FOUNDATION FOR FOCUSED ULTRASOUND RESEARCH
Functioning as an UNINCORPORATED ASSOCIATION
CONFLICT OF INTEREST POLICY
Section 1.Purpose. The purpose of the conflicts of interest policy is to protect the Association's private interest of a director of the Association. This policy is intended to supplement, but not replace any applicable state laws governing conflicts of interest applicable to nonprofit and charitable associations.
Section 2. Definitions.
(a) Interested Person. And member of the Board of Directors, or individual of a committee who has a direct or indirect financial interest, as defined below, is an interested person.
(b) Financial Interest. A person has a financial interest if the person has, directly or indirectly, through business, investment or family--
(1) an ownership or investment interest in any entity with which the Association has a transaction or arrangement, or, a compensation arrangement with the Association or with any entity or individual with which the Association has a transaction or arrangement, or
(2) a compensation arrangement with the Association or with any entity or individual with which the Association has a transaction or arrangement, or
(3) a potential ownership or investment or interest in, or compensation arrangement with any entity or individual with which the Association is negotiating a transaction or arrangement.
Compensation includes direct and indirect remuneration as well as gifts or favors that are substantial in nature.
A financial interest is not necessarily a conflict of interest. Under Section 3, part (b), a person who has a financial interest may have conflict of interest only if the appropriate board or committee decides that a conflict of interest exists.
Section 3. Procedures
(a) Duty to Disclose. In connection with any actual or possible conflicts or interest, an interested person must disclose the existence of his or her financial interest and must be given the opportunity to disclose all material facts to the directors and committee persons with board powers considering the proposed transaction or arrangement.
(b) 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, he/she shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement that results in the conflict of interest.
(c) Procedures of Addressing the Conflict of Interest.
(1) An interested person may make a presentation at a Board or Committee meeting, but after such presentation, he/she shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement that results in the conflict of interest.
(2) The Director or Committee Chairperson shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
(3) After exercising due diligence, the Board of Directors or Committee Chairperson shall determine whether the Association can obtain a more advantageous transaction or arrangement with reasonable efforts from a person or entity that would not give rise to a conflict of interest.
(4) If a more advantageous transaction or arrangement is not reasonably attainable under circumstances that would not give rise to a conflict of interest, the Board of Directors shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the Association’s best interest and for its own benefit and whether the transaction is fair and reasonable to the Association and shall make its decision as to whether to enter into the transaction or arrangement in conformity with such determination.
(d) Violations of the Conflicts of Interest Policy.
(1) If the Board of Directors has reasonable cause to believe that an individual has failed to disclose actual or possible conflicts of interest, it shall inform the individual of the basis for such belief and afford the individual an opportunity to explain the alleged failure to disclose.
(2) If, after hearing the response of the individual and making such further investigations as may be warranted in the circumstances, the Board of Directors determines that the individual has in fact failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.
Section 4. Records of Proceedings. The minutes of the Board of Directors 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 the discussions and votes relating to the transaction or arrangement, and a record of any votes taken in connection therewith.
Section 5. Compensation.
(a) A member of the Board of Directors who receives compensation, directly or indirectly, from the Association for services is precluded from voting on matters pertaining to that director’s compensation.
(b) An individual of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Association for services is precluded from voting on matters pertaining to that individual’s compensation.
(c) The founder of the Association who receives compensation, directly or indirectly, from the Association is precluded from voting on matters pertaining to the founder’s compensation, or setting his or her compensation amount.
