1. Direct the Affairs of the Association for the Benefit of the Members
   
   The Board believes that the primary responsibility of directors is to oversee the affairs of the Association for the benefit of the members.
   
   The Board further believes that day-to-day management of the Association is the responsibility of management and that the role of the Board is to oversee management’s performance of that function.
   
   The responsibility of directors is to exercise their business judgment to act in what they reasonably believe to be in the best interests of the Association and its members. In discharging that obligation, directors are entitled to rely on the honesty and integrity of the Associations senior executives and its independent advisors and auditors. Directors are expected to attend Board meetings and meetings of committees on which they serve, and to spend the time needed and meet as frequently as necessary to properly discharge their responsibilities with due care. Directors should review in advance any information and data that are distributed in writing to directors before meetings.
    

2. Long-Range Strategy Development
   
   The Board believes that long-range strategic planning and development should target the fulfillment of the Association’s mission, vision, and multi-year member goals as approved by the Board.
    

3. Review of Financial Goals and Performance
   
   The Board approves the annual operating plan consistent with the goals and strategies prior to the start of the fiscal year and financial performance periodically, but not less than quarterly, during the year (actual and in comparison to plan). The Board also believes it is important to establish and evaluate longer-term objectives and not to over-emphasize short-term performance.
    

4. Ethical Business Environment
   
   The Board believes that the long-term success of the Association is dependent upon the maintenance of an ethical business environment that focuses on adherence to both the letter and the spirit of regulatory and legal mandates, as well as the Association’s Code of Business Conduct and Ethics. The Board and its oversight committees (Finance, Benefits, and Governance) expect management to conduct operations in the manner supportive of the Board’s view.
   
   The Board and committee agenda and materials are established with legal and regulatory requirements in mind, including periodic reports by management on various ethical, regulatory and legal topics. In addition to putting such topics on the agenda for Board meetings, Board members may request additional material and presentation from internal and/ or external counsel whenever they deem it appropriate. Independent auditors will be retained by the Board to annually report on the Association’s financial condition and results of operations.
    

5. President’s Performance Evaluation
   
   The Board believes that the President’s performance should be evaluated annually related to his progress toward long-term goals and strategies as well as current year results as a regular part of any decision with respect to the President’s compensation. The Board and the Governance Committee share this responsibility jointly. The Board, after approval of the President’s annual goals, has delegated responsibility to the Governance Committee to evaluate the President’s performance. The Finance Committee will evaluate all salary, bonus and long-term incentive awards. All compensation arrangements will be included in the President’s employment agreement.
   
   The President’s salary, bonus and long-term incentives will be approved by the Board (with the President being excused from the meeting) following the Committee’s action. Discussion of the President’s performance is part of the ratification process. The Chairperson of the Board and/or the Chairperson of the Governance Committee will review comments of the Board with the President following each such meeting, as appropriate.
   
   The Board believes that evaluation of the President should be an objective process, based on both qualitative and quantitative factors, including the execution and performance of the business processes, accomplishment of long-term objectives, positioning of the Association for the future, development of management and leadership of the Association in both the industry and market segments in which it competes.
    

6. Compensation of Other Association Officers
   
   The Board establishes the compensation and benefits programs for other Association officers. The Board has delegated oversight of compensation and benefits plans to the Governance Committee, under policies and procedures approved by the Board which include regular reporting to the Board.
    

7. Classification of the Board
   
   Under its Bylaws, the Association maintains a classified Board. A classified Board provides both appropriate continuity on the Board and negotiating strength to achieve maximum value for all members.
   
   The Association’s Board is divided into three classes, each roughly equal in size, for election to a three-year term. If a new Board member is not elected to a class directly by the member’s at the annual meeting, he or she will serve until the next annual meeting, in accordance with the Bylaws, and then will be assigned by the Board to a class, guided primarily by the need to balance the classes in size.

