EXHIBIT 14.1
MOLECULAR INSIGHT PHARMACEUTICALS, INC.
CODE OF CONDUCT AND BUSINESS ETHICS
ADOPTED ON NOVEMBER 16, 2005
This Code of Conduct and Business Ethics ("the Code") has been approved by
the Board of Directors of Molecular Insight Pharmaceuticals, Inc. to provide
guidance for all of its officers, employees, consultants and directors. All
officers, employees, consultants and directors (each an "associate") should read
it with care and ask for guidance with respect to any questions it raises.
INTRODUCTION
The purpose of the Code is to assist our employees, officers, directors,
consultants and agents (each an "associate") in maintaining the high ethical
standards of the Company in all of its business dealings. It will help guide you
in making decisions that conform to the ethical and legal standards expected of
you. It will also help ensure the Company's compliance with the laws that
regulate its business. The Code cannot cover every situation and fact and it is
the responsibility of each associate to ask questions, seek guidance and express
concerns regarding compliance with the Code. Conduct contrary to the Code will
result in an investigation and possible disciplinary action up to and including
discharge.
This Code is not an employment contract and the Company has not created
any contractual or other rights of continued employment by issuing this Code.
The policies in this Code are in addition to other policies that the Company may
adopt from time to time. The Code may be revised from time to time as the
Company deems appropriate. All references in the Code to "associate" or
"associates" includes all officers, employees, board members, consultants and
independent contractors of the Company, unless the context indicates otherwise.
The term "Company" includes Molecular Insight Pharmaceuticals, Inc. and its
subsidiaries, affiliated entities and divisions.
1. QUESTIONS ABOUT THE CODE
After you have read the Code, you may have questions about its contents,
the applicability of these standards to situations you may face, or what to do
when a conflict of interest arises. Use the Company's "Four-Step Compliance
Communication Process" (which is explained in the next section of this Code) to
resolve these kinds of questions.
The Company's Chief Operating Officer has the right and duty to
investigate any alleged noncompliance with the Code.
2. ACKNOWLEDGMENT FORM
One part of the Code is a Compliance and Disclosure Form, which requires
your signature acknowledging that you have read and understand the Code. It also
provides space for you to disclose conflicts of interest, including outside
business affiliations, as discussed in the section "Conflicts of Interest." You
should complete the form promptly and return it to the Company's Chief Operating
Officer. Also, you must submit a new form any time a change occurs with respect
to a potential conflict of interest or outside business affiliation.
3. THE FOUR STEP COMPLIANCE COMMUNICATION PROCESS
The Company's "Four-Step Compliance Communication Process" is your guide
to handling compliance issues. If you have a compliance concern or simply want
guidance regarding a compliance issue, you should use the Four-Step Process. You
should also use the Four-Step Process to report suspected violations of federal
or state laws, rules, or regulations, as well as to report suspected violations
of this Code of Conduct.
Most questions or issues can be handled in consultation with your
supervisor. Thus, the Four-Step Process has been designed to give those closest
to the associate the opportunity to address matters as they arise. The process
then allows for matters to be advanced, as appropriate.
- First, talk to your supervisor. He or she will be familiar with the
laws, regulations and policies that relate to your work and will be
able to handle most matters.
- Second, if you are not comfortable talking with your supervisor (for
example, if you are questioning your supervisor's conduct), talk to
your supervisor's supervisor.
- Third, if you feel the matter cannot be handled by the first and
second steps, contact the Company's Chief Operating Officer.
- Fourth, if none of the above steps resolves your questions or
concerns, or if you prefer, call the toll-free Compliance Hotline at
(800) 270-0082. All calls are confidential and you may call
anonymously if you choose.
4. WHEN SHOULD I CALL THE HOTLINE?
You should call the Compliance Hotline anytime you are aware of an actual
or potential violation of the Code and you feel that you cannot go to your
supervisor or to the other personnel designated in the Four-Step Compliance
Communication Process.
5. WHEN SHOULD I NOT CALL THE HOTLINE?
If you have questions about employment policies or procedures, talk to
your supervisor. For questions about medical, dental, or disability plans or
claims call your provider. If you have
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any other questions relating to policies, procedures or benefits, you should
contact the Company's human resources department.
ASSOCIATE CONDUCT
We believe that our associates work best in an atmosphere of fairness,
cooperation and equal opportunity where each associate is treated with respect.
To promote this atmosphere, the Company and all of its associates will comply
fully with these guidelines and all employment laws. While it is difficult to
develop clear, practical rules and policies to cover every conceivable
situation, included here are minimum standards for Company associates.
