TPI Composites, Inc.
Code of Business Conduct and Ethics
Introduction
Purpose and Scope
The Board of Directors of TPI Composites, Inc., together with its subsidiaries (“TPI”) is committed to promoting strong ethical and legal behavior throughout the Company and has established this Code of Business Conduct and Ethics to aid TPI’s directors, officers and employees (“TPI Personnel”) in making ethical and legal decisions when conducting TPI’s business and performing their day-to-day duties. Achieving a culture of compliance with this Code is paramount to protecting our reputation and good name, and violations of this Code will not be tolerated.
TPI’s Board of Directors and Audit Committee are responsible for administering the Code. The Board of Directors and Audit Committee have delegated day-to-day responsibility for administering and interpreting the Code to a Compliance Officer. Our General Counsel, Stephen Beaver, has been appointed TPI’s Chief Compliance Officer in administering this Code.
TPI expects its personnel to exercise reasonable judgment when conducting TPI’s business. TPI encourages its personnel to refer to this Code frequently to ensure that they are acting within both the letter and the spirit of this Code. TPI also recognizes that this Code may not contain the answer to every situation you may encounter or every concern you may have about conducting TPI’s business ethically and legally. In these situations, or if you otherwise have questions or concerns about this Code, TPI encourages each employee to speak with her or his supervisor, plant General Manager, Controller or HR Manager or, if you are uncomfortable doing that, with Stephen Beaver, our Compliance Officer under this Code.
Contents of this Code
This Code has two sections which follow this Introduction. The first section, “Standards of Conduct,” contains the actual guidelines that our TPI Personnel are expected to adhere to in the conduct of TPI’s business. The second section, “Compliance Procedures,” contains specific information about how this Code functions, including who administers the Code, who can provide guidance under the Code and how violations may be reported, investigated and punished. This section also contains a discussion about waivers of and amendments to this Code.
Other Obligations
TPI Personnel generally have other legal and contractual obligations to TPI. This Code is not intended to reduce or limit the other obligations that you may have to TPI to adhere to TPI’s other employee policies, including those set forth in TPI’s Employee Handbook.
Standards of Conduct
Conflicts of Interest
TPI recognizes and respects the right of its personnel to engage in outside activities which they may deem proper and desirable, provided that these activities do not impair or interfere with the performance of their duties to the Company or their ability to act in TPI’s best interests. In most, if not all, cases this will mean that TPI Personnel must avoid situations that present a potential or actual conflict between their personal interests and TPI’s interests.
A “conflict of interest” occurs when an individual’s personal interest interferes with TPI’s interests. Conflicts of interest may arise in many situations. Each individual’s situation is different and TPI Personnel will have to consider many factors when evaluating his or her own situation. However, some examples of actual or apparent conflicts of interest may include:
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Situations when a TPI director, officer or employee has an outside interest, responsibility or obligation that may make it difficult for him or her to act in TPI’s best interests (e.g. having an ownership stake in a rival business or a personal ownership stake or interest in a company transacting business with TPI).
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Situations when a TPI director, officer or employee, or his or her immediate family members, receive some personal benefit (e.g. money, increased business, etc.), whether improper or not, as a result of his or her position with TPI.
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Situations where a TPI director, officer or employee accepts excessive or lavish gifts from customers or vendors (see Gifts and Invitations to Lunch, Dinner and Other Events described below).
Any material transaction or relationship that reasonably could be expected to give rise to a conflict of interest should be reported promptly to the Compliance Officer. The Compliance Officer may notify the Board of Directors or Audit Committee thereof as he deems appropriate. Actual or potential conflicts of interest involving a director, officer or the Compliance Officer should be disclosed directly to the Chairman of the Audit Committee and/or the Chairman of the Board of Directors.
