Athens Federal Community Bank is a wholly owned subsidiary of Athens Bancshares Corporation, and is traded on the OTCQX best marketplace under the symbol AFCB. For more information, visit http://www.otcmarkets.com/stock/AFCB/news.
ATHENS BANCSHARES CORPORATION
Code of Ethics and Business Conduct
This Code of Ethics and Business Conduct represents an overview of the corporate policies that should govern the actions of all employees, officers and directors of Athens Bancshares Corporation and its subsidiaries. It is not a replacement for policies and procedures that address the specifics of our business or which may impose stricter or more detailed requirements. No code of conduct can cover every potential situation. The Code is designed to provide written standards to promote honest and ethical conduct, compliance with law, and a vehicle for prompt internal reporting and accountability to assure adherence to the Code. It is, therefore, your responsibility to apply the principles set forth in this Code in a responsible fashion and with the exercise of good business judgment.
Certain parts of this Code may apply specifically to “executive officers.” Executive officer means a member of the Company’s or its subsidiaries’ management so designated by resolution of the Board of Directors.
The policies and procedures contained in this Code do not constitute a legal contract and may be changed, modified or discontinued from time to time without notice (except as required by law) and in the sole discretion of Athens Bancshares Corporation. Failure to adhere to these policies and procedures may result in disciplinary action up to and including dismissal.
Except as otherwise provided by written agreement or applicable law, persons employed by the Company or its subsidiaries are employed at will, and the Company reserves the right to take employment action, including termination, at any time for any reason without notice.
NOTE: Throughout the Code of Ethics and Business Conduct, the term “Company” refers to Athens Bancshares Corporation and/or the subsidiary in which an employee works, depending on context.
Use of Company Assets
he Company’s assets are to be used exclusively in the pursuit of the Company’s business except for minimal personal use authorized by your supervisor in accordance with other Company policies. The Company’s assets include equipment, facilities, supplies, services such as telephones and computer networks, and the time and efforts of its employees. You should not use Company assets for personal gain or convenience, or make Company assets available for the gain or convenience of anyone else, or for any purpose other than conducting the Company’s business unless you have management authorization to do so.
Authority to Make Commitments
Only specific employees are authorized to make financial or other commitments on behalf of the Company. Commitments might be such things as approving a loan or other extension of credit, ordering equipment or materials, authorizing business travel, approving payment of an invoice or expense report, authorizing budgets or budget overruns, signing leases or other contracts, selling Company assets, settling litigation or other claims, borrowing money, setting compensation or employee benefits, making charitable contributions and other transactions. These authorizations are in writing and are governed by corporate policies. You should not make a Company commitment unless you have the authority to do so.
Bribes and Other Illegal Corporate Payments
The use of Company funds for payments to any individual, company or organization for the purpose of obtaining favorable treatment in securing business or other special considerations is prohibited. This policy does not prohibit normal and customary business expenses such as reasonable entertainment, trade organization dues or similar expenses that are allowed by applicable Company policies, which must be properly reported on an appropriate expense report form.
Relations with Government Employees
The U.S. government has various regulations prohibiting government personnel from accepting entertainment, gifts, gratuities or other business courtesies that may be acceptable in the private commercial sector. All Company employees who may have to make these sorts of judgments must understand and comply with the letter and intent of such regulations.
Integrity of Records and Reports
The Company’s accounting records are relied upon to produce reports to the Company’s management, shareholders, government agencies and others. All Company accounting records and reports produced from those records shall be kept and presented in a timely fashion and in accordance with the laws of each applicable jurisdiction. Such records and reports must accurately and fairly reflect in reasonable detail the Company’s assets, liabilities, revenues and expenses.
Responsibility for accurate and complete financial records does not rest solely with the Company’s accounting employees. All employees involved in approving transactions, supplying supporting information for transactions and determining account classifications have responsibility for complying with our policies.
Reports to Management
The same high standards required in the Company’s external reporting apply to financial reports to management. Accruals and estimates included in internal reports (such as business plans, budgets and forecasts) shall be supported by appropriate documentation and based on good-faith judgment.
Payments and Disbursements
All payments made by or on behalf of the Company must be documented in the accounting records with appropriate approval(s) and an adequate description of the business purpose of the disbursement.
Cash Deposits and Bank Accounts
All cash received by the Company shall be promptly recorded in the accounting records and deposited in a bank account properly authorized by the Company. All bank accounts and other cash accounts shall be clearly and accurately recorded in the accounting records. No unrecorded accounts, funds or assets shall be established for any purpose.
Cooperation with Inquiries
Employees shall provide complete and accurate information in response to inquiries from the Company’s internal and outside independent auditors as well as the Company’s legal counsel.
Political Contributions and Activities
No Company funds or assets, including the work time of any employee, may be contributed, loaned or made available, directly or indirectly, to any political party or to the campaign of any candidate for a local, state or federal office.
Conflicts of Interest
You must carry out your professional responsibilities with integrity and with a sense of loyalty to the Company. You must avoid any situation that involves a possible conflict or an appearance of a conflict of interest between your personal interests and the interests of the Company. Knowingly acting in a manner that presents a conflict between your personal interests and the best interests of the Company is a violation of this Code.
