Layout 1

AN ASSOCIA

TE GUIDE TO THE PETSMAR

CODE OF ETHICS AND BUSINESS CONDUCT

business

code of ethics &

c nduct

Table of Contents

Letter from the Chairman and CEO .................................................................3

PetSmart Code of Ethics ...................................................................................... ..4

General Directions, Reporting and Certification ...........................................5

Quick Reference Policy Summaries....................................................................7

Business Policy Statements .................................................................................. 10

Antitrust Compliance ..........................................................................................................10

Asset Protection..................................................................................................................13

Pet Care and Safety ............................................................................................................14

Respect in the Workplace...................................................................................................15

Conflicting Interests.............................................................................................................16

Policy to Conduct Business Legally and Ethically and to

Maintain Accurate and Meaningful Financial Records........................................................20

Occupational Health and Safety..........................................................................................21

Environmental ....................................................................................................................22

Computer Usage................................................................................................................22

olitical Contributions and Public Service ............................................................................24

Compliance Program Administration and Information ............................... 25

Code of Ethics and Business Conduct Associate Certification ............27

CODE OF ETHICS AND BUSINESS CONDUCT

Dear Fellow Associate,

I am pleased to share with you the PetSmart Code of Ethics and Business Conduct. It contains

the policies that guide our actions, day to day. It reaffirms our commitment to the highest level

of ethical and legal conduct, which has served the Company well through our history.

This guide is designed as a resource. It gives you basic information about some of the more

important legal and policy standards that apply to you. It provides direction and limits. It

explains how to prevent or recognize and report potential violations. Adherence to these

guidelines is a requirement of continued employment for each of us.

Unethical or illegal conduct, even by one of us, ultimately can jeopardize the integrity of

PetSmart. Associates who violate these policies, whether for personal gain, perceived benefit

to the Company or for any other reason, will discredit all of us. As an informed Associate, you

can help prevent this by recognizing and reporting potential violations.

This guide cannot address all possible situations. You should use this reference and your own

good judgment when making choices and decisions. If you are in doubt or need assistance,

see the Compliance Program Administration and Information on page 25 of this guide or

contact the CareSmart Line at 1-800-738-4693.

After you have studied the contents of the guide, please complete the Code of Ethics and

Business Conduct Associate Certification Form in the manner described at the end of this

guide. You will periodically be asked to complete this Form to reaffirm your continued

understanding of and compliance with this Code.

Our achievements as a Company and as individuals require hard work and constant dedication

to high standards. As we strive to grow and improve our business, upholding these standards

is one of our most important priorities.

Sincerely,

Philip L. Francis

Chairman of the Board

Chief Executive Officer

April 2006

PETSMART CODE OF ETHICS

PetSmart Code of Ethics

PetSmart believes it is imperative to: act with honesty and

integrity and engage in ethical conduct; avoid conflicts of

interest and disclose transactions or relationships that

could give rise to such a conflict; conduct our business in

accordance with all applicable laws, rules and regulations;

adhere to standards of safety and care for the protection

of our Associates, customers and their pets, the public

and the environment; provide information in all reports

and documents that is complete, fair, accurate, timely

and understandable; and promote these policies through

education, supervision and regular reviews.

General Directions

All Associates must read, understand

and use the PetSmart Code of Ethics

and Business Conduct (the “Code”) and

related policies. Every Associate has the

responsibility to recognize and avoid

or prevent situations that may cause

possible violations of the Code. If, after

reviewing the information in this guide

or PetSmart’s business policies, you

have questions about its content or

about how it relates to your job, you

should consult with your manager. If

your manager cannot answer your

questions, then your manager should

direct the question to his or her

supervisor or the Legal Department.

Reporting

An essential element of this Code is the

responsibility and obligation you have as

an Associate to appropriately raise issues

of concern to appropriate individuals in

the Company. Issues of concern may

include a violation of this Code or any

other Company policy

, pet safety

concerns, harassment, discrimination, or

issues surrounding our financial records.

The Company has an open door policy,

which encourages Associates to raise

issues to an appropriate supervisor who

will address the issue.

Additionally, an Associate can anonymously

report an issue of concern through the

CareSmart Line, which is a call center

operated by a third-party. Our Legal

Department and Chief Compliance

Officer can be contacted directly to discuss

any issue of concern. Any issue reported

will be taken seriously and addressed

appropriately. Supervisors/Managers in

receipt of an issue of concern must take

appropriate action to address such issue.

When applicable, the issue should be

elevated to other appropriate individuals

to address.

In summary, it is imperative to report

violations of Company policy to an

appropriate individual. Failure to do so,

or failure to take appropriate action

when in receipt of an issue of concern,

is a violation of the Code.