Compliance with Laws, Rules and Regulations
TPI seeks to conduct its business in compliance with both the letter and the spirit of applicable laws, rules and regulations. TPI Personnel shall not engage in any unlawful activity in conducting TPI’s business or in performing his or her day-to-day company duties, nor shall any director, officer or employee of TPI instruct others to do so. Every employee should report any suspected wrongdoing or violation of law to his or her plant General Manager, Controller, HR Manager or the Compliance Officer, without fear of reprisal.
Protection and Proper Use of TPI’s Property
Loss, theft and misuse of TPI’s property can have a direct impact on TPI’s business and its profitability. TPI Personnel are expected to protect TPI property entrusted to them and to protect TPI’s assets in general. TPI Personnel are also expected to take steps to ensure that TPI property is used only for legitimate business purposes.
Corporate Opportunities
TPI Personnel owe a duty to TPI to advance its legitimate business interests when the opportunity to do so arises. Each employee, officer and director is prohibited from:
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diverting to himself or herself or to others any opportunities that are discovered through the use of TPI’s property or information or as a result of her or his position with TPI,
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using TPI’s property or information or her or his position for improper personal gain, or
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competing with TPI.
Confidentiality
Confidential information generated and gathered in TPI’s business plays a vital role in TPI’s business, prospects and ability to compete. “Confidential information” includes all non‑public information that might be of use to competitors or harmful to the Company or its customers if disclosed. For purposes of this Code, TPI Personnel should also assume that TPI’s Confidential Information includes ANY information about the Company that it has not disclosed publicly in the form of news releases or on its website. TPI Personnel may not disclose or distribute TPI’s Confidential Information, except when such disclosure is authorized by TPI or is required by applicable law, rule or regulation or pursuant to an applicable legal proceeding. TPI Personnel shall use Confidential Information solely for legitimate Company purposes. TPI Personnel must return all of TPI’s Confidential Information and/or other proprietary information in their possession to TPI when they cease to be employed by or to otherwise serve TPI.
Fair Dealing
Competing vigorously, yet lawfully, with competitors and establishing advantageous, but fair, business relationships with customers and suppliers is a part of the foundation for long-term success. However, unlawful and unethical conduct, which may lead to short-term gains, may damage a company’s reputation and long-term business prospects. Accordingly, it is TPI’s policy that directors, officers and employees must deal ethically and lawfully with TPI’s customers, suppliers, competitors and employees in all business dealings on TPI’s behalf. TPI Personnel shall not take unfair advantage of another person in business dealings on TPI’s behalf through the abuse of privileged or confidential information or through improper manipulation, concealment or misrepresentation of material facts.
Gifts
Accepting gifts of excessive value from customers or vendors can create potential conflicts of interest or the appearance of conflicts of interests for our officers and employees. For this reason, TPI has certain rules that apply to the acceptance of gifts. TPI Personnel shall not solicit gifts from our customers or vendors, and TPI Personnel should discourage our customers and vendors from giving TPI Personnel gifts of significant value. If gifts are offered in the context of TPI’s customer or vendor relationships and it would be discourteous to refuse the gift, TPI’s employees may accept such gifts subject to the following: Officers and employees may retain gifts having a nominal value (under $150). (See also Invitations to Lunch, Dinner and Other Events, as described below.) For gifts having more than nominal value (over $150), the officer or employee may either give the gift to the plant General Manager or HR Manager to be raffled or auctioned off to employees at the next employee party, or the officer or employee may estimate the fair market value of the gift and contribute that amount to the plant General Manager or HR Manager for the employees’ party fund. Officers and employees should report all gifts over $150 to the plant HR Manager, the plant General Manager, or the Compliance Officer, as well as the disposition of the gift.
Invitations to Lunch, Dinner and Other Events
TPI’s Gift Policy does not prevent TPI Personnel from accepting invitations from customers or vendors to lunches, dinners or other events (golf outings, sporting events, shows or other similar events) provided that they are not solicited, such occasions are infrequent and that they focus on relationship building with TPI’s customers and vendors. Thus, it is important that the customer or vendor also be present at the event. If a customer or vendor simply gives or buys an officer or employee tickets to an event but does not attend the event, then these tickets should be treated as a gift under TPI’s Gift Policy, as discussed above. Any invitations to events that have a value over $150 per person should be approved in advance by the plant HR manager, the General Manager, or the Compliance Officer.
