Corporate Governance
SUPPLYTEK INTERNATIONAL, SA DE CV.
CODE OF BUSINESS CONDUCT AND ETHICS
(February 24th, 2014)
The Board of Directors (the "Board") of 4PL International, SA de CV. (the "Company") has adopted this Code of Business Conduct and Ethics (the "Code"). This Code applies to the directors, officers, and employees of the Company (the "Covered Persons"). This Code 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 Covered Persons. All Covered Persons should conduct themselves accordingly and seek to avoid the appearance of improper behavior in any way relating to the Company.
If a law conflicts with a policy in the Code, you must comply with the law. Any Covered Person who has any questions about the Code should consult with such person's supervisor, the Chief Executive Officer, the Board, or the Company's audit committee (the "Audit Committee").
Those who violate the law or the standards in the Code will be subject to disciplinary action, up to and including immediate termination, and may be subject to substantial civil damages, criminal fines, and prison terms. The Company may also face substantial fines and penalties and may incur damage to its reputation and standing in the community.
The Company has adopted the Code for the purpose of promoting honest and ethical behavior and conduct, including:
• ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
• full, fair, accurate, timely, and understandable disclosure in all reports and documents that the Company files or submits and in all public communications made by the Company;• compliance with applicable governmental laws, rules, and regulations;
• prompt internal reporting of violations of this Code to an appropriate person or persons identified herein; and
• accountability for adherence to the Code.
The Code is a statement of certain fundamental principles, policies, and guidelines that govern the Company's Covered Persons in the conduct of the Company's business. It is not intended to and does not create any rights in any employee, customer, supplier, competitor, shareholder, or any other person or entity.
CONFLICTS OF INTEREST
Each Covered Person must adhere to a high standard of business ethics and is expected to make decisions and take actions based on the best interests of the Company, as a whole, and not based on private relationships or benefits. A conflict situation can arise when a Covered Person takes actions or has interests that may make it difficult to perform his or her work for the Company objectively and effectively.
Conflicts of interest also arise when a Covered Person or a member of his or her family receives improper personal benefits, including without limitation improper gifts, entertainment, or other benefits, as a result of his or her position in the Company. "Members of his or her family" means a Covered Person's spouse, parents, children, siblings, grandparents, stepmother, stepfather, stepsisters, stepbrothers, stepchildren, uncles, aunts, nephews, nieces, cousins, in-laws within one of these categories, or any other person with whom you have a significant-close personal relationship as determined by the Company. Loans by the Company to, or guarantees of obligations of, such Covered Person or members of his or her family are of special concern and could constitute improper personal benefits to the recipients of such loans or guarantees, depending on the facts and circumstances. Loans by the Company to, or guarantees by the Company of obligations of, any director or officer or their family members are expressly prohibited.
Conflicts of interest may not always be clear-cut. Any Covered Person who has any questions as to whether a conflict of interest exists should consult with such person's supervisor, the Company's Chief Executive Officer, the Board, or the Audit Committee.
Examples of a clear conflict of interest situations that should always be raised with the chairperson of the audit committee are listed below. These examples are not a comprehensive list of all possible conflicts of interest.
• any significant ownership interest in any supplier or customer;
• any consulting or employment relationship with any supplier, customer or competitor;
• any outside business activity that detracts from a Covered Person's ability to devote appropriate time and attention to his or her responsibilities within the Company;
• the receipt of not insignificant gifts from any company or person with which the Company have current or prospective business dealing;
• being in the position of supervising, reviewing, or having any influence on the job evaluation, pay or benefit of any immediate family member of a Covered Person; and
• selling anything to or buying anything from the Company, except on the same terms and conditions as comparable officers or directors are permitted to buy or sell.
Business decisions and actions must be made in the best interests of the Company and should not be influenced by private considerations or relationships. Relationships with the Company's stakeholders, including suppliers, competitors, and customers, should not in any way affect a Covered Person's responsibility and accountability to the Company.
