Insider Trading Policies and Procedures


All employees of the Company are prohibited from trading the Company's stock, for themselves, family members, friends or any other person while in possession of material, nonpublic (inside) information concerning the Company. In addition, the following activities are absolutely prohibited: (1) tipping or communication of inside information other than for lawful, authorized corporate purposes; (2) recommending the purchase or sale of Company stock, unless all inside information relating to the Company is fully disclosed to the person on the other side of the transaction and to the public at large; and (3) knowingly assisting someone engaged in any of these activities.

All information relating to the Company's activities is proprietary to the Company and must be kept confidential. Such information includes, for example, earnings estimates (including changes of previously announced estimates), changes or curtailments of operations of significant facilities, increases or declines in business, proposed mergers or acquisitions, actions by regulatory bodies, management changes, litigation involving the Company, purchases or sales of assets, redemption of the Company's stock and plans to grant dividends or increase or decrease dividend amounts. Where such information is material, it should be treated as inside information; that is, you must not trade on it for your own account or the accounts of others, and you must not disclose it to anyone inside the Company who does not need the information in the course of our business.

The bold-faced terms in the above paragraphs have legal definitions developed by the Securities and Exchange Commission (the "SEC") and the courts; a brief discussion of each term appears below under "Key Terms and Concepts". Each employee should review our policy and the defined terms carefully; any questions should be directed to the Vice President of Finance, the Chief Financial Officer or the Chief Executive Officer at the Home Office.

Key Terms and Concepts

"Inside information" is information that has, as its source, corporate insiders. "Insiders" of the Company are its officers, directors, certain employees and controlling shareholders, and their close friends and relatives. Individuals and entities outside the Company who gain inside information in the course of dealings with The Company (such as investment bankers, lawyers and accountants) may be legally considered "temporary" or "constructive" insiders of the corporation and thus be bound by the same legal restrictions as traditional insiders. IF YOU RECEIVE MATERIAL, NONPUBLIC INFORMATION THAT COMES DIRECTLY OR INDIRECTLY FROM ANY CORPORATE INSIDER (temporary or traditional), DO NOT BUY OR SELL OR OTHERWISE TRADE IN THE COMPANY'S STOCK, FOR YOURSELF OR ANY OTHER PERSON, WITHOUT FIRST CONSULTING THE VICE PRESIDENT OF FINANCE, THE CHIEF FINANCIAL OFFICER OR THE CHIEF EXECUTIVE OFFICER.

"Tipping" is the disclosure of information about the Company or its stock to a third party, when such disclosure is not made strictly for corporate purposes. The disclosure may be made by a Company insider (the "tipper") or by anyone who receives information traceable to an insider. Those who receive the information are called "tippee". Criminal and civil liability for trading on the basis of tipped information may apply even where the information is received second or third-hand or, more remotely, if the other requirements for finding liability are present. The same legal standards apply to remote tippees. DO NOT DISCLOSE MATERIAL, NONPUBLIC INFORMATION TO ANYONE EXCEPT AS REQUIRED BY THIS POLICY. YOU AND THE COMPANY MAY BE LIABLE IF ANYONE TRADES ON MATERIAL INSIDE INFORMATION RECEIVED FROM OR THROUGH YOU.

Trading on inside information is illegal if the information is "material". "Material" information is information about the Company or its stock that could be expected to affect the judgment of reasonable investors whether to buy, sell or hold the Company's stock. It is information that, if generally known, would affect the market price of the Company's stock. If a transaction you are involved in becomes the subject of scrutiny by the SEC or a court, the materiality of any inside information will be evaluated with 20/20 hindsight, and the mere fact that someone traded on the basis of the information will contribute to the conclusion that it was material. WHEN IN DOUBT, ASSUME INFORMATION IS MATERIAL.

It is only illegal to trade on material information if it is "nonpublic". "Nonpublic" information is information that has not been disseminated in a manner that makes it available to public investors generally. Information that has been selectively disclosed to a few analysts or investors is also not public. Public information has been effectively disclosed in a manner sufficient to ensure that it is available to the investing public, such as by publication in the Dow Jones broad tape, Reuters Economic Services, the Associated Press or United Press International wire services, or newspapers of general circulation in New York City or San Francisco. Once information becomes public, insiders and tippees must wait to trade until the market absorbs the information; the waiting period is at least twenty-four hours and, in some situations, longer. Any questions concerning whether certain information has become public should be referred to the Vice President of Finance, the Chief Financial Officer or the Chief Executive Officer.


Employees who trade on inside information, or tip such information to others who trade, are subject to a civil penalty of the greater of $1,000,000 or up to three times the profit gained or the loss avoided, a criminal fine of up to $1,000,000 (regardless of the profit gained or loss avoided), and a jail term of up to ten years. The Company or any supervisor who fails to take adequate steps to prevent illegal trading on, or tipping of, inside information is subject to a civil penalty of the greater of $1,000,000 or up to three times the profit gained or loss avoided as a result of the employee's violation, a criminal penalty of up to $1,000,000 for individuals, and up to $2,500,000 for other persons, and, for individuals, a jail term of up to ten years. Persons guilty of insider trading violations, whether through actual trading, tipping, or failing to supervise, are also open to private suits for damages by contemporaneous traders in the market.

Any violation by any employee of the Company's policies and procedures set forth in this document may result in dismissal for cause, suspension without pay, loss of pay or bonus, loss of severance benefits, demotion or other sanctions, whether or not any such violation also constitutes a violation of law. Furthermore, the Company may initiate or cooperate in civil or criminal proceedings against any employee relating to, or arising from, any such violation. Any SEC investigation, even one that does not result in criminal or civil prosecution, can irreparably damage the Company's reputation and the employee's career. It is essential to avoid even the appearance of impropriety.


If, at any time, you believe that you may have come into possession of material, nonpublic information, the following procedures must be followed:

  1. Immediately cease all trading in stock of the Company, including in any accounts in which you have any interest or over which you have discretion.
  2. Immediately cease recommending any transaction in the stock of the Company to anyone, including your business associates, friends or relatives. This prohibition includes making any comment about the Company that could, in any way, be interpreted as a recommendation.
  3. Immediately inform the Chief Financial Officer of all details of the situation, so that appropriate security procedures can be implemented company-wide. Do not discuss the inside information with anyone except as required by these policies, and especially avoid referring to the information in hallways, elevators, restaurants, taxis or any other place where you may be overheard.

Restricted Trading Periods (Trading Windows)

Any Insider must contact either the Vice President of Finance, the Chief Financial Officer or the Chief Executive Officer before trading in Company stock or stock options. Please indicate the number of shares or options to be purchased or sold. Also, you must notify the Vice President of Finance or the Chief Financial Officer when you have completed the transaction.

Further, to facilitate compliance with trading regulations, the Company has established restricted trading periods or trading windows. The trading window is open starting on the third day after the Company's quarterly earnings release and remains open until the fifteenth day of the last month in the calendar quarter. The trading window is closed (no trading is allowed) from the sixteenth day of the last month of each calendar quarter until the third day following the earnings release. Further, the Company may close the trading window at any time if there is material information that could affect trading in Company stock. In this circumstance, the trading window will not reopen until after the material information has been made public.

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