Related Conflict of Interest Policies

Title : Standards for Determining Independence of Members of Board of Directors Number : 742, Version : 5

organization within the meaning of Section 509(f)(3) of the Internal Revenue Code of the relevant organization. III. Policy: A. No member of the Banner Health Board of Directors qualifies as an independent director if the Audit Committee determines that : 1. The director has any relationship with Banner (either directly or as an Interested Person of an organization that has a relationship with Banner) that would interfere with the director’s exercise of independent judgment in carrying out the responsibilities of a director, taking into account the materiality of the relationship to Banner, to the director and to the organization with which the director is affiliated, and 2. The director is disqualified from being independent under any of the criteria specified in III.B below. B. A director shall not qualify as an independent director if: 1. The director is, or was during the immediately preceding calendar year, an employee of Banner; or 2. The director received total compensation or other payments exceeding $10,000 during either the current or the immediately preceding calendar year as an independent contractor, other than reimbursement for reasonable expenses pursuant to Banner’s business expense reimbursement policy or receipt of reasonable director’s fees; or 3. The director or any Interested Person related to the director has received, or made, a loan to Banner that is outstanding or was outstanding as of the end of the immediately preceding calendar year; or 4. The director has been, or is then involved in any excess benefit transaction with Banner during the current or the immediately preceding calendar year; or 5. The director, any Family Member, or any Interested Person related to the director has received a grant or other assistance (including provision of services) from Banner; or 6. Any Family Member of the director has received total compensation or other payments exceeding $10,000 during either the current or the immediately preceding calendar year; or 7. The director, any Interested Person related to the director, or any combination thereof, have engaged in a single Business Transaction in which the payments exceeded $10,000 during either the current year or the immediately preceding calendar year; or 8. The director, any Interested Person related to the director, or any combination thereof have engaged in one or more Business Transactions in which the payments during either the current year or the immediately preceding calendar year exceeded $100,0000; or 9. The director or any Family Member of the director was involved in any transaction with Banner during the current or immediately preceding calendar year that would be required to be reported on Schedule L to Form 990 for Banner (or that would be reportable by any Related Organization of Banner if such Related Organization were required to file a Schedule L). C. Employment of a director by Banner as an interim President/CEO or other Key Employee, and the compensation received for such service, shall not disqualify a director from being considered independent from and after the beginning of the calendar year following the end of such employment.

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