Code of Business Conduct and Ethics
I. Introduction
Topaz Energy Corp. requires the highest standards of professional and ethical conduct from our directors, officers, employees and consultants (“Topaz personnel”). Our reputation among our shareholders for honesty and integrity is key to the success of our business. No Topaz personnel will be permitted to achieve results through violations of laws or regulations, or through unscrupulous dealings. Topaz expects its partners, vendors and suppliers to conduct business in a similar manner, in conformance with all laws, regulations, protection of human rights and in alignment with Topaz’s business practices. References in this Code to the "Corporation" or to "Topaz" mean Topaz Energy Corp. and its subsidiaries as applicable.
This Code reflects our commitment to a culture of honesty, integrity and accountability and outlines the basic principles and policies with which all Topaz personnel are expected to comply. Please read this Code carefully.
In addition to following this Code in all aspects of your business activities, you are expected to seek guidance in any case where there is a question about compliance with both the letter and spirit of our policies and applicable laws. This Code sets forth general principles and does not supersede the specific policies and procedures that are covered in specific policy statements, such as the Disclosure, Confidentiality and Trading Policy. Violation of these policies may result in disciplinary actions up to and including discharge from the Corporation.
Your cooperation is necessary to the continued success of our business and the cultivation and maintenance of our reputation as a good corporate citizen. All Topaz personnel and primary partners, vendors and suppliers are required to review and attest to having read, understood and agree to comply with this code, on an annual basis.
I. Reporting Behaviour That Violates Laws, Rules, Regulations or this Code
We have a strong commitment to conduct our business in a lawful and ethical manner consistent with the principles set out below. If you observe a violation of law, rules, regulations or this Code, please report the behaviour to supervisors, managers or other appropriate personnel, however if you would prefer to report anonymously, please use our third-party whistleblower hotline referenced below. Topaz prohibits retaliatory action against any Topaz personnel who, in good faith, reports a possible violation. It is unacceptable to file a report knowing it to be false. In this regard, please review Topaz’s Whistleblower Policy.
Topaz reserves the right to complete audits of any payment received or paid by Topaz to ensure fair and appropriate business dealings which may affect Topaz, Topaz personnel, or Topaz’s partners, vendors or suppliers.
To report any illegal or unethical behaviour anonymously, please call Topaz’s Whistle Blower Hotline (“Confidenceline”) at 1-800-661-9675.
II. Conflicts of Interest
A conflict of interest occurs when an individual's private interest interferes, or appears to interfere, in any way with the interests of the Corporation. A conflict situation can arise when any Topaz personnel takes actions or has interests that may make it difficult to perform his or her work effectively. Conflicts of interest also arise when an employee, officer or director, or a member of his or her family, receives improper personal benefits as a result of his or her position in the Corporation. Loans to, or guarantees of obligations of, such persons are likely to pose conflicts of interest, as are transactions of any kind between the Corporation and any other organization in which you or any member of your family have a direct or indirect interest, as well as the misappropriation of Topaz resources for personal use or benefit. A conflict may also arise from the diversion of an individual's time to an outside business or activity which deprives Topaz of the individual’s service without an off-setting direct or indirect benefit to Topaz.
Activities that could give rise to conflicts of interest are prohibited unless specifically approved in advance by the Board of Directors; provided that the foregoing shall not apply to directors of the Corporation acting as directors of other public or private companies who shall comply with the provisions of the Business Corporations Act (Alberta) in respect thereof and shall advise the Chairman of the Board of the holding of such directorships. It is not always easy to determine whether a conflict of interest exists, so any potential conflicts of interest must be reported immediately to senior management, which includes any conflict of interest involving Topaz’s partners, vendors or suppliers.
Topaz has developed the Related Party Transaction Policy which governs potential conflicts of interest which may arise in regard to transactions between related parties.
III. Corporate Opportunities
Topaz personnel are prohibited from taking opportunities that arise through the use of corporate property, information or position and from using corporate property, information or position for personal gain. Topaz personnel are also prohibited from competing with the Corporation; provided that the foregoing shall not apply to directors solely as a result of them acting as directors or officers of other companies which they do not control.
IV. Confidentiality
Topaz personnel must maintain the confidentiality of information entrusted to them by the Corporation or that otherwise comes into their possession in the course of their relationship with Topaz, except when disclosure is authorized or legally mandated. The obligation to preserve confidential information continues even after you leave the Corporation.
Confidential information includes all non-public information, and information that suppliers and customers have entrusted to us. The Corporation has a Disclosure, Confidentiality and Trading Policy, which sets forth your obligations in respect of the Corporation’s confidential information and your responsibilities with respect to such information.
V. Protection and Proper Use of the Corporation’s Assets
All Topaz personnel should endeavour to protect the Corporation's assets and ensure their efficient use. Theft, carelessness and waste have a direct impact on the Corporation's profitability. Any suspected incidents of fraud or theft should be immediately reported to a senior officer or to the Chairman of the Audit Committee for investigation.
The Corporation’s assets, such as funds, products or computers, may only be used for legitimate business purposes or other purposes approved by management. The Corporation’s assets may never be used for illegal purposes.