Specifically, each Covered Person must:
1. act with integrity, including being honest and candid while still maintaining the confidentiality of information when required or consistent with the Company's policies;
2. avoid violations of the Code, including actual or apparent conflicts of interest with the Company in personal and professional relationships;
3. disclose to the Board or the Audit Committee any material transaction or relationship that could reasonably be expected to give rise to a breach of the Code, including actual or apparent conflicts of interest with the Company;
4. obtain approval from the Board or Audit Committee before making any decisions or taking any action that could reasonably be expected to involve a conflict of interest or the appearance of a conflict of interest;
5. observe both the form and spirit of laws and governmental rules and regulations, accounting standards and company policies;
6. maintain a high standard of accuracy and completeness in the Company's financial records;
7. ensure full, fair, timely, accurate, and understandable disclosure in the Company's periodic reports;
8. report any violations of the Code to the Board or Audit Committee;
9. proactively promote ethical behavior among peers in his or her work environment; and
10. maintain the skills appropriate and necessary for the performance of his or her duties.
In the event of a violation of the conflicts of interest law, a Covered Person may, under applicable state law, not be entitled to any indemnification payments by the Company. Further, insurance coverage for directors and officers may not be applicable due to a traditional exception with respect to any conduct in connection with a conflict of interest.
DISCLOSURE OF COMPANY INFORMATION
The Company takes its public disclosure responsibility seriously to ensure that any and all reports furnish the marketplace with full, fair, accurate, and timely disclosure regarding the financial and business condition of the Company. All disclosures contained in reports and documents filed with the government on behalf of the Company or contained in other public communications made by the Company must comply with applicable Mexican federal laws, rules, policies and instruments and must be complete and correct in all material respects. The Covered Persons, in relation to his or her area of responsibility, must be committed to providing timely, consistent and accurate information, in compliance with applicable laws. It is imperative that this disclosure be accomplished consistently during both good times and bad.
Each Covered Person who contributes in any way to the preparation or verification of the Company's financial statements and other financial information must ensure that all of the Company's books, records, accounts and financial statements are accurately maintained in reasonable detail, must appropriately reflect the Company's transactions, and must conform both to applicable legal requirements and to the Company's system of internal controls. Unrecorded or "off the book" funds, assets or liabilities should not be maintained unless permitted by applicable law or regulation. Covered Persons involved in the preparation of the Company's financial statements must prepare those statements in accordance with the English language version of International Financial Reporting Standards as issued by the International Accounting Standards Board and applicable rules and regulations. Further, it is important that financial statements and related disclosures be free of material errors.
Specifically, each Covered Person who is involved in the Company's disclosure process must:
1. familiarize himself or herself with the disclosure requirements generally applicable to the Company including the Company's disclosure controls and procedures and its internal control over financial reporting;
2. not knowingly misrepresent, or cause others to misrepresent, facts about the Company to others, including the Company's independent auditors, governmental regulators, self-regulating organizations, and other government officials;
3. to the extent that he or she participates in the creation of the Company's books and records, promote the accuracy, fairness, and timeliness of those records;
4. in relation to his or her area of responsibility, properly review and critically analyze proposed disclosure for accuracy and completeness;
5. cooperate fully with the Company's accounting and internal audit departments, as well as the Company's independent public accountants and counsel; and
6. take all necessary steps to ensure that all filings with the authorities and all other public communications about the financial and business condition of the Company provide full, fair, accurate, timely, and understandable disclosure.
CONFIDENTIAL INFORMATION
Covered Persons must maintain the confidentiality of confidential information entrusted to them by the Company or its customers, suppliers, joint venture partners, or others with whom the Company is considering a business or other transaction except when disclosure is authorized by the Board or an executive officer or required or mandated by laws or regulations. Confidential information includes, without limitation, all non-public information that might be useful or helpful to competitors, or harmful to the Company or its customers or suppliers, if disclosed. It also includes information that suppliers, customers and other parties have entrusted to the Company. The obligation to preserve confidential information continues even after employment ends.
Records containing personal data about employees or private information about customers and their employees are confidential. They are to be carefully safeguarded, kept current, relevant and accurate. They may be disclosed only to authorized personnel or as required by law.
All inquiries regarding the Company from non-employees, such as financial analysts and journalists, should be directed to the Chief Executive Officer or the Board. The Company's policy is to cooperate with every reasonable request of government investigators for information. At the same time, the Company is entitled to all the safeguards provided by law for the benefit of persons under investigation or accused of wrongdoing, including legal representation. If a representative of any government or government agency seeks an interview or requests access to data or documents for the purposes of an investigation, the Covered Person should refer the representative to the Chief Executive Officer, the Board or the Audit Committee. Covered Persons also should preserve all materials, including documents and e-mails that might relate to any pending or reasonably possible investigation.