A conflict of interest cannot be defined precisely, only illustrated. The basic factor that exists in all conflict situations is a division of loyalty between the Company’s best interests and the personal interest of the individual. Many, but not all, conflict situations arise from personal loyalties or personal financial dealings. It is impossible to list every circumstance giving rise to a possible conflict of interest, but the following illustrates the types of situations that may cause conflicts.
A conflict of interest may exist when the Company does business with or competes with an organization in which a family member has an ownership or employment interest. “Family members” include a spouse, parents, children, siblings and in-laws. You may not conduct business on behalf of the Company with family members or an organization with which you or a family member is associated unless you receive prior written approval under this Code.
Ownership in Other Businesses
You cannot own, directly or indirectly, a significant financial interest in any business entity that does business with or is in competition with the Company unless you receive prior written approval under this Code. As a guide, “a significant financial interest” is defined as ownership by an employee and/or family members of more than 1% of the outstanding securities/capital value of a corporation or that represents more than 5% of the total assets of the employee and/or family members.
Employees must keep outside business activities, such as a second job or self-employment, completely separate from the employee’s activities with the Company. Employees may not use Company assets, facilities, materials, or services of other employees for outside activities unless specifically authorized by the Company, such as for certain volunteer work.
Disclosure Required - When in Doubt, Ask!
You should avoid any actual or apparent conflict of interest. Conflicts can arise unexpectedly and prompt disclosure is critically important. Employees must disclose existing or emerging conflicts of interest (including personal relationships that could reasonably be considered to create conflicts) to their manager and follow the guidance provided. Executive officers and directors must disclose existing or emerging conflicts of interest to the President and Chief Executive Officer.
Accepting Gifts & Gratuities
Accepting Things of Value
Except as provided below, you may not solicit or accept for yourself or for a third party anything of value from anyone in return for any business, service or confidential information of the Company. Things of value include gifts, meals, favors, services and entertainment. The purpose of this policy is to ensure that the Company’s business is safeguarded from undue influence of bribery and personal favors.
The solicitation of and acceptance of things of value is generally prohibited by the Bank Bribery Act. Violations may be punished by fines and imprisonment.
The following transactions are permitted and will be considered as exceptions to the general prohibition against accepting things of value:
Acceptance of gifts, gratuities, amenities or favors based on family or personal relationships when the circumstances make clear that it is those relationships, rather than the business of the Company, that are the motivating factors;
Acceptance of meals, refreshments, travel arrangements, accommodations or entertainment, all of a reasonable value, in the course of a meeting or other occasion, the purpose of which is to hold bona fide business discussions or to foster better business relations, provided that the expense would be paid for by the Company as a reasonable business expense if not paid for by another party;
Acceptance of advertising or promotional material of reasonable value, such as pens, pencils, note pads, key chains, calendars and similar items;
Acceptance of discounts or rebates on merchandise or services that do not exceed those available to other customers;
Acceptance of gifts of reasonable value related to commonly recognized events or occasions, such as a promotion, new job, wedding, retirement, birthday or holiday; or Acceptance of civic, charitable, education or religious organizational awards for recognition of service and accomplishment.
If you are offered or receive something of value beyond what is permitted in this Code, you must obtain prior approval before you may accept or keep it. Transactions other than those described above may be approved so long as approval is consistent with the Bank Bribery Act. If you are at all uncertain as to whether you may accept something of value, do not hesitate to ask.
Directors and officers of the Company stand in a fiduciary relationship to the Company. It is a breach of this duty for any such person to take advantage of a business opportunity for his or her own personal profit or benefit when the opportunity is within the corporate powers of the Company and when the opportunity is of present or potential practical advantage to the Company, unless the Board of Directors knowingly elects not to avail itself of such opportunity and the director’s or officer’s participation is approved in advance by the Board. It is the policy of the Company that no director or executive officer appropriate a corporate opportunity without the consent of the Board of Directors.
Equal Employment Opportunity, Harassment and Sexual Harassment
Equal Employment Opportunity
It is the policy of the Company to provide equal employment opportunity in full compliance with all federal, state and local equal employment opportunity laws and regulations.
The Company is committed to providing a work environment where all employees work free from harassment because of race, color, religion, age, gender, sexual orientation, national origin, disability or any characteristic protected by applicable law. The Company will not tolerate harassment by employees, supervisors, customers or others.
Our policy is essentially based on common sense: all employees should treat each other with respect and courtesy. Harassment in any form – including verbal and physical conduct, visual displays, threats, demands and retaliation – is prohibited.
What Constitutes Sexual Harassment
The Equal Employment Opportunity Commission has guidelines that define sexual harassment as unwelcome sexual advances, requests for sexual favors and other verbal or physical conduct of a sexual nature when:
Submission to such conduct is made either explicitly or implicitly a term or condition of an individual’s employment, or used as the basis for employment decisions affecting such individual; or Such conduct creates an intimidating, hostile or offensive working environment.
