The Dash Foundation, Inc.
Conflict of Interest Policy

Effective as of September

 

Article I – Purpose
Article II – Definitions
Article III – Procedures
Article IV – Records of Proceedings
Article V – Compensation
Article VI – Annual Statements
Article VII – Periodic Reviews
Article
VIII – Use of Outside Advisors

Article I
Purpose

The purpose of this conflict of interest policy is to protect the interests of The Dash Foundation, Inc. (the “Corporation”) when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director of the Corporation.  This policy is intended to supplement any state or federal laws governing conflicts of interest applicable to nonprofit organizations.

Article II
Definitions

  1. A “conflicting interest” is the interest an officer, director or committee member has with respect to a transaction effected or proposed to be effected by the Corporation if:
    1. The officer, director or committee member knows at the time of commitment that she or a related person:
      1. Is a party to the transaction; or
      2. Has a beneficial financial interest in or so closely linked to the transaction, of such financial significance to the officer or director or a related person, that the interest would reasonably be expected to exert an influence on the officer’s or director’s judgment if she were called on to vote on the transaction; or
    2. The transaction is brought before, or is of such character and significance to the Corporation that it would normally be brought before, the board of directors for action, and the officer, director or committee member knows at the time of commitment that any of the following persons or entities is a party to the transaction, or has a beneficial financial interest in or so closely linked to the transaction, of such financial significance to the person or entity, that the interest would reasonably be expected to exert an influence on the officer’s, director’s or committee member’s judgment if she were called on to vote on the transaction:
      1. An entity other than the Corporation, of which the officer, director or committee member is a director, general partner, agent or employee;
      2. A person that controls one or more of the entities specified in (i), or an entity that is controlled by or under common control with one or more of the entities specified in (i);
      3. The officer’s, director’s or committee member’s general partner, principal or employer.
  2. A “conflict of interest transaction” is a transaction effected or proposed to be effected by the Corporation, including the sale, lease or exchange of property to or from related persons and the Corporation, the lending or borrowing of monies to or from related persons by the Corporation and the payment of compensation by the Corporation for services rendered by related persons, with respect to which an officer, director or committee member has a conflicting interest.
  3. An “interested person” is, with respect to a possible conflict of interest transaction, the officer, director or committee member that may have a conflicting interest with respect to the transaction.
  4. A “qualified director” is, with respect to a possible conflict of interest transaction, any director that does not have either:
    1. A conflicting interest with respect to the transaction; or
    2. A familial, financial, professional or employment relationship with an interested person that would reasonably be expected to exert an influence on the director’s judgment when voting on the transaction.
  5. A “related person” is:
    1. The spouse, or a parent or sibling of the spouse, of an officer, director or committee member;
    2. A child, grandchild, sibling or parent, or spouse of a child, grandchild, sibling or parent, of an officer, director or committee member;
    3. An individual having the same home as an officer, director or committee member;
    4. A trust or estate of which an individual specified in (A), (B) or (C) is a substantial beneficiary;
    5. A trust, estate, incompetent, conservatee or minor of which an officer, director or committee member is a fiduciary.
  6. The “time of commitment” with respect to a transaction is the time when the transaction is consummated, or, if entered into pursuant to a contract, the time when the Corporation becomes contractually obligated such that its unilateral withdrawal from the transaction would entail significant loss, liability or other damage.

 

