EXHIBIT 14
DYNECO CORPORATION
CODE OF BUSINESS CONDUCT AND ETHICS
(ADOPTED BY THE BOARD OF DIRECTORS ON APRIL 12, 2005)
INTRODUCTION
This Code of Business Conduct and Ethics covers a wide range of
business practices and procedures. It does not cover every issue that may arise
but it sets out basic principles to guide all employees of the Company. All of
our officers, directors and employees must conduct themselves accordingly and
seek to avoid even the appearance of improper behavior. The code should also be
provided to and followed by the Company's agents and representatives, including
consultants.
If a law conflicts with a policy in this Code, you must comply with the
law. If you have any questions about these conflicts, you should ask your
supervisor how to handle the situation.
Those who violate standards in this Code will be subject to
disciplinary action, up to and including termination of employment. If you are
in a situation that you believe may violate or lead to a violation of this Code,
follow the guidelines described in Section 14 of this Code.
1. COMPLIANCE WITH LAWS, RULES AND REGULATIONS
Obey the law, both in letter and in spirit, is the foundation
on which our ethical standards are built. All employees must respect and obey
the laws of the cities, states and countries in which we operate. Although not
all employees are expected to know the details of these laws, it is important to
know enough about them to determine when to seek advice from supervisors,
managers or other appropriate personnel.
2. CONFLICTS OF INTEREST
A "conflict of interest" exists when a person's private
interests interferes 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 efficiently. Conflicts of interest may also arise when an
employee, officer or director, or members of his or her family, receives
improper personal benefits as a result of his or her position in the Company.
Loans to, or guarantees of obligations of, employees and their family members
may create conflicts of interest.
It is almost always a conflict of interest for a Company
employee to work simultaneously for a competitor, customer or supplier. You are
not allowed to work for a competitor as a consultant or board member. The best
policy is to avoid any direct or indirect business connection with our
customers, suppliers or competitors, except on our behalf. Conflicts of interest
are prohibited as a matter of Company policy, except under guidelines
1
approved by our Board of Directors. Conflicts of interest may not always be
clear-cut, so if you have a question, you should consult with higher levels of
management. 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 or consult with the procedures described in Section
14 of this Code.
3. INSIDER TRADING
Employees who have access to confidential information are not
permitted to use or share that information for stock trading purposes or for any
other purpose except the conduct of our business. All non-public information
about the Company should be considered confidential information. To use
non-public information for persona financial benefit or to "tip" others who
might make an investment decision on the basis of this information is not only
unethical but also illegal.
4. CORPORATE OPPORTUNITIES
Employees, officer and directors are prohibited from taking
for themselves personally, opportunities that are discovered through the use of
corporate property, information or position without the consent of the Board of
Directors. No employee may use corporate property, information or position for
improper personal gain, and no employee may compete with the Company, directly
or indirectly.
5. COMPETITION AND FAIR DEALING
We seek to outperform our competition fairly and honestly.
Stealing proprietary information, possessing trade secret information that was
obtained without the owner's consent, or inducing such disclosures by past or
present employees of other companies is prohibited. Each officer, director and
employee should respect the rights of and deal fairly with the Company's
customers, suppliers, competitors and employees. No employee should take unfair
advantage of anyone through manipulation, concealment, abuse of privileged
information, misrepresentation of material facts, or any other intentional
unfair-dealing practice.
The purpose of business entertainment and gifts in a
commercial setting is to create good will and sound working relationships, not
to gain unfair advantage with customers. No gift, or entertainment should ever
be offered, given, provided or accepted by any Company employee, family member
of an employee or agent, unless it (a) is not in cash, (b) is consistent with
customary business practices, (c) is not excessive in value, (d) cannot be
construed as a bribe or payoff and (e) does not violate any laws or regulations.
Please discuss with your supervisor any gifts or proposed gifts that you are not
certain are appropriate.
6. DISCRIMINATION AND HARASSMENT
The diversity of the Company's employees is a tremendous
asset. We are firmly committed to providing equal opportunity in all respects
aspects of employment and will not
2
tolerate illegal discrimination or harassment of any kind. Examples include
derogatory comments based on racial or ethnic characteristics and unwelcome
sexual advances.
7. HEALTH AND SAFETY
The Company strives to provide each employee with a safe and
healthy work environment. Each employee has responsibility for maintaining a
safe and healthy workplace for all employees by following safety and health
rules and practices and reporting accidents, injuries and unsafe equipment,
practices or conditions.
