Tell us who you are to read, explore, and contribute. Your identity is logged with provenance. Open access. Governed record.

CANONIC Foundation

Conflict of Interest Policy — CANONIC Foundation, Inc.

CONFLICT OF INTEREST POLICY — CANONIC FOUNDATION, INC.

inherits: hadleylab-canonic/CHARTER/BOARD privacy: VAULT

CONFLICT OF INTEREST POLICY OF CANONIC FOUNDATION, INC.

ARTICLE I — PURPOSE

The purpose of this Conflict of Interest Policy is to protect CANONIC Foundation, Inc. (the “Corporation”) when it is contemplating entering into a transaction or arrangement that might benefit the private interest of a director or officer of the Corporation or might result in a possible excess benefit transaction. This policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and charitable organizations.

ARTICLE II — DEFINITIONS

Section 2.1 — Interested Person. Any director, officer, or member of a committee with Board-delegated powers who has a direct or indirect financial interest, as defined below, is an “Interested Person.”

Section 2.2 — Financial Interest. A person has a financial interest if the person has, directly or indirectly, through business, investment, or family:

(a) An ownership or investment interest in any entity with which the Corporation has a transaction or arrangement;

(b) A compensation arrangement with the Corporation or with any entity or individual with which the Corporation has a transaction or arrangement; or

(c) A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Corporation is negotiating a transaction or arrangement.

Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial.

A financial interest is not necessarily a conflict of interest. A person who has a financial interest may have a conflict of interest only if the Board or appropriate committee decides that a conflict of interest exists, in accordance with this policy.

ARTICLE III — PROCEDURES

Section 3.1 — Duty to Disclose. In connection with any actual or possible conflict of interest, an Interested Person must disclose the existence of the financial interest and be given the opportunity to disclose all material facts to the Board or committee considering the proposed transaction or arrangement.

Section 3.2 — Determining Whether a Conflict of Interest Exists. After disclosure of the financial interest and all material facts, and after any discussion with the Interested Person, the Interested Person shall leave the meeting while the remaining Board or committee members discuss and vote on whether a conflict of interest exists.

Section 3.3 — Procedures for Addressing the Conflict of Interest.

(a) An Interested Person may make a presentation to the Board or committee, but after the presentation, the Interested Person shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest.

(b) The Chair or committee chair shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.

(c) After exercising due diligence, the Board or committee shall determine whether the Corporation can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest.

(d) If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the Board or committee shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the Corporation’s best interest, for its own benefit, and whether it is fair and reasonable. In conformity with the above determination, the Board or committee shall make its decision as to whether to enter into the transaction or arrangement.

Section 3.4 — Violations of the Policy.

(a) If the Board or committee has reasonable cause to believe a person has failed to disclose an actual or possible conflict of interest, it shall inform the person of the basis for such belief and afford the person an opportunity to explain the alleged failure to disclose.

(b) If, after hearing the person’s response and after making further investigation as warranted by the circumstances, the Board or committee determines that the person has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action, up to and including removal from the Board.

ARTICLE IV — RECORDS OF PROCEEDINGS

Section 4.1 — Minutes. The minutes of the Board and all committees with Board-delegated powers shall contain:

(a) The names of the persons who disclosed or otherwise were found to have a financial interest in connection with an actual or possible conflict of interest, the nature of the financial interest, any action taken to determine whether a conflict of interest was present, and the Board’s or committee’s decision as to whether a conflict of interest in fact existed.

(b) The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings.

ARTICLE V — COMPENSATION

Section 5.1 — Compensation Matters. A voting member of the Board who receives compensation, directly or indirectly, from the Corporation for services is precluded from voting on matters pertaining to that member’s compensation.

Section 5.2 — Compensation Committee. A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Corporation for services is precluded from voting on matters pertaining to that member’s compensation.

Section 5.3 — Information. No voting member of the Board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Corporation, either individually or collectively, is prohibited from providing information to any committee regarding compensation.

ARTICLE VI — ANNUAL STATEMENTS

Section 6.1 — Annual Disclosure. Each director, officer, and member of a committee with Board-delegated powers shall annually sign a statement which affirms such person:

(a) Has received a copy of this Conflict of Interest Policy;

(b) Has read and understands the policy;

(c) Has agreed to comply with the policy; and

(d) Understands that the Corporation is charitable and in order to maintain its federal tax exemption it must engage primarily in activities which accomplish one or more of its tax-exempt purposes.

ARTICLE VII — PERIODIC REVIEWS

Section 7.1 — Reviews. To ensure the Corporation operates in a manner consistent with charitable purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted. The periodic reviews shall, at a minimum, include the following subjects:

(a) Whether compensation arrangements and benefits are reasonable, based on competent survey information, and the result of arm’s length bargaining.

(b) Whether partnerships, joint ventures, and arrangements with management organizations conform to the Corporation’s written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes, and do not result in inurement, impermissible private benefit, or an excess benefit transaction.

ARTICLE VIII — USE OF OUTSIDE EXPERTS

Section 8.1 — Outside Experts. When conducting the periodic reviews described in Article VII, the Corporation may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the Board of its responsibility for ensuring periodic reviews are conducted.

ANNUAL CONFLICT OF INTEREST DISCLOSURE FORM

I, the undersigned, a director / officer / committee member of CANONIC Foundation, Inc., hereby:

  1. Acknowledge that I have received and read the Conflict of Interest Policy.
  2. Agree to comply with the policy.
  3. Understand that the Corporation is a tax-exempt organization and must engage primarily in activities that accomplish its tax-exempt purposes.

Disclosures (list any financial interests, positions, or relationships that could give rise to a conflict):

_________________________________________________________________

_________________________________________________________________

_________________________________________________________________

No conflicts to disclose: ☐

_______________________________     _______________
Signature                           Date

_______________________________
Printed Name

NOTES FOR DAVID

  1. IRS Form 1023 compliance: This policy follows the IRS sample COI policy from the Form 1023 instructions (Appendix A). The IRS expects to see this policy adopted at the organizational meeting.

  2. Annual disclosure form: Included at the end — each director signs annually. Dexter, Fatima, and David (if voting) all sign at formation.

  3. Compensation (Article V): Relevant if any directors receive compensation for services. Currently no director compensation is planned, but the policy covers it if that changes.

  4. Adjust as you see fit — this is the standard template. If you want stricter provisions (e.g., cooling-off periods, related-party transaction dollar thresholds), mark them up.

COI-POLICY | BOARD | CHARTER

CANONIC ∩ FOUNDATION
TALK AUTO