Code Of Business Conduct

POLICY STATEMENT
It is the policy of Restoration Hardware, Inc. (the "Company") to conduct its affairs according to moral, legal and ethical standards in accordance with all applicable laws, rules and regulations of the countries in which it does business. This Code of Business Conduct (the "Code") applies to the Company's employees, officers and directors (collectively, "Company Associates").

This Code is designed to promote:

  • honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
  • full, fair, accurate, timely and understandable disclosure in the reports and documents the Company files with, or submits to, the Securities and Exchange Commission and in other public communications made by the Company;
  • compliance with applicable governmental laws, rules and regulations;
  • the prompt internal reporting to the appropriate person of violations of this Code; and
  • accountability for adherence to this Code.

Each of the Company Associates is expected to conduct his or her business activities in a truthful, ethical and honest manner, in full compliance with all applicable governmental laws, rules and regulations governing the Company's operations and activities. The Company has established standards for behavior that affect the Company, and Company Associates should pattern their daily performance in compliance with those standards. The Company promotes ethical behavior and encourages Company Associates to talk to supervisors, managers, the Company's Chief Compliance Officer, or other appropriate personnel when in doubt about the best course of action in a particular situation. Additionally, Company Associates should report violations of laws, rules, regulations or the Code to appropriate personnel. Company Associates reporting such violations in good faith will not be subject to retaliation. Any Company Associates involved in or aware of a situation that he or she believes may violate or lead to a violation of this Code should follow the guidelines under "Compliance and Reporting" below.

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 Company Associates. Corporate policies and procedures provide details pertinent to many of the provisions of the Code. Company Associates are expected to be aware of, and to act in accordance with, both the Code and the Company's other policies and procedures at all times. In particular, this Code is in addition to the Company's Employee Handbook and Insider Trading Policy and Guidelines for Disclosure of Material Non-Public Information, each of which may have further, greater or more specific restrictions on the behavior of Company Associates than as set out in this Code. Many of these policies and procedures can be found in the Company's Human Resources Manual or on the Company's intranet by using Microsoft Outlook and looking under Public Folders/Human Resources. Although there can be no better course of action than to apply common sense and sound judgment, do not hesitate to use the resources available whenever it is necessary to seek clarification.

APPROVALS AND WAIVERS
Certain provisions of this Code require Company Associates to act, or refrain from acting, unless prior approval is received from the appropriate person(s). Company Associates requesting approval pursuant to this Code should make such requests for approval in writing to the Chief Compliance Officer. Approvals relating to the Company's directors and executive officers must be obtained from the Company's Board of Directors. All other approvals may be granted by the Chief Compliance Officer. Company Associates may contact the Chief Compliance Officer for additional information on obtaining approvals.

Other provisions of this Code require Company Associates to act, or refrain from acting, in a particular matter and do not permit exceptions based on obtaining an approval. Waiver of those provisions may only be granted by the Board of Directors. Changes in this Code may only be made by the Board of Directors.

CONFLICTS OF INTEREST
A conflict of interest arises any time the personal interests or activities of Company Associates influence his, her or their ability to act in the best interests of the Company. All Company Associates should seek to avoid, eliminate and/or prevent the appearance or occurrence of conflicts of interest between what is in the best interest of the Company and what could result in material personal gain for the affected individual(s) in the Company. All Company Associates should seek to avoid any activity, transaction, association, relationship, agreement or situation that may have an adverse effect on his, her or their ability to serve the Company. All Company Associates must discharge their responsibilities solely on the basis of what is in the best interest of the Company and independent of personal considerations or relationships. Company Associates must disclose any potential conflicts of interest to the Chief Compliance Officer or such officer's designees, who, consulting with counsel, will advise the applicable individual as to whether or not the Company believes a conflict of interest exists. Company Associates should also disclose potential conflicts of interest involving an individual's spouse, siblings, parents, in-laws, children, life partner and members of the individual's household. Company Associates should not make or influence any decision that could directly or indirectly benefit his, her or their close relative and, in order to protect Company Associates and the Company from the appearance of a conflict of interest, Company Associates should make appropriate disclosure of the interest to the Chief Compliance Officer or such officer's designee.

