It has always been the policy of Wayside Technology Group, Inc. (the "Company") to comply with the letter and spirit of all laws that govern our operations and to adhere to the highest standards of business ethics. Because we uphold those standards, the Company enjoys a reputation for excellence and fair dealing. But a good reputation must be diligently maintained; it can be lost much faster than it is acquired. No action is worth ruining that reputation. All actions must be viewed in that perspective.
With that in mind, the Company has developed the general legal and ethical guidelines you'll find in this Code of Ethics and Business Conduct (the "Code"). The guidelines won't provide an answer to every question that comes up. Nor will they make you an expert in anti-trust and other legal matters. These guidelines do not summarize all laws, rules and regulations applicable to the Company and its directors, officers or employees. They should, however, make you more aware of the law and guide your decisions including decisions about when to consult with others, such as your supervisor or manager. If you have any reason to doubt the legality of any action you plan to take on behalf of the Company, ask before you act.
The guidelines apply to all directors, officers and employees of the Company. All directors, officers and employees of the Company will be required to read this Code periodically.
The Company's Board of Directors (the "Board") has adopted this Code in order to:
- Promote honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest;
- Promote full, fair, accurate, 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;
- Promote compliance with applicable governmental laws, rules and regulations;
- Promote the protection of Company assets, including corporate opportunities and confidential information;
- Promote fair dealing practices; and
- Ensure accountability for adherence to the Code.
Anyone receiving such a report must immediately discuss the matter with a corporate officer and take action as management directs. All directors, officers and employees must cooperate fully with any investigation by Company representatives of an alleged violation. No director, officer or employee will suffer any penalty for reporting in good faith any suspected violation of the guidelines in this Code.
We will do everything in our power to make sure the Company adheres to these standards. We are counting on you to do the same. Together we can make sure that the Company maintains its good name and the rewards that reputation brings.
Compliance with applicable laws and regulations
Directors, officers and employees are responsible for complying, both in letter and spirit, with all applicable laws, rules and regulations in the cities, states and countries in which the Company operates as well as with this Code. Although not all directors, officers and employees are expected to know the details of all applicable laws, rules and regulations, it is important to know enough to determine when to seek advice from appropriate personnel. Anyone engaging in unethical conduct or illegal actions may be subject to disciplinary action, which may include termination by the Company.
Avoid conflict of interest
All directors, officers and employees of the Company should be scrupulous in avoiding a conflict of interest with regard to the Company's interests. A "conflict of interest" exists when a person's private interest interferes in any way (or even appears to interfere or conflict) with the interests of the Company. A conflict situation can arise when a director, officer or employee takes actions or has interests that may make it difficult to perform his or her Company work objectively and effectively. Conflicts of interest may also arise when a director, officer or employee, or members of his or her family, receives improper personal benefits as a result of his or her position in the Company, whether received from the Company or a third party. Loans to, or guarantees of obligations of, employees and their family members may create conflicts of interest. Federal law prohibits loans to directors and executive officers.
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 approved by the Board or a committee of the Board. Conflicts of interest may not always be clear-cut, so if you have a question, you should consult with higher levels of management of the Company. Any director, officer or employee 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 the procedures described below under "Reporting Violations."
The Company generally doesn't restrict you from investing or participating in other businesses. However, you need to avoid relationships and activities that might influence or appear to influence your ability to make fair decisions while doing your work for the Company.
While that guideline applies to all directors, officers and employees, certain directors, officers and employees are required to disclose outside business interests (and any other potential conflicts of interest) to the Company. Those directors, officers and employees, and their immediate family members, should not have any undisclosed investment or other financial interest, including employment, in a business that:
- competes with;
- sells materials or services to; or
- is a customer of the Company.
The Company prides itself on fair dealing and honest relationships with customers and suppliers. To maintain those relationships, it's important to avoid even the appearance of favoritism. For that reason, accepting gifts or anything of more than nominal value from suppliers, or giving the same to customers, is against Company policy. Under certain circumstances, giving, offering or accepting a gift is a crime. Please observe the following guidelines:
- You and your immediate family members may not accept money in any amount from a supplier.
- You and your immediate family may not accept a discount on personal purchases of a supplier's product if the discount is, or could be interpreted as, being offered because of the Company's business relationship. An exception is allowed for discounts that are offered to all employees and have been approved by the Company.
- You may not ask a supplier or potential supplier for a gift, entertainment or favor, either directly or through another party.
- You may accept a tangible gift involving normal sales promotion, advertising or publicity, such as a coffee mug or calendar, from a supplier or potential supplier. Such gifts may not exceed $100 in value.
- You may accept meals, refreshments and modest entertainment from a supplier or potential supplier. Use prudent judgment when accepting them. Such gifts should not be lavish, extravagant, frequent or long in duration.
- Generally speaking, you should not offer or give a tangible gift or any favor worth more than $100 to a customer, either directly or through another party. If you would like to give a gift worth more than $100, it needs to be approved by a corporate officer.
- You, however, may provide meals, refreshments and modest entertainment to a customer in conjunction with business discussions. Again, use prudent judgment.
