Exhibit 1.01
Dolby Laboratories, Inc.
Conflict Minerals Report
For The Year Ended December 31, 2013
This Conflict Minerals Report (the “Report”) of Dolby Laboratories, Inc. (“Dolby” or the “Company”) has been prepared pursuant to Rule 13p-1 and Form SD (the “Rule”) promulgated under the Securities Exchange Act of 1934, as amended, for the reporting period January 1, 2013 to December 31, 2013. The Rule requires disclosure of certain information when a company manufactures or contracts to manufacture products and the minerals specified in the Rule are necessary to the functionality or production of those products. The specified minerals referred to as “Conflict Minerals” are gold, columbite-tantalite (coltan), cassiterite and wolfamite, including their derivatives which include tantalum, tin and tungsten. The “Covered Countries” for purposes of the Rule and this Report are the Democratic Republic of Congo, the Republic of Congo, the Central African Republic, South Sudan, Uganda, Rwanda, Burundi, Tanzania, Zambia and Angola.
As described in this Report, we have determined that certain Conflict Minerals are necessary to the functionality or production of products manufactured or contracted to be manufactured by us during calendar year 2013. These products are referred to in this Report as “Covered Products.” As a result, we have conducted a reasonable country of origin inquiry (“RCOI”) reasonably designed to determine if any of these Conflict Minerals originated in the Covered Countries. Our RCOI primarily consisted of submitting the Conflict Minerals reporting questionnaire prepared by the Electronic Industry Citizenship Coalition and Global eSustainability Initiative (“EICC-GeSI”) to our contract manufacturers and suppliers of components received in 2013. Responses were reviewed for completeness and consistency, and we routinely followed up with our contract manufacturers and component suppliers for corrections and clarifications as needed. Based on our RCOI, we believe that certain of the Conflict Minerals used in our products may have originated in the Covered Countries. Based on this information, we performed additional due diligence on the source and chain of custody of these Conflict Minerals based on the Organisation for Economic Co-operation and Development (“OECD”) Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (“Framework”) to determine if the Conflict Minerals that may have originated in the Covered Countries benefited armed groups. As such, we believe our process was reasonably designed and performed in good faith. After performing the RCOI and due diligence in conformity with the Framework, we were unable to comprehensively determine the origin of all Conflict Minerals used in our products, the facilities used to process them, their country of origin, and their mine or location of origin.
Product Descriptions of Covered Products
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Product | Description |
Digital Cinema Products | Digital Cinema Products are used for digital encoding, distribution, and playback. Our digital cinema server is used to load, store, decrypt, decode, and re-encrypt digital film files for presentation on digital cinema projectors. We also provide products that encrypt, encode, and package digital films, and digital cinema processors to decode digital cinema soundtracks.
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Film-based Cinema Products | Film-based Cinema Processors are used to read, decode and playback a film soundtrack and calibrate the sound system in a movie theater.
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Professional Reference Monitors | Professional Reference Monitor is a video monitor used during the production and post-production of cinematic and video content in situations where grade 1 reference performance is required.
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Broadcast Products | Broadcast Products are used to encode, transmit, and decode multiple channels of high quality audio for DTV and HDTV program production and broadcast distribution, and to measure the loudness of broadcast audio content.
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Digital 3D Products | Digital 3D Products deliver a 3D image with an existing digital cinema server and white (or silver) screen. Our Dolby 3D glasses feature high quality multicoated lenses that deliver sharp 3D images.
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RCOI
Our RCOI primarily consisted of submitting the EICC-GeSI Conflict Minerals questionnaire to all of our contract manufacturers and suppliers of components purchased in 2013. We submitted this questionnaire to 47 contract manufacturers and component suppliers. We did not receive complete responses to the questionnaire from 9 of these contract manufacturers and suppliers (19%). Of the responses received, four suppliers indicated that they source Conflict Minerals from the Covered Countries. Based on these four responses, we believe that certain of the Conflict Minerals used in our products may have originated in the Covered Countries.
