Ethics Policy

It is the policy of Magellan Aerospace Corporation (together with its subsidiaries and all entities controlled by it, collective, “Magellan” or the “Company”) to conduct its business affairs in compliance with all applicable laws, statutes, rules and regulations and expects all directors, officers and employees (“Employees”) acting on its behalf to do likewise. In addition, business dealings among Employees and by Employees with customers, suppliers, governmental and regulatory authorities, communities and shareholders (“Stakeholders”) must be based on principles of honesty, integrity and the ethical standards outlined below.

APPLICABILITY

This Code of Ethics and Business Conduct (sometimes referred to herein as the “Code”) applies to all Employees.

GENERAL

The principles outlined in this document are intended to:

  • establish a minimum global standard of conduct by which all Employees are expected to abide,
  • protect the business interests of Magellan, its Employees, customers and suppliers,
  • maintain Magellan’s reputation for integrity, and
  • ensure that Magellan, through its Employees, complies with applicable legal and regulatory obligations.

The principles in the Code are the individual and collective responsibility of all Employees.

The principles in the Code are extremely important because they establish a minimum standard of conduct for all Employees at all levels and ensure a consistent and high standard of ethical conduct no matter where a customer, supplier or other person or entity may have contact with Magellan. Employees must familiarize themselves with and carefully follow these principles in their daily activities. All Employees must act, and must also be seen by Stakeholders to be acting, in accordance with these principles.  Employees are also responsible for managing risk effectively and preventing losses.

The Code is not meant to be a complete listing of business conduct and ethics covering every eventuality. Consequently, should an Employee be confronted with a situation where further guidance is required, the matter should be discussed with their immediate supervisor, department head, human resources department or senior management.

The Code is in addition to and does not detract from any other agreements, manuals, guidelines and policies that may also be applicable to Employees and which may deal with items also dealt with in the Code.

REPORTING VIOLATIONS OF THE CODE

Employees have a duty to report situations of non-compliance with respect to this Code of which they become aware including any violation of the laws, rules, regulations or policies that apply to the Company, to their immediate supervisor, the senior Human Resources representative at their operational unit (the “Divisional Human Resources Representative”), or to the Chairman of the Audit Committee of the Board of Directors of Magellan (the “Board”) by mail, telephone or email.  Aside from instances of non-compliance, Employees may also report concerns relating to business conduct and ethics in the same manner.  All reports of known or suspected violations of the law or this Code will be handled sensitively and with discretion.  Your supervisor, your Divisional Human Resources Representative and the Company will protect your confidentiality to the extent possible, consistent with the law and the Company’s need to investigate your concern.  A failure to comply with the Code will result in disciplinary actions up to and including termination.  All violations will be reported to the Vice President, Human Resources.

POLICY AGAINST RETALIATION

Retaliation in any form against an individual who, in good faith, seeks help or reports known or suspected violations of this Code or of the law, even if the report is mistaken, or who assists in the investigation of a reported violation, is itself a serious violation of this Code. Acts of retaliation should be reported immediately and will be disciplined appropriately, including potential termination of employment.  Magellan does not tolerate retaliation in any form against Employees who honestly and accurately report a concern.  At the same time, it is serious and unacceptable to make false allegations.

Employees are advised to read and become familiar with the terms of Magellan’s corporate policy 3.10, Whistleblower Protection.

INTEGRITY OF RECORDS AND SOUND ACCOUNTING PRACTICES

Magellan takes very seriously the accuracy of its financial records and financial statements.  All Company records are to be prepared with care and honesty and in compliance with Magellan’s accounting and internal control procedures, record keeping policy, anti-corruption policy, and with Canadian generally accepted accounting principles and all applicable standards, laws and regulations for accounting and financial reporting of transactions, estimates and forecasts.

All Employees involved in preparing or providing information for inclusion in any reports or documents which Magellan is required to file with any governmental or regulatory agency or any public communications are responsible for ensuring that (i) information provided is complete, accurate and current, and (ii) reports and documents are prepared in conformity with all regulatory requirements and filed in a timely manner. If an Employee becomes aware of a materially inaccurate or misleading statement in a public communication, the Employee must report it immediately to the Chief Executive Officer of Magellan or the Chairman of the Audit Committee of the Board.  Making false or misleading statements to external auditors can be a criminal act that can result in severe penalties. No Employee may directly or indirectly take any action to fraudulently influence, coerce, manipulate or mislead Magellan’s independent public auditors for the purpose of rendering Magellan’s financial statements misleading.

