Trading Policy
Adopted March 18, 2005
Policy Statement
All, directors, officers and employees (collectively,
“Insiders”) of Solomon Technologies, Inc. (the
“Company”) are prohibited from buying and selling
securities of the Company and advising others who may buy
or sell securities of the Company, when such Insiders are
in possession of material, nonpublic information regarding
the Company or any of its subsidiaries; provided, however,
Insiders may purchase or sell securities of the Company regardless
of the information they possess at the time of the transaction
if it is made pursuant to a pre-arranged trading plan executed
by the Insider when not in possession of material, nonpublic
information regarding the Company pursuant to Rule 10b5-1(c)
under the Securities Exchange Act of 1934, as amended (“Exchange
Act”).
General
The U.S. federal securities laws prohibit
(i) trading in securities on the basis of material, non-public
information and (ii) revealing such information to others
who then act upon it. These restrictions apply to all transactions
in publicly traded securities in all markets (including U.S.
and foreign markets). They apply to transactions effected,
directly or indirectly, by you or any member of your immediate
family or household. They also apply to transactions through
accounts over which you or a member of your immediate family
or household has trading discretion or influence. There are
severe criminal penalties for violations of these rules.
What is “Inside” Information?
“Inside” information includes
anything you become aware of because of your special relationship
with the company as an officer, director or employee of the
Company that has not been disclosed to the public. The information
may be about the Company or any of its subsidiaries or other
affiliates. It may also include information you learn about
another company, for example, companies that are current or
prospective customers or suppliers to the Company or with
which the Company may be in negotiations regarding a potential
transaction.
What is “Material” Information?
Trading in securities while in possession
of “inside” information is not a basis for liability
unless the information is “material.” Information
is material if there is a substantial likelihood that a reasonable
investor would think such information important in deciding
whether to buy, sell or hold stock, or if it could affect
the market price of the stock. Either positive or negative
information may be material. Information can be material even
if it relates to future speculative or contingent events and
even if it is significant only when considered in combination
with publicly available information. If you are unsure whether
information is material, assume it is material.
Although there is no precise, generally accepted
definition of materiality, some examples of material information
include, but are not limited to:
· Earnings or sales results or forecasts
for the quarter or the year;
· Company financial problems;
· estimates of future earnings or losses;
· events that could result in restating financial information;
· a proposed acquisition or sale;
· significant disputes with major suppliers or customers;
· public or private offerings of debt or common stock;
· beginning or settling a major lawsuit;
· hanges in dividend policies;
· declaring a stock split;
· a stock or bond offering; or
· winning or losing a large contract.
“Inside” information could be
material because of its expected effect on the price of the
Company’s stock, the stock of another company not related
to the Company, or the stock of several such companies. In
addition, the resulting prohibition against the misuse of
“inside” information includes not only restrictions
on trading in the Company stock but also restrictions on trading
in the stock of other companies affected by the “inside”
information.
What is “Non-public”
Information?
In order for information to qualify as “inside”
information, it must not only be “material,” it
must also be “non-public.” Non-public information
is information that has not yet been made public by the Company.
Information only becomes public when the Company makes an
official announcement (i.e., in a publicly accessible conference
call, a press release or in filings made with the Securities
and Exchange Commission (“SEC”)), and people have
had an opportunity to see or hear it. The circulation of rumors
or “talks on the street,” even if accurate, widespread
and reported in the media, does not constitute public disclosure.
Similarly, disclosing only part of the information does not
constitute public dissemination. So long as any material portion
of the information has yet to be publicly disclosed, the information
is deemed “non-public” and may not be misused.
Therefore, you should not buy or sell stocks or other securities
before the public announcement of material information.
The Company does not consider quarterly and
annual earning results “public” until the third
business day after a press release has been issued. Similarly,
other material information will not be considered public until
the third business day after the public release of such information.
Prohibition Against Trading
While
In Possession of Material Non-Public Information
You may not purchase or sell stocks or other
securities of the Company or of any other company when you
are aware of any material, non-public information about the
Company or such other company, no matter how you learned the
information. You also must not “tip” or otherwise
give material, non-public information to anyone, including
people in your immediate family, friends or anyone acting
for you (such as a stockbroker).
Pre-Clearance Policy for Trading
While
Not in Possession of Material Non-Public Information
You may not trade at any time without prior
clearance. Before trading in Company stock, you must contact
Peter DeVecchis at (727) 934-8778 to inquire if a restricted
trading period is in effect and to obtain pre-clearance of
the contemplated trade. “Trading” includes not
only purchases and sales of stock, but also acquisitions and
dispositions of equity derivative securities and stock swap
agreements, the exercise of certain options, warrants, puts
and calls, pledges of securities, etc.
Restricted trading periods are periods designated
by the Company as times in which you may not trade in Company
stock regardless of your actual possession or non-possession
of material, non-public information. Exceptions to this prohibition
will be considered for emergency reasons by the Company. These
restricted trading periods are instituted by the Company for
a variety of reasons. One such restricted trading period is
instituted prior to the Company’s release of its quarterly
results. This restricted trading period begins on the 15th
day of the third month of every calendar quarter (March 15,
June 15, September 15 and December 15) and lasts until the
third business day after the Company releases its results
for the completed quarter. No employee may, under any circumstance,
(i) engage in short selling of the Company’s securities
(i.e., selling securities he or she does not own) or (ii)
buy or sell put or call options on the Company’s securities,
whether in the public option markets or otherwise.