Article III
Procedures

  1. Duty to Disclose
    1. In connection with any actual or possible conflicting interest, an interested person must disclose:
      1. The existence and nature of the conflicting interest; and
      2. All facts known to the interested person with respect to the subject matter of the transaction that an ordinarily prudent person would reasonably believe to be material to a judgment regarding whether or not to proceed with the transaction.
    2. If neither the interested person nor a related person is a party to an actual or possible conflict of interest transaction, and the interested person has a legal or professional duty, or a duty of confidentiality to another individual, with respect to information relating to the transaction such that the interested person may not disclose the facts described in (1)(A)(ii), the interested person must:
      1. Disclose to the directors voting on the transaction the existence and nature of the conflicting interest; and
      2. Before they vote on the transaction, inform them of the character and limitations imposed by that duty.
  2. Determining whether a Conflicting Interest Exists
    After disclosure of the possible conflicting interest and all known material facts, and after any discussion with the interested person, the interested person shall leave the board meeting while the remaining directors decide whether or not a conflicting interest exists.
  3. Procedures for Addressing the Conflicting Interest
    1. An interested person may make a presentation at a board meeting, but he shall leave the meeting during the discussion of and vote on the conflict of interest transaction.
    2. The Chairman of the Board shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the conflict of interest transaction.
    3. After exercising due diligence, the board of directors shall determine whether or not the Corporation can enter into a more advantageous transaction or arrangement with a different person or entity that would not give rise to a conflicting interest.
    4. If a more advantageous transaction or arrangement is not reasonably possible, the Corporation shall enter into the conflict of interest transaction if a majority of the qualified directors, but at least two, that vote on the transaction decide that it is in the Corporation’s best interest, for its own benefit and fair and reasonable.
    5. A majority, but at least two, of the qualified directors on the board of directors shall constitute a quorum for the purposes of this article.
  4. Violations of the Conflict of Interest Policy
    1. If the board of directors has reasonable cause to believe an interested person has failed to disclose an actual or possible conflicting interest, it shall inform the interested person of the basis for this belief and afford him an opportunity to explain his alleged failure to disclose.
    2. If the board of directors concludes that the interested person failed to disclose an actual or possible conflicting interest, it shall take appropriate disciplinary and corrective action.

 

Article IV
Records of Proceedings

The minutes of the board of directors and all committees with board delegated powers shall contain: (A) the names of all interested persons that disclosed or were found to have a conflicting interest; (B) the nature of the conflicting interest; (C) any action taken to determine whether or not a conflicting interest existed; (D) the board of directors’ decision as to whether or not a conflicting interest existed; (E) the names of the qualified directors that were present for discussions and votes relating to the conflict of interest transaction; (F) the content of the discussions, including any alternatives to the conflict of interest transaction; and (G) a record of any votes taken in connection with the proceedings.

Article V
Compensation

  1. A director that is compensated directly or indirectly by the Corporation for services rendered is precluded from voting on matters pertaining to her compensation.
  2. A member of any committee whose jurisdiction includes compensation matters, that is compensated directly or indirectly by the Corporation for services rendered, is precluded from voting on matters pertaining to her compensation.
  3. No director or member of any committee whose jurisdiction includes compensation matters, that is compensated directly or indirectly by the Corporation for services rendered, is prohibited from providing information to any committee regarding compensation.

 

Article VI
Annual Statements

Each officer, director and member of any committee with board delegated powers shall annually sign a statement affirming that he: (A) has received a copy of this conflict of interest policy; (B) has read, understands and agrees to comply with the policy; and (C) understands that the Corporation is a 501(c)(6) organization that must engage primarily in activities that further one or more of its tax-exempt purposes in order to maintain its federal tax exemption.

Article VII
Periodic Reviews

  1. To ensure that the Corporation operates in a manner consistent with its purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted.
  2. The periodic reviews shall, at a minimum, cover the following subjects:
    1. Whether compensation arrangements and benefits are reasonable, based on reliable survey information and the result of arm’s length bargaining;
    2. 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 the Corporation’s purposes and do not result in inurement or an impermissible private benefit.

 

Article VIII
Use of Outside Advisors

The Corporation may use outside advisors when conducting a periodic review.  If outside advisors are used, their use shall not relieve the board of directors of its responsibility for ensuring that periodic reviews are conducted.       I affirm that I have received a copy of this conflict of interest policy, have read, understand and agree to comply with the policy and understand that the Corporation is a 501(c)(6) organization that must engage primarily in activities that further one or more of its tax-exempt purposes in order to maintain its federal tax exemption.