INTERNAL REVENUE SERVICE P. 0. BOX 2508 CINCINNATI, OH 45201 DEPARTMENT OF THE TREASURY Date: APR 0 5 2011 Employer Identification Number: 27-2894856 DLN: PROJECT VERITAS 815 BRAZOS ST., SUITE 701 AUSTIN, TX 78701 17053217308010 Contact Person: MARK I . TOMBACK ID# 95020 Contact Telephone Number: (877) 829-5500 Accounting Period Ending: December 31 Public Charity Status: 170 (b) (1) (A) (vi) Form 990 Required: Yes Effective Date of Exemption: June 22, 2010 Contribution Deductibility: Yes Addendum Applies: No Dear Applicant: We are pleased to inform you that upon review of your application for tax exempt status we have determined that you are exempt from Federal income tax under section 501(c) (3) of the Internal Revenue Code. Contributions to you are deductible under section 170 of the Code-. You are also qualified to receive tax deductible bequests, devises, transfers or gifts under section 2055, 2106 or 2522 of the Code. Because this letter could help resolve any questions regarding your exempt status, you should keep it in your permanent records. Organizations exempt under section 501(c) (3) of the Code are further classified as either public charities or private foundations. We determined that you are a public charity under the Code section(s) listed in the heading of this letter. Please see enclosed Publication 4221-PC, Compliance Guide for 501(c) (3) Public Charities, for some helpful information about your responsibilities as an exempt organization. Sincerely, --- i~ vi?id Enclosure: Publication 4221-PC . \J\4o ... a Lois G. rner Director, Exempt Organizations Letter 947 (DO/CG) Form 1023 Checklist (Revised June 2006) Application for Recognition of Exemption under Section 501 (c)(3) of the Internal Revenue Code Note. Retain a copy of the completeo Form 1023 in your permanent records. Refer to the General Instructions regarding Public Inspection of approveo applications. Check each box to finish your application (Fonn 1023). Send this completed Checklist with your filled-in application. If you have not answered all the items below, your application may be retumed to you as incomplete. Ill Assemble the application and materials in this order. o Form 1023 Checklist o Form 2848, Power of Attorney and Declaration of Representative Of filing) o Form 8821, Tax Information Authorization Of filing) o Expedite request (if requesting) o Application (Form 1023 and Schedules A through H, as required) o Articles of organization o Amendments to articles of organization in chronological order o Bylaws or other rules of operation and amendments o Documentation of nondiscriminatory policy for schools, as required by Schedule B o Form 5768, Eleclion/Revocation of Election by an Eligible Section 501(c)(3) Organization To Make Expenditures To Influence Legislation (if filing) o All other attachments, including explanations, financial data, and printed materials or publications. Label each page with name and EIN. User fee payment placed in envelope on top of checklist. DO NOT STAPLE or otherwise attach your check or money order to your application. Instead, just place it in the envelope. Employer Identification Number (EIN) Completed Parts I through XI of the application, including any requested information and any required Schedules A through H. o You must provide specific details about your past, present, and planned activities. o Generalizations or failure to answer questions in the Form 1023 application will prevent us from recognizing you as tax exempt. o Describe your purposes and proposed activities in specific easily understood terms. o Financial information should correspond with proposed activities. Ill Ill Ill Ill .Schedules. Submit only those schedules that apply to you and check either "Yes" or "No" below. Schedule A Schedule B Schedule C ScheduleD Yes_ No__{__ Yes_ No__{__ Yes_ NoL Yes_ NoL Schedule E Schedule F Schedule G Schedule H Yes_ No__{__ Yes_ No__{__ Yes_ No_L_ Yes_ NoL Ill An exact copy of your complete articles of organization (creating document). Absence of the proper purpose and dissolution clauses is the number one reason for delays in the issuance of determination letters. o Location of Purpose Clause from Part Ill, line 1 (Page, Article and Paragraph Number) Article 7 o Location of Dissolution Clause from Part Ill, line 2b or 2c (Page, Article and Paragraph Number) or by operation of state law Article 8 Ill Ill Signature of -an officer, director, trustee, or other official who is authorized to sign the application. o Signature at Part XI of Form 1023. Your name on the application must be the same as your legal name as it appears in your articles of organization. Send completed Form 1023, user fee payment, and all other required information, to: Internal Revenue Service P.O. Box 192 Covington, KY 41012-0192 If you are using express mail or a delivery service, send Form 1023, user fee payment, and attachments to: Internal Revenue Service 201 West Rivercenter Blvd. Attn: Extracting Stop 312 Covington, KY 41011 1705321730801 0 F~ 1023 (Rev. June 2006) Department ol the Treasury Internal Revenue Service Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code OMB No. 1545-0056 Note: If exempt status is approved, this application will be open for pUblic inspection. Use the instructions to complete this application and for a definition of all bold items. For additional help, catl IRS Exempt Organizations Customer Account Services toll-free at 1-877-829-5500. Visit our website at www.irs.gov for forms and publications. If the required information and documents are not submitted with payment of the appropriate user fee, the application may be returned to you. Attach additional sheets to this application if you need more space to answer fully. Put your name and EIN on each sheet and identify each answer by Part and line number. Complete Parts I o XI of Form 1023 and submit only those Schedules (A through H) that apply to you. Identification of Applicant 1 Full name of organization (exactly as it appears in your organizing document) 2 c/o Name (if applicable) Project Veritas 3 Mailing address (Number and street).(see instructions) Room/Suite 4 Employer ldentffication Number (EIN) 1922 N. Quincy St. City or town, state or country, and ZIP + 4 27-2894856 5 Month the annual accounting period ends (01 -12) 12 b Phone: Arlington, VA 22207 6 Primary contact (officer, director, trustee, or authorized representative) a Name: Isabel Santa, Secretary 202-596-2781 c Fax: (op1ional) 7 Are you represented by an authorized representative, such as an attorney or accountant? If "Yes," provide the authorized representative's name, and the name and address of the authorized representative's firm. Include a completed Fonn 2848, Power of Attorney and Declaration of Representative, with your application if you would like us to communicate with your representative. D Yes Ill No 8 Was a person who is not one of your officers, directors, trustees, employees, or an authorized representative listed in line 7, paid, or promised payment, to help plan, manage, or advise you about the structure or activities of your organization, or about your financial or tax matters? If "Yes," provide the person's name, the name and address of the person's firm, the amounts paid or promised to be paid, and describe that person's role. D Yes Ill No 9a Organization's website: b Organization's email: (optional) 10 Certain organizations are not required to file an information return (Form 990 or Form 990-EZ). If you are granted tax-exemption, are you claiming to be excused from filing Form 990 or Form 990-EZ? If "Yes," explain. See the instructions for a description of organizations not required to file Form 990 or Form 990-EZ. Date incorporated if a corporation, or formed, if other than a corporation. Were you formed under the laws of a foreign country? If "Yes," state the country. Cat. No. 17133K D Yes Ill No 11 12 (MM/DDIYYYY) 061221 2010 0 Form Yes Ill No For Paperwork Reduction Act Notice, see page 24 of the instructions. 1023 (Rev. 6-2006) 1 '715201 021702 8 AUG 0 2 '10 c;i?! ?:.N: if~,., :.:.;;;;,~v:,._?c u_:-~: ~~H WG 04 '10 Name: Project Veritas EIN' 27 - 2894856 2 You must be a corporation (including a limited liability company), an unincorporated association, or a trust to be tax exempt. (See instructions.) DO NOT file this fonn unless you can check "Yes" on lines 1, 2, 3, or 4. 1 Are you a corporation? If "Yes," attach a copy of your articles of incorporation showing certification of filing with the appropriate state agency. Include copies of any amendments to your articles and be sure they also show state filing certffication. Are you a limited liability company (LLC)? If "Yes," attach a ccpy of your articles of organization showing certification of filing with the appropriate state agency. Also, if you adopted an operating agreement, attach a copy. Include copies of any amendments to your articles and be sure they show state filing certification. Refer to the instructions for circumstances when an LLC should not file its own exemption application. Are you an unincorporated association? If "Yes," attach a copy of your articles of association, constitution, or other similar organizing document that is dated and includes at least two signatures. Include signed and dated copies of any amendments. G21 Yes 0 No Ill No 2 D Yes 3 D Yes Ill No Ill No 4a Are you a trust? If "Yes," attach a signed and dated copy of your trust agreement. Include signed and dated copies of any amendments. b Have you been funded? If "No," explain how you are fanned without anything of value placed in trust. 5 Have you adopted If "Yes," attach a current copy showing date of adoption. If "No," explain I DYes 0 Yes ~Yes 0 0 No No The following questions are designed to ensure that when you file this application, your organizing document contains the required provisions to meet the organizational test under section 501 (c)(3). Unless you can check the boxes in both lines 1 and 2, your organizing document does not meet the organizational test. DO NOT file this application urltil you have amended your organizing document Submit your original and amended organizing documents (showing state filing certification if you are a corporation or an LLC) with your application. 