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EXHIBIT 11.1 CLAXSON INTERACTIVE GROUP INC.
(the Company) CODE OF BUSINESS CONDUCT AND ETHICS Introduction This Code of Business Conduct and Ethics covers a wide range of business
practices and procedures. It does not cover every issue that may arise, but it
sets out basic principles to guide all employees and directors of the Company
and its subsidiaries. These principles are designed to deter wrongdoing and to
promote (i) honest and ethical conduct, including ethical handling of actual or
apparent conflicts of interest between personal and professional relationships,
(ii) full, fair, accurate, timely and understandable disclosure in reports and
documents that the Company files publicly, (iii) compliance with applicable
governmental laws, rules and regulations, (iv) the prompt internal reporting of
violations of this Code to the appropriate person, and (vi) accountability for
adherence to this Code. All Company employees and directors must conduct
themselves accordingly and seek to avoid even the appearance of improper
behavior. In appropriate circumstances, the Code should also be provided to
and followed by the Companys agents and representatives, including
consultants. If a law conflicts with a policy in this Code, the employee or director
must comply with the law; however, if a local custom or policy conflicts with
this Code, the individual must comply with the Code. If an employee or
director has any questions about these conflicts, the individual should ask his
or her supervisor or other appropriate person how to handle the situation. Any employee who violates the standards in this Code will be subject to
disciplinary action. If an employee is in a situation that the employee
believes may violate or lead to a violation of this Code, the employee should
follow the guidelines described in Section 14 of this Code. Compliance with Laws, Rules, and Regulations Obeying the law, both in letter and in spirit, is the foundation on which
this Companys ethical standards are built. All employees and directors must
respect and obey the laws of the cities, states, and countries in which the
Company operates. Although not everyone is expected to know the details of
these laws, it is important to know enough to determine when to seek advice
from supervisors, managers, or other appropriate personnel. The Company holds information and training sessions to promote compliance
with laws, rules, and regulations, including insider-trading laws. Conflicts of Interest A conflict of interest exists when an individuals private interest
interferes in any way  or even appears to conflict  with the interests of the
Company as a whole. A conflict situation can arise when an employee or
director takes actions or has interests that may make it difficult to perform
his or her work on behalf of the Company in an objective and effective manner.
Conflicts of interest may also arise when an employee or director, or a member
of his or her family, receives improper personal benefits as a result of his or
her position in the Company. Loans to, or guarantees of obligations of,
employees, directors and their family members may create conflicts of interest. It is almost always a conflict of interest for a Company employee to work
simultaneously for a competitor, customer, or supplier. An employee is not
allowed to work for a competitor as a consultant or board member. The best
policy is to avoid any direct or indirect business connection with the
Companys customers, suppliers, or competitors, except on the Companys behalf.




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Conflicts of interest are prohibited as a matter of Company policy, except
under guidelines approved by the Board of Directors. Conflicts of interest may
not always be clear-cut, so if a question arises, the individual should consult
with higher levels of management or the Companys General Counsel. Any
employee or director who becomes aware of a conflict or potential conflict
should bring it to the attention of a supervisor, manager, or other appropriate
personnel, or consult the procedures described in Section 14 of this Code. Insider Trading Employees and directors 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. All
non-public information about the Company should be considered confidential
information. To use non-public information for personal financial benefit or
to tip others who might make an investment decision on the basis of this
information is not only unethical but also illegal. If a question arises, the
individual should consult the Companys General Counsel. For further
information please refer to the Insider Trading Policy adopted by the Company
which can be accessed through the Companys network public drive or be
requested to the legal department. Corporate Opportunities Employees and directors are prohibited from taking for themselves
personally opportunities that are discovered through the use of corporate
property, information, or position without the consent of the Board of
Directors. No employee or director may use corporate property, information, or
position for improper personal gain, and no employee or director may compete
with the Company directly or indirectly. Employees and directors owe a duty to
the Company to advance its legitimate interests when the opportunity to do so
arises. Competition and Fair Dealing The Company seeks to outperform competitors fairly and honestly. The
Company seeks competitive advantages through superior performance, never
through unethical or illegal business practices. Stealing proprietary
information, possessing trade secret information that was obtained without the
owners consent, or inducing such disclosures by past or present employees of
other companies, is prohibited. Each employee and director should endeavor to
respect the rights of and deal fairly with the Companys customers, suppliers,
competitors, and employees. No employee or director should take unfair
advantage of anyone through manipulation, concealment, or abuse of privileged
information, misrepresentation of material facts, or any other intentional
unfair-dealing practice. To maintain the Companys valuable reputation, compliance with the
Companys quality processes and safety requirements is essential. In the
context of ethics, quality requires that the Companys products and services
meet reasonable customer expectations. All inspection and testing documents
must be handled in accordance with all applicable regulations. The purpose of business entertainment and gifts in a commercial setting is
to create good will and sound working relationships, not to gain unfair
advantage with customers. No gift or entertainment should ever be offered,
given, provided, or accepted by any Company employee, family member of an
employee, or agent unless it (1) is not a cash gift, (2) is consistent with
customary business practices, (3) is not excessive in value, (4) cannot be
construed as a bribe or payoff, and (5) does not violate any laws or
regulations. An employee should discuss with his or her supervisor any gifts
or proposed gifts that the employee is not certain are appropriate. Discrimination and Harassment The diversity of the Companys employees is a tremendous asset. The
Company is firmly committed to providing equal opportunity in all aspects of
employment and will not tolerate any illegal discrimination or harassment of
any kind. Examples include derogatory comments based on racial or ethnic
characteristics and unwelcome sexual advances. 2




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Health and Safety The Company strives to provide each employee with a safe and healthful
work environment. Each employee has responsibility for maintaining a safe and
healthy workplace for all employees by following safety and health rules and
practices and reporting accidents, injuries, and unsafe equipment, practices,
or conditions. Violence and threatening behavior are not permitted. Employees should
report to work in condition to perform their duties, free from the influence of
illegal drugs or alcohol. The use of illegal drugs in the workplace will not
be tolerated. Record-Keeping The Company requires honest and accurate recording and reporting of
information in order to make responsible business decisions. For example, only
the true and actual number of hours worked should be reported. Many employees regularly use business expense accounts, which must be
documented and recorded accurately. If an employee is not sure whether a
certain expense is legitimate, the employee should ask his or her supervisor or
the Companys controller. Rules and guidelines are available from the
Accounting Department. All of the Companys books, records, accounts, and financial statements
must be maintained in reasonable detail, must appropriately reflect the
Companys transactions, and must conform both to applicable legal requirements
and to the Companys system of internal controls. Unrecorded or off the
books funds or assets should not be maintained unless permitted by applicable
law or regulation. Business records and communications often become public, and the Company
and its employees should avoid exaggeration, derogatory remarks, guesswork, or
inappropriate characterizations of people and companies that can be
misunderstood. This applies equally to e-mail, internal memos, and formal
reports. Records should always be retained or destroyed according to the
Companys record retention policies. In accordance with those policies, in the
event of litigation or governmental investigation, employees must consult with
the Companys General Counsel before taking any action because it is critical
that any impropriety or possible appearance of impropriety be avoided. Confidentiality Employees and directors must maintain the confidentiality of confidential
information entrusted to them by the Company or its customers, except when
disclosure is authorized by an executive officer or required or mandated by
laws or regulations. Confidential information includes all non-public
information that might be of use to competitors or harmful to the Company or
its customers, if disclosed. It also includes information that suppliers and
customers have entrusted to us. The obligation to preserve confidential
information continues even after employment ends. Protection and Proper Use of Company Assets All employees and directors should endeavor to protect the Companys
assets and ensure their efficient use. Theft, carelessness, and waste have a
direct impact on the Companys profitability. Any suspected incident of fraud
or theft should be immediately reported for investigation. Company assets
should be used for legitimate business purposes and should not be used for
non-Company business, though incidental personal use may be permitted. The obligation of employees to protect the Companys assets includes its
proprietary information. Proprietary information includes intellectual
property, such as trade secrets, patents, trademarks, and copyrights, as well
as business, marketing and service plans, engineering and manufacturing ideas,
designs, databases, records, salary information, and any unpublished financial
data and reports. Unauthorized use or distribution of this information would
violate Company policy. It could also be illegal and result in civil or even
criminal penalties. 3




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Payments to Government Personnel The U.S. Foreign Corrupt Practices Act prohibits giving anything of value,
directly or indirectly, to officials of foreign governments or foreign
political candidates in order to obtain or retain business. It is strictly
prohibited to make illegal payments to government officials of any country.
For further information please refer to the Foreign Corrupt Practices Act
Policy adopted by the Company which can be accessed through the Companys
network public drive or be requested to the legal department. In addition, the U.S. government has a number of laws and regulations
regarding business gratuities that may be accepted by U.S. government
personnel. The promise, offer, or delivery to an official or employee of the
U.S. government of a gift, favor, or other gratuity in violation of these rules
would not only violate Company policy but could also be a criminal offense.
State and local governments, as well as foreign governments, may have similar
rules. Waivers of the Code of Business Conduct and Ethics Any waiver of this Code for executive officers or directors may be made
only by the Board or a Board committee and will be promptly disclosed to
stockholders as required by law or stock exchange regulation. Reporting any Illegal or Unethical Behavior Employees are encouraged to talk to supervisors, managers, or other
appropriate personnel when in doubt about the best course of action in a
particular situation. Employees should report any observed illegal or
unethical behavior and any perceived violations of laws, rules, regulations, or
this Code to appropriate personnel. It is the policy of the Company not to
allow retaliation for reports of misconduct by others made in good faith by
employees. Employees are expected to cooperate in internal investigations of
misconduct. Compliance Procedures We must all work to ensure prompt and consistent action against violations
of this Code. However, in some situations it is difficult to know right from
wrong. Since we cannot anticipate every situation that will arise, it is
important that we have a way to approach a new question or problem. These are
the steps to keep in mind:  
    
