Conflict of Interest Policy

POLICY OVERVIEW

As a recipient of a Project for which financial assistance funding is sought or received from the U.S. Department of Energy, Zero Point Cryogenics Inc. (the “Company” or “ZPC”) is required to identify and mitigate any potential, actual, or perceived financial or organizational Conflict of Interest (“COI”) that might arise from work to be performed by Company under all such Projects.

Under DOE’s Interim COI Policy, the Company must certify that it: (1) has in effect an up-to-date, written, and enforced administrative process to identify and manage COI with respect to all Projects for which financial assistance funding is sought or received from DOE; (2) shall promote and enforce Investigator compliance with the DOE Interim COI Policy’s requirements including those pertaining to disclosure of Significant Financial Interests; (3) shall manage FCOI and provide initial and ongoing FCOI Reports to DOE; (4) agrees to make information available, promptly upon request, to DOE relating to any Investigator disclosure of Financial Interests and the Company’s review of, and response to, such disclosure, whether or not the disclosure resulted in the Company’s determination of a FCOI; and (5) shall fully comply with the requirements of the DOE Interim COI Policy.

PURPOSE OF POLICY

In accordance with the DOE Interim COI Policy, the purpose of this policy is to establish standards that provide a reasonable expectation that the design, conduct, and reporting of Projects wholly or in part funded under the DOE Financial Assistance Awards will be free from bias resulting from FCOI or OCOI, by:

Providing a Company administrative process to identify, manage, and report (if applicable) any potential, perceived, or actual FCOI or OCOI.
Requiring Investigators to disclose any Significant Financial Interests to ensure any perceived, possible, or actual FCOI are identified, mitigated, and/or reported (as required).

SCOPE

This policy applies to:

The Company as a whole when it applies for or receives a DOE Financial Assistance Award;
Each Investigator (who is the Principal Investigator and any other person, regardless of title or position, who is responsible for the purpose, design, conduct, or reporting of a Project funded by DOE or proposed for funding by DOE) who is planning to participate in or is participating in the Company’s Project that is wholly funded or partially funded under the DOE Financial Assistance Award; and
Each Subrecipient that works on or supports the Company’s DOE Financial Assistance Award.
DOE’s Interim COI Policy identifies two types of conflicts of interest: (i) a Financial Conflict of Interest; and (ii) an Organizational Conflict of Interest, as defined hereinafter.

DEFINITIONS

This policy utilizes the following definitions in accordance with DOE Interim COI Policy and any terms not defined herein shall have the same meaning as ascribed to them in the DOE Interim COI Policy. Any references to the non-Federal entity must be construed as a reference to the Company.

“DOE” means the U.S. Department of Energy, the National Nuclear Security Administration (NNSA), and any components of the DOE to which the authority involved may be delegated.
“Financial Conflict of Interest” or “FCOI” means a situation in which an Investigator or the Investigator’s spouse or dependent children has a Significant Financial Interest or financial relationship that could directly and significantly affect the design, conduct, reporting or funding of a Project.
“FCOI Report” means a Non-Federal Entity’s report of a FCOI to the DOE Program Office.
“Financial interest” means anything of monetary value, whether or not the value is readily ascertainable.
“Investigator” means the PI and any other ZPC or Subrecipient employee or contractor, regardless of title or position, who is responsible for the purpose, design, conduct, or reporting of a Project funded by DOE or proposed for funding by DOE.
“Organizational Conflict of Interest” or “OCOI” means a situation where because of relationships with a parent company, affiliate, or subsidiary organization, the Non-Federal Entity is unable or appears to be unable to be impartial in conducting a procurement action involving a related organization. 2 CFR 200.318(c)(2).
“Project” means the interdependent activities funded wholly or in part under the DOE Financial Assistance Award. A Project has a defined start and end point with objectives described in an application or in an approved scope that, when attained, signify completion and achievement of a specific goal, and creation of a unique product, service, or result. For Awards that include recipient cost share as part of the approved budget, activities funded with that recipient cost share are included.
“Significant Financial Interest” means:

1. A Financial Interest consisting of one or more of the following interests of the Investigator (and those of the Investigator’s spouse and dependent children) that reasonably appears to be related to the Investigator’s Non-Federal Entity Responsibilities:
  - With regard to any foreign or domestic publicly traded entity, a significant financial interest exists if the value of any remuneration received from the entity in the twelve months preceding the disclosure and the value of any equity interest in the entity as of the date of disclosure, when aggregated, exceeds $5,000. For purposes of this definition, remuneration includes salary and any payment for services not otherwise identified as salary (e.g., consulting fees, honoraria, paid authorship); equity interest includes any stock, stock option, or other ownership interest, as determined through reference to public prices or other reasonable measures of fair market value.
  - With regard to any foreign or domestic non-publicly traded entity, a significant financial interest exists if the value of any remuneration, not otherwise disclosed as current, pending, or other support, received from the entity in the twelve months preceding the disclosure, when aggregated, exceeds $5,000, or when the Investigator (or the Investigator’s spouse or dependent children) holds any equity interest (e.g., stock, stock option, or other ownership interest).
  - Intellectual property rights and interests (e.g., patents, copyrights), upon receipt of income related to such rights and interests.
2. Investigators also must disclose the occurrence of any reimbursed or sponsored travel (i.e., that which is paid on behalf of the Investigator and not reimbursed to the Investigator so that the exact monetary value may not be readily available) related to their institutional responsibilities that is not otherwise disclosed in current and pending or other support disclosures, provided that this disclosure requirement does not apply to travel that is reimbursed or sponsored by a Federal, state, or local government agency of the United States; a domestic Institution of Higher Education; or a domestic research institute that is affiliated with a domestic Institution of Higher Education.
3. The term significant financial interest does not include the following types of Financial Interests: salary, royalties, or other remuneration paid by the Company to the Investigator if the Investigator is currently employed or otherwise appointed by the Company, including intellectual property rights assigned to the Company and agreements to share in royalties related to such rights; any ownership interest in the Company held by the Investigator, if the Company is a commercial or for-profit organization; income from investment vehicles, such as mutual funds and retirement accounts, as long as the Investigator does not directly control the investment decisions made in these vehicles; income from seminars, lectures, or teaching engagements sponsored by a Federal, state, or local government agency of the United States, a domestic Institution of Higher Education, or a domestic research institute that is affiliated with a domestic Institution of Higher Education; or income from service on advisory committees or review panels for a Federal, state, or local government agency of the United States, a domestic Institution of Higher Education, or a domestic research institute that is affiliated with a domestic Institution of Higher Education.

“Subrecipient” means an entity, usually but not limited to non-Federal entities, that receives a subaward from a pass-through entity to carry out part of a Federal Award but does not include an individual that is a beneficiary of such Award. A Subrecipient may also be a recipient of other Federal Awards directly from a Federal awarding agency.

REQUIREMENTS

The Company commits to taking actions necessary to identify, mitigate, manage, resolve, and report possible, perceived, or actual FCOI, including any financial conflicts of a Company Investigator or a Subrecipient Investigator. This includes the management of an identified FCOI, including the development and implementation of a management plan and, if necessary, a retrospective review and a mitigation report. Likewise, the Company commits to taking actions necessary to identify, mitigate, manage, resolve, and report possible, perceived, or actual OCOI.

Financial Conflicts of Interest
- Duties of Investigators to Disclose. In accordance with DOE’s Interim COI Policy, every Investigator (i.e., any ZPC or Subrecipient Investigator) has:

1. 1. a duty and responsibility to disclose Significant Financial Interests; and
  2. a requirement to complete training regarding the disclosure of Significant Financial Interests
    prior to engaging in Projects related to any DOE Financial Assistance Award; at least once every four years; and immediately when any of the following circumstances apply:

- - - The Company revises this policy or procedures in any manner that affects the requirements of Investigators;
    - An Investigator is new to the Company; or
    - The Company finds that an Investigator is not in compliance with this policy.
- Specifically, Investigators are required to:

1. Complete the Company’s Significant Financial Interests Disclosure form disclosing the Investigator’s Significant Financial Interests (and those of the Investigator’s spouse and dependent children) no later than the time of application for the DOE Award unless the Investigator is added after the time of application. The completed form should be submitted to the Company’s designated COI Official.
2. Submit an updated disclosure form at least annually during the period of the Award. Such disclosure shall include any information that was not previously disclosed and shall include updated information regarding any previously disclosed Significant Financial Interest.
3. Complete an updated disclosure form within thirty (30) days of discovering or acquiring (e.g., through purchase, marriage, or inheritance) a new Significant Financial Interest.
4. Each disclosure and updated disclosure be signed and dated by the Investigator and include a certification statement that reads:

“I understand that this Disclosure is required to obtain funding from the U.S. Government. I, [Full Name and Title], certify to the best of my knowledge and belief that the information contained in this Disclosure Statement is true, complete, and accurate. I understand that any false, fictitious, or fraudulent information, misrepresentations, half-truths, or omissions of any material fact, may subject me to criminal, civil or administrative penalties for fraud, false statements, false claims, or otherwise. (18 U.S.C. §§ 1001 and 287, and 31 U.S.C. 3729-3730 and 3801-3812). I further understand and agree that (1) the statements and representations made herein are material to U.S. Government’s funding decision, and (2) I have a responsibility to update the disclosures during the period of performance of the award should circumstances change which impact the responses provided above.”

The Company’s Designated COI Official. The Company has designated the Chief Security Officer / Chief of Staff as the designated Company official (the “Company’s Designated COI Official”), to solicit and review disclosures of significant financial interests from each Investigator, initiate a COI inquiry into a potential, perceived, or actual FCOI or OCOI and be responsible for ensuring compliance of this Policy.

1. Regarding FCOI, the Company’s Designated COI Official is responsible for determining whether an Investigator’s Significant Financial Interest is related to a Project funded under a DOE Award and, if so related, whether the Significant Financial Interest is a FCOI. An Investigator’s Significant Financial Interest is related to a Project funded under a DOE Award when the Company reasonably determines that the Significant Financial Interest could be affected by the Project, could affect the Project, is in an entity whose Financial Interest could affect the Project, or is in an entity whose Financial Interest could be affected by the Project. A FCOI exists when the Company reasonably determines that the Significant Financial Interest could directly and significantly affect the purpose, design, conduct, or reporting of the Project funded under a DOE Award.
2. The Designated COI Official must review and manage any potential, perceived, or actual FCOI by developing and implementing a management plan that shall specify the actions that have been, and shall be, taken to manage such FCOI.
3. The Designated COI Official shall maintain records relating to all Investigator disclosures of Financial Interests and the Company’s review of and response to such disclosures (whether or not a disclosure resulted in the Company’s determination of a FCOI) and all actions under this policy or in retrospective review, if applicable, for a period of three (3) years from the submission of the last expenditure report or, where applicable, from other dates specified in the individual award terms and conditions.
4. If the Designated COI Official identifies that a Significant Financial Interest was not disclosed timely or was not previously reviewed by the Company during an ongoing funded Project, they shall within 60 days review the Significant Financial Interest and determine whether a FCOI exists. If a conflict is identified, ZPC must within 120 days of determining noncompliance, complete and document a retrospective review to determine if any project activity conducted during the period of noncompliance was biased. This documentation must include the DOE award number, project title, PI name, Investigator with the FCOI, entity name, reason for review, detailed methodology, findings, and conclusions. If bias is found, ZPC shall notify the DOE promptly and submit a mitigation report detailing the impact of the bias, the extent of harm, and a plan of action to eliminate or mitigate the effect. The Designated COI Official shall be responsible for monitoring the ongoing compliance with any such management plans.