Finally, every Associate has access to the

etSmart Audit Department at Store

Support Group, and the Vice P

resident

GENERAL DIRECTIONS, REPORTING AND CERTIFICATION

General Directions,

Reporting and Certification

GENERAL DIRECTIONS, REPORTING AND CERTIFICATION

of Internal Audit periodically reports to

the Audit Committee of the Board of

Directors on issues covered by the Code.

Management will work with Associates

to resolve reported matters where

appropriate. However, neglect of job

responsibilities or violations of the law

will never be condoned. These policies

must be followed and any Associate’s

failure to comply with them may

result in disciplinary action, up to and

including dismissal.

Certification

Every salaried and certain other

designated Associates must review,

sign and forward the Code of Ethics and

Business Conduct Associate Certification

Form following the procedure described

at the end of the Code.

If you are at SSG, Associates will be

required to reaffirm their understanding

of the Code of Ethics and Business

Conduct by re-reading and completing

the Associate Certification Form

periodically (either online or using a

Certification Form). Any comments or

concerns should be reported on the

Certification Form or through the

CareSmart Line.

The Code of Ethics and Business

Conduct in this guide applies to

PetSmart and its subsidiaries. All

references to “PetSmart” and “the

Company” include PetSmart, Inc.,

its subsidiary companies, all affiliates

controlled by PetSmart or, if appropriate,

any one or more of them. All references

to “close relatives” would also include

anyone with whom an Associate has

a close relationship.

Antitrust Compliance

Policy

It is the policy of PetSmart to comply

with the antitrust laws of the United

States and with the laws regulating

competitive practices in all locations

where the Company does business.

This policy identifies and discusses how

Associates can avoid illegal and unethical

interactions with customers, suppliers

and competitors in situations involving

unlawful agreements, discriminatory

and predatory pricing, reciprocity, etc.

Asset Protection Policy

It is the policy of PetSmart to have

controls that will aid in the detection

and prevention of fraud against the

Company. This policy is designed to

address intentional false representations

and the concealment of material facts for

the purpose of inducing another to act

upon it to his, her or the Company’s

detriment or injury.

Pet Care and Safety Policy

It is the policy of PetSmart to maintain

high standards for the humane care and

treatment of pets. We seek to accomplish

this by ensuring all pet care procedures

are followed, by reporting and addressing

infractions and by encouraging our

customers to report to us any problems

they see.

Respect in the Workplace

Policy

It is the policy of PetSmart to provide

equal employment opportunity for all

Associates based solely on the

qualifications of each individual. This policy

describes and prohibits any form of

discrimination, harassment or retaliation

based on race, color, religion, age, sex,

pregnancy, sexual orientation, national

origin, veteran status, disability or other

protected status. The policy emphasizes

that no such discrimination or harassment

will be tolerated at PetSmart and we will

not retaliate against Associates who report

harassment or discrimination.

Quick Reference Policy

Summaries

The following descriptions provide a brief summary of each business policy.

For complete information, refer to the policy statements beginning on page 10.

QUICK REFERENCE POLICY SUMMARIES

Policy on

Conflicting Interests

It is the policy of PetSmart to prevent

situations in which an Associate’s

interests are in conflict with those of the

Company. This policy explains the

responsibility of Associates and their

family members to avoid any action that

may interfere with the Associate’s

primary duty to serve the Company at all

times. Examples of areas covered

include illegal payments or gifts;

interactions with vendors, suppliers,

customers and competitors; and

securities trades and confidential

information.

Policy to Conduct

Business Legally and

Ethically and to Maintain

Accurate and Meaningful

Financial Records

It is the policy of PetSmart to conduct

its business both ethically and legally and

to present its financial information in a

manner that will not mislead or misinform

those who receive and use it. This policy

explains improper use of corporate funds

to gain favorable treatment by regulatory

authorities and describes the

requirements for maintaining and

reporting financial information.

Occupational Health

and Safety Policy

It is the policy of PetSmart to establish

and maintain a safe and healthy work

environment. This policy covers the

responsibility of management and

Associates to minimize the hazards

inherent in the workplace by using

appropriate processes, practices and

methods, and by providing timely

education and training.

Environmental Policy

It is the policy of PetSmart to comply

with the environmental, health and safety

laws in the conduct of its business and to

exemplify the best contemporary industry

practices with respect to environmental

matters. The policy reviews the

Company’s commitment to continuous

improvement of our environmental

protection practices and to manage

environmental performance through

cooperation and active participation.

QUICK REFERENCE POLICY SUMMARIES

Computer Usage Policy

It is the policy of PetSmart to utilize

common sense and good judgment while

using email, internet, local area networks,

network drives, software and hardware,

and to ensure Company information is

not inappropriately accessed or shared on

chat rooms or blogs. The policy reviews

each Associate’s obligations when using

these services.

