1.	Our comments with regard to the Form 10-K for the fiscal year ended December 31, 2009 are intended to apply to the Form 10-K for the fiscal year ended December 31, 2008, to the extent they are also relevant to such filing.

-

Form 8-K filed March 11, 2010, included the restated 2008 financial statements and has now been on file for more than two months.  That Form 8-K included a statement that the Company’s previously issued 2008 financial statements, as included in its 2008 Form 10-K filed with the SEC on March 16, 2009, should no longer be relied upon.

-

The 2009 Form 10-K, which included the restated 2008 financial statements, has now been on file for two full months.  That Form 10-K also included a statement (at page 38) to the effect that the 2008 financial statements had been restated, and that the 2008 financial statements, as included in the 2008 Form 10-K, should not be relied upon.  Additionally, the 2008 Form 10-K is now 14 months old.

-

In the 2009 Form 10-K we included disclosure (pages 21 and 22) about the unresolved staff comments on our 2008 Form 10-K. In the amended 2009 Form 10-K that we will file at such time as these comments are resolved, we will not remove this disclosure, but we will update it to indicate that the amended Form 10-K reflects revisions which have resolved the comments.

2.	Please refer to SEC Release No. 33-9089, Proxy Disclosure Enhancements, and provide us with a draft of enhanced disclosure that complies with the new rules.  We may have further comments after reviewing your response.

3.

We reissue comment 7 from our letter dated November 30, 2009 in relevant part.  Please disclose in this section your sources of liquidity, including a description of all material terms of the revolving loan agreement and the term loan agreement described in Note 10 to your financial statements.  In addition, we note your disclosure at page 38 regarding payments due within three years that relate to contractual obligations.  Please disclose your anticipated source of funds for such payments.

4.

Please enhance your disclosure so that it includes all of the information required by Item 401 of Regulation S-K.  For example, in many of the biographical sketches, information is missing as to specific titles held, specific names of organizations, and exact periods during which the titles were held.

 

Name; Current Positions Held	Age	Director since	Term expires at Annual meeting in
Hatem El Khalidi Co-founder and retired President & CEO of the Company	85	1968	2010
Nicholas N. Carter …………………………………………. President, Chief Executive Officer of the Company since July 2009, President of the Petrochemical Company since 1987, Member of AMAK Board	62	2004	2011
Robert E. Kennedy …………………………………………. Chairman of the Audit and Compensation Committees; Member of Nominating Committee and AMAK Board	65	2007	2012
Ghazi Sultan Chairman of the Nominating Committee; Member of  Compensation and Audit Committees and AMAK Board	73	1993	2010
Allen P. McKee Member of the Audit, Compensation and Nominating Committees and AMAK Board	68	2009	2012
Mohammed Al Omair Member of  Audit, Compensation and Nominating Committees	66	2007	2011
Charles W. Goehringer, Jr. General Counsel	51	2007	2011

Mr. Nicholas N. Carter, a U.S. citizen and the President and Chief Executive Officer of the Company since July 2009, is a 1975 graduate of Lamar University with a Bachelor of Business Administration Degree in Accounting.  Mr. Carter has been a Certified Public Accountant since 1977.  He worked at the Sabine River

Mr. Charles W. Goehringer, Jr., a U.S. citizen and partner of the law firm of Germer Gertz, L.L.P. in Beaumont, Texas, serves as corporate counsel for the Company.  From 1981-1987, Mr. Goehringer worked for Gulf States Utilities Company as a mechanical engineer and unit superintendent.  From 1987-1995, Mr. Goehringer worked for Quantum Chemical Company as a mechanical engineer and maintenance superintendent.  He next worked as an attorney for the law firm of Mehaffy Weber, P.C. from 1995-2000.   From 2000 to the present, Mr. Goehringer has been employed as an attorney with the law firm of Germer Gertz, L.L.P.  Mr. Goehringer holds a Bachelor of Science Degree in Mechanical Engineering from Lamar

 
 

 

Name	Positions	Age	Appointed
Nicholas N. Carter	President, Chief Executive Officer and Director/President - TOCCO	62	2009/1987
Mark Williamson	Vice President of Marketing - TOCCO	54	1996
Connie Cook	Chief Accounting Officer, Secretary, Treasurer/Secretary, Treasurer - TOCCO	46	2008/2004

5.	Please enhance your disclosure so that it includes all of the information required by Item 402 of Regulation S-K. For example:

●

You state on page 51 that “In 2009 the Company’s executives received no award based upon 2008 performance.”  However, there are awards shown in the “Bonus” column of the Summary Compensation Table.  Please explain.

