This Code of Ethics (this “Code“) is applicable to all employees and members of the Board of Directors of Capital City Energy Group, Inc. (“Capital City” or “Company“). References in this Code of Ethics to Capital City mean Capital City or any of its subsidiaries.
While Capital City and its stockholders expect honest and ethical conduct in all aspects of its business from all employees, Capital City and its stockholders expect the highest possible standards of honest and ethical conduct from its officers and members of its Board of Directors. The officers and members of its Board of Directors are setting an example for other employees and are expected to foster a culture of transparency, integrity and honesty. The Company will never tolerate unethical or unlawful business conduct or behavior. In certain circumstances, the appearance of impropriety can be just as damaging to the Company as actual impropriety. Consequently, the appearance of impropriety will not be tolerated.
This Code of Ethics and Business Conduct identifies the broad principles of legal and ethical business conduct endorsed by the Company. It is not an exhaustive list of legal or ethical principles or issues which might confront our representatives. We expect the use of good judgment in all aspects of Company business, and this Code should be applied using common sense and judgment to the extent a specific fact pattern or scenario is not expressly discussed in this Code. The employees should consult with their supervisor if they are unclear as to the application of this Code under a particular set of circumstances. Compliance with this Code and all other applicable codes of business conduct or ethics adopted by the Board of Directors of Capital City is mandatory and any violations will be addressed severely.
Every employee is responsible for his or her own actions with respect to proper conduct and behavior. Proper business and ethical conduct are fundamental conditions of employment. In addition, any employee regardless of position, title or grade, who observes or becomes aware of unethical or unlawful activity, should report such activity immediately to the Vice President of Administration or the Audit Committee of the Board of Directors.
II. CONFLICTS OF INTEREST
Conflicts of interest are strictly prohibited as a matter of Capital City policy. Officers must be scrupulous in avoiding any action or interest that conflicts with, or gives the appearance of a conflict with, Capital City’s interests. A “conflict of interest” exists whenever an individual’s private interests in any way interfere or conflict with, or appear to interfere or conflict with, the interests of Capital City or make, or appear to make, it difficult for the individual to perform his or her work for Capital City objectively and effectively. Conflicts of interest arise when:
personal interests interfere, or appear to interfere, in any way, with the interests of Capital City (for example, competition with Capital City);
undertakings for an officer’s direct or indirect benefit or the direct or indirect benefit of a third party that is inconsistent with the interests of Capital City (for example, causing Capital City to engage in business transactions with a company under the control of an officer, whether solely or with friends or relatives); or
an officer, or a member of an officer’s family, receives improper personal benefits as a result of such officer’s position in Capital City (for example, a loan or other benefit from a third party to direct Capital City business to a third-party).
There are other situations in which conflicts of interest may arise. Conflicts of interest may not always be clear-cut. Questions regarding conflicts of interest should be directed to the Vice President of Administration or the Company’s outside counsel.
Each employee is expected to abide by the spirit as well as the letter of this policy, because this policy is, by necessity, general. Each employee is also expected to cooperate with any inquiries or investigations concerning a possible or suspected violation of this policy.
Gifts and Gratuities
While employed at the Company, each employee must conduct their business and personal life in strict compliance with all applicable laws and regulations. It is against the policy of the Company for an employee to attempt to influence favorably the purchase of the Company’s services or obtain special favors by making payments or giving consideration to customers, governmental employees, or others. Gifts and entertainment may be given to others only if they meet all of the following criteria:
The value of gifts or entertainment must not exceed common courtesies usually associated with business practice, and must be of such limited value as not to be construed as a bribe or payoff;
They must not be in violation of any applicable law, regulation or accepted ethical standard, or of such a nature that the public disclosure of the gifts or entertainment would reflect unfavorably on the Company; and
Each employee should keep specific records to demonstrate to the Company that they have not exceeded these limits.
Each employee is forbidden from seeking, soliciting, or accepting any payment or fee from any supplier or vendor that does business with or is a competitor of the Company. Any gifts or gratuities received by the employee or any member of their immediate family from suppliers must be of such minimal value and infrequency that they could not reasonably be construed as bribes, payoffs, or rebates.
Participation in Community Affairs
The Company believes that it is important for citizens to participate in political and government processes. Unless approved by an officer, whatever each employee undertakes must be in their role as a private citizen and not as a representative of the Company. Furthermore, unless approved by an officer of the Company, any such involvement should be conducted on each employee’s own time, not the Company’s, and with the aid of their personal resources, not the Company’s.
No employee of the Company may serve as the director or officer of any other for-profit or not-for-profit business or entity, except in exceptional circumstances and upon written approval by the President of the Company. This restriction is required because of the liability problems raised by such affiliation. As a preliminary matter, any such outside business organization must have obtained directors’ and officers’ liability insurance, and undertaken meaningful corporate action to indemnify board members.
