DIRECTOR CODE OF ETHICS

 

Responsibilities

 

This Director Code of Ethics (“Code of Ethics” or “Code”) is a guide to ethical considerations with respect to your status as a Director of Community National Coporation (the “Company”). The Board of Directors provides the Company senior management with general guidance and advice concerning the competent and ethical operation of the Company. The Company Directors likewise will execute their responsibilities in a highly ethical manner, consistent with this Code of Ethics and applicable legal requirements and stock exchange regulations. Directors will regularly review this Code to monitor compliance and consider modifications.

 

General Conflicts of Interest

 

Each Director must consider other existing and anticipated commitments so that such commitments do not materially interfere with the members’ service as a Director.  The Company Directors must avoid situations where personal or other loyalties may conflict with the interests of the Company.  The Company Directors should endeavor to avoid the appearance of a conflict of interest, or should disclose and explain such appearance to the Board of Directors so that a determination can be made of whether an actual conflict exists.

 

Personal Benefit from Company Business

 

The Company Directors may not receive any loans, consulting fees, or other material personal profit or benefit in connection with any transaction involving the Company, other than compensation and expense payments or committee fees as a Director (or in the case of a Director employed by the Company, compensation as an employee), as approved by the full Board. Other than such payments, Directors must disclose to the Company’s Chairman of the Board or President any transaction, or proposed transaction, between a Company entity and you, a member of your immediate family, or a business you or an immediate family member own, control, or have a substantial interest in (more than 5% of the outstanding voting securities).

 

Other Businesses

 

The Company Directors may not have a personal or family financial interest in any Company supplier, customer, consultant, reseller or competitor that has a reasonable potential for causing a conflict of interest, or divided loyalty, or resulting in material personal gain. Whether there may be the potential for a conflict of interest, divided loyalty or personal gain depends on many factors, including the Director’s ability to influence the Company decisions that affect personal interests, the size of the any potential personal gain relative to the Director’s other resources, and the nature of the relationship between our Company and the other business. In any event, the potential for personal gain or other divided loyalty must be disclosed to the full Board.

 

Other Directorships and Positions

 

Except as permitted by applicable competition, antitrust, and securities laws, the Company Directors may not be a director, employee, or consultant of a company or organization that produces, supports or promotes products or services that compete with the Company to any material extent. Prior to joining any other board or accepting an executive position with a company that does business with the Company or may compete with the Company, you must consult with the Company’s Chairman of the Board and President (if separate). If in your position as a Director, employee, or consultant of another organization you encounter any situation where your role with that other organization may be in conflict with the Company’s interests, you must inform the Company’s Chairman of the Board and President of the potential conflict so that appropriate action can be taken.

 

Confidentiality in General

 

Company technical, research, development, personnel, financial, strategic, and other business information are Company property and must be kept confidential.

 

Communication Regarding the Company

 

Confidential information about the Company, including information that can be expected to have an impact on the market for Company stock, forward-looking information such as revenue or earnings projections or other non-public information, may be released only in accordance with Company guidelines and United States securities laws. Contacts with news organizations, analysts, or shareholders should be directed promptly to the Chairman of the Board or President. Director communication involving Company matters are expected to be coordinated with and through Company management, except as contemplated by applicable committee charters or as approved by the full Board.

 

Inside Information

 

As a Director, you have information about the Company that is both material and non-public. You must adhere to the Company’s Stock Trading Policy, United States securities laws, and exchange requirements regarding trading and reporting trades in Company stock. Violation of insider trading laws subject both you and the Company to potential severe criminal penalties. These laws and Company policy apply to all Company Directors and every stock transaction, regardless of size, and to all disclosures of material non-public information, whether or not you personally benefit. Directors are required to obtain prior written approval of any transaction in Company stock[, including option exercises]. In addition, you may not ‘tip” others who may trade in Company stock.

 

Handling Company Assets

 

Director must take care to safeguard Company assets, including protection from unauthorized use. Company assets may not be used for personal benefit or any unlawful or improper purposes. Directors must consult with the Chairman of the Board or President regarding the preservation and production of documents in the event of litigation or investigation regarding the Company.

 

Director Independence

 

The Company Board must be comprised of a majority of independent directors. As described in this Code, Directors must disclose transactions involving the Company that may result in divided loyalty or personal gain or profit, and thereby potentially affect director independence. The Board will, at least annually, determine whether or not each Board member is independent, in accordance with applicable law, regulation, and listing standards.

 

Relationship to Other Policies

 

If a Director is also a Company employee, the Company Code of Business Conduct and related policies also apply to you. In addition, as a member of any committee of the Board of Directors, the applicable committee charter(s) should also guide your conduct. Any waiver of the requirements of this Code in favor of Directors must be approved by the Board of Directors and must be disclosed as required by law or exchange regulation.