CORPORATE OPPORTUNITIES & RESOURCES
Company Associates are prohibited from taking for themselves personal opportunities that are discovered through the use of corporate property, information or position without approval. Without approval, no Company Associates may use corporate property, information or position for improper personal gain, and no Company Associates may compete with the Company directly or indirectly except as permitted by Company policies.

All Company Associates should protect the Company's assets and ensure their efficient use. Theft, carelessness and waste have a direct impact on the Company's profitability. All Company assets should be used for legitimate business purposes.

Company resources may be used for minor personal uses so long as such use is reasonable, does not interfere with the duties of the applicable Company Associates, is not done for pecuniary gain, does not conflict with the Company's business and does not violate any Company policy.

BUSINESS RELATIONSHIPS
The Company seeks to outperform its competition fairly and honesty. The Company seeks competitive advantages through superior performance, not unethical or illegal business practices. Company Associates should endeavor to deal honestly, ethically and fairly with the Company's customers, suppliers, competitors and employees. None should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any unfair-dealing practice.

FAIR COMPETITION
Fair competition laws, including the U.S. antitrust rules, limit what the Company can do with another company and what the Company can do on its own. Generally, the laws are designed to prohibit agreements or actions that reduce competition and harm consumers. Company Associates may not enter into agreements or discussions with competitors of the Company that have the effect of fixing or controlling prices, dividing and allocating markets or territories, or boycotting suppliers or customers. U.S. and foreign antitrust laws also apply to imports and exports. In that regard, Company Associates should consult with the Chief Compliance Officer and the Company's counsel when questions arise.

GIFTS, GRATUITIES, ENTERTAINMENT AND OTHER CONSIDERATIONS
Use of Company funds or other Company property for illegal, unethical or otherwise improper purposes is prohibited. The purpose of business entertainment and gifts in a commercial setting is to create goodwill and a sound working relationship, not to gain advantage with customers or suppliers.

Loans. Company Associates may not accept loans from any person or entities having or seeking business with the Company. Executive officers and directors may not receive loans from the Company, nor may the Company arrange for any loan. A loan from a financial institution in the ordinary course at normal interest rates prevailing at the time of borrowing is permissible.

Bribes and Kickbacks. The use of Company funds, facilities or property for any illegal or unethical purpose is strictly prohibited; provided, that certain facilitating payments discussed in "Doing Business Internationally" are permitted.

  • No Company Associates or agents are permitted to offer, give or cause others to give, any payments or anything of value for the purpose of influencing the recipient's business judgment or conduct other than facilitating payments;
  • Company Associates may not solicit or accept a kickback or bribe, in any form, for any reason.

DOING BUSINESS INTERNATIONALLY
The Company is committed to the highest business conduct standards wherever it operates. The Company observes these standards worldwide, even at the risk of losing business. While no one can anticipate all the situations that may present challenges to Company Associates doing business in the worldwide marketplace, the following guidelines always apply:

  • Observe all laws and regulations, both U.S. and non-U.S., that apply to business abroad.
  • Paying bribes to government officials is absolutely prohibited, even if those bribes are common practice, except for facilitating payments. Company Associates may not give, promise to give or authorize the giving to a foreign official, a foreign political party, or official thereof or any candidate for foreign political office any money or offer, gift, promise to give or authorize the giving of anything of value to influence any act or decision, to induce such official, party or candidate to do or omit to do any act in violation of the lawful duty of such official, party or candidate, or to induce such official, party or candidate to use his or her influence with a foreign government or agency to affect or influence any act or decision of such foreign government or agency.
  • Do not cooperate with illegal boycotts.
  • Observe all licensing requirements and the requirements of applicable import and export control laws.

The laws governing the Company's business in foreign countries are extensive and complex, and may be different from those in the United States. No new Company products (or, if applicable, services) should be offered in any country other than the United States and Canada without prior approval, and then only in accordance with the applicable local country's regulations and requirements.

