POLICIES & PROCEDURES

The following corporate governance materials that were adopted by the Board or Nominating and Governance Committee on February 7, 2007:

Introduction

The Company has adopted a Code of Business Conduct and Ethics applicable to all employees that urges employees promptly to discuss with or disclose to their supervisor, senior corporate officers, or the Chairman of the Audit Committee events of questionable, fraudulent, or illegal nature.  In addition, the Company has adopted a Code of Ethics for the Chief Executive Officer and senior financial officers that, among other things, requires prompt internal reporting of violations of that Code, the Code of Business Conduct and Ethics, fraud, and a variety of other matters.
As an additional measure to support our commitment to ethical conduct, the Audit Committee of our Board of Directors has adopted the following policies and procedures for (i) the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal controls, or auditing matters; and (ii) the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters.

Reporting of Concerns or Complaints Regarding Accounting, Internal Controls, or Auditing Matters.

Taking action to prevent problems is part of the Company’s culture.  If you observe possible unethical or illegal conduct, you are encouraged to report your concerns.  Employees and others involved with the Company are urged to come forward with any such information, without regard to the identity or position of the suspected offender.

Employees and others may choose any of the following modes of communicating suspected violations of law, policy, or other wrongdoing, as well as any concerns regarding questionable accounting or auditing matters (including deficiencies in internal controls):

  • Report the matter to your supervisor; or
  • Report the matter to the Company’s CEO or CFO; or
  • Report the matter to the Chairman of the Audit Committee.

Confidentiality

The Company will treat all communications under this Policy in a confidential manner, except to the extent necessary (a) to conduct a complete and fair investigation, or (b) for reviews of Company operations by the Company’s Board of Directors, its Audit Committee, and the Company’s independent public accountants.

Moreover, if your situation requires that your identity be protected, please submit an anonymous report as set forth in Schedule A.  Please be aware that the addresses identified for the Chairman of the Audit Committee are under the sole control of the Audit Committee Chairman.

Retaliation

Any individual who in good faith reports a possible violation of the Company’s Code of Business Conduct and Ethics, the Code of Ethics for the Chief Executive Officer and Senior Financial Officers or any law, rule, or regulation of the Securities and Exchange Commission or any provision of Federal law relating to fraud against shareholders (including any concerns regarding questionable accounting or auditing matters), even if the report is mistaken, or who assists in the investigation of a reported violation, will be protected by the Company.  Retaliation in any form against these individuals will not be tolerated.  Any act of retaliation should be reported immediately and will be disciplined appropriately.

Specifically, the Company will not discharge, demote, suspend, threaten, harass, or in any other manner discriminate or retaliate against any employee in the terms and conditions of the employee’s employment because of any lawful act done by that employee to either (a) provide information, cause information to be provided, or otherwise assist in any investigation regarding any conduct that the employee reasonably believes constitutes a violation of any Company code of conduct or any law, rule, or regulation of the Securities and Exchange Commission or any provision of Federal law relating to fraud against shareholders, or (b) file, cause to be filed, testify, participate in, or otherwise assist in a proceeding filed or, to the employee’s knowledge, about to be filed relating to an alleged violation of any such code, law, rule, or regulation.

Last Revised as of February 24, 2016

The Nominating and Governance Committee (the “Committee”) believes that members of the Board of Directors (the “Board”)  of RELM Wireless Corporation (the “Company”) must possess certain basic personal and professional qualities in order to properly discharge their fiduciary duties to stockholders, provide effective oversight of the management of the Company and monitor the Company’s adherence to principles of sound corporate governance. It is therefore the policy of the Committee that all persons nominated to serve as a director of the Company should possess the minimum qualifications described in this policy. These are only threshold criteria, however, and the Committee will also consider the contributions that a candidate can be expected to make to the collective functioning of the Board based upon the totality of the candidate’s credentials, experience and expertise, the composition of the Board at the time, and other relevant circumstances.