●

Discuss in your Compensation Discussion and Analysis the grant of the option for 200,000 shares to Mr. El-Khalidi, which is stated in the 2009 Grants of Plan-Based Awards table to have occurred on July 2, 2009.  Explain the rationale for this grant.

“2.  Regarding the accrued retainers of Hatem El-Khalidi, currently about $400,000, which are demand loans to the Company, El-Khalidi shall have the option [the “1995 Option”] to convert any part of these loans outstanding at any time prior to the repayment of these loans into common shares of the Company, at the price of One ($1.00) US dollar per share.” (the “1995 Resolution”)

“RESOLVED that the Option granted by the Company to Hatem El-Khalidi pursuant to the 1995 Resolution is hereby officially terminated in all respects and shall be removed from the Company’s books and records.”

 

●

We note your statement on page 50 that “The Company includes an annual cash bonus as part of its compensation program because it believes this element of compensation helps to motivate management to achieve key individual and operational objectives by rewarding the achievement of these objectives.”  Similarly, on page 52, you state there is “a significant portion of total compensation reflecting a risk aspect tied to long-term and short-term financial and strategic goals.”  However, your discussion of “Performance Metrics” on page 52 appears to indicate that the process of determining awards is “subjective” and done after the fact, without pre-established performance metrics.  Please explain.  Also, your discussion of “Performance Metrics” is limited to the year 2009; accordingly, please add an explanation of the “long-term . . . financial and strategic goals.”

6.

You state at page 51 that for 2009 performance, $130,000 in cash and 65,000 in options were awarded and will be paid in the first quarter of 2010.  Please advise why the cash portion is not reflected in the Summary Compensation Table with respect to bonus payments earned in 2009.  See Item 402(c)(2)(iv) of Regulation S-K.

7.	Please disclose the standards to be applied by your board when determining whether to approve or ratify related party transactions.  See Item 404(b)(1)(ii) of Regulation S-K.

 

 

8.

We note your response to prior comment 9 in our letter dated February 23, 2010.  Please provide to us your detailed impairment analysis of the assets contributed to AMAK prepared in accordance with ASC 360.10.35-21(f) (SFAS 144, paragraph 8(f)) at the time of the contribution.  Your analysis should include the assumptions incorporated by you about the use of the assets and information regarding all other available information used by you in the analysis.  Please discuss how your assumptions were determined and how they are consistent with those assumptions used by you to negotiate your joint venture arrangement.  If a range was estimated for possible cash flows, tell us how you considered the likelihood of various possible outcomes.  We expect that your estimates included cash flows associated with future expenditures necessary to develop the properties, including any interest payments that would be capitalized.

-	Arabian Shield Development Company, Al Masane Project, Saudi Arabia, Feasibility Study for a 2000 TPD Concentrator and Related Infrastructure, Davy Project No. 1313, April 1994; and

-	Arabian Shield Development Company, Al Masane Project, Capital Cost Estimate Update for Concentrator and Related Facilities, Davy Project No. 1432, March 1996.

-	Volumes 1 and 2, Feasibility Study – Al Masane Project – For Arabian Shield Development Company and National Mining Company, WGM, August 27, 1982;

-	Review of the 1982 Feasibility Study – Al Masane Project – For Arabian Shield Development Company and National Mining Company, WGM, September 26, 1984;

-	Review of Feasibility Study – Al Masane Project – For Arabian Shield Development Company and National Mining Company, WGM, February 20, 1989;

-	Feasibility Study on the Al Masane Project for Arabian Shield Development Company, July 22, 1994; and

-	Al Masane project, Mine Capital and Operating Cost Update, 1st Quarter 1996, WGM, April 1, 1996.

-	Base Case: Production of 700,000 tpa for 11 years; capital investment increased to $139.5 million to allow for current tight machinery supply; and average metal 2007 YTD metal prices.

-	Scenarios 1-4: Production was increased to 840,000 tonnes during year 5 and further to 1,000,000 tonnes during year 9.

 

9.

We note your responses to prior comments 10 and 11 in our letter dated February 23, 2010.  Please provide to us a more detailed analysis of how you applied the provisions of ASC 323.10.05 and ASC 323.10.15 (APB 18, paragraphs 16 and 17) when you determined that you should not record your share of AMAK’s losses for the period of December 31, 2008 through August 2009, and that you should discontinue using the

-

all of AMAK’s assets and operations are in Saudi Arabia

-

as set forth below, at all times at least 50%, and now more than 50%, of the common stock of AMAK was held by foreign businesses or individuals

Stockholder	Original ownership	Ownership since August 2009	Nature and location of stockholder
Arabian American Development Company	50%	41%	U.S. corporation
Mr. Mohammed Aballala(a)	16%	18.88%	Saudi citizen
Thamarat Najran Co. Ltd. (a)	4%	4.72%	Saudi corporation
Al-Sha’er Trading, manufacturing and Contracting Company	10%	11.80%	Saudi corporation
His Royal Highness Prince Nawaf Bin Mishel Bin Saud Al Saud	8%	9.44%	Saudi citizen and member of the Saudi royal family
Mr. Ibraheem Bin Ali Bin Hussain Musallam (b)	5%	5.90%	Saudi citizen
Mr. Majed Bin Ali Bin Hussain Musallam (b)	5%	5.90%	Saudi citizen
Mr. Amer Bin Ali Bin Amer Babtain	2%	2.36%	Saudi citizen

-

as set forth below, the majority of the members of AMAK’s board of directors are not resident in, or citizens of, the United States

Name of director	Citizenship and residence
Directors appointed by Arabian American Development Company
Nicholas Carter	United States
Ghazi Sultan	Saudi Arabia
Robert Kennedy	United States
Allen McKee	United States
Directors appointed by Saudi investors
Dr. Talal Al Shair (a)	Saudi Arabia
Ibrahim Musallam	Saudi Arabia
Mohammed Aballala	Saudi Arabia
Ayman Al-Shibl	Saudi Arabia

-

during the year ended December 31, 2009, there were under Saudi GAAP no items of income or expense.  The draft financial statements state that “The Company has not yet commenced its commercial operations. The Company is not reporting a statement of income as no material expenses of a revenue nature were incurred during the period.”

-

for the year ended December 31, 2008, the only item of income or expense was an accrual for Zakat taxes of SR 1,965,000 (approximately $525,000).  (We discuss below how we intend to account for our 50% share of this expense.) The Zakat tax is an “alms tax” (a tithe tax) levied upon Saudi corporations and individuals “of sufficient means.” The tax is not calculated on income, but rather is based on “wealth” as defined in the statutes with wealth derived from different types of assets taxed at different rates, and its

 

-

assessment derives from the Islamic laws requiring those of sufficient means to tithe. There was no Zakat tax for 2009 as AMAK’s “wealth,” as defined, was negative. Additionally, the Zakat tax is only assessed on the “wealth” attributable to the portion of a corporation owned by Saudi shareholders.

-

provide that the auditor shall audit the financial statements of AMAK and shall present the financial statements to AMAK’s annual meeting (Article 45); and

-

provide that the annual meeting shall be held within the first six months of the year (Article 33).

-

when the AMAK Board selected an auditor, we believed that either Moore Stephens, because it was the Travis Wolff affiliate, or KPMG, because of its experience auditing mining operations, would be the best choices.  Notwithstanding, the Saudi directors selected Deloitte due to prior experience with that firm without even a formal vote on the Moore Stephens or KPMG firms.

-

AMAK had contracted with a Chinese firm for the construction of certain underground facilities preparatory to the production of ore. While that firm was selected, the Saudi directors believed that it should work under the direction of a Saudi general contractor, and took that course of action notwithstanding our stated position that the Chinese firm was well qualified to do the work and did not need a supervising general contractor.

•  attract and retain talented Executives by providing reasonable total compensation levels competitive with that of executives holding comparable positions in similarly situated organizations;

•  provide performance–based compensation that balances rewards for short–term and long–term results and is tied to both individual and the Company’s performance; and

•  encourage the long–term commitment of our Executives to the Company and its shareholders’ long–term interests.

 