If, upon requesting clearance, you are advised
that Company stock may be traded, you may buy or sell the
stock within three (3) business days after clearance is granted,
but only if you are not otherwise in possession of
material, non-public information. If for any reason
the trade is not completed within three (3) business days,
clearance must be obtained again before stock may be traded.
If, upon requesting clearance, you
are advised that Company stock may not be traded, you may
not engage in any trade of any type under any circumstances,
nor may you inform anyone of the restriction. You
may reapply for clearance at a later date when trading restrictions
may no longer be applicable. In sum, it is critical that you
obtain clearance before any trading to prevent insider trading
violations and to avoid even the appearance of an improper
transaction (which could result, for example, when an officer
or director engages in a trade while unaware of a pending
major development).
Whenever clearance is requested, whether
clearance is granted or denied, you will receive a Trade Action
Memorandum in the form of Annex A hereto. You should keep
the Trade Action Memorandum in a safe place.
Pre-Clearance Policy for Rule 10b5-1
Plans
Notwithstanding the prohibition against insider
trading, Rule 10b5-1 under the Exchange Act and the Company’s
policy permit Insiders to trade in Company securities regardless
of their awareness of “inside” information if
the transaction is made pursuant to a pre-arranged trading
plan that was entered into when the Insider was not in possession
of material nonpublic information. You may not implement a
trading plan under Rule 10b5-1 at any time without prior clearance.
Before entering into a trading plan you must contact Peter
W. DeVecchis at (727) 934-8778 to inquire if a restricted
trading period is in effect and to obtain pre-clearance of
the contemplated plan. You may enter into a trading plan only
when you are not in possession of material, non-public information.
Once a trading plan is pre-cleared, trades made pursuant to
the plan will not require additional pre-clearance, but only
if the plan specifies the dates, prices and amounts of the
contemplated trades or establishes a formula for determining
dates, prices and amounts. Whenever you request pre-clearance
for a trading plan you will receive a Trade Action Memorandum
from the Company indicating whether clearance is granted or
denied.
What Are The Penalties for Insider
Trading?
In 1988, Congress passed the Insider Trading
and Securities Fraud Enforcement Act of 1988, providing for
increased criminal penalties for persons engaged in insider
trading. In addition, non-criminal civil actions may be brought
by private individuals or the SEC. The SEC can research any
suspicious trading and does not care if you are trading 10,000
shares or 10 shares. No executive officer, director or employee
is exempt from a possible SEC investigation and penalties
(i.e., jail sentence, return of profits, fines, etc.). A person
can be subject to penalties even if he or she does not personally
benefit from the violation (i.e., if the violation only involved
passing the information to someone else, called a “tippee”).
In addition, a violation of these insider trading restrictions
can be expected to result in serious disciplinary actions
by the Company (i.e., termination).
How Can I Protect Material Non-public
Information?
Material non-public information (and all
other confidential information of the Company) should be communicated
only to those people who need to know it for a legitimate
business purpose and who are authorized to receive the information
in connection with their responsibilities to the Company.
The following practices should be followed
to help prevent the misuse of material non-public information
and other types of confidential information:
Confidential matters should neither be discussed
in the public corridors of our offices, or any other place
where conversations may be overheard by people who do not
have a valid need to know the information, nor should they
be discussed with relatives or social acquaintances.
Always put confidential documents away when
not in use. Do not leave documents containing confidential
information where they may be seen by persons who do not have
a need to know the content of the documents.
Do not give your computer IDs and passwords
to any other person.
Comply with the specific terms of any confidentiality
agreements of which you are aware.
· Message boards and chat rooms have
not been deemed approved vehicles for disclosure by the SEC
and other regulatory trading organizations, so it is imperative
that all Company personnel refrain from posting information
on message boards or chat rooms.
· Any information that
could be considered material news (i.e., news that could be
reasonably interpreted to cause an investor to buy or sell
stock) that is posted on the Internet could trigger a lawsuit.
· A special unit of the SEC monitors online fraud,
and has brought several dozen enforcement cases.
· Employees should be aware that they also should refrain
from posting any information on message boards related to
the Company's peers, partners or competitors, and from participating
in any chat rooms, especially on Company time.
· Employees should think twice before sending or forwarding
an email message containing confidential information to an
address outside the Company.
All requests for information about the Company
should be routed through Peter DeVecchis, to be handled as
appropriate. The SEC’s Regulation FD prohibits selective
disclosure of material non-public information to securities
market professional and investors who may trade on the basis
of such information.
What If I Have Any Questions About
Insider Trading Restrictions?
Insiders of the Company should at all times
avoid even the appearance of impropriety with respect to trading
in Company stock or the securities of any of the companies
with whom the Company or its subsidiaries does business. When
there is any question as to a potential application of insider
trading laws or any other restrictions on insider trading,
or if you know of a suspected violation of those laws or this
policy, please contact Peter DeVecchis at (727) 934-8778.
Solomon Technologies, Inc.
Peter DeVecchis, 727-859-4447
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