Due Diligence
Dolby assembled a Conflict Minerals project team with representatives from Engineering, Legal, and Procurement to develop and execute its Conflict Minerals program. Dolby adopted a Conflict Minerals Policy (available at http://www.dolby.com/us/en/about-us/who-we-are/conflict-minerals-policy.html) that provides our commitment to minimizing the use of Conflict Minerals that finance or benefit armed groups. We actively engage with our suppliers to promote responsible sourcing practices including promoting practices that avoid sources of Conflict Minerals that benefit armed groups. We encourage suppliers to seek conflict-free sources for Conflict Minerals used in our products that are certified as conflict-free by participating in a third party audit such as that provided by the Conflict-Free Smelter Program (“CFSP”). The project team communicated this policy with contract manufacturers and component suppliers. The project team reviewed the EICC-GeSI questionnaire responses supplied by the contract manufacturers and component suppliers with senior management. The table below describes the smelters and refiners reported by our contract manufacturers and component suppliers on the EICC-GeSI questionnaire, including the countries of origin of the Conflict Minerals provided.
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Smelters/Refiners Identified For Covered Products |
Smelter/ Refiner Name | Sourcing Status |
A.L.M.T. Corp. | Unknown |
Aida Chemical Industries Co. Ltd. | Unknown |
Almalyk Mining And Metallurgical Complex (Ammc) | Unknown |
Asaka Riken Co Ltd | Unknown |
Atasay Kuyumculuk Sanayi Ve Ticaret A.S. | Unknown |
Aurubis Ag | Unknown |
Bangko Sentral Ng Pilipinas (Central Bank Of The Philippines) | Unknown |
Bauer Walser Ag | Unknown |
Boliden Ab | Unknown |
Caridad | Unknown |
Cendres & Métaux Sa | Unknown |
Changsha South Tantalum Niobium Co., Ltd. | Unknown |
China National Gold Group Corporation | Unknown |
Chongyi Zhangyuan Tungsten Co Ltd | Unknown |
Chugai Mining | Unknown |
CNMC (Guangxi) Pgma Co. Ltd. | Unknown |
Colt Refining | Unknown |
Cooper Santa | Unknown |
CV Serumpun Sebalai | Unknown |
CV United Smelting | Unknown |
Daejin Indus Co. Ltd | Unknown |
Daeryongenc | Unknown |
Dayu Weiliang Tungsten Co., Ltd. | Unknown |
Do Sung Corporation | Unknown |
Doduco | Unknown |
Em Vinto | Unknown |
Estanho De Rondônia S.A. | Unknown |
Fenix Metals | Unknown |
Fse Novosibirsk Refinery | Unknown |
Fujian Jinxin Tungsten Co., Ltd. | Unknown |
Gansu Seemine Material Hi-Tech Co Ltd | Unknown |
Ganzhou Huaxing Tungsten Products Co., Ltd. | Unknown |
Ganzhou Non-Ferrous Metals Smelting Co., Ltd. | Unknown |
Ganzhou Seadragon W & Mo Co., Ltd. | Unknown |
Gejiu Zi-Li | Unknown |
Global Tungsten & Powders Corp. | Unknown |
Guangdong Jinding Gold Limited | Unknown |
Guangdong Xianglu Tungsten Industry Co., Ltd. | Unknown |
HC Starck Gmbh | Unknown |
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Heimerle + Meule Gmbh | Unknown |
Huichang Jinshunda Tin Co. Ltd | Unknown |
Hunan Chenzhou Mining Group Co | Unknown |
Hunan Chun-Chang Nonferrous Smelting & Concentrating Co., Ltd. | Unknown |
Hwasung Cj Co. Ltd | Unknown |
Inner Mongolia Qiankun Gold And Silver Refinery Share Company Limited | Unknown |
Japan Mint | Unknown |
Japan New Metals Co Ltd | Unknown |
Jiangxi Copper Company Limited | Unknown |
Jiangxi Minmetals Gao'an Non-Ferrous Metals Co., Ltd. | Unknown |
Jiangxi Nanshan | Unknown |
JSC Ekaterinburg Non-Ferrous Metal Processing Plant | Unknown |
JSC Uralectromed | Unknown |
Kai Unita Trade Limited Liability Company | Unknown |
Kazzinc Ltd | Unknown |
Kennametal Fallon | Unknown |
Korea Metal Co. Ltd | Unknown |