The obligation to protect the Corporation’s assets includes proprietary and confidential information. Proprietary information includes any information that is not generally known to the public or would be helpful to our competitors. Examples of proprietary information are intellectual property, acquisition and exploration plans and prospects, business and marketing plans and personal information. The obligation to preserve proprietary information continues even after you leave the Corporation.
Through your relationship with Topaz you may be engaged in or privy to various forms of research, problem solving or invention. The product of the efforts produced within the scope of your relationship belongs to Topaz, whether the product was developed while actually at work or not. Such products, commonly called “intellectual property” include computer programs, technical processes, inventions, research methods, reports or articles and any other form of innovation or development, including material protected by patents, trademarks or copyright, as appropriate. Intellectual property assets belong to and are the property of Topaz.
VI. Insider Trading
Insider trading is unethical and illegal. Topaz personnel are not allowed to trade in securities of an entity while in possession of material non-public information regarding that entity. It is also illegal to "tip" or pass on inside information to any other person who might make an investment decision based on that information or pass the information on further. The Corporation has a Disclosure, Confidentiality and Trading Policy, which sets forth your obligations in respect of trading in the Corporation's securities.
Topaz provides onboarding training for Topaz personnel and supports and encourages continuing education in respect of securities regulations relevant to Topaz’s business and Topaz personnel.
VII. Fair Dealing
No Topaz personnel should take unfair advantage of customers, suppliers, competitors or other Topaz personnel through illegal conduct, manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair-dealing practice. Topaz expects its partners, vendors and suppliers to conduct business in an ethical manner and any incident or suspected incident of bribery, corruption, illicit payments, illegal conduct, manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair-dealing practice must be reported to the Chairman or Audit Committee, or through the confidential whistleblower hotline.
VIII. Compliance with Laws, Rules and Regulations
Compliance with both the letter and spirit of all laws, rules and regulations applicable to our business is critical to our reputation and continued success. All Topaz personnel must respect and obey the laws of the cities, provinces and countries in which we operate and avoid even the appearance of impropriety. Topaz expects its partners, vendors and suppliers to uphold the same standard of compliance and performs due diligence procedures prior to entering into any significant transaction with counterparties.
Topaz provides onboarding training for Topaz personnel and supports and encourages continuing education in respect of legal and regulatory matters relevant to Topaz’s business.
IX. Compliance with Environmental Laws
The Corporation is sensitive to the environmental, health and safety consequences of its operations. Accordingly, the Corporation is in strict compliance with all applicable Federal and Provincial environmental laws and regulations. If any Topaz personnel has any doubt as to the applicability or meaning of a particular environmental, health or safety regulation, he or she should discuss the matter with a member of the Corporation's senior management or board.
Topaz provides onboarding training for Topaz personnel and supports and encourages continuing education in respect of environmental regulations relevant to Topaz’s business.
X. Discrimination and Harassment
We value the diversity of our employees and are committed to prohibiting discrimination and harassment at Topaz and providing equal opportunity from a race, gender, nationality, age, ethnicity, language, or other status deemed relevant in all aspects of employment, including the Corporation’s hiring and advancement practices. Abusive, harassing or offensive conduct is unacceptable, whether verbal, physical or visual. The Corporation has a Human Rights and Respectful Workplace Policy which affirms the Board’s intention and responsibility to respect human rights and provide and maintain a respectful workplace, business environment, and relationships with stakeholders. This policy extends to Topaz’s suppliers, vendors and suppliers.
XI. Human Rights and Health & Safety
We are all responsible for maintaining a safe workplace by following safety and health rules and practices which we also expect from our partners, vendors and suppliers. The Corporation is committed to keeping its workplaces free from hazards. Please report any accidents, injuries, unsafe equipment, practices or conditions immediately to a supervisor or other designated person. Threats or acts of violence or physical intimidation are prohibited. Please refer to the Environment, Human Rights and Health & Safety Policy which applies to ensuring the health and safety of the Corporation’s stakeholders.
Topaz provides onboarding training for Topaz personnel and supports and encourages continuing education in human rights and health & safety matters.
XII. Accuracy of Corporation Records and Reporting
Honest and accurate recording and reporting of information is critical to our ability to make responsible business decisions. The Corporation's accounting records are relied upon to produce reports for the Corporation's management, shareholders, creditors, governmental agencies and others. Our financial statements and the books and records on which they are based must accurately reflect all corporate transactions and conform to all legal and accounting requirements and our system of internal controls.
All employees have a responsibility to ensure that the Corporation's accounting records do not contain any false or intentionally misleading entries. We do not permit intentional misclassification of transactions 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.
Business records and communications often become public through legal or regulatory investigations or the media. We should avoid exaggeration, derogatory remarks, legal conclusions or inappropriate characterizations of people and companies. This applies to communications of all kinds, including email and informal notes or interoffice memos. Records should be retained and destroyed in accordance with the Corporation's records retention policy.
XIII. Computer and Information Systems and Security
All Topaz personnel are responsible for the security and protection of electronic information resources over which he or she has control. Resources to be protected include networks, computers, software and data. The physical and logical integrity of these resources must be protected against threats such as unauthorized intrusions, malicious misuse, or inadvertent compromise. Activities outsourced to outside service providers must comply with the same security requirements as in-house.