1 Section 501 (c}(3) requires that your organizing document state your exempt purpose(s), such as charitable, religious, educational, and/or scientific purposes. Check the box to confirm that your organizing document meets this requirement. Describe specifically where your organizing document meets this requirement, such as a reference to a particular article or section in your organizing document. Refer to the instructions for exempt purpose language. Location of Purpose Clause (Page, Article, and Paragraph): Article 7 Ill 2a Section 501{c){3) requires that upon dissolution of your organization, your remaining assets must be used exclusively for exempt purposes, such as charitable, religious, educational, and/or scientific purposes. Check the box on line 2a to confirm that your organizing document meets this requirement by express provision for the distribution of assets upon dissolution. If you rely on state law for your dissolution provision, do not check the OOx on Kne 2a and go to line 2c. 2b If you checked the box on line 2a, specify the location of your dissolution clause (Page, Article, and Paragraph). Do not complete line 2c if you checked box 2a. ~A.::M..:I:.:C;:;Ie:...;o6_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ 2c See the instructions for information about the operation of state law in your particular state. Check this box if you rely on operation of state law for your dissolution provision and indicate the state: Ill 0 i#iili1 Narrative Description of Your Activities lijffifl 1a List the names, titles, and mailing addresses of all of your officers, directors, and trustees. For each person listed, state their total annual compensation, or proposed compensation, for all services to the organization, whether as an officer, employee, or other position. Use actual figures, if available. Enter "none" if no compensation is or will be paid. If additional space is needed, attach a separate sheet. Refer to the instructions for information on what to include as compensation. Name Title Mailing address Compensation amount (annual actual or estimated) Gregory Levitsky Maureen Wagner Francisco Gonzales Isabel Santa Director, President Director, Chairman Director, Treasurer Director, Sec., Executive Dir. 1-~~~-t;l_u~n<:v_~t, _____________________ Arlington, VA 22207 1922 Quincy 51. Arlin on, VA 22207 1!I~ _9-~~ nc:y_ ~'-?- ____________________ Arlington, VA 22207 1_92_2 _(l_uin_c;y_ !5t._____________________ Arlington, VA 22207 0 0 0 55,000 -----,9i,----------?- ------? -???------ ---------- ?-------. ?------ -- -? .. ----- --? Form 1023 (Rev. 6-2006) lilfiifi Fonn 1023 (Rev. 6?2006) Name: Project Veritas EIN: 27- 2894856 Compensation and Other Financial Arrangements With Your Officers, Directors, Trustees, Employees, and Independent Contractors (Continued) Page 3 b List the names, titles, and mailing addresses of each of your five highest compensated employees who receive or will receive compensation of more than $50,000 per year. Use the actual figure, if available. Refer to the instructions for information on what to include as compensation. Do not include officers, directors, or trustees listed in line 1a. Compensation amount Name Trtle Mailing address (annual actual or estimated) James O'Keefe Founder c List the names, names of businesses, and mailing addresses of your five highest compensated Independent contractors that receive or will receive compensation of more than $50,000 per year. Use the actual figure, if available. Refer to the instructions for information on what to include as compensation. Compensation amount Name ' Trtle Mailing address (annual actual or estimated) TBD (See attachment) The following "Yes" or "No" questions relate to past, present, or planned relat1onsh1ps, transactions, or agreements with your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed in lines 1a, 1b, and 1c. 2a Are any of your officers, directors, or trustees related to each other through family or business relationships? If "Yes, n identify the individuals and explain the relationship. b Do you have a business relationship with any of your officers, directors, or trustees other than through their position as an officer, director, or trustee? If "Yes," identify the individuals and describe the business relationship with each of your officers, directors, or trustees. c Are any of your officers, directors, or trustees related to your highest compensated employees or highest compensated independent contractors listed on lines 1 b or 1c through family or business relationships? If "Yes," identify the individuals and explain the relationship. 0 Yes Yes Ill No Iii No Ill No 0 0 Yes 3a For each of your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed on lines 1a, 1b, or 1c, attach a list showing their name, qualifications, average hours worked, and duties. b Do any of your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed on lines 1a, 1b, or 1c receive compensation from any other organizations, whether tax exempt or taxable, that are related to you through common control? If "Yes," identify the individuals, explain the relationship between you and the other organization, and describe the compensation arrangement. 4 In establishing the compensation for your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed on lines 1a, 1b, and 1c, the following practices are recommended, although they are not required to obtain exemption. Answer "Yes" to all the practices you use. a Do you or will the individuals that approve compensation arrangements follow a conflict of interest policy? b Do you or will you approve compensation arrangements in advance of paying compensation? c Do you or will you document in writing the date and terms of approved compensation arrangements? DYes Iii No Ill Ill Gi'l Form Yes Yes Yes 0 D No D No No 1023 (Rev. 6?2006) Form 1023 (Rev. 6-2006) Name: Project Verltas ElN: 27 - 2894856 Page 4 lf$ijii Compensation and Other Financial Arrangements With Your Officers, Directors, Trustees, Employees, and Independent Contractors (Continued) d Do you or will you record in writing the decision made by each individual who decided or voted on compensation arrangements? e Do you or will you approve compensation arrangements based on information about compensation paid by similarty situated taxable or tax-exempt organizations for similar services, current compensation surveys compiled by independent firms, or actual written offers from similarly situated organizations? Refer to the instructions for Part V, lines 1a, 1b, and 1c, for infonnation on what to include as compensation. f Do you or will you record in writing both the information on which you relied to base your decision and its source? g If you answered "No" to any item on lines 4a through 4f, describe how you set compensation that is reasonable for your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed in Part V, lines 1a, 1b, and 1c. Sa Have you adopted a conflict of interest policy consistent with the sample conflict of interest policy in Appendix A to the instructions? If '"Yes," provide a copy of the policy and explain how the policy has been adopted, such as by resolution of your governing board. If "No," answer lines Sb and Sc. b What procedures will you follow to assure that persons who have a conflict of interest will not have influence over you for setting their own compensation? c What procedures will you follow to assure that persons who have a conflict of interest will not have influence over you regarding business deals with themselves? Note: A conflict of interest policy is recommended though it is not required to obtain exemption. Hospitals, see Schedule C, Section I, line 14. Ill Yes 0 No 0 No ~ Yes GZ1 Yes 0 No Ill Yes 0 No 6a Do you or will you compensate any of your officers, directors, trustees, highest compensated employees, and highest compensated independent contractors listed in lines 1a, 1b, or 1c through non-fiXed payments, such as discretionary bonuses or revenue-based payments? If "Yes," describe all non-fixed compensation arrangements, including how the amounts are determined, who is eligible for such arrangements, whether you place a limitation on total compensation, and how you determine or will determine that you pay no more than reasonable compensation for services. Refer to the instructions for Part V, lines 1a, 1b, and 1c, for information on what to include as compensation. b Do you or will you compensate any of your employees, other than your officers, directors, trustees, or your five highest compensated employees who receive or will receive compensation of more than $50,000 per year, through non-fixed payments, such as discretionary bonuses or revenue-based payments? If "Yes," describe all non-fixed compensation arrangements, including how the amounts are or will be determined, who is or will be eligible for such arrangements, whether you place or will place a limitation on total compensation, and how you determine or will determine that you pay no more than reasonable compensation for services. Refer to the instructions for Part V, lines 1a, 1b, and 1c, for information on what to include as compensation. 7a Do you or will you purchase any goods, services, or assets from any of your officers, directors, trustees, highest compensated employees, or highest compensated independent contractors listed in lines 1a, 1b, or 1c? If "Yes," describe any such purchase that you made or intend to make, from whom you make or will make such -purchases, how the terms are or will be negotiated at arm's length, and explain how you determine or will determine that you pay no more than fair market value. Attach copies of any written contracts or other agreements relating to such purchases. b Do you or will you sell any goods, services, or assets to any of your officers, directors, trustees, highest compensated employees, or highest compensated independent contractors listed in lines 1a, 1b, or 1c? If "Yes, n describe any such sales that you made or intend to make, to whom you make or will make such sales, how the terms are or will be negotiated at arm's length, and explain how you determine or will determine you are or wilt be paid at least fair market value. Attach copies of any written contracts or other agreements relating to such sales. Gll Yes 0 No Ill Yes 0 No 0 Yes Iii No 0 Yes Iii No 8a Do you or will you have any leases, contracts, loans, or other agreements with your officers, directors, trustees, highest compensated employees, or highest compensated independent contractors listed in lines 1a, 1b, or 1c? If "Yes," provide the information requested in lines 8b through Bf. b c. d e f Describe any written or oral arrangements that you made or intend to make. Identify with whom you have or will have such arrangements. Explain how the terms are or will be negotiated at arm's length. Explain how you determine you pay no more than fair market value or you are paid at least fair market value. Attach copies of any signed leases, contracts, loans, or other agreements relating to such arrangements. 