Kyrgyzaltyn Jsc | Unknown |
L' Azurde Company For Jewelry | Unknown |
Lingbao Jinyuan Tonghui Refinery Co. Ltd. | Unknown |
Linwu Xianggui Smelter Co | Unknown |
Liuzhou China Tin | Unknown |
Luoyang Zijin Yinhui Metal Smelt Co Ltd | Unknown |
Metallo Chimique | Unknown |
Met-Mex Peñoles, S.A. | Unknown |
Minmetals Ganzhou Tin Co. Ltd. | Unknown |
Moscow Special Alloys Processing Plant | Unknown |
Nadir Metal Rafineri San. Ve Tic. A.Ş. | Unknown |
Navoi Mining And Metallurgical Combinat | Unknown |
Novosibirsk Integrated Tin Works | Unknown |
O.M. Manufacturing (Thailand) Co., Ltd. | Unknown |
OJSC “The Gulidov Krasnoyarsk Non-Ferrous Metals Plant” (Ojsc Krastvetmet) | Unknown |
OJSC Kolyma Refinery | Unknown |
Penglai Penggang Gold Industry Co Ltd | Unknown |
Prioksky Plant Of Non-Ferrous Metals | Unknown |
PT Aneka Tambang (Persero) Tbk | Unknown |
PT Artha Cipta Langgeng | Unknown |
PT Babel Inti Perkasa | Unknown |
PT Bangka Putra Karya | Unknown |
PT Bangka Tin Industry | Unknown |
PT Belitung Industri Sejahtera | Unknown |
PT Ds Jaya Abadi | Unknown |
PT Eunindo Usaha Mandiri | Unknown |
PT Karimun Mining | Unknown |
PT Mitra Stania Prima | Unknown |
PT Prima Timah Utama | Unknown |
PT Refined Bangka Tin | Unknown |
PT Sariwiguna Binasentosa | Unknown |
PT Stanindo Inti Perkasa | Unknown |
PT Tinindo Inter Nusa | Unknown |
PX Précinox Sa | Unknown |
Rui Da Hung | Unknown |
Sabin Metal Corp. | Unknown |
Samwon Metals Corp. | Unknown |
Schone Edelmetaal | Unknown |
Shandong Zhaojin Gold & Silver Refinery Co. Ltd | Unknown |
Shanghai Jiangxi Metals Co. Ltd | Unknown |
So Accurate Group, Inc. | Unknown |
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SOE Shyolkovsky Factory Of Secondary Precious Metals | Unknown |
Soft Metais, Ltda. | Unknown |
Tejing (Vietnam) Tungsten Co., Ltd. | Unknown |
The Great Wall Gold And Silver Refinery Of China | Unknown |
The Refinery Of Shandong Gold Mining Co. Ltd | Unknown |
Tongling Nonferrous Metals Group Co.,Ltd | Unknown |
Torecom | Unknown |
Umicore Brasil Ltda | Unknown |
Wolfram Bergbau Und Hütten Ag | Unknown |
Wolfram Company Cjsc | Unknown |
Xiamen Tungsten (H.C.) Co., Ltd. | Unknown |
Xinhai Rendan Shaoguan Tungsten Co., Ltd. | Unknown |
Yamamoto Precious Metal Co., Ltd. | Unknown |
Yokohama Metal Co Ltd | Unknown |
Yunnan Chengfeng Non-Ferrous Metals Co.,Ltd. | Unknown |
Yunnan Copper Industry Co Ltd | Unknown |
Zhongyuan Gold Smelter Of Zhongjin Gold Corporation | Unknown |
Zhuzhou Cemented Carbide Group Co Ltd | Unknown |
Zijin Mining Group Co. Ltd | Unknown |
79 Smelters/Refiners Listed In The Conflict Free Smelter Program | Validated As Conflict Free |
Identified Countries Of Origin: Australia, Belgium, Bolivia, Brazil, Canada, Chile, China, Democratic Republic of Congo, Ethiopia, Germany, Indonesia, Japan, Korea, Malaysia, Mexico, Mozambique, Nigeria, Peru, Philippines, Russia, Rwanda, Singapore, South Africa, Switzerland, Taiwan, Thailand, United Kingdom, United States, Vietnam |
For responses that indicated that Conflict Minerals were sourced from the Covered Countries, the project team determined whether the smelters or refiners that were identified as processing these minerals were validated as conflict-free as part of the CFSP. Of the suppliers that indicated they source Conflict Minerals that were processed in the Covered Countries, only one contract manufacturer could not verify that all the smelters or refiners they used have been validated as conflict-free as part of the CFSP. This contract manufacturer reported that they received “no reported evidence of ore coming from mines supporting conflict.” As a downstream company in the supply chain, we rely on our contract manufacturers and component suppliers to provide us with the information needed to determine the mine or location of origin of Conflict Minerals with the greatest possible specificity. We support the development and implementation of independent third party audits of smelters or refiners such as the CFSP by encouraging our contract manufacturers and component suppliers to purchase materials from audited, conflict-free smelters or refiners.
