The honesty, integrity and sound judgment of
our directors, officers and employees is essential to First South
Bancorp’s reputation and success.
This Code of Ethics governs the actions and working
relationships of directors, officers and employees of First South
Bancorp, Inc. and its subsidiaries and affiliates (collectively,
“First South Bancorp”) with current and potential customers,
consumers, fellow employees, competitors, government and self-regulatory
organizations, the media, and anyone else with whom First South
Bancorp has contact. These relationships are essential to the continued
success of First South Bancorp as a financial services provider.
This Code of Ethics:
– Requires the highest standards for honest and
ethical conduct, including proper and ethical procedures for dealing
with actual or apparent conflicts of interest between personal and
– Requires full, fair, accurate, timely and understandable
disclosure in the periodic reports required to be filed by First
South Bancorp with governmental and regulatory agencies.
– Requires compliance with applicable laws, rules
– Addresses potential or apparent conflicts of
interest and provides guidance for directors, officers and employees
to communicate those conflicts to First South Bancorp.
– Addresses misuse or misapplication of First
South Bancorp property and corporate opportunities.
– Requires the highest level of confidentiality
and fair dealing within and outside the First South Bancorp environment.
– Requires reporting of any illegal behavior.
IDENTIFICATION OF SENIOR EXECUTIVE AND
Certain provisions of this Code of Ethics apply
to senior executive and financial officers but not to other employees.
For purposes of this Code of Ethics, First South Bancorp’s
senior executive and financial officers shall consist of all officers
with the title of Executive Vice President or higher, as well as
First South Bank’s Treasurer/Controller. Except where otherwise
specifically stated herein, this Code of Ethics applies to all directors,
officers and employees.
POLICY REGARDING ACCEPTING GIFTS AND CONFLICTS OF INTEREST
Directors, officers and employees are advised
that they are required to comply with the First South Policy Regarding
Accepting Gifts and Conflicts of Interests (the “Conflicts
Policy”). A copy of the Conflicts Policy is attached to this
Code of Ethics and is considered an integral part of this Code of
Ethics. Any violations of the Conflicts Policy will be considered
a violation of this Code of Ethics, and any director, officer or
employee seeking a waiver from any provision of the Conflicts Policy
must comply with the requirements of this Code of Ethics set forth
under “Administration and Waiver of Code of Ethics”
Directors, officers and employees are prohibited
(i) Personally benefiting from opportunities
that are discovered through the use of First South Bancorp property,
contacts, information or position.
(ii) Accepting employment or engaging in a business
(including consulting or similar arrangements) that may conflict
with the performance of your duties or First South Bancorp’s
(iii) Soliciting, demanding, accepting or agreeing
to accept anything of value from any person in conjunction with
the performance of your employment or duties at First South Bancorp.
(iv) Acting on behalf of First South Bancorp
in any transaction in which you or your immediate family has a significant
direct or indirect financial or other interest.
There are certain situations in which you may
accept a personal benefit from someone with whom you transact business.
These situations are described in the Conflicts Policy.
It is both unethical and illegal to buy, sell, trade or otherwise
participate in transactions involving First South Bancorp common
stock or other security while in possession of material information
concerning First South Bancorp that has not been released to the
general public, but which when released may have an impact on the
market price of the First South Bancorp common stock or other equity
security. It is also unethical and illegal to buy, sell, trade or
otherwise participate in transactions involving the common stock
or other security of any other company while in possession of similar
non-public material information concerning such company. Directors,
officers and employees are advised that they are required to comply
with the First South Bancorp, Inc. Policies and Procedures Governing
Trading in Securities (the “Insider Trading Policy”).
Any questions concerning the propriety of participating in a First
South Bancorp or other company stock or other security transaction
should be directed to the Chief Financial Officer at (252) 940-5017.
Copies of the Insider Trading Policy are available from First South
Bancorp’s Chief Financial Officer.
OUTSIDE BUSINESS RELATIONSHIPS
Directors and senior executive and financial
officers should disclose all new directorships or potential directorships
to the Chairman of the Audit Committee of the Board of Directors
in order to avoid any conflicts of interest. Senior executive and
financial officers of First South Bancorp are prohibited from holding
outside employment. Other employees should notify their supervisors
of outside directorships or employment to ensure it does not create
a conflict of interest.
First South Bancorp encourages civic, charitable,
educational and political activities as long as they do not interfere
with the performance of your duties at First South Bancorp.
Each director, officer and employee should undertake
to deal fairly with First South Bancorp’s customers, suppliers,
competitors and employees. Additionally, no one should take advantage
of another through manipulation, concealment, abuse of privileged
information, misrepresentation of material facts, or any other unfair-dealing
Senior executive and financial officers and other
employees must disclose prior to or at their time of hire the existence
of any employment agreement, non-compete or non-solicitation agreement,
confidentiality agreement or similar agreement with a former employer
that would in any way restrict or prohibit the performance of any
duties or responsibilities of their positions with First South Bancorp.
Copies of such agreements should be provided to the Vice President
of Human Resources to permit evaluation of the agreement in light
of the employee’s position. In no event shall an employee
use any trade secrets, proprietary information or other similar
property, acquired in the course of his or her employment with another
employer, in the performance if his or her duties for or on behalf
of First South Bancorp.
Directors, officers and employees should not
directly or indirectly accept bequests under a will or trust if
such bequests have been made to them because of their employment
or service with First South Bancorp.