FACILITATING PAYMENTS TO LOW-LEVEL NON-U.S. GOVERNMENTAL EMPLOYEES AND OFFICIALS FOR NON-DISCRENTIONARY ACTION
As noted above, the Company is committed to complying with the laws of the countries where it operates. In some countries, a very limited category of small payments to facilitate or expedite routine nondiscretionary governmental actions may be permitted as exceptions to anti-bribery laws, including the U.S. Foreign Corrupt Practices Act. The requirements pertaining to such payments are complex. Company Associates engaged in international business activities should be familiar with the rules regarding this type of payment and must obtain prior approval of the Chief Compliance Officer before making any such payment.

These "facilitating payments" to non-U.S. governmental officials are distinguished from payments made to influence a discretionary decision or to cause violation of, or an act in conflict with, the interests of an individual's employer, which are strictly prohibited.

Anti-boycott Compliance. The United States has enacted anti-boycott regulations which make it unlawful for U.S. persons to participate in any activity that could have the effect of promoting or supporting a boycott or restrictive trade practice of another country against customers or suppliers located in a country friendly to the U.S. or against a U.S. person, firm or corporation. Boycott issues arise most frequently in connection with the Arab boycott of Israel. Prohibited actions include, but are not limited to, furnishing information about business relationships with boycotted countries, or information about race, religion, sex or national origin. Any request to participate in such activity should be immediately reported to the Chief Compliance Officer or the officer's designee.

POLITICAL CONTRIBUTIONS AND LOBBYING
No political contributions are to be made using the Company's funds or assets, or the funds or assets of any subsidiary of the Company, to any political party, political campaign, political candidate or public official in the United States or any foreign country, unless the contribution is lawful and expressly authorized in writing. In addition, no Company Associates may make a political contribution on behalf of the Company or its subsidiaries, or with the appearance that such contribution is being made on behalf of the Company or its subsidiaries, unless expressly authorized in writing. A "contribution" is any direct or indirect payment, distribution, loan, advance, deposit, or gift of money, services or anything of value in connection with an election or to an organization or group formed to support or defend a referendum or ballot issue.

ACCURACY OF REPORTS, RECORDS AND ACCOUNTS
All Company Associates are responsible for the accuracy of their respective records, time sheets and reports. Accurate information is essential to the Company's ability to meet legal and regulatory obligations and to compete effectively. The records and books of account of the Company shall meet the highest standards and accurately reflect the true nature of the transactions they record.

Business transactions must be properly authorized and completely and accurately recorded on the Company's books and records in accordance with generally accepted accounting principles and established Company financial policy. Company Associates must not create false or misleading documents or accounting, financial or electronic records for any purpose, and no one may direct Company Associates to do so. For example, expense reports must accurately document expenses actually incurred in accordance with Company policies.

No undisclosed or unrecorded account or fund shall be established for any purpose. No false or misleading entries shall be made in the Company's books or records for any reason. No disbursement of corporate funds or other corporate property shall be made without adequate supporting documentation or for any purpose other than as described in the documents. All Company Associates shall comply with generally accepted accounting principles and the Company's internal controls at all times. Company records shall be retained or disposed of in accordance with applicable legal and regulatory requirements.

INSIDER TRADING; COMMUNICATIONS WITH THIRD PARTIES
Company Associates who have access to confidential information are not permitted to use or share that information for stock trading purposes or for any other purpose except the conduct of the Company's business. To assist in complying with this policy, the Company has adopted an Insider Trading Policy and Guidelines for Disclosure of Material Non-Public Information.

Insider Trading. Inside information is material information about a publicly traded company that is not known by the public. Information is deemed "material" if it could affect the market price of a security or if a reasonable investor would attach importance to the information in deciding whether to buy, sell or hold a security. Inside information typically relates to financial conditions, such as progress toward achieving revenue and earnings targets or projections of future earnings or losses of the Company. Inside information also includes changes in strategy regarding a proposed merger, acquisition or tender offer, new products or services, contract awards and other similar information. Inside information is not limited to information about the Company. It also includes material non-public information about others, including the Company's customers, suppliers, and competitors.