Since the end of 2013, we have asked each non-responsive component supplier to explain why they did not adequately respond to our request for information and complete the EICC-GeSI questionnaire. These explanations have been reviewed by our Director of Procurement who will determine if we will continue to purchase components from these non-responsive suppliers or if alternative suppliers can be identified and utilized in the future. If we become aware of a contract manufacturer or supplier who does not meet the expectations specified in our Conflict Minerals Policy, our Director of Procurement has the ability to seek alternative sources of supply for our products or components. We have also started the process of including provisions relating to gathering Conflict Minerals information in our supply contracts to encourage greater cooperation by the companies in our supply chain.
Findings and Conclusions
We did not receive responses from certain of our contract manufacturers and component suppliers and one contract manufacturer could not confirm that all of their sources in the Covered Countries are certified to be conflict free. We are not aware of any product or component that contains Conflict Minerals from the Covered Countries that benefited armed groups. The prior table lists the smelter or refiner names and country of origin information provided by our contract manufacturers and component suppliers. We believe that requesting our contract manufacturers and component suppliers to complete the EICC-GeSI Conflict Minerals questionnaire and encouraging these upstream suppliers to source materials from conflict-free sources such as those certified by the CFSP, and ensuring that our contract manufacturers and suppliers understand our Conflicts Minerals Policy, represents a reasonable effort to determine the mines or location of origin of the Conflict Minerals in our supply chain. The amount of information available globally on the traceability and sourcing of the original ores is limited at this time.
Steps to Improve Due Diligence
We have communicated our expectations, as reflected in our Conflict Minerals Policy, to our contract manufacturers and other suppliers. We will continue to encourage our contract manufacturers and suppliers to provide us with the information needed to determine all of the facilities used to process the Conflict Minerals used in our Covered Products, as well as the mine or location of origin of these Conflict Minerals. We believe that the quantity and quality of information related to sourcing and traceability of materials in the supply chain will continue to improve in the years to come, and we are taking the steps above to increase the response rate to the EICC-GeSI questionnaire in future years. We encourage our contract manufacturers and suppliers to seek Conflict Minerals from smelters or refiners that participate in CFSP and similar certification programs. We will continue to monitor our contract manufacturers and suppliers and perform risk assessments on our overall sourcing practices, including the procurement of Conflict Minerals. Dolby is actively engaged with Industry Organizations such as the IPC (www.ipc.org) to help develop and disseminate methods to improve compliance processes with respect to Conflict Minerals.