Code of Ethics
This Code of Ethics and Business Conduct (this Code) covers a wide range of business practices and procedures. It does not cover every issue that may arise, but it sets out basic principles to guide all officers, employees and directors of Affinity Gold Corp. (the Company or we) and its subsidiaries. All of our officers, employees and directors must conduct themselves accordingly and seek to avoid even the appearance of improper behavior. Hereinafter, our use of the term employees in this Code includes all officers (whether or not they are employees of the Company or its subsidiaries), employees of the Company and its subsidiaries, and all non-employee directors of the Company and its subsidiaries; and our use of the term Company includes all subsidiaries of the Company. Further, the Companys chief executive officer and its senior financial officers are also subject to the Code of Ethics for CEO and Senior Financial Officers, which is attached as Appendix A.
If a law conflicts with a policy contained in this Code, you must comply with the law. If you have any questions about these conflicts, you should ask your supervisor how to handle the situation.Those who violate the standards in this Code will be subject to disciplinary action, up to and including termination of employment. If you are in a situation which you believe may violate or lead to a violation of this Code, follow the guidelines described in Section 14 of this Code.
1. Compliance with Laws, Rules and Regulations
Obeying the law, both in letter and in spirit, is the foundation on which this Companys ethical standards are built. All employees must respect and obey the laws of the cities, states and countries in which we operate. Although not all employees are expected to know the details of these laws, it is important to know enough to determine when to seek advice from supervisors, managers or other appropriate personnel. If reasonably requested, the Company will hold information and training sessions to promote compliance with laws, rules and regulations, including insider trading laws.
2. Conflicts of Interest
A conflict of interest exists when a persons private interest interferes in any way with the interests of the Company. A conflict situation can arise when an employee takes actions or has interests that may make it difficult to perform his or her Company work objectively and effectively. Conflicts of interest may also arise when an employee, or members of his or her family, receives improper personal benefits as a result of his or her position in the Company. For example, loans to, or guarantees of obligations of, employees and their family members may create conflicts of interest.
It is almost always a conflict of interest for a Company employee to work simultaneously for a competitor, customer or supplier. You are not allowed to work for a competitor as a consultant or board member. The best policy is to avoid any direct or indirect business connection with our customers, suppliers or competitors, except when doing so on our behalf.
Conflicts of interest are prohibited as a matter of Company policy, except under guidelines approved by our board of directors. Conflicts of interest may not always be clear-cut, so if you have a question, you should consult with your supervisor or the board of directors. Any employee, officer or director who becomes aware of a conflict or potential conflict should bring it to the attention of a supervisor, manager or other appropriate personnel or consult the procedures described in Section 13 of this Code.
3. Corporate Opportunities
Employees are prohibited from taking for themselves personally opportunities that are discovered through the use of corporate property, information or position without the express consent of our board of directors. No employee may use corporate property, information, or position for improper personal gain, and no employee may compete with the Company directly or indirectly. Employees, officers and directors owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises.
4. Competition and Fair Dealing
We seek to outperform our competition fairly and honestly. Stealing proprietary information, possessing trade secret information that was obtained without the owners consent, or inducing such disclosures by past or present employees of other companies is prohibited.
Each employee should endeavor to respect the rights of and deal fairly with the Companys customers, suppliers, competitors and other employees. No employee should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other intentional unfair-dealing practice.
The purpose of business entertainment and gifts in a commercial setting is to create goodwill and sound working relationships, not to gain unfair advantage with customers. No gift or entertainment should ever be offered, given, provided or accepted by any Company employee, or family member of an employee, unless it: (1) is not a cash gift, (2) is consistent with customary business practices, (3) is not excessive in value, (4) cannot be construed as a bribe or payoff and (5) does not violate any laws or regulations. Please discuss with your supervisor any gifts or proposed gifts which you are not certain are appropriate.5. Discrimination and Harassment
The board of directors believes that the diversity of the Companys employees is a tremendous asset. We are firmly committed to providing equal opportunity in all aspects of employment and will not tolerate any illegal discrimination or harassment of any kind. Examples include derogatory comments based on racial or ethnic characteristics and unwelcome sexual advances.
6. Health and Safety
The Company strives to provide each employee with a safe and healthy work environment. Each employee has responsibility for maintaining a safe and healthy workplace for all employees by following safety and health rules and practices and reporting accidents, injuries and unsafe equipment, practices or conditions. Violence and threatening behavior are not permitted. Employees should report to work in condition to perform their duties, free from the influence of illegal drugs or alcohol. The use of illegal drugs or alcohol in the workplace will not be tolerated.
The Company requires honest and accurate recording and reporting of information in order to make responsible business decisions. For example, for hourly employees, only the true and actual number of hours worked should be reported.
Many employees regularly use business expense accounts, which must be documented and recorded accurately. If you are not sure whether a certain expense is legitimate, ask your supervisor.
All of the Companys books, records, accounts and financial statements must be maintained in reasonable detail, must appropriately reflect the Companys transactions and must conform both to applicable legal requirements and to the Companys system of internal controls. Unrecorded or off the books funds or assets should not be maintained unless permitted by applicable law or regulation.
Business records and communications often become public, and we should avoid exaggeration, derogatory remarks, guesswork, or inappropriate characterizations of people and companies that can be misunderstood. This applies equally to e-mail, internal memos, and formal reports. Records should always be retained or destroyed according to the Companys record-retention policies. In accordance with those policies, in the event of litigation or governmental investigation please consult the Companys chief financial or chief executive officer.
Employees must maintain the confidentiality of confidential information entrusted to them by the Company or its customers, except when disclosure is authorized by an executive officer of the Company or required by laws or regulations. Confidential information includes all nonpublic information that might be of use to competitors, or harmful to the Company or its customers, if disclosed. It also includes information that suppliers and customers have entrusted to us. The obligation to preserve confidential information continues even after employment ends.