MAINTENANCE OF ASSETS

All Employees have a responsibility to protect Magellan’s assets against loss, theft, abuse and unauthorized use or disposal.  Magellan’s assets include all property whether tangible, intangible or electronic in form, which includes the Company’s products, equipment, vehicles, computers, and software and telephone systems.  All Magellan’s assets must only be used for legitimate business purposes.

Employees should report any suspected incident of fraud or theft to their immediate supervisor for
investigation.  Company assets should not be used for non-Company business, though incidental personal use is permitted, provided that such use is not in violation of applicable law or in advancement of any illegal purpose.  There should be no expectation of personal privacy in respect of the use of any of the Company’s assets.

CONFIDENTIALITY

Employees must preserve and protect the confidentiality of information entrusted to them by the Company, the Stakeholders and third parties including if legally mandated to be disclosed, except when disclosing information is approved.  Confidential information encompasses proprietary information which is not in the public domain that could be of use to investors or competitors, or that could harm the Company, its employees, its customers or suppliers if disclosed.  Employees must be aware that the responsibility to protect confidential information continues outside the workplace. Employees should not discuss confidential information in public places, such as elevators, public transportation or restaurants.

Employees must also not use or disclose to the Company any proprietary information or trade secrets of any former employer or other person or entity with whom obligations of confidentiality exist, or which has been wrongfully obtained from the owner of the information.

INSIDER TRADING

Employees who possess material, non-public information may not buy or sell Magellan securities and may not disclose such information while such information remains non-public. These trading and disclosure prohibitions apply to all Employees.  Information is material if there is a reasonable prospect that an investor would consider the information to be important in arriving at a decision to buy, sell or hold Magellan securities.  In addition, Magellan has mandated specific blackout periods during which certain Employees may not buy or sell Magellan securities. Should you require information on blackout periods or where you have any doubts, contact your General Manager or Divisional Finance representative.

Employees are advised to read and become familiar with the terms of Magellan’s corporate policy 1.04, Insider Investment in Securities.

CONFLICT OF INTEREST

The Company requires that each Employee disclose any situations that reasonably would be expected to give rise to a conflict of interest.  If you suspect that you have a conflict of interest, or something that others could reasonably perceive as a conflict of interest, you must report it to your supervisor, your Divisional Human Resources Representative or the Vice President, Human Resources who will work with you to determine where you have a conflict of interest and, if so, how best to address it.  Employees must take care to ensure that they identify and avoid any situation of actual or apparent conflict of interest, whether the situation involves the Employee directly or a member of the Employee’s immediate family.

A “conflict of interest” occurs when an Employee’s personal interests (which may include interests of members of the Employee’s family, which for the purposes of the Code shall include an Employee’s spouse, common law or life partner, brothers, sisters, parents, in-laws, and children whether such relations are by blood, marriage or adoption) interfere, or appear to interfere, in any way with the interests of the Company.  Business decisions and actions must be made in the best interests of the Company and should not be influenced by personal considerations or relationships.  A conflict situation can arise when an Employee of Magellan takes actions or has interests that may make it difficult to perform his or her Company work objectively and effectively.  Conflicts of interests may also arise when an Employee, or members of his or her family, receives improper gifts, entertainment or personal benefits as a result of his or her position in the Company.  Improper gifts, entertainment or personal benefits include gifts, entertainment or personal benefits of greater than nominal value or that are material to the Employee.  One item on its own may not be material but a series from the same person or company may be material and therefore, improper.
Giving gifts and entertainment to customers, suppliers and other business associates is also prohibited by Magellan when the gifts or entertainment are of greater than nominal value or are intended to bribe or influence the recipient, or when the law prohibits them.  An Employee may not give or receive a gift, benefit or entertainment when they know that doing so will violate the business practices of the other party.  Employees are advised to read and become familiar with the terms of Magellan’s corporate policy 1.08, Anti-Corruption.