COMPLIANCE WITH LAWS
The Covered Persons must respect and obey all applicable foreign, federal, state, and local laws, rules, and regulations of the jurisdiction in which the Company operates. Although not all Covered Persons are expected to know the details of all such applicable laws, rules, and regulations, it is important to know enough to determine when to seek advice from appropriate personnel. Questions about compliance should be addressed to the Covered Person's supervisor or the Company's Chief Executive Officer.
Covered Persons who are not sure whether the information is "material" or "non-public information" should consult with the Company's Chief Executive officer or legal counsel for guidance before engaging in a transaction or assume that the information is "non-public" and treat it as confidential.
CORPORATE OPPORTUNITIES
Covered Persons are prohibited from: (angel) taking for themselves personally opportunities that are discovered through the use of corporate property, information or position; (beer) using Company property, information, or position for personal gain; and (coffee) competing with the Company. Covered Persons owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises.
FAIR DEALINGS
Each Covered Person should endeavor to deal fairly with the Company's customers, suppliers, competitors, and employees. No Covered Person should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other unfair dealing practice.
PROTECTION AND PROPER USE OF COMPANY ASSETS
Covered Persons should protect the Company's assets and ensure their efficient use. Theft, carelessness, and waste have a direct impact on the Company's profitability. All listed company assets should be used for legitimate business purposes. To ensure the protection and proper use of the Company's assets, each Covered Person should:
• exercise reasonable care to prevent theft, damage, or misuse of Company property;
• report the actual or suspected theft, damage, or misuse of Company property to a supervisor;
• use the Company's telephone system, other electronic communication services, written materials, and other property primarily for business-related purposes;
• safeguard all electronic programs, data, communications, and written materials from inadvertent access by others; and
• use Company property only for legitimate business purposes, as authorized in connection with such covered Person's job responsibilities, or as otherwise permitted herein.
Company property includes all data and communications transmitted or received to or by, or contained in, the Company's electronic or telephonic systems. Company property also includes all written communications. Covered Persons and other users of this property should have no expectation of privacy with respect to these communications and data. To the extent permitted by law, the Company has the ability, and reserves the right, to monitor all electronic and telephonic communication. These communications may also be subject to disclosure to law enforcement or government officials.
REPORTING ACTUAL AND POTENTIAL VIOLATIONS OF THE CODE AND ACCOUNTABILITY FOR COMPLIANCE WITH THE CODE
The Company, through the Board or the Audit Committee, is responsible for applying this Code to specific situations in which questions may arise and has the authority to interpret this Code in any particular situation. This Code is not intended to provide a comprehensive guideline for Covered Persons in relation to their business activities with the Company. Any Covered Person may seek clarification on the application of this Code from the Board or the Audit Committee.
Each Covered Person must:
1. notify the Audit Committee of any existing or potential violation of laws, rules, regulations or this Code by a director or executive officer and such Covered Person's supervisor or the Chief Executive Officer of any existing or potential violation of this Code, and failure to do so is itself a breach of the Code; and
2. not retaliate, directly or indirectly, or encourage others to do so, against any employee or Covered Person for reports, made in good faith, of any misconduct or violations of the Code solely because that employee or Covered Person raised a legitimate ethical issue.
The Board or the Audit Committee will take all action it considers appropriate to investigate any breach of the Code reported to it. All Covered Persons, directors and employees are required to cooperate fully with any such investigation and to provide truthful and accurate information. If the Board or the Audit Committee determines that a breach has occurred, it will take or authorize disciplinary or preventative action as it deems appropriate, after consultation with the Company's counsel if warranted, up to and including termination of employment. Where appropriate, the Company will not limit itself to disciplinary action but may pursue legal action against the offending Covered Person involved. In some cases, the Company may have a legal or ethical obligation to call violations to the attention of appropriate enforcement authorities.
Compliance with the Code may be monitored by audits performed by the Board, the Audit Committee, the Company's counsel and/or by the Company's outside auditors. All Covered Persons, directors and employees are required to cooperate fully with any such audits and to provide truthful and accurate information.
Any waiver of this Code for any Covered Person may be made only by the Board or the Audit Committee and will be promptly disclosed in accordance with applicable Securities Laws.
This Code of Business Conduct and Ethics is not a contract of employment or a guarantee of a continuing policy of the Company. The Company may amend, supplement, or discontinue this Code of Business Conduct and Ethics or any part of it at any time in its sole discretion.