  1. Integrity. All candidates must be individuals of personal integrity and ethical character, and who value and appreciate these qualities in others.
  2. Absence of Conflicts of Interest. Candidates should not have any interests that would materially impair his or her ability to (i) exercise independent judgment, or (ii) otherwise discharge the fiduciary duties owed as a director to the Company and its stockholders.
  3. Fair and Equal Representation. Candidates must be able to represent fairly and equally all stockholders of the Company without favoring or advancing any particular stockholder or other constituency of the Company.
  4. Achievement. Candidates must have demonstrated achievement in one or more fields of business, professional, governmental, communal, scientific or educational endeavor.
  5. Oversight. Candidates are expected to have sound judgment, as result of management or policy-making experience (which may be as an advisor or consultant), that demonstrates an ability to function effectively in an oversight role.
  6. Business Understanding. Candidates must have a general appreciation regarding major issues facing public companies of a size and operational scope similar to the Company. These include:
  • contemporary governance concerns;
  • regulatory obligations of a public issuer;
  • strategic business planning;
  • competition in a global economy; and
  • basic concepts of corporate finance.
  1. Available Time. Candidates must have, and be prepared to devote, adequate time to the Board and its committees. It is expected that each candidate will be available to attend substantially all meetings of the Board and any committees on which the candidate will serve, as well as the Company’s annual meeting of stockholders, after taking into consideration such candidate’s other business and professional commitments, including service on the boards of other companies.
  2. Age and Term Limits. The candidate’s election must not conflict with any term and/or age limits, if applicable, for directors.
  3. Limited Exceptions. Under exceptional and limited circumstances, the Committee may approve the candidacy of a candidate who does not satisfy all of these requirements if it believes the service of such candidate is in the best interests of the Company and its stockholders.
  4. Additional Qualifications. In approving candidates for election as directors, the Committee will also assure that:
  • at least a majority of the directors serving at any time on the Board are independent, as defined under the rules of the principal stock market on which the Company’s common shares are listed for trading;
  • at least three of the directors satisfy the financial literacy requirements required for service on the audit committee under the rules of the principal stock market on which the Company’s common shares are listed for trading;
  • at least one of the directors qualifies as an audit committee financial expert under the rules of the Securities and Exchange Commission;
  • at least some of the independent directors have experience as senior executives of a public or substantial private company; and
  • at least some of the independent directors have general familiarity with an industry or industries in which the Company conducts a substantial portion of its business or in related industries.
  1. Diversity. The Committee will seek to promote through the nominations process an appropriate diversity on the Board of professional background, experience, expertise, perspective, age, gender, ethnicity and country of citizenship.

Last Revised as of February 24, 2016

Last Revised as of February 24, 2016

The Nominating and Governance Committee (the “Committee) will observe the following procedures in identifying and evaluating candidates for election to the Board of Directors (the “Board”) of RELM Wireless Corporation (the “Company”).

The Company is of the view that the continuing service of qualified incumbents promotes stability and continuity in the function of the Board, contributing to the Board’s ability to work as a collective body, while giving the Company the benefit of the familiarity and insight into the Company’s affairs that its directors have accumulated during their tenure. Accordingly, the process of the Committee for identifying nominees shall reflect the Company’s practice of re-nominating incumbent directors who continue to satisfy the Committee’s criteria for membership on the Board, whom the Committee believes continue to make important contributions to the Board and who consent to continue their service on the Board.

Consistent with this policy, in considering candidates for election at annual meetings of stockholders, the Committee will first determine the incumbent directors whose terms expire at the upcoming meeting and who wish to continue their service on the Board.

The Committee will evaluate the qualifications and performance of the incumbent directors that desire to continue their service. In particular, as to each such incumbent director, the Committee will:

  • consider if the director continues to satisfy the minimum qualifications for director candidates adopted by the Committee;
  • review the assessments of the performance of the director during the preceding term made by the Committee; and
  • determine whether there exist any special, countervailing considerations against re-nomination of the director.

If the Committee determines that (a) an incumbent director consenting to re-nomination continues to be qualified and has satisfactorily performed his or her duties as director during the preceding term and (b) there exist no reasons, including considerations relating to the composition and functional needs of the Board as a whole, why in the Committee’s view the incumbent should not be re-nominated, the Committee will, absent special circumstances, propose the incumbent director for re-election.

Consistent with the Company’s policy regarding director candidates submitted by stockholders, the Company shall only consider recommendations of director candidates from stockholders where the Committee has determined to not re-nominate a qualified incumbent director.

The Committee will identify and evaluate new candidates for election to the Board where there is no qualified and available incumbent, including for the purpose of filling vacancies arising by reason of the resignation, retirement, removal, death or disability of an incumbent director or a decision of the directors to expand the size of the Board.

The Committee will solicit recommendations for nominees from persons that the Committee believes are likely to be familiar with qualified candidates. These persons may include members of the Board, including members of the Committee, and management of the Company. The Committee may also determine to engage a professional search firm to assist in identifying qualified candidates.

As to each recommended candidate that the Committee believes merits consideration, the Committee will:

  • cause to be assembled information concerning the background and qualifications of the candidate, including information concerning the candidate required to be disclosed in the Company’s proxy statement under the rules of the Securities and Exchange Commission and any relationship between the candidate and the person or persons recommending the candidate;
  • determine if the candidate satisfies the minimum qualifications required by the Committee of candidates for election as director;
  • determine if the candidate possesses any of the specific qualities or skills that under the Committee’s policies must be possessed by one or more members of the Board;
  • consider the contribution that the candidate can be expected to make to the overall functioning of the Board; and
  • consider the extent to which the membership of the candidate on the Board will promote diversity among the directors.