The Company expects all associates to maintain certain common sense
standards of good conduct in order to ensure the safety and welfare of
associates and to maintain a cooperative, efficient, positive, harmonious and
productive work environment. Theses standards apply whether working on Company
premises, at offsite locations where Company business is being conducted, at
Company sponsored business and social events, or at any other place where you
are a representative of the Company. Associates who engage in misconduct or
whose performance is not satisfactory may be subject to disciplinary action,
including termination.
1. EQUAL EMPLOYMENT OPPORTUNITY
The Company is an equal opportunity employer. Our policy is to provide
each job applicant and associate with equal opportunities for employment,
training, promotion, benefits and all other personnel actions without regard to
any protected category or class (i.e., without regard to race, color, creed,
religion, gender, marital status, sexual orientation, national origin, age,
veteran status, disability or any other protected category or class). The
Company strives to employ individuals in positions that best suit their
abilities, interests and skills, as well as the Company's needs.
2. COMPLIANCE WITH LAWS, CRIMINAL CONDUCT
Obeying the law, both in letter and in spirit, is both expected and
required of all associates. All associates must comply with all laws, rules and
regulations applicable to the Company's business. Although you may not know the
details of all laws, it is important to know enough to determine when to seek
advice from supervisors or other personnel in the Company. Much of this Code
addresses those situations.
Moreover, the Company does not permit or condone criminal activity with
respect to any aspect of its business. Any associate who becomes aware of
suspected criminal activity is required to report the activity using the
"Four-Step Compliance Communication Process" and any associate found to have
engaged in criminal conduct will be subject to disciplinary action up to and
including termination. The Company will refer all instances of suspected
criminal conduct to the appropriate governmental authorities for possible
criminal prosecution.
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3. WORKPLACE SAFETY & SECURITY
It is the Company's policy to establish and maintain a safe, secure and
healthy workplace free of recognized hazards, actual or threatened violence
against co-workers, visitors, or any other persons who are either on our
premises or have contact with our associates in the course of duties. It is also
the Company's policy that every associate understand the importance of workplace
safety and security. Every associate is responsible for helping to ensure the
safety of the Company workplace through personal action and through reporting
any unsafe condition.
4. UNLAWFUL HARASSMENT
Conduct at work and at Company-sponsored and related functions (including
activities that are an extension of such functions) must be professional at all
times. There must be:
- No derogatory references made to or about any person, especially
references relating to gender, religion, race or any other protected
class.
- No unwanted or otherwise inappropriate physical conduct (such as
suggestive gestures, uninvited touching or sexual advances).
- No sexually explicit, vulgar, crude or offensive language, jokes,
photographs or other materials.
- No other conduct that creates an un-professional, intimidating
and/or hostile environment or the impression of such an environment.
In addition to the minimum standards referred to above, at
Company-sponsored events there must also be:
- No function (such as a sporting event, golf outing or fishing trip)
that excludes a person's participation based on any protected
category or class.
- No activity that tends to demean any person based on any protected
category or class. (Example: Hiring strippers, exotic dancers or
singing telegrams to appear at meetings.)
- No practice or custom that tends to lead to uncomfortable situations
or improper behavior. (Example: Engaging a dance band at a function
where spouses are not in attendance.)
- No pressure on anyone to engage in the consumption of alcoholic
beverages or participation in gambling activities.
There must be no retaliation of any kind against anyone alleging or
complaining of harassment, conflicts of interest, hostility or unlawful
discrimination, and assurances of "no retaliation" should be given to those who
have so complained. All of the above-stated standards
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for behavior are in addition to any other established Company policies dealing
with the avoidance of sexual harassment, other unlawful harassment and
discrimination. Violation of these Company standards and policies, or the filing
of a false claim of violation of these standards and policies, may result in
disciplinary action up to and including termination. These standards are not
intended to regulate personal morality, but rather to ensure that the work
environment is free of harassment, conflicts of interest, hostility and unlawful
discrimination.
5. SUBSTANCE ABUSE
Any associate found using, selling or in possession of illegal drugs on
Company premises will be subject to disciplinary action (which could include
termination of employment). Similarly, the sale or unauthorized use of alcohol
or controlled substances on Company premises is prohibited. Being impaired by
alcohol or drugs while performing Company business is unacceptable and likely to
lead to disciplinary action (which could include termination).
6. ENVIRONMENTAL LAWS
The Company is committed to doing business in an environmentally
responsible manner. This includes complying with laws involving environmental
quality and related health and safety issues. Each associate is expected to
conduct the Company's business in an environmentally responsible manner and not
to engage in any activity that violates environmental laws or regulations.
Associates should report unsafe working conditions, use resources efficiently,
recycle as appropriate, handle any hazardous materials properly, and handle and
dispose of all materials and waste in accordance with applicable laws and
Company policies. If you have any questions about environmental laws, rules or
regulations, contact the Company's Chief Operating Officer.