0 Yes Iii No 9a Do you or will you have any leases, contracts, loans, or other agreements with any organization in which any of your officers, directors, or trustees are also officers, directors, or trustees, or in which any individual officer, director, or trustee owns more than a 35% interest? If "Yes," provide the information requested in lines 9b through 9f. 0 Yes ~ No Form 1023 (Rev. 6?2006) Form 1023 (Rev. 6-2006) Name: Project Veritas EIN: 27 - 2894856 Page 5 l$ijlfl b c d e Compensation and Other Financial Arrangements With Your Officers, Directors, Trustees, Employees, and Independent Contractors (Continued) Describe any written or oral arrangements you made or intend to make. Identify with whom you have or will have such arrangements. Explain how the terms are or will be negotiated at arm's length. Explain how you determine or will determine you pay no more than fair market value or that you are paid at least fair market value. f Attach a copy of any signed leases, contracts, loans, or other agreements relating to such arrangements. liliiji!JI Your Members and Other Individuals and Organizations That Receive Benefits From You The following "Yes" or "No'" questions relate to goods, services, and funds you provide to individuals and organizations as part of your activities. Your answers should pertain to past, present, and planned activities. (See instructions.) 1a In carrying out your exempt purposes, do you provide goods, services, or funds to individuals? If "Yes," describe each program that provides goods, services, or funds to individuals. b In carrying out your exempt purposes, do you provide goods, services, or funds to organizations? If "Yes," describe each program that provides goods, services, or funds to organizations. 2 Do any of your programs limit the provision of goods, services, or funds to a specific individual or group of specific individuals? For example, answer "Yes," ~f goods, services, or funds are provided only for a particular individual, your members, individuals who work for a particular employer, or graduates of a particular school. If "Yes," explain the limitation and how recipients are selected for each program. Do any individuals who receive goods, services, or funds through your programs have a family or business relationship with any officer, director, trustee, or with any of your highest compensated employees or highest compensated independent contractors listed in Part V, lines 1a, 1 b, and 1c? If "Yes," explain how these related individuals are eligible for goods, services, or funds. 0 Yes Ill No DYes DYes Iii No Iii No 3 0 Yes Iii No 1Qfiji911 1 Your History The following "Yes" or "No" questions relate to your history. (See Instructions.) Are you a successor to another organization? Answer "Yes," if you have taken or will take over the activities of another organization; you took over 25% or more of the fair market value of the net assets of another organization; or you were established upon the conversion of an organization from for-profit to non-profit status. If "Yes," complete Schedule G. Are you submitting this application more than 27 months after the end of the month in which you were legally formed? If "Yes,'" complete Schedule E. D Yes Iii No 2 DYes Iii No l:aJII9111 Your Specific Activities The following "Yes" or "No" questions relate to specific activities that you may conduct. Check the appropriate box. Your answers should pertain to past, present, and planned activities. (See instructions.} Do you support or oppose candidates in political campaigns in any way? If "Yes," explain. 2a Do you attempt to influence legislation? If "Yes," explain how you attempt to influence legislation and complete line 2b. If "No," go to line 3a. b Have you made or are you making an election to have your legislative activities measured by expenditures by filing Form 5768? If "Yes," attach a copy of the Form 5768 that was already filed or attach a completed Form 5768 that you are filing with this application. If "No," describe whether your attempts to influence legislation are a substantial part of your activities. Include the time and money spent on your attempts to influence legislation as compared to your total activities. 0 D Yes Yes Yes Iii No Iii No Iii No 0 3a Do you or will you operate bingo or gaming activities? If "Yes," describe who conducts them, and list all revenue received or expected to be received and expenses paid or expected to be paid in operating these activities. Revenue and expenses should be provided for the time periods specified in Part IX, Financial Data. b Do you or wt\1 you enter into contracts or other agreements with individuals or organizations to conduct bingo or gaming for you? If "Yes," descrfbe any written or oral arrangements that you made or intend to make, identity with whom you have or will have such arrangements, explain how the terms are or will be negotiated at ann's length, and explain how you determine or will determine you pay no more than fair market value or you will be paid at least fair market value. Attach copies or any written contracts or other agreements relating to such arrangements. c List the states and local jurisdictions, including Indian Reservations, in which you conduct or will conduct gaming or bingo. 0 Yes Iii No 0 Yes Iii No Form 1023 (Rev. 6-2006) Fonn 1023 (Rev. 6-2006) Name: Project Veritas ElN: 27- 2894856 Page 6 lilffllijlll Ill Ill Ill 0 Ill Your Specific Activities (Continued) 4a Do you or will you undertake fundraising? If "Yes," check all the fundraising programs you do or witl conduct. (See instructions.) mail solicitations email solicitations personal solicitations vehicle, boat, plane, or similar donations foundation grant solicitations Ill Yes 0 No Ill phone solicitations receive donations from another organization's website government grant solicitations Other Ill accept donations on your website D D D Attach a description of each fundraising program. b Do you or will you have written or oral contracts with any individuals or organizations to raise funds Ill Yes 0 No for you? If "Yes," describe these activities. Include all revenue and expenses from these activities and state who conducts them. Revenue and expenses should be provided for the time periods specified in Part IX, Financial Data. Also, attach a copy of any contracts or agreements. c Do you or will you engage in fundraising activities for other organizations? If "Yes," describe these arrangements. Include a description of the organizations for which you raise funds and attach copies of all contracts or agreements. 0 Yes Ill No d List all states and local jurisdictions in which you conduct fundraising. For each state or local jurisdiction listed, specify whether you fundraise for your own organization, you fundraise for another organization, or ~other organization fundraises for you. e Do you or will you maintain separate accounts for any contributor under which the contributor has the right to advise on the use or distribution of funds? Answer "Yes" if the donor may provide advice on the types of investments, distributions from the types of investments, or the distribution from the donor's contribution account. If "Yes," describe this program, including the type of advice that may be provided and submit copies of any written materials provided to donors. DYes Ill No 5 Are You affiliated with a governmental unit? If "Yes," explain. 6a Do you or will you engage in economic development? If "Yes," describe your program. b Describe in full who benefits from your economic development activities and how the activities promote exempt purposes. 7a Do or will persons other than your employees or volunteers develop your facilities? If "Yes," describe DYes DYes Ill No Ill No Ill No ~No DYes each facility, the role of the developer, and any business or family relationship{s) between the developer and your officers, directors, or trustees. b Do or will persons other than your employees or volunteers manage your activities or facilities? If "Yes," describe each activity and facility, the role of the manager, and any business or family relationship(s) between the manager and your officers, directors, or trustees. c If there is a business or family relationship between any manager or developer and your officers, directors, or trustees, identify the individuals, explain the relationship, describe how contracts are negotiated at arm's length so that you pay no more than fair market value, and submit a copy of any contracts or other agreements. 8 DYes Do you or will you enter into joint ventures, including partnerships or limited liability companies treated as partnerships, in which you share profits and losses with partners other than section 501(c)(3) organizations? If "Yes," describe the activities of these joint ventures in which you participate. lines 9b through 9d. If "No," go to line 10. 0 Yes Ill No 9a Are you applying for exemption as a childcare organization under section 501 (k)? If "Yes," answer DYes DYes Ill No b Do you provide child care so that parents or caretakers of children you care for can be gainfully employed (see instructions)? If "No," explain how you qualify as a childcare organization described in section 501 (k). c Of the children for whom you provide child care, are 85% or more of them cared for by you to enable their parents or caretakers to be gainfully employed (see instructions)? If "No," explain how you qualify as a childcare organization described in section 501 (k). 0 No DYes 0 0 0 No d Are your services available to the general public? If "No," describe the specific group of people for whom your activities are available. Also, see the instructions and explain how you qualify as a childcare organization described in section 501 (k). 