Amendment to Annual Report — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K/A Annual Report 13 93K
2: EX-10 Retention Agreement - [Ex-10.24] 5 26K
3: EX-14 Code of Ethics 7 30K
4: EX-23 Consent of Grant Thornton LLP 1 11K
5: EX-31 Certification of Edward G. Newman 2± 10K
7: EX-31 Certification of Steven A. Newman 2± 10K
6: EX-31 Certification of Thomas D. Davis 2± 10K
8: EX-32 Cert. of Messrs. E. Newman, Davis & S. Newman 1 8K
EX-14 — Code of Ethics
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Exhibit 14
XYBERNAUT CORPORATION
Code of Business Conduct and Ethics
Our Company's reputation for honesty and integrity is the sum of the personal
reputations of our directors, officers and employees. To protect this reputation
and to promote compliance with laws, regulations and Company policies, the Board
of Directors has adopted this Code of Business Conduct and Ethics. This Code is
only one aspect of our commitment. You must be familiar with and comply with all
Company policies.
This Code states the basic standards of ethics and conduct to which all of our
directors, officers and employees are held. These standards are designed to
deter wrongdoing and promote honest and ethical conduct, but will not cover all
situations. There may be times when the law or local practice restrict your
conduct to a greater extent than this Code. In these cases you must comply with
the law or local custom and practice, whichever is more restrictive.
Those who violate the standards stated in this Code will be subject to
disciplinary action.
1. Scope
You are subject to this Code if you are a director, officer or
employee of the Company or any of its subsidiaries (or controlled
entities).
2. Honest and Ethical Conduct
We as a Company require honest and ethical conduct from everyone
subject to this Code. Each of you has a responsibility to all other
directors, officers, employees and to our Company itself, to act
responsibly, in good faith and with competence and diligence. You
are responsible to meet the Company's ethical and legal standards
without misrepresenting material facts or allowing your independent
judgment to be subordinated or compromised.
3. Compliance with Laws, Rules and Regulations
You are required to comply with both the letter and spirit of all
applicable governmental laws, rules and regulations. Although you
are not expected to know the details of all applicable laws, rules
and regulations, you are expected to seek advice from our Company's
General Counsel if you have a question about any applicable laws,
rules and regulations or if you are unsure whether certain conduct
is illegal or unethical.
4. Conflict of Interest
You must handle any actual or apparent conflict of interest in an
ethical manner. Conflicts of interest are prohibited by Company
policy and exist when a person's private interest interferes in any
way with the interest of our Company. For example, taking actions or
having interests that interfere with your ability to effectively and
objectively perform your work for our Company is a conflict of
interest. Conflicts of interest may also arise if you receive, or a
member of your family receives, an improper personal benefit as a
result of your position with the Company.
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Company policy prohibits conflicts of interest except under
guidelines approved by the Board of Directors. The following
standards apply to common situations where potential conflicts of
interest may arise.
A. Gifts and Entertainment
Personal gifts and entertainment offered by persons
doing business with our Company may be accepted, when
offered in the ordinary and normal course of the
business relationship. However, the frequency and cost
of any gifts or entertainment may not be so excessive
that your ability to exercise independent judgment on
behalf of our Company is or may appear to be
compromised. Cash in any form is inappropriate and
should not be accepted.
B. Financial Interests In Other Organizations
The determination whether any outside investment,
financial arrangement or other interest in another
organization is improper depends on the facts and
circumstances of each case. Your ownership of an
interest in another organization may be inappropriate if
the other organization has a material business
relationship with, or is a direct competitor of, our
Company and your financial interest is of such a size
that your ability to exercise independent judgment on
behalf of our Company is or may appear to be
compromised. As a general rule, a passive investment
would not likely be considered improper if it: (1) is in
publicly traded shares; (2) represents less than 1% of
the outstanding equity of the organization in question;
and (3) represents less than 5% of your net worth. Other
interests also may not be improper, depending on the
circumstances.