It is appropriate for the Committee, in its discretion, to solicit the views of the Chief Executive Officer, other members of the Company’s senior management and other members of the Board regarding the qualifications and suitability of candidates to be nominated as directors.

In its discretion, the Committee may designate one or more of its members (or the entire Committee) to interview any proposed candidate.  Other members of the Board may, at their discretion, interview any such proposed candidate.

Based on all available information and relevant considerations, the Committee will select, a candidate who, in the view of the Committee, is most suited for membership on the Board.

The Committee shall maintain appropriate records regarding its process of identifying and evaluating candidates for election to the Board.

Last Revised as of February 24, 2016

It is the policy of the Nominating and Governance Committee (the “Committee”) of the Board of Directors of RELM Wireless Corporation (the “Company”) to consider recommendations for the nomination of director candidates submitted by holders of shares of the Company’s common stock entitled to vote generally in the election of directors.

The Committee will give consideration to these recommendations for positions on the Company’s Board of Directors where the Committee has determined to not re-nominate a qualified incumbent director.

For each annual meeting of stockholders, the Committee will accept for consideration only one recommendation from any stockholder or affiliated group of stockholders. An affiliated group of stockholders means stockholders constituting a group under Regulation 13D-G of the Securities Exchange Act of 1934, as amended.

In order for the recommendation of a stockholder to be considered under this policy, the recommending stockholder or group of stockholders must have owned at least five percent (5%) of the Company’s common stock for at least  one (1) year as of the date the recommendation was made.

The Committee shall also consider the extent to which the stockholder making the nominating recommendation intends to maintain its ownership interest in the Company.

The Committee shall only consider director candidates so recommended who satisfy the minimum qualifications prescribed by the Committee for director candidates, including that a director must represent the interests of all stockholders and not serve for the purpose of favoring or advancing the interests of any particular stockholder group or other constituency.

Only those recommendations whose submission complies with the procedural requirements adopted by the Committee will be considered by the Committee.

Last Revised as of February 24, 2016

Last Revised as of February 24, 2016

Stockholders Entitled to Make Submissions. The Nominating and Governance Committee (the “Committee”) of the Board of Directors of RELM Wireless Corporation (the “Company”) will accept for consideration submissions from stockholders of recommendations for the nomination of directors to the extent consistent with and permitted by the Committee’s “Policy Regarding Director Candidate Recommendations Submitted by Stockholders” in effect from time to time. Acceptance of a recommendation for consideration does not imply that the Committee will nominate the recommended candidate.

Manner and Address for Submission. All stockholder nominating recommendations must be in writing, addressed to the Committee care of the Company’s corporate secretary at the Company’s principal headquarters, 7100 Technology Drive, West Melbourne, Florida 32904. Submissions must be made by mail, courier or personal delivery. E-mailed submissions will not be considered.

Information Concerning the Recommending Stockholders. A nominating recommendation must be accompanied by the following information concerning each recommending stockholder:

  • The name and address, including telephone number, of the recommending stockholder;
  • The number of the Company’s shares owned by the recommending stockholder and the time period for which such shares have been held;
  • If the recommending stockholder is not a stockholder of record, a statement from the record holder of the shares (usually a broker or bank) verifying the holdings of the stockholder and a statement from the recommending stockholder of the length of time that the shares have been held. (Alternatively, the stockholder may furnish a current Schedule 13D, Schedule 13G, Form 3, Form 4 or Form 5 filed with the Securities and Exchange Commission reflecting the holdings of the stockholder, together with a statement of the length of time that the shares have been held); and
  • A statement from the stockholder as to whether the stockholder has a good faith intention to continue to hold the reported shares through the date of the Company’s next annual meeting of stockholders.

Information Concerning the Proposed Nominee. A nominating recommendation must be accompanied by the following information concerning the proposed nominee:

  • the information required by Item 401 of SEC Regulation S-K (generally providing for disclosure of the name, address, any arrangements or understanding regarding nomination and five year business experience of the proposed nominee, as well as information regarding certain types of legal proceedings within the past ten years involving the nominee);
  • the information required by Item 403 of SEC Regulation S-K (generally providing for disclosure regarding the proposed nominee’s ownership of securities of the Company); and
  • the information required by Item 404(a) of SEC Regulation S-K (generally providing for disclosure of any transaction in which the Company is a participant and the amount involved exceeds $120,000, and in which the proposed nominee has a direct or indirect material interest).