Sexual harassment can involve either a tangible employment action or a hostile work environment. Sexual harassment includes more than overt physical or verbal intimidation. Lewd or vulgar remarks, suggestive comments, posters, pictures and calendars, pressure for dates and sexual favors, and unacceptable physical contact are examples of what can constitute harassment.
It is important to realize that what may not be offensive to you may be offensive to others. You should consider carefully the effect of your words and actions on others, and should not assume that another employee’s failure to object means that the employee welcomes the behavior at issue.
The Company as a general matter does not seek to regulate the private social behavior of employees. However, intimate relationships between supervisors and employees whom they directly supervise are discouraged. Because of the undesirable workplace repercussions that they may have, any such ongoing relationship should be disclosed to the supervisor’s department head. All employees should understand that no one at the Company has the authority to offer job benefits or threaten job disadvantages based on the provision of sexual favors.
Sexual harassment also can occur among co-workers or result from behavior by contractors or other non-employees who have reason to interact with Company employees. Our policy extends to these circumstances as well.
Obligation to Report
Any employee who has reason to believe that he/she is being harassed must promptly report the harassment. The official procedure for reporting violations or suspected violations of this policy is located on page 13 of this Code under the Heading “How to Report a Violation.” Do not allow an inappropriate situation to continue by not reporting it, regardless of who is creating the situation.
As set forth in “Administration of the Code of Ethics and Business Conduct,” beginning on page 13, the Company will promptly investigate allegations of harassment and, to the extent possible, conduct such investigations confidentially. Any employee who is found to have violated this policy is subject to discipline or discharge.
The Company will not tolerate retaliation in any form against an employee who has, in good faith, reported an incident of harassment, and employees should not fear that such a report will endanger his/her job.
Illegal & Impairing Substances
You may not possess, use, sell, distribute or be under the influence of illegal drugs while on Company property or while conducting Company business anywhere. Such behavior is a violation of Company policy in addition to being a violation of the law.
When reporting for work and throughout the work day, you must be fit for duty at all times and, in particular, not pose a safety hazard to yourself or others through your use of alcohol or other legal, but impairing, substances.
The Company expressly prohibits any acts of violence or threats of violence by any Company employee against any other person in or about Company facilities or in connection with the conduct of Company business elsewhere at any time.
You are prohibited from possessing firearms while on Company property or while conducting Company business anywhere at any time unless authorized by the Company.
Marketing Practices and Antitrust
The Company’s products and services must be sold fairly and honestly. You should not attempt to take advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other unfair practice. Many of the products and services provided by the Company are subject to laws and regulations that specify the information that must be provided to the Company’s customers. It is the policy of the Company to comply fully with these disclosure requirements.
The antitrust laws are intended to foster free and open competition and it is important that the Company comply with the letter and the spirit of such laws. Agreements that reduce business competition are a core concern of the antitrust laws and violations may result in severe civil and criminal penalties to the Company and to individuals. Antitrust laws pertain to dealings with customers and suppliers as well as competitors.
In some cases, depending on the circumstances, the antitrust laws prohibit discussions among competitors about competitively sensitive subjects. The most serious antitrust violations are agreements among competitors that directly restrict competition among them.
These include agreements:
To raise, lower or stabilize prices;
To divide the areas in which they will do business or the customers they will serve; or
To refuse to deal with certain customers or suppliers.
Conduct intended to drive a competitor out of business may also violate antitrust laws. It is the policy of the Company to fully comply with all applicable antitrust laws.
Antitrust is a complex area of the law and violations have serious consequences for the Company and for individuals personally. The Company’s legal counsel should be consulted with any questions.
Computer Networks, Voice Mail, E-mail and the Internet
Many Company employees depend on access to computer networks, voice mail, e-mail and/or the Internet to do their jobs. These tools come with risks and responsibilities that all employees must understand and accept.
You must use these resources only for the business activities of the Company (except as described under “Authorized Uses” on page 9) and:
Properly identify yourself in electronic communication;
Use only your own password and user ID to gain access to systems or data;
Accept full personal responsibility for the activities undertaken with your password and user ID;
Delete e-mail, voice mail and other electronic files in accordance with applicable record retention policies; and
Comply with the computer security policies of the Company and conduct yourself in a manner that protects the Company from damage, theft, waste and violations of the law, including:
Protecting against exposure to potentially destructive elements, intentional (viruses, sabotage, etc.) or unintentional (bugs); and
Protecting against unauthorized access to Company information or resources (hacking).
Company Property and Privacy
Computer networks and electronic communications systems, and all messages and log files generated on or handled by them (including back-up copies), are considered to be the property of the Company.
There should be no expectation of privacy in these electronic interactions. The Company may monitor the content of your electronic communications or monitor the content of server log files to review what Web sites or other Internet locations you have visited and what files you may have sent or received. Computer networks, e-mail systems, voice mail systems and server logs are monitored regularly to support routine and non-routine activities such as operations, maintenance, auditing, security and investigations. You should also keep in mind that, as a matter of law, the Company may be called upon to turn over this information to law enforcement and private litigants.
You may not intercept or disclose, or assist in intercepting or disclosing, electronic communications or Internet activity except as specifically provided above and only then with appropriate authorization.
