Exhibit
14.2
Amended
January 2007
Argan,
Inc.
Code
of Conduct
General
The
honesty, loyalty, concern for others and accountability of our actions is
fundamental to the reputation and success of Argan, Inc. and its subsidiaries
(Argan). The directors, officers and employees of Argan, wherever located,
collectively referred to herein as “employees,” are subject to the provisions of
our Code of Conduct. We are expected to be sensitive to any situations that
can
adversely impact Argan’s reputation and are expected to use good judgment and
common sense in the way we conduct business.
The
Code
of Conduct is designed to help you understand what is meant by good judgment
and
ethical behavior. These policies are part of our corporate governance
regulations. All employees must comply with these regulations and there upon
act
in a reputable manner.
The
Code
of Conduct is intended to supplement other policies and procedures of the
company, and is not considered an employment contract. It does however, set
forth expectations of behaviors in Argan employees in certain situations.
Employees who violate the spirit of the Code of Conduct are subject to
disciplinary action up to and including termination of employment.
The
Argan employee personal responsibility
Every
Argan employee has a personal responsibility to embody and model behavior
that
complies with these guidelines and to:
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Learn
the details of all policies that affect your job. While you are
not
expected to know all policies of the Company, you should have a
basic
understanding of company policy and a detailed understanding of
policies
that apply to your job.
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Seek
assistance from appropriate management when you have a question
about the
application of a policy.
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Raise
issues and concerns with your supervisor or manager. If the issue
is not
resolved, raise it with the Vice President of Finance. If it is
still not
resolved call the anonymous Hot line number listed at the end of
this Code
of Conduct.
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You
may raise your concerns verbally or in writing and it may be
anonymous.
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The
leaders at Argan are expected to build and maintain a culture of compliance
by:
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Leading
by example, using their own behavior as a model for all
employees.
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Making
sure that employees understand that business results are never
more
important than compliance.
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Encouraging
employees to raise ethical questions and
concerns.
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Providing
access to education, training, and legal counseling to ensure that
employees, affiliates, and where appropriate, third parties understand
the
requirements of Argan policies and applicable
laws.
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Implementing
appropriate control measures in business process, to detect heightened
compliance risks and/or violations.
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Taking
prompt corrective action to fix any identified weaknesses in
compliance
measures.
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Everyone
has a duty to be vigilant for circumstances that may indicate illegal or
unethical behavior and to act appropriately in a timely manner to prevent
improper conduct.
Working
within the Argan community
Fair
and Equitable Treatment
Argan
strives to build and maintain a productive, motivated workforce by treating
all
employees fairly and equitably. We select and place employees on the basis
of
their qualifications for the work to be performed, without regard to race,
color, gender, sexual orientation, national origin, ancestry, religion, physical
or mental disability, age, veteran status or other characteristics protected
by
applicable law. Every employee should be fair and respectful in his or her
dealings with fellow employees.
Argan
will not tolerate harassment of its employees by anyone, including managers,
co-workers, contractors, vendors or customers. Our policies on diversity
and
equal employment are set forth below.
Diversity
and Equal Opportunity
Argan
recognizes that diversity brings benefits to the company -- ways of thinking
and
approaches to decision making that can make us more successful. We value
the
differences among individuals and welcome diversity within our workforce.
Each
Argan manager shall ensure that all applicants and employees are afforded
an
equal opportunity in employment. We support and obey laws that prohibit
discrimination everywhere we do business.
Employee
Health and Safety
Argan
strives to provide each employee with a safe and healthy work environment.
Each
employee has a responsibility to maintain a safe and healthy workplace for
all
employees. Employees should report to their supervisor workplace accidents
and
injuries, as well as 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 or possession of illegal drugs in the workplace is
prohibited.
Respect
for the Environment
Argan
employees will respect the environment by complying with all applicable
environmental laws in all jurisdictions in which we conduct business operations.
Argan is committed to the protection of the environment by minimizing the
environmental impact of our operations. Argan’s employees should notify their
supervisor or manager if hazardous materials come into contact with the
environment or are improperly handled or discarded.
Working
Within the Legal System
Compliance
with Laws
Argan's
policy is that all employees shall conduct business on behalf of the company
in
full compliance with the laws of the jurisdictions in which we operate. There
may be uncertainty with respect to the scope and application of certain of
the
laws in some jurisdictions. Compliance with our policy requires a good faith
effort to satisfy the intent and purpose of the applicable laws, consistent
with
our policy of ethical and honest business conduct. Any employee who acquires
knowledge of a violation of law, or who requires guidance on a matter of
law,
should consult with their supervisor or manager.
