WELLSFORD REAL PROPERTIES, INC.
CODE OF BUSINESS CONDUCT AND ETHICS FOR DIRECTORS, SENIOR FINANCIAL OFFICERS,
OTHER OFFICERS AND ALL OTHER EMPLOYEES
INTRODUCTION
It is the general policy of Wellsford Real Properties, Inc. (the "Company")
to conduct its business activities and transactions with the highest level of
integrity and ethical standards and in accordance with all applicable local,
state and federal laws. Obeying the law both in letter and in spirit is the
foundation on which this Company's ethical standards are built. In carrying out
this policy, the Company has adopted the following Code of Business Conduct (the
"Code").
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 employees of the Company. All of our employees must comply with this Code
and seek to avoid even the appearance of improper behavior. The Code should also
be provided to and followed by the Company's agents and representatives,
including consultants.
If a law conflicts with a policy in this Code, you must comply with the
law; however, if a local custom or policy conflicts with this Code, you must
comply with the Code. 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. In addition, some of the violations can subject either the
employee or the Company to civil and criminal penalties.
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 15 of this
Code.
1. COMPLIANCE WITH LAWS, RULES AND REGULATIONS
The Company complies with all applicable laws and regulations in the
conduct of its activities and expects the employees to do the same. 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.
2. CONFLICTS OF INTEREST
It is the policy of the Company to avoid situations that create an actual
or potential conflict between an employee's personal interests and the interests
of the Company. A conflict of interest exists when a person's loyalties or
actions are divided between the interests of the Company and those of another,
such as a competitor, supplier, customer or personal business. A conflict
situation can arise when an employee, officer or director takes actions or has
interests that may make it difficult to perform his or her work for the Company
objectively and effectively. Conflicts of interest may also arise when an
employee, officer or director, or members of his or her family, receives
improper personal benefits as a result of his or her position in the Company.
Moreover, the appearance of a conflict of interest alone can adversely affect
the Company and its relations with its customers, suppliers and employees. The
appearance of a conflict should also be avoided.
Employees are expected to use good judgment, to adhere to high ethical
standards and to avoid situations that create an actual or potential conflict 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 without prior
disclosure to and approval from the Chief Executive Officer. The best policy is
to avoid any direct or indirect business connection with our customers,
suppliers or competitors, except on our behalf.
Conflicts of interest can also arise with respect to employment of
relatives and persons with close personal relationships. Further, if an employee
or someone with whom an employee has a close relationship (a family member or
close companion) has a financial or employment relationship with a competitor,
supplier, or potential supplier, the employee must disclose this fact in writing
to the Chief Financial Officer.
Federal law now prohibits most loans or extensions of credit from a company
whose stock is publicly traded to its directors or executive officers. The
Company will not directly or indirectly extend any loan or credit to any
director or executive officer except as permitted by law and approved by a vote
of the disinterested members of the Board of Directors.
3. CORPORATE OPPORTUNITIES
Employees, officers and directors are prohibited from taking for themselves
opportunities that are discovered through the use of corporate property,
information or position without the consent of the Board of Directors. No
employee, without prior approval from the Company's Chief Executive Officer, may
use corporate property, information, or position for 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 secret trade information that was obtained
without the owner's 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 Company's customers, suppliers,
competitors and 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.
Company personnel should not engage a competitor in discussions, agreements
or understandings concerning proprietary or specific information with regards to
tenant lease terms, investees, interest rates, transaction structures, similar
business related arrangements or any other business of the Company. In addition,
Company personnel should avoid discussing with a competitor of any other
agreements inhibiting free and open competition or involving tie-in sales or
reciprocal transactions without prior authorization from the Chief Financial
Officer.
The purpose of business entertainment and gifts in a commercial setting is
to create good will and sound working relationships, not to gain an unfair
advantage with customers. No gift or entertainment should ever be offered,
given, provided or accepted by any Company employee, family member of an
employee or agent 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.
Any proposed gift to an employee, family member of an employee or agent which is
other than of nominal value (greater than $50) should be discussed first with
the Chief Financial Officer for appropriate resolution, in advance of the
receipt of such proposed gift.
