We have established an audit committee in accordance with the Nasdaq Listing Rules, which reviews our internal accounting procedures and considers and reports to our board of directors with respect to other auditing and accounting matters, including the selection of our independent auditors, the scope of annual audits, fees to be paid to our independent auditors and the performance of our independent auditors. The members of our audit committee are Charlie Y. Shi, Hanhui(Sam) Sun and Hui(Tom) Zhang, all of whom are our independent directors.
|Xiaolong Li||Independent Director|
|Xiaoxin Chen||Independent Director|
|Hope Ni||Independent Director|
|Nomination Committee & Compensation Committee|
We have established a nominations committee, which identifies individuals qualified to become directors and recommends director nominees to be approved by our board. The members of our nominations committee are Xiaoxin Chen, Xiaolong Li, both of whom are our independent directors.
|Xiaolong Li||Independent Director|
|Xiaoxin Chen||Independent Director|
The Board of Directors of KongZhong Corporation (with its subsidiaries, the "Company") has adopted this code of ethics (this "Code") to:
All directors, officers and employees of the Company are expected to be familiar with the Code and to adhere to those principles and procedures set forth in the Code which apply to them.
For purposes of this Code, the "Code of Ethics Contact Person" will be different for various employees. The Code of Ethics Contact Person for employees other then the executive officers of the Company is Nick Yang and the Code of Ethics Contact Person for executive officers of the Company is Yongqiang Qian. Both Nick Yang and Yongqiang Qian have address at 8/F, Tower A, Yuetan Building, No. 2 Yuetan North Street, Beijing, China 100045.
From time to time, the Company may waive some provisions of this Code. Any waiver of the Code for executive officers or directors of the Company may be made only by the Board of Directors and must be disclosed as required by SEC or Nasdaq rules. Any waiver for other employees may be made only by the Company's Chief Executive Officer or President.
I. Honest and Candid Conduct
Each director, officer and employee owes a duty to the Company to act with integrity. Integrity requires, among other things, being honest and candid. Deceit and subordination of principle are inconsistent with integrity.
Each director, officer and employee must:
II. Conflicts of Interest
A "conflict of interest" occurs when an individual's private interest interferes or appears to interfere with the interests of the Company. A conflict of interest 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. For example, a conflict of interest would arise if a director, officer or employee, or a member or his or her family, receives improper personal benefits as a result of his or her position in the Company. Any material transaction or relationship that could reasonably be expected to give rise to a conflict of interest should be discussed with the Code of Ethics Contact Person.
Service to the Company should never be subordinated to personal gain and advantage. Conflicts of interest should, wherever possible, be avoided.
In particular, clear conflict of interest situations involving directors, executive officers and other employees who occupy supervisory positions or who have discretionary authority in dealing with any third party specified below may include the following:
Such situations, if material, should always be discussed with the Code of Ethics Contact Person.
Anything that would present a conflict for a director, officer or employee would likely also present a conflict if it is related to a member of his or her family.
Each director, officer or employee involved in the Company's disclosure process, including the Chief Executive Officer, the Chief Financial Officer and the Controller (the "Senior Financial Officers"), is required to be familiar with and comply with the Company's disclosure controls and procedures and internal control over financial reporting, to the extent relevant to his or her area of responsibility, so that the Company's public reports and documents filed with the SEC comply in all material respects with the applicable federal securities laws and SEC rules. In addition, each such person having direct or supervisory authority regarding these SEC filings or the Company's other public communications concerning its general business, results, financial condition and prospects should, to the extent appropriate within his or her area of responsibility, consult with other Company officers and employees and take other appropriate steps regarding these disclosures with the goal of making full, fair, accurate, timely and understandable disclosure.
Each director, officer or employee who is involved in the Company's disclosure process, including without limitation the Senior Financial Officers, must:
It is the Company's policy to comply with all applicable laws, rules and regulations. It is the personal responsibility of each employee, officer and director to adhere to the standards and restrictions imposed by those laws, rules and regulations.