Public Accessibility to Information Concerning Significant Financial Interests

1. Prior to the Company’s expenditure of any funds under a DOE Award, the Company shall ensure public accessibility, via a written response to any requestor within five (5) business days of a request, of information concerning any Significant Financial Interest disclosed to the Company that meets the following three criteria: (1) the Significant Financial Interest is still held by the senior/key personnel as defined by this policy; (2) the Company determined that the Significant Financial Interest is related to the Project funded under the DOE Award; and (3) the Company determined that the Significant Financial Interest is a FCOI.
2. The Company shall provide the following minimum information: (1) the Investigator’s name; (2) the Investigator’s title and role with respect to the Project; (3) the name of the entity in which the Significant Financial Interest is held; (3) the nature of the Significant Financial Interest; and (4) the approximate dollar value of the Significant Financial Interest or a statement that the interest is one whose value cannot be readily determined through reference to public prices or other reasonable measures of fair market value.

Reporting of Financial Conflict of Interest

1. In accordance with DOE’s Interim COI Policy, prior to the ZPC’s expenditure of any funds under a DOE-funded Project, and at least annually thereafter, the Company shall provide to the DOE Program Office a FCOI Report regarding any Investigator’s unmanaged or unmanageable Significant Financial Interest found by the Company to be conflicting.
2. The Company shall provide, on request, FCOI Reports and supporting documentation about any Significant Financial Interest found by the Company to be conflicting, regardless of whether or not the conflict has been managed, mitigated, or eliminated. Such FCOI Reports will include: (1) the name of the Investigator with the FCOI; (2) the name of the entity with which the Investigator has a FCOI; (3) the nature of any applicable Financial Interest (e.g., equity, consulting fee, travel reimbursement, honorarium) and/or applicable external relationships or activities; (4) value of any applicable Financial Interest or a statement that the interest is one whose value cannot be readily determined through reference to public prices or other reasonable measures of fair market value; (5) a description of how the Financial Interest relates to the Project funded under a DOE Award and the basis for the Company’s determination that there is a conflict with such Project.
3. For any FCOI previously reported by the Company, it shall provide DOE with an annual FCOI report that addresses the status of the conflict and changes to the management plan, if any. The annual FCOI report shall explain if the conflict is managed, remains unmanaged or no longer exists.
Organizational Conflicts of Interest

The primary objective of this section is to prevent and/or mitigate any situation in which an OCOI may arise.

To the extent that the Company becomes aware of any potential or actual OCOI, it shall disclose such OCOI in writing to the appropriate DOE Program Office in (a) any application for financial assistance; or (b) prior to engaging in a procurement or transaction using DOE funds with a parent, affiliate, or subsidiary organization (to the extent one exists in the future).
In compliance with DOE’s Interim COI Policy, such a disclosure shall include: (i) The name, address, and website (as applicable) of the entity that presents a potential or actual OCOI; (ii) the relationship between the Company and the entity at issue; (iii) the nature of the anticipated procurement or other transaction with the parent, affiliate, or subsidiary organization; the anticipated value of the procurement or other transaction; and the basis for making the procurement or other transaction with a parent, affiliate, or subsidiary organization; (iv) the basis for the Company’s determination regarding the existence of an OCOI; and (v) how the Company will avoid, neutralize, or mitigate the OCOI.
The Company recognizes that if the effects of the potential or actual OCOI cannot be avoided, neutralized, or mitigated, it shall procure goods and services from other sources when using DOE funds.

OTHERS

Failure to comply with this Process may result in disciplinary action, up to and including discharge. Financial and other information disclosed in compliance with this Policy by the Investigators will be kept confidential and disclosed only on a need-to-know basis as required to perform appropriate review and evaluation required by this Policy, except as otherwise required by law.