Company computer networks, e-mail and voice mail systems and Internet access generally must be used only for Company business activities. Incidental personal use is permitted if it:
Doesn’t preempt or interfere with any Company business activity or with employee productivity; and
Consumes only a trivial amount of Company resources.
Incidental personal use is subject to the same policies as business use.
Under no circumstances should Company computer networks, e-mail and voice mail systems or Internet access be used:
For any illegal activity;
To communicate offensive sexual, racial or other remarks, jokes, slurs and obscenities;
For private business, commercial or solicitation activities;
For chain-letter communications of any kind;
For charitable endeavors that are not Company-sponsored or authorized, including any fundraising;
For gambling; or
Additional uses may be prohibited or limited by other provisions of this Code or by other Company policies.
Many employees learn confidential Company information in the course of their jobs and use it to perform important functions. It is vitally important that all employees handle confidential information properly.
There are two major concerns:
Preventing the release of unauthorized or inappropriate information that might adversely affect the Company’s business; and
Avoiding violations of the law, particularly the securities laws relating to disclosure of material financial information before the information is made public.
What is Confidential Information?
What follows is not a complete list of what is considered to be confidential information, but it illustrates what is typically confidential unless it has been disclosed by the Company in a securities filing, press release, or other authorized formal or official public communication:
Financial results, budgets or forecasts;
Business plans, operating plans, strategy statements, memos, operating manuals, organization charts and other internal communications;
Company investments, acquisitions or divestitures;
New products, processes or designs;
Whether a product or business is meeting financial or other expectations;
Business relationships or the terms of any business arrangement, including prices paid or received by the Company;
Customer data such as customer names and addresses or any confidential personal or business information of the customer;
Advertising and marketing plans and campaigns;
Wages and salaries, bonus or compensation plans, notices to employees or unannounced personnel changes; and
Personal information about any employee.
In general, if information about the Company has not been made public by the Company, it should be treated as confidential.
Non-Disclosure and Non-Use
You may not disclose to unauthorized persons or use for your own personal advantage or profit, or the advantage or profit of another, any confidential information that you obtain as a result of your position with the Company.
This includes not only financial analysts and the press, but also business associates, family members and personal friends. It is a serious mistake to disclose such information to anyone simply because you are confident that that person will neither try to benefit from it nor disclose it to others.
Your obligations not to disclose the Company’s confidential information and not to use it for unauthorized purposes continue after your affiliation with the Company ends.
Privacy of Customer Information
You may be asked for information about the Company by the media, trade groups, consultants and others collecting information for various purposes. You should not make public statements on behalf of the Company or provide confidential information in response to external inquiries unless you have been authorized to do so.
Some employees must disclose confidential Company information as a part of their job responsibilities. This policy on confidential information is not intended to prohibit such authorized disclosures.
A few examples of situations in which confidential information might properly be disclosed are:
Disclosure of operational data to vendors or consultants in connection with providing services to the Company;
Participation in legitimate and authorized industry surveys;
Providing data to governmental agencies as part of required filings; or
An authorized employee responding to media or financial analyst inquiries.
You should be certain that you understand what you have been authorized to disclose, and to whom, prior to disclosing any confidential information
“Inside” Information and Insider Trading
You must not trade in the Company’s stock when you have material information about the Company that is not yet public. Material information is information that would reasonably be expected to either (1) affect the price of securities issued by the Company or (2) be important to an investor in deciding whether to buy, sell or hold securities issued by the Company. Furthermore, you must not communicate material non-public information to persons outside the Company so that they may profit from transactions in the Company’s securities.
Engaging in insider trading or providing confidential information that is used in insider trading is illegal and can result in substantial fines and criminal penalties to you.
The Company maintains a policy on insider trading that provides more complete guidance on this subject, including rules on trading in Company securities by executive officers, directors and employees who have access to certain financial information.
You should call the President and Chief Executive Officer with any questions about buying or selling of Company stock.
Examinations, Government Investigations and Litigation
The Company and its subsidiaries are subject to examination by federal banking regulators. It is Company policy to cooperate fully with the Company’s regulators.
It is Company policy to cooperate with reasonable and valid requests by federal, state or local government investigators. At the same time, the Company is entitled to all the safeguards provided in the law for persons under investigation, including representation by counsel.
Accordingly, if a government investigator requests an interview with you, seeks information or access to files, or poses written questions, he/she should be told that you must first consult with the Company’s legal counsel. You should immediately contact the President and Chief Executive Officer, who will then provide advice as to further action.
You should be aware that criminal sanctions could be imposed upon any person who submits false or misleading information to the government in connection with any regulatory examination or government investigation. Full cooperation and proper legal supervision of any response in connection with a regulatory examination or government investigation is essential from both corporate and individual viewpoints.
In the event any litigation is begun or threatened against the Company, notify the President and Chief Executive immediately, even if the action or threats appear to be without merit or insignificant.
Preservation of Records
All records relating to the business of the Company shall be retained as required by the Company’s record retention guidelines. Notwithstanding such guidelines, under no circumstances shall any records known to be the subject of or germane to any anticipated, threatened or pending lawsuit, governmental or regulatory investigation, or bankruptcy proceeding be removed, concealed or destroyed.