9. Protection and Proper Use of Company Assets
All employees should endeavor to protect the Companys assets and ensure their efficient use. Theft, carelessness, and waste have a direct impact on the Companys profitability. Any suspected incident of fraud or theft should be immediately reported for investigation. Company equipment should not be used for non-Company business, though incidental personal use may be permitted. The obligation of employees to protect the Companys assets includes its proprietary information. Proprietary information includes intellectual property such as trade secrets, patents, trademarks, and copyrights, as well as business, marketing and service plans, engineering and manufacturing ideas, designs, databases, records, salary information and any unpublished financial data and reports. Unauthorized use or distribution of this information would violate Company policy. It could also be illegal and may result in civil or even criminal penalties.
10. Payments to Government Personnel
The U.S. Foreign Corrupt Practices Act prohibits giving anything of value, directly or indirectly, to officials of foreign governments or foreign political candidates in order to obtain or retain business. It is strictly prohibited to make illegal payments to government officials of any country.
In addition, the U.S. government has a number of laws and regulations regarding business gratuities which may be accepted by U.S. government personnel. The promise, offer or delivery to an official or employee of the U.S. government of a gift, favor or other gratuity in violation of these rules would not only violate Company policy but could also be a criminal offense. State and local governments, as well as foreign governments, may have similar rules. The Companys chief financial or chief executive officer can provide guidance to you in this area.
11. Waivers of the Code of Ethics and Business Conduct
Any waiver of this Code for executive officers or directors may be granted only by our board of directors and will be promptly disclosed as required by law or applicable stock exchange or listing regulations.
12. Reporting Illegal or Unethical Behavior
Employees are encouraged to talk to supervisors, managers or other appropriate personnel about observed illegal or unethical behavior and when in doubt about the best course of action in a particular situation. It is the policy of the Company not to allow retaliation for reports of misconduct by others made in good faith by employees. Employees are expected to cooperate in internal investigations of misconduct. In addition, any employee may submit a good faith concern regarding questionable accounting or auditing matters, without fear of dismissal or retaliation of any kind, to either the chief financial officer, chief executive officer or audit committee chairperson or chairperson of our board of directors.
13. Compliance Procedures
We must all work to ensure prompt and consistent action against violations of this Code. Nevertheless, in some situations it is difficult to know if a violation has occurred. Since we cannot anticipate every situation that will arise, it is important that we have a way to approach a new question or problem. These are the steps to keep in mind:
Make sure you have all the facts. In order to reach the right solution, we must be as fully informed as possible.
Ask yourself: What specifically am I being asked to do? Does it seem unethical or improper? This will enable you to focus on the specific question you are faced with, and the alternatives you have. Use your judgment and common sense; if something seems unethical or improper, it probably is.
Clarify your responsibility and role. In most situations, there is shared responsibility. Are your colleagues informed? It may help to get others involved and discuss the problem.
Discuss the problem with your supervisor. This is the basic guidance for all situations. In many cases, your supervisor will be more knowledgeable about the question, and will appreciate being brought into the decision-making process. Remember that it is your supervisors responsibility to help solve problems.
Seek help from Company resources. In the rare case where it may not be appropriate to discuss an issue with your supervisor, or where you do not feel comfortable approaching your supervisor with your question, you should contact our chief financial or chief executive officer.
You may report ethical violations in confidence and without fear of retaliation. If your situation requires that your identity be kept secret, your anonymity will be protected. The Company does not permit retaliation of any kind against employees for good faith reports of ethical violations.
Always ask first, act later. If you are unsure of what to do in any situation, seek guidance before you act.
CODE OF ETHICS FOR CEO AND SENIOR FINANCIAL OFFICERS
The Company has a Code of Ethics and Business Conduct applicable to all officers, employees and directors of the Company and its subsidiaries. The CEO and all senior financial officers are bound by the provisions set forth therein relating to ethical conduct, conflicts of interest, and compliance with law. In addition to that Code of Ethics and Business Conduct, the CEO and senior financial officers are also subject to the following specific policies:
1. The CEO and all senior financial officers are responsible for full, fair, accurate, timely and understandable disclosure in the periodic reports required to be filed by the Company with the United States Securities and Exchange Commission (SEC). Accordingly, it is the responsibility of the CEO and each senior financial officer promptly to bring to the attention of the board of directors any material information of which he or she may become aware that affects the truth or accuracy of the disclosures made by the Company in its public filings.
2. The CEO and each senior financial officer shall promptly bring to the attention of the audit committee of the board of directors (or the entire board of directors in the event that the board of directors does not have an audit committee) any information he or she may have concerning (i) significant deficiencies in the design or operation of internal controls which could adversely affect the Companys ability to record, process, summarize and report financial data or (ii) any fraud, whether or not material, that involves management or other employees who have a significant role in the Companys financial reporting, disclosures or internal controls.
3. The CEO and each senior financial officer shall promptly bring to the attention of the audit committee of the board of directors any information he or she may have concerning any violation of the Companys Code of Ethics and Business Conduct, including any actual or apparent conflicts of interest between personal and professional relationships, involving any management or other employees who have a significant role in the Companys financial reporting, disclosures or internal controls.
4. The CEO and each senior financial officer shall promptly bring to the attention of the audit committee of the board of directors (or the entire board of directors in the event that the board of directors does not have an audit committee) any information he or she may have concerning credible evidence of (i) a material violation of U.S. federal or state securities or other laws, rules or regulations applicable to the Company and the operation of its business, by the Company or any agent thereof, (ii) a violation of the Code of Ethics and Business Conduct, or (iii) a violation of these additional procedures.