It is against company policy and in many circumstances illegal for a director, officer or employee to profit from undisclosed information relating to the Company or any other company. Any director, officer or employee may not purchase or sell any of the Company's securities while in possession of material nonpublic information relating to the Company. Also, any director, officer or employee may not purchase or sell securities of any other company while in possession of any material nonpublic information relating to that company.
Any director, officer or employee who is uncertain about the legal rules involving a purchase or sale of any Company securities or any securities in companies that he or she is familiar with by virtue of his or her work for the Company, should consult with the Company's securities law counsel before making any such purchase or sale.
V. Reporting and Accountability
The Audit Committee is responsible for applying this Code to specific situations in which questions are presented to it and has the authority to interpret this Code in any particular situation. Any director, officer or employee who becomes aware of any existing or potential violation of this Code is required to notify the Code of Ethics Contact Person promptly. Failure to do so is itself a violation of this Code.
Any questions relating to how this Code should be interpreted or applied should be addressed to the Code of Ethics Contact Person. A director, officer or employee who is unsure of whether a situation violates this Code should discuss the situation with the Code of Ethics Contact Person to prevent possible misunderstandings and embarrassment at a later date.
Each director, officer or employee must:
The Audit Committee shall take all action they consider appropriate to investigate any violations reported to them. If a violation has occurred, the Company will take such disciplinary or preventive action as it deems appropriate, after consultation with the Audit Committee, in the case of a director or executive officer.
Upon being notified that a violation has occurred, the Board of Directors will take such disciplinary or preventive action as it deems appropriate, up to and including dismissal or, in the event of criminal or other serious violations of law, notification of appropriate governmental authorities.
VI. Corporate Opportunities
Employees, officers and directors owe a duty to the Company to advance the Company's business interests when the opportunity to do so arises. Employees, officers and directors are prohibited from taking (or directing to a third party) a business opportunity that is discovered through the use of corporate property, information or position, unless the Company has already been offered the opportunity and turned it down. More generally, employees, officers and directors are prohibited from using corporate property, information or position for personal gain and from competing with the Company.
Sometimes the line between personal and Company benefits is difficult to draw, and sometimes there are both personal and Company benefits in certain activities. Employees, officers and directors who intend to make use of Company property or services in a manner not solely for the benefit of the Company should consult beforehand with the Code of Ethics Contact Person.
In carrying out the Company's business, employees, officers and directors often learn confidential or proprietary information about the Company, its customers, suppliers, or joint venture parties. Employees, officers and directors must maintain the confidentiality of all information so entrusted to them, except when disclosure is authorized or legally mandated. Confidential or proprietary information of our Company, and of other companies, includes any non-public information that would be harmful to the relevant company or useful or helpful to competitors if disclosed.
VIII. Fair Dealing
We have a history of succeeding through honest business competition. We do not seek competitive advantages through illegal or unethical business practices. Each employee, officer and director should endeavor to deal fairly with the Company's customers, service providers, suppliers, competitors and employees. No employee, officer or director should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any unfair dealing practice.
IX. Protection and Proper Use of Company Assets
All employees, officers and directors should protect the Company's assets and ensure their efficient use. All Company assets should be used only for legitimate business purposes.
To notify our Audit Committee of any concerns regarding KongZhong's accounting practices, internal controls, financial statements or auditing matters you may mail your concern to the following address:
33/F, Tengda Plaza,
No. 168 Xizhimenwai Street,
Beijing, 100044, China
Send email to:
You may report your concerns anonymously; however the Audit Committee encourages you to provide your name and contact information so that we may contact you directly if necessary during an investigation and respond to your concern.
Shareholders and other interested parties may also communicate with individual independent directors and committee chairs by writing to them at the above mailing address, in care of the Office of the General Counsel.
Under procedures established by KongZhong's independent directors, each letter and e-mail sent in accordance with the above instructions is reviewed by the Legal Department and, unless such communications fall within one of the categories listed below, distributed to all of the independent directors or to individual directors, as appropriate, with copies to the Office of the Chairman. The directors also receive a quarterly report that summarizes all director communications received during the most recent quarter.
The types of communications that are not forwarded to the independent directors are as follows: