CODE OF EMPLOYEE BUSINESS CONDUCT AND ETHICS
As adopted by the Board of Directors on May 8,
2013.
Contents
INTRODUCTION
INTRODUCTION
It always has been and continues to be the intent of CONSOL
Energy Inc. ("CONSOL") and its subsidiary companies (together with
CONSOL, the "Company") that all who conduct business on behalf of
the Company maintain high ethical and legal standards in conducting
such business. The essence of this Code of Employee Business
Conduct and Ethics (the "Code"), which has been adopted by CONSOL
and each of its majority-owned subsidiaries, is that each employee
will conduct all Company business with integrity, in compliance
with applicable laws, and in a manner that excludes considerations
of personal advantage.
This Code applies to all executives and other officers,
employees, consultants, independent contractors and agents
(collectively, "employees") of the Company (including,
specifically, CONSOL's principal executive officer and its
principal financial officer). Only the Board of Directors or an
authorized Committee of the Board may grant waivers of this Code
for executive officers.
If employees have any questions regarding acceptable conduct or
the interpretation of this Code, or if they are in doubt about the
best course of action in a particular situation, it is their
responsibility to seek clarification from their line management or,
if necessary, from CONSOL's Legal or HR Department or Internal
Auditing management.
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1. PAYMENTS BY AND TO THE COMPANY AND ITS EMPLOYEES
A. NO IMPROPER PAYMENTS TO U.S. OR NON-U.S. GOVERNMENT
OFFICIALS
Improper Payments to Government Officials are prohibited. An
Improper Payment is any direct or indirect payment; transfer; or
offer, promise, or authorization of a payment or transfer of
anything of value to a Government Official for the purpose of
improperly influencing government acts or decisions in order to
obtain or retain business or to secure a business advantage.
Improper Payments are not limited to cash payments and can include
anything of value such as gifts, entertainment, meals, travel, or
favors.
Government Officials include:
- Any officers, employees, or other persons acting on behalf of
- A government or government entity;
- An international organization (such as the Red Cross or World
Bank);
- A political party; or
- A government-owned or -controlled company, such as a
state-owned energy company or public utility; and
- Candidates for political office.
CONSOL has adopted specific policies and procedures regarding
Improper Payments to non-U.S. Government Officials. These policies
and procedures are contained in The Foreign Corrupt Practices Act
Policy of CONSOL Energy Inc.
Any questions or concerns about whether a payment is an Improper
Payment or whether a person is a Government Official should be
brought to the attention of CONSOL's Chief Legal Officer or his/her
designee(s).
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B. GIFTS, FAVORS, AND ENTERTAINMENT
(i) GENERALLY
Subject to the limitations of this Section, gifts, favors, and
entertainment may be provided to others at Company expense or for
the benefit of the Company or its employees in their capacity as
employees only if they meet all of the following criteria:
- They are consistent with customary business practices,
- They are not excessive in value and cannot be construed as a
bribe, pay-off or kickback,
- They are not in contravention of applicable law or ethical
standards, and
- Public disclosure of the facts will embarrass neither the
Company nor the employee.
(ii) U.S. FOREIGN CORRUPT PRACTICES ACT OF 1977
("FCPA")
CONSOL and its employees are subject to the FCPA, which prohibits
Improper Payments to any non-U.S. Government Official. The terms
"Improper Payments" and "Government Official" are defined in
Section 1.A of this Code. To ensure compliance with the FCPA,
CONSOL has adopted The Foreign Corrupt Practices Act Policy of
CONSOL Energy Inc. Neither CONSOL nor any of its employees may
provide any gift, travel, entertainment, meal, marketing materials,
or anything else of value to any non-U.S. Government Official
unless the requirements of The Foreign Corrupt Practices Act Policy
of CONSOL Energy Inc. are met. Any questions or concerns about the
FCPA should be brought to the attention of CONSOL's Chief Legal
Officer or his/her designee(s).
(iii) HONEST LEADERSHIP AND OPEN GOVERNMENT ACT OF 2007
("HLOGA")
HLOGA significantly limits the offering of gifts and travel to
Members, officers and employees of either House of Congress by
organizations such as CONSOL that employ federal lobbyists. Similar
restrictions apply to the giving of gifts to Federal executive
branch officials under the Ethics in Government Act of 1978. All
employees of CONSOL are subject to these new restrictions and
CONSOL must certify twice each year that its employees understand
and have not violated the Congressional gift/travel rules. In order
to comply with these federal requirements, no gift, meal or
anything else of value may be provided unless it is clearly allowed
under federal gift/travel rules. Any questions or concerns about
HLOGA should be brought to the attention of CONSOL's Legal
Department.
(iv) RECORDS AND DOCUMENTATION
Accounting records and supporting documentation reflecting gifts,
favors, and entertainment to others must be accurately stated,
including appropriate, clear and descriptive text. Departments are
encouraged to establish policies and procedures for approval in
advance of gifts, favors, or entertainment of unusual monetary
value (U.S. tax law limits the deduction for business gifts per
recipient per year).
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C. PAYMENTS RELATED TO SALES
In connection with sales by the Company, commissions, rebates,
discounts, credits, and allowances should be paid or granted only
by the Company on whose books the related sale is recorded, and
such payments should:
- Bear a reasonable relationship to the value of goods delivered
or services rendered,
- Be by check or bank transfer to the specific business entity
with whom the agreement is made or to whom the original related
sales invoice was issued-not to individual officers, employees or
agents of such entity, or to a related business entity,
- Be made only in the country of the entity's place of business,
and
- Be supported by documentation that is complete and that clearly
defines the nature and purpose of the transaction.
Agreements for the Company to pay commissions, rebates, credits,
discounts, or allowances should be in writing; however, when this
is not feasible, the payment arrangement should be supported by an
explanatory memorandum for the file prepared by the approving
department and reviewed by the CONSOL Legal Department.
The intent of the above policy applicable to the payment or
granting of commissions, rebates, discounts, credits and allowances
in connection with sales by the Company is to avoid illegal or
unethical payments, or establishing an environment where these may
inadvertently be made. The business world is complex, however, and
there may be unusual situations in apparent conflict with one or
more of the policy guidelines. Such situations may nevertheless be
acceptable business practice and warrant an exception. Any such
exceptions, including those arising outside the United States and
its territories, should be reviewed with the CONSOL Treasury and
Legal Departments. In all cases, however, CONSOL Internal Auditing
must be informed in advance. There must be no falsification,
misrepresentation, or deliberate overbilling reflected in any
document (including invoices, consular documents, letters of
credit, etc.) involved in the transaction. This includes
suppression or omission of documents or of information in the
documents, or deliberate misdirection of documents.
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D. PAYMENTS RELATED TO PURCHASES
In connection with Company purchases of goods and services,
including commissions related thereto, payments shall:
- Bear a reasonable relationship to the value of goods received
or services rendered,
- Be by check or bank transfer to the specific business entity
that provided the goods or services - not to individual officers,
employees or agents of such entity, or to a related business
entity,
- Be made only in the country of the entity's place of business,
and
- Be supported by documentation that is complete and that clearly
defines the nature and purpose of the transaction.
All such payments shall be consistent with corporate and trade
practice.
Payments for goods and services purchased by the Company are
otherwise subject to the same considerations noted above in the
procedures with respect to payment of commissions, etc., in
connection with sales by the Company. Payments for goods and
services made in the country in which the product was delivered or
service rendered by the vendor are not, per se, considered subject
to special review or a requirement for a written request for
payment from an officer of the payee unless circumstances suggest
the manner of payment might be illegal or unethical.
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E. GIFTS AND PAYMENTS TO EMPLOYEES
Employees shall neither seek nor accept for themselves or others
any gifts, favors, or entertainment without a legitimate business
purpose, nor seek or accept loans (other than conventional loans at
market rates from lending institutions) from any person or business
organization that does or seeks to do business with, or is a
competitor of, the Company. In the application of this policy:
- Employees may accept for themselves and members of their
families common courtesies usually associated with customary
business practices.
- A strict standard is expected with respect to gifts, services,
discounts, entertainment, or considerations of any kind from
suppliers.