7. CONFLICTS OF INTEREST
Associates must avoid any situation involving a conflict between their
personal interests (including those of close family members) and the interests
of the Company. Associates should not contract with close family members or
incur any financial or personal obligation that might affect, or appear to
affect, their judgment in dealing with other associates or with outside firms or
individuals. Each associate should review his or her own activities and those of
any close family member so that the proper disclosures can be made.
Please note that a "close family member" includes a spouse, domestic
partner, parent, sibling, child, in-law and "step"-relative equivalents.
Potential Conflicts: Business Interests
The following are examples of conflicts between personal interests and the
interests of the Company:
- Deriving personal gain from any purchase or business decision in
which the associate participated on behalf of the Company.
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- Speculating or dealing in equipment, supplies, materials or property
purchased by the Company; or speculating or dealing in products or
services sold by the Company.
- Borrowing money from suppliers, customers, residents, individuals or
companies with whom the Company does business.
- Acquiring any real-property interest in which it is known that the
Company also has or may acquire an interest.
- Having a business or financial interest in any organization which:
- Sells, rents or leases any goods, services or real property to
the Company,
- Buys, rents, or leases any goods, services or real property
from the Company, or
- Is in competition with the Company.
Having "a business or financial interest" in an organization means the
individual is involved as:
- an owner, consultant, employee, or
- a stockholder having a one-percent (1%) or greater interest in a
publicly traded company, or
- the holder of any interest in a privately held company, partnership,
brokerage, or joint venture (including as a creditor, guarantor or
director), or
- serving as an employee of or paid consultant to another organization
in areas similar to those in which the associate provides services
to the Company.
Each full-time employee ordinarily is expected to serve the Company's
interests on a full-time basis. Permission to provide similar services to others
should be obtained from the employee's supervisor and must be approved by the
Company's Chief Operating Officer. Positions with educational, charitable and
other nonprofit entities need not be disclosed unless the Company has been asked
in the last two years, or will be asked in the future, to contribute to such
entity.
Employment of Relatives
Associates are prohibited from employing or placing close family members
inside the Company in positions that create a conflict of interests. Prohibited
relationships are those in which:
- The associate has direct supervisory authority over the family
member.
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- The associate has bookkeeping or payroll responsibility over the
family member.
- The associate may significantly influence the pay, benefits, career
progression or performance of the family member.
Dating Relationships
No associate may have a dating relationship with another associate in a
reporting or supervisory chain, or whose terms or conditions of employment may
be influenced by the relationship. If a situation occurs that could be perceived
as a violation of this standard, the associates must disclose the relationship
to management. The Company will then make reasonable efforts to reassign or
transfer one of the associates involved to avoid any actual or perceived
conflict of interest. If no suitable accommodation can be arranged, it may be
necessary for one associate to leave the Company. The associates will be
permitted to determine which of them will resign. If one of the two associates
does not resign, management will decide which of the associates will leave.
Determination and Disclosure of Conflicts
Determining whether you have a conflict of interest and, if so, what to do
about it may be difficult. If you have questions, you should discuss them with
your supervisor so that together you can deal properly with the situation.
The Compliance and Disclosure Form included in this Code is provided for
the purpose of documenting potential or actual conflicts of interest. Any
associate who does not disclose a conflict of interest - including a family
member's employment situation - on the Compliance and Disclosure Form is subject
to disciplinary action up to and including termination.
Supervisors must refer each potential conflict of interest situation to
the Chief Operating Officer, who will determine whether it poses a potential for
harm to the Company's business interests or creates an appearance of improper
influence:
- If either problem exists, the Chief Operating Officer and associate
must agree on a course of action to remove the conflict situation as
soon as possible.
- If no problem exists, the Chief Operating Officer will approve the
situation in writing, with a copy placed in the associate's
personnel file.
In either case, the Chief Operating Officer will document the particular
facts disclosed to him or her and the basis for his or her decision in each
case. If the correct course of action is not clear, the Chief Operating Officer
will contact the Company's legal advisors to obtain resolution of the matter.
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BUSINESS RELATIONSHIPS
1. GIFTS, HOSPITALITY AND OTHER BENEFITS
Associates may not accept gifts from anyone with whom the Company does or
proposes to do business, except for gifts of nominal value as described below.
Similarly, associates may not offer or give anything of value to anyone with
whom the Company does or proposes to do business. It is important that
associates avoid any situation in which it might appear that improper influence
affected a Company policy or decision.
Gifts of Nominal Value
Courtesy gifts of nominal value - including reasonable paid meals
ancillary to business meetings for the Company and unsolicited promotional items
such as pens and calendars that are not intended to invite any form of
reciprocation - are permissible as long as public scrutiny of the gift would not
cause the Company embarrassment or the gift could not be construed as a bribe.