Insider trading is prohibited by law. It occurs when an individual with material, non-public information trades securities or communicates such information to others who trade. The person who trades or "tips" information violates the law if he or she has a duty or relationship of trust and confidence not to use the information.

Trading or helping others trade while aware of inside information has serious legal consequences, even if the Insider does not receive any personal financial benefit. Insiders may also have an obligation to take appropriate steps to prevent insider trading by others.

Confidential Information. Company Associates should maintain the confidentiality of information entrusted to them by the Company or its vendors or customers, except when disclosure is authorized or legally mandated. Confidential information includes all non-public information, including information that might be of use to competitors, or harmful to the Company or its vendors or customers if disclosed.

COMPLIANCE AND REPORTING
Compliance.
Any Company Associates who violate the provisions of this Code will be subject to disciplinary action, up to and including termination or removal from office. Willful disregard of criminal statutes underlying this Code will be dealt with swiftly and may require the Company to refer such violation for criminal prosecution or civil action.

Reporting Procedures and Other Inquiries. Questions regarding the policies in this Code may be directed to the Chief Compliance Officer or the Company's counsel. The Chief Compliance Officer shall be the Chief Financial Officer of the Company or such other person as the Board of Directors or Audit Committee may designate from time to time. Managers and supervisors provide timely advice and guidance to employees on ethics and compliance concerns and are expected to take a leadership role in promoting ethical business conduct. Any Company Associates having knowledge of, or questions or concerns about, an actual or possible violation of the provisions of this Code should promptly report the matter to his or her immediate supervisor, to a member of management of the Company, through the Company's Direct Line Program or to the Company's Chief Compliance Officer. The Company's Chief Compliance Officer may reached as follows:

Chris Newman
Chief Compliance Officer
Restoration Hardware, Inc.
15 Koch Road, Suite J
Corte Madera, California 94925
Tel. (415) 924-1005
Fax (415) 927-7264

In addition, Company Associates may submit reports of actual or possible violations of the provisions of this Code, and concerns and information regarding the Code, directly to the Audit Committee of the Board of Directors. All submissions by employees in connection with the Code may be made on an anonymous basis and shall be treated as confidential by the Audit Committee. Employees may forward reports to the Audit Committee as follows:

By email
By voicemail at: (877) 737-8600, ext. 4576.

When submitting a report, Company Associates are asked to provide as much detailed information as possible. Providing detailed, rather than general, information will greatly assist the Company in effectively investigating complaints. This is particularly important where a person submits a complaint on an anonymous basis, as the Company will be unable to contact the reporting individual with requests for additional information or clarification.

The Company is providing the anonymous reporting procedures so that the Company's employees may disclose genuine concerns without feeling threatened. The Company prohibits retaliation or retribution against any employee who in good faith submits a report under this Code. Employees and others submitting information under this Code who choose to identify themselves when submitting a report may be contacted by the Chief Compliance Officer or other representative of the Company in order to gain additional information. The Company will keep confidential to the extent permissible under applicable law all communications with a reporting individual relating to the individual's report.

All conversations, calls and reports made under this Code in good faith will be taken seriously. However, Company Associates who file reports or provide evidence that they know to be false or without a reasonable belief in the truth and accuracy of such information will not be protected by this policy and may be subject to corrective action, up to and including immediate termination or removal from office.

Other Important Contact Information.
Human Resources Department:
Director of Human Resources
Tel. (415) 945-4651

This document is not an employment contract between the Company and its employees, nor does it modify their employment relationship with the Company.

This Code is intended to clarify each employee's, officer's and director's existing obligation for proper conduct. The standards and the supporting policies and procedures may change from time to time in the Company's discretion. Each employee, officer and director is responsible for knowing and complying with the current laws, regulations, standards, policies and procedures that apply to the Company's work. The most current version of this document can be found in the Company's Human Resources Binder or on the Company's intranet by using Microsoft Outlook and looking under Public Folders/Human Resources.