Name and Principal Position	Year		Salary ($)				Bonus ($)(1)				Profit Sharing ($)				Restricted Stock Award(s) ($)				Option Award(s) ($)(2)				All Other Compensation ($) (3)(4)(5)				Total ($)
Hatem El Khalidi President and Chief Executive Officer until June 30, 2009, Director	2009		$	36,000			$	31,500				--				--			$	186,288			$	40,000			$	293,788
	2008		$	72,000				--				--				--				--			$	8,000			$	80,000
	2007		$	72,000				--				--				--				--			$	8,000			$	80,000
Nicholas N. Carter President and Chief Executive Officer since July 1, 2009; previously Executive Vice President and Chief Operating Officer	2009		$	234,837			$	60,000			$	42,552				--				--			$	14,090			$	351,479
	2008		$	209,918				--			$	28,665			$	99,800				--			$	12,595			$	350,978
	2007		$	172,059			$	50,000			$	46,506			$	66,000				--			$	10,324			$	344,889
Connie J. Cook Chief Accounting Officer	2009		$	142,208			$	30,000			$	32,715				--				--			$	8,533			$	213,456
	2008		$	133,009				--			$	26,143			$	49,900				--			$	7,981			$	217,033
	2007		$	108,500			$	25,000			$	45,085			$	33,000				--			$	6,510			$	218,095
Mark D. Williamson Vice President of Marketing, Petrochemical Company	2009		$	227,500			$	40,000			$	32,652				--				--			$	13,650			$	313,802
	2008		$	240,705				--			$	26,143			$	49,900				--			$	14,442			$	331,190
	2007		$	190,393			$	25,000			$	45,023				--				--			$	11,424			$	271,840
Gerardo Maldonado, Account Representative, Petrochemical Company	2009		$	192,543				--			$	24,437				--				--			$	11,553			$	228,533
	2008		$	179,158				--			$	14,640				--				--			$	10,749			$	204,547
	2007		$	142,443				--			$	24,327				--				--			$	8,546			$	175,316
Marvin Kaufman Manager of Manufacturing, Petrochemical Company	2009		$	130,532				--			$	21,910				--				--			$	7,832			$	160,274
	2008		$	122,603				--			$	13,110				--				--			$	7,356			$	143,069
	2007		$	112,534				--			$	21,526				--				--			$	6,752			$	140,812

 

(1)

Includes $31,500, $0 and $0 in retirement bonus compensation for the fiscal years ended December 31, 2009, 2008, and 2007, respectively, that was deferred at the election of Mr. El Khalidi.  All present deferred compensation owing to Mr. El Khalidi aggregating $31,500 is considered, and future deferred compensation owing to Mr. El Khalidi, if any, will be considered payable to Mr. El Khalidi on demand.

(2)

Restricted stock option awards include the aggregate grant date fair value of such awards granted in the fiscal year indicated computed in accordance with ASC 718.  For a discussion of the assumptions we made in valuing the stock and option awards, see “Note B (17)—Significant Accounting Policies—Stock-Based Compensation” and “Note (H)—Stock-Based Compensation” in the notes to our consolidated financial statements contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2009.

(3)

Includes $4,000, $8,000, and $8,000 in termination benefits for each of the fiscal years ended December 31, 2009, 2008, and 2007, respectively, that was accrued for Mr. El Khalidi in accordance with Saudi Arabian employment laws. The total amount of accrued termination benefits due to Mr. El Khalidi as of December 31, 2009, was $42,878.

(4)

Includes $36,000, $0, and $0 in accrued retirement benefits for each of the fiscal years ended December 31, 2009, 2008, and 2007, respectively, that was deferred at the election of Mr. El Khalidi.  The total amount of accrued retirement benefits due to Mr. El Khalidi as of December 31, 2009, was $36,000.

(5)	Includes amounts as shown for Executives that were contributed on the employee’s behalf into the Company’s 401(k) plan.  Mr. El-Khalidi did not participate in the Company’s 401(k) plan.

Estimated Future Payouts Under Non-Equity Incentive Plan Awards

Estimated Future Payouts under Equity Incentive Plan Awards

Name

Grant Date

Threshold ($)

Target ($)

Maximum ($)

Threshold (#)

Target (#)

Maximum (#)

All Other Stock Awards:  Number of Shares of Stock or  Units (#)

All Other Options Awards: Number of Securities (#)(1)

Exercise Price of Options ($/sh)

Closing Market Price on Date of Option Grant ($/sh)

Grant Date Fair Value of Stock Awards

Hatem El Khalidi

07/02/09

200,000

$

3.40

$

3.40

Hatem El Khalidi

07/02/09

200,000

$

3.40

$

3.40

(1)

Represents conditional stock option grants made on July 2, 2009 as follows: (a) an option to purchase 200,000 shares of the Company’s common stock with an exercise price equal to the closing sale price of such a share as reported on the Nasdaq National Market System on July 2, 2009, provided that said option may not be exercised until such time as the first shipment of ore from the Al Masane mining project is transported for commercial sale by AMAK, and further that said option terminates and is immediately forfeited if not exercised on or before June 30, 2012; and (b) an option to purchase 200,000 shares of the Company’s common stock with an exercise price equal to the closing sale price of such a share as reported on the Nasdaq Stock Market on July 2, 2009, provided that said option may not be exercised until such time as the Company receives its first cash dividend distribution from AMAK, and further that said option terminates and is immediately forfeited if not exercised on or before June 30, 2019.