Public Contributions and

Public Service Policy

It is the policy of PetSmart to encourage

Associates to be actively involved in the

civic affairs of the communities in which

they live. This policy discusses restrictions

on political contributions and provides

guidance for individuals who speak on

behalf of the Company.

Antitrust

Compliance Policy

PetSmart complies with the antitrust

laws of the United States (“U.S.”),

and the local laws regulating

competitive practices.

The purpose of the antitrust laws is to

preserve our competitive free enterprise

system. These laws are based on the

belief that the public interest is best

served by vigorous competition and

will suffer from agreement or collusion

between competitors.

The antitrust laws are complex and in

many respects difficult to interpret and

apply. Associates in responsible positions,

however, should clearly understand these

basic principles and should seek advice

when uncertain. Associates should consult

the PetSmart Legal Department with

any questions or concerns pertaining

to the policy.

Impermissible Agreements

The Sherman Act and the Clayton Act

are the principal United States antitrust

laws. The following actions constitute

clear violations of one or both of

these statutes:

Impermissible Agreements

with Competitors:

1. To agree with one or more of our

competitors to fix prices or service

charges at existing levels, higher

levels or lower levels.

2. To agree with one or more of our

competitors on what to bid or pay

for any product or service, i.e., any

form of bid rigging.

3. To agree with one or more of our

competitors to fix other items and

conditions of sale, such as credit

terms, quantity discounts, freight,

packaging, etc.

4. To agree with one or more of our

competitors on the allocation of

customers or markets, whether

geographically or otherwise.

Impermissible Agreements with

Suppliers and Customers:

5. To obtain the agreement of any

supplier (i.e., any individual or

organization who sells products to

the Company) to fix resale prices, or

other terms and conditions of resale.

Business Policy Statements

BUSINESS POLICY STATEMENTS

Depending on the circumstances, the

following actions may be in violation of

the antitrust laws. Associates should

seek the advice of the PetSmart Legal

Department before taking any of the

following actions:

6. To agree with competitors or

suppliers not to deal with any other

person, whether that person is a

supplier, competitor or customer,

for example, a group boycott.

7. To force any customer to buy an

article as a condition of buying

another article (such as a tie-in sale);

to obtain the agreement of the

customer that it will buy all of its

product from the Company; or to

refuse to sell an article to any

customer unless it buys another

article or all of its products from

the Company.

8. To purchase goods or services from

a supplier on the condition that it will

purchase other goods or services

from the Company, which is known

as a reciprocal agreement.

Evidence of Agreements

with Competitors

or Suppliers

You should know that even if you clearly

understand and follow these antitrust

guidelines, actions you take in good

faith, with no intent to violate the law,

may nevertheless be violations. For

example, uniform prices alone are not

sufficient evidence to establish an antitrust

violation. On occasion, however, a judge

or jury has inferred an illegal agreement

or understanding with little

additional evidence.

These are the safest rules for

everyday business situations:

1. Don’t discuss prices, costs or suppliers

with a competitor. A competitor can

be any person or Company that

competes with any part of our

business. Don’t complain to suppliers

about another competitor’s resale

prices. If you are contacted by a

competitor complaining about the

Company’s prices or another

competitor’s prices, do not engage

in discussions. Instead, call the Legal

Department immediately or the toll

free CareSmart number at

1-800-738-6373.

BUSINESS POLICY STATEMENTS

2. Don’t discuss retail prices with

suppliers, and do not discuss

another competitor’s resale

prices with a supplier.

3. Don’t make statements to one

competitor complaining of price

cutting or inquire of a competitor

about whether it had quoted a

given price, even if the purpose

of the inquiry is to minimize the

risk of price discrimination.

(See Discriminatory Pricing below.)

4. Don’t have discussions (whether

face-to-face, over the telephone,

via email or in a chat room) with a

competitor concerning general

market conditions, present or future

prices, quantity discounts or other

terms of sale, or any supplier or

group of suppliers.

5. Don’t exchange current or future

price schedules with a competitor.

6. Don’t attend formal or informal

meetings of competitors (whether

held in a restaurant, hotel, club or

elsewhere). This applies especially to

a trade association “rump” session

at which any business matters are

discussed, unless either legal counsel

is present or the discussions are

limited to specific approved topics.

7. Don’t discuss costs with a competitor.

8. Don’t discuss with a customer its

purchase of other products if the

discussion is perceived to be a

threat, no matter how subtle, of

discontinuing sales to that customer if

it does not purchase other products.

In all of these cases, there is the risk

that, even though there may be no

illegal agreement or understanding, a

judge or jury might decide there has

been a violation. You should avoid any

action that may violate the antitrust laws,

but also any action that may give the

appearance of doing so.

Pricing Integrity

Discriminatory Pricing

The Robinson-Patman Act prohibits:

1. Price discrimination or differences

in price between purchasers of

products of like grade and quality

that may harm either competitors

or customers who pay the higher

prices. There are two basic

exceptions. One relates to “meeting

competition” situations, where a

lower price is granted in good faith

to meet, but not beat, a competitor’s

lawful lower price. In addition,

quantity discounts are permissible

where most, if not all, customers

BUSINESS POLICY STATEMENTS

can buy enough to take advantage

of the maximum discount. The other

exception, which is rarely available,

is when we can offer a lower price

when we realize cost savings in

dealing with a particular customer.

2. Commission or brokerage payments

to a customer, agent or representative

of a customer.

3. Discriminatory services, facilities or

payments to help a purchaser obtain

services or facilities. The services or

facilities referred to are those used

by the purchaser in the resale of

the product.

4. Inducing or receiving discriminatory

prices. This relates to a purchaser’s

conduct rather than a seller’s conduct.

The Robinson-Patman Act is difficult to

understand and apply. If you have

questions, contact the Legal Department

for advice.

Predatory Pricing

The antitrust laws of the U.S. prohibit

below-cost pricing if it is part of an effort

to gain or maintain a dominant market

position. In addition, the laws of some

states make sales below cost unlawful

even where the Company doesn’t have

market power. There may be some

circumstances where below

-cost

pricing can be justified. Advice of

the Legal Department should always

be sought prior to any product or

service being offered or purchased

at below cost.

Reciprocity

Reciprocity (i.e., reciprocal buying) is

an unsound business practice that

frequently distorts purchasing decisions.

It is the policy of PetSmart to purchase

and sell products and services based on

superior quality, suitability, efficiency,

service and price. No attempt should

be made to position purchases or

potential purchases to promote sales

to any suppliers.

Asset Protection Policy

The corporate asset protection policy is

established to facilitate the development

of controls that will aid in the detection

and prevention of fraud against

PetSmart. It is the intent of PetSmart to

promote consistent organizational

behavior by providing guidelines and

assigning responsibility for the

development of controls and the

conduct of investigations.

This policy applies to any irregularity,

or suspected irregularity, involving

Associates as well as shareholders,

consultants, vendors, contractors,

BUSINESS POLICY STATEMENTS

and/or other parties with a business

relationship with the Company including,

but not limited to, such things as any

impropriety in handling or reporting

money or financial transactions.

Any investigative activity required will be

conducted without regard to the

suspected wrongdoer's length of

service, position/title, or relationship to

the Company. The Company has a

responsibility to detect and prevent

fraud, misappropriations and other

irregularities. Fraud is defined as the

intentional, false representation, or

concealment of a material fact for the

purpose of inducing another to act upon it

to his or her injury. Associates should be

familiar with the types of improprieties

that might occur within his or her area of

responsibility and be alert for any

indication of irregularity. Any irregularity

that is detected or suspected must

be reported immediately to the

CareSmart Line.

Complaint protocols have been

established under the CareSmart Line

for the investigation of all suspected

fraudulent acts as defined in the policy.

The investigator will have access to all

PetSmart records and personnel. If the

investigation substantiates that fraudulent

activities have occurred, the lead

investigator will issue reports to

appropriate recipients and, if required,

to the Board of Directors through the

Audit Committee in accordance with the

complaint protocol process. Investigation

results will remain confidential, unless

otherwise required by law, and will only

be discussed with appropriate parties.

Pet Care and Safety

Caring for pets is fundamental to who

we are, and each of us is responsible to

meet and maintain our high standards

for humane pet care and treatment.

PetSmart believes it is unacceptable for

even one pet, in even one PetSmart

store, to receive the wrong kind of care

or inadequate care.

Store Management is responsible for

communicating all pet care policies and

procedures to all Associates who handle

or care for our pets and ensuring they

are followed. Store Management is also

responsible for reporting humane pet

care violations to their District Managers

immediately upon learning of any

infraction. All Managers will annually be

asked to sign an acknowledgement

regarding the pet care and safety in

our stores.

We feel so strongly about caring for pets

in our stores that in each pet habitat area

there must be displayed a sign with a

toll-free telephone number for customers

BUSINESS POLICY STATEMENTS

to use to report any issues or concerns

about how we care for our pets.

Our policy strictly prohibits inhumane

treatment of any pet in our care and

requires Associates to follow the

Company’s written procedures for

handling pets.

Any ill or injured pets must be removed

from the sales floor immediately and not

returned until they are completely healthy.

Associates are required to seek

veterinary care for pets with anything

beyond a minor injury or illness, or

when the Associate is uncertain about

the pet’s condition.

PetSmart Associates are required to

report any instance of perceived

inhumane pet treatment to their Pet

Care Manager, Store Manager, District

Services Manager or District Manager.

All concerns will be investigated

immediately. Inhumane treatment of our

pets, or failure to report it when seen, is

not tolerated and is grounds for

immediate termination.

Respect in

the Workplace

It is the policy of PetSmart to provide

equal employment opportunity for all

Associates based solely on the

qualifications of each individual. This

policy describes and prohibits any form

of discrimination, harassment or

retaliation based on race, color, religion,

age, sex, pregnancy, sexual orientation,

national origin, veteran status, disability

or other protected status. The policy

emphasizes that any such discrimination

or harassment will be not be tolerated

at PetSmart and there will be no

retaliation against Associates who report

harassment or discrimination.

No manager or supervisor may threaten

or suggest, either explicitly or implicitly,

that an Associate’s submission to or

rejection of sexual advances or requests

for sexual favors will either enhance or

adversely affect the Associate’s

employment. This includes Associate

evaluation, compensation, advancement,

assigned duties, or any other terms or

conditions of employment.

PetSmart policy and the law prohibit

any Associate from making derogatory

or degrading gestures or actions, or

using demeaning words concerning an

Associate’s race, color, religion, age, sex,

pregnancy

, sexual orientation, national

BUSINESS POLICY STATEMENTS

origin, veteran status, disability or other

protected status. Unwelcome sexual

advances, requests for sexual favors,

and other verbal or physical conduct

of a sexual nature are also prohibited.

Conflicting Interests

It is the policy of PetSmart to prevent

situations in which an Associate’s

interests are in conflict with those of the

Company. This policy explains the

responsibility of Associates and their

family members to avoid any action that

may interfere with the Associate’s

primary duty to serve the Company at

all times. Examples of areas covered

include illegal payments or gifts;

interactions with vendors, suppliers,

customers and competitors; securities

trades; and confidential information.

Each PetSmart Associate has a duty to

be free at all times from any influence

that conflicts or appears to conflict with

the interests of the Company, or that

might deprive the Company of the

undivided loyalty of the Associate in

business dealings. To this end, an

Associate should not become involved

in any situation that may interfere with

his or her primary duty to serve the

Company at all times to the best of his

or her ability. Associates who should be

especially mindful of this duty include all

who may:

• have authority to purchase or sell

goods or services on behalf of the

Company;

• recommend or influence decisions

with respect to purchases or sales; or

• have knowledge of or access to the

Company’s confidential information,

processes or activities.

It is impossible to present an exhaustive

list of actions that might give rise to a

conflict of interest. The following

guidelines should help indicate some,

but not all, areas where conflicts of

interest are most likely to arise:

1. Bribes, Kickbacks and

Other Payments

An Associate will not offer, accept or

pay any bribe, kickback or illegal gratuity

or payment, directly or indirectly, to or

from any person, organization or

governmental representative.

2. Financial Interests in Suppliers,

Customers or Competitors

A conflict of interest may exist where

an Associate or a close relative of an

Associate has a financial interest in, or is

engaged, directly or indirectly, in the

management of an organization that

deals with the Company as a vendor

supplier or contractor of the Company

BUSINESS POLICY STATEMENTS

or is a competitor of the Company.

The term “financial interest” means any

interest, direct or indirect, in the financial

success or failure of an enterprise,

regardless of the nature of that interest

or the manner of its acquisition. It

includes, for example, owning stock,

being a partner, being a creditor, or

any other arrangement in which an

Associate or close relative of an

Associate has an interest in or claim on

the assets or income of an enterprise.

A conflict of interest is unlikely, however, if

the financial interest is insubstantial and

consists solely of stocks or bonds listed

on a national security exchange or

customarily bought and sold in an over-

the-counter market. A financial interest

may be considered “substantial” if it

represents more than one percent of

the common stock of the enterprise

in which the investment is made, or if

it is a significant part of an Associate’s

or close relative’s assets.

3. Transactions or Competition

with the Company

A conflict of interest may exist where an

Associate or close relative of an

Associate buys, sells or leases any kind

of property, facilities, equipment or

services from or to, or in competition

with, the Company. A conflict may also

exist where any close relative of an

Associate renders services to the

Company other than as an Associate

or where an Associate seeks to direct

Company purchases or other transactions

to or through a close relative.

4. Transactions with Persons Doing

or Seeking to do Business with

the Company or in Competition

with the Company

A conflict of interest may exist where an

Associate or a close relative of an

Associate buys, sells or leases any kind

of property, facilities or equipment from

or to any organization or individual who

is doing or seeking to do business with

the Company or is a competitor of the

Company, or where he or she accepts

commissions, a share in profits, or

compensation in any form from any

such organization or individual.

5. Providing Services to Other

Organizations or Individuals

A conflict of interest may exist where an

Associate provides services to another

organization or individual that does

business with or is seeking to do

business with PetSmart or is a

competitor of PetSmart, or if the outside

employment interferes with the

Associate’s performance of duties for

the Company.

BUSINESS POLICY STATEMENTS

6. Gifts or Loans

An Associate should not accept gifts or

favors of significant value (cost more

than $50) or borrow money (other than

from an established banking or financial

institution), directly or indirectly, from

any organization or individual that is

doing or is seeking to do business with

the Company or is a competitor of the

Company. Any gift of significant value

(cost more than $50) must be returned

promptly to the donor with an

appropriate explanation.

The policy also applies to close relatives

of Associates. Should any supplier

contact you and suggest or offer any

payment, gift or anything of value

(cost more than $50) to you or any

Associate, discontinue the conversation

and contact the Legal Department at

SSG immediately.

If the gift is offered in conjunction with a

business-related function, activity or

holiday, you should do one of two

things. You should either decline, as set

forth above, or you may seek and

obtain the approval of the gift or activity

from the Senior Vice President of your

functional area or the Chief Operating

Officer or Chief Executive Officer,

as appropriate.

7. Entertainment

An Associate should not accept any

entertainment from any organization or

individual that is doing or seeking to do

business with the Company or is a

competitor of the Company if the

acceptance of the entertainment may

in any way influence the Associate not

to act solely in the best interests of

the Company.

8. Corporate Opportunities

An Associate should not appropriate to

him or herself or divert to others,

directly or indirectly, any business

opportunity that may be of interest to

the Company without first obtaining

written authorization from the

Chairman of the Board or his or her

designee after full disclosure of the

material facts. The fact that a particular

business opportunity is closely related to

an existing line of business of PetSmart,

or represents a desirable avenue of

expansion of PetSmart’s activities, is a

strong indication the Company would

be interested in the opportunity.

An Associate should not, directly or

indirectly, acquire, influence or assist

others in acquiring any real estate in

areas in which the Company may or

does have interests or development

BUSINESS POLICY STATEMENTS

activities. There are two exceptions to

this restriction. An Associate may

receive real property interests acquired

through inheritance, or through the

purchase of stocks listed on a national

security exchange or over the counter.

An Associate should not, directly or

indirectly, acquire, influence or assist

others in acquiring stock or a

participating interest in any enterprise

PetSmart is or may be taking steps to

acquire. This also applies to real

property interests owned, controlled

or in the vicinity of property owned

or controlled by PetSmart.

9. Speculation

An Associate should not deal in or

speculate in commodities, products,

materials, equipment or property

purchased or sold by the Company

10. Confidential Information

An Associate should not use or disclose

confidential Company information for

his or her personal profit or for the

advantage of anyone else. Each Associate

will be required to sign and abide by a

Confidentiality Agreement on accepting

employment with PetSmart.

Unless it is a legal requirement, or is

specifically authorized by a senior officer

of the Company, an Associate should

not disclose or release to anyone, or in

any forum, any decisions, plans,

competitive bids or any other

information concerning PetSmart, that

includes, but is not limited to, advertising

or marketing drawings, pictures, plans

or proposals, sales goals or plans,

information regarding employees and

any Company financial information.

Associates should secure PetSmart

information when it is in his or her

possession to ensure no accidental

disclosure or theft of such information.

11. Trading Securities on Inside

Information

If, at any time, an Associate has material

inside information about the Company (or

any other Company, particularly another

Company with which PetSmart does

business), he or she must refrain from

trading the Company’s securities until the

information has been disseminated to the

general public and absorbed by the

marketplace. This prohibition includes

indirect as well as direct transactions, puts,

calls or any other interest in the securities.

Material information means information

that a reasonable investor might consider

important in deciding whether to hold,

buy or sell the securities involved. Insider

trading carries potential criminal and civil

penalties.

BUSINESS POLICY STATEMENTS

In particular cases, it may be difficult to

determine whether information is

material. Any questions regarding the

possession of material information

should be asked prior to any purchase

or sale and should be brought to the

attention of the General Counsel of

PetSmart at Store Support Group in

Phoenix. Under no circumstances may

an Associate give material inside

information to any other person, either

specifically or in the form of a general

“tip.” The potential for tipping or an

unintentional disclosure of material inside

information, given the nature of

electronic chat rooms, internet

discussion boards, blogs or any similar

media for the distribution of opinions

and information, is significant in those

environments. As a result, all Associates,

including all directors and officers are

prohibited from using such media to

communicate about PetSmart or any

companies with which we do business,

other than for legally protected activities.

Policy to Conduct

Business Legally and

Ethically and to

Maintain Accurate

and Meaningful

Financial Records

It is the policy of PetSmart to conduct its

business both ethically and legally and to

present its financial information,

internally and externally, in a manner

that will not mislead or misinform those

who receive and use it. This policy

explains improper use of corporate

funds to gain favorable treatment by

regulatory authorities and describes the

requirements for maintaining and

reporting financial information.

In accordance with this policy, but

without limiting its generality, the

following rules are to be applied:

1. The use of Company funds or assets

for any unlawful or unethical purpose

is prohibited. For example, corporate

assets may not be used to influence

or obtain favorable treatment from

governmental or regulatory

authorities if doing so would violate

U.S. laws or the laws of any other

governing jurisdiction.

BUSINESS POLICY STATEMENTS

2. The establishment of any undisclosed

or unrecorded fund or asset

is prohibited.

3. The making of any false or

misleading entry on the Company’s

books or records is prohibited.

4. The making of any payment or other

disbursement to any third party for

any purpose other than as stated on

the voucher is prohibited.

5. The written or oral distribution of

any false or misleading financial

information or report, whether

internal or external, is prohibited.

6. Inappropriate use of labor dollars

or inaccurate reporting of labor

hours used or labor hours needed

is prohibited.

All corporate books, records and

accounts are to be kept in reasonable

detail. They must accurately and fairly

reflect corporate transactions and the use

of corporate assets in a manner that will

assist in the preparation of complete and

accurate financial reports. Each Associate

of the Company, including those without

financial reporting or accounting

responsibilities, is required to understand

and comply with this policy as it relates to

his or her individual job duties.

Occupational Health

and Safety Policy

It is the policy of PetSmart to establish

and maintain a safe and healthy work

environment. This policy covers the

responsibility of management and

Associates to minimize the hazards

inherent in the workplace by using

appropriate processes, practices and

methods, and by providing timely

education and training.

At PetSmart, the Company believes all

injuries and occupational illnesses can be

prevented, and safety is a fundamental

responsibility of each Associate of the

Company. The Company also believes

safety and occupational health must be

integrated with our effort to sell high

quality products at competitive prices

and provide excellent customer service.

Therefore, for the well-being of all

Associates and as a matter of policy:

1. Management will promote safety on

and off the job; implement accident

prevention programs, systems and

techniques; and provide a work

environment in which identified

occupational health and safety

hazards are controlled when

elimination is not feasible.

BUSINESS POLICY STATEMENTS

2. Store or Facility Managers will be

responsible and accountable for

implementing a superior level of

safety performance; instituting work

practices which reflect safe and

efficient methods for accomplishing

the required tasks; correcting all

deficiencies promptly; and escalating

safety issues to the appropriate

parties for correction or modification.

3. All Associates will be expected to

perform their jobs in the safest

manner prescribed; conduct

themselves in a way that enhances

their personal safety and that of their

fellow workers and customers;

report workplace hazards and make

suggestions for their correction; and

cooperate and contribute toward the

overall success of the program.

These worthwhile objectives can only

be achieved with the commitment and

complete support of every Associate.

Environmental Policy

It is the policy of PetSmart to comply

with the environmental, health and

safety laws in the conduct of its business

and to exemplify the best contemporary

industry practices with respect to

environmental matters. The policy

reviews the Company’s commitment

to continuous improvement of our

environmental protection practices

and to manage environmental

performance through cooperation

and active participation.

In all locations where PetSmart does

business, there are laws and regulations

designed to protect the environment.

Some of the products sold or used by

PetSmart may be subject to these

environmental laws.

PetSmart is committed to operating its

business in an environmentally

responsible manner. Where possible,

use of regulated materials will be

minimized or avoided. Where regulated

materials are used, PetSmart will use

them in accordance with applicable

laws. PetSmart will cooperate fully with

regulatory or governmental authorities

on these matters.

Computer Usage

All Associates are required to become

familiar with and abide by the Computer

Usage Policy found on Fetch. Users are

also expected to use their common

sense and exercise good judgment

while using all Computer services,

including email, internet, LAN and

network drives (e.g., G:\, W:\, X:\),

software and hardware and printers.

BUSINESS POLICY STATEMENTS

The policy is designed to protect

Company assets and ensure Company

information is not inappropriately

accessed. Associates should report

information security violations

immediately to their supervisor.

Some specific activities that are strictly

prohibited under the Computer Usage

Policy include, but are not limited to:

• Accessing confidential information that

is not within the scope of one’s work.

• Misusing, disclosing without proper

authorization, or altering Company

or personnel information.

• Any unauthorized, deliberate action

that damages or disrupts computing

systems or networks, alters their

normal performance, or causes them

to malfunction regardless of location

or duration.

• Willful or negligent introduction of

computer viruses or other destructive

programs into Company systems or

networks or into external systems

and networks.

• Unauthorized decryption or attempt

at decryption of any system or user

passwords or any other user’s

encrypted files.

• Gaining unauthorized access to a

computing system or network.

• Use, transmission, duplication or

voluntary receipt of material that

infringes on the copyrights,

trademarks, trade secrets or patent

rights of any person or organization.

• Unauthorized downloading of any

programs or files for use without

authorization in advance from the IT

Department and the user’s manager.

• Any conduct that would constitute or

encourage a criminal offense, lead to

civil liability, or otherwise violate any

regulations, local, state, national or

international law including, without

limitation. U.S. export control laws

and regulations.

• Deliberate pointing or hyper-linking of

the Company Web sites to other

Internet/www sites whose content

may be inconsistent with or in

violation with the aims or policies of

the Company.

COMPLIANCE PROGRAM ADMINISTRATION AND INFORMATION

• Transmission of any proprietary,

confidential or otherwise sensitive

information without the proper

authorization from a Company vice

president or above.

• Acquisition, storage, dissemination,

creation, posting, transmission or

voluntary receipt of any unlawful,

offensive, libelous, threatening or

harassing material including, but not

limited to, comments based on

race, national origin, sex, sexual

orientation, age, disability, religion

or political beliefs.

• Forwarding of chain letters.

• Participation in on-line contests,

forms of gambling or accepting of

promotional gifts.

• Engaging in activities that waste or

monopolize computer and/or

network reports to the exclusion

of others.

• Conduct of a business enterprise,

political activity, engaging in any form

of intelligence collection from clients

or business partners, engaging in

fraudulent activities or knowingly

disseminating false or otherwise

libelous materials.

Political Contributions

and Public Service Policy

PetSmart does not directly or indirectly

make contributions or other payments

or provide property or services to any

candidates for public office or to political

parties. Any Associate who makes a

political contribution personally should

ensure that he or she does not imply

that it is a contribution from the

Company. PetSmart encourages its

Associates to be actively involved in the

civic affairs of the communities in which

they live. When speaking on public

issues, however, Associates should do

so only as individual citizens of the

community, and must be careful not to

create the impression they are acting on

behalf of or representing the views of

PetSmart. The only exception to this is

Associates who have appropriate

authorization to speak on behalf of

the Company.

COMPLIANCE PROGRAM ADMINISTRATION AND INFORMATION

• Each officer of the Company is

responsible for Company-wide

understanding and adherence to these

policies. The officer of the Company

with ultimate responsibility to ensure

compliance and enforce these policies

is the General Counsel. Any Associate

who requires clarification regarding a

policy described in this book, or

desires to report a violation of the

Code, should follow the procedures

set forth in this policy for reporting or

may contact the General Counsel at

Store Support Group in Phoenix at

1-800-738-1385. The toll-free

number for questions, or to report a

potential violation is the CareSmart

Line at 1-800-738-4693.

• Periodically, reports will be provided

to the Chairman and to the Audit

Committee of the Board of Directors

regarding Company-wide adherence

to the Code of Business Ethics.

• An essential element of this Code is

the responsibility and obligation you

have as an Associate to appropriately

raise issues of concern to appropriate

individuals in the Company. Issues of

concern may include a violation of this

Code or any other Company policy,

pet safety concerns, harassment,

discrimination or issues surrounding

our financial records. The Company

has an open door policy, which

encourages Associates to raise issues

to an appropriate supervisor who will

address the issue.

Compliance Program

Administration and

Information

Each of the policies in this guide and all other supplemental statements made by the

Company will be implemented in accordance with the following:

• Additionally, an Associate can

anonymously report an issue of

concern through the CareSmart Line,

which is a call center operated by a

third-party entity. Our Legal

Department and Chief Compliance

Officer can be contacted directly at

1-800-738-1385 to discuss any issue

of concern. Any issue reported will be

taken seriously and appropriately

addressed. Supervisors/Managers in

receipt of an issue of concern must take

appropriate action to address such

issue. When applicable, the issue

should be elevated to other appropriate

individuals to address.

• In summary, it is imperative to report

violations of Company policy to an

appropriate individual. Failure to do

so or failure to take appropriate action

when in receipt of an issue of

concern, is a violation of the Code.

• Finally, every Associate has access to

the PetSmart Audit Department at

Store Support Group, and the Vice

President of Internal Audit periodically

reports to the Audit Committee of

the Board of Directors on issues

covered by the Code

COMPLIANCE PROGRAM ADMINISTRATION AND INFORMATION

Code of Ethics & Business

Conduct Associate

Certification Process

After reviewing this information in print

or online, you must complete a

Certification Form located on Fetch. If

you are reading this online, click this link

Ethics Certification and you will be

immediately directed to the form. If you

are unable to link to the certification

form at this time, it can also be found

on Fetch by searching “Code of Ethics”.

Completion of this certification is

mandatory. If you need help accessing

Fetch or need to complete the

certification in a written format, please

see your manager.

CODE OF ETHICS & BUSINESS CONDUCT ASSOCIATE CERTIFICATION

19601 NORTH 27

AVENUE

PHOENIX, ARIZONA 85027

623.580.6100