Adopted on July 6, 2021
© New York CannaBusiness Chamber of Commerce (2021) Page 1 of 5
Working together to grow the cannabis industry
Policy Regarding Conflicts-of-Interest and Disclosure of certain Interests
Article I: Purpose
(1) This conflict of interest policy is designed to help directors, officers, employees, independent contractors and volunteers of the New York Cannabusiness Chamber of Commerce (NYCBCC) – and all other agents and representatives of the organization – to identify situations that present potential conflicts-of-interest and to provide the organization with a procedure that, if observed, will allow it to enter into valid and binding arrangements and transactions even though one or more of its directors, officers, employees, independent contractors or volunteers – and/or even if one or more of its agents or representatives – has or may have a conflict-of-interest with respect to the arrangement or transaction.
(2) This policy is intended to supplement, but not replace, any applicable federal, state and/or local laws and/or regulations regarding conflicts-of-interest that apply to non-profit and/or charitable organizations. In the event there is an inconsistency between the requirements and procedures prescribed herein and those in federal, state and/or local laws and/or regulations, the applicable law(s) and/or regulation(s) shall control.
(3) This policy is also intended to identify “independent” directors – and to establish the requirement that each member of the NYCBCC’s Board of Directors sign an “Annual Statement” regarding this Conflict-of-Interest policy (Note: See Article VI herein for more details regarding that “Annual Statement”).
Article II: Definitions
(1) Interested person
A person who has a conflict-of-interest is referred to herein as an “interested person.” In this regard, any director, officer, or member of a committee with Board-delegated powers who has, as defined herein, a direct or indirect financial interest in an arrangement or transaction – and/or a potential arrangement or transaction – that involves the NYCBCC is an interested person.
(2) Compensation
Adopted on July 6, 2021
© New York CannaBusiness Chamber of Commerce (2021) Page 2 of 5
As used herein, the term compensation includes direct and indirect remuneration as well as gifts or favors that have a commercial value of more than One Hundred Fifty Dollars ($150.00) in the aggregate during any 12-month period of time.
(3) Financial Interest
A director, officer, employee, independent contractor or volunteer of the NYCBCC (or a family member of any of the foregoing) has a financial interest in an arrangement or transaction – and/or a potential arrangement or transaction – that involves the organization if the person, directly or indirectly, through business, investment, or family:
(a) Is a party to or otherwise involved in an arrangement or transaction – and/or a potential arrangement or transaction – concerning the NYCBCC’s acquisition of goods or services;
(b) Has a material financial interest in an arrangement or transaction – and/or a potential arrangement or transaction – between the NYCBCC and an entity in which the director, officer, employee, independent contractor or volunteer (or a family member of the foregoing) is an agent, associate, custodian, director, employee, guardian, officer, partner, personal representative, receiver, trustee or any other legal representative; and/or
(c) Is engaged in some capacity or has a material financial interest in a business or enterprise that competes with the NYCBCC.
A financial interest is not necessarily a conflict-of-interest. In this regard, a person who has a financial interest will have a conflict-of-interest only if the NYCBCC’s Board of Directors determines, in accordance with this policy, that such a conflict-of-interest exists.
Other situations may create the appearance of a conflict-of-interest – and/or present a duality of interests – in conjunction with a person who has influence over the activities or finances of the NYCBCC. In this regard, all such circumstances must be disclosed, in writing, to the NYCBCC’s Board of Directors. Thereafter, if/as appropriate, a decision will be made as to what course of action the NYCBCC and the affected individual(s) will take so that the best interests of the organization are not compromised by the personal interests of the affected individual(s).
(4) Entertainment, Gifts, Gratuities & Other Favors
Accepting entertainment, gifts, gratuities or other favors with a commercial value of more than One Hundred Fifty Dollars ($150.00) in the aggregate during any 12-month period of time from individuals or entities can also result in the creation of a conflict-of-interest or a duality of interest when the party providing the entertainment, gift, gratuity or other favor does so under circumstances where it might be inferred that such action was intended to influence – or possibly would influence – the interested person in the performance of her/his duties and/or obligations concerning the NYCBCC. This does not preclude the acceptance of entertainment, gifts, gratuities or other favors of nominal or insignificant value that are not related to any particular transaction or activity of the NYCBCC.