- You also may provide a tangible gift involving normal sales promotion to a customer. Again, such gifts may not exceed $100 in value.
Participate in politics - voluntarily
To preserve and strengthen our system of government, the Company encourages directors, officers and employees, as individuals, to vote and work for political parties, candidates, and to voluntarily contribute personal funds to parties, candidates and nonpartisan groups supporting good government. Lawful political preferences, opinions and activities will have no effect on any aspect of employment, including assignment, working conditions, pay and promotion. In keeping with the law, corporate funds and assets may not be used for political campaigns.
Keep accurate financial records; ensure accurate disclosure
The Company has a responsibility to potential investors, shareholders, creditors and government agencies to maintain and furnish reliable financial information in a timely manner. Company books and records must accurately reflect transactions and the status and use of assets. In keeping with that responsibility:
- Keep books and records accurate and up-to-date - whether you're making entries and recording transactions or asking someone else to do so.
- Do not establish any undisclosed or unrecorded fund.
In addition, the Chief Executive Officer ("CEO") and the senior financial officers (the principal financial officer and comptroller or principal accounting officer, or persons performing similar functions) are responsible for full, fair, accurate, timely and understandable disclosure in the periodic reports required to be filed 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 Audit Committee of the Board (the "Audit Committee") 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 assist the Audit Committee in fulfilling its responsibilities as specified in the charter of the Audit Committee.
The Company's policy is to comply with all applicable financial reporting and accounting regulations applicable to the Company. If any director, officer or employer of the Company has concerns or complaints regarding questionable accounting or auditing matters of the Company, then he or she is encouraged to submit those concerns or complaints (anonymously, confidentially or otherwise) to the Audit Committee which will, subject to its duties arising under applicable law, regulations and legal proceedings, treat such submissions confidentially. These submissions may be directed to the attention of the Audit Committee, or any director who is a member of the Audit Committee, at the principal executive offices of the Company.
Protect confidential information
Another important Company asset is information gathered to maintain and develop business. This information is proprietary and strictly confidential. In addition to any other obligation that you may have to keep the Company's information confidential and in keeping with the importance of this information:
- Do not disclose confidential information to anyone outside the Company unless the disclosure is necessary to further the Company's interest.
- Do not use confidential information for anything other than Company business.
- Financial results and records not made in public.
- Personnel records and systems.
- Business and sales prospects and commitments.
- Technical developments and inventions.
- Information concerning or obtained from customers and suppliers.
- Any information in the Company's computer systems.
- Familiarize yourself with import/export restrictions, if necessary
- Exports of commodities and technical data from the United States and other countries often are subject to export control laws. Requirements depend on the destination, product and/or proposed use of the product. Export control laws generally apply to re-exports as well. If you are responsible for export and re-export transactions, familiarize yourself with all applicable requirements and, when in doubt, seek guidance from your manager or supervisor.
The Company is committed to providing a drug-free and safe work environment. Everyone is responsible for compliance with applicable health and safety laws and regulations. Officers and employees must do their part by:
- Accepting responsibility for safety.
- Knowing the hazards associated with each job assignment and operating equipment accordingly.
- Observing posted warnings and regulations.
- Reporting to supervisors any accident or injury sustained on the job.
- Reporting to supervisors any operation of equipment or performance of processes that is not in accordance with standard operating procedures.
- Asking questions and reporting violations or potential violations in accordance with the sections in this Code on "Asking Questions" and "Reporting Violations."
Promote a positive work environment
The Company has an obligation to employ the best people available. It is the Company's policy to promote a diverse workforce by hiring and developing qualified people regardless of their age, race, color, religion, sex, sexual orientation, national origin, disability or political preference. In addition, the Company wants to provide a workplace free from any form of harassment, including sexual, religious or racial harassment. Any such harassment is prohibited. In accordance with applicable laws, we will continue to direct our employment and personnel practices toward ensuring truly equal opportunity for everyone. All recruiting, hiring, training, compensation, benefits, promotions, transfers, layoffs, recall from layoffs, company-sponsored educational, social and recreational programs and all treatment on the job will be free of discriminatory practices. All employees have a responsibility to act appropriately in the workplace and are expected to follow these policies and promote a positive work environment for all. Managers and supervisors are particularly responsible for ensuring equal participation in the opportunities available at the Company.
Guidelines For Dealing With Competitors, Customers And Suppliers
Antitrust laws are strict laws that protect the free enterprise system. They deal with agreements and practices that restrain fair trade, such as price fixing and boycotting suppliers and customers. Many countries have enacted antitrust laws that regulate business and trade on the premise that fair competition will yield the lowest prices, highest quality and greatest economic progress for all.
In the United States, the principal laws regulating business and trade are the Sherman Act, Clayton Act, Robinson-Patman Act and Federal Trade Commission Act. In addition to governing domestic activities in the United States, U.S. antitrust laws also apply to import and export transactions to and from the United States.
All directors, officers and employees are expected to comply with any applicable antitrust laws. The following guidelines will help you conduct yourself in situations governed by U.S. antitrust laws. If you're involved in any international business transactions:
- Familiarize yourself with appropriate antitrust and other legislation.