C. Outside Business Activities
The determination of whether any outside position an
employee may hold is improper will depend on the facts
and circumstances of each case. Your involvement in
trade associations, professional societies, and
charitable and similar organizations will not normally
be viewed as improper. However, if those activities are
likely to take substantial time from or otherwise
conflict with your responsibilities to our Company, you
should obtain prior approval from your supervisor and
the Human Resources Department. Other outside
associations or activities in which you may be involved
are likely to be viewed improper only if they would
interfere with your ability to devote proper time and
attention to your responsibilities to our Company or if
your involvement is with another Company with which our
Company does business or competes. For a director,
employment or affiliation with a Company with which our
Company does business or competes must be fully
disclosed to our Company's Board of Directors and must
satisfy any other standards established by applicable
law, rule (including rules of the Nasdaq stock exchange)
or regulation and any other corporate governance
guidelines that our Company may establish.
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5. Corporate Opportunities
You are prohibited from personally utilizing a corporate opportunity
unless the Board of Directors has declined to pursue that
opportunity. You may not use corporate property, information, or
position for personal gain, or to compete with our Company. You owe
a duty to our Company to advance its legitimate interests whenever
the opportunity to do so arises.
6. Fair Dealing
You should endeavor to deal fairly with our Company's suppliers,
customers, competitors and employees and with other persons with
whom our Company does business. You should not take unfair advantage
of anyone through manipulation, concealment, abuse of privileged
information, misrepresentation of material facts, or any other
unfair-dealing practice.
7. Public Disclosures
It is our Company's policy to provide full, fair, accurate, timely,
and understandable disclosure in all reports and documents that we
file with, or submit to, the Securities and Exchange Commission and
in all other public communications made by our Company.
8. Confidentiality
You should maintain the confidentiality of all confidential
information entrusted to you by our Company or by persons with whom
the Company does business, except when disclosure is authorized or
legally mandated. Confidential information includes all non-public
information that might be used by our competitors, or harmful to,
our Company or persons with whom our Company does business, if
disclosed.
9. Insider Trading
If you have access to material, non-public information concerning
our Company, you are not permitted to use or share that information
for stock trading purposes or any purpose other than to conduct our
Company's business. The prohibition on insider trading applies not
only to our Company's securities, but also to securities of other
companies if you learn of material, non-public information about
these companies in the course of your duties to the Company.
Violations of this prohibition against "insider trading" may subject
you to criminal or civil liability, in addition to disciplinary
action by our Company.
10. Protection and Proper Use of Company Assets
You are responsible to protect our Company's assets and promote
their efficient use. Theft, carelessness and waste have a direct
impact on the profitability of the Company. Employees are obligated
to protect the Company's assets including 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 marketing ideas,
designs, databases, records, salary information and any unpublished
financial data and reports. Unauthorized use or distribution of this
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information is a violation of Company policy and could also be
illegal and result in civil or criminal penalties.
11. Interpretations and Waivers of the Code of Business Conduct and
Ethics
If you are unsure whether a particular activity or relationship is
improper under this Code or requires a waiver of this Code, you
should disclose it to our Company's General Counsel, Chief Executive
Officer or President (or the Board of Directors or Audit Committee
if you are a director), who will first make a determination whether
a waiver of this Code is required and second, if required, whether a
waiver will be granted. You may be required to agree to conditions
before a waiver or a continuing waiver is granted. However, any
waiver of this Code for an executive officer or director may only be
made by the Company's Board of Directors (or the Nominating
Committee of the Board of Directors) and will promptly be disclosed
to the extent required by applicable law, rule (including any rule
of the Nasdaq stock exchange) or regulation.
12. Reporting any Illegal or Unethical Behavior
Any employee, including any supervisor, who receives a report of
unethical or illegal behavior from a subordinate, should promptly
report such violation of applicable laws, rules, regulations or this
Code to a superior, our Company's General Counsel, Chief Executive
Officer or President (or the Board of Directors or Audit Committee
if you are a director). Any report or allegation of a violation of
applicable laws, rules, regulations or this Code need not be signed
and may be sent anonymously. All reports of violations of this Code,
including those sent anonymously, will be promptly investigated and,
if found to be credible and accurate, acted upon in a timely manner.