Relationships Between the Proposed Nominee and the Recommending Stockholder. The nominating recommendation must describe all relationships between the proposed nominee and the recommending stockholder and any agreements or understandings between the recommending stockholder and the nominee regarding the nomination.

Other Relationships of the Proposed Nominee. The nominating recommendation shall describe all relationships between the proposed nominee and any of the Company’s competitors, customers, suppliers, labor unions or other persons with special interests regarding the Company.

Qualifications of the Proposed Nominee. The recommending stockholder must furnish a statement supporting its view that the proposed nominee possesses the minimum qualifications prescribed by the Committee for nominees, and briefly describing the contributions that the nominee would be expected to make to the Board and to the governance of the Company.

Ability to Represent All Stockholders. The recommending stockholder must state whether, in the view of the stockholder, the proposed nominee, if nominated and elected, would represent all stockholders and not serve for the purpose of advancing or favoring any particular stockholder or other constituency of the Company.

Consent to be interviewed by the Committee and, if nominated and elected, to serve. The nominating recommendation must be accompanied by the consent of the proposed nominee to be interviewed by the Committee, if the Committee chooses to do so in its discretion (and the recommending stockholder must furnish the proposed nominee’s contact information for this purpose), and, if nominated and elected, to serve as a director of the Company.

Timing for Submissions Regarding Nominees for Election at Annual Meetings. A stockholder (or group of stockholders) wishing to submit a nominating recommendation for an annual meeting of stockholders must ensure that it is received by the Company, as provided above, not later than 120 calendar days prior to the first anniversary of the date of the proxy statement for the prior annual meeting of stockholders. In the event that the date of the annual meeting of stockholders for the current year is more than 30 days following the first anniversary date of the annual meeting of stockholders for the prior year, the submission of a recommendation will be considered timely if it is submitted a reasonable time in advance of the mailing of the Company’s proxy statement for the annual meeting of stockholders for the current year.

Stockholder Groups. If a recommendation is submitted by a group of two or more stockholders, the information regarding recommending stockholders must be submitted with respect to each stockholder in the group.

Last Revised as of February 24, 2016

Last Revised as of February 24, 2016

Policy

It is the policy of the Board of Directors (the “Board”) of RELM Wireless Corporation (the “Company”) that all “Interested Transactions” with “Related Persons,” as those terms are defined in this policy, shall be subject to approval or ratification in accordance with the procedures set forth below.

Procedures

The Company’s Nominating and Governance Committee (the “Committee”) of the Board shall review the material facts of all Interested Transactions that require the Committee’s approval and either approve or disapprove of the entry into the Interested Transaction, subject to the exceptions described below. If advance Committee approval of an Interested Transaction is not feasible, then the Interested Transaction shall be considered and, if the Committee determines it to be appropriate, ratified at the Committee’s next regularly scheduled meeting. In determining whether to approve or ratify an Interested Transaction, the Committee will take into account, among other factors it deems appropriate, whether the Interested Transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances and the extent of the Related Person’s interest in the transaction.

The Committee has reviewed the Interested Transactions described below in “Standing Pre-Approval for Certain Interested Transactions” and determined that each of the Interested Transactions described therein shall be deemed to be pre-approved or ratified (as applicable) by the Committee under the terms of this policy. In addition, the Board has delegated to the chairperson of the Committee the authority to pre-approve or ratify (as applicable) any Interested Transaction with a Related Person in which the aggregate amount involved is expected to be less than $250,000. In connection with each regularly scheduled meeting of the Committee, a summary of each new Interested Transaction deemed pre-approved pursuant to paragraph (3) or (4) under “Standing Pre-Approval for Certain Interested Transactions” below and each new Interested Transaction pre-approved by the chairperson in accordance with this paragraph shall be provided to the Committee for its review.

No director shall participate in any discussion or approval of an Interested Transaction for which he or she is a Related Person, except that the director shall provide all material information concerning the Interested Transaction to the Committee.

If an Interested Transaction will be ongoing, the Committee shall establish guidelines for the Company’s management to follow in its ongoing relationships with the Related Person. At the Committee’s first meeting of each fiscal year, the Committee shall review and assess ongoing relationships with the Related Person to determine if such relationships are in compliance with the Committee’s guidelines.  Based on all the relevant facts and circumstances, the Committee shall determine if it is in the best interests of the Company and its stockholders to continue, modify or terminate any such Interested Transaction.

Definitions

An “Interested Transaction” is any transaction, arrangement or relationship or series of similar transactions, arrangements or relationships (including any indebtedness or guarantee of indebtedness) in which (1) the aggregate amount involved does, will or may be expected to exceed $120,000 (or if less, one percent (1%) of the average of the Company’s total assets at year-end for the last two completed fiscal years), (2) the Company (including any of its subsidiaries) was, is or will be a participant, and (3) any Related Person had, has or will have a direct or indirect interest.