Unacceptable gifts include cash, goods or services for personal use, reduced
prices, work performed gratuitously and loans of money, material or equipment on
a preferential basis. If any associate feels an exception to this policy is
justified, he or she must seek advance approval from the Company's Chief
Operating Officer.
Travel and Entertainment Expenses
The Company pays travel and entertainment expenses in accordance with the
its separate travel policy. Acceptance of an occasional business meal or
entertainment of nominal value from someone with whom the Company does business
is permissible if it is required as a courtesy in the normal course of business
relations, and if the associate is able to reciprocate. Stipends and travel
expenses paid to an associate by an outside source for work done on the
Company's behalf must be reported to the associate's supervisor and either
declined or remitted in full back to the outside source.
2. BRIBES AND KICKBACKS
The Company neither practices nor condones bribery and associates must
never, directly or indirectly, give to, or receive from, any customer or
supplier any bribe, kickback, item of material value or other unusual payment.
Federal and state laws specifically make it a crime for anyone to offer or
accept a bribe, kickback or other thing of value for referring business.
All business dealings on behalf of the Company must be the result of usual
and proper business considerations. Business dealings must never be the result
of undue influence exerted by, or special favors bestowed by, any customer or
supplier. It is forbidden to solicit from customer or supplier any monies,
contributions or program sponsorships, or other property or favors. No services
or supplies may be accepted for free or purchased at less than fair market value
as an inducement to obtain contracts for any other services. If any gift or
payment cannot
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withstand public scrutiny under these rules, it should not be made, accepted or
solicited on the Company's behalf.
INFORMATION AND COMPANY ASSETS
1. INTELLECTUAL PROPERTY
All associates are responsible for the proper handling of all of the
Company's intellectual property that may come under their control. This can
include logos, trademarks, patents, inventions, designs, service marks and
copyrights. It is the Company's policy to enforce its rights in its intellectual
property, such as patentable inventions, where it deems it appropriate and to
use prescribed notices of its intellectual such rights, such as trademarks and
service marks, on its products and in related promotional or marketing
materials. Associates should report to their supervisor any infringement of the
Company's intellectual property rights which comes to the associate's attention.
Associates are expected to contribute to the research and development of
new technologies, products and services. Associates are further expected to
document all discoveries and ideas and to promptly report such discoveries and
ideas to designated persons in the Company. To the full extent permitted by law,
associates are required to assign to the Company all of their interest in any
invention, discovery, idea or patent which is developed in connection with their
employment by the Company. These inventions, discoveries, ideas and the like
belong to, and are the property of, the Company.
2. CONFIDENTIAL INFORMATION
During the course of employment with the Company, an associate may learn
certain non-public information. Information concerning the Company's research
and development activities, trade secrets, and management and business
operations that is generally not known to the public or our competitors should
be kept confidential and associates should endeavor to maintain the secrecy of
such information. Examples of confidential information are:
- The Company's strategic business plans.
- Future or pending sales, acquisitions and mergers.
- Results of any clinical studies or information related to research
and development of Company products.
- Financial results prior to public disclosure.
- Pricing and marketing information.
- Customer and supplier lists.
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- Associates' personal information.
- Data developed or purchased by the Company or entrusted to us by
customers or suppliers if identified as confidential.
Guidelines for Protecting Confidential Information
It is important that we diligently protect the confidentiality of our
information. The following guidelines have been developed for this purpose:
- Confidential information should be shared only with those inside the
Company whose jobs require them to have access to the information or
when the law requires or protects the release of such information.
- Associates should not disclose sensitive or non-public information
to people outside the Company or discuss it in public places.
- When information is disclosed to individuals having a business
relationship with the Company that requires such disclosure, it
should be done with the understanding that the information will be
kept in confidence, and only the minimum amount of information
necessary to accomplish the function should be disclosed.
- Documents containing sensitive information - including information
stored on computer systems - should be handled carefully during
working hours and must be properly secured at the end of the day.
- Discussions between the Company and its lawyers are usually
privileged and should be kept confidential. Any disclosure of those
discussions to a third party may result in a waiver of the
attorney-client privilege and possible harm to the Company's
interests.
Original copies of scientific records should never leave the Company's
premises unless authorized by the Chief Scientific Officer of the Company. Under
no circumstances should associates take originals or photocopies of scientific
records from the facility without the approval of the Company's Chief Scientific
Officer.
2. GOVERNMENTAL REQUESTS FOR INFORMATION
It is the Company's policy to cooperate with any reasonable request of
federal, state and local authorities seeking information concerning Company
operations. At the same time, the Company is entitled to the safeguards provided
by law, including representation of legal counsel from the first contact. The
Company may be asked for information that is protected by privacy laws and may
be obliged to ensure privacy in responding to such requests.