Detailed Policies and Procedures
This Code does not contain all of the policies of the Company or all of the details of the policies that are included. The Company has written policies and procedures that provide more information on some of the topics in this Code of Ethics and Business Conduct.
Talk to your supervisor about the Company’s policies and procedures that you are responsible for following in your job and make sure that you have reviewed and understand them.
Administration of the Code of Ethics and Business Conduct
Every Employee Has an Obligation to:
Comply with this Code of Ethics and Business Conduct, which prohibits violation of local, state, federal or foreign laws and regulations applicable to our businesses, and requires compliance with all Company policies;
Be familiar with laws and Company policies applicable to his/her job and communicate them effectively to subordinates;
Ask questions if a policy or the action to take in a specific situation is unclear;
Be alert to indications and/or evidence of possible wrongdoing; and
Report violations and suspected violations of this Code of Ethics and Business Conduct to the appropriate person as described in “How to Report a Violation” below and elsewhere in this Code.
The Company’s managers have a particular responsibility to notice and question incidents, circumstances and behaviors that point to a reasonable possibility that a violation of this Code has occurred. A manager’s failure to follow up on reasonable questions is, in itself, a violation of Company policy.
How to Ask a Question
Whenever possible, an employee should work with his/her immediate supervisor to get answers to routine questions.
If a supervisor’s answer does not resolve a question or if an employee has a question that he/she cannot comfortably address to his/her supervisor, he/she should go to the Human Resources Department.
Executive officers and directors may bring any questions to the Chairman of the Board or the Chairman of the Audit Committee.
How to Report a Violation
Any employee having information about a violation (or suspected violation) of this Code should report the violation in writing to the Human Resources Department.
Executive officers and directors may submit any reports of violations (or suspected violations) of this Code in writing to the President and Chief Executive Officer.
If the violation involves the President and Chief Executive Officer, then the employee should report the violation by informing the Chairman of the Audit Committee.
Concerns regarding questionable accounting or auditing matters should be handled under the procedures for confidential, anonymous submissions established by the Audit Committee.
Follow-up to the Report of a Violation
The Human Resources Department may arrange a meeting with the employee to allow the employee to present a complete description of the situation. The Human Resources Department will take the matter under consideration, including undertaking any necessary investigation or evaluation of the facts related to the situation and, after consultation with the President and Chief Executive Officer, shall render a written decision, response or explanation as expeditiously as possible. Individuals who are alleged to be involved in a violation will not participate in its investigation.
Determining Whether a Violation Has Occurred
If the alleged violation of this Code concerns an executive officer or director, the determination of whether a violation has occurred shall be made by the Audit Committee of the Board of Directors, in consultation with such external legal counsel as the Audit Committee deems appropriate.
If the alleged violation concerns any other employee, the determination of whether a violation has occurred shall be made by the President and Chief Executive Officer, in consultation with external legal counsel as such officers deem appropriate.
In determining whether a violation of this Code has occurred, the committee or person making such determination may take into account to what extent the violation was intentional, the materiality of the violation from the perspective of either the detriment to the Company or the benefit to the director, executive officer or employee, the policy behind the provision violated and such other facts and circumstances as they shall deem advisable.
Acts or omissions determined to be violations of this Code by other than the Audit Committee under the process set forth above shall be promptly reported by the Human Resources Department to the Audit Committee and by the Audit Committee to the Board.
Reports of suspected violations will be kept confidential to the extent possible and consistent with the conduct of an appropriate investigation.
Retaliation in any form against an employee who has, in good faith, reported a violation of this Code will not be tolerated.
Consequences of a Violation
Employees who violate this Code, or who fail to report violations of which they are aware or should be aware, will subject themselves to disciplinary action up to and including dismissal. Some violations may also result in civil liability and/or lead to criminal prosecution.
Whenever the requirement for prior approval appears in this Code, it means that a writing setting forth the pertinent facts of the situation under consideration shall be submitted according the following process.
If a request for prior approval relates to an executive officer or director, the determination with respect to the approval shall be made by the Audit Committee of the Board of Directors, in consultation with such external legal counsel as the Audit Committee deems appropriate.
If a request for prior approval relates to any other employee, the determination shall be made by the President and Chief Executive Officer, in consultation with the Human Resources Department, unless the matter is quantitatively or qualitatively material or outside the ordinary course of business, in which case such determination shall be made by the Audit Committee.
All approvals (other than those approved by the Audit Committee) shall be promptly reported to the Audit Committee.
You must request a waiver of a provision of this Code if there is a reasonable likelihood that your contemplated action will violate the Code.
If a waiver request relates to an executive officer or director, the determination with respect to the waiver shall be made by the Audit Committee of the Board of Directors, in consultation with such external legal counsel as the Audit Committee deems appropriate. Any waivers granted by such committee shall be submitted to the Board for ratification.
If a waiver request relates to any other employee, the determination shall be made by the President and Chief Executive Officer, unless the matter is quantitatively or qualitatively material or outside the ordinary course of business, in which case such determination shall be made by the Audit Committee.
