GENERAL POLICY
It is the policy of Pathway Bancorp, Pathway Bank and Pathway Financial (collectively Pathway) that its directors and employees utilize corporate assets in a prudent manner and as such are prohibited from engaging in excessive or luxury expenditures. Directors and employees are required to follow strict standards regarding expenditures for the following purposes: travel, entertainment and events, office or facility renovations, aviation or other transportation services and other similar items, activities or events for which Pathway 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, including without limitation, legitimate travel and meeting- related costs for attendance at conferences and meetings in appropriate environments for purposes of professional development, education, training, networking and best practice sharing, and attendance at community charitable and social events where the presence of Pathway staff is a necessary part of Pathway's community involvement and support.
Travel Expenses
All business travel related expenses, including reimbursement of meals, incurred by a director or employee shall be submitted on an employee expense report and if in excess of $300.00 per month, approved by such employee's supervisor before being submitted for payment or reimbursement. Reimbursement requests by directors shall be submitted to the Chairman of the Board of Directors. Reimbursement requests by the Chief Executive Officer or the Chairman of the Board of Directors shall be submitted to another Director for approval.
Air Travel
Air travel by directors and employees on Pathway business shall be by commercial airline. Pathway does not own or lease, and does not intend to own or lease any private aircraft for use by Pathway employees or directors. Expenditures for travel on private aircraft are prohibited.
Automobile Expenses
Pathway 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 employees. Such vehicles shall not be for the exclusive use of one employee but shall be made available for business related travel by any employee. Employees or directors using their personal vehicles for business purposes shall be reimbursed at a rate per mile not to exceed the standard IRS guideline rate in effect at the time of travel. Directors and employees will be reimbursed for parking and tolls when these expenses are required in the course of business travel.
Lodging
Employees and directors are encouraged to avoid overnight stays when one-way travel time for a one day meeting is three hours or less and concludes no later than 5:00 p.m. When possible all lodging should be booked in hotels offering special conference rates or corporate rates.
Entertainment Expenses
All expenditures by directors or employees for entertainment must be for the purpose of maintaining or increasing business to Pathway. Requests for reimbursement for such expenditures
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must be justified and supported by documentation and approved by the appropriate supervisor as described in the section entitled Travel Expenses.
Office and Facility Renovations
All proposed office and facility capital improvements and/or renovations with a cost exceeding $10,000 must be approved in writing by the CEO prior to commencement of any such activities. Such proposed expenditures by the CEO must be approved by the Chairman of the Board of Directors. All other proposed office or facility improvements and/or renovations with a cost of $10,000 or less shall be approved by the appropriate department supervisor and be within the allocated budget for the fiscal year. Expenditures for office furnishings, remodeling or redecoration for any senior executive office (SEO) the aggregate cost of which exceeds $25,000 is prohibited. This prohibition does not extend to a corporate relocation or remodeling impacting a majority of the corporate offices or a newly-constructed branch or branch renovation, nor does it apply in the event remodeling or redecoration is required because of an emergency situation such as damage caused by fire or storm.
Expenditures for Activities and Events
The Chief Executive Officer's prior approval is required for expenditures for an activity or event where the total cost exceeds $2,000. If the cost exceeds $5,000, prior approval of the Board of Directors is required. Such events shall be limited to staff development, customer appreciation and other similar activities and events.
Employee Parties
The Board of Directors believes that company-wide periodic holiday or other seasonal parties are important in terms of recognizing employees for their loyalty and dedication. Accordingly this policy does not prohibit expenditures in conjunction with such events. However, such employee events shall be limited in cost not to exceed $6,000 per year and the budget for each event shall be approved by the Chief Executive Officer.
Documentation
All Pathway expenditures, including those expenditures coverd by this policy, shall be documented, reported, supported by written invoices and receipts and subject to audit in accordance with standard Pathway policies and procedures.
Reporting
Violations & Disciplinary Actions
An employee or director who learns of a violation of this policy shall promptly report the violation to the Chief Executive Officer. Compliance with this policy is a condition of employment and any violation thereof may result in disciplinary action.
Certification of Compliance
The Chief Executive Officer and the Chairman of the Board shall certify at least annually that this policy is being followed and that the approval any expenditure requiring prior approval of an executive officer or Pathway's Board of Directors was properly obtained with respect to each such expenditure.
Amendments and Modifications
This policy shall be subject to modication only with the approval of the Board, stating the specific business rationale for the change in policy.
Approved by Pathway Bancorp Board of Directors, November 13, 2009
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