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Clarifies the scope of Related Person Transactions

Open zenzen-sol opened this issue 3 years ago • 2 comments

The language below raises a few questions:

#§(b)(1)(vi)

...any material transaction, or any proposed material transaction, in which the 
Initial Development Team is a participant and in which any Related Person had 
or will have a direct or indirect material interest.

  1. What if some members of the IDT are participating in the transaction, but others are not?
  2. What if a member of the IDT is the only Related Person participating, but doesn't have a material interest in the transaction?
  3. What if a non-IDT Related Person is the only participant in the transaction?

This PR proposes the following revisions to clarify:

#§(b)(1)(vi)

...any material transaction, or any proposed material transaction, in which one 
or more Related Persons participate and had or will have a direct or indirect 
material interest.


#§(k)(3)

Related person means any individual member of the Initial Development Team, any 
director or advisor to the Initial Development Team, and any immediate family 
member of such persons.

...which would answer the questions above as follows:

  1. If even one member of the IDT is participating, the transaction should be in-scope for the disclosure requirement.
  2. In order to trigger the disclosure requirement, both participation by at least one Related Person AND a material interest in the transaction are required.
  3. If a Related Person who isn't on the IDT is the only participant—e.g., an advisor or an immediate family member—the transaction should be in-scope for the disclosure requirement.

zenzen-sol avatar Apr 17 '21 13:04 zenzen-sol

Related to #9 and #10

zenzen-sol avatar Apr 18 '21 02:04 zenzen-sol

A solid improvement.

paulbarclay avatar Apr 19 '21 14:04 paulbarclay