Adopted on July 6, 2021
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(5) Independent Director
A director shall be considered “independent” for the purposes of this policy if (s)he:
(a) Is not – and has not been for a period of at least three (3) years – an employee or independent contractor of the NYCBCC or any entity in which the NYCBCC has a financial interest;
(b) Does not directly or indirectly have a significant business relationship with the NYCBCC that might affect their independence in decision-making;
(c) Is not employed as an executive of another entity where any of the NYCBCC’s directors, officers, employees, independent contractors or volunteers serve on that entity’s Compensation Committee; and
(d) Does not have an immediate family member who is a director, officer, employee, independent contractor or volunteer of the NYCBCC or who holds a position that has a significant financial relationship with the NYCBCC.
Article III – Procedures
(1) Duty To Disclose
In connection with any actual or possible conflict-of-interest, an interested person has an obligation to disclose the existence of the financial interest – and must be given the opportunity to disclose and explain all the material facts regarding that financial interest – to the NYCBCC’s Board of Directors.
(2) Recusal of Self
Any director may recuse herself/himself at any time from involvement in any decision or discussion in which the director believes (s)he has – or may have – a conflict-of-interest, without going through the process for determining whether a conflict-of-interest exists and without disclosing what the potential conflict-of-interest may be.
(3) Determining Whether a Conflict-of-Interest Exists
After disclosure of the financial interest and all material facts – and after discussion with the interested person – (s)he must leave the Board of Directors meeting while the determination of a conflict-of-interest is discussed and voted upon. The remaining members of the NYCBCC’s Board of Directors will decide if a conflict-of-interest exists.
(4) Procedures for Addressing the Conflict-of-Interest
(a) An interested person may make a presentation at the Board of Directors meeting, but after the presentation, (s)he shall leave the meeting during the discussion of – and the vote on – the arrangement or transaction involving the possible conflict-of-interest;
(b) The Chair of the Board of Directors shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed arrangement or transaction;
(c) After exercising due diligence, the Board of Directors shall determine whether the NYCBCC can obtain, with reasonable efforts, a more advantageous arrangement or transaction from a person or entity that would not give rise to a conflict-of-interest; and
Adopted on July 6, 2021
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(d) If a more advantageous arrangement or transaction is not reasonably possible under circumstances not producing a conflict-of-interest, the Board of Directors shall determine, by a majority vote of the disinterested directors, whether the arrangement or transaction is in the NYCBCC’s best interest, for its own benefit, and whether it is fair and reasonable – and in accordance with that determination, it shall decide as to whether to enter into the arrangement or transaction.
(5) Violations of the Conflict-of-Interest Policy
(a) If the Board of Directors has reasonable cause to believe a member has failed to disclose an actual or possible conflict-of-interest, it shall inform the member of the basis for such belief – and allow the member an opportunity to explain the alleged failure to disclose.
(b) If, after hearing the member’s response and after making a further investigation as warranted by the circumstances, the Board of Directors determines the member has failed to disclose an actual or possible conflict-of-interest, it shall take appropriate action.
Article IV – Records of Proceedings
The Minutes of all meetings of the NYCBCC’s Board of Directors – and all meetings of all committees with board delegated powers – shall contain, at a minimum, the names of the persons who disclosed or otherwise were found to have a financial interest in connection with an arrangement or transaction – and/or a potential arrangement or transaction – involving the CannaBusiness Chamber of Commerce, the nature of the financial interest, any action taken to determine whether a conflict-of-interest was present, and the Board’s decision as to whether a conflict-of-interest in fact existed. In addition, those Minutes shall also include copies of any relevant documents concerning the financial interest – and the outcome of any vote of the Board that was taken with respect to the matter.
Article V – Compensation
(1) A voting member of the Board who receives compensation, directly or indirectly, from the NYCBCC for services is precluded from voting on matters pertaining to that member’s compensation.
(2) A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the NYCBCC for services is precluded from voting on matters pertaining to that member’s compensation.
(3) No voting member of the Board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the NYCBCC, either individually or collectively, is prohibited from providing information to any committee regarding compensation.
Article VI – Annual Statements & Periodic Monitoring
Adopted on July 6, 2021
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(1) Each director, officer, and member of a committee with Board-delegated powers shall annually sign a statement that affirms (s)he:
(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 NYCBCC is a non-profit organization that must engage primarily in activities that accomplish one or more of the purposes set forth in its Certificate-of-Incorporation.
(2) If at any time during the year, the information in a person’s Annual Statement changes materially, (s)he shall disclose such changes and revise her/his Annual Statement.
(3) The Board of Directors shall regularly and consistently monitor compliance with this policy by reviewing Annual Statements and taking such other actions as are necessary for effective oversight.
Article VII – Use of Outside Experts
When conducting the periodic monitoring as provided for in Article VI herein, the NYCBCC may, but need not, use outside experts. If outside experts are used, their use shall not relieve the Board of Directors of its responsibility for ensuring periodic reviews are conducted.
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