Article I
Purpose

The purpose of this Conflict of Interest Policy is to protect the interests of Jupiter 360 Foundation, a California nonprofit public benefit corporation (the “Organization”), when it is contemplating entering into a transaction or arrangement that might benefit the private interests of an officer, director, or key employee of the Organization 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 conflicts of interest applicable to nonprofit and tax-exempt organizations.

Article II
Definitions

For purposes of this Conflict of Interest Policy, the following terms are defined as follows:

1. Interested Person

Any director, officer, member of a committee that has been delegated with governing powers by the governing board, or key employee, who has a direct or indirect financial interest, as defined below, is an interested person.

2. Financial Interest

A person has a financial interest if the person has, directly or indirectly, through business, investment, or family, as defined below:

• An ownership or investment interest in any entity with which the Organization has or engages in a transaction or arrangement;
• A compensation arrangement with the Organization or with any entity or individual with which the Organization has or engages in a transaction or arrangement; 
• A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Organization is negotiating a transaction or arrangement; or
• Any other material financial interest or economic benefit that would be subject to laws regarding self-dealing under Section 5233 of the California Nonprofit Public Benefit Corporation Law.

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. Under Article III, Section 2, the existence of a financial interest may cause the Organization to have a conflict of interest only if the appropriate governing board (the “Board”) or committee with Board-delegated powers (a “Committee”) decides that a conflict of interest exists.

3. Family

A person’s spouse or domestic partner, ancestors (e.g., parents, grandparents), children (whether natural or adopted), grandchildren, great-grandchildren, siblings (whether by the whole or half blood), and the spouses or domestic partners of such person’s children, grandchildren, great-grandchildren, and siblings.

4. Key Employee

An employee of the Organization (other than an officer, director, or trustee) who meets all three of the following tests, applied in the following order:

• $150,000.00 Test: Receives reportable compensation from the Organization and all related organizations (as such term is defined for the purposes of IRS Form 990) in excess of $150,000.00 for the calendar year ending with or within the Organization’s tax year. 
• Responsibility Test:
  1. Has responsibilities, powers, or influence over the Organization as a whole that are similar to those of officers, directors, or trustees;
  2. Manages a discrete segment or activity of the Organization that represents ten percent (10%) or more of the activities, assets, income, or expenses of the Organization, as compared to the Organization as a whole; or
  3. Has or shares authority to control or determine ten percent (10%) or more of the Organization’s capital expenditures, operating budget, or compensation for employees.
• Top 20 Test: Is one of the twenty (20) employees (that satisfy the above two tests) with the highest reportable compensation from the Organization and related organizations (as such term is defined for the purposes of IRS Form 990) for the calendar year ending with or within the Organization’s tax year.

5. Officer

Any officer of the Organization, including, but not limited to, the president, chair of the board, chief executive officer, chief operating officer, chief financial officer, treasurer, secretary, executive director, and vice president, or any person with the responsibilities of any of these offices (whether or not such person is an officer of the Organization under the Organization’s Bylaws and/or the California Corporations Code).

Article III
Procedures

1. Duty to Disclose

In connection with any proposed or existing transaction to which the Organization is a party involving an actual or possible conflict of interest due to the existence of a financial interest, an interested person must disclose the existence of the financial interest and be given the opportunity to disclose all material facts to the members of the Board and members of any Committee considering the proposed or existing transaction or arrangement. The interested person shall make such disclosure in a timely manner upon learning of the financial interest associated with any transaction or arrangement involving the Organization, whether existing or proposed.

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 Board or Committee meeting while the issue of whether a conflict of interest that prevents the Organization from proceeding with a transaction or requires it to take certain other steps exists is discussed and voted upon. The remaining Board or Committee members shall decide if such a conflict of interest exists and how the Organization shall proceed.

3. Procedures for Addressing the Conflict of Interest

The Board or Committee shall follow the following procedures in order to determine whether to enter into a transaction or arrangement involving a possible or actual financial interest and, if the Organization does enter into such transaction or arrangement, to ensure that the terms of the transaction or arrangement are fair and reasonable as to the Organization.

