Arizona Laws 10-3864. Conflict of interest policy; exceptions
A. The board of directors of a corporation shall adopt a policy regarding transactions between the corporation and interested persons, including the sale, lease or exchange of property to or from interested persons and the corporation, the lending or borrowing of monies to or from interested persons by the corporation or the payment of compensation by the corporation for services provided by interested persons. For the purposes of this subsection, "interested person" means an officer or director of a corporation or any other corporation, firm, association or entity in which an officer or director of a corporation is a member, officer or director or has a financial interest.
Terms Used In Arizona Laws 10-3864
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Board of directors: means the group of persons vested with the management of the affairs of the corporation irrespective of the name by which the group is designated and includes the governing body or bodies of a water users' association if the articles of incorporation of the water users' association provide for a governing body or bodies denominated other than as a board of directors. See Arizona Laws 10-140
- Contract: A legal written agreement that becomes binding when signed.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Entity: includes a corporation, foreign corporation, not for profit corporation, profit and not for profit unincorporated association, nonprofit corporation, close corporation, corporation sole or limited liability company, a professional corporation, association or limited liability company, a business trust, estate, partnership, registered limited liability partnership, trust or joint venture, two or more persons having a joint or common economic interest, any person other than an individual and a state, the United States and a foreign government. See Arizona Laws 10-140
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
- Foreign corporation: means a corporation for profit that is incorporated under a law other than the law of this state. See Arizona Laws 10-140
- including: means not limited to and is not a term of exclusion. See Arizona Laws 1-215
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Member: means , without regard to what a person is called in the articles of incorporation or bylaws, any person or persons who, pursuant to a provision of a corporation's articles of incorporation or bylaws, have the right to vote for the election of a director or directors. See Arizona Laws 10-3140
- Property: includes both real and personal property. See Arizona Laws 1-215
- United States: includes a district, authority, bureau, commission and department and any other agency of the United States. See Arizona Laws 10-140
- Vote: includes authorization by written ballot and written consent. See Arizona Laws 10-3140
B. The requirements of this section do not apply to any of the following:
1. A corporation that had assets at the end of its last fiscal year with a book value of less than ten million dollars, net of accumulated depreciation, or had gross receipts or revenues of less than two million dollars in its last fiscal year.
2. A corporation that offers goods or services only to members who are entitled to vote for its board of directors.
3. A corporation organized for religious purposes that does not have, as a substantial portion of its business, the offering of goods or services on a regular basis to the public for remuneration.
4. A corporation organized by or on behalf of the United States, this state, a political subdivision of this state or an agency or instrumentality of such a governmental entity.
5. A hospital, medical, dental or optometric service corporation licensed pursuant to Title 20, Chapter 4, Article 3.
C. For the purposes of subsection B, paragraph 3:
1. Goods and services include medical, hospital, dental or counseling or social services offered on a regular basis to the public for remuneration.
2. A corporation organized for religious purposes includes a corporation or foreign corporation that controls or is controlled directly or indirectly by a corporation or foreign corporation organized for religious purposes.
D. The exemption provided by subsection B, paragraph 4 does not apply to a corporation that provides services to or operates assets of the governmental entity pursuant to a lease or contract.