Common use of Foundation Governance Clause in Contracts

Foundation Governance. 1. Unlike the University, the Foundation is not a public agency. The Foundation exists as a separate legal entity from the University and is not subject to the University’s control. The Foundation is a Kentucky nonprofit corporation that has been recognized by the Internal Revenue Service as a tax-exempt charity under Section 501(c)(3) of the Internal Revenue Code, as amended (the “Code”). 2. The Foundation’s Board of Directors is responsible for overseeing the Foundation’s operations, including control and management of its assets and prudent management of all gifts made for the benefit of the University, whether endowed or current use gifts, consistent with donor intent. This oversight is governed by a comprehensive set of articles of incorporation, bylaws, committee charters and policies that clearly address the fiduciary responsibilities of the Board of Directors, including requirements that individual board members act in good faith, on an informed basis, in a manner consistent with the Foundation’s fiduciary duties and the Foundation’s best interests, and in furtherance of the Foundation’s commitment to the University. 3. The Foundation shall establish, maintain and enforce policies to identify and manage potential conflicts of interest among its board members and staff. Such policies shall be reviewed on a regular basis and strictly enforced. While “direct investments” by the Foundation are prohibited (see III. B.4. below), the Foundation’s conflict of interest policies will prohibit any investment by the Foundation in a business in which any member of the University’s Board of Trustees or Foundation’s Board of Directors or any executive level employee or officer of the University or the Foundation have an ownership, employment, consulting or other financial relationship. 4. The Chair of the Foundation’s Board of Directors shall be a member of the Foundation’s Board of Directors, but shall not be the President of the University of Louisville. 5. The Foundation is responsible for employing, compensating, and evaluating all of its employees, including the Foundation’s top executive. As it relates to compensation for executive officers of the Foundation, the Foundation’s Board of Directors shall only act upon the recommendation of its Compensation Committee. 6. No officer or employee of the Foundation (including the Foundation’s chief executive), shall serve simultaneously as an officer of the University, without the prior approval of the University’s Board of Trustees and the Foundation’s Board of Directors. 7. The Foundation’s Board of Directors may choose to form an executive committee, which committee would have only such authority as is delegated in writing pursuant to a resolution approved by the affirmative vote of not less than 75% of the voting members of the Foundation’s Board of Directors. The Executive Committee, if formed, shall include at least one Trustee Director.

Foundation Governance. 1. Unlike the University, the Foundation is not a public agency. The Foundation exists as a separate legal entity from the University and is not subject to the University’s control. The Foundation is a Kentucky nonprofit corporation that has been recognized by the Internal Revenue Service as a tax-exempt charity under Section 501(c)(3) of the Internal Revenue Code, as amended (the “Code”). 2. The Foundation’s Board of Directors is responsible for overseeing the Foundation’s operations, including control and management of its assets and prudent management of all gifts made for the benefit of the University, whether endowed or current use gifts, University consistent with donor intent. This oversight is governed by a comprehensive set of articles of incorporation, bylaws, committee charters and policies that clearly address the fiduciary responsibilities of the Board of Directors, including requirements that individual board members act in good faith, on an informed basis, and in a manner consistent with the Foundation’s fiduciary duties and the Foundation’s best interests, and in furtherance of the Foundation’s commitment to the University. 3. The Foundation shall establish, maintain and enforce enforces policies to identify and manage potential conflicts of interest among its board members and staff. Such policies shall be reviewed on a regular basis and strictly enforced. While “direct investments” by the Foundation are prohibited (see III. B.4A.3. below), the Foundation’s conflict of interest policies will prohibit any investment by the Foundation in a business in which any member of the University’s Board of Trustees or Foundation’s Board of Directors or any executive level employee or officer of the University or the Foundation have an ownership, employment, consulting or other financial relationship. 4. The Chair of the Foundation’s Board of Directors shall be a member of the Foundation’s Board of Directors, but shall not be the President of the University of Louisville. 5. The To the extent it has employees, the Foundation is responsible for employing, compensating, and evaluating all of its employees, including the Foundation’s top executive. As it relates to compensation for executive officers Currently, the Foundation contracts with the University of the Louisville Foundation, the Foundation’s Board of Directors shall only act upon the recommendation of its Compensation CommitteeInc. for management services. 6. No officer or employee of the Foundation (including the Foundation’s chief executive), shall serve simultaneously as an officer of the University, without the prior approval of the University’s Board of Trustees and the Foundation’s Board of Directors. 7. The Foundation’s Board of Directors may choose to form an executive committee, which committee would have only such authority as is delegated in writing pursuant to a resolution approved by the affirmative vote of not less than 75% of the voting members of the Foundation’s Board of Directors. The Executive Committee, if formed, shall include at least one Trustee Director.