• An interested person may make a presentation at the Board or Committee meeting, 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 for the Organization.
• The chair of the Board or Committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed or existing transaction or arrangement.
• The Board or Committee shall exercise reasonable due diligence in gathering sufficient information about the proposed or existing transaction or arrangement, the interested person’s financial interest, and possible alternatives (e.g., comparability data) to be able to determine the fairness and reasonableness of the transaction or arrangement to the Organization.
• The Board shall consider and in good faith determine whether the Organization 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.
• If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the Board shall determine by a vote of a majority of the directors then in office without counting the vote of the interested director or directors whether the transaction or arrangement is in the Organization’s best interest, for its own benefit, and whether it will be fair and reasonable as to the Organization at the time the Organization is to enter into the transaction or arrangement. In conformity with the above determination, the Board shall make its decision as to whether to enter into the transaction or arrangement.
• If it is not reasonably practicable to obtain approval of the Board consistent with the standards set forth in subsections d and e (the “Standards”) prior to entering into the transaction or arrangement, a Committee shall make the determination of whether to enter into such transaction or arrangement in a manner consistent with the Standards; and the Board shall subsequently consider in good faith whether (i) it was not reasonably practicable to obtain approval of the Board prior to entering into the transaction or arrangement, and (ii) the Committee approved the transaction or arrangement in a manner consistent with the Standards. If the Board determines that the conditions of (i) and (ii) were met, it may, by a vote of the majority of the directors then in office without counting the vote of the interested director or directors, ratify the transaction or arrangement.

4. Violations of the Conflict of Interest Policy

• If the Board or Committee has reasonable cause to believe that one of its members has failed to disclose an actual or possible financial interest, it shall inform the member of the basis for such belief and afford the member an opportunity to explain the alleged failure to disclose.
• If, after hearing the member’s response and after making further investigation as warranted by the circumstances, the Board or Committee determines the member has failed to disclose an actual or possible financial interest, it shall take appropriate disciplinary and corrective action, which may include, but is not limited to, removal from any Committee and/or the Board, in compliance with the terms of the Bylaws of the Organization.

Article IV
Records of Proceedings

The minutes of meetings of the Board and all Committees shall contain:

1. 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.
2. The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the extent to which interested persons were excluded from the deliberations, the content of the discussion (including any alternatives to the proposed transaction or arrangement and comparability data or other information reviewed in connection with the discussion), and a record of any votes taken in connection with the proceedings.

The minutes must be prepared by the later of (i) the next Board or Committee meeting, respectively, or (ii) sixty (60) days after the final action of the Board or Committee with respect to the transaction or arrangement.

Article V
Compensation

1. A director or Committee member who receives compensation, directly or indirectly, from the Organization for services is precluded from voting on matters pertaining to that director’s or member’s compensation.
2. No director or Committee member who receives compensation, directly or indirectly, from the Organization, either individually or collectively, is prohibited from providing information to the Board or any Committee regarding compensation.

Article VI
Annual Affirmation and Disclosures

Each director, officer, Committee member, and key employee shall annually sign a statement which:

1. Affirms that the person has received a copy of, has read and understood, and has agreed to comply with this Conflict of Interest Policy; and
2. Discloses that person’s interests that could reasonably give rise to actual or potential conflicts of interest.

In addition, each such person shall timely submit a revised disclosure statement at any time when there is a change to the information reported by such person on the most recently submitted statement. All such statements by directors, officers, key employees, and Committee members shall be filed with the minutes of the Board or Committee.

Article VII
Periodic Reviews

To ensure the Organization operates in a manner consistent with its exempt purposes and tax-exempt status, periodic reviews of this Conflict of Interest Policy, its administration, and its enforcement shall be conducted. 

Article VIII
Use of Outside Experts

When conducting the periodic reviews as provided for in Article VII, the Organization may, but need not, use outside advisors. If outside advisors are used, their use shall not relieve the Board of its responsibility for ensuring periodic reviews are conducted.