall meet the independence requirements established by the Board of Directors and applicable laws, regulations and listing requirements of the NASDAQ Stock Market, Inc. The Board of Directors of the Company appoints the members of the Governance and Nominating Committee and the chairperson. The Board of Directors of the Company may remove any member from the Governance and Nominating Committee at any time with or without cause.
Operations
The Governance and Nominating Committee meets at least twice a year. Additional meetings may occur as the Governance and Nominating Committee or its chairperson deems advisable. The Governance and Nominating Committee will cause to be kept adequate minutes of all its proceedings, and will report on its actions and activities at the next quarterly meeting of the Board of Directors of the Company. The Governance and Nominating Committee members will be furnished with copies of the minutes of each meeting and any action taken by unanimous consent. The Governance and Nominating Committee is governed by the same rules regarding meetings (including meetings by conference telephone or similar communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as are applicable to the Board of Directors of the Company. The Governance and Nominating Committee is authorized and empowered to adopt its own rules of procedure not inconsistent with (a) any provision of this Charter, (b) any provision of the Bylaws of the Company, or (c) the laws of the state of Nevada.
Authority
The Governance and Nominating Committee will have the resources and authority necessary to discharge its duties and responsibilities. The Governance and Nominating Committee has sole authority to retain and terminate outside counsel, any search firm used to identify director candidates, or other experts or consultants, as it deems appropriate, including sole authority to approve the firms' fees and other retention terms. Any communications between the Governance and Nominating Committee and legal counsel in the course of obtaining legal advice will be considered privileged communications of the Company and the Governance and Nominating Committee will take all necessary steps to preserve the privileged nature of those communications.
The Governance and Nominating Committee may form and delegate authority to subcommittees and may delegate authority to one or more designated members of the Governance and Nominating Committee.
Responsibilities
Subject to the provisions of the Corporate Governance Guidelines, the principal responsibilities and functions of the Governance and Nominating Committee are as follows:
1. Annually evaluate and report to the Board of Directors of the Company on the performance and effectiveness of the Board of Directors to facilitate the directors fulfilling their responsibilities in a manner that serves the interests of the Company’s shareholders.
2. Annually present to the Board of Directors a list of individuals recommended for nomination for election to the Board of Directors of the Company at the annual meeting of shareholders, and for appointment to the committees of the Board of Directors (including this Governance and Nominating Committee).
3. Before recommending an incumbent, replacement or additional director, review his or her qualifications, including capability, availability to serve, conflicts of interest, and other relevant factors.
4. Assist in identifying, interviewing and recruiting candidates for the Board of Directors.
5. Annually review the composition of each committee and present recommendations for committee memberships to the Board of Directors of the Company as needed.
6. Periodically review the compensation paid to non-employee directors for annual retainers (including the Board of Directors of the Company and committee Chairs) and meeting fees, if any, and make recommendations to the Board of Directors for any adjustments. No member of the Governance and Nominating Committee will act to fix his or her own compensation except for uniform compensation to directors for their services as such.
7. Develop and periodically review and recommend to the board appropriate revisions to the Company's Corporate Governance Guidelines.
8. Monitor compliance with the Corporate Governance Guidelines.
9. Regularly review and make recommendations about changes to the charter of the Governance and Nominating Committee.
10. Regularly review and make recommendations about changes to the charters of other board committees after consultation with the respective committee chairs.
11. Obtain or perform an annual evaluation of the Governance and Nominating Committee's performance and make applicable recommendations.
12. Assist the Chairman of the Board of Directors of the Company, if the Chairman is a non-management director, or otherwise the Chairman of the Governance and Nominating Committee acting as Lead Independent Director, in leading the Board of Directors’ annual review of the Chief Executive Officer’s performance.
Adopted by the Board of Directors on March 23, 2007
CODE OF ETHICS
OF
WONDER AUTO TECHNOLOGY, INC.
I. Objectives
Wonder Auto Technology, Inc. (the “Company”) is committed to the highest level of ethical behavior. The Company’s business success depends upon the reputation of the Company and its directors, officer and employees to perform with the highest level of integrity and principled business conduct.
This Code of Ethics (“Code”) applies to all directors, officers and employees of the Company, including the Company's principal executive officer and principal financial officer, (collectively, the “Covered Persons”). This Code is designed to deter wrongdoing and to promote all of the following:
honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
full, fair, accurate, timely, and understandable disclosure in reports and documents that the Company files with, or submits to, the Securities and Exchange Commission (the "Commission"), and in other public communications made by the Company;
compliance with applicable governmental laws, rules and regulations;
the prompt internal reporting to an appropriate person or persons identified herein for receiving notice of violations or potential violations of this Code; and
accountability for adherence to this Code.