PROTECTION AND PROPER USE OF FIRST SOUTH BANCORP PROPERTY
All directors, officers and employees should
protect First South Bancorp’s property and assets and ensure
their efficient and proper use. Theft, carelessness and waste can
directly impact First South Bancorp’s profitability, reputation
and success. Permitting First South Bancorp property (including
data transmitted or stored electronically and computer resources)
to be damaged, lost, or used in an unauthorized manner is strictly
prohibited. Directors, officers and employees may not use corporate,
bank or other official stationery for personal purposes.
COMPLIANCE WITH LAWS, RULES AND REGULATIONS
This Code of Ethics is based on First South Bancorp’s
policy that all directors, officers and employees comply with the
law. While the law prescribes a minimum standard of conduct, this
Code of Ethics requires conduct that often exceeds the legal standard.
PREPARATION OF PERIODIC REPORTS FILED WITH GOVERNMENTAL
AND REGULATORY AGENCIES
Particular care is required in the preparation
of First South Bancorp’s filings (“Securities Reports”)
with the Securities and Exchange Commission (“SEC”)
pursuant the Securities Act of 1933, as amended and the Securities
Exchange Act of 1934, as amended and the rules and regulations of
the SEC thereunder (collectively, the “Securities Laws”),
as well as First South Bancorp’s filings and communications
(collectively, “Regulatory Reports”) with federal and
North Carolina bank regulatory authorities. It is essential that
First South Bancorp’s Securities Reports contain full, fair,
accurate, timely and understandable disclosure and otherwise comply
with the letter and spirit of the Securities Laws for the protection
of First South Bancorp and its stockholders and to engender public
confidence in the information provided by First South Bancorp in
its Securities Reports. Similarly, it is essential that First South
Bancorp’s Regulatory Reports contain full, fair, accurate,
timely and understandable disclosure and otherwise comply with the
letter and spirit of applicable federal and state banking laws and
regulations (“Banking Laws”). Accordingly, the directors,
senior executive and financial officers and other officers and employees
involved in the preparation of Securities Reports and Regulatory
Reports must use their best efforts to ensure that First South Bancorp’s
Securities Reports and Regulatory Reports and other public communications
made by First South Bancorp contain full, fair, accurate, timely
and understandable disclosure and that First South Bancorp at all
times complies in all material respects with the letter and spirit
of the Securities Laws and the Banking Laws.
REPORTING OF ILLEGAL OR UNETHICAL BEHAVIOR AND VIOLATIONS OF THIS
CODE OF ETHICS
All directors, officers and employees are expected
to demonstrate the ability to properly manage their personal finances,
particularly the prudent use of credit. First South Bancorp recognizes
that its customers must have faith and confidence in the honesty
and character of its senior executive and financial officers. In
addition to the importance of maintaining customer confidence, there
are specific laws that outline the actions First South Bancorp must
take regarding any known, or suspected, crime involving the affairs
of First South Bancorp. With regard to financial affairs, a bank
must make a criminal referral in the case of any known, or suspected,
theft, embezzlement, check/debit card fraud, kiting, misapplication
or other defalcation involving bank funds or bank personnel in any
Fraud is an element of business that can significantly
affect the reputation and success of First South Bancorp. First
South Bancorp requires its senior executive and financial officers
and employees to talk to the Vice President of Human Resources,
reporting directly to the Audit Committee of the Board of Directors,
to report and discuss any known or suspected criminal activity involving
First South Bancorp or its employees. If, during the course of employment,
you become aware of any suspicious activity or behavior including
concerns regarding questionable accounting or auditing matters,
you must report violations of laws, rules, regulations or this Code
of Ethics to the Vice President of Human Resources, reporting directly
to the Audit Committee of the Board of Directors. Reporting the
activity will not subject you to discipline absent a knowingly false
ADMINISTRATION AND WAIVER OF CODE OF ETHICS
This Code of Ethics shall be administered and
monitored by the First South Bancorp Vice President of Human Resources,
reporting directly to the Audit Committee of the Board of Directors.
Any questions and further information on this Code of Ethics should
be directed to this individual.
It is also the responsibility of the Vice President
of Human Resources to annually reaffirm compliance with this Code
of Ethics by all senior executive and financial officers, and to
obtain a signed certificate that each senior executive and financial
officer has read and understands the guidelines and will comply
with them. Senior executive and financial officers will be required
to sign a receipt form indicating they have read this Code of Ethics
and will comply with its provisions.
Directors, officers and employees of First South
Bancorp are expected to follow this Code of Ethics at all times.
Generally, there should be no waivers to this Code of Ethics. However,
in rare circumstances conflicts may arise that necessitate waivers.
Waivers will be determined on a case-by-case basis by the Audit
Committee of the Board of Directors. The Audit Committee of the
Board of Directors shall have the sole and absolute discretionary
authority to approve any deviation or waiver from this Code of Ethics.
Any waiver and the grounds for such waiver by directors, officers
or employees shall be promptly disclosed to stockholders in a Current
Report on Form 8-K.
Known or suspected violations of this Code of
Ethics will be investigated and may result in disciplinary action
up to and including immediate termination of employment in the case
First South Bancorp will provide to any
person without charge, upon request, a copy of this Code of Ethics.
Such request should be made, in writing, to: Corporate Secretary,
First South Bancorp, Inc., 1311 Carolina Avenue, Washington, North