Effective: May 4, 2004


The primary purpose of the Audit Committee is to assist the Board of Directors in fulfilling its oversight

responsibilities for management's conduct of the Company's accounting and financial reporting processes

and the Company's system of internal controls regarding finance, accounting, legal compliance and ethics.


A. Independence/Composition. The Audit Committee shall be comprised of not less than three (3)

members of the Board of Directors. Each member of the Audit Committee shall meet independence and

experience requirements of NASDAQ, the Securities Exchange Act of 1934, as amended, and the rules

and regulations of the Securities and Exchange Commission (the "Commission"). Accordingly, the

members of the Audit Committee will consist of directors:

None of whom has any relationship to the Company that would interfere with the exercise of his or her

independent judgment as a member of the Audit Committee; and

All of whom, as determined by the Board of Directors in its business judgment, are financially literate

and have a working familiarity with basic financial and accounting practices and at least one member

of the Audit Committee shall be an "audit committee financial expert" in compliance with the criteria

established by the Commission.

B. Appointment. The members of the Audit Committee shall be nominated by the Nominating and

Governance Committee and appointed annually to one year terms by the Board of Directors. The

Nominating and Governance Committee shall recommend, and the Board shall designate, one member of

the Audit Committee as chair. Audit Committee members may be replaced by the Board.


A. Schedule. The Audit Committee shall hold regular meetings at least quarterly each fiscal year.

The meeting schedule shall include sessions with management and the independent auditor. Each

regularly scheduled meeting of the Audit Committee shall, however, conclude with an executive session of

the Audit Committee, absent members of management and on such terms and conditions as the Audit

Committee may elect. Special meetings of the Audit Committee may be called pursuant to any procedures

established by the Audit Committee. Pre-meeting materials are expected to be distributed to Audit

Committee members in sufficient time prior to meetings to permit review by members before such


B. Minutes. The Audit Committee shall keep written minutes of its meetings, which shall include a

description of all actions taken by the Committee. The minutes shall be distributed to all members of the

Board of Directors and shall be maintained with the books and records of the Company.


The Company's management is responsible for preparing the Company's financial statements, and the

independent auditor is responsible for auditing the Company's financial statements. The Company's

financial management, including the independent auditor, have more time, knowledge and more detailed

information of the Company than does the Audit Committee. Consequently, the Audit Committee's role is

one of oversight and does not provide any expert assurance or certification as to the Company's financial

statements or the work of the independent auditor.

The following functions are the common recurring activities of the Audit Committee in carrying out its

oversight function:

A. Document And Report Review

1. Review, assess the adequacy of, and update this Charter at least annually or as

conditions dictate.

2. Review and discuss with management the Company's annual financial statements and

any reports or other financial information submitted to the SEC or to the public, including

any report issued by the independent auditor, and including matters required to be

reviewed under applicable legal, regulatory, or NASDAQ requirements.

3. Recommend to the Board of Directors whether the financial statements should be

included in the Annual Report on Form 10-K.

4. Review and discuss with management and the independent auditor the quarterly report

on Form 10-Q and the annual report on Form 10-K prior to its filing, including matters

required to be reviewed under applicable legal, regulatory, or NASDAQ requirements.

5. Discuss with management earnings press releases prior to dissemination, and financial

information and earnings guidance provided to analysts and rating agencies.

B. Independent Auditors

1. Select and appoint, determine the compensation of and funding for, evaluate, and provide

oversight of the Company's independent auditor, including the removal of the Company's

independent auditor, all within the Audit Committee's sole authority. The independent

auditor shall report and be accountable directly to the Audit Committee, and the Audit

Committee shall oversee the resolution of any disagreements between management and

the independent auditor.

2. On an annual basis, review and discuss with the independent auditor all significant

relationships the auditor has with the Company to determine the auditor's objectivity and

independence, and the absence of conflict of interest undertaking or recommending

appropriate action to ensure and continue that independence.

3. Assure regular rotation of the lead audit partner as required by the rules and regulations

of the Commission and applicable law.

4. Implement and administer the Company's Policy Regarding the Approval of Audit and

Permissible Nonaudit Services Provided by the Independent Auditor.

5. Review the independent auditor's attestation and report on management's internal control

report, and hold timely discussions with the independent auditor regarding the content of

that attestation and report.

6. At least annually, obtain and review a report by the independent auditor regarding:

(a) The firm's internal quality control procedures;

(b) Any material issues raised by the most recent internal quality-control review, 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, and any steps taken to deal with any

such issues; and

(c) All relationships between the independent auditor and its related entities and the

Company and its related entities (with a confirmation that in the professional

judgment the auditor is independent of the Company under all applicable laws,

rules, and regulations).

C. Financial Reporting Processes

1. Review the integrity of the Company's financial reporting process, both internal and

external, giving consideration to consultation with management and the independent


2. Review the Company's critical accounting policies and practices as well as consider and

approve, as appropriate, any material changes to the Company's accounting policies and

practices as suggested by the independent auditor and management.

3. Review and approve all related party transactions.

4. Establish and maintain procedures for the receipt, retention and treatment of complaints

regarding accounting, internal accounting controls, or auditing matters, including procedures

necessary to receive and respond to confidential and anonymous submissions by Company

employees regarding questionable accounting or auditing matters.

5. Review reports required to be submitted by the independent auditor concerning: (a) all critical

accounting policies and practices used; (b) all alternative treatments of financial information

within GAAP that have been discussed with management, the ramifications of such

alternatives, and the accounting treatment preferred by the independent auditors; and (c) any

other material written communications with management

D. Internal Audit

1. Evaluate on an annual basis the necessity (with input from management and the

independent auditor) of an internal audit function. If an internal audit function is

established, the Committee will oversee its activities including its organization, objectivity,

responsibilities, plans, budgets, and staffing.

E. Ethical and Legal Compliance

1. Review the Company's Code of Conduct, when and as approved by the Board of

Directors, to ensure that management has maintained a system to comply with expected

ethical and legal requirements.

2. Review, with the Company's counsel, legal compliance matters including corporate

securities trading policies.

3. Review, with the Company's counsel, any legal matter that could have a significant impact

on the Company's financial statements.

4. Discuss the Company's risk assessment and risk management, any steps taken by

management to control or mitigate risk exposure, as well as any audit problems or

difficulties and management's response.

F. Other

1. Prepare the Audit Committee report, in accordance with all applicable rules and

regulations, to be included in the Company's annual proxy statement to shareholders.

2. Perform an annual self-assessment relative to the Audit Committee's purpose, duties and

responsibilities set forth in this Charter.

3. Obtain advice and assistance from outside legal, accounting or other advisors as deemed

appropriate to perform Committee duties and responsibilities. The Audit Committee has

the sole authority to retain and determine the funding for such advisors and shall be given

the necessary resources to retain such advisors and to otherwise fulfill its functions as set

forth in this Charter.

4. Perform any other activities consistent with this Charter, the Company's Bylaws and

governing law, as the Audit Committee or the Board of Directors deems necessary or



While the Audit Committee has the responsibilities and powers set forth in this Charter, it is not the duty of

the Audit Committee to plan or conduct audits or to determine if the Company's financial statements and

disclosures are complete and accurate and are in accordance with generally accepted accounting

principles and applicable rules and regulations. These are the responsibilities of management and the

independent auditor.