1. Introduction

 

This Code of Ethics applies to all of Neoware’s (the “Company”) full-time, part-time and contract employees, as well as our officers and directors. We require the highest standards of professional and ethical conduct from our employees, officers and directors. Our reputation for honesty and integrity among our customers, employees, vendors, and stockholders is key to the success of our business. No employee, officer or director will be permitted to achieve results through violations of laws or regulations, or through unscrupulous dealings.

 

This Code reflects our commitment to a culture of honesty, integrity and accountability and outlines the basic principles and policies with which all employees, officers and directors are expected to comply. Please read this Code carefully.

 

In addition to following this Code in all aspects of your business activities, you are expected to seek guidance in any case where there is a question about compliance with both the letter and spirit of our policies and applicable laws. This Code sets forth general principles and does not supersede the specific policies and procedures that are covered in the Insider Trading Policy. References in this Code of Ethics to the Company means the Company or its subsidiaries.

 

Your cooperation is necessary to the continued success of our business and the cultivation and maintenance of our reputation as a good corporate citizen. Any questions or concerns regarding anything contained in this Code should be directed to the General Counsel, who will be responsible for administering the Code.

 

 

  

2. Complying with Laws

   

All employees, officers and directors of the Company must respect and comply with all of the laws, rules and regulations of the U.S. and other countries, and the states, counties, cities and other jurisdictions, in which the Company conducts its business or the laws, rules and regulations that are applicable to the Company. Employees, officers and directors who fail to comply with this Code and applicable laws will be subject to disciplinary measures, up to and including immediate discharge from the Company.

 

Such legal compliance must include, without limitation, compliance with the "insider trading" prohibitions applicable to the Company and its employees, officers and directors. Generally, employees, officers and directors who possess material confidential or non-public information from or about the Company are not permitted to buy, sell or otherwise trade in the Company's securities, whether or not they are using or relying upon that information. This restriction extends to sharing or tipping others about such information, especially as the individuals receiving such information might utilize such information to trade in the Company's securities. The Company’s insider trading policy restricts trading in its securities and in the securities of any other company, including our customers, suppliers or companies engaging in other transactions with the Company, if employees have material, non-public information about that company which the employee obtained in the course of their employment by the Company. Company employees, officers and directors are directed to the Company's Insider Trading Policy if they have questions regarding the applicability of such insider trading prohibitions.

 

This Code of Ethics does not summarize all laws, rules and regulations applicable to the Company and its employees, officers and directors. Please consult the General Counsel if you have any questions with respect to specific laws, rules and regulations.

 

 

  

3. Honest and Ethical Conduct; Conflicts of Interest

   

Conflicts of interest are prohibited as a matter of Company policy. All employees, officers and directors of the Company should engage in and promote honest and ethical conduct and be scrupulous in avoiding a conflict of interest or the appearance of a conflict of interest with regard to the Company's interests. A "conflict of interest" exists whenever an individual's private interests interfere or conflict in any way with the interests of the Company. A conflict situation can arise when an employee, officer or director takes actions or has interests that may make it difficult to perform his or her Company work objectively and effectively. Conflicts of interest may also arise when an employee, officer or director, or a member of his or her family, receives improper personal benefits as a result of his or her position in the Company, whether received from the Company or a third party. Loans to, or guarantees of obligations of, employees, officers and directors and their respective family members may create conflicts of interest. Federal law prohibits loans to directors and executive officers.

 

Conflicts of interest may not always be clear-cut, so if you have a question, you should consult with higher levels of management or the General Counsel. Any employee, officer or director who becomes aware of a conflict or potential conflict should bring it to the attention of a supervisor, manager or other appropriate personnel.

 

 

  

4. Corporate Opportunity

   

Employees, officers and directors are prohibited from (a) taking for themselves personally opportunities that properly belong to the Company or are discovered through the use of corporate property, information or position; (b) using corporate property, information or position for personal gain; and (c) competing with the Company. Employees, officers and directors owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises.

  

5. Confidentiality

   

Employees, officers and directors of the Company must maintain the confidentiality of confidential information entrusted to them by the Company or its suppliers, potential business partners or customers, except when disclosure is authorized by the Company or required by laws, regulations or legal proceedings. Whenever feasible, employees, officers and directors should consult the Company’s General Counsel if they believe that they have a legal obligation to disclose confidential information. The obligation to preserve confidential information continues even after you leave the Company. Any documents, papers or records that contain trade secrets or proprietary information are our property, and must remain at the company. We remind you that you have previously signed, as a condition of your employment, a Non-Disclosure and Confidentiality Agreement, an Employment Agreement or other similar agreement that governs your obligations with respect to our information.

Confidential information includes all non-public information that might be of use to competitors of the Company, or harmful to the Company or its customers if disclosed Our confidential trade secrets and proprietary information may include, among other things, information relating to the Company’s customers, products, processes, and services, operations, research, development, source codes, object codes or other technology-based information, trade secrets, inventions, strategies, sources of supplies and materials, data, records and any proprietary information. It also includes information that suppliers, potential business partners and customers have entrusted to us.

 

 

  

6. Fair Dealing

   

Each employee, officer and director should endeavor to deal fairly with the Company's customers, suppliers, competitors, officers and employees. None should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair dealing practice.