It is almost always a conflict of interest for an Employee to be a director of, obtain loans or guarantees of personal obligations from, work simultaneously for, provide services to or have a personal or family financial interest (ownership or otherwise) in a competitor, customer or supplier.  Employees are not permitted to work for a consultant or Board member.  The best policy is for Employees to avoid any direct or indirect business connection with Magellan’s customers, suppliers or competitors, except on behalf of Magellan.  This guideline does not prohibit arms-length transactions with banks, brokerage firms or other financial institutions.

No Employee should serve on a board of directors or trustees or on a committee of any entity (whether for profit or not) whose interests reasonably would be expected to conflict with those of Magellan’s.

Conflicts of interest are prohibited as a matter of Company policy, unless waived by the Board.

COMPETITION AND FAIR DEALING

Magellan seeks to outperform its competition fairly and honestly and to obtain competitive advantages through superior performance, never through unethical or illegal business practices.  Stealing proprietary information, possessing trade secret information that was wrongfully obtained, or inducing such disclosures by past or present employees of other companies, is prohibited.  Each Employee should respect the rights of and deal fairly with Magellan’s customers, suppliers, competitors and other Employees. No Employee should take improper advantage of anyone through manipulation, concealment, abuse of proprietary information, misrepresentation of material facts, or any other intentional improper-dealing practice.

CORPORATE OPPORTUNITIES

Employees owe a duty to Magellan to advance Magellan’s legitimate interests when the opportunity to do so arises.  Employees are prohibited from taking for themselves personal opportunities that properly belong to Magellan or that are discovered through the use of Magellan property, information or position.  Employees must not use corporate property, information or position for personal gain or to compete with Magellan.

LAWS, STATUTES AND REGULATIONS

It is the policy of Magellan to comply, not merely with the letter, but also with the spirit of the law.  Violation of the law can affect Magellan’s reputation and ability to carry on business.  Each Employee is responsible for knowing and understanding the laws, rules and regulations applicable to the performance of his or her duties at Magellan and complying with both the letter and spirit of these laws, rules and regulations. Ignorance of the law is not a valid defense if the law has been contravened. Employees must not knowingly or actively assist in activity that is criminal in the jurisdictions in which Magellan conducts business. Employees who encounter situations where the requirements of the Code appear to conflict with local requirements must advise their supervisor.

WAIVERS AND INTERPRETATION OF THE CODE

Any waiver of this Code may be made only by the Board of Directors of Magellan Aerospace Corporation and will be promptly disclosed as required by law or regulation.  The Board has the exclusive responsibility for the final interpretation of this Code.  This Code may be revised, changed or amended at any time by the Board without prior notice.

RELATIONSHIP TO OTHER POLICIES

If you are an Employee of Magellan, all Company policies apply to you.  If you are a director, the guidelines of the Board of Directors will guide you procedurally in your position as a director.

COMPLIANCE PROCEDURES

All Employees have a responsibility to understand and follow this Code of Ethics and Business Conduct.  In addition, all Employees are expected to perform their work with honesty and integrity in any areas not specifically addressed by the Code.  A violation of this Code may result in appropriate disciplinary action including the possible termination from employment with the Company, without additional warning.  This determination will be based upon the facts and circumstances of each particular situation.  An Employee accused of violating this Code will be given an opportunity to present his or her version of the events at issue prior to any determination of appropriate discipline.  Employees who violate the law or this Code may expose themselves to substantial civil damages, criminal fines and prison terms.  The Company may also face substantial fines and penalties and may incur damage to its reputation and standing in the community.  An Employee’s conduct as a representative of the Company, if it does not comply with the law or with this Code, can result in serious consequences to both the Employee and the Company.  The Company may be required to report certain types of breaches of the Code to regulatory authorities in which case the Employee may be subject to criminal or civil penalties.  Nothing in this Code prohibits or restricts the Company from taking any disciplinary action on any matters pertaining to employee conduct, whether or not they are expressly discussed in this Code.

Magellan’s suppliers, contractors, joint venture partners and business partners shall be directed to Magellan’s website to read the Code.  Such parties shall be asked to respect the terms and intent of the Code.

Failure to read the Code does not exempt an Employee from his or her responsibility to comply with the Code, applicable laws, rules, regulations, and all Magellan policies and guidelines.

Questions concerning this Code should be referred to an Employee’s immediate supervisor, department head, human resources department, division vice president or subsidiary general manager.  In the case of directors, questions should be directed to the Chairman of the Board.