10 DYes No Do you or will you publish, own, or have rights in music, literature, tapes, artworks, choreography, scientific discoveries, or other intellectual property? If "Yes," explain. Describe who owns or will own any copyrights, patents, or trademarks, whether fees are or will be charged, how the fees are determined, and how any items are or will be produced, distributed, and marketed. ~Yes No Form 1023 (Rev. 6-2006) Veritas 11 EIN' 27 - 2894856 7 Do you or will you accept contributions of: real property; conservation easements; closely held securities; intellectual property such as patents, trademarks, and copyrights; works of music or art; licenses; royalties; automobiles, boats, planes, or other vehicles; or collectibles of any type? If "Yes," describe each type of contribution, any conditions imposed by the donor on the contribution, and any agreements with the donor regarding the contribution. D Yes 1?1 No 12a Do you or will you operate in a foreign country or countries? If "Yes," answer lines 12b through 0 Yes 1?1 No 12d. If "No," go to line 13a. b Name the foreign countries and regions within the countries in which you operate. c Describe your operations in each country and region in which you operate. d Describe how your operations in each country and region further your exempt purposes. 13a Do you or will you make grants, loans, or other distributions to organization(s)? If "Yes," answer lines 0 0 Yes 1?1 No 13b through 13g. If "No," go to line 14a. b Describe how your grants, loans, or other distributions to organizations further your exempt purposes. c Do you have written contracts with each of these organizations? If "Yes," attach a copy of each contract. d Identify each recipient organization and any relationship between you and the recipient organization. e Describe the records you keep with respect to the grants, loans, or other distributions you make. f Describe your selection process, including whether you do any of the following: (i) Do you require an application form? If "Yes," attach a copy of the form. pi) Do you require a grant proposal? If "Yes," describe whether the grant proposal specifies your responsibilities and those of the grantee, obligates the grantee to use the grant funds only for the purposes for which the grant was made, provides for periodic written reports concerning the use of grant funds, requires a final written report and an accounting of how grant funds were used, and acknowledges your authority to withhold and/or recover grant funds in case such funds are, or appear to be, misused. g Describe your procedures for oversight of distributions that assure you the resources are used to further your exempt purposes, including whether you require periodic and final reports on the use of resources. 14a Do you or will you make grants, loans, or other distributions to foreign organizations? If "Yes," answer lines 14b through 14f. If "No," go to line 15. Yes 0 No 0 0 Yes Yes 0 No 0 No 0 Yes 1?1 No b Provide the name of each foreign organization, the country and regions within a country in which each foreign organization operates, and describe any relationship you have with each foreign organization. c Does any foreign organization listed in line 14b accept contributions earmarked for a specific country or specific organization? If "Yes," list all earmarked organizations or countries. D D Yes Yes 0 No d Do your contributors know that you have ultimate authority to use contributions made to you at your discretion for purposes consistent with your exempt purposes? lf "Yes," describe how you relay this information to contributors. 0 No 0 No e Do you or will you make pre-grant inquiries about the recipient organization? If "Yes," describe these inquiries, including whether you inquire about the recipient's financiaJ status, its tax-exempt status under the Internal Revenue Code, its ability to accomplish the purpose for which the resources are provided, and other relevant information. f Do you or will you "use any additionat' procedures to ensure that your distributions to foreign D Yes D Yes 0 No organizations are used in furtherance of your exempt purposes? If "Yes," describe these procedures, including site visits by your employees or compliance checks by impartial experts, to verify that grant funds are being used appropriately. Form 1023 (Rev. 6-2006) Form 1023 (Rev. 6-2006) l@i!Jill 15 16 17 18 19 20 21 22 Name: Project Veritas Your Specific Activities (Continued) EIN: 27 - 2894856 Page 8 Do you have a close connection with any organizations? If '"Yes," explain. Are you applying fer exemption as a cooperative hospital service organization under section 501(e)? If "Yes," explain. Are you applying for exemption as a cooperative service organization of operating educational organizations under section 501(f)? If "Yes," explain. Are you applying for exemption as a charitable risk pool under section 501(n)? If wYes," explain. D D D D D D D D Yes Yes Yes Yes Yes Yes Yes Yes ~ No Iii No ~ No No No No Iii No ~ ~ ~ Do you or will you operate a school? If wYes," complete Schedule B. Answer "Yes," whether you operate a school as your main function or as a secondary activity. Is your main function to provide hospital or medical care? If "Yes," complete Schedule C. Do you or will you provide low-income housing or housing for the elderly or handicapped? If "Yes,"' complete Schedule F. Do you or will you provide scholarships, fellowships, educational loans, or other educational grants to individuals, including grants for travel, study, or other similar purposes? If ..Yes," complete Schedule H. lill No Note: Private foundations may use Schedule H to request advance approval of individual grant procedures. Form 1023 (Rev. 6-2006) Form 1023 (Rev. 6-2006) Name: Project Veritas EIN: 27 - 2894856 Page 9 l:tijji?1 Financial Data For purposes of this schedule, years in existence refer to completed tax years. If in existence 4 or more years, complete the schedule for the most recent 4 tax years. If in existence more than 1 year but less than 4 years, complete the statements for each year in existence and provide projections of your likely revenues and expenses based on a reasonable and good faith estimate of your future finances for a total of 3 years of financial information. If in existence tess than 1 year, provide projections of your likely revenues and expenses for the current year and the 2 followiilg years, based on a reasonable and good faith estimate of your future finances for a total of 3 years of financial information. (See instructions.) To _ To oooooooo (e) Provide Total for (a) through (d) Gifts, grants, and contributions received (do not include unusual 15 Contributions, gifts, and similar amou1"s (attach an itemized I Disbursements to or for the benefit of members (attach an itemized list} 16 17 Ally expense not otherwise classified, such as program services (attach itemized list) 24 Form 1023 (Rev. 6-2006) 27-2894856 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Assets Cash . . . . . Accounts receivable, net Inventories . . . Bonds and notes receivable (attach an itemized list) Corporate stocks (attach an itemized list) Loans receivable (attach an itemized list} . . . . Other investments (attach an itemized list) Depreciable and depletable assets (attach an itemized list) . Land . . . . . . . . . . Other assets (attach an itemized list) . Total Assets (add lines 1 through 10) Liabilities Accounts payable . . . . . . Contributions, gifts, grants, etc. payable Mortgages and notes payable (attach an itemized list) Other liabilities (attach an itemized list) Total Liabilities (add lines 12 through 15) Fund Balances or Net Assets Tatal fund balances or net assets . . . . . "I Have there been any substantial changes in your assets or liabilities since the end of the period shown above? If "'Yes," explain. 0 Yes lpt!iQ Public Charity Status Part X is designed to classify you as an organization that is either a private foundation or a public charity. Public charity status isa more favorable tax status than private foundation status. If you are a private foundation, Part X is designed to further determine whether you are a private operating foundation. (See instructions.) 1a Are you a private foundation? If "Yes," go to line 1b. If "No," go to line 5 and proceed as instructed. If you are unsure, see the instructions. DYes lill No b As a private foundation, section 508(e) requires special provisions in your organizing document in addition to those that apply to aU organizations described in section 501 (c)(3). Check the box to confirm that your organizing document meets this requirement, whether by express provision or by reliance on operation of state law. Attach a statement that describes specifically where your organizing document meets this requirement, such as a reference to a particular article or section in your organizing document or by operation of state law. See the instructions, including Appendix B, for information about the special provisions that need to be contained in your organizing document. Go to line 2. 2 D Are you a private operating foundation? To be a private operating foundation you must engage directly in the active conduct of charitable, religious, educational, and similar activities, as opposed to indirectly carrying out these activities by providing grants to individuals or other organizations. If "Yes," go to line 3. If "No," go to the signature section of Part XI. Have you existed for one or more years? If "Yes," attach financial information showing that you are a private operating foundation; go to the signature section of Part XI. If "No," continue to line 4. Have you attached either (1) an affidavit or opinion of counsel, (including a written affidavit or opinion from a certified public accountant or accounting firm with expertise regarding this tax law matter), that sets forth facts concerning your operations and support to demonstrate that you are likely to satisfy the requirements to be classified as a private operating foundation; or (2) a statement describing your proposed operations as a private operating foundation? D Yes 0 No 3 4 D D Yes Yes D No D No 5 If you answered "No" to line 1a, indicate the type of public charity status you are requesting by checking one of the choices below. You may check only one box. The organization is not a private foundation because it is: a 509(a)(1) and 170(b)(1)(A)(i)-a church or a convention or association of churches. Complete and attach Schedule A. b 509(a)(1) and 170(b)(1)(A)(ii)-a school. Complete and attach Schedule B. c 509(a)(1) and 170(b)(1)(A)(iii)-a hospital, a cooperative hospital service organization, or a medical research organization operated in conjunction with a hospital. Complete and attach Schedule C. D D D D (Rev. 6-2006) d 509(a){3)-an organization supporting either one or more organizations described in line Sa through c, f, g, or h or a publicly supported section 501 (c)(4), (5), or (6) organization. Complete and attach Schedule D. Form 1023 Form 1023 (Rev. 6-2006) Name: Project Veritas EINo 27 - 2894856 Page li!lfiij 11 Public Charity Status (Continued) e 509(a)(4)-an organization organized and operated exclusively for testing for public safety. f 509(a)(1) and 170(b)(1)(A)(iv)--an organization operated for the benefit of a college or university that is owned or operated by a governmental unit. g 509(a)(1) and 1 70(b)(1)(A)(vi)-an organization that receives a substantial part of its financial support in the form of contributions from publicly supported organizations, from a governmental unit, or from the general public. h 509(a)(2)-an organization that normally receives not more than one-third of its financial support from gross investment income and receives more than one-third of its financial support from contributions, membership fees, and gross receipts from activities related to its exempt functions (subject to certain exceptions). A publicly supported organization, but unsure if it is described in 5g or 5h. The organization would like the IRS to decide the correct status. 6 If you checked box g, h, or i in question 5 above, you must request either an advance or a definitive ruling by selecting one of the boxes below. Refer to the instructions to detennine which type of ruling you are eligible to receive. a Request for Advance Ruling: By checking this box and signing the consent, pursuant to section 6501 (c)(4) of the Code you request an advance ruling and agree to extend the statute of limitations on the assessment of excise tax under section 4940 of the Code. The tax will apply only if you do not establish public support status at the end of the 5-year advance ruling period. The assessment period will be extended for the 5 advance ruling years to 8 years, 4 months, and 15 days beyond the end of the first year. You have the right to refuse or limit the extension to a mutually agreed-upon period of time or issue(s). Publication 1035, Extending the Tax Assessment Period, provides a more detailed explanation of your rights and the consequences of the choices you make. You may obtain Publication 1035 free of charge from the IRS web site at www.irs.gov or by calling toll-free 1-800-829-3676. Signing this consent will not deprive you of any appeal rights to which you would otherwise be entitled. If you decide not to extend the statute of limitations, you are not eligible for an advance ruling. 0 0 Ill 0 0 0 For Organization (Signature of Officer, Director, Trustee, or other authorized official) (Type or print name of signer) (Date) (Type or print title or authority of signer) For IRS Use Only iRS Oiiector~ -EXempt o,.g-ariii:StiOi-iS.- ..o -... --- ... -.o -oo -.-.- .......... ----- .. -- ..oo.o. -.... -... --.-. -?-.-.-... (Dat8)- ... -.- ..... -... -.. b Request for Definitive Ruling: Check this box if you have completed one tax year of at least 8 full months and you are requesting a definitive ruling. To confirm your public support status, answer line 6b(0 if you checked box g in line 5 above. Answer line 6b(ii) if you checked box h in line 5 above. If you checked box i in line 5 above, answer both lines 6b(Q and (iQ. D (i) (a) Enter 2% of line 8, column (e) on Part IX-A Statement of Revenues and Expenses. (b} Attach a list showing the name and amount contributed by each person, company, or organization whose gifts totaled more than the 2% amount. If the answer is "None," check this box, (ii) (a) For each year amounts are included on lines 1, 2, and 9 of Part IX-A Statement of Revenues and Expenses, attach a list showing the name of and amount received from each disqualified person. If the answer is "None," check this box. (b) For each year amounts are included on line 9 of Part IX-A. Statement of Revenues and Expenses, attach a list showing the name of and amount received from each payer, other than a disqualified person, whose payments were more than the larger of (1) 1% of line 10, Part IX-A. Statement of Revenues and Expenses, or (2) $5,000. If the answer is "None," check this box. 0 0 7 Did you receive any unusual grants during any of the years shown on Part IX-A. Statement of Revenues and Expenses? If "Yes," attach a list including the name of the contributor, the date and amount of the grant, a brief description of the grant, and explain why it is unusual. 0 Yes 0 Iii No Form 1023 (Rev. 6-2006) fSO Form 1023 (Rev. 6?2006) Name: J". Project Veritas EIN: 27- 2894856 Page 12 I:&Ji:JI User Fee Information f You must include a user fee payrrient with this application. It will not be processed without your paid user fee. If your average annuaJ gross receipts have exceeded or will exceed $10,000 annually over a 4-year period, you must submit payment of $750. If your gross receipts have not exceeded or will not exceed $10,000 annually over a 4-year period, the required user fee payment is $300. See instructions for Part XI, for a definition of gross receipts over a 4-year period. Your check or money order must be made payable to the United States Treasury. User fees are subject to change. Check our website at www.irs.gov and type "User Fee" in the keyword box, or call Customer Account Setvices at 1-877-829-5500 for current information. 1 Have your annual gross receipts averaged or are they expected to average not more than $1 0,000? If "Yes," check the box on line 2 and enclose a user fee payment of $300 (Subject to change-see above). If "No," check the box on line 3 and enclose a user fee payment of $750 (Subject to change-see above). Check the box if you have enclosed the reduced user fee payment of $300 (Subject to change). Check the box if you have enclosed the user fee payment of $750 (Subject to change). 0 0 Yes Ill D lil No 2 3 ~~?? ~~~-~-~-?c~-- -~-~~~~~-~~~-==-?-~? ~:~;-~;;_:~-~-~-~~~~~=~~-comii.~_\.'.~-------r Here (Signature o I declare under the penafti~esry that I am authorized to sign thts application on behaH of the above organization and that 1 have examined this _ , Director, Trustee, or other (Type or print name of signer) (Date) authorized 0 "al) -~~!-~!"?. ------------------------------------(Type or print title or authority of signer) Reminder: Send the completed Form 1023 Checklist with your filled-in-application. Fonn 1023 (Rev. 6-2006r Project Veritas ATTACHMENTS FOR FORM 1023: EIN: 27- 2894856 APPLICATION FOR RECOGNITION OF EXEMPTION Part IV: Narrative Description of Activities The mission of Project Veritas is to investigate and expose corruption, dishonesty, selfdealing, waste, fraud, and other misconduct in both public and private institutions in order to achieve a more ethical and transparent society. Project Veritas will engage in three primary activities: (!)Conducting investigations into possible official corruption and misconduct; (2) Publicizing the results of our investigations; and ?(3) Training citizen journalists to do conduct similar investigative journalism in their states and communities. The first two primary activities are the direct means by which we will achieve our exempt purpose, as described in the paragraph above. The third primary activity will leverage our expertise to train others to conduct achieve our exempt purpose in their communities. Our purpose is the discovery and exposition of true information so that society can function in a more efficient, knowledgeable manner, and make decisions based on the most possible accurate information. To date, the organization has not conducted any program activities. Initially, our activities will be conducted by our founder or our executive director. As we raise funds, we expect to hire additional staff. Our office is in Arlington, Virginia. However, many of our activities will take place in the country, depending on the project and on funding available. Our activities will be funded by donations. We may charge a fee for our training sessions. During the second half of this year, we expect to conduct three to six investigative journalism projects, with each one taking one or two months to complete. We expect this to take about 40% of our staff time. We will then publicize the results of these investigations, through a website, press releases, press conferences and other media. The amount of time devoted to publicizing the results will depend on the results, but we expect it will take about 20% of our staff time. We also expect to conduct about 5 training sessions, in five different states. The first one will be in September. The sessions are expected to be 2-3 day training sessions. We expect developing the curriculum and conducting these initial trainings will take about 20% of our staff time. We expect the remaining 20% of our staff time to be devoted to fund-raising and administrative matters. Part V.lb: Independent Contractors The organization expects to hire independent contractors to provide assistance with several functions, including website development and maintenance, public relations, fundraising, accounting and legal matters. Some of those independent contracts may be paid more than $50,000 per year. However, the organization has not yet signed contracts with any independent contracts and does not expect to do so before ioitial funds have been raised to pay such contractors. 1 Project Veritas Part V .3a: Officers, Directors, etc. EIN: 27- 2894856 Name & Title Maureen Wagner, Chair Duties & Qualifications Provide guidance and oversight as a board chair of the board. Qualifications include experience gained working for another nonprofit. Provide guidance and oversight as a board member. Qualifications include experience in ethics and leadership gained as a priest. Provide guidance and oversight as a board member. Qualifications include experience gained in developing and serving as executive director of this organization. Provide guidance and oversight as a board member. Qualifications include experience gained as working professional! y as the director of development for a nonprofit. Hours worked weekly Less than 5 Gregory Levitsky, President Less than 5 Isabel Santa, Secretary 40+ Francisco Gonzales, Treasurer Less than 5 Part V.6a and 6b: Bonuses and Compensation Staff of the organization will receive fixed salaries. We expect that, if funding is available, and based on performance, some employees may receive discretionary bonuses at year-end. With respect to independent contractors, the organization expects most such contracts to provide for fixed compensation, but the organization may enter into agreements with independent contractors for services and with outside fund-raisers to assist with fund-raising under arrangements that may include non-fixed compensation and/or bonuses based on performance. Part VIII.4a. Fundraising 4a. Initially, fundraising efforts will be focused on major donors who express interest in our work. The organization expects to use dinners, individual meetings, mail, email and phone solicitations to raise funds. We may receive some donations through the organization's website. We may apply for grants from foundations that share our vision. 