- It is never permissible to accept a gift in cash or cash
equivalents (e.g., stocks or other forms of marketable securities)
of any amount.
In certain situations, refusal of personal gifts, favors, or
entertainment (because, for example, they have a value
substantially in excess of customary business practices) can result
in awkward business situations. The propriety of employees
accepting such favors or entertainment or keeping such valuable
gifts for personal use versus turning them over to the Company,
donating them to a charity or other disposition should be discussed
in each case with the employee's management and documented.
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2. CONFLICTS OF INTEREST
Employees should avoid any situation that involves or may
involve a conflict between their personal interests and the
Company's interests. As in all other facets of their duties,
employees dealing with customers, suppliers, contractors,
competitors or any persons doing or seeking to do business with the
Company are to act in the best interests of the Company to the
exclusion of considerations of personal preference or advantage.
Each employee shall make prompt and full disclosure in writing to
his department management of a prospective situation that may
involve a conflict of interest. This includes:
- Ownership by an employee or, to the employee's knowledge, by a
member of the employee's family of a significant financial
interest* in any outside enterprise which does or seeks to do
business with or is a competitor of the Company.
- Serving as a director, officer, partner, consultant, or in a
managerial position with, or employment in a technical capacity by,
any outside enterprise which does or is seeking to do business with
or is a competitor of the Company.
- Acting as broker, finder, go-between, or otherwise for the
benefit of a third party in transactions involving or potentially
involving the Company or its interests.
- Any other arrangement or circumstances, including family or
other personal relationships which might dissuade the employee from
acting in the best interest of the Company.
All information disclosed to management as required by this
policy shall be treated confidentially, except to the extent
necessary to protect the Company's interests.
The key to reviewing potential conflicts is whether the
employee's duties for the Company, or those of his subordinates,
require making decisions that could be influenced by the interest
reported. Other considerations include, but are not limited to
whether or not:
- The outside interest does business or competes with the
employee's department, division, or site.
- The employee has an active, managerial, or decision-making role
in the outside interest.
- The employee has access to Company information potentially
useful to the outside interest.
- Public disclosure of the facts will embarrass the Company.
Conflicts of interest involving real estate, coal, oil and gas
leases, and mineral interests are particularly sensitive. All
employees are prohibited from competing with the Company in its
real estate acquisition or exploration activities, or using Company
information or equipment to enable them to profit, either directly
or indirectly, through the acquisition of mineral leases, royalty
or mineral interests, or real property for the purpose of obtaining
royalty or mineral interests.
* As a minimum standard, a "significant" financial interest
exists in an outside enterprise if:
- (a) the direct or indirect aggregate interest of an employee
and family members is more than 2 percent of any class of the
outstanding securities of the outside enterprise (in the case of a
public company, ownership may be up to 5%),
- (b) an employee or an immediate family member is an officer,
general partner or a trustee of the outside enterprise, or
- (c) the employee's direct or indirect aggregate interest
represents more than 5 percent of the total assets or gross income
of such employee.
In questions of conflict of interest, the term "family" should
be interpreted broadly.
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3. SERVICE IN OUTSIDE ORGANIZATIONS
Employees should not accept a directorship with any for-profit
corporation without the prior specific approval of the Chief Legal
Officer of the Company. Employees should ensure their participation
or service to other organizations, be they civic, charitable,
corporate, governmental, public, private, or non-profit in nature,
do not (a) materially detract from or interfere with the full and
timely performance of their services to the Company, or (b) create
possible conflicts of interest as to the Company.
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4. BUSINESS INFORMATION PROTECTION
All Company employees shall ensure the proper handling,
protection and disposal of business information. Every employee is
responsible for compliance. In addition, supervisory employees are
responsible for compliance by their subordinate employees and
non-employees under their supervision. Business information is a
valuable resource to the Company. Improperly handled or disclosed
business information (whether intentional or inadvertent), may
result in financial damage to the Company; a diminution of our
competitiveness; exposure of the Company, its officers, and its
directors to legal liability; or otherwise adversely affect
shareholders or other stakeholders of the Company. The primary
purpose of this policy is to ensure that employees and others
understand the need to protect business information; provide
guidance in the proper handling of business information; prevent
the unauthorized disclosure or the loss of business information;
and notify employees and others of the possible consequences of
failure to comply with this policy.
To this end, employees shall not:
- Give or release, without proper authority, to anyone not
employed by the Company, or to another employee who has no need for
information, data or information of a confidential nature obtained
while in the Company's employment. This information includes but is
not limited to materials relating to customers, development
programs, costs, marketing, trading, investment, sales activities,
promotion, credit and financial data, manufacturing processes,
financing methods, plans or the business and affairs of the
Company.
- Use nonpublic information obtained while in the Company's
employment (including information about customers, suppliers, or
competitors) for the profit of the employee or other person or
company. This includes, but is not limited to, taking advantage of
such information by (1) trading or providing information for others
to trade in securities, (2) acquiring a real estate interest of any
kind, including but not limited to plant or office sites or
adjacent properties, (3) acquiring (or acquiring options to obtain)
interests in coal, oil and gas leases, royalties, minerals, or real
property for the purpose of obtaining mineral or royalty interests,
or any interest in coal, oil or gas production or profits from the
same, or (4) retaining Company documents or using for any purpose
or revealing to anyone else Company business practices,
confidential information or trade secrets after leaving the
Company's employment.
Employees shall, upon termination of their employment, return to
the Company all memoranda, books, papers, plans, information,
letters and other data, including electronic files, and all copies
thereof or therefrom, which in any way relate to the business of
the Company, except that employees may retain personal notes,
notebooks and diaries.
Improper use of sensitive inside information can be
significantly inhibited by careful control and restriction of
access to such information. Employees who handle particularly
sensitive inside information, and who may not have the background
to understand the legal and corporate implications of the misuse of
such information, should be periodically advised of corporate
policy and the severe legal penalties that can be associated with
misuse of inside information. It is important to remember that
these obligations continue even though a person is no longer
employed by the Company.
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5. FAIR DEALING
Every employee shall deal honestly and fairly with the Company's
directors, officers, employees, customers, suppliers, and
competitors, and shall not take unfair advantage of others through
manipulation, concealment, abuse of privileged information,
misrepresentation of material facts, or other unfair dealing
practices.
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6. INSIDER TRADING
If any employee has material nonpublic information relating to
the Company, neither that person nor any related person may buy or
sell securities of the Company or engage in any other action to
take advantage (directly or indirectly, or for another person's
benefit) of that information. Further, if an employee acquires
material, non public information regarding other companies,
including the Company's customers, suppliers or competitors during
the course of their employment, neither they nor any related person
may buy or sell securities of the other company or engage in any
other action to take advantage (directly or indirectly, or for
another person's benefit) of that information. Transactions that
may be necessary or justifiable for independent reasons (such as
the need to raise money for an emergency expenditure) are no
exception. Even the appearance of an improper transaction must be
avoided to preserve the Company's reputation for adhering to the
highest standards of conduct. Employees should refer to the Policy
Statement on Securities Trades by Directors and Employees of CONSOL
Energy Inc. for further information.
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7. ELECTRONIC INFORMATION
The use of the Company's computer information systems and the
Company data transmitted and/or stored electronically are assets
requiring unique protection. Standards for Electronic Information
Security have been adopted and are available through line
management or CONSOL's Information Systems & Technology
Department. Each employee is responsible for compliance with the
standards and related procedures. Additionally, employees are
required by law to read and comply with the license agreements
associated with the computer software they acquire.
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8. COMPLIANCE WITH THE LAW
All employees are expected to comply with all applicable laws,
rules and regulations including, but not limited to, the
following:
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A. ANTITRUST LAWS
The Company's activities are subject to federal and state
antitrust laws. In general, those laws prohibit agreements or
actions that may restrain trade or reduce competition. Violations
include agreements among competitors to fix or control prices; to
boycott specified suppliers or customers; to allocate products,
territories or markets; or to limit the production or sale of
products. Care must be exercised to ensure that any activities with
representatives of other companies are not viewed as a violation of
any antitrust law. Actions taken by the Company without cooperation
of competitors may also be illegal if they are intended to or tend
to create monopoly power. Because of the complexity of antitrust
laws, the advice of CONSOL's Legal Department should be sought on
all questions regarding this subject.