- Follow any established Company guidelines for dealing with U.S. competitors, customers and suppliers - unless foreign law is stricter. In that case, foreign law applies.
- Consult your manager or supervisor with any questions concerning antitrust compliance before conducting any negotiations or proceeding with any agreements, mergers, joint ventures and other transactions.
- Prices to be charged for products or services both companies make or provide - a practice known as price fixing.
- Prices include base prices, extras and transportation charges, as well as other sales terms that relate to price, such as credit terms and discounts.
- Limiting production, including the amount and type of production.
- Division or allocation of customers or sales territories.
- Boycotting a potential customers or potential supplier.
Watch what you commit to in writing
Every memo, letter, proposal, quotation or other correspondence dealing with the subject of competition or competitive prices should merely state facts and should contain no editorial comments. All communications and representations must be completely accurate and truthful.
Be careful about contact with competitors
Competitors are usually subject to similar economic pressures, and independent decisions by each could produce similar results. Because of this, antitrust enforcement agencies and courts are quick to suspect collusion among competitors. It is imperative to avoid contacts with competitors that might support a charge of collusion. Conduct relations with competitors as if you are at all times in the public view. Get approval before joining a trade association.
Trade and standards organizations help companies exchange valuable information on a wide variety of matters common to the industry - technical developments, safety, labor relations, regulations and statistics. However, because they provide opportunities for formal and informal gatherings of competitors, they expose everyone present to charges of collusion if meetings are followed by illegal action. For that reason, directors, officers and employees are not permitted to join any trade association unless management has determined that:
- The association serves an important and proper purpose.
- All of the association's activities are adequately supervised by legal counsel, particularly in locations where trade regulations make it prudent to do so.
- Confine discussions to items on the meeting agenda.
- Refuse to listen to or engage in informal discussion of any of the prohibited subject areas stated previously.
- Immediately leave a meeting or gathering if such a discussion begins. Walk away from the speaker or hang up the telephone, if necessary. If you allow yourself to listen to such a conversation, you may be required to testify that it did take place, and it would be difficult to avoid the implication that you actively participated in it.
- Immediately report any such discussion in accordance with the sections in this Code on "Asking Questions" and "Reporting Violations."
Choose customers and suppliers fairly
Generally speaking, a seller has the right to refuse to deal with any person or concern it does not want as a customer. This is also true for buyers selecting suppliers. Reasons for refusing to deal with a customer or supplier can include deficient performance, financial irresponsibility and reputation.
Avoid accepting unlawful pricing
When purchasing supplies, a buyer may not induce or knowingly accept a price that would be illegal for the supplier to give. If you believe a supplier is offering you an unlawful price, seek guidance from your supervisor or manager.
Corporate Disclosure Policy
All directors, officers and employees must familiarize themselves with and follow the Company's policy, approved by the Board, governing communications by directors, officers and employees with securities analysts, fund managers, other securities market professionals, reporters, securityholders and others who are not bound by a duty of confidentiality to the Company.
Statement of Policy Concerning Trading Policies and Conflicts of Interest
All directors, officers and employees must familiarize themselves with and follow the Company's statement of policy regarding compliance with all applicable securities laws and regulations and the avoidance of conflicts of interest.
The Company is committed to giving guidance to all directors, officers and employees about standards of ethics and compliance requirements. An employee with questions is encouraged to seek clarification through normal channels directly to his or her supervisor or manager.
Supervisors and managers and who receive questions may give a direct response to an employee if the employee merely raises a question that they can answer or that can be answered with the help of another appropriate person or department. Otherwise, a manager or supervisor shall contact a corporate officer.
Every director, officer and employee of the Company has the responsibility to report a violation of any law or a breach of the Company's ethical standards. An employee who knows about a violation, or reasonably believes there has been a violation, is encouraged to report that information through normal reporting channels directly to his or her supervisor or manager. Actions prohibited by this code involving directors or executive officers must be reported to the Audit Committee.
Supervisors and managers who receive reports of violations have a duty to handle them properly. They may give a direct response to an employee if the report merely raises a question that they can answer or that can be answered with the help of another appropriate person or department. Otherwise, the supervisor or manager will contact a corporate officer and forward the report to the Audit Committee and take such other action as may be required.
Directors, officers and employees who report a violation or suspected violation will not be subject to retaliation because of any report made in good faith. However, individuals who knowingly submit a false report shall be subject to disciplinary action. Any officer or employee of the Company who does retaliate against an individual submitting a report shall be subject to disciplinary action.
The Audit Committee will review any reports received by supervisors, managers, corporate officers and directors hereunder at least once yearly.
Amendments to, and Waivers from, the Code
Any amendment to, or waiver from, this Code relating to executive officers, directors or senior financial officers (CEO, CFO, principal accounting officer, controller or persons performing similar functions) may be made only by a majority of the independent directors on the Board or the nominating/corporate governance or similar Board committee, and will be promptly disclosed as required by law, regulation or NASD Marketplace Rule.