B. MEETINGS OF THE BOARD OF DIRECTORS

1. Frequency of Meetings
   
   The Board believes that the number of scheduled Board meetings should vary with the circumstances and that special meetings should be called as necessary. While the Board recognizes that directors discharge their duties in a variety of ways, including personal meetings and telephone contact with management and others regarding the business and affairs of the Association, the Board feels it is the responsibility of individual directors to make themselves available to attend both scheduled and special Board and committee meetings on a consistent basis. There will be a minimum of four Board meetings annually.
    

2. Executive Sessions of Independent Directors
   
   The Board believes that independent directors should have the opportunity to meet in executive session during Board meetings. Some of the executive sessions should be with the President, who is not an independent director, and some should be absent the President and any other non independent directors or members of management. The agenda for each Board meeting shall provide for an executive session.
   
   It is the policy of the Board for independent directors to meet in executive session in conjunction with each meeting of the Board. Topics at this executive session include President’s compensation and performance (no non independent directors are present), management succession (the President is generally present) and other topics determined by the Board and the President (the President may or may not be present during these discussions, at the option of the Board). Following each executive session, the results of deliberations and any recommendations should be communicated to the President by the Chairperson or Vice Chairperson.
    

3. Access to Management
   
   Board members have complete access to management. The Chairman of the Finance Committee has access to the Chief Financial Officer. It is assumed that Board members will use judgment to ensure that contact is not distracting to the business operations of the Association and that such contact, if in writing, to be copied to the President and the Chairperson of the Board.
    

4. Attendance of Non-Directors at Meetings
   
   The Board believes that the Chairperson of the Board or the President should have discretion to invite such members of management or guests as the Chairman or President deems appropriate to attend the Board meetings, subject to the Board’s right to request that such attendance be limited or discontinued.
   
   The Board believes it is important for directors to have exposure to the Association’s key managers, advisors and consultants and believes their limited attendance at and participation in Board meetings may be useful in attaining the Association’s objectives.
    

5. Agenda and Presentations
   
   The Board believes that Chairperson of the Board and the President should establish the agenda for each Board meeting, taking into account suggestions of Board members.
   
   Board members are encouraged to suggest the inclusion of particular items on the agenda and the Chairperson from time to time is expected to ask directors for their suggestions or opinions on possible agenda items.
   
   As with the agenda, the Board believes that the Chairperson and President should determine the form of each presentation to the Board and the person to make such presentation. It is the policy of the Board that the President is responsible to present the financial results of the Association’s operations and related issues at each Board meeting.
    

6. Information Flow
   
   The Board should receive information important to understanding presentations, discussions and issues at each meeting, in writing and sufficiently in advance of the meeting when possible to permit appropriate review. Longer and more complex documents should contain executive summaries. The focus of materials should be on analysis rather than data.
   
   The Board periodically reviews the information flow to Board members to ensure that directors receive the right kind and amount of information from management in sufficient time to prepare for meetings. The Chairperson has directed the Association’s Secretary to coordinate the information flow to the directors and to periodically discuss director satisfaction with Board materials with individual directors and to encourage directors to offer suggestions on materials.

C. BOARD STRUCTURE

1. Director Independence
   
   A super-majority of the directors will be independent directors under the proposed New York Stock Exchange (NYSE) rules.
   
   All future non-employee directors will be independent. Directors who do not meet NYSE’s independence standards can be retained provided they are able to make valuable contributions to the Board and to the Association by reason of their experience and wisdom. To be considered independent under the proposed NYSE rules, the Board must determine that a director does not have any direct or indirect material relationship with the Association or entities with which the Association does business. The Board has established the following guidelines to assist it in determining director independence in accordance with that proposed rule:
    

   1. A director will not be independent if, within the preceding five years: (i) the director was employed by the Association; (ii) an immediate family member of the director was employed by the Association as an officer; (iii) the director was employed by or affiliated with the Association’s (present or former) independent auditor; (iv) an immediate family member of the director was employed by the Association’s (present or former) independent auditor as a partner, principal or manager; or (v) an Association executive officer was on the Board of directors of a company which employed the Association director, or which employed an immediate family member of the director as an officer.
       