4b. The organization does not currently have any such contracts, but may in the future. 4d. Initial fundraising efforts will occur in Virginia, and then in other states as we have opportunities. 2 Project Vcritas EIN: 27- 2894856 Part VIII.lO. Intellectual Property The organization will write investigative reports, new stories, training materials and other written and video works, and will hold copyright in the writings and videos and other works. While we expect primarily to make them available for free use by newspapers and other media outlets, we may charge a fee for use of some information, or compile it into books or reprints for sale as appropriate. Part IX.23. Other Expenses Item Training programs Website and PR Travel General office I admin 2010 40,000 25,000 20,000 20,000 105,000 2011 80,000 50,000 30,000 50,000 210,000 2012 110,000 80,000 45,000 60,000 295,000 Total 3 - -- . STATE CoRPORATION CoMMISSION c.Rjclimond; June 22, 2010 T!iis is.to certify tfiat tlie certificate of incorporation Of Project Veritas . was t/iis cfay issuea ancf acfmittecf to recora in t/i?.5 office aiuftfzat .: .i!U. saU corporation is aut/iorizecf to tran:sact its_ o6tifiness)u.BJe~t . to a[[1Jirginia faws appCica6fe to tfie corporation-anti its BUSiness. ? P.ffective cfate: June 22, 2010 State Corporation Commission jl.ttest: ?- - .. CIS0328 80"d ~S96LL8~os:xe_, S3JIAM3S 1~031 COMMONWEALTH OF VIRGINIA STATE CORPORATION COMMISSION ARTICLES OF INCORPORATION VIRGINIA NONSTOCK CORPORATION The undersigned, pursuant to Chapter 10 of Title 13.1 of the Code of Virginia, states as follows: I. The name of the corporation is: Project Veritas. 2. The corporation shall have no members. 3. The directors shall elect their successors. 4. The name of the corporation's initial registered agent is Isabel M. Santa, an indiv.idual who is a resident of Virginia and an initial director of the corporation. 5. The corporation's initial registered office address, which is identical to the business office of the initial registered agent, is: 1922 N Quincy St Arlington, VA 22207. The registered office is physically in the city of Arlington. 6. The initial directors are: a. Maureen Wagner. 1922 N Quincy St Arlington, VA 22207. b. Francisco Gonzales. 1922 N Quincy St Arlington, VA 22207. c. Gregory W. Levitsky. 1922 N Quincy St Arlington, VA 22207. d. Isabel M. Santa. 1922 N Quincy St Arlington, VA 22207. 7. The purpose or purposes for which the corporation is formed are: This organization is organized exclusively for charitable, religious, educational and scientific purposes under section 50l(c)(3) of the Internal Revenue Code, or corresponding section of any future federal tax code, including for the purpose of investigating and exposing corruption at all levels and other misconduct in order to achieve a more ethical and transparent society. 8. No part of the net earnings ofthe Corporation shall inure to the benefit of or be distributable to any director or officer of the Corporation, or to any other private person, except that the Corporation shall be authorized and empowered to pay reasonable compensation for services rendered to or for the Corporation and to make payments and distributions in furtherance of the purposes set forth above. A. In the event of dissolution or final liquidation of the Corporation, all remaining assets and property shall, after paying or making provision for the payment of all of the liabilities and obligations of the Corporation and for necessary expenses thereof, be distributed to such organization or organizations as chosen by the board of directors that are organized and operated exclusively for social welfare, public benefit, charitable or educational purposes and exempt under section 50!(c)(3) of the Code. In no event shall any of such assets or property be distributed to any director or officer or any private individual. B. No substantial part oftbe activities of the corporation shall be the carrying on of propaganda, or otherwise attempting to influence legislation, and the corporation shall not participate in or intervene (including the publishing or distribution of statements) any political campaign on behalf of (or against) in any candidate for public office. Notwithstanding any other provision of these Articles, the corporation shall not carry on any activities not permitted to be carried on by a corporation exempt from federal income tax under Section 50i(c)(3) of the Internal Revenue Code, or the corresponding provisions of any future federal tax code.) 9. In any proceeding brought by or in the right of the corporation, or by or on behalf of members of the corporation, no officer or director shall be liable for any damages arising out of any one or more transactions, occurrences, or courses of conduct. The preceding sentence shall not apply to any transaction, occurrence, or course of conduct with respect to which the officer or director engaged in willful misconduct or in knowing violation oftbe criminal law or federal or state law. DATE Exhibit A BY-LAWS Project Veritas A Virginia Nonprofit Corporation ARTICLE I. OFFICES Section I .01 Offices. The Corporation shall have its registered office in the state in which it is incorporated, and may have such other offices and places of business within or without such state as the Board of Directors may from time to time determine or the business of the Corporation may require. ARTICLE II DIRECTORS Section 2.0 I Board of Directors. The management of the affairs, property and business of the Corporation shall be vested in a Board of Directors. Section 2.02 Number. The number of directors shall be three, or more as fixed from time to time by the Board of Directors. Section 2.03 Term of Directors. Each director shall hold office until the expiration of such term and until his successor, if any, has been elected and qualified, or until his earlier resignation or removal. Section 2.04 Election of Directors. Annual and Regular Meetings. The annual meeting of directors shall be held on such date as may be determined by the Board of Directors. At such meeting, the directors shall elect a Board of Directors and transact such other business as may properly come before the meeting. Regular meetings of the Board of Directors may be held at such times as the Board of Directors may from time to time determine. No notice shall be required for the annual or any regular meeting of the Board of Directors. Section 2.05 Special Meetings. Special meetings of the Board of Directors may be called by the President, by an officer of the corporation who is also a director or by any two directors, upon one day's notice to each director either personally or by mail, email, telephone, telecopier or telegraph, and if by telephone, confirmed in writing before or after the meeting, setting forth the time and place of such meeting. Notice of any special meeting need not be given, however, to any director who submits a signed waiver of notice, before or after the meeting, or who attends the meeting without objecting to the transaction of business. Section 2.06 Place of Meetings. (a) The Board of Directors may hold its meetings, regular or special, at such places, either within or without the state in which it is incorporated, as it may from time to time determine or as shall be set forth in any notice of such meeting. (b) Any meeting of the Board of Directors may be held by means of conference telephone or similar communications equipment whereby all persons participating in the meeting can hear each other, and such participation shall constitute presence at the meeting. Section 2.07 Adjourned Meetings. A majority ofthe directors present, whether or not a quorum, may adjourn any meeting of the Board of Directors to another time and place. Notice of such adjourned meeting need not be given if the time and place thereof are announced at the meeting at which the adjournment is taken. Section 2.08 Quorum of Directors. A majority of the total number of directors shall constitute a quorum for the transaction of business. The total number of directors means the number of directors the Corporation would have ifthere were no vacancies. Section 2.09 Action of the Board of Directors. The vote of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, unless the question or action is one upon which a different vote is required by express provision of statute, the Certificate of Incorporation or these By-Laws, in which case such provision shall govern the vote on the decision of such question or action. Each director present shall have one vote. Section 2.10 Action by Written Consent of Directors. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if a written consent thereto is signed by all members of the Board of Directors or of such committee, and such written consent is filed with the minutes of proceedings of the Board of Directors or committee. Consent may be given by email. Section 2.11 Resignation. A director may resign at any time by giving written notice to the Board of Directors, the President or the Secretary of the Corporation. Unless otherwise specified in the notice, the resignation shall take effect upon receipt by the Board of Directors or such officer, and acceptance of the resignation shall not be necessary. Section 2.12 Removal of Directors. Any or all of the directors may be removed with or without cause by majority vote of the directors. Section 2.13 Vacancies. Vacancies occurring in the Board of Directors for any reason may be filled by a vote ofthe majority of the directors then in office, although less than a quorum. A director elected to fill a newly created directorship or to fill any vacancy shall hold office until the next annual meeting of directors, and until his successor, if any, has been elected and qualified. Section 2.14 Chairman. At all meetings of the Board of Directors the Chairman of the Board or, if one has not been elected or appointed or in his absence, a chairman chosen by the directors present at such meeting, shall preside. Section 2.15 Committees Appointed by the Board of Directors. The Board of Directors may, by resolution passed by a majority of the entire Board of Directors or by written consent of all of the directors, designate one or more committees, each committee to consist of one or more of the directors. The Board may also designate one or more directors as alternate members of any committee who may replace any absent or disqualified committee member at any committee meeting. Any such committee, to the extent provided in the resolution, except as restricted by law, shall have and may exercise the powers of the Board of Directors in the management of the affairs, business and property of the Corporation, and may authorize the seal of the Corporation, if any, to be affixed to all papers which may require it. Section 2.16 Compensation. Unless otherwise restricted by law, the certificate of incorporation or these Bylaws, the Board of Directors shall have the authority to fix the compensation of 2 directors. No such compensation shall preclude any director from serving the corporation in any other capacity and receiving compensation therefore. ARTICLE III OFFICERS Section 3.01 Offices, Election and Term. (a) At its annual meeting the Board of Directors shall elect or appoint a President and a Secretary and may, in addition, elect or appoint at any time such other officers as it may determine. Any number of offices may be held by the same person. (b) Unless otherwise specified by the Board of Directors, each officer shall be elected or appointed to hold office until the annual meeting of the Board of Directors next following his election or appointment and until his successor, if any, has been elected or appointed and qualified, or until his earlier resignation or removal. (c) Any officer may resign at any time by giving written notice to the Board of Directors, the President or the Secretary of the Corporation. Unless otherwise specified in the notice, the resignation shall take effect upon receipt thereof, and the acceptance of the resignation shall not be necessary to make it effective. (d) Any officer elected or appointed by the Board of Directors may be removed by the Board of Directors with or without cause. Any vacancy occurring in any office by reason of death, resignation, removal or otherwise may be filled by the Board of Directors. Section 3.02 Powers and Duties. The officers, agents and employees of the corporation shall each have such powers and perform such duties in the management of the affairs, property and business of the Corporation, subject to the control of and limitation by the Board of Directors, as generally pertain to their respective offices, as well as such powers and duties as may be authorized from time to time by the Board of Directors. ARTICLE IV INDEMNIFICATION Section 4.01 Indemnification. The Corporation shall indemnifY the directors and officers and may, by action of the Board of Directors, indemnifY its agents and employees in the manner and to the full extent provided in the laws of the state of in which it is incorporated. Such indemnification may be in addition to any other rights to which any person seeking indemnification may be entitled under any agreement, vote of directors, any provision of these By-Laws or otherwise. The directors, officers, employees and agents of the Corporation shall be fully protected individually in making or refusing to make any payment or in taking or refusing to take any other action under this Article in reliance upon the advice of counsel. Expenses incurred in defending any action or proceeding for which indemnification is required or permitted and authorized by the Board of Directors shall be paid by the corporation in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of the indemnified party to repay such amount if it shall ultimately be determined that the indemnified party is not entitled to be indemnified as authorized in this Article. 3 ARTICLEV MISCELLANEOUS Section 5.01 Corporate Seal. The corporation shall not have a corporate seal. Section 5.02 Execution of Instruments. All corporate instrwnents and documents shall be signed or countersigned, executed, and, if desired, verified or acknowledged by a proper officer or officers or such other person or persons as the Board of Directors may from time to time designate. Section 5.03 Fiscal Year. The fiscal year of the Corporation shall be from January I through December 31, or as otherwise determined by the Board of Directors. ARTICLE VI AMENDMENTS Section 6.01 Amendments. These By-Laws may be altered, amended or repealed from time to time by the directors. 4 Exhibit B Conflict of Interest Policy Article I. Purpose. The purpose of the conflict of interest policy is to protect this tax-exempt organization's (Organization) interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director of the Organization or might result in a possible excess benefit transaction. This policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and charitable organizations. Article II. Definitions I. Interested Person. Any director, principal officer, or member of a committee with governing board delegated powers, who has a direct or indirect financial interest, as defined below, is an interested person. 2. Financial Interest. A person has a financial interest if the person has, directly or indirectly, through business, investment, or family: a. An ownership or investment interest in any entity with which the Organization has a transaction or arrangement, b. A compensation arrangement with the Organization or with any entity or individual with which the Organization has a transaction or arrangement, or c. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Organization is negotiating a transaction or arrangement. Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial. A financial interest is not necessarily a conflict of interest. Under Article III, Section 2, a person who has a financial interest may have a conflict of interest only if the appropriate governing board or committee decides that a conflict of interest exists. Article III. Procedures 1. Duty to Disclose. In connection with any actual or possible conflict of interest, an interested person must disclose the existence of the financial interest and be given the opportunity to disclose all material facts to the directors and members of committees with governing board delegated powers considering the proposed transaction or arrangement. 2. Determining Whether a Conflict of Interest Exists. After disclosure of the financial interest and all material facts, and after any discussion with the interested person, he/she shall leave the governing board or committee meeting while the determination of a conflict of interest is discussed and voted upon. The remaining board or committee members shall decide if a conflict of interest exists. 3. Procedures for Addressing the Conflict of Interest a. An interested person may make a presentation at the governing board or committee meeting, but after the presentation, he/she shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest. b. The chairperson of the governing board or committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement. c. After exercising due diligence, the governing board or committee shall determine whether the Organization can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest. d. If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the governing board or committee shall determine by a majority vote ofthe disinterested directors whether the transaction or arrangement is in the Organization's best interest, for its own benefit, and whether it is fair and reasonable. In conformity with the above determination it shall make its decision as to whether to enter into the transaction or arrangement. 4. Violations of the Conflicts of Interest Policy a. If the governing board or committee has reasonable cause to believe a member has failed to disclose actual or possible conflicts of interest, it shall inform the member of the basis for such belief and afford the member an opportunity to explain the alleged failure to disclose. b. If, after hearing the member's response and after making further investigation as warranted by the circumstances, the governing board or committee detern1ines the member has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action. Article IV. Records of Proceedings. The minutes of the governing board and all committees with board delegated powers shall contain: a. The names of the persons who disclosed or otherwise were found to have a financial interest in connection with an actual or possible conflict of interest, the nature of the !inancial interest, any action taken to determine whether a conflict of interest was present, and the governing board's or committee's decision as to whether a conflict of interest in fact existed. b. The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings. Article V. Compensation a. A voting member of the governing board who receives compensation, directly or indirectly, from the Organization for services is precluded from voting on matters pertaining to that member's compensation. b. A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Organization for services is precluded from voting on matters pertaining to that member's compensation. c. No voting member of the governing board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Organization, either individually or collectively, is prohibited from providing information to any committee regarding compensation. Article VI. Annual Statements. Each director, principal officer and member of a committee with governing board delegated powers shall annually sign a statement which affinns such person: a. Has received a copy of the conflicts of interest policy, b. Has read and understands the policy, c. Has agreed to comply with the policy, and d. Understands the Organization is charitable and in order to maintain its federal tax exemption it must engage primarily in activities which accomplish one or more of its