A “Related Person” is (a) any person who is, or at any time since the beginning of the Company’s last fiscal year was, a director or executive officer of the Company or a nominee to become a director of the Company, (b) any person who is known to be the beneficial owner of more than 5 percent of any class of the Company’s voting securities, (c) any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law of the director, executive officer, nominee or more than 5% beneficial owner, and any person (other than a tenant or employee) sharing the household of such director, executive officer, nominee or more than 5% beneficial owner and (d) any firm, corporation or other entity in which any of the foregoing persons is employed or is a partner or principal or in a similar position or in which such person and all other related persons have, in the aggregate, a 10% or greater beneficial ownership interest.

Standing Pre-Approval for Certain Interested Transactions

The Committee has reviewed the types of Interested Transactions described below and determined that each of the following Interested Transactions shall be deemed to be pre-approved by the Committee, even if the aggregate amount involved will exceed $120,000.

Employment of executive officers. Any employment by the Company of an executive officer of the Company if:

(a) the related compensation is required to be reported in the Company’s proxy statement under Item 402 of the Securities and Exchange Commission’s (“SEC’s”) compensation disclosure requirements (generally applicable to “named executive officers”); or

 

(b) the executive officer is not an immediate family member of another executive officer or director of the Company, the related compensation would be reported in the Company’s proxy statement under Item 402 of the SEC’s compensation disclosure requirements if the executive officer was a “named executive officer,” and the Company’s Compensation Committee approved (or recommended that the Board approve) such compensation.

Director compensation. Any compensation paid to a director if the compensation is required to be reported in the Company’s proxy statement under Item 402 of the SEC’s compensation disclosure requirements;

Certain transactions with other companies. Any transaction with another company at which a Related Person’s only relationship is as an employee (other than an executive officer), director or beneficial owner of less than 10% of that company’s shares, if the aggregate amount involved does not exceed the greater of $500,000, or two percent (2%) of that company’s total annual revenues;

Certain Company charitable contributions. Any charitable contribution, grant or endowment by the Company to a charitable organization, foundation or university at which a Related Person’s only relationship is as an employee (other than an executive officer) or a director, if the aggregate amount involved does not exceed the lesser of $500,000, or two percent (2%) of the charitable organization’s total annual receipts;

Transactions where all stockholders receive proportional benefits. Any transaction where the Related Person’s interest arises solely from the ownership of the Company’s common stock and all holders of the Company’s common stock received the same benefit on a pro rata basis (e.g., dividends).

Transactions involving competitive bids. Any transaction involving a Related Person where the rates or charges involved are determined by competitive bids.

Regulated transactions. Any transaction with a Related Person involving the rendering of services as a common or contract carrier, or public utility, at rates or charges fixed in conformity with law or governmental authority.

Certain banking-related services. Any transaction with a Related Person involving services as a bank depositary of funds, transfer agent, registrar, trustee under a trust indenture, or similar services.

Disclosure

All Interested Transactions that are required to be disclosed in the Company’s filings with the SEC, as required by the Securities Act of 1933 and the Securities Exchange Act of 1934 and related rules and regulations promulgated thereunder, shall be so disclosed in accordance with such laws, rules and regulations.

The material features of this policy shall be disclosed in the Company’s annual report on Form 10-K or in the Company’s proxy statement, as required by applicable laws, rules and regulations.

Last Revised as of February 24, 2016

At RELM Wireless Corporation, consistent with our core values, we recognize the responsibility to not support or contribute to the violence and human rights violations associated with the mining of certain minerals in Central Africa described as the “Conflict
Region”1.

Our products utilize certain electronic components that contain various metals, including tantalum, tin, tungsten and gold. These four metals are sourced worldwide, including from the Eastern provinces of the Democratic Republic of Congo (DRC), where millions have died in a civil war that has persisted for more than a decade. Armed militias profit from the trade of these metals in the DRC and other nearby countries in the Conflict Region.

In the U.S., Section 1502 of the 2010 Dodd-Frank Act requires companies to file an annual special disclosure with the U.S. Securities and Exchange Commission beginning in 2014 indicating if their products include metals sourced from the Conflict Region.

We support the 2010 Dodd-Frank Act and the related U.S. Securities and Exchange Commission rule that promote transparency and consumer awareness regarding the use of “Conflict Minerals”2 and seeks to cut direct and indirect funding of armed groups engaged in conflict and human rights abuses in the Conflict Region.