Option awards

Stock awards

Name

Number of Securities Underlying Unexercised Options (#) Exercisable

Number of Securities Underlying Unexercised Options  (#) Unexercisable

Equity incentive plan awards: number of securities underlying unexercised unearned options (#)

Option exercise price ($)

Option Expiration date

Number of Shares or units of stock that have not vested (#)

Market value of shares or unites of stock that have not vested (#)

Equity incentive plan awards: number of unearned shares, units or other rights that have not vested (#)

Equity incentive plan awards: market or payout value of unearned shares, units or other rights that have not vested ($)

Hatem El Khalidi

--

200,000

--

$

3.40

06/30/12

Hatem El Khalidi

--

200,000

--

$

3.40

06/30/19

Name		Fees Earned or Paid in Cash ($)(1)				Stock Awards ($)(2)				Option Awards ($)(3)				Total ($)
Robert Kennedy		$	74,000			$	10,200			$	9,730			$	93,930
Ghazi Sultan			10,000				10,200				9,730				29,930
Mohammed Al Omair			25,000				10,200				9,730				44,930
Ibrahim Al-Moneef (resigned April 2009)			--				--				9,730				9,730
Charles Goehringer, Jr.			10,000				10,200				9,730				29,930
Allen McKee (appointed April 2009)			2,500				--				--				2,500

(1)	Includes committee fees for 2008 in the amount of $70,000, subsidiary board fees for 2008 in the amount of $5,000, subsidiary board fees for 2009 in the amount of $36,000 and per diem amounts for 2009 in the amount of $10,500.

(2)	Represents 3,000 shares of restricted stock granted to each non-employee director for 2008 Board service at $3.40 per share based upon the closing price of the Company’s common stock on the grant date of September 1, 2009.

(3)	Represents 7,000 shares of stock options granted to each non-employee director for 2008 Board service at an exercise price of $1.39 per share based upon the closing price of the Company’s common stock on the grant date of January 2, 2009.

 
 

 
 

Level	Leverage Ratio	Applicable Margin for Base Rate Loans	Applicable Margin for LIBOR Loans	Applicable Margin for Commitment Fee
I	Greater than or equal to 1.5:1.0	(0.50%)	2.00%	0.25%
II	Less than 1.5:1.0 but greater than or equal to 1.0:1.0	(0.75%)	1.75%	0.25%
III	Less than 1.0:1.0	(1.00%)	1.50%	0.25%

 
 

●	Delivery of financial statements and SEC filings;
●	Maintenance of properties and insurance;
●	Compliance with laws;
●	Receipt of guarantees from any new subsidiary to guarantee and secure obligations;
●	Prohibiting the disposition of assets and changing material lines of business;
●	Changing its method of accounting or policies;

●	Restricting certain payments, including dividends;
●	Use of loan proceeds only for certain purposes;
●	Payment of all insurance and eminent domain proceeds to Bank of America;
●	Limiting the occurrence of liens, certain investments, and/or subsidiary indebtedness (subject to certain exceptions);
●	Payment on demand of all reasonable costs, expenses and fees incurred by Bank of America; and
●	Restricting extension of credit other than for certain permitted exceptions;

●	Maintaining a minimum EBITDA of $8.5 million at end of each trailing four fiscal quarter period;
●	Maintaining a maximum leverage ratio of 2.0:1.0 measured at end of each fiscal quarter;
●	Prohibition of unfinanced capital expenditures in excess of $4.0 million for trailing four fiscal quarter period; and
●	Limitations on dividends paid to the parent company of 30% of EDITDA.

●	failure to pay principal, interest or other amounts due and payable;
●	failure to maintain compliance with the financial covenants and other covenants contained in the Restated Credit Agreement;
●	default on certain of our other indebtedness;
●	breach of a representation or warranty;
●	the existence of bankruptcy or insolvency proceedings;
●	the entry of certain judgments against South Hampton and its subsidiaries;
●	the invalidity of any loan document; and
●	upon a change of control.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.	Review and discuss with management and the independent auditor the annual audited financial statements, including disclosures made in management’s discussion and analysis, and recommend to the Board whether the audited financial statements should be included in the Company’s Form 10-K.

 

2.