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Responding to Governmental Inquiries
If a representative of a governmental agency requests an interview with
Company personnel or seeks data, copies of documents or access to files, he or
she should be told that the Company intends to cooperate but that the matter
must first be discussed with the Company's lawyers. All such requests, written
or oral, must be reported to the Company's Chief Operating Officer immediately
so that he or she may consult with the Company's legal advisors and respond
appropriately.
Responding to Other Requests for Information
Requests for information from other parties should be reviewed with your
supervisor prior to response.
3. INFORMATION SECURITY
Information contained in the Company's computer systems, as well as
information contained in the Company's manual information systems, is
confidential and proprietary. Information security refers to safeguarding this
confidential information from damage, loss, unauthorized access, or unauthorized
modification.
Computer System Security
Associates utilizing the Company's computer systems should comply with the
following:
- Each associate must keep his or her computer access password(s)
confidential.
- Only Company-provided software may be installed on Company
computers.
- Software must not be removed from the Company's computers (e.g.,
removal of anti-virus software creates a security vulnerability).
- Computers should be "locked" when unattended to protect from use by
unauthorized persons. The method of "locking" will depend on the
particular system and location (e.g., a password protected
screensaver). Consult your supervisor for the details that apply to
your location.
- Log off and power off your workstation when you leave for the day.
Security of Records
Documents containing sensitive information should be kept secure and
should not be left in the open where they may be viewed by third parties. Hard
copies of documents containing sensitive information must be disposed of
properly when they are no longer needed. Normally this means they must be
shredded or deposited in a designated location for removal and
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destruction. Documents should be retrieved from printers, fax machines and copy
machines in a timely manner.
Violations and Penalties
Associates who violate Information Security policies are subject to
disciplinary action by the Company, up to and including termination. The Company
also retains the right to seek civil relief and to refer incidents for criminal
prosecution.
4. RULES FOR USING COMPANY ASSETS AND RECORDS
In general, no Company funds, assets or purchasing cards may be used for
any improper or unlawful purpose, associates may not take Company property or
other assets for personal use, and associates may not use Company assets for
non-Company purposes or use the personal services of other associates working on
Company time. Supervisors may approve occasional exceptions to this rule if the
exception is reasonable and is in the Company's best interest.
The Company prohibits false or misleading information in any Company
records. No unrecorded fund or asset of the Company may be established for any
purpose. No payment on behalf of the Company may be approved or made with the
intention, understanding or agreement that any part of such payment will be used
for any purpose other than that described by the documents supporting the
payment. Any associate having information or knowledge of any unrecorded fund or
asset - or any act involving fraud or the falsification of company records -
must immediately report such matter to his or her supervisor, even if the
knowledge was acquired or the act occurred before receipt of this policy
statement. Violation of this Code section will result in disciplinary action up
to and including termination.
5. COPYRIGHT LAWS
Copying and distributing materials that are licensed or copyrighted by the
Company is prohibited unless specifically authorized by the Company's Chief
Operating Officer.
Printed and Online Publications
The Company purchases and/or subscribes to a variety of printed and online
publications. These publications are protected by copyright laws, which, with
some limited exceptions, prohibit the reproduction or copying of the material
without the specific authorization of the publisher. Associates who make,
acquire or use unauthorized copies of printed or online publications will be
subject to disciplinary action up to and including termination. In addition,
federal copyright law makes the illegal copying of printed or online
publications subject to substantial civil damages.
Computer Software and Documentation
The Company purchases and licenses a variety of computer software. In most
instances, the Company does not own the copyright to the software or its related
documentation and, unless
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specifically authorized by the software developer, does not have the right to
reproduce it. Associates who make, acquire or use unauthorized copies of
computer software will be subject to disciplinary action up to and including
termination. In addition, federal copyright law makes the illegal reproduction
of software subject to substantial civil damages and even criminal penalties.
FAIR COMPETITION
1. MARKETING AND RECRUITING
The Company's competitive appeal must be based on the quality and value of
our services and the employment opportunities and benefits we offer, and must
never be on unethical or illegal practices. The Company's - and each associate's
- - reputation for integrity, quality services and fair employment practices is a
priceless asset and the result of the continuous effort of each associate.
The following guidelines govern our marketing practices:
- The Company's advertising must always be truthful.
- No associate may label or market Company products or services in any
way that may intentionally cause confusion between the Company's
products or services and those of any of its competitors.
- All associates should be alert to -- and never enter into -- any
business arrangement or contract in which the Company or associate
pays or receives any compensation, or gives or receives any gift, in
return for referral of business that may be subject to payment by a
federal or state reimbursement program.
- Associates must never disparage the products or services of any of
the Company's competitors. If a comparison of the Company's services
is conducted against those of a competitor, such comparison must be
fair and accurate.
- Associates must use the Company's trademarks, trade names and
service marks in accordance with the policies governing their use.
This includes the use of trademark or service mark designations
where appropriate.