5. EQUAL EMPLOYMENT AND WORKING CONDITIONS
Each of us has a fundamental responsibility to show respect and
consideration to our teammates. The diversity of the Company's 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 or any kind. All employment practices and decisions, including those
involving recruiting, hiring, transfers, promotions, compensation, benefits,
discipline and termination, will be conducted without regard to race, creed,
color, religion, national origin, sexual orientation, sex or age and will comply
with all applicable laws.
6. RELATIONSHIPS WITH CO-WORKERS
The Company expects everyone to provide co-workers with information that is
accurate, complete, objective, relevant, timely and understandable and to share
knowledge and maintain skills important and relevant to each co-workers' needs.
The Company expects all supervisory personnel to promote ethical behavior
in the work environment.
7. HEALTH AND SAFETY
The Company strives to provide each employee with a safe and healthy work
environment. Each employee has an individual 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 in the workplace will not be
tolerated.
8. DISCLOSURES IN PERIODIC REPORTS
As a public company, the Company is required to file various periodic
reports with the Securities and Exchange Commission. It is Company policy to
make full, fair, accurate, timely and understandable disclosure in compliance
with all applicable laws and regulations in all required periodic reports.
9. RECORD KEEPING
The Company requires honest and accurate recording and reporting of
information in order to make responsible business decisions. All of the
Company's books, records, accounts and financial statements must be maintained
in reasonable detail, must appropriately reflect the Company's transactions and
must conform both to applicable legal requirements and to the Company's system
of internal controls. All company business data, records and reports must be
prepared truthfully and accurately.
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 Company's record retention
policies.
10. CONFIDENTIALITY OF COMPANY INFORMATION AND TRADE SECRETS OF OTHERS
Persons who come into possession of Company information must safeguard the
information from the public and not intentionally or inadvertently communicate
it to any person (including family members and friends) unless the person has a
need to know the information for legitimate, Company-related reasons. This duty
of confidentiality is important both as to the Company's competitive position
and with respect to the securities laws applicable to the Company as a public
Company.
Consistent with the foregoing, all Company personnel should be discrete
with respect to inside information and not discuss it in public places. Such
information should be divulged only to persons having a need to know it in order
to carry out their job responsibilities. To avoid even the appearance of
impropriety, Company personnel should refrain from providing advice or making
recommendations regarding the purchase or sale of the Company's securities.
Confidential information related to the Company can include a variety of
materials and information regarding the ongoing operations and plans of the
Company. For example, confidential information can include information regarding
the financial health of the Company, salary and personnel information, and
marketing and sales plans. Confidential information will be held in the
strictest confidence, and such confidential information will not be disclosed by
any employee to any third party unless the third party has signed a
nondisclosure agreement approved by the Company's Chief Financial Officer and
the specific disclosure also has been approved by the Chief Financial Officer.
The confidential information can only be disclosed by an employee for limited
purposes where the confidential information is needed.
Company personnel must maintain the confidentiality of confidential or
proprietary information entrusted to them by the Company or others, except when
disclosure is authorized in writing by the Chief Financial Officer or required
by laws or regulations. Confidential information includes all non-public
information that might be of use to competitors, or harmful to the Company or
its customers or suppliers, if disclosed. The obligation to preserve
confidential information continues even after employment ends, in accordance
with the proprietary data agreement signed at the start of employment.
Company personnel must not intentionally or inadvertently breach any
agreement to keep knowledge or data in confidence or in trust prior to
employment with the Company. During employment by the Company no confidential or
proprietary information or material belonging to any previous employer or other
parties shall be improperly used or disclosed to the Company. Employees must not
bring onto the premises of the Company or use in the performance of his or her
responsibilities any unpublished documents or any property belonging to any
previous employer or any other person to whom the employee has an obligation of
confidentiality unless consented to in writing by that previous employer or
person.
