VERDISYS,INC. 

CODE OF ETHICS FOR SENIOR OFFICERS

PREFACE

Senior officers such as the principal executive officer, principalfinancial officer, principal accounting officer and persons performing similar functions(“Senior Officers”) hold an important and elevated role in corporate governance.They are vested with both the responsibility and authority to protect, balance, andpreserve the interests of all of the Company’s stakeholders, including stockholders,clients, employees, suppliers, and citizens of the communities in which business isconducted. Senior Officers fulfill this responsibility by prescribing and enforcing thepolicies and procedures employed in the operation of the Company’s financialorganization, and by demonstrating the following:

I. HONEST AND ETHICAL CONDUCT

Senior Officers will exhibit and promote the highest standards ofhonest and ethical conduct through the establishment and operation of policies andprocedures that: 

Encourage and reward professional integrity in all aspects of thefinancial organization, by eliminating inhibitions and barriers to responsible behavior,such as coercion, fear of reprisal, or alienation from the financial organization or theenterprise itself. 

Prohibit and eliminate the appearance or occurrence of conflictsbetween what is in the best interest of the enterprise and what could result in materialpersonal gain for a member of the organization, including Senior Officers.

Company directors, officers and employees have an obligation topromote the best interests of the Company at all times. They should avoid any action whichmay involve a conflict of interest with the Company. Directors, officers and employeesshould not have any undisclosed, unapproved financial or other business relationships withsuppliers, customers or competitors that might impair the independence of any judgmentthey may need to make on behalf of the Company. Conflicts of interest would also arise ifa director, officer or employee, or a member of his or her family, receives improperpersonal benefits as a result of his or her position in the Company.

Where conflicts of interest arise, directors, officers and employeesmust provide full disclosure of the circumstances and abstain from any related decisionmaking process.

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Directors, officers and employees must also avoid apparent conflictsof interest, which occur where a reasonable observer might assume there is a conflict ofinterest and, therefore, a loss of objectivity in their dealings on behalf of the Company.

Provide a mechanism for members of the finance organization toinform senior management of deviations in practice from policies and procedures governinghonest and ethical behavior.

If any employee has knowledge or is suspicious of non-compliancewith any provision of this Code or is concerned whether circumstances could lead to aviolation of this Code, he or she should discuss the situation with one or more members ofthe Audit Committee or in the absence of an Audit Committee with the Company’s Boardof Directors. The Company will not allow any retaliation against a director, officer oremployee who acts in good faith in reporting any such violation or suspected violation.

If directors or executive officers have knowledge or are suspiciousof any non-compliance with any provision of this Code or are concerned whethercircumstances could lead to a violation of this Code, they should discuss the situationwith the Audit Committee or in the absence of an Audit Committee with the Board ofDirectors of the Company.

Demonstrate their personal support for such policies and proceduresthrough periodic communication reinforcing these ethical standards throughout the Company.

II. FINANCIAL RECORDS AND PERIODIC REPORTS

Senior Officers will establish and manage the Company’stransaction and reporting systems and procedures to ensure that: 

The Company complies with its obligations to disclose all materialinformation in accordance with all applicable securities laws.

All employees comply with the Company’s Internal DisclosureControls and Procedures Guidelines and all other financial and disclosure controls andprocedures.

Business transactions are properly authorized and completely andaccurately recorded on the Company’s books and records in accordance with GenerallyAccepted Accounting Principles (GAAP) and established Company financial policy.

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The retention or proper disposal of Company records shall be inaccordance with established Company financial policies and applicable legal and regulatoryrequirements.

Periodic financial communications and reports will be delivered in amanner that facilitates the highest degree of clarity of content and meaning so thatreaders and users will quickly and accurately determine their significance andconsequence.

Any Senior Officer in possession of material information must notdisclose such information before its public disclosure and must take steps to ensure thatthe Company complies with its timely disclosure obligations.

III. COMPLIANCE WITH APPLICABLE LAWS, RULES AND REGULATIONS

Senior Officers will establish and maintain mechanisms to:

Educate appropriate employees of the Company about any federal,state or local statute, regulation or administrative procedure that affects the operationof the finance and accounting organization and the Company generally.

Monitor the compliance of the Company with any applicable federal,state or local statute, regulation or administrative rule.

Identify, report and correct in a swift and certain manner, anydetected deviations from applicable federal, state or local stature or regulation.

If a law conflicts with a provision of this Code, Senior Officersmust comply with the law; however, if a local custom or policy conflicts with a provisionof this Code, Senior Officers must comply with the Code.

IV. ACCOUNTABILITY FOR ADHERENCE TO THE CODE

All directors and Senior Officers are responsible for abiding bythis Code. This includes individuals responsible for the failure to exercise propersupervision and to detect and report a violation by their subordinates. Discipline may,when appropriate, include dismissal.

V. AMENDMENTS AND WAIVERS

This Code of Ethics may be amended, and compliance with it may bewaived, only with the approval of the Audit Committee or in the absence of an AuditCommittee by the Board of Directors.

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