RELM does not directly purchase any Conflict Minerals from any source and does not knowingly procure any product containing Conflict Minerals from the Conflict Region. To the extent RELM’s products may include components containing “Conflict Minerals” that are necessary to the functionality of the product, RELM is committed to working with its supply chain to increase transparency regarding the origin of such minerals. RELM’s due diligence is based on guidance established by the Electronic Industry Citizenship Coalition for responsible sourcing of minerals.

We encourage our suppliers to adopt similar policies and procedures with respect to Conflict Minerals and to drive those efforts throughout their supply chain to ensure that the specified metals are being sourced only from (1) mines and smelters outside the “Conflict Region” or (2) mines and smelters within the Conflict Region which have been certified by an independent third party as “conflict free.”

1 “Conflict Region” includes the Democratic Republic of the Congo, Angola, Burundi, the Central African Republic,
The Republic of Congo, Uganda, Rwanda, South Sudan, Tanzania and Zambia.

2 “Conflict Minerals” include Columbite-Tantalite (Tantalum), Cassiterite (Tin), Gold, Wolframite (Tungsten) and
any derivativesfrom these minerals.

INSIDER TRADING POLICY AND GUIDELINES WITH RESPECT TO TRANSACTIONS IN COMPANY SECURITIES

Amended and Restated Effective January 17, 2006

1. Overview

RELM Wireless Corporation’s (the “Company”) board of directors has adopted this Insider Trading Policy for our directors, officers, employees and consultants with respect to the trading of the Company’s securities, as well as the securities of publicly traded companies with whom we have a business relationship. Federal and state securities laws prohibit the purchase or sale of a company’s securities by persons who are aware of material information about that company that is not generally known or available to the public. These laws also prohibit persons who are aware of such material nonpublic information from disclosing this information to others who may trade. Companies and their controlling persons are also subject to liability if they fail to take reasonable steps to prevent insider trading by company personnel.

It is important that you understand the breadth of activities that constitute illegal insider trading and the consequences, which can be severe. Both the U.S. Securities and Exchange Commission (the “SEC”) and the American Stock Exchange investigate and are very effective at detecting insider trading. The SEC, together with the U.S. Justice Department, pursue insider trading violations vigorously. Cases have been successfully prosecuted against trading by employees through foreign accounts, trading by family members and friends, and trading involving only a small number of shares.

This Insider Trading Policy is designed to prevent insider trading or allegations of insider trading, and to protect the Company’s reputation for integrity and ethical conduct. It is your obligation to understand and comply with this policy. Should you have any questions regarding this policy, please contact Andrew E. Balog of Greenberg Traurig, P.A., our outside securities counsel, at (305) 579-0642.

2. Penalties for Noncompliance

Civil and Criminal Penalties. Potential penalties for insider trading violations include (1) imprisonment for up to 20 years, (2) criminal fines of up to $5 million, and (3) civil fines of up to three times the profit gained or loss avoided.

Controlling Person Liability. If the Company fails to take appropriate steps to prevent illegal insider trading, the Company may have “controlling person” liability for a trading violation, with civil penalties of up to the greater of $1 million and three times the profit gained or loss avoided, as well as a criminal penalty of up to $25 million. The civil penalties can extend personal liability to the Company’s directors, officers and other supervisory personnel if they fail to take appropriate steps to prevent insider trading.

Company Sanctions. Failure to comply with this policy may also subject you to Company imposed sanctions, including dismissal for cause, whether or not your failure to comply with this policy results in a violation of law.

3. Scope of Policy

Persons Covered. As a director, officer, employee or consultant of the Company or its subsidiaries, this policy applies to you. The same restrictions that apply to you apply to your family members who reside with you, anyone else who lives in your household and any family members who do not live in your household but whose transactions in Company securities are directed by you or are subject to your influence or control (such as parents or children who consult with you before they trade in Company securities). You are responsible for making sure that the purchase or sale of any security covered by this policy by any such person complies with this policy.

Companies Covered. The prohibition on insider trading in this policy is not limited to trading in the Company’s securities. It includes trading in the securities of other firms, such as customers or suppliers of the Company and those with which the Company may be negotiating major transactions, such as an acquisition, investment or sale. Information that is not material to the Company may nevertheless be material to one of those other firms.

Transactions Covered. Trading includes purchases and sales of stock, derivative securities such as put and call options and convertible debentures or preferred stock, and debt securities (debentures, bonds and notes). Trading also includes certain transactions under Company stock option plans. This policy’s trading restrictions generally do not apply to the exercise of a stock
option. The trading restrictions do apply, however, to any sale of the underlying stock or to a cashless exercise of the option through a broker, as this entails selling a portion of the underlying stock to cover the costs of exercise.

4. Statement of Policy

No Trading on Inside Information. You may not trade in the securities of the Company, directly or through family members or other persons or entities, if you are aware of material nonpublic information relating to the Company. Similarly, you may not trade in the securities of any other company if you are aware of material nonpublic information about that company which you obtained in the course of your employment or relationship with the Company.