Violence and threatening behavior are not permitted. Employees
should report to work in condition to perform their duties, free from the
influence of illegal drugs or alcohol. The use of alcohol and/or illegal drugs
in the workplace will not be tolerated.
8. RECORD-KEEPING
The Company requires honest and accurate recording and
reporting of information in order to make responsible business decisions. For
example, only the true and actual number of hours worked should be reported.
Many employees regularly use business expense accounts, which
must be documented and recorded accurately. If you are not sure whether a
certain expense is legitimate, ask your supervisor or the Company's controller
or chief financial officer.
All of the Company's books, records, accounts and financial
statements must be maintained in reasonable detail, must appropriately reflect
the Company's transactions and must conform to both applicable legal
requirements and to the Company's systems of accounting and internal controls.
Unrecorded or "off the books" funds or assets should not be maintained unless
permitted by applicable laws or regulations.
Business records and communications often become public, and
we should avoid exaggeration, derogatory remarks, guesswork or inappropriate
characterizations of people and companies that can be misunderstood. This
applies equally to e-mail, internal memos and formal reports. Records should
always be retained or destroyed according to the Company's record retention
policies. In accordance with these policies, in the event of litigation or
governmental investigation please consultant your supervisor. All e-mail
communications are the property of the Company and employees, officers and
directors should not expect that Company or personal e-mail communications are
private. All e-mails are the property of the Company. No employee, officer or
director shall use Company computers, including to access the internet, for
personal or non-Company business.
9. CONFIDENTIALITY
Employees must maintain the confidentiality of confidential
information entrusted to them by the Company or its customers, except when
disclosure is required by laws or regulations. Confidential information includes
all non-public information that might be of use to competitors, or harmful to
the Company or its customers, if disclosed. It also includes
3
information that suppliers and customers have entrusted to us. The obligation to
preserve confidential information continues even after employment ends. In
connection with this obligation, employees, officers and directors may be
required to execute confidentiality agreements confirming their agreement to be
bound not to disclose confidential information. If you are uncertain whether
particular information is confidential or non-public, please consult your
supervisor.
10. PROTECTION AND PROPER USE OF COMPANY ASSETS
All officers, directors and employees should endeavor to
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
incident of fraud or theft should be immediately reported for investigation.
Company equipment should not be used for non-Company business.
The obligation of officers, directors and employees to protect
the Company's assets includes it proprietary information. Proprietary
information includes intellectual property such as trade secrets, patents,
trademarks and copyrights, as well as business, marketing and service plans,
engineering and manufacturing ideas, designs, databases, records, salary
information and any unpublished financial data and reports. Unauthorized use or
distribution of this information would violate Company policy. It could also be
illegal and result in civil or even criminal penalties.
11. PAYMENTS TO GOVERNMENT PERSONNEL
The Unites States Foreign Corrupt Practices Act prohibits
giving anything of value, directly or indirectly, to officials of foreign
governments or foreign political candidates in order to obtain or retain
business. It is strictly prohibited to make illegal payments to government
officials of any country.
In addition, the U. S. government has a number of laws and
regulations regarding business gratuities that may be accepted by U. S.
government personnel. The promise, offer or delivery to an official or employee
of the U. S. government of a gist, favor or other gratuity in violation of these
rules would not only violate Company policy, but could also be a criminal
offense. State and local governments, as well as foreign governments, may have
similar rules.
12. WAIVERS OF THE CODE OF BUSINESS CONDUCT AND ETHICS
Any waiver of the provisions of this Code may be made only by
the Board of Directors and will be promptly disclosed as required by law or
stock exchange rule or regulation.
13. REPORTING ANY ILLEGAL OR UNETHICAL BEHAVIOR
Employees are encouraged to talk with supervisors, managers or
Company officials about observed illegal or unethical behavior, and when in
doubt about the best course of action in a particular situation. It is the
Company's policy not to allow retaliation for reports of misconduct by others
made in good faith by employees. Employees are expected to cooperate in
4
internal investigations of misconduct, and the failure to do so could serve as
grounds for termination. Any employee may submit a good faith concern regarding
questionable accounting or auditing matters without fear of dismissal or
retaliation of any kind.