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B. ANTIBOYCOTT LAWS
Antiboycott laws prohibit participation in, or cooperation with,
international boycotts which U.S. law does not sanction. For
example, it is a violation of U.S. law to refrain from doing
business with boycotted countries or blacklisted persons, or to
furnish information about business relationships of a U.S. person
with such countries or persons. The mere receipt of a request to
engage in any such boycotting activity becomes a reportable event
by law. Such requests should be brought to the attention of
CONSOL's Legal Department.
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C. ENVIRONMENTAL AND SAFETY AND HEALTH LAWS
It is the Company's policy to conduct all operations in such a
manner as to protect and preserve the environment and the health
and safety of employees. To that end, the Company's policy is that
all operations shall be conducted in compliance with all applicable
state and federal environmental and health and safety laws and
regulations. These laws and regulations govern work practices at
all Company sites and the impact of our operations on the air, land
and water. Employees must be scrupulous in the observance of
applicable laws and regulations to avoid risks to the health and
safety of employees, to the environment, and of non-compliance. The
advice of line and staff environmental specialists and CONSOL's
Legal and Environmental Departments in these areas should be
utilized as needed.
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D. EQUAL EMPLOYMENT OPPORTUNITY AND
HARASSMENT
(i)EQUAL EMPLOYMENT OPPORTUNITY
It is the Company's policy to provide equal employment
opportunities to all employees and applicants for employment
without regard to race, color, religion, age, sex, handicap,
disability, national origin, veteran status or any other status or
characteristic protected by applicable law. This applies to, but is
not limited to hiring, placement, upgrading, demotion, transfers,
recruitment or recruitment advertising, layoff or termination, rate
of pay or other forms of compensation, selection for training, and
all other aspects of employment. Please refer to CONSOL's Equal
Employment Opportunity Policy Statement for more information.
(ii) HARASSMENT
Workplace harassment is strictly prohibited and will not be
tolerated. CONSOL is dedicated to ensuring a harassment free
workplace environment for all employees. If employees have any
questions or concerns in the area of equal employment opportunity,
they should bring them to the immediate attention of their
supervisor or CONSOL's Legal Department. Please refer to CONSOL's
Workplace Harassment Policy for more information.
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9. POLITICAL CONTRIBUTIONS
Employees shall not make a contribution of any Company funds,
property or services to any political party or committee, domestic
or foreign, or to any candidate for or holder of any office of any
government -- national, state, local, or foreign. This policy does
not preclude (1) the operation of a political action committee
under applicable laws, (2) Company contributions, where lawful, to
support or oppose public referenda or similar ballot issues, or (3)
Company political contributions, where lawful and reviewed in
advance by CONSOL's head of Government Affairs and approved in
writing by the President or CEO of CONSOL who will advise the Board
of Directors. No direct or indirect pressure in any form is to be
directed toward employees to make any political contribution or
participate in the support of a political party or the political
candidacy of any individual.
This policy is not intended to affect the rights of officers,
employees, and agents of the Company to make personal political
contributions to the party, committee, or candidate of their choice
as long as the donation is derived exclusively from that
individual's personal funds or time and in no way was compensated
directly or indirectly by the Company.
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10. TRAVEL AND ENTERTAINMENT
Travel and entertainment should be consistent with the needs of
the Company's business. Employees are expected to exercise good
judgment, travel on Company business in a cost-efficient manner,
adhere to normal safety requirements, and promptly report any
expenditures incurred. The Company's intent is that an employee
neither loses nor gains financially as a result of business travel
and entertainment. Detailed instructions related to business travel
are documented in the Travel and Entertainment Expense Policy and
Procedures Manual.
Employees who approve travel and entertainment expense reports
are responsible for the propriety and reasonableness of
expenditures, for ensuring that expense reports of their
subordinates are submitted promptly, and that receipts and
explanations properly support reported expenses.