Contracting
practices
When
Argan is selling or buying products and services, or entering into other
commitments, Argan must consider the rights and obligations of each party
in
appropriate written contracts. Properly written contracts document the use
of
Argan funds and assets, define the rights and obligations of Argan and other
parties, establish protections against liability, and provide tools for handling
disputes. If you are involved in negotiating with Argan customers, suppliers,
other business partners or outside parties, you are required to understand
basic
principles of business transactions and to abide by Argan contracting policies
and guidelines.
You
may
not commit Argan to undertake any performance, payment or other obligation
unless you are authorized under the appropriate delegation of authority
policies.
You
may
not enter into any agreement or engage in any activity that may violate
applicable law. You may not enter into any transaction that facilitates improper
revenue recognition, expense treatment or other accounting improprieties
on the
part of either Argan or the business partner.
Protecting
Argan's Assets and Opportunities
Protecting
and safeguarding Argan’s assets, including tangible and intangible property, is
critical to Argan’s success. We have a duty to use those assets for legitimate
business purposes only, to protect them from loss or unauthorized use and
to
keep them confidential as appropriate. In no event may Argan assets be used
for
unlawful or improper purposes. Every employee has a responsibility to protect
our assets. Theft, misuse and waste of assets have an impact on Argan's
profitability. Theft, embezzlement or misappropriation of Argan property
by any
employee is prohibited. Argan equipment should not be used for non-company
business.
The
obligation of employees to protect Argan's assets includes its proprietary
information, such as trade secrets, patents, trademarks, business and marketing
plans, engineering and manufacturing ideas and unpublished financial data.
Unauthorized use or distribution of proprietary information is a violation
of
Argan policy.
Finance
and Accounting Practices
It
is a
legal requirement that, as a public company, Argan adheres to strict accounting
principles and standards of reporting. Financial information must be accurate
and complete, and there must be internal controls and processes to comply
with
these accounting and financial reporting laws. These laws require the proper
recording of, and accounting for, revenues and expenses. If an employee has
responsibility or any involvement in these areas, they must understand and
adhere to these rules. Also, these rules prohibit anyone from assisting others
to engage in improper accounting practices or make false or misleading financial
reports.
Violations
of laws associated with accounting and financial reporting can result in
fines,
penalties, and even imprisonment, and can lead to loss of public faith in
a
company. If you become aware of any action related to accounting or financial
reporting that you believe may be improper, you should immediately report
it to
your manager, the Vice President of Finance or by contacting the anonymous
Hotline number listed at the end of this Code of Conduct.
Political
Activities
Argan
employees are encouraged to take an active interest in political and government
activities and to support principles, issues, parties or candidates of their
own
choice. Such activity must remain separate and distinct from employment with
Argan.
Argan
policy goes beyond federal law, which prohibits the use of company funds,
assets, services or facilities on behalf of a federal political party or
candidate except under limited circumstances. Our policy is that no Argan
assets
-- including monetary payments, employees' work time, use of Argan premises
or
equipment -- may be contributed to any political candidate, political action
committee, party, or ballot measure without the written permission of the
Chief
Financial Officer. An Argan employee will not be compensated or reimbursed,
in
any form, for a political contribution that the person has made.
Preservation
of Certain Records
For
business, accounting and legal reasons our company records must be properly
managed. We create, retain and dispose of our business records and information
assets, both written and electronic, as part of our normal course of business
in
compliance with applicable regulatory and legal requirements. Information
defined as essential must be retained in a recoverable format for as long
as it
remains essential. Information that is no longer essential should be disposed
of
as soon as possible. For questions regarding what is essential information,
contact the Vice President of Finance.
In
no
case may business records or documents involved in a pending or threatened
litigation, government inquiry or under subpoena or other information request,
be discarded or destroyed. In addition, you may never destroy, alter, or
conceal, with an improper purpose, any record or otherwise impede any official
proceeding, either personally, in conjunction with, or by attempting to
influence, another person. You are required to cooperate fully with legal
counsel retained in the course of a lawsuit, legal proceeding or
investigation.
Confidential
Information
Argan
has
developed and continues to develop and use commercially valuable confidential
and/or proprietary technical and non-technical information. Confidential
information includes a wide range of non-public information including but
not
limited to financial and cost data, business plans and strategies, operating
reports, pricing information, marketing and sales data, business partner
information, proprietary information, personnel records and organization
charts.