   2. The following commercial or charitable relationships will not be considered to be material relationships that would impair a director’s independence: (i) the Association director is an executive officer of another company that does business with the Association and the annual sales to, or purchases from, the Association are less than five percent of the annual revenues of that company; (ii) the Association director is an executive officer of another company which is indebted to the Association, or to which the Association is indebted, and the total amount of either company’s indebtedness to the other is less than five percent of the total consolidated assets of that company; and (iii) the Association director serves as an officer, director or trustee of a charitable organization and the Company’s annual contributions to that organizations are less than $100,000. Any contributions in excess of $100,000 made by the Association will be reviewed by the Governance Committee. The Board will annually review all commercial and charitable relationships of directors. Whether directors meet these categorical independence tests will be reviewed and will be made public annually prior to their standing for reelection to the Board.
       

   3. For relationships not covered by or independent of the guidelines in subsection (b) above, the determination of whether the relationship is material or not, and therefore whether the director would be independent or not, shall be made by the directors who satisfy the independence guidelines set forth in subsections (a) and (b) above, other than the director in question. For example, if a director is the CEO of a company that purchases products and services from the Association that are more than five percent of that company’s annual revenues, the other independent directors could determine, after considering all of the relevant circumstances, whether such a relationship was material or immaterial, and whether the director would therefore be considered independent under the proposed NYSE rules. The Association would explain the basis for any Board determination that a relationship was immaterial despite the fact that it did not meet the categorical standards of immateriality set forth in subsection (b) above.
      
      The Association will not make any personal loans or extensions of credit to directors or executive officers. No director or family member may provide personal services for compensation to the Association, without the express approval of the Governance Committee and disclosure to the Board.
      
      In addition to the requirement that a super-majority of the Board satisfy the independence standards discussed above, members of the Finance Committee must also satisfy an additional NYSE independence requirement. Specifically, they may not directly or indirectly receive any compensation from the Association other than their directors’ compensation. In addition, no payments (other than normal Board compensation) shall be made to any director without the approval of the Governance Committee.
      
      In the event that any director becomes aware of any potential conflict of interest involving any director or nominee for election as director which conflicts with the independence guidelines set for above, it shall be the responsibility of that director to report such conflict to the President of the Association.
       

2. Size of the Board
   
   The Board believes the Association is best served be relatively limited number of Directors, but understands that the size of the Board will fluctuate from time to time depending on circumstances. The Association Bylaws establish the number of seats on the Board. Currently, the maximum number of seats for the Board is nine (9). The Bylaws may be amended by the Board of Directors to change the maximum seats allowed.
    
3. Director Retirement Age and Term Limits
   
   The Board has established a retirement policy for directors which it feels is appropriate for current circumstances. The Governance Committee periodically reviews the retirement policy to ensure that it remains appropriate in light of the Association’s needs.
   
   The Board believes that consistent quality in the directorship can be achieved effectively without term limits. Through the evaluation of the Governance Committee, incumbent directors and the strengths and weaknesses of the Board as a whole are reviewed at least annually.
    
4. Director Appointments
   
   The Board believes that directors should be nominated for Board approval by the Governance Committee of the Board, which consists entirely of independent directors. The Board expects the Governance Committee to consider the views of the Chairperson and the President in making appointments, but it is the Governance Committee’s responsibility to make director recommendations to the full Board for appointments to fill vacancies of any unexpired term on the Board and to recommend nominees for submission to the membership for approval at the Annual Meeting. It is the responsibility of the Chairperson to extend the offer to a director candidate to serve on the Board.
   
   The Company believes that candidates for election to the Board should show evidence of leadership in their particular field, have broad experience and the ability to exercise sound business judgment, possess the highest personal and professional ethics, integrity and values, and be committed to representing the long-term interests of the members. Directors must be willing to devote sufficient time to carrying out their duties and responsibilities effectively, and should be committed to serve on the Board for an extended period of time.
   