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11. ACCOUNTING STANDARDS AND DOCUMENTATION
It is the Company's policy to comply with all financial
reporting and accounting regulations applicable to the corporation.
All accounts and records shall be documented in a manner that:
- Clearly describes and identifies the true nature of business
transactions, assets, liabilities, or equity, and
- Properly and timely classifies and records entries on the books
of account in conformity with generally accepted accounting
principles.
No record, entry, or document shall be false, distorted,
misleading, misdirected, deliberately incomplete, or
suppressed.
The Company has established internal control standards and
procedures to ensure that assets are protected and properly used
and that financial reports are accurate and reliable. Employees
share the responsibility for maintaining and complying with
required internal controls.
Improper accounting and documentation are not only contrary to
the Company policy but also may be in violation of the accounting
provisions of the U.S. Foreign Corrupt Practices Act of 1977, the
Public Company Accounting and Investor Protections Act of 2002 (the
Sarbanes-Oxley Act of 2002) or other laws or regulations,
potentially involving personal liability, both civil and criminal,
as well as sanctions against the Company.
If any employee has concerns or complaints regarding accounting
or auditing matters of the Company, then he or she shall submit
those concerns or complaints to the Chair of the Audit Committee of
the Board of Directors promptly.
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12. PROTECTION AND PROPER USE OF COMPANY ASSETS
Employees must protect the Company's assets and ensure their
efficient use. Theft, loss, misuse, carelessness, and waste of
assets have a direct impact on the Company's profitability. In
general, all Company assets should be used only for legitimate
business purposes. Occasional, nominal personal use of the
Company's assets is permissible. The Company may, in its
discretion, request reimbursement for the direct costs associated
with such use, misuse or loss.
Although the Company recognizes that nominal personal use of
Company assets may be appropriate, the Company's intellectual and
proprietary information, software applications, product plans,
documentation of business systems and other business data are only
to be used for authorized business purposes.
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13. CORPORATE OPPORTUNITIES
All employees owe a duty to the Company to advance the Company's
legitimate interests when the opportunity to do so arises. An
employee shall not: (a) receive or seek to receive a benefit from
opportunities that are discovered or developed through his or her
involvement with the Company (including, without limitation, his or
her use of the Company's property or information, or his or her
position); (b) use corporate property, information or position for
personal gain; or (c) compete with the Company, directly or
indirectly, for business opportunities.
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14. ANNUAL REPORTING
The Company conducts an annual review of employee compliance
with the Code by surveying management personnel and other employees
who have significant influence or approval authorization over the
areas included in the Code, or who have access to significant
confidential or proprietary information.
Annually CONSOL's Internal Auditing conducts an independent
review of the Company's survey process. The results of this review
will be presented annually by Internal Auditing to CONSOL's Audit
Committee.
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15. COMPLIANCE
Employees are expected to comply with this Code and underlying
policies and procedures. Strict adherence to these standards will
protect the Company and its employees from criticism, litigation or
embarrassment that might result from alleged or real conflicts of
interest or unethical practices. Violations of this Code are
grounds for disciplinary action up to and including discharge and
possible legal prosecution.
Employees should report apparent violations of this Code through
their line organization, CONSOL's Legal Department, Internal Audit
or, if they prefer, to the CONSOL Ethics and Compliance Hotline by
calling 1-800-544-8024. This is a toll-free service that is
available 24 hours a day, 365 days of the year and, though not
intended as a substitute for speaking directly to management, is an
option that allows you to report illegal or unethical behavior or
activity anonymously. The Company will not allow retaliation for
reports made in good faith.
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16. WAIVERS AND EXCEPTIONS
Waivers or exceptions to this Code must conform with applicable
law and regulation and be approved by the Chief Financial Officer
or the Chief Legal Officer , or in the case of executive officers,
by the Company's Board of Directors or an authorized Committee of
the Board. Exceptions or waivers will be granted only after full
disclosure of all material facts and, in the case of executive
officers, will be promptly disclosed to the extent required by law
or regulation.
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17. OTHER POLICIES
Nothing in this Code is intended to alter other legal rights and
obligations of the Company or its employees (such as "at will"
employment arrangements.)
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Effective: May 8, 2013