2. POLITICAL CONTRIBUTIONS OR INFLUENCE
Federal law, and the laws of most states, prohibit a corporation from
giving, directly or indirectly, anything of value to a governmental official
with the intent to influence any official act. Since the absence of such intent
might be difficult to prove, neither money nor anything of value should be given
to federal or state governmental officials. This prohibition is also applicable
to all federal and most state elections. While the Company supports each
associate's
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personal decision to participate in the election process, it is the Company's
policy not to contribute any corporate funds for such matters.
2. INSIDER TRADING IN SECURITIES
No associate - including any employee, officer, director, consultant or
agent of the Company or any member of such person's household or family - may:
- Buy or sell Company securities while in possession of material
non-public (or inside) information concerning the Company.
- Communicate such material inside information to another person who
may trade or advise others to trade on the basis of such
information.
- Trade in the securities of other companies while in possession of
material inside information about the other company obtained in the
course of employment with our Company (e.g., information concerning
a possible acquisition of another company).
Such prohibited acts are referred to as "insider trading." Additionally,
no associate may at any time trade in market options on Company securities or
engage in short sales of Company securities, which is discussed in more detail
below. References to "Company securities" in this Insider Trading Policy means
all publicly traded equity and debt securities of the Company, including common
stock, preferred stock, notes and debentures.
The restriction on insider trading does not preclude the following
transactions (referred to as "exempt transactions"):
- Acquisition of common stock under the Company's stock incentive plan
or other employee benefit plans (but not the sale of such common
stock).
- Acquisition of common stock pursuant to a previously established
election to invest contributions in a company-sponsored employee
benefit plan (but not the sale of such common stock).
- Acquisition or disposition of a security pursuant to a previously
established trading plan that complies with the requirements of Rule
10b-5-1 of the federal securities laws.
- Acquisition or disposition of a security as a result of a bona fide
gift or a transfer by will or the laws of descent.
Pre-Clearance of Transactions
All associates of the Company, including, directors, officers, employees
and consultants, must consult the Company's Chief Operating Officer before
engaging in any acquisition or
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disposition of Company securities, even during window periods. For transactions
pursuant to investment elections in a Company-sponsored employee benefit plan or
pursuant to a Rule 10b-5-1 trading plan, the pre-clearance policy applies at the
time such election or trading plan is adopted or amended.
The pre-clearance requirement is intended to serve the following
functions:
- Prevent inadvertent insider trading violations.
- Assist directors and officers in complying with their reporting
obligations under the federal securities laws.
- Verify compliance with any other obligations under applicable laws.
Guidelines
In addition to the foregoing provisions on trading, it is the Company's
policy that directors, officers and other associates should only buy or sell
Company securities during the "window period". The window period typically
begins on the third business day following the earlier of the issuance of (a) an
earnings release for a completed quarterly or annual period, or (b) a periodic
report on Form 10-Q or Form 10-K. The window period ends on the last day of the
second calendar month following the end of the immediately preceding fiscal
quarter to which such earning information pertained, absent some other materials
development pertaining to the Company. No one may trade during window periods or
at any other time, however, if he or she possesses material inside information.
As an example, if the Company makes an announcement of earnings with
respect to its first quarter earnings before the stock market opens on Monday,
the first trading day in the window period would be Wednesday. If the Company
makes an announcement of earnings while the market is open on a Monday or after
the market closes on a Monday, the first trading day in the window period would
be Thursday. Since the earnings announcement was made with respect to the first
fiscal quarter, which ended March 31st, the window period would end on the last
day of May.
Additionally, certain directors, officers and other associates designated
in writing from time to time by the Company (collectively, the "blackout group")
are subject to additional restrictions during "blackout periods," which are any
time other than window periods. Members in the blackout group may buy or sell
securities only during the window period and cannot buy or sell securities
during blackout periods. The blackout period restrictions do not apply to exempt
transactions.
Classification of Information as Material
Non-public (or inside) information is considered "material" if a
reasonable person would attach importance to it in determining whether to buy,
sell or hold the company's securities. Information about the following could be
material:
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- Quarterly or annual reports
- Joint ventures, mergers, acquisitions or divestitures
- Stock splits or changes in dividend policy
- Significant changes in senior management
- Sale of additional securities
- Major litigation
- Establishment of a program to buy the Company's own shares
- Tender offer for another company's securities
- Impending bankruptcy or financial liquidity problems
Information is considered public (i.e., not inside information) if it has
been publicly disseminated such that investors have had the opportunity to
evaluate it, or if it is information that has been filed with governmental
agencies as a matter of public record. To ensure information has been adequately
disseminated to the public, you should refrain from trading in the Company's
securities until the 3rd business day after a news release or other public
disclosure has been issued.