Appropriate security measures to protect confidential information from improper
disclosure should be taken seriously by all employees.
Employees
must maintain the confidentiality of such information. You may not, directly
or
indirectly, disclose, or use for the benefit of yourself or any other person,
any of our confidential or proprietary information.
Media
Inquiries
Federal
law also restricts the manner in which Argan releases material information
to
the media, security analysts and stockholders. Argan has an obligation to
accurately and completely convey all material facts when speaking publicly.
In
order to ensure that Argan complies with its obligations, employees receiving
inquiries regarding material company information or Argan's position on public
issues should refer the request to the Corporate headquarters at Argan, Inc.,
One Church Street, Suite 401, Rockville, MD 20850 or call
301-315-0027.
Inside
Information
Federal
law prohibits insiders from trading securities while in possession of material
nonpublic information. Argan's policy also prohibits such trading. Any employee
who is aware of material nonpublic information related to Argan, or to firms
which are suppliers or customers of Argan, may not buy or sell common stock
of
Argan or such other company. You may not disclose such information to any
person
outside Argan until it has been made public. You cannot "tip" others. Securities
trading by your family members, household members or those with whom you
have a
close, personal relationship can, under some circumstances, result in legal
liability to you.
Material
information is any information that a reasonable investor would consider
important in deciding whether to buy or sell common stock. This includes
information about possible acquisitions or divestitures, earnings, new contracts
or products, expansion plans and other important corporate developments that
have not been publicly disclosed. You should refer to the Argan Trading Policy
if you have any questions concerning your buying or selling of Argan common
stock.
Many
senior-level Argan employees are subject to special rules on insider trading.
Unless otherwise advised, these employees can only buy or sell Argan common
stock during limited periods following the release of quarterly or annual
earnings information. Such "window" periods are open two days after, the
earliest of, any quarterly or annual reporting period press release or SEC
filing, but 30 days before the close of a quarterly or annual reporting period.
Refer to Argan’s Insider Trading Policy for further information.
Avoiding
Conflicts of Interest
Argan
employees are expected to make business decisions based on the best interests
of
the company and not based on personal relationships or benefits. Conflicts
of
interest can compromise employees' business ethics. A conflict of interest
arises when an activity, investment, interest or association interferes with
or
appears to interfere with the independent exercise of an employee's judgment
as
it relates to Argan's interests. A conflict of interest arises if an employee
works for or has an ownership interest in a competitor, customer or
supplier.
Employees
must disclose any situations that may involve conflicts of interest affecting
them personally. Waivers of conflicts of interest involving employees require
the approval your manager and the Vice President of Finance. Waivers of
conflicts of interest involving executive officers require the approval of
the
Audit Committee or the board of directors.
Business
Gifts and Entertainment
Business
entertainment and business gifts in a commercial setting are intended to
create
goodwill and improve working relationships. Such entertainment or gifts should
not be used to gain an unfair advantage with suppliers or customers. Such
gifts
or entertainment should not be offered, given, provided or accepted by any
Argan
employee or family member of an Argan employee unless it (1) is not a cash
gift,
(2) is consistent with customary business practices, (3) is not of significant
value that would give the appearance of impropriety or that the gift or
entertainment was intended in any way to influence a business relationship
and
(4) does not violate any laws or regulations. Each business unit may have
other
guidelines to put on business entertainment depending on practices appropriate
for that business unit. If you have any questions concerning the appropriateness
of gifts or entertainment, you should contact your manager or the Vice President
of Finance.
Working
with Suppliers and Customers
We
must
maintain the confidence, respect and trust of our customers, partners, suppliers
and government organizations by conducting business responsibly. We must
be
committed to acting ethically, lawfully, truthfully and with integrity in
all
business dealings whether selling or buying or representing Argan in any
other
capacity.
Advertising,
Marketing and Sales Practices
Generally,
statements in advertising, promotional materials and product packaging must
be
fair, factual, complete, capable of being substantiated and may not deceive
or
mislead current or potential customers. Argan’s marketing and sales practices
reflect Argan’s commitment to honest and fair dealings with its current or
potential customers. You may not make false or misleading statements about
products and services of ours or those of competitors in marketing or sales
activities.
Purchasing
Products
Argan
also expects to receive fair and competitive prices and quality services
from
our suppliers. We select suppliers that are best able to meet our needs based
on
such factors as quality, value, best or lowest price, technical excellence,
service reputation and production capacity.