Current versions of the Code will be maintained on the Company’s Website and distributed periodically to all Covered Persons. Compliance with the Code is, first and foremost, the individual responsibility of every Covered Person.
This Code is not intended to cover every applicable law, or to provide answers to all questions that might arise; for such, the Company relies on each person’s sense of what is right, including a sense of when it is appropriate to seek guidance from others on an appropriate course of conduct.
II. Honest And Ethical Conduct
Each Covered Person must always conduct himself or herself in an honest and ethical manner. Each Covered Person must act with the highest standards of personal and professional integrity and must not tolerate others who attempt to deceive or evade responsibility for actions. Honest and ethical conduct must be a driving force in every decision made by a Covered Person while performing his or her duties for the Company. When in doubt as to whether an action is honest and ethical, each Covered Person shall seek advice from his or her immediate supervisor or senior management, as appropriate.
III. Conflicts Of Interest
The term “conflict of interest” refers to any circumstance that would cast doubt on a Covered Person’s ability to act objectively when representing the Company’s interest. Covered Persons should not use their position or association with the Company for their own or their family’s personal gain, and should avoid situations in which their personal interests (or those of their family) conflict or overlap, or appear to conflict or overlap, with the Company’s best interests.
The following are examples of activities that give rise to a conflict of interest. These examples do not in any way limit the general scope of the Company's policy regarding conflicts of interest.
Where a Covered Person’s association with (or financial interest in) another person or entity would reasonably be expected to interfere with the Covered Person's independent judgment as to the Company’s best interest, that association or financial interest creates a conflict of interest.
The holding of a financial interest by a Covered Person in any present or potential competitor, customer, supplier, or contractor of the Company creates a conflict of interest, except where the business or enterprise in which the Covered Person holds such financial interest is publicly owned, and the financial interest of the Covered Person in such public entity constitutes less than one percent (1%) of the ownership of that business or enterprise.
The acceptance by a Covered Person of a membership on the board of directors, or serving as a consultant or advisor to any board or any management, of a business that is a present or potential competitor, customer, supplier, or contractor of the Company, creates a conflict of interest, unless such relationship is pre-approved in writing by the principal executive officer of the Company.
Engaging in any transaction involving the Company, from which the Covered Person can benefit financially or otherwise, apart from the usual compensation received in the ordinary course of business, creates a conflict of interest. Such transactions include lending or borrowing money, guaranteeing debts, or accepting gifts, entertainment, or favors from a present or potential competitor, customer, supplier, or contractor of the Company.
The use or disclosure of any unpublished information regarding the Company, obtained by a Covered Person in connection with his or her employment for personal benefit, creates a conflict of interest.
It is our policy and it is expected that all Covered Persons should endeavor to avoid all situations that present an actual or apparent conflict of interest. All actual or apparent conflicts of interest must be handled honestly and ethically. If a Covered Person suspects that he or she may have a conflict of interest, that Covered Person is required to report the situation to, and to seek guidance from, his or her immediate supervisor or senior management, as appropriate. For purposes of this Code, directors, the principal executive officer, and the principal financial officer shall report any such conflict or potential conflict situations to the chairman of the audit committee, if one be created, and in the absence of an audit committee, to chairman of the board of directors. Officers (other than the principal executive officer and principal financial officer) and employees of the Company shall report any such situations to their immediate supervisor. It is the responsibility of the audit committee chairman or the chairman of the board, as applicable, to determine if a conflict of interest exists or whether such situation is likely to impair the Covered Persons ability to perform his or her assigned duties with the Company, and if such situation is determined to present a conflict, to determine the necessary resolution.
IV. Compliance With Applicable Laws, Rules And Regulations
Full compliance with letter and the spirit of all applicable governmental laws, rules and regulations, and applicable rules and listing standards of any national securities exchange on which the Company’s securities may be listed, is one of the foundations on which this Company’s ethical policies are built. All directors and executive officers of the Company must understand and take responsibility for the Company's compliance with the applicable governmental laws, rules and regulations of the cities, states and countries in which the Company operates, and for complying with the applicable rules and listing standards of any national securities exchange on which the Company’s securities may be listed.