    Make sure you have all the facts. In order to reach the
right solutions, we must be as fully informed as possible.  
    
    Ask yourself: What specifically am I being asked to do? Does
it seem unethical or improper? This will enable you to focus on the
specific question you are faced with and the alternatives you have.
Use your judgment and common sense; if something seems unethical or
improper, it probably is.  
    
    Clarify your responsibility and role. In most situations,
there is shared responsibility. Are your colleagues informed? It
may help to get others involved and discuss the problem.  
    
    Discuss the problem with your supervisor. This is the basic
guidance for all situations. In many cases, your supervisor will be
more knowledgeable about the question and will appreciate being
brought into the decision-making process. Remember that it is your
supervisors responsibility to help solve problems.  
    
    Seek help from Company resources. In the rare case where it
may not be appropriate to discuss an issue with your supervisor, or
where you do not feel comfortable approaching your supervisor with
your question, discuss it locally with your office manager or your
Human Resources manager. If you prefer to write, address your
concerns to the Companys General Counsel.  
    
    You may report ethical violations in confidence and without
fear of retaliation. If your situation requires that your identity
be kept secret, your anonymity will be protected. The
Company does not permit retaliation of any kind against employees for
good faith reports of ethical violations. 4




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
    
    Always ask first, act later: If you are unsure of what to do
in any situation, seek guidance before you act. Additional Policies for the Chief Executive Officer and Senior Financial Officers The Companys Chief Executive Officer and all senior financial officers,
including the Chief Financial Officer and principal accounting officer, are
bound by the provisions of this Code set forth above. The Chief Executive
Officer and senior financial officers are also subject to the following
additional specific policies:  
    
    The Chief Executive Officer and all senior financial officers
are responsible for full, fair, accurate, timely and understandable
disclosure in the periodic reports required to be filed by the
Company with the SEC. Accordingly, it is the responsibility of the
Chief Executive Officer and each senior financial officer promptly
to bring to the attention of the Board of Directors any material
information of which he or she may become aware that affects the
disclosures made by the Company in its public filings.  
    
    The Chief Executive Officer and each senior financial officer
shall promptly bring to the attention of the Audit Committee any
information he or she may have concerning (a) significant
deficiencies in the design or operation of internal controls which
could adversely affect the Companys ability to record, process,
summarize and report financial data or (b) any fraud, whether or not
material, that involves management or other employees who have a
significant role in the Companys financial reporting, disclosures
or internal controls.  
    
    The Chief Executive Officer and each senior financial officer
shall promptly bring to the attention of the General Counsel or the
Chief Executive Officer and to the Audit Committee any information
he or she may have concerning any violation of this Code, including
any actual or apparent conflicts of interest between personal and
professional relationships, involving any management or other
employees who have a significant role in the Companys financial
reporting, disclosures or internal controls.  
    
    The Chief Executive Officer and each senior financial officer
shall promptly bring to the attention of the General Counsel or the
Chief Executive Officer and to the Audit Committee any information
he or she may have concerning evidence of a material violation of
the securities or other laws, rules or regulations applicable to the
Company and the operation of its business, by the Company or any
agent thereof, or any violation of this Code. Violations The Board of Directors shall determine, or designate appropriate persons
to determine, appropriate actions to be taken in the event of violations of
this Code. Such actions shall be reasonably designed to deter wrongdoing and to
promote accountability for adherence to this Code, and shall include written
notices to the individual involved that the Board has determined that there has
been a violation, censure by the Board, demotion or re-assignment of the
individual involved, suspension with or without pay or benefits (as determined
by the Board) and termination of the individuals employment. In determining
what action is appropriate in a particular case, the Board of Directors or such
designee shall take into account all relevant information, including the nature
and severity of the violation, whether the violation was a single occurrence or
repeated occurrences, whether the violation appears to have been intentional or
inadvertent, whether the individual in question had been advised prior to the
violation as to the proper course of action and whether or not the individual
in question had committed other violations in the past. 5