Argan
does not condone reciprocity with suppliers or customers. The materials we
require are purchased solely on their merits, just as the products we sell
are
sold solely on their merits. Personal or family relationships should not
influence purchasing or sales decisions.
Dealings
with Competitors
Argan
believes that a competitive economy is essential to the public interest,
to the
interests of the business community in general, and to Argan specifically.
Argan's policy is to comply with the laws of competition in all jurisdictions
in
which we operate.
All
employees must carry out the policy of Argan to compete vigorously and legally
in all areas of its business operations. No employee of Argan has authority
to
engage in any conduct inconsistent with the laws of competition or to authorize,
direct or condone such conduct by any other person. For example, Argan employees
shall not:
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Agree
on or even discuss with competitors any matter involved in competition
between Argan and the competitor (such as sales price, credit terms,
marketing strategies, market shares or sales policies) except in
those
instances where there is a bona fide purchase from or sale to a
competitor
or bona fide credit checks for commercially reasonable purposes.
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Agree
with a competitor to restrict competition by fixing prices, allocating
customers or territories or any other means.
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Agree
with a supplier or customer on the minimum price at which a product
will
be resold.
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Sell
a product below cost with the intent to harm a
competitor.
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Violations
and Waivers
The
Audit
Committee or Board of Directors shall determine, or designate appropriate
persons to determine, remedial actions to be taken in the event of a violation
of the Code of Conduct. Such actions shall be reasonably designed to deter
wrongdoing and promote accountability for adherence to the Code of Conduct.
The
Audit Committee or Board of Directors has full and discretionary authority
to
approve any amendment to or waiver from this Code of Conduct; any such amendment
or waiver shall be promptly disclosed as required by applicable law or
regulation.
Administration
The
overall administration of our Code of Conduct rests with the Argan Corporate
Headquarters in Rockville, MD. Argan will not tolerate any threats or acts
of
retaliation against an employee for any report made in good faith. Employees'
reports of Code of Conduct violations will be kept confidential to the extent
permitted by law and our ability to address specific concerns. Anonymous
reports
should supply detailed information to allow us to investigate and address
the
concern. In some instances, employees' names will be needed for us to properly
investigate the matter. Some investigations may not allow for complete
anonymity.
Acknowledgement
We
ask
that employees annually to acknowledge their commitment to the Code of Conduct.
Your signature acknowledges that you have read and understand the Code of
Conduct.
Training
You
may
be required to take a training course covering the Code of Conduct and may
be
required to take refresher courses from time to time.
Non-retaliation
Under
no
circumstances will you be subject to any disciplinary or retaliatory action
for
reporting a possible violation of the Code of Conduct or applicable law or
for
cooperating in any investigation of a possible violation. However, knowingly
false or malicious reports will not be tolerated and anyone filing such reports
will be subject to appropriate disciplinary action.
Waivers
Any
waiver of this Code of Conduct for directors or executive officers may be
made
only by the Audit Committee or the board of directors. Requests for waivers
from
other employees should be addressed to your manager and the Vice President
of
Finance.
Investigations
Supervisors
and managers should be accessible to employees who wish to report any unlawful
or unethical conduct that violates this Code of Conduct. Any person receiving
an
employee report of a violation of this Code of Conduct should notify the
Vice
President of Finance or the Argan Corporate Headquarters, of the report.
Argan
will investigate all such employee reports. You are responsible for providing
truthful information and cooperating fully in any investigation.
In
connection with any investigation, employees must not (1) interfere with
the
investigation, such as by providing false, misleading or incomplete information,
concealing information or encouraging others not to contribute to an
investigation or (2) destroy or alter any information relevant to the
investigation.
Remediation
Violation
of our Code of Conduct is a serious matter and may in some circumstances
subject
Argan or the employee involved to civil liability or even criminal
prosecution.
Employees
who violate our Code of Conduct may be disciplined. Disciplinary action will
be
determined by the applicable business unit management, the Vice President
of
Finance, the Argan Corporate Headquarters and/or the Audit Committee, based
on
the circumstances involved. Disciplinary action can include severe consequences,
such as termination of employment, suspension from employment without pay,
demotion, transfer, withholding of promotion and requiring reimbursement
of
damages caused.
Questions
about our Code of Conduct should be directed to your immediate supervisor,
manager, Vice President of Finance, the Argan Corporate Headquarters or the
anonymous Hot Line.
Argan
Corporate Headquarters:
Argan,
Inc.
One
Church Street
Suite
401
(301)
315-0027
Anonymous
Hot line phone number: