CORPORATE GOVERNANCE GUIDELINES
UNIVERSAL TRADING & INVESTMENT CO., INC.
A Massachusetts corporation, incorporated on February 11, 1993.
(As amended on August 1, 2011)
The present Guidelines have been adopted per Board’s directives. The following corporate governance guidelines have been approved and adopted by the Written Consent of the Board for the purpose of establishing the corporate governance policies pursuant to which the Board intends to conduct its oversight of the business of the Company in accordance with its fiduciary responsibilities.
The role of the Board is to oversee the performance of the chief executive officer and other senior management and to assure that the best interests of stockholders are being served. To satisfy this responsibility, the directors are expected to take a proactive approach to their duties and function as active monitors of corporate management. Accordingly, the directors provide oversight in the formulation of the long term strategic, financial and organizational goals of the Company and of the plans designed to achieve those goals. In addition, the Board reviews and approves standards and policies to ensure that the Company is committed to achieving its objectives through the maintenance of the highest standards of responsible conduct and ethics and to assure that management carries out their day-to-day operational duties in a competent and ethical manner.
The Board understands that effective directors act on an informed basis after thorough inquiry and careful review, appropriate in scope to the magnitude of the matter being considered. The directors know their position requires them to ask probing questions of management and outside advisors. The directors also rely on the advice, reports and opinions of management, counsel and expert advisers. In doing so, the Board evaluates the qualifications of those it relies upon for information and advice and also looks to the processes used by managers and advisors in reaching their recommendations. In addition, the Board has the authority to hire outside advisors at the Company’s expense if they feel it is appropriate.
The ad hoc Corporate Governance Committee shall periodically review and approve the Company’s Code of Business Conduct and Ethics, which is applicable to directors or officers, consider questions of possible conflicts of interest of Board members and corporate officers; review actual and potential conflicts of interest (including corporate opportunities) of Board members and corporate officers; and approve or prohibit any involvement of such persons in matters that may involve a conflict of interest or corporate opportunity. Directors may be asked from time to time to leave a Board meeting when the Board is considering a transaction in which the director (or another organization in which the director is a director or officer) has a financial or other interest.
The ad hoc auditors shall review and approve any proposed related party transactions in compliance with the Company’s policies and the securities laws and regulations and must report material related party transactions to the full Board, monitor compliance with the Company’s financial code of ethics and review and approve the Company’s procedures for handling complaints regarding accounting or auditing matters.
The Board should review on an annual basis, in the context of recommending a slate of directors for stockholders subsequent approval, the composition of the Board, including, without limitation, issues of character, judgment, diversity, age, independence, expertise, corporate experience, length of service, understanding of the Company’s business, other commitments (including the number of other boards and committees on which the individual serves) and the like. Selection of new directors requires recommendation of a candidate by the Corporate Governance Committee to the full Board, which has responsibility for naming new members in the event of a vacancy or expansion of the Board between annual meetings of stockholders.
It is the policy of the Board that its ad hoc Corporate Governance Committee consider both recommendations and nominations for candidates to the Board from stockholders so long as such recommendations and nominations comply with the certificate of incorporation and bylaws of the Company and applicable laws, including the securities laws and regulations. Stockholders may recommend director nominees for consideration by the Nominating and Corporate Governance Committee by writing to the Secretary of the Company and providing the information required in the Company’s bylaws.
Following verification of the stockholder status of the person submitting the recommendation, all properly submitted recommendations will be promptly brought to the attention of the ad hoc Corporate Governance Committee. Stockholders who desire to nominate persons directly for election to the Board at the Company’s annual meeting of stockholders must meet the deadlines and other requirements set forth in the Company’s bylaws and the applicable Rules. Any vacancies on the Board occurring between the Company’s annual meetings of stockholders may be filled by persons selected by a majority of the directors then in office, although less than a quorum, or by a sole remaining director, and any director so elected will serve for the remaining term of the class of directors in which the vacancy occurred.
The ad hoc Corporate Governance Committee, in consultation with the full Board, is primarily responsible for executives’ succession planning. Senior management, in consultation with the Nominating and Corporate Governance Committee, shall be responsible for succession plans for other key executives. Succession planning can be critical in the event the key executives should cease to serve for any reason, including resignation or unexpected disability. In addition, however, the Board believes that establishment of a strong management team is the best way to prepare for an unanticipated executive departure.
The Board believes that management speaks for the Company. Individual Board members may, from time to time, meet or otherwise communicate with various constituencies that are involved with the Company, but it is expected that Board members would do this with knowledge of management and, in most instances, only at the request of management.
The Company’s directors should not accept any gift of value that indicates in any manner an intent to influence improperly the normal business relationship between the Company and any client, customer or competitor.
Identification and Assessment of Director Candidates. The Corporate Governance and Nominating Committee (the “Governance Committee”) is responsible for establishing criteria for selecting directors and seeking and assessing individuals for recommendation to the Board as director candidates. In this regard, the Governance Committee has established a policy for identifying and evaluating director nominees and Board membership criteria. The Governance Committee has also established a policy (attached hereto as Exhibit 3) regarding shareholder nominations for director candidates.
Board Size and Composition. The number of directors that constitutes the whole Board will be fixed from time to time by a majority of the directors then in office or by the shareholders at an annual meeting. The ad hoc Governance Committee is responsible for reviewing, on at least an annual basis, the advisability or need for any change in the number of directors or composition of the Board.
Director Election. In accordance with the Company’s by-laws, if none of our stockholders provides the Company notice of an intention to nominate one or more candidates to compete with the Board’s nominees in a director election, or if our stockholders have withdrawn all such nominations by the tenth day before the Company mails its notice of meeting to our stockholders, a nominee must receive more votes cast for than against his or her election or re-election in order to be elected or re-elected to the Board. The Board expects a director to tender his or her resignation if he or she fails to receive the required number of votes for re-election. The Board shall nominate for election or re-election as director only candidates who agree to tender, promptly following the annual meeting at which they are elected or re-elected as director, irrevocable resignations that will be effective upon (i) the failure to receive the required vote at the next annual meeting at which they face re-election and (ii) Board acceptance of such resignation. In addition, the Board shall fill director vacancies and new directorships only with candidates who agree to tender, promptly following their appointment to the Board, the same form of resignation tendered by other directors in accordance with this Board practice.
If an incumbent director fails to receive the required vote for re-election, the ad hoc Corporate Governance will act on an expedited basis to determine whether to accept the director’s resignation and will submit such recommendation for prompt consideration by the Board. The Board expects the director whose resignation is under consideration to abstain from participating in any decision regarding that resignation, except that: If every member of the ad hoc Corporate Governance Committee fails to receive the required vote for re-election, then a majority of the Board shall appoint a Board committee of independent directors for the purpose of considering the tendered resignations and making a recommendation to the Board whether to accept or reject them; and If the number of independent directors who receive the required vote for re-election is three or fewer, all directors may participate in the decisions as to the tendered resignations.
The Corporate Governance and Nominating Committee (or the Special Nominating Committee) and the Board may consider any factors they deem relevant in deciding whether to accept a director’s resignation. The Corporate Governance and Nominating Committee (or the Special Nominating Committee) will make a recommendation and the Board will act on the tendered resignation, and publicly disclose its decision, within 90 days following certification of the stockholder vote. If an incumbent director’s resignation is not accepted by the Board, the director shall continue to serve until the next annual meeting and until his or her successor is duly elected, or his or her earlier resignation or removal. A situation in which no director nominee receives the required vote for re-election would constitute a compelling reason for a Board member to remain in office, as the absence of a Board of Directors would cause significant uncertainty and disruption to the Company.
Service on Other Boards. Each director may serve as a director on the boards of additional public companies, but only to the extent that this additional service does not compromise the director’s ability to devote his or her time and attention to his or her duties to the Company and the Company’s affairs. In no event shall a director serve as a director on the boards of more than three (3) public companies in the case of a director who is the Company’s Chief Executive Officer and more than four (4) public companies in the case of all other directors.
If any of the Company’s directors wish to serve on the board of an additional public company or private business company, prior to accepting such position such director should discuss his or her plans with the Chairman of the Board, the Lead Independent Director or the General Counsel. In addition, in all cases, the General Counsel should have the opportunity to review, among other things, potential conflicts of interest, independence issues and other legal considerations, prior to such position being accepted.
Director Tenure. In connection with each director nomination recommendation, the Governance Committee shall consider the issue of continuing director tenure and take steps as may be appropriate to ensure that the Board maintains an openness to new ideas and a willingness to critically re-examine the status quo. An individual director’s re-nomination is dependent upon such director’s performance evaluation, as well as a suitability review, each to be conducted by the Governance Committee in conjunction with the Chairman of the Board (except, in the case of the Chairman of the Board, by the Governance Committee only).
The Pending Proposed Corporate Actions.
Most of the corporate actions are not publicly available. For the most recent corporate action that is made publicly available, see the link.