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NATURAL ALTERNATIVES INTERNATIONAL, INC.
Natural Alternatives International, Inc. (the “Company”) has established a hotline for employees to confidentially report any suspected illegal or fraudulent activities in accordance with the Sarbanes-Oxley Act Section 301 (4). The Company entered into an agreement with The Network to provide a 24/7 hotline for employees that do not feel comfortable speaking directly to their supervisor. The hotline will manage calls specifically related to suspected illegal or fraudulent activities. Employees who report incidents other than suspected illegal or fraudulent activities to The Network will be advised to call Jo Phillippe, Director of Human Resources, at 760-736-7726.
Employees in the United States may call The Network’s toll-free number 1-877-888-0002. International callers may place a collect call to The Network’s designated phone number, 770-810-1147, in the United States following country-specific collect call procedures. The Network maintains English and Spanish speaking Specialists in addition to access to translation services in more than 150 languages.
Callers will immediately receive a pre-recorded greeting and are automatically routed to a Specialist (the “Specialist). After greeting the caller the Specialist selects Natural Alternatives International, Inc. in The Network’s computer system. The Specialist checks for any special instructions in the notes section of the greeting prior to taking a report. The Specialist documents the caller’s name and location information and explains to the caller what to expect during the call. Using the Network’s proprietary system the Specialist begins the interview and captures the details of the call within the system. Among the information captured:
The Specialist assigns an incident code to the report based on the predominant issue type reported by the caller. The Network’s incident codes specific to the Sarbanes-Oxley Act are as follows:
* These Incident Codes automatically prompt the Specialist to ask if the incident will happen again within the next 24 hours, which triggers the escalation process if the caller thinks it will.
Additional system-generated questions and instructions are triggered by the incident code, helping the Specialist dig deeper into the unique aspects of a particular issue and ensuring all relevant information is captured. The system also actively analyzes the report and identifies factors or combinations of factors that require additional information. During the interview, the system monitors information intake. Before the call is concluded, the system points out/flags missing information and potential errors for the Specialist to review with the caller. The report cannot be completed until every critical system data requirement is met.
The information gathered during the call is organized in an incident report detailing the who, what, when, where and how of the incident. The incident report is an active document in the system, updated and redistributed as follow-up information is added.
The standard incident report is automatically disseminated within an average of four hours, as quickly as a few minutes, and always less than one business day via email or auto fax to our designated contacts. All incident reports related to Sarbanes-Oxley issues will be disseminated to Joe Davis, Alan Dunn and Alan Lane, NAI’s Audit Committee Members. Upon receiving the incident report from The Network, Messrs. Davis, Dunn and Lane, will meet with Kenneth Wolf, CFO and Mark LeDoux, CEO, to discuss the proper action that should be taken to resolve the incident in a timely fashion.
An incident report that requires immediate notification is escalated if it meets the following criteria:
Once a report designated for escalation is complete, it is automatically relayed to The Network’s dedicated escalation team, who begins immediate notification of the designated contacts mentioned above. The escalation team uses the following escalation process:
Each month NAI’s Audit Committee members and Messrs. Wolf and LeDoux receive management summary reports via email as a PDF attachment or autofax. These reports help analyze hotline activity, recognize trends and “hot spots” in the organization, document due diligence and identify corrective actions and ongoing communication needs of the Company.
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