III. ACCURATE PERIODIC REPORTS
Full, fair, accurate, timely and understandable disclosure (as required in the reports and other documents that filed with, or submitted to, the SEC and in our other public communications) is critical for the Company to maintain its good reputation, to comply with its obligations under the securities laws and to meet the expectations of our stockholders and other members of the investment community. Officers are to exercise the highest standard of care in preparing such reports and documents and other public communications, in accordance with the following guidelines:
all accounting records, and the reports produced from such records, must be in accordance with all applicable laws and regulations;
all accounting records must fairly and accurately reflect the transactions or occurrences to which they relate;
all accounting records must fairly and accurately reflect in reasonable detail Capital City’s assets, liabilities, revenues and expenses;
no accounting records may contain any false or intentionally misleading entries;
no transactions should be intentionally misclassified as to accounts, departments or accounting periods;
all transactions must be supported by accurate documentation in reasonable detail and recorded in the proper account and in the proper accounting period; and
no material information should be concealed from the internal auditors or the independent auditors; and compliance with Capital City’s system of internal controls is required.
IV. COMPLIANCE WITH LAWS
All employees are expected to understand and comply with both the letter and spirit of all applicable laws and governmental rules and regulations.
V. SPECIAL OBLIGATIONS FOR FINANCIAL REPORTING EMPLOYEES
As a public company it is critical that the Company’s filings with the Securities and Exchange Commission be accurate and timely. Employees may be called upon to provide information to assure that the Company’s public reports are complete, fair and understandable. The Company expects all of its personnel to take this responsibility very seriously and to provide prompt and accurate answers to inquiries related to the Company’s public disclosure requirements.
The Finance Department bears a special responsibility for promoting integrity throughout the organization, with responsibilities to stakeholders both inside and outside of the Company. The Chief Executive Officer and Finance Department personnel have a special role both to adhere to these principles themselves and also to ensure that a culture exists throughout the Company as a whole that ensures the fair and timely reporting of our financial results and condition.
Because of this special role, the Chief Executive Officer and all members of the Finance Department are bound by the following Financial Officer Code of Ethics, and by accepting the Code of Ethics and Business Conduct, each agrees that he or she will:
Act with honesty and integrity, avoiding actual or apparent conflicts of interest in personal and professional relationships.
Provide information that is accurate, complete, objective, relevant, timely and understandable to ensure full, fair, accurate, timely, and understandable disclosure in reports and documents that the Company files with, or submits to, government agencies and in other public communications.
Comply with rules and regulations of federal, state and local governments, and other appropriate private and public regulatory agencies.
Act in good faith, responsibly, with due care, competence and diligence, to not misrepresent material facts or allow independent judgment to be compromised.
Respect the confidentiality of information except when authorized or otherwise legally obligated to disclose. Confidential information acquired in the course of one’s work will not be used for personal advantage.
Promote and be an example of ethical behavior as a responsible partner among peers in the work environment.
Achieve responsible use of and control over all assets and resources employed or entrusted.
Promptly report to the Chief Financial Officer and/or the Chairman of the Audit Committee of the Board of Directors any conduct that the individual believes to be a violation of law or business ethics or of any provision of this Code of Ethics and Business Conduct, including any transaction or relationship that reasonably could be expected to give rise to such a conflict.
Violations of this Financial Officer Code of Ethics, including failures to report potential violations by others, will be viewed as a severe disciplinary matter that may result in personnel action, including termination of employment. If an employee believes that a violation of the Financial Officer Code of Ethics has occurred, please contact the Chief Financial Officer or the Audit Committee of the Board of Directors or if an employee is concerned about maintaining anonymity, such employee may send correspondence to the following outside private mailbox address at:
1335 Dublin Road
Columbus, Ohio 43215
It is against the Company’s policy to retaliate against any employee for good faith reporting of violations of this Code. Reprisals or retributions against an employee who makes a report will not be tolerated.
VI. CONSEQUENCES OF NON-COMPLIANCE WITH THIS CODE
Violations of this Code will be reported to the Audit Committee of the Board of Directors. Failure to comply with this Code of Ethics or applicable laws, rules or regulations (including without limitation all rules and regulations of the Securities and Exchange Commission) may result in disciplinary measures, up to and including discharge from Capital City, and any appropriate legal action.
VII. PUBLIC RESPONSIBILITIES
The Company’s Insider Trading Policy prohibits Company employees from making transactions (i.e., buying or selling) in Company stock (including options and related investments), at any time when the employee may possess material information about the Company that has not been publicly disclosed. Information may be considered material if it is considered so important that its public release would have been viewed by the reasonable investor as having significantly altered the “total mix” of information made available, and so could affect the Company’s stock price. Federal and state securities laws dictate this policy, and it applies to all officers, members of the Board of Directors, employees, consultants and contractors, including members of their immediate families and households, who receive or have access to material nonpublic information regarding the Company.