14. COMPLIANCE PROCEDURES
We must all work to ensure prompt and consistent action
against violations of this Code. However, in some situations, it is difficult to
know if a violation has occurred. Since we cannot anticipate every situation
that may arise, it is important that we have a way to approach a new question or
problem. These are steps to keep in mind:
o Make sure you have all the facts. In order to reach the rights
solutions, we must be as fully informed as possible.
o Ask yourself, what specifically am I being asked to do - does
it seem unethical or improper? This will enable you to focus
on the specific question you are faced with, and the
alternatives you have. Use your judgment and common sense; if
something seems unethical or improper, it probably is.
o Clarify your responsibility and role. In most situations,
there is shared responsibility. Are your colleagues informed?
It may help to get others involved and discuss the problem.
o Discuss the problem with your supervisor. This is the basic
guidance for all situations. In many cases, your supervisor
will be more knowledgeable about the question, and will
appreciate being brought into the decision-making process.
Keep in mind that it is your supervisor's responsibility to
help solve problems. If your supervisor does not or cannot
remedy the situation, or you are uncomfortable binging the
problem to the attention of your supervisor, bring the issue
to the attention of the human resources supervisor, or to an
officer of the Company.
o You may report ethical violations in confidence and without
fear of retaliation. If your situation requires that your
identity be kept secret, your anonymity will be protected. The
Company does not permit retaliation of any kind for good faith
reports of ethical violations.
o Always ask first - act later. If you are unsure of what to do
in any situation, seek guidance before your act.
5
CODE OF ETHICS FOR THE CHIEF EXECUTIVE OFFICER AND SENIOR
FINANCIAL OFFICERS
The Company has a Code of Business Conduct and Ethics
applicable to all employees, officers and directors of the Company. The Chief
Executive Officer (CEO) and senior financial officers of the Company, including
its chief financial officer and principal accounting officer, are bound by the
provisions set forth therein relating to ethical conduct, conflicts of interest
and compliance with law. In addition to the Code of Business Conduct and Ethics,
the CEO and senior financial officers of the Company are also subject to the
following specific policies:
1. The CEO and senior financial officers are responsible for
full, fair, accurate, timely and understandable disclosure in the periodic
reports and other filings required to be made by the Company with the Securities
and Exchange Commission. Accordingly, it is the responsibility of the CEO and
each senior financial officer promptly to bring to the attention of the Board of
Directors any material information of which he or she may become aware that
affects the disclosures made by the Company in its public filings or otherwise
impairs the ability of the Company to make full, fair, accurate, timely and
understandable public disclosures.
2. The CEO and each senior financial officer shall promptly bring
to the attention of the Company's Audit Committee any information he or she may
have concerning (a) significant deficiencies in the design or operation of
internal controls which could adversely affect the Company's ability to record,
process, summarize and report financial data or (b) any fraud, whether or not
material, that involves management or other employees who have a significant
role in the Company's financial reporting, disclosures or internal controls.
3. The CEO and each senior financial officer shall promptly bring
to the attention of the Board of Directors and the Audit Committee any
information he or she may have concerning any violation of the Company's Code of
Business Conduct and Ethics, including any actual or apparent conflicts of
interest between personal and processional relationships, involving management
or other employees who have a significant rule in the Company's financial
reporting, disclosures or internal controls.
4. The CEO and each senior financial officer shall promptly bring
to the attention of the Board of Directors and Audit Committee any information
he or she may have concerning evidence of a material violation of the securities
or other laws, rules or regulations applicable to the Company and the operation
of its business, by the Company or any agent thereof, or of violation of the
Code of Business Conduct and Ethics or of these additional procedures.
5. The Board of Directors shall determine, or designate
appropriate persons to determine, appropriate actions to be taken in the event
of violations of the Code of Business Conduct and Ethics of these additional
procedures by the CEO and the Company's senior financial officers. Such actions
shall be reasonably designed to deter wrongdoing and to promote accountability
for adherence to the Code of Business Conduct and Ethics and to these
6
additional procedures, and shall include written notices to the individual
involved that the Board has determined that there has been a violation, censure
by the Board, demotion or reassignment of the individual involved, suspension
with or without pay or benefits (as determined by the Board) and termination of
the individual's employment. In determining what action is appropriate in a
particular case, the Board of Directors or such designee shall take into account
all relevant information, including the nature and severity of the violation,
whether the violation was a single occurrence or repeated occurrences, whether
the violation appears to have been intentional or inadvertent, whether the
individual in question had been advised prior to the violation as to the proper
course of action and whether or not the individual in question had committed
other violations in the past.
7