E-mail systems and Internet services are provided to help us do work. Incidental and occasional personal use is permitted, but never for personal gain or any improper purpose. Also remember that "flooding" our systems with junk mail and trivia and streaming music or video hampers the ability of our systems to handle legitimate company business and is prohibited. The use of social media, blogging or similar activities that may lead to the disclosure of Topaz proprietary information or that could harm the reputation of the Corporation and/or any of its employees, contractors, suppliers, vendors, business partners or landowners is prohibited.
Your messages (including voice mail) and computer information are considered company property and you should not have any expectation of privacy. Unless prohibited by law, the Corporation reserves the right to access your e‑mail communication and disclose this information as necessary for business purposes.
Use good judgment, and do not access, send messages or store any information on your work computer that you would not want to be seen or heard by other individuals.
In order to identify, prevent, and mitigate computer and information security risks, Topaz invests in: sophisticated network antivirus and security features and a secure, dedicated internet connection; training and prevention; and has access to dedicated, experienced service professionals to engage pursuant to its incident response policy. Topaz provides to its personnel: computer systems and security onboarding training; multi-factor authentication for remote work access; cybersecurity risk management and incident response manuals; random phishing tests; access to professional IT service providers for education and troubleshooting; and regular communication and training related to security enhancements and recommended risk prevention practices.
XIV. Political Activities and Contributions
We respect and support the right of our employees to participate in political activities. However, these activities should not be conducted on Corporation time or involve the use of any Corporation resources. Topaz personnel will not be reimbursed for personal political contributions.
We may occasionally express our views on local and national issues that affect our operations. In such cases, Corporation funds and resources may be used, but only when permitted by law and by our strict Corporation guidelines.
XV. Illicit Payments
Unlawful or unethical behaviour in the Corporation's business is not tolerated, including soliciting, accepting, or paying bribes or other illicit payments for any purpose. Situations where judgment might be influenced or appears to be influenced by improper considerations must be avoided. Topaz personnel are expected to act responsibly and with integrity when making a decision on whether to accept the offer of a gift, benefit or entertainment. Gifts should not be accepted if they could be reasonably considered to be extravagant for an individual in the position of the recipient, and employees must avoid the appearance and the act of improperly influencing business relationships with the organizations or individuals with whom they deal. If there is any doubt about any gift, you should discuss it with a member of senior management or the board.
XVI. Anti-Corruption Policy
Topaz has a zero-tolerance policy for, and Topaz personnel must comply with all laws prohibiting, any form of corruption(1), bribery(2), extortion(3), money laundering(4), embezzlement(5) and improper payments to officials. Topaz expects its partners, vendors and suppliers to maintain similar policies which must extend to any sub-contractors or employees.
Topaz will provide onboarding training for Topaz personnel and support and encourage continuing education regarding professional ethics and regulations governing illegal and prohibited behavior. At a minimum, employees with professional designations are required to complete minimum annual continuing professional development education requirements. For chartered professional accountants, this requirement specifically includes education in regard to professional ethics.
Topaz commits to reimbursing employees’ out of pocket expenses incurred in regard to professional designation annual dues, course fees attributed to annual minimum professional education requirements and in addition, course fees attributed to education which is subject to review and approval by executive officers (for employees or other executives) or the governance, compensation and sustainability committee (for directors or for executive education exceeding $5,000 per annum).
XVII. Directors Role in the Code of Business Conduct and Ethics
To the extent that management is unable to make a determination as to whether a breach of this Code has taken place, the Board of Directors will review any alleged breach of the Code to determine if a breach has occurred.
Any waiver of this Code for executive officers or directors will be made only by the Board of Directors or a committee of the Board of Directors. Conduct by a director or executive officer which constitutes a material departure from this Code may be promptly disclosed if required by law or stock exchange regulation.
XVIII. Compliance Procedures
This Code cannot, and is not intended to, address all of the situations you may encounter. There will be occasions where you are confronted by circumstances not covered by policy or procedure and where you must make a judgment as to the appropriate course of action. In those circumstances we encourage you to use your common sense, and to contact your supervisor or manager for guidance.
If you do not feel comfortable discussing the matter with your supervisor, manager, or executive you can report any incidents anonymously through Topaz’s Whistle Blower Hotline (“Confidenceline”) at 1-800-661-9675.
Notes:
(1) Corruption is defined as a form of dishonesty or a criminal offense which is undertaken by a person or an organization which is entrusted with a position of authority, or order to acquire illicit benefits or abuse power for one’s personal gain.
(2) Bribery is defined as the offering, giving, receiving or soliciting of any item of value to influence the actions of another person.
(3) Extortion is defined as the practice of obtaining benefit through coercion.
(4) Money laundering is defined as the process of changing large amounts of money obtained from crimes, into origination from a legitimate source.
(5) Embezzlement is defined as the act of withholding assets for the purpose of conversion of such assets, by one or more persons to whom the assets were entrusted, either to be held or to be used for specific purposes.
April 2022