No Tipping. You may not pass material nonpublic information on to others or recommend to anyone the purchase or sale of any securities when you are aware of such information. This practice, known as “tipping,” also violates the securities laws and can result in the same civil and criminal penalties that apply to insider trading, even though you did not trade and did not
gain any benefit from another’s trading. No Exception for Hardship. The existence of a personal financial emergency does not excuse you from compliance with this policy.

Pre-Clearance Requirement. To help prevent inadvertent violations of the federal securities laws and to avoid even the appearance of trading on the basis of inside information, all officers, directors, employees and consultants of the Company must contact our Chief Financial Officer (or our Chief Executive Officer in the case of our Chief Financial Officer) to obtain “preclearance” at any time prior to trading in Company securities.

Blackout Periods. In addition to having to pre-clear all trading in Company securities, all officers, directors, employees and consultants of the Company may not trade in Company securities during quarterly blackout periods beginning 15 days before the end of each fiscal quarter and fiscal year and ending after the second full business day following the release of the Company’s applicable quarterly and annual earnings and during certain event-specific blackouts.

Exception for Approved 10b5-1 Plans. Trades by directors or executive officers in Company securities that are executed pursuant to an approved 10b5-1 plan are not subject to the prohibition on trading on the basis of material nonpublic information contained in this Insider Trading Policy or to the restrictions set forth above relating to pre-clearance procedures and
blackout periods.

Rule l0b5-l provides an affirmative defense from insider trading liability under the federal securities laws for trading plans that meet certain requirements. In general, a 10b5-l plan must be entered into by a director or executive officer before such individual is aware of material nonpublic information. Once the plan is adopted, such individual must not exercise any
influence over the amount of securities to be traded, the price at which they are to be traded or the date of the trade. The plan must either specify (including by formula) the amount, pricing and timing of transactions in advance or delegate discretion on those matters to an independent third party.

The Company requires that all 10b5-1 plans be approved in writing in advance by the Company’s outside securities counsel. 10b5-l plans generally may not be adopted during a blackout period and may only be adopted before the individual adopting the plan is aware of material nonpublic information.

Director and Executive Officer Special Obligations and Notification Requirement. Directors and executive officers of the Company must also comply with the reporting obligations and limitations of “short-swing” transactions imposed by federal securities laws. These laws require such individuals to report their transactions in Company securities to the SEC within two (2) business days from the execution date and prohibit “matching” purchases and sales of Company securities within a six-month period. Additional information on these obligations is provided separately to individuals who are subject to them and any questions should be directed to our outside securities counsel. Directors and executive officers of the Company must notify, orally or in writing, our Chief Financial Officer (or our Chief Executive Officer in the case of the Chief Financial Officer), of each trade of Company securities no later than one day after effecting such trade.

5. Definition of Material Nonpublic Information

Note that inside information has two important elements – materiality and public availability. Material Information. Information is material if there is a substantial likelihood that a reasonable investor would consider it important in deciding whether to buy, hold or sell a security. Any information that could reasonably be expected to affect the price of the security is material. Common examples of material information pertaining to the Company are:

– Financial results and financial forecasts or changes therein.
– Sales and revenue levels.
– Earnings that are inconsistent with the consensus expectations of the investment community.
– A pending or proposed merger, acquisition or tender offer or an acquisition or disposition of
significant assets.
– Changes in senior management or the board of directors.
– Major events regarding the Company’s securities, including the declaration of a stock split or
dividend or the offering of additional securities.
– Significant strategic relationships.
– Severe financial liquidity problems.
– Significant new products.
– Actual or threatened major litigation, or the resolution of such litigation.
– New major contracts, orders, suppliers, customers or finance sources, or the loss thereof.

Both positive and negative information can be material. Because trading that receives scrutiny will be evaluated after the fact with the benefit of hindsight, questions concerning the materiality of particular information should be resolved in favor of materiality, and trading should be avoided.

Nonpublic Information. Nonpublic information is information that is not generally known or available to the public. One common misconception is that material information loses its “nonpublic” status as soon as a press release is issued disclosing the information. In fact, information is considered to be available to the public only when it has been released broadly to the marketplace (such as by a press release or a SEC filing) and the investing public has had time to absorb the information fully. As a general rule, information is considered nonpublic until completion of the second full trading day after the information is released. For example, if the Company announces financial earnings before trading begins on a Tuesday, the first time you can buy or sell Company securities is the opening of the market on Thursday (assuming you are not aware of other material nonpublic information at that time). However, if the Company announces earnings after trading begins on that Tuesday, the first time you can buy or sell Company securities is the opening of the market on Friday.