  

7. Protection and Proper Use of Company Assets

   

All employees, officers and directors should protect the Company's assets and ensure their efficient use. Theft, carelessness, and waste have a direct impact on the Company's profitability. Any suspected incidents of fraud, theft or waste should be immediately reported to your supervisor or the General Counsel for investigation. All Company assets should be used for legitimate business purposes. Company assets may never be used for illegal purposes.

 

The obligation to protect Company assets includes proprietary information. Proprietary information includes any information that is not generally known to the public or would be helpful to our competitors. Examples of proprietary information are intellectual property, business and marketing plans and employee information. The obligation to preserve proprietary information continues even after you leave the Company

 

 

  

8. Accounting Complaints

   

The Company's policy is to comply with all financial reporting and accounting regulations applicable to the Company. If any employee, officer or director of the Company has concerns or complaints regarding questionable accounting, internal accounting controls or auditing matters of the Company, he or she is encouraged to submit those concerns or complaints to the Chairman of the Audit Committee of the Board of Directors of the Company at the address, telephone number or e-mail address set forth in the Company’s Statement of Reporting Ethical Violations. The confidentiality of all such complaints and concerns submitted by employees will be protected, including keeping the identity of the person submitting the complaint anonymous, subject to applicable law, regulation or legal proceedings. Any other complaints received by the Company regarding accounting, internal accounting controls or auditing matters will be forwarded to the Chairman of the Audit Committee for investigation. The Company’s Disclosure Committee, which is responsible for reviewing the Company’s public filings, will review complaints made by employees or others regarding accounting, internal accounting controls or auditing matters.

  

9. Reporting any Illegal or Unethical Behavior and Violations of this Code

   

Employees are encouraged to talk to supervisors, managers or other appropriate personnel about observed illegal or unethical behavior or violations of this Code and, when in doubt, about the best course of action in a particular situation. Employees, officers and directors who are concerned that violations of this Code or that other illegal or unethical conduct by employees, officers or directors of the Company have occurred or may occur should either contact their supervisors or superiors. If they do not believe it appropriate or are not comfortable approaching their supervisors or superiors about their concerns or complaints, they may contact the General Counsel, the Chief Executive Officer or the Chairman of the Audit Committee of the Board of Directors of the Company at the addresses, telephone numbers or e-mail addresses set forth in the Company’s Statement of Reporting Ethical Violations. All letters, e-mail and transcripts of telephone calls will be kept in confidence and acted upon only by designated personnel unless disclosure is required or deemed advisable in connection with any governmental investigation or report, in the interest of the Company, or in the Company’s legal handling of the matter.

  

10. No Retaliation

   

The Company will not permit retaliation of any kind by or on behalf of the Company and its employees, officers and directors against any employee who provides information or otherwise assists in federal or authorized Company investigations by a person with supervisory authority over the employee of conduct which such person reasonably believes constitutes mail fraud, wire, radio or television fraud, bank fraud, federal securities laws violations or fraud against shareholders under any other federal laws, or who files, participates in or assists in a proceeding filed or about to be filed relating to any such violations, or in good faith submits reports or complaints of violations of this Code or other illegal or unethical conduct.

 

The Company’s General Counsel will be responsible for administering and overseeing the Company’s non-retaliation policy, including (i) the collection, prompt review, resolution and retention of employee and other complaints and (ii) being available to discuss with employees complaints raised or reports submitted. Our General Counsel will be responsible for administering procedures regarding the collection, review, resolution and retention of employee complaints and being available to discuss with employees complaints raised or reports submitted.

 

 

  

11. Public Company Reporting

   

As a public company, it is of critical importance that the Company's filings with, and submissions to, the Securities and Exchange Commission and other public communications made by the Company be full, fair, accurate, timely and understandable. Depending on his or her position with the Company, an employee, officer or director may be called upon to provide necessary information to assure that the Company's public reports are complete, fair, accurate, timely and understandable. The Company expects employees, officers and directors to take this responsibility very seriously and to provide prompt accurate answers to inquiries related to the Company's public disclosure requirements. The Chief Executive Officer, and the Chief Financial Officer and the Controller (the “Senior Financial Officers”) must exercise the highest standard of care in preparing the Company’s filings, submissions and other public communications in accordance with the following guidelines:

 

All Company accounting records, as well as reports produced from those records, must be kept and presented in accordance with the laws of each applicable jurisdiction;

 

All records must fairly and accurately reflect the transactions or occurrences to which they relate;

 

All records must fairly and accurately reflect in reasonable detail the Company’s assets, liabilities, revenues and expenses;

 

The Company’s accounting records must not contain any false or intentionally misleading entries;

 

No transactions should be intentionally misclassified as to accounts, departments or accounting periods;

 

All transactions must be supported by accurate documentation in reasonable detail and recorded in the proper account and in the proper accounting period;

 

No information should be concealed from the Company’s finance department or outside auditors; and

 

The Company’s accounting records must at all times comply with Generally Accepted Accounting Principles and the Company’s system of internal accounting controls.

 

  

12. Amendment, Modification and Waiver

   

Any amendment (other than a technical or non-substantive amendment) to this Code may only be made by the Board of Directors or a Board Committee, and waivers for executive officers or directors may only be made by the Board of Directors or a Board Committee. Such amendments and waivers will be subject to the disclosure and other provisions of the Securities Exchange Act of 1934, and the rules thereunder, and the applicable rules of the Nasdaq Stock Market.