All waivers of this Code (other than those approved by the Audit Committee) shall be promptly reported to the Audit Committee.
Waivers will not be granted except under extraordinary or special circumstances.
Any waivers of this Code for any executive officer or director of the Company must promptly be disclosed to shareholders.
Updates and Changes
This Code will be reissued from time to time to remind employees, officers and directors of its specifics and to make changes and clarifications based on experience and suggestions.
Jeffrey L. Cunningham
President and Chief Executive Officer
Michael R. Hutsell
Vice President, Chief Operating Officer and Chief Financial Officer
ATHENS BANCSHARES CORPORATION AND SUBSIDIARIES
AUDIT COMMITTEE CHARTER
The purpose of the Audit Committee (the “Committee”) of the Board of Directors (the “Board”) of Athens Bancshares Corporation and Subsidiaries (the “Company”) is to assist the Board with oversight of the quality and integrity of the Company’s financial reporting, compliance with legal and regulatory requirements, the Company’s independent auditing firm’s qualifications and independence, and the performance of the Company’s internal audit function and its independent auditing firm.
The Committee shall be comprised of three or more directors, each of whom shall satisfy the definition of independent director as defined in any qualitative listing requirements for NASDAQ Stock Market, Inc. issuers. All members of the Committee should be financially literate at the time of appointment, meaning they should have the ability to read and understand fundamental financial statements, including the Company’s balance sheet, income statement and cash flow statement. Committee members shall be elected by the Board on an annual basis. Members shall serve until their successors are appointed. The Committee’s chairperson shall be designated by the full Board or, if it does not do so, the Committee members shall elect a chairperson by vote of a majority of the full Committee.
III. Structure and Meetings
The Committee shall meet four times per year, or more frequently as circumstances may require. A quorum of the Committee shall be declared when a majority of the appointed members of the Committee are in attendance. The Committee chairperson shall preside at the meeting and, in consultation with other members of the Committee, will set the frequency and length of each meeting and the agenda of the items to be addressed at each meeting. The Committee chairperson shall ensure that the agenda for each meeting is circulated to each Committee member in advance of the meeting. The Committee shall keep written minutes of all meetings.
IV. Goals and Responsibilities
In carrying out its responsibilities, the Committee believes its policies and procedures should remain flexible to best react to changing conditions and to ensure to the directors and shareholders that the corporate accounting and reporting practices of the Company are in accordance with all requirements and are of the highest quality. To fulfill its responsibilities and duties, the Committee shall:
- Facilitate an open avenue of communication between management, the independent auditing firm and the Board.
- Meet with the independent auditing firm, internal audit and management at least quarterly to review the Company’s financial statements. In meetings attended by the independent auditing firm or by regulatory examiners, a portion of the meeting will be reserved for the Committee to meet in closed session with these parties.
- Review all significant risks or exposures to the Company found during audits performed by the independent auditing firm and internal audit and ensure that these items are discussed with management. From these discussions, assess and report to the Board regarding how the findings should be addressed.
- Review recommendations from the independent auditing firm regarding internal controls and other matters relating to the accounting policies and procedures of the Company.
- Following each meeting of the Committee, the chairperson of the committee will submit a record of the meeting to the Board, including any recommendations that the Committee may deem appropriate.
- Ensure that the independent auditing firm discusses with the Committee their judgments about the quality, not just the acceptability, of the Company’s accounting principles as applied in the financial reports. The discussion should include such issues as the clarity of the Company’s financial disclosures and degree of aggressiveness or conservatism of the Company’s accounting principles and underlying estimates and other significant decisions made by management in preparing the financial disclosures.
- Review with the independent auditing firm the matters required to be discussed by Statement on Auditing Standards No. 16 (Communications With Audit Committees) relating to the conduct of the audit, any difficulties encountered in the course of the audit, any restrictions on the scope of activities or access to requested information, and any significant disagreements with management.
- Review the Company’s annual audited financial statements and the independent auditing firm’s opinion regarding such financial statements, including a review of the nature and extent of any significant changes in accounting principles.
- Review with management, the independent auditing firm and legal counsel, legal and regulatory matters that may have a material impact on the financial statements.
- Generally discuss earnings press releases and financial information, as well as earnings guidance provided to analysts and rating agencies.
- Select the independent auditing firm, considering independence and effectiveness, and be ultimately responsible for their compensation, retention and oversight (including resolution of disagreements between management and the independent auditing firm regarding financial reporting) for the purpose of preparing or issuing an audit report or related work, and each such independent auditinng firm shall report directly to the Committee. The Committee should confirm the independence of the independent auditing firm by requiring them to disclose in writing all relationships that, in the independent auditing firm’s professional judgment, may reasonably be thought to bear on the ability to perform the audit independently and objectively. The Committee shall also review with the independent auditing firm the matters required to be discussed by PCAOB Rule 3526 (Communications With Audit Committees Concerning Independence).
- Review the performance of and scope of work performed by the independent auditing firm.
- Review and advise on the appointment of the internal auditor. The internal auditor will report directly to the Committee. Approve the internal audit charter, policies and procedures, and audit plan annually. The Committee shall also review significant reports prepared by internal audit, together with management’s responses. The Committee shall review the performance of the internal auditor annually.