Accuracy of Records
The integrity, reliability and accuracy in all material respects of TPI’s books, records and financial statements is fundamental to TPI’s continued and future business success. TPI Personnel shall not cause TPI to enter into a transaction with the intent to document or record it in a deceptive or unlawful manner. In addition, TPI Personnel shall not create any false or artificial documentation or book entry for any transaction entered into by TPI. Similarly, officers and employees who have responsibility for accounting and financial reporting matters have a responsibility to accurately record all funds, assets and transactions on TPI’s books and records.
Political Contributions
TPI Personnel may choose on their own accord to make personal contributions to political campaigns, but should not represent that he or she is making any such contribution on TPI’s behalf. Business contributions to political campaigns are prohibited by U.S. federal, state and local law. Similar restrictions on political contributions may apply in other countries. Directors, officers and employees may not use any of TPI’s funds for political contributions of any kind to any political candidate or holder of any national, state or local government office. Specific questions should be directed to the Compliance Officer.
Entertaining or Doing Business with the United States and/or Foreign Governments
Giving anything of value to a government employee is strictly regulated and in many cases prohibited by law. TPI Personnel are expected to comply with all U.S. federal, state and local laws, as well as foreign government laws, governing the acceptance of business courtesies or payments of any kind. TPI Personnel SHOULD NOT, under any circumstances, provide or pay for any meals, refreshments, travel or lodging expenses, or give anything of value to any U.S. federal, state or local government employees, or to the government employees of other countries. Nor shall TPI Personnel contribute corporate funds to any charitable organizations at the request or direction of any government employee in the United States or in other countries.
Quality of Public Disclosures
TPI’s senior officers and employees responsible for public filings and disclosures have primary responsibility for TPI’s public disclosure. TPI is committed to providing its shareholders with complete and accurate information about its financial condition and the results of its operations as required by the securities laws of the United States and, if applicable, other foreign jurisdictions. It is TPI’s policy that the reports and documents it files with or submits to the Securities and Exchange Commission, and its earnings releases and similar public communications made by TPI, include fair, timely and understandable disclosure. Officers and employees who are responsible for these filings and disclosures, including TPI’s principal executive, financial and accounting officers, must use reasonable judgment and perform their responsibilities honestly, ethically and objectively in order to ensure that this disclosure policy is fulfilled.
Compliance Procedures
Communication of Code
All TPI officers and employees will be required to sign and acknowledge their receipt and understanding of the Code. Updates of the Code will be provided from time to time. A copy of the Code is also available to all officers and employees by requesting one from the human resources department or from the Compliance Officer. TPI may also maintain a copy of the Code on its website at www.tpicomposites.com.
Monitoring Compliance and Disciplinary Action
TPI’s management, under the supervision of its Board of Directors and Audit Committee, shall take reasonable steps from time to time to (i) monitor compliance with the Code, and (ii) when appropriate, impose and enforce appropriate disciplinary measures for violations of the Code.
Disciplinary measures for violations of the Code may include, but are not limited to, counseling, oral or written reprimands, warnings, probation or suspension with or without pay, demotions, reductions in salary, termination of employment or service and restitution.
TPI’s management shall periodically report to the Board of Directors and Audit Committee thereof on these compliance efforts including, without limitation, periodic reporting of alleged violations of the Code and the actions taken with respect to any such violation.
Reporting Concerns/Receiving Advice
Communication Channels
Be Proactive. Every employee is encouraged to act proactively by asking questions, seeking guidance and reporting suspected violations of the Code and other policies and procedures of TPI, as well as any violation or suspected violation of applicable law, rule or regulation arising in the conduct of business or occurring on TPI’s property. If any employee believes that actions have taken place, may be taking place, or are about to take place that violate or would violate the Code, he or she is obligated to bring the matter to the attention of TPI.