If any report of wrongdoing relates to accounting or financial
reporting matters, such report must be provided to a superior, our
Company's General Counsel, Chief Executive Officer or President (or
the Board of Directors or Audit Committee if you are a director). It
is the Company's policy not to allow actual or threatened
retaliation, harassment or discrimination due to reports of
misconduct by others made in good faith by employees. Employees are
required to cooperate in internal investigations of misconduct.
13. Compliance Standards and Procedures
Our Company wants to promote ethical behavior. This Code is intended
as a statement of basic principles and standards and does not
include specific rules that apply to every situation. Its contents
have to be viewed within the framework of our Company's other
policies, practices, instructions and requirements of the law. This
Code is in addition to other policies, practices or instructions of
our Company that must be observed. Moreover, the absence of a
specific corporate policy, practice or instruction covering a
particular situation does not relieve you of the responsibility for
exercising the highest ethical standards applicable to the
circumstances.
In some situations, it is difficult to know right from wrong.
Because this Code does not anticipate every situation that will
arise, it is important that each of you approach a new question or
problem in a deliberate fashion:
(a) Determine if you know all the facts.
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(b) Identify exactly what it is that concerns you.
(c) Discuss the problem with a supervisor if you are a
corporate employee or the Company's General Counsel if
you are an officer or director. The Human Resources
Department is always available to discuss any ethical
issues that you may have.
(d) Seek guidance before taking any action that you believe
may be unethical or dishonest.
You may also submit any questions that you may have relating to the
propriety of a situation in writing to our Company's General
Counsel, who will review the situation and provide you with advice
as to the course of action that you should take. If your concern
relates to the Company's General Counsel, you may submit your
concern in writing to the Chief Executive Officer or President of
the Company. The mailing address for each of these individuals is
included at the end of this Code.
You will be governed by the following compliance standards:
|X| You are personally responsible for your own conduct and
for complying with all provisions of the Code and for
properly reporting known or suspected violations;
|X| If you are a supervisor, director or officer, you must
use your best efforts to ensure that employees
understand and comply with this Code;
|X| No one has the authority or right to order, request or
even influence you to violate this Code or the law. A
request or order from another person will not be an
excuse for your violation of this Code;
|X| Any attempt by you to induce another director, officer
or employee of our Company to violate this Code, whether
successful or not, is itself a violation of this Code
and may be a violation of law;
|X| Any retaliation or threat of retaliation against any
director, officer or employee of our Company for
refusing to violate this Code, or for reporting in good
faith the violation or suspected violation of this Code,
is itself a violation of this Code and may be a
violation of law; and
|X| Our Company expects that every reported violation of
this Code will be investigated.
Violation of any of the standards contained in this Code, or in any other
policy, practice or instruction of our Company, can result in disciplinary
actions, including dismissal and civil or criminal action against the violator.
This Code should not be construed as a contract of employment and does not
change any person's status as an at-will employee.
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This Code is for the benefit of our Company, and no other person is entitled to
enforce this Code. This Code does not, and should not be construed to, create
any private cause of action or remedy in any other person for a violation of the
Code.
The names, addresses, telephone numbers, facsimile numbers and e-mail addresses
of the Chief Executive Officer, President and General Counsel of our Company are
set forth below:
[Enlarge/Download Table]
General Counsel (outside): Chief Executive Officer: President:
Martin Eric Weisberg, Esq. Mr. Edward G. Newman Dr. Steven A. Newman
Jenkens & Gilchrist Parker Chapin LLP 12701 Fair Lakes Circle 12701 Fair Lakes Circle
The Chrysler Building Fairfax, Virginia 22033 Fairfax, Virginia 22033
405 Lexington Avenue (703) 631-6925 (703) 631-6925
New York, New York 10174 (703) 631-7070 (703) 222-7660
(212) 704-6050 enewman@xybernaut.com snewman@xybernaut.com
(212) 704-6157
mweisberg@jenkens.com
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STATEMENT OF ACKNOWLEDGMENT
You are being furnished two copies of this Code of Business Conduct and Ethics.
To confirm that you have read and understand it, please sign one copy below and
return it to Human Resources.
I have read and I understand and I will observe the requirements of this Code of
Business Conduct and Ethics of Xybernaut Corporation
Name: ________________________________
Print Above
Signature: ___________________________
Date: ________________________________
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