POLICY REGARDING EXCESSIVE OR LUXURY EXPENDITURES
General Policy. The employees and directors of Community Holding Company of Florida, Inc. and Community Bank, Destin and its affiliates (collectively, the “Company”) are prohibited from making any excessive or luxury expenditures in violation of this policy. The term “excessive or luxury expenditures” means excessive expenditures on any of the following to the extent such expenditures are not reasonable expenditures for staff development, reasonable performance incentives, or other similar reasonable measures conducted in the normal course of the Company’s business operations:
- entertainment or events;
- office or facility renovations;
- aviation or other transportation services; and
- other similar items, activities, or events for which the Company may reasonably anticipate incurring expenses, or reimbursing an employee or director for incurring expenses.
Reasonable expenditures may be incurred for business-related activities, events and purposes related to business development, marketing, staff and professional development, including, without limitation, legitimate travel and meeting-related costs for attendance at conferences and meetings in appropriate environments for purposes of business and professional development, education, training, familiarization with Company products and services, and/or networking and best practice sharing across companies and industries; provided, however, such expenditures must conform with all applicable Company policies and procedures.
Air Travel. Air travel on Company business shall be by commercial airline or as a passenger on a third party-owned or leased aircraft paid for by the third party. Air travel by first or business class requires the prior approval of the Chief Executive Officer. The Company does not own or lease any private aircraft for use by Company employees or directors. If the company deems it to be cost effective for the purposes of any particular event to charter the use of a small private aircraft, it may do so with the consent of the chief executive officer.
Automobile Expenses. The Company may provide automobiles of an appropriate make, model and age – but not luxury automobiles (defined as costing more than $50,000 new) – for use by the Chief Executive Officer, President, or Chief Deposit Officer. No other car will be provided for use by any Company employee or director (except as specifically required for the employee’s job, such as in the case of a delivery person) except with the prior approval of the Board of Directors.
Entertainment Expenses. All expenditures by employees or directors for entertainment must comply with applicable Company policies and must have a business purpose. Requests for reimbursement for such expenditures must be justified and supported by documentation in accordance with applicable Company policies and procedures.
Employee Offices. Employees’ offices, including executive offices, shall be appropriate for the employee’s position but not ostentatious in size, furnishings or decoration. Materials used to construct or renovate offices and facilities shall be selected on the basis of their quality, appearance, cost and durability, considering their intended use and avoiding opulence. All expenditures for constructing, renovating, or furnishing offices must comply with applicable Company policies and procedures, which require Chief Executive Officer and/or Board of Directors approval, depending on the type and amount of the expenditure.
Expenditures for Activities and Events. The Chief Executive Officer’s prior approval is required for expenditures for an activity or event whose total cost exceeds $5,000. If the cost exceeds $25,000, prior approval of the Board of Directors is required unless previously approved in the budget.
Documentation. All Company expenditures, including those expenditures covered by this policy, shall be documented, reported, supported by written invoices and receipts, and subject to audit in accordance with standard, uniformly-applied Company policies and procedures.
Reporting Violations; Disciplinary Action. An employee or director who learns of a violation of this policy shall promptly report the violation to Chief Executive Officer and the Bank’s Audit Committee. Compliance with this policy is a condition of employment, and any violations thereof may result in disciplinary action.
Certification of Compliance. The Chief Executive Officer and the Chief Financial Officer shall certify at least annually that this policy is being followed and that the approval of any expenditure requiring prior approval of an executive officer or the Company’s Board of Directors was properly obtained with respect to each such expenditure.