Seeking Guidance. The best starting point for an officer or employee seeking advice on ethics‑related issues or reporting potential violations of the Code will usually be the plant General Manager, Controller or HR Manager. However, if the conduct in question involves his or her plant management, if the employee has reported the conduct in question to his or her plant management and does not believe that it has been dealt with properly, or if the officer or employee does not feel that he or she can discuss the matter with his or her plant management, the employee may raise the matter with the Compliance Officer.
Communication Alternatives. Any officer or employee may communicate with the Compliance Officer by any of the following methods:
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In writing (which may be done anonymously as set forth below under “Reporting; Anonymity; Retaliation”), addressed to the Compliance Officer by U.S. mail to Stephen Beaver, General Counsel, TPI Composites, Inc., 8501 North Scottsdale Road, Gainey Center II, Suite 280, Scottsdale, AZ 85253;
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By phoning the employee feedback line (the “Feedback Line”) which we have established for receipt of questions and reports of potential violations of the Code. The Feedback Line may be reached at (480) 222‑7769 and calls may be made anonymously as set forth below under “Reporting; Anonymity; Retaliation”.
Reporting Accounting and Similar Concerns. Any concerns or questions regarding potential violations of the Code, any applicable law, or rules or regulations involving accounting, internal accounting controls or auditing matters may also be directed to the Audit Committee. Officers and employees may communicate with the Audit Committee:
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In writing to: Jack Henry, Chairman of Audit Committee, TPI Composites, Inc., 8501 North Scottsdale Road, Gainey Center II, Suite 280, Scottsdale, AZ 85253, or
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By phoning the Feedback Line.
Officers and employees may use the above methods to communicate anonymously with the Audit Committee.
Misuse of Reporting Channels. Employees must not use these reporting channels in bad faith or in a false or frivolous manner. Further, employees should not use the Reporting Line to report grievances that do not involve the Code or other ethics-related issues.
Reporting; Anonymity; Retaliation
When reporting suspected violations of the Code, TPI prefers that officers and employees identify themselves in order to facilitate TPI’s ability to take appropriate steps to address the report, including conducting any appropriate investigation. However, TPI also recognizes that some people may feel more comfortable reporting a suspected violation anonymously.
If an officer or employee wishes to remain anonymous, he or she may do so, and TPI will use reasonable efforts to protect the confidentiality of the reporting person subject to applicable law, rule or regulation or to any applicable legal proceedings. In the event the report is made anonymously, however, TPI may not have sufficient information to look into or otherwise investigate or evaluate the allegations. Accordingly, persons who make reports anonymously should provide as much detail as is reasonably necessary to permit TPI to evaluate the matters set forth in the anonymous report and, if appropriate, commence and conduct an appropriate investigation.
No Retaliation
TPI expressly forbids any retaliation against any officer or employee who, acting in good faith, reports suspected misconduct. Any person who participates in any such retaliation will be subject to disciplinary action, up to and including termination.
Waivers and Amendments
No waiver of any provisions of the Code for the benefit of a director or an executive officer (which includes without limitation, for purposes of this Code, TPI’s principal executive, financial and accounting officers) shall be effective unless (i) approved by the Board of Directors or Audit Committee, and (ii) if applicable, such waiver is promptly disclosed to TPI’s shareholders in accordance with applicable United States securities laws and/or the rules and regulations of the exchange or system on which the Company’s shares are traded or quoted, as the case may be.
Any waivers of the Code for other employees may only be made in writing by the Compliance Officer, the Board of Directors or Audit Committee.
All amendments to the Code must be approved by the Board of Directors and Audit Committee and, if applicable, must be promptly disclosed to TPI’s shareholders in accordance with applicable United States securities laws and/or the rules and regulations of the exchange or system on which the Company’s shares are traded or quoted, as the case may be.