6. Additional Guidance

The Company considers it improper and inappropriate for those employed by or associated with the Company to engage in short term or speculative transactions in Company securities or in other transactions in Company securities that may lead to inadvertent violations of the insider trading laws. Accordingly, your trading in Company securities is subject to the following
additional guidance.

Short Sales. You may not engage in short sales of the Company’s securities (sales of securities that are not then owned), including a “sale against the box” (a sale with delayed delivery), provided that the establishment of certain short positions as described below under “Hedging Transactions” may be permissible in certain instances.

Hedging Transactions. Certain forms of hedging or monetization transactions, such as zero-cost collars and forward sale contracts, involve the establishment of a short position in Company securities and limit or eliminate your ability to profit from an increase in the value of Company securities. Such transactions are complex and involve many aspects of the federal securities laws, including filing and disclosure requirements. Therefore, the Company requires that if you wish to enter into such an arrangement, you must first pre-clear the proposed transaction with the Company’s outside securities counsel. Any request for pre-clearance must be submitted at least two weeks prior to the proposed execution of documents evidencing the proposed
transaction.

Publicly Traded Options. You may not engage in transactions in publicly traded options, such as puts, calls and other derivative securities, on an exchange or in any other organized market. Standing Orders. Standing orders should be used only for a very brief period of time. A standing order placed with a broker to sell or purchase stock at a specified price leaves you with no control over the timing of the transaction. A standing order transaction executed by the broker when you are aware of material nonpublic information may result in unlawful insider trading.

Margin Accounts and Pledges. Securities held in a margin account or pledged as collateral for a loan may be sold without your consent by the broker if you fail to meet a margin call or by the lender in foreclosure if you default on the loan. A margin or foreclosure sale that occurs when you are aware of material nonpublic information may, under some circumstances, result in
unlawful insider trading. Because a margin or foreclosure sale may occur at a time when you are aware of material nonpublic information or otherwise are not permitted to trade in Company securities, you are prohibited from holding Company securities in a margin account or pledging Company securities as collateral for a loan. An exception to this prohibition may be granted where you wish to pledge Company securities as collateral for a loan (not including margin debt) and clearly demonstrate the financial capacity to repay the loan without resort to the pledged securities. If you wish to pledge Company securities as collateral for a loan, you must submit a request for approval to the Company’s outside securities counsel at least two
weeks prior to the proposed execution of documents evidencing the proposed pledge.

7. Post-Termination Transactions

This policy continues to apply to your transactions in Company securities even after you have terminated employment or other services to the Company or a subsidiary as follows: if you are aware of material nonpublic information when your employment or relationship terminates, you may not trade in Company securities until that information has become public or is no longer material. Former directors and executive officers of the Company, however, must comply with this policy for three (3) months after their relationship with the Company terminates.

8. Unauthorized Disclosure

As discussed above, the disclosure of material nonpublic information to others can lead to significant legal problems and legal consequences. Therefore, you should not discuss material, nonpublic information about the Company with anyone, including other Company personnel, except as required in the performance of your regular duties.

In addition, the SEC has also enacted rules explicitly banning selective disclosure. Generally, when a public company (such as RELM) discloses material nonpublic information, it must provide, non-selective public access to the information. Violations of these rules can result in SEC enforcement actions, potentially resulting in injunctions and severe monetary penalties. Due to these and other considerations, only members of senior management are authorized to communicate with the media, securities market professionals (such as financial analysts), investors or the Company’s shareholders. All inquiries from such persons should be directed to the Company’s Chief Financial Officer, or if he is unavailable, to our Chief Executive Officer. Furthermore, maintaining the confidentiality of Company information is essential for competitive, security and other business reasons.

9. Personal Responsibility

You should remember that the ultimate responsibility for adhering to this Insider Trading Policy and avoiding improper trading rests with you. If you violate this Insider Trading Policy, the Company may take disciplinary action, including dismissal for cause.

10. Company Assistance

Your compliance with this Insider Trading Policy is of the utmost importance both for you and for the Company. If you have any questions about this Insider Trading Policy or its application to any proposed transaction, you may obtain additional guidance from the Company’s Chief

Financial Officer. Do not try to resolve uncertainties on your own, as the rules relating to insider trading are often complex, not always intuitive and carry severe consequences.

11. Certification

All directors, executive officers, employees and consultants of the Company must certify their understanding of, and intent to comply with, this Insider Trading Policy. A copy of the certification that you must sign is enclosed with this Insider Trading Policy. Please note that you are bound by this Insider Trading Policy whether or not you sign the certification. This Insider Trading Policy is amended and restated effective January 17, 2006 and supersedes any previous policy of the Company concerning insider trading.