An employee who tips information to a person who then trades is subject to the same
penalties as the tippee, even if the employee did not trade and did not profit from the
Control Persons. The Company and its supervisory personnel, if they fail to take appropriate steps to prevent illegal insider trading, are subject to the following penalties:
Company-Imposed Sanctions. An employee's failure to comply with the Company's
insider trading policy may subject the employee to Company-imposed sanctions,
including dismissal for cause, whether or not the employee's failure to comply results in a
violation of law. Needless to say, a violation of law, or even an SEC investigation that
does not result in prosecution, can tarnish one's reputation and irreparably damage a
Statement of Policy
It is the policy of the Company that no director, officer or other employee of the Company or any of the Company’s affiliates (a “Covered Person”) who is aware of material nonpublic information relating to the Company may, directly or through family members or other persons or entities, (a) buy or sell securities of the Company (other than pursuant to a pre-approved trading plan that complies with SEC Rule 10b5-1), or engage in any other action to take personal advantage of that information, or (b) pass that information on to others outside the Company, including family and friends. In addition, it is the policy of the Company that no Covered Person who, in the course of working for or on behalf of the Company, learns of material nonpublic information about a company with which the Company does business, including a customer or supplier of the Company, may trade in that company's securities until the information becomes public or is no longer material.
Transactions that may be necessary or justifiable for independent reasons (such as the need to raise money for an emergency expenditure) are not exempt from the policy. The securities laws do not recognize such mitigating circumstances, and, in any event, even the appearance of an improper transaction must be avoided to preserve the Company’s reputation for adhering to the highest standards of conduct.
Disclosure of Information to Others. The Company has established procedures for releasing material information about the Company in a manner that is designed to achieve broad public dissemination of the information immediately upon its release. You may not, therefore, disclose information to anyone outside the Company, including family members and friends, other than in accordance with those procedures. You also may not discuss the Company or its business in an internet "chat room" or similar internet-based forum.
Material Information. Material information is any information that a reasonable investor would consider important in making a decision to buy, hold, or sell securities. Any information that could be expected to affect the Company's stock price, whether it is positive or negative, should be considered material. Some examples of information that ordinarily would be regarded as material are:
"20-20" Hindsight. Remember, anyone scrutinizing your transactions will be doing so
after the fact, with the benefit of hindsight. As a practical matter, before engaging in any
transaction, you should carefully consider how enforcement authorities and others might
view the transaction in hindsight.
When Information is "Public" If you are aware of material nonpublic information, you may not trade until the information has been disclosed broadly to the marketplace (such as by press release or an SEC filing) and the investing public has had time to absorb the information fully. To avoid the appearance of impropriety, as a general rule, information should not be considered fully absorbed by the marketplace until the third trading day after the information is released. If, for example, the Company were to make an announcement on a Monday, you should not trade in the Company's securities until Thursday. If an announcement were made on a Friday, Wednesday generally would be the first eligible trading day.
Transactions by Family Members. The insider trading policy also applies to your family members who reside with you, anyone else who lives in your household, and any family members who do not live in your household but whose transactions in securities are directed by you or are subject to your influence or control (such as parents or children who consult with you before they trade in securities). You are responsible for the transactions of these other persons and therefore should make them aware of the need to confer with you before they trade in the Company's securities.
Transactions under Future Company Plans
Stock Option Exercises. The Company's insider trading policy does not apply to the exercise of an employee stock option. The policy does apply, however, to any sale of stock as part of a broker-assisted cashless exercise of an option, or any other market sale for the purpose of generating the cash needed to pay the exercise price of an option.
Trading Windows and Blackout Periods
Trading Windows. A Covered Person may trade in Company securities only during the period beginning at the opening of trading on the third full trading day following the Company's widespread public release of quarterly or year-end operating results, and ending at the close of trading on the 30th day following the end of the next quarter (or, if such 30th day is not a trading day, on the next trading day), as long as the Covered Person is not in possession of material nonpublic information or subject to any special trade blackout.
No Trading During Trading Windows While in the Possession of Material Nonpublic Information. No Covered Person possessing material nonpublic information concerning the Company may trade in Company securities even during applicable trading windows. Persons possessing such information may trade during a trading window only after the opening of trading on the third full trading day following the Company's widespread public release of the information.
No Trading During Blackout Periods. No Covered Person may trade in Company securities outside of the applicable trading windows or during any special blackout periods that the Company’s CEO may designate. In addition, no Covered Person may disclose to any outside third party that a special blackout period has been designated.
Pre-Clearance by CEO. All transactions by a Covered Person must be cleared in advance by the Company’s CEO.
Exception for Transfers Pursuant to Rule 10b5-1
Blackout periods shall not prohibit transfers of Company securities made pursuant to a written contract, letter of instruction or plan that (a) complies with the requirements of SEC Rule 10b5-1 (a "Rule 10b5-1 Plan"), (b) has been approved by the Company’s CEO in advance of the first trade thereunder and (c) with respect to which the Company's CEO has received certification from such Covered Person that (i) such Covered Person was not in possession of material nonpublic information about the Company at the time the Rule 10b5-1 Plan was adopted and that all trades made under the Rule 10b5-1 Plan will comply with Rule 10b5-1 Plan and applicable securities laws and (ii) the Rule 10b5-1 Plan complies with the requirements of Rule 10b5-1. No such approval by the CEO shall be considered the CEO's or the Company's determination that the Rule 10b5-1 Plan satisfies the requirements of Rule 10b5-1. It shall be the sole responsibility of the person establishing the Rule 10b5-1 Plan to ensure that such plan complies with the requirements of Rule 10b5-1.
Post-Termination Transactions. This Policy Statement will continue to apply to your transactions in Company securities even after you have terminated your employment with or position as a director of the Company or its affiliates. If you are in possession of material nonpublic information when your employment or directorship terminates, you may not trade in Company securities until that information has become public or is no longer material.