Review and discuss with management and the independent auditor the Company’s quarterly financial statements, including disclosures made in management’s discussion and analysis, prior to the filing of its Form 10-Q, including the results of the independent auditor’s review of the quarterly financial statements.

 

3.

Discuss with management and the independent auditor (and review any related analysis prepared by management and/or the independent auditor) significant financial reporting issues and judgments made in connection with the preparation of the Company’s financial statements, including any significant changes, or alternatives considered, in the Company’s selection or application of accounting principles, any major issues as to the adequacy of the Company’s internal controls and any special steps adopted in light of material control deficiencies.

 

4.	Review and discuss quarterly reports from the independent auditors on:

 

(a)	All critical accounting policies and practices to be used.

 

(b)	All alternative treatments of financial information within generally accepted accounting principles that have been discussed with management, ramifications of the use of such alternative disclosures and treatments and the treatment preferred by the independent auditor.

 

(c)	Other material written communications between the independent auditor and management, such as any management letter or schedule of unadjusted differences.

 

5.	Discuss with management and the independent auditor the effect of regulatory and accounting initiatives as well as off-balance sheet structures on the Company’s financial statements.

 

6.	Discuss with the independent auditor the matters required to be discussed by Statement on Auditing Standards No. 61 relating to the conduct of the audit.

 

7.

Review disclosures made to the Audit Committee by the Company’s Chief Executive Officer and Chief Financial Officer during their certification process for the Form 10-K and Form 10-Q about any significant deficiencies in the design or operation of internal controls or material weaknesses therein and any fraud involving management or other employees who have a significant role in the Company’s internal controls.  Review and discuss any significant changes in internal controls with the Chief Financial Officer and Chief Executive Officer.

 

8.	Review and evaluate the lead partner of the independent auditor team.

 

9.

Obtain and review a report from the independent auditor at least annually regarding (a) the independent auditor’s internal quality-control procedures, (b) any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm, (c) any steps taken to deal with any such issues and (d) all relationships between the independent auditor and the Company.  Evaluate the qualifications, performance, objectivity and independence of the independent auditor, including considering whether the auditor’s quality controls are adequate and the provision of permitted non-audit services is compatible with maintaining the auditor’s objectivity and independence, taking into account the opinions of management and internal auditors.  The Audit Committee shall present its conclusions with respect to the independent auditor to the Board.

 

10.	Ensure the rotation of the audit partners as required by applicable laws and regulations.

 

11.	Discuss with the national office of the independent auditor issues on which they were consulted by the Company’s audit team and matters of audit quality and consistency.

 

12.	Meet with the independent auditor prior to the audit to discuss the planning and staffing of the audit.

 

13.	Obtain from the independent auditor assurance that Section 10A(b) of the Exchange Act (relating to illegal acts) has not been implicated.

 

14.

Obtain reports from management and the independent auditor that the Company and its affiliated entities are in conformity with applicable legal requirements and the Company’s Code of Ethics.  Review reports and disclosures of insider and related party transactions.  Advise the Board with respect to the Company’s policies and procedures regarding compliance with applicable laws and regulations and with the Company’s Code of Ethics.

 

15.	Establish procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.

 

16.	Discuss with management and the independent auditor any correspondence with regulators or governmental agencies and any published reports which raise material issues regarding the Company’s financial statements or accounting policies.

 

17.	Discuss with the Company’s outside counsel, to the extent deemed appropriate, legal matters that may have a material impact on the financial statements or the Company’s compliance policies.

 

18.	Review and, if appropriate, approve all related party transactions.

 

 

 

 

 

 

 

 

 

 

 

 

 

(i)           a director (which term when used herein includes any director nominee),

 

(ii)           an executive officer,

 

(iii)           a person known by the Company to be the beneficial owner of more than 5% of the Company's common stock (a "5% stockholder"), or

 

(iv)           a person known by the Company to be an immediate family member of any of the foregoing.

 

 

 

 

 

 

 

(i)	whether the terms of the Related Party Transaction are fair to the Company and on the same basis as would apply if the transaction did not involve a Related Party;

 

(ii)	whether there are business reasons for the Company to enter into the Related Party Transaction;

 

(iii)

whether the Related Party Transaction would impair the independence of an outside director; and

 

(iv)

whether the Related Party Transaction would present an improper conflict of interests for any director or executive officer of the Company, taking into account the size of the transaction, the overall financial position of the director, executive officer or Related Party, the direct or indirect nature of the director's, executive officer's or Related Party's interest in the transaction and the ongoing nature of any proposed relationship, and any other factors the AC deems relevant.