- Have in place procedures for (1) receiving, retaining and treating complaints regarding accounting, internal accounting controls, or auditing matters, and (2) the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.
- Approve, in advance, all permissible non-audit services to be completed by the independent auditing firm. Such approval process will ensure that the independent auditing firm does not provide any non-audit services to the Company that are prohibited by law or regulation.
- Set clear hiring policies for hiring employees or former employees of the independent auditing firm.
- The Audit Committee shall review periodically, but no less frequently than quarterly, a summary of the Company’s transactions with directors and executive officers of the Company and with firms that employ directors, as well as any other related person transactions, for the purpose of recommending to the disinterested members of the Board of Directors that the transactions are fair, reasonable and within Company policy and should be ratified and approved. “Related person” and “transaction” shall have the meanings given to such terms in Securities and Exchange Commission Regulation S-K, Item 404, as amended from time to time.
V. Performance Evaluation and Disclosure Obligations
In addition to the responsibilities presented above, the Committee will examine this Charter on an annual basis to assure that it remains adequate to address the responsibilities of the Committee.
VI. Audit Committee Resources
The Committee shall be authorized to retain independent counsel and other advisors as it deems necessary to carry out its duties. In connection therewith, the Committee shall be provided appropriate funding, as determined by the Committee, for payment to such counsel and other advisors. In addition, the Committee shall be provided funding for ordinary administrative expenses of the Committee.
Lyn B. Thompson, Audit Committee Chairman
Larry D. Wallace, Chairman of the Board of Directors
LAST REVIEWED: MARCH 2016
LAST REVISED: MARCH 2016
ATHENS BANCSHARES CORPORATION
COMPENSATION COMMITTEE CHARTER
As adopted on September 16, 2009
The Compensation Committee (the “Committee”) of the Board of Directors of Athens Bancshares Corporation (the “Company”) is responsible for personnel policies, salaries and benefits, incentive compensation and management succession planning.
The Committee shall consist of three or more directors, each of whom shall satisfy the definition of independent director as defined in any qualitative listing requirements for NASDAQ Stock Market, Inc. issuers and any applicable Securities and Exchange Commission rules and regulations.
Committee members shall be elected annually by the Board. Members shall serve until their successors are appointed. The Committee’s chairperson shall be designated by the full Board or, if it does not do so, the Committee members shall elect a chairperson by vote of a majority of the full Committee. The President and Chief Executive Officer will meet with the Committee, but the President and Chief Executive Officer will not be a member of the Committee and will be excused when matters specifically related to the President and Chief Executive Officer are discussed.
The Committee may form and delegate authority to subcommittees when appropriate.
III. Structure and Meetings
The Committee shall meet at least annually, or more frequently as circumstances dictate. The chairperson of the Committee will preside at each meeting and, in consultation with the other members of the Committee, will set the frequency and length of each meeting and the agenda of items to be addressed at each meeting. The chairperson of the Committee shall ensure that the agenda for each meeting is circulated to each Committee member in advance of the meeting. The Committee shall keep written minutes of all meetings.
IV. Goals and Responsibilities
In carrying out its responsibilities, the Committee shall:
- Be responsible for developing and maintaining an executive compensation policy that creates a direct relationship between pay levels and corporate performance and returns to shareholders. The Committee shall monitor the results of such policy to assure that the compensation payable to the Company’s executive officers provides overall competitive pay levels, creates proper incentives to enhance shareholder value, rewards superior performance and is justified by the returns available to shareholders.
- Be responsible for approval of compensation and benefit plans, which may include amendments to existing plans, cash- and equity-based incentive compensation plans, and non-qualified deferred compensation and retirement plans.
- Be responsible for overseeing the administration of the Company’s benefit programs.
- Establish annually subjective and objective criteria to serve as the basis for the President and Chief Executive Officer’s compensation, evaluate the President and Chief Executive Officer’s performance in light of those criteria and determine the President and Chief Executive Officer’s compensation based on that evaluation.
- Establish annually subjective and objective criteria to serve as the basis for the other executive officers’ compensation, evaluate the other executive officers’ performance in light of those criteria and determine the other executive officers’ compensation based on that evaluation. The Committee may consult with the President and Chief Executive Officer with respect to the compensation of other executive officers.
- If and when the requirements of Securities and Exchange Commission Regulation S-K, Item 402, apply to the Company, review and discuss with management the Compensation Discussion and Analysis required by Securities and Exchange Commission Regulation S-K, Item 402. Based on such review and discussion, the Committee shall determine whether to recommend to the Board of Directors that the Compensation Discussion and Analysis be included in the Company’s annual report or proxy statement for the annual meeting of shareholders. The Committee shall provide, over the names of the Committee members, the required Compensation Committee report for the Company’s proxy statement for the annual meeting of shareholders.
- With respect to the Company’s equity-based compensation plans, approve grants of stock options, restricted stock, performance shares, stock appreciation rights and other equity-based incentives to the extent provided under the compensation plans. The Committee may delegate to the President and Chief Executive Officer all or part of the Committee’s authority and duties with respect to grants and awards to individuals who are not subject to the reporting requirements and other provisions of Section 16 of the Securities Exchange Act of 1934 as in effect from time to time.
- From time to time review and make recommendations to the Board of Directors regarding the compensation of non-employee directors.
V. Performance Evaluations
The Chairman of the Committee shall discuss the Committee’s performance with each member of the Committee, following which discussions the Chairman shall lead the Committee in an annual evaluation of its performance. The Committee shall conduct an annual performance evaluation and review and reassess the adequacy of this Charter and recommend any proposed changes to the Board for approval.
VI. Committee Resources
The Committee shall have the authority to obtain advice and seek assistance from internal or external legal or other advisors. The Committee shall have available to it such support personnel, including management staff, outside auditors, attorneys and consultants as it deems necessary to discharge its responsibilities. The Committee shall have the sole authority to retain and terminate any compensation consultant used to assist the Committee in evaluating executive compensation, including sole authority to approve such consultant’s fees and other retention terms.
ATHENS BANCSHARES CORPORATION
NOMINATING/CORPORATE GOVERNANCE COMMITTEE CHARTER
Effective March 24, 2016
The primary objectives of the Nominating/Corporate Governance Committee (the “Committee”) are to assist the Board of Directors (the “Board”) of Athens Bancshares Corporation (the “Company”) by: (i) identifying individuals qualified to become Board members and recommending a group of director nominees for election at each annual meeting of the Company’s shareholders; (ii) ensuring that the Audit, Compensation and Nominating/Corporate Governance Committees of the Board shall have the benefit of qualified and experienced “independent” directors; and (iii) developing and recommending to the Board a set of effective corporate governance policies and procedures applicable to the Company.
The Committee shall consist of three or more directors, each of whom shall be an "independent director." In lieu of the Company adopting its own definition of "independent director" following its voluntary delisting from the Nasdaq Stock Market, the definition of "independent director" shall conform to the definition contained in the qualitative listing requirements of the Nasdaq Stock Market.
Committee members shall be elected annually by the Board. Members shall serve until their successors are appointed. The Committee’s chairperson shall be designated by the full Board or, if it does not do so, the Committee members shall elect a Chairman by vote of a majority of the full Committee.
The Committee may form and delegate authority to subcommittees when appropriate.
III. Structure and Meetings
The chairperson of the Committee will preside at each meeting and, in consultation with the other members of the Committee, will set the frequency and length of each meeting and the agenda of items to be addressed at each meeting. The chairperson of the Committee shall ensure that the agenda for each meeting is circulated to each Committee member in advance of the meeting. The Committee shall keep written minutes of all meetings.
IV. Goals and Responsibilities
The Committee shall: (i) develop and recommend to the Board a Corporate Governance Policy (the “Policy”) applicable to the Company, and review and reassess the adequacy of such Policy annually and recommend to the Board any changes deemed appropriate; (ii) develop policies on the size and composition of the Board; (iii) review possible candidates for Board membership consistent with the Board’s criteria for choosing new directors; (iv) annually recommend a slate of nominees to the Board with respect to nominations for the Board at the annual meeting of the Company’s shareholders; and (vi) generally advise the Board (as a whole) on corporate governance matters.
The Committee shall also advise the Board on (i) committee member qualifications, (ii) committee member appointments and removals, (iii) committee structure and operations (including authority to delegate to subcommittees), and (iv) committee reporting to the Board. The Committee shall maintain an orientation program for new directors and a continuing education program for all directors.
The Committee will annually review and reassess the adequacy of this charter and recommend any proposed changes to the Board for approval.
The Committee shall perform any other activities consistent with this charter, the Company’s bylaws and governing law and regulations as the Committee or the Board deems appropriate.
V. Performance Evaluation
The Committee shall conduct an annual performance evaluation of the Board. The evaluation shall be of the Board’s contribution as a whole and specifically review areas in which the Board and/or management believes a better contribution could be made.
VI. Committee Resources
The Committee shall have the authority to obtain advice and seek assistance from internal or external legal, accounting or other advisors. The Committee shall have the sole authority to retain and terminate any search firm to be used to identify director candidates, including sole authority to approve such search firm’s fees and other retention terms.
Athens Bancshares Corporation (OTCQX: AFCB), holding company of Athens Federal Community Bank, trades on the OTCQX best marketplace. Companies meet high financial standards, are current in their disclosure, and are sponsored by a third-party advisor. Investors may find current financial disclosure and Real-Time Level 2 quotes for the company on www.otcmarkets.com.
ATHENS BANCSHARES CORPORATION (OTCQX: AFCB) corporate press releases and financials, news, contact information, and quote and trade information on AFCB stock - http://www.otcmarkets.com/stock/AFCB/news.
ATHENS BANCSHARES CORPORATION (OTCQX: AFCB) corporate press releases and financials, news, contact information, and quote and trade information on AFCB stock - http://www.otcmarkets.com/stock/AFCB/news.
Athens Bancshares Corporation
PO Box 869
Athens, TN 37371-0869
Investor Relations Contact
Michael R. Hutsell
Vice President and Chief Operating Officer