V. Rules To Promote Full, Fair, Accurate, Timely and Understandable Disclosure
As a public Company, the Company has a responsibility to report financial information to security holders so that they are provided with accurate information in all material respects about the Company’s financial condition and results of operations. It is the policy of the Company to fully and fairly disclose the financial condition of the Company in compliance with applicable accounting principles, laws, rules and regulations. Further, it is the Company’s policy to promote full, fair, accurate, timely and understandable disclosure in all Company reports required to be filed with or submitted to the Commission, as required by applicable laws, rules and regulations then in effect, and in other public communications made by the Company.
Covered Persons may be called upon to provide or prepare necessary information to ensure that the Company’s public reports are complete, fair and understandable. The Company expects Covered Persons to take this responsibility seriously and to provide accurate information related to the Company’s public disclosure requirements.
All books and records of the Company shall fully and fairly reflect all Company transactions in accordance with accounting principles generally accepted in the United States of America, and any other financial reporting or accounting regulations to which the Company is subject. No entries to the Company’s books and records shall be made or omitted to intentionally conceal or disguise the true nature of any transaction. Covered Persons shall maintain all Company books and records in accordance with the Company’s established disclosure controls and procedures and internal controls for financial reporting, as such controls may be amended from time to time.
All Covered Persons must report any questionable accounting or auditing matters that may come to their attention. This applies to all reports or records prepared for internal or external purposes. If any Covered Person has concerns or complaints regarding questionable accounting or auditing matters of the Company, Covered Person shall report such matters to his or her immediate supervisor. If the immediate supervisor is involved in the questionable accounting or auditing matter, or does not timely resolve the Covered Person’s concern, the Covered Person should submit their concerns to the principal executive officer or the principal financial officer. If the principal executive officer and the principal financial officer are involved in the questionable accounting or auditing matter, or do not timely resolve the Covered Person's concerns, the Covered person should submit his or her concern directly to the audit committee, if one be established, or to the board of directors in the absence of a designated audit committee. The reporting of any such matters may be done on a confidential basis, at the election of the Covered Person making the report.
VI. Corporate Opportunities
Directors and employees are prohibited from taking for themselves opportunities that are discovered through the use of Company property, information or position, or using Company property, information or position for personal gain. Directors and employees have a duty to the Company to advance its legitimate interest when the opportunity to do so arises.
VII. Confidentiality
Directors and employees must maintain the confidentiality of non-public, proprietary information regarding the Company, its customers or its suppliers, and shall use that information only to further the business interests of the Company, except where disclosure or other use is authorized by the Company or legally mandated. This includes information disseminated to employees in an effort to keep them informed or in connection with their work activities, but with the instruction, confidential labeling, or reasonable expectation that the information be kept confidential.
VIII. Trading on Inside Information
Inside information includes any non-public information, whether favorable or unfavorable, that investors generally consider important in making investment decisions. Examples including financial results not yet released, imminent regulatory approval/disapproval of an alliance or other significant matter such as the purchase or sale of a business unit or significant assets, threatened litigation, or other significant facts about a business. No information obtained as the result of employment at, or a director’s service on the Board of, the Company may be used for personal profit or as the basis for a “tip” to others, unless such information has previously been made generally available to the public, and even in such circumstances, such information may be subject to other duties.
IX. Protection and Proper Use of Company Assets
Directors and employees should protect the Company’s assets and ensure their efficient use. Theft, carelessness and waste have an adverse impact on the Company and its profitability. Company assets may only be used for legitimate Company business purposes.
X. Reporting Violations of the Code
Any Covered Person who becomes aware of any violation of this Code must promptly bring the violation to the attention of the appropriate party as follows: directors, the Company’s principal executive officer and the principal financial officer shall report on a confidential basis any violations to the chairman of the audit committee, if one be created, and in the absence of an audit committee, to the chairman of the board of directors of the Company; Executive officers and employees of the Company shall report any violations to the Company’s principal executive officer or principal financial officer.
XI. Compliance with the Code
All issues of non-compliance with this Code will be reviewed and evaluated according to the circumstances and severity of the problem. Senior management will take such actions as it deems appropriate, which can include disciplinary action up to and including termination of employment, legal action, and other measures.
XII. Waiver of the Code
Any waiver of this Code may be made only by the independent directors on the board of directors, or by an authorized committee of the board of directors comprised solely of independent directors, and will be disclosed as required by law, Commission regulations, or the rules and listing standards of any national securities exchange on which the Company’s securities may be listed.
Adopted by the Board of Directors on March 23, 2007
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