   The Governance Committee will annually nominate the Association officers and the Board will consider the nominations and make its decision.
    
5. Chairperson of the Board
   
   The Chairperson of the Board may be an officer or director and may not be the same individual as the President.
    
6. Vice Chairperson
   
   The Board may formally appoint a Vice Chairperson. The Vice Chairperson will assume the responsibilities of chairing any meeting or executive session of the directors at which the Chairperson is not in attendance, or to lead the discussion of a particular matter. The Vice Chairperson will act as a conduit to bring ideas and feedback to the Chairperson and President.
    
7. Director Orientation
   
   In order to promote director effectiveness management is responsible for an orientation process for new directors to the Association, its operation and the policies and procedures of the Board, which may include meeting with key members of management and visits to Association offices and facilities.
    
8. Director, Board and Committee Evaluations
   
   The Board believes that the Governance Committee should review the performance of incumbent directors prior to their re-election. The Board expects the Governance Committee to recommend appropriate action to effect changes in incumbent directors if, in the opinion of the Governance Committee after discussion with the Chairman of the Board and President, any director is not contributing to the work of the Board.
   
   The Board also believes that the Governance Committee should periodically review the Board’s performance and effectiveness as a body, including its corporate governance policies and practices, and that a similar review should be undertaken with respect to each of the Board’s committees. The assessment of the Board and each committee should address the body’s contribution as a whole and specifically review areas in which the Board or management believes a better contribution could be made. This assessment should also include issues of diversity, age and skills, all in the context of an assessment of the perceived needs of the Board or the relevant committee at that point in time. The Governance Committee will coordinate these assessments, which may consist of surveys and self-evaluations, and report to the Board the results of its analysis and any recommendations following each such review. The Governance Committee shall coordinate such reviews at least annually.
    
9. Director Compensation
   
   The Board believes that the level of director compensation generally should be competitive with that paid to directors of other corporations of similar size and complexity. The President will report annually to the Governance Committee on the competitive status of Board compensation. The Governance Committee is responsible for making recommendations to the full Board, which approves director compensation and benefits programs.

D. COMMITTEES OF THE BOARD

1. Number and Types of Committees
   
   The Board believes that committees should be created and disbanded depending on the particular interests of the Board, issues facing the Association and legal requirements. The current “standing” committees of the Board that is, committees expected to operate over an extended period are the Finance Committee, the Benefits Committee and the Governance Committee. The Board also expects that the committee structure would be one of the matters considered by the Governance Committee from time to time as part of its review of overall Board effectiveness.
    

2. Assignment and Rotation of Committee Members
   
   The Board believes that the Governance Committee should recommend committee appointments for approval of the full Board. The Board expects that assignments would be made within the following guidelines: assignments may be rotated periodically, though not necessarily within any specified time frame; the Finance Committee and the Governance Committees should be comprised solely of independent directors.
    

3. Frequency of Committee Meetings
   
   It is the responsibility of committee chairs, in consultation with committee members, to determine the frequency and length of committee meetings.
    

4. Committee Agenda
   
   Committee chairs, in consultation with appropriate members of management and committee members, should determine committee agenda.
    

5. Committee Reports
   
   Reports of committee meetings are submitted to the full Board following each committee meeting. Committee chairs are offered the opportunity to comment on committee activities at each Board meeting.

E. OTHER ASSOCIATION GOVERNANCE ISSUES

1. Communications with the Public
   
   The President is responsible for establishing effective communications with the Association’s stakeholder groups, including members, customers, employees, communities, suppliers, creditors, governments and corporate partners. It is the policy of the Association that management speaks for the Association, and the Chairman of the Board speaks for the Board. This policy does not preclude independent directors from meeting with stakeholder groups, but it is suggested that any such meetings be with management present.
    

2. Periodic Review
   
   These principles shall be reviewed by the Governance Committee from time to time (not less than annually).