Violations
All associates who have questions must consult the Company's Chief
Operating Officer before engaging in a transaction. Officers and supervisors
must take reasonable measures to ensure that associates under their supervision
who are reasonably likely to have access to material inside information are
aware of insider trading laws. Failure to do so can subject such individuals to
liability as a supervisory person, as discussed earlier. Any suspected violation
of insider trading laws must be promptly reported in writing to the Company's
Chief Operating Officer. Anyone who violates insider trading laws is subject to
disciplinary action up to and including termination.
Penalties
Under federal securities laws an individual who engages in insider trading
is subject to:
- Civil fines by the Securities and Exchange Commission (SEC) of
up to three times the profit gained or loss avoided
- Injunctive action by the SEC
- Private actions for rescission or damages
- For a criminal violation, fines up to $1.2 million and a
prison sentence up to 20 years. For a criminal violation, the
Company is subject to fines up to $2.5 million.
The Company, as well as the applicable director or associate, is subject
to liability if the Company or such person knew and recklessly disregarded the
fact that a person directly or indirectly under the Company's or such person's
control was likely to engage in insider trading
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and failed to take appropriate steps to prevent such act before it occurred. A
controlling person's liability may be as much as the greater of $1 million or
three times the profit gained or loss avoided as a result of the inside trade.
3. PROHIBITION ON SHORT SELLING OF COMPANY SECURITIES
Generally, no associate may engage in any transaction where one may
benefit from a decline in the Company's stock price (i.e., a short sale). While
employees who are not officers or directors of the Company are not prohibited by
law from engaging in such short sales of Company securities, the Company has
adopted a policy that no associate may do so. Specifically, no associate,
including directors and officers, may, directly or indirectly, sell any Company
security, including derivatives, if the person selling the security or his
principal (i) does not own the security sold or (ii) if the security is owned,
does not either deliver it against such sale within 20 days or does not deposit
it in the mail or other usual channels of transportation for such delivery
within 5 days.
4. ANTITRUST LAWS
Agreements that unreasonably lessen business competition are the core
concern of the antitrust laws and may result in severe penalties, both civil and
criminal, to the Company and the individuals who act on the Company's behalf. In
general, federal and state antitrust laws prohibit competitors from entering
into any agreement or understanding that restricts competition. It is important
to note how easily such an agreement can be established. For example, the courts
have found illegal agreements to exist where there is no written contract or
even an oral contract. An agreement may be inferred where the facts indicate
that the parties understood what they would do without any overt communication
between them.
Associates must never have discussions with the representatives of any
competitor that might be considered an anti-competitive activity. Examples of
these prohibited activities are:
- Price fixing - Agreement among competitors to raise, lower or
stabilize prices.
- Division of markets - Agreement among competitors to allocate trade
territories.
- Group boycott and refusal to deal - Agreement among competitors to
refuse to deal with certain customers or other competitors.
- Tie-in - The sale of one product or service on the condition that
the buyer purchase a separate product or service, if the seller has
a substantial share of the market for either product or service.
- Favoritism - Treating similarly situated customers differently or
otherwise showing favoritism in sales or purchasing practices.
Most violations of antitrust laws arise from contacts with competitors. If
prices are discussed with a competitor, that action alone may be considered an
unlawful understanding or
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agreement. No such discussion should ever occur. Penalties for engaging in
anti-competitive activities may be severe for the Company and the participating
individuals. These penalties may include:
- Imprisonment.
- Substantial fines.
- Monetary damages, including punitive damages in some instances.
- Attorney fees and court costs to the injured party or the
government.
- Injunctions or consent decrees prohibiting certain activities in the
future.
LEGAL REVIEW AND OVERSIGHT
1. CONTRACTS
All contracts to which the Company is or will be a party must be approved
prior to execution of the contract by the Company's Chief Operating Officer.
Additionally, the following guidelines apply to all contracts:
- No written agreement may be subject to any oral side agreements.
- All notices received with respect to any contract, real estate
matter or dispute must be immediately forwarded to the Chief
Operating Officer by fax, with the original sent by certified or
overnight mail.
- All contracts are subject to review for potential conflicts of
interest as discussed in the section titled "Conflicts of Interest."
2. LEGAL ACTION
The Company's executive officers, including the Chief Executive Officer,
President and Chief Operating Officer, are the only individuals who may seek out
or retain outside legal counsel for any purpose other than routine collection
matters. The Company's Chief Operating Officer must be notified immediately when
any notice of a legal action against the Company is received or when there is an
unusual occurrence that could result in legal action against the Company.
Additionally, if any attorney representing another person, company or the
government contacts an associate with respect to the Company, or an associate
receives a subpoena, legal complaint, service of process or other similar legal
document, the associate must immediately contact the Company's Chief Operating
Officer.