11. PROTECTION AND PROPER USE OF COMPANY ASSETS
No secret or unrecorded fund of Company assets or cash shall be established
or maintained for any purpose. Anyone spending or obligating Company funds
should be sure that the transaction is properly and appropriately documented,
and that the Company receives the appropriate value in return.
All employees should endeavor to protect the Company's assets and ensure
their efficient use. Theft, carelessness, and waste have a direct impact on the
Company's 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 Company licenses the use of much of its computer software from a
variety of outside companies. The Company does not own this software or its
related documentation and, unless authorized by the software developer, does not
have the right to reproduce it. With regard to the use of software on local area
networks or on multiple machines, employees shall only use the software in
accordance with the license agreement.
12. POLITICAL CONTRIBUTIONS AND 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.
13. WAIVERS OF THE CODE OF BUSINESS CONDUCT AND ETHICS
Any waiver of this Code for executive officers or directors may be made
only by the Board or the Board committee responsible for corporate governance
matters and will be promptly disclosed as required by law or regulation.
14. REPORTING ANY ILLEGAL OR UNETHICAL BEHAVIOR OR OTHER VIOLATIONS OF THIS
CODE
Employees are responsible for being aware of the corporate policies
applicable to their activities and to comply with them fully. Employees also
have a duty to report any apparent misconduct through appropriate management
channels, or any special and confidential reporting mechanisms which may be
established within the Company for such purposes, and to assist the Company in
the prevention and correction of such problems. 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. Employees who know or have good reason to believe that
other employees are engaged in conduct violating this policy should report this
to the Chief Financial Officer. No supervisor shall retaliate against an
employee, either directly or indirectly, who in good faith and in accordance
with Company procedure, reports an act of apparent misconduct. Employees are
also expected to cooperate fully with the Company or governmental authorities in
any investigation of an alleged violation. Failure of any employee to comply
with such policies will result in disciplinary action up to and including
termination. In the event an employee is not satisfied with the response they
receive from their supervisor, the employee should speak to an appropriate
senior officer within the Company.
15. COMPLIANCE PROCEDURES
We must all work to ensure prompt and consistent action against, violations
of this Code. However, in some situations it is difficult to know right from
wrong. 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:
o Make sure you have all the facts. In order to reach the right solutions, we
must be as fully informed as possible.
o 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.
o 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.
o 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 supervisor's
responsibility to help solve problems. If you are not satisfied with the
response you receive from your supervisor, you should bring your grievance
to an appropriate senior officer within the Company.
o Seek help from Company resources. In the 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, discuss it
with a responsible officer of the Company.
o 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.
Further, the Company has adopted a policy for the protection of
whistleblowers that prohibits any form of retaliation against an individual
who reports violations.
o Always ask first, act later. If you are unsure of what to do in any
situation, seek guidance before you act.
CERTIFICATION OF RECEIPT AND
ACKNOWLEDGMENT OF COMPLIANCE WITH
CODE OF CONDUCT AND ETHICS POLICY FOR DIRECTORS, SENIOR
FINANCIAL OFFICERS, OTHER OFFICERS AND ALL OTHER EMPLOYEES
I hereby certify and acknowledge to Wellsford Real Properties, Inc. ("WRP")
the following:
I HAVE RECEIVED A COPY OF WRP'S CODE OF CONDUCT AND ETHICS POLICY FOR
DIRECTORS, SENIOR FINANCIAL OFFICERS, OTHER OFFICERS AND ALL OTHER EMPLOYEES
("POLICY").
I HAVE READ, UNDERSTOOD AND AGREE TO COMPLY WITH ALL TERMS, CONDITIONS AND
PROVISIONS OF THE POLICY.
I HAVE NOT VIOLATED THE TERMS, CONDITIONS AND PROVISIONS OF THE POLICY AT
ANY TIME IN THE PAST WHILE SERVING AS AN EMPLOYEE, OFFICER OR DIRECTOR OF WRP.
The undersigned declares that he or she has examined this Certification of
Receipt and Acknowledgment of Compliance, and, to the best of his or her
knowledge and belief, it is true, correct and complete.
Signature:
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Printed Name:
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Date:
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