Certain material information that is related to the Company’s business may not affect the Company’s stock price, but may affect the stock price of another company or the value of other investment opportunities. Company employees who are working on or who have knowledge of a business transaction which may be material to another company, are subject to the same restrictions on trading in the stock of the other company as described above concerning material nonpublic information regarding the Company. Trading in the securities of the other company must be delayed until the information is publicly announced or otherwise becomes nonmaterial to the other company.
Members of the Board of Directors, executives officers and other individuals with access to material nonpublic information are subject to additional restrictions on the trading of Company stock, including mandatory “blackout periods” during which they may not engage in any Company securities transactions.
In addition, individuals in possession of material nonpublic information are also prohibited from “tipping” others. This concept includes passing on information on an unauthorized basis to friends or family members under circumstances that suggest the “tipper” was trying to assist them in making a profit or avoiding a loss. Besides being considered a form of insider trading, tipping is also a breach of corporate confidentiality. Persons in possession of material nonpublic information must avoid discussion of any sensitive information in locations where others may gain access to the protected information.
Special Government Rules
Conducting business with any government body (including national, state or municipal) often triggers special requirements. Because government officials are obligated to follow specific codes of conduct and laws, special care must be undertaken in any government transaction. Special considerations include:
Avoiding the improper solicitation of confidential information;
The prohibition of any kickbacks, bribes, gratuities of exchange or anything else of value with the intention of obtaining favorable treatment from the recipient (including exchanges which might otherwise be customary in the business sector); and
The hiring of present and former government personnel only in compliance with applicable laws and regulations.
VIII. USING COPYRIGHTED INFORMATION
Employees may sometimes need to use third-party copyrighted material to perform their jobs. Before such third-party material may be used, appropriate authorization from the copyright holder must be obtained, other than for material for which the Company holds the copyright. The need for such permission may exist whether or not the end product containing third-party material is for personal use, for the Company’s internal or other use. It is against the Company policy and it may be unlawful for any employee to copy, reproduce, scan, digitize, broadcast, or modify third-party copyrighted material when developing Company products, promotional materials or written communications, unless written permission from the copyright holder has been obtained prior to the proposed use. Improper use could subject both the Company and the individuals involved to possible civil and criminal actions for copyright infringement. It is against our policy for employees to use Company facilities for the purpose of making or distributing unauthorized copies of third-party copyrighted materials for personal use or for use by others.
IX. PROPRIETARY INFORMATION
Proprietary information is defined as information developed, created, discovered by or on behalf of the Company, or that became known by or was conveyed to the Company, that has commercial value in the Company’s business or that the Company does not want publicly disclosed. The Company requires that each employee be personally responsible for safeguarding the Company’s proprietary information from loss or improper modification or disclosure.
The Company’s business and business relationships center on the confidential and proprietary information of the Company and of those with whom we do business- customers, vendors, and others. The disclosure or use of confidential and proprietary information – whether belonging to the Company or a third party, should be covered by a written agreement. In addition to the obligations imposed by that agreement, all employees should comply with the following requirements:
Confidential information should be received and disclosed only under the auspices of a written agreement;
Confidential information should be disclosed only to those Company employees who need to access it to perform their jobs for the Company;
Confidential information of a third party should not be used or copied by any Company employee except as permitted by the third-party owner in a written agreement between the Company and the third party owner; and
Employees must refrain from using any confidential information belonging to any former employers (with the exception of any such information acquired by the Company), and such information must never be brought to the Company or provided to other employees.
X. AMENDMENT, MODIFICATION AND WAIVER
This Code may be amended or modified by the Board of Directors. Any waiver of any provision of this Code must be approved.
With regard to any director or officer, by the Board of Directors, or if a significant number of its members will be personally affected by the waiver, by a committee consisting entirely of directors who will not be personally affected by the waiver.
With regard to any employee who is not an officer of the Company, by the employee’s supervisor or such other person as is designated by the President of the Company.
No waiver of any provision of this Code with regard to a director or officer will be effective until that waiver has been reported to the person responsible for the preparation and filing of the Company’s reports on Form 8-K (or any successor to that form) in sufficient detail to enable that person to prepare a report on Form 8-K containing any required disclosure with regard to the waiver. The Company will promptly disclose on Form 8-K, by means of the filing of such form and dissemination by the Internet or by other electronic means, any change in or waiver of the Code.
Any waiver of provisions of this Code will be reported in filings with the SEC and otherwise reported to the Company’s stockholders to the full extent required by the rules of the SEC and by any applicable rules of the OTC Bulletin Board.
April 3, 2008