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3. LEGAL COMPLIANCE
The Company will comply with all laws that apply to its business. When any
question exists as to the Company's legal rights and obligations, the Chief
Operating Officer must be consulted so that he may obtain advice to assure
compliance with all applicable laws and regulations.
MEDIA RELATIONS
Press releases and contact with the news media, securities analysts or
investment bankers must be made only through or at the direction of the
Company's Chief Executive Officer, Chief Operating Officer or Vice President for
Corporate Communications. If a reporter or other member of the news media
contacts any associated regarding the Company, the associate should refer such
person to the Company's Chief Executive Officer, Chief Operating Officer or Vice
President for Corporate Communications. The associate should not answer any
questions, comment on, confirm or deny anything related to the Company's
business.
COMPLIANCE WITH THE CODE OF CONDUCT
1. COMPLIANCE
As a condition of continued employment with the Company, associates are
expected to comply with the Company's Code of Conduct and Business Ethics as
well as any related policies and procedures. Supervisors are responsible for
understanding and enforcing this Code as well as Company policies and
procedures. Violation of any part of the Code of Conduct and Business Ethics is
grounds for disciplinary action up to and including termination.
2. REPORTING VIOLATIONS
It is the duty of any associate who discovers a violation of the Code of
Conduct and Business Ethics to report the violation. The Company has a specific
communication and reporting process for compliance issues called the "Four-Step
Compliance Communication Process" which is explained in this Code. A failure to
report a violation is itself a violation of this Code and could be grounds for
disciplinary action up to and including termination.
3. NO RETALIATION
Associates will not be subject to discipline or otherwise retaliated
against with respect to employment for reporting in good faith a possible
violation of this Code. Any associate who violates this prohibition on
retaliation against another associate will be subject to disciplinary action up
to and including termination.
Adopted on November 16, 2005
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COMPLIANCE AND DISCLOSURE FORM
1. ACKNOWLEDGEMENT
I have read the entire Code of Conduct and Business Ethics. I have had the
opportunity to ask questions regarding the contents of the Code of Conduct and
Business Ethics, and I understand how the contents relate to my position with
the company. I agree to abide by the principles of the Code of Conduct and
Business Ethics, and to keep a copy of the Code for future reference. I am aware
of no possible or actual conflicts of interest between the Company and me, as
defined in the code section titled "Conflicts of Interest," except as shown on
this form.
2. CONFLICTS OF INTEREST
Are you aware of any interest(s) or position(s) involving or held by you or a
close family member that would likely constitute a conflict of interest with the
Company?
- ---- -----
Yes No
If "yes," please describe the situation(s) below:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: For examples of situations that could give rise to conflicts of interest,
and for a definition of "close family member," see the Code section titled
"Conflicts of Interest."
3. CERTIFICATION
I hereby certify that the information supplied on this form is true, correct and
complete to the best of my knowledge and belief.
Name:
-----------------------------------
Signature:
-----------------------------------
Date Signed:
-----------------------------------
INSTRUCTIONS: Complete this form promptly and give it to your supervisor. It
will be included in your personnel records. You must submit a new form each time
a situation arises that would be a potential conflict of interest.
The Company's Chief Operating Officer will review potential conflict of interest
situations. The resolution of the situation will be documented and included in
your personnel file.
Date Approved (by Chief Operating Officer):
---------------------------
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MOLECULAR INSIGHT PHARMACEUTICALS, INC.
CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS
The Chief Executive Officer, Chief Financial Officer, Chief Accounting
Officer, Controller and persons performing similar functions as officers or
employees of Molecular Insight Pharmaceuticals, Inc. (the "Company") will:
- Act honestly and ethically, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships.
- Promote accurate, full, fair, timely and understandable disclosure
in reports and documents that the Company files with, or submits to,
the Securities and Exchange Commission and in other public
communications made by the Company.
- Comply with laws, rules and regulations of federal, state,
provincial and local governments, and other appropriate private and
public regulatory agencies applicable to the company.
- Act in good faith, responsibly, with due care, competence and
diligence, without misrepresenting material facts or omitting to
state material facts or allowing one's independent judgment to be
subordinated.
- Respect the confidentiality of information acquired in the course of
one's work except when authorized or otherwise legally obligated to
disclose. Confidential information acquired in the course of one's
work will not be used for personal advantage.
- Achieve responsible use of and control over all assets and resources
employed or entrusted by the Company for the benefit of the Company.
- Promptly report violations of this Code of Ethics to the Disclosure
Committee, the compliance hotline, or the Senior Vice President of
Compliance.
Violations of this Code of Ethics may result in disciplinary actions, up
to and including possible termination.
Complaints about accounting, accounting controls and audit matters should
be reported directly to the Chairman of the Audit Committee of the Board of
Directors of Molecular Insight Pharmaceuticals, Inc. or to the Compliance
Hotline at (800) 270-0082.
Adopted on November 16, 2005
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