tax-exempt purposes. Article VII. Periodic Reviews. To ensure the Organization operates in a manner consistent with charitable purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted. The periodic reviews shall, at a minimum, include the following subjects: a. Whether compensation arrangements and benefits are reasonable, based on competent survey information, and the result of arm's length bargaining. b. Whether partnerships, joint ventures, and arrangements with management organizations conform to the Organization's written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes and do not result in inurement, impermissible private benefit or in an excess benefit transaction. Article Vlll. Use of Outside Experts When conducting the periodic reviews as provided for in Article VII, the Organization may, but need not, use outside advisors. Tf outside experts are used, their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are conducted. Annual Conflict of Interest Statement Conflicts to be disclosed below (if none, write ~none"): Ncn-e- _ Commonwealth of Virginia ? ?State? Corporation Commission Clerk's Office ' ~300E. o ~3219 ___ Main St., Tyler llldg., Richmond, YA Facsimile Cover Sheet ... -~~--~----~--- Company: Project Veritas Phone: (512) 658-4241 Fax: (512) 233-2246 To: Kate Donor From: Jarr~es Anth-::o_n.J._y_~--~ Phone: {804) 371- 9018 Fax: j804) 371- 9654 Data: June 22, 2010 Pages including this - ;cover page: _,3::____ _ _ _ _ _ _ _ __ Comments: 1 - Filing receiP! . . - Certificate of Incorporation 1 lO . d Ll'?l OlOl ll unr VS96lL8V08:XBj S3:J I AH3S lV831 COMMONWEALTH OF VIRGINIA STATE CORPORATION COMMISSION Office of the CJerk June 22, 2010 KATE DONER 815 BRAZOS STE 701 AUSTIN, TX 78701 RECEIPT RE: Project Veritas ID: DCN: 0724771 - 1 10-06-22-1100 Dear Customer: This is. your receipt for $75.00, to cover the fees for filing articles of incorporation 'iVilh this office. This is also your receipt for $225.00 to cover the fee(s) for expedited service(s). The effective.date of the certificate of incorporation is June 22, 2010. if you ~~ve any questiims; please call (804) 371-9733 or toll-free in Virginia; ?1-866~722-2551: . . . Sincerely, ? ?? Joel H. PecK ClerK of the Commission CORPRCPT NEWCD CIS0328 Clerk's Of1ic:o (804) 371?9'133 Qr (86~) 722-2561 (tolWree In VIrginia) www.scc.vlrglnia.gov'feJk Toteoommuni~ons Davlca for the Deaf-TDDNoic:s: (804) 311-9206- ? ? ? P.O. sox 1.197, Richmond, VA 23218-1197 Tyrer "uilding, First Floor, 1300 Eut Sb'Ht, Richmond, VA 23219-3.630 ,_in zo .d LZ'8l OLOZ ZZ unr l1~96lL8l108:XBo STATE CoRPORATION CoMMISSION CJ?jcfimoncf, June 22, 2010 Tliis is to certify tliat tfie certificate ofincorporation of Project Veritas ' : .: '?10-! tliis cfay issuea ana aamittecf to recorcf in tliis office ait_tf~fiat :? _ffie~ saicf corporation is autliorizet{ to tran_sact its o6tifi.nes(Sy-6je~ .. to flff1/irginia faws appficaGfe to tlie corporation-ana its BUSiness. ? .P.ffectipe aate: June 22, 2010 State Corporation Commission jlttest: .. - .. CIS0328 80 .d Ll'8l OLOl ll unr 17S96LL81708:xej 'Ire~ }ll'SUlft toGiaJ:tec 10 ctTnle 13.1 crtre GxieofVirgiria, stties a> fdlf:mai oociely. 8. N:> ran crtre net eaning> c?tre cYtre CltjXXaicnaxJ.fcr I " 't"SSdlyeq:Hl'lts ~ re di.strib.nrltosu:h~mcr~ms a> drsencytre lnlrdcrcir:wus that are crgri2e:iarrlqeatrl~:Kr mal w'.l.fure, p1::lic berdit:, d:mi.utiecr uch cancellation shall be made by a o written notice of cancellation mailed to the Chairman of A1f A, 9625 Surveyor Court, Suite 400, Manassas, VA 20110, and shall be deemed effective when deposited in the United States Mail, properly addressed and postage prepaid, unless otherwise inconsistent with the terms ofthe Agreement. Client shall also mail a copy of such written cancellation to: Office of the Attorney Geneml, The Capital, Albany, NY 12224. 3. This Addendum shall be effective upon the date of the Agreement, and shall be construed and applied with respect to, or within, the State of New York only, and shall not otherwise affect the respective parties rights and obligations under the Agreement as to any other state. nor do the parties waive application of the laws oftbe Commonweahh of Virginia to the Agreement,. nor shall this constitute or be deemed a waiver of jurisdiction. venue. rights~ claims, causes of action, or defenses by either party, nor shall this be deem~d to construe jurisdiction or venue in the State ofNew York. This Addendum is to be read and construed consistent with the rights of the parties or of either party under the principal Agreement, the Commerce Clause of the United States Constih1tion, or any other rights including those under the United States Constitution and Virginia law. 4. In the event that the controlling New York law, and in particular, Section I 74..a, is deemed null and void, or unconstitutional, this Addendum shaH be deemed null and void. Seen, agreed and accepted: By:_~~~ American Target Advertising, Inc. Client: The Project Veritas Date: 3 - '3 - 2.0 Jj (I S"wear under penAlties of perjury, the contract submitted is an accurate and complete copy of the contract addendum). By: Date: Mark J. Fitzgibbons Mar 08 11 05:36p K.ate Doner- 512-233-2246 p.4 ADDENDUM TO AGREEMENT FOR PURPOSES OF PENNSYLVANIA ON I> Y American Target Advertising, Inc. (ATA) and The Project Veritas (Client) enter into this Addendum to Agreement for purposes of complying with the Pennsylvania charitable solicitations registration laws in effect as of the date of this Addendum. 1bis Addendum shall not affect the tenns of the Agreement as it applies to the other 49 states. In the event that the current Pennsylvania law shall be deemed null and void, this Addendum shall likewise be deemed null and void. This Addendum shall not otherwise affect the terms of the Agreement between the parties. This Addendum shall not be deemed a waiver of applicability of Virginia Jaw to the Agreement, nor shall it be deemed to confer jurisdiction or venue in the State ofPennsylvania, nor shall it be deemed a waiver of any rights of either party or both parties, nor shall it be deemed as a waiver of any claims, causes of action or defenses . o 1. The effective date of the Agreement and the date services will be_.gin with respect to communications and solicitations mailed into Pennsylvania by Clicrtt shall be tbe date on which Pennsylvania Bureau of Charitable Organizations has approved the Agreement. 2. ATA shall not at any time have custody or control of contributions. 3. Client exercises control and approval over 1he content and volume of any solicitation. Seen, agreed and accepted: American Target Advertising, Inc. By:~(.&!~. Client: The Project Verit"" By: Date: ~-8- 201( _2,,.o~ Date: .. Date: )-r- 2vi I By: _________________ ----- Har 08 II OS:JSp Kate Doner 512-233-2246 p.l AGREEMENT This Agreement is made and entered into iliis _8 _ _ day of _March_, 20 II, by and between American Target Advertising, Inc. ("ATA"), a Virginia direct marketing agency located at 9625 Surveyor Court, Manassas, Virginia, 20110, and The Project Veritas ("Client") a 501(c)(3) nonprofit organization whose principal address is _815 Brazos, Suite 70 l, Austin, Texas 7870 I. WHEREAS, Client is an organization engaged in nonprofit services, advocacy and education for its nonprofit mission: is to investigate and expose corruption, dishonesty, self-dealing, waste, fraud, and oilier misconduct in both public and private institutions in order to achieve a more ethical and transparent society. WHEREAS, Client desires to retain the Internet direct marketing and consulting services, and advice on Client's membership, advocacy, fundraising, communications, public education programs and legal expesnses, and generally help to build a base of supporters for Client. ' o NOW, TIIEREFORE, in consideration of the premises and of the mutual covenan~~ and agreements contained herein, it is agreed as follows: Section 1. INDEPENDENT RELA TIONSJllP Client retains ATA as its non-exclusive consultant to Client's Internet direct response communications and fundraising, and to its educational programs subject to the terms and conditions of this Agreement. ATA is an independent conlractur and no officer, director or employee of ATA shall serve as an officer or director of Client during the term of this Agreement. Section 2. ATA SERVICES A. Client retains A TA to act as its non-exclusive Internet direct marketing consultant in the Client's educational, advocacy, communications and fundraising programs which acquirt> and communicate with supporters and donors, and generally educate the public to the Client's projects and objectives, which also create a Jist of individuals and information (including e-mail addresses) hereinafter referred to as the Client "Housefile." B. ATA shall provide to Client planning, creative and other services that may include "'Titing copy, identifYing email lists, use of electronic and other media and such other services as may be required under this Agreement. After consultation with and written approval hy Client, ATA will propose: plans and recommend actions for Client to use in its cornmunicatio11s, design and content of material and when such material should be emailed or adverlised. AT A agrees to supervise the implementation of such work as disclosed agent lor Client, wheth~r performed directly, through affiliates, or through independent suppliers. -?------ --------- Mar 08 II 05:16p Kate Doner 5I2-233-2246 p.2 C. All written copy prepared for Clio:nl by A TA and proposed costs shall be submitted to Client tor review prior to production of materials. If Client approves an email plan and budget, but then revokes it, Client shall pay for hard costs incurred by ATA in rdiance ob Client's initial approval (e.g., lists). Communications to supporters or potential supporters may not be sent or disseminated without written approval by Client. All packages must be approved by Client prior to being communicated. ATA shall not solicit on behalf of Client. D. The parties recognize that the tax-exempt mission of the Client includes grassroots education and advocacy. To that end, communications conducted under this Agreement shall constitute a primary program element for Client, even if such communications contain appeals for contributions. Therefore, the program conducted hereunder shall consist primarily of direct marketing, and net income may be used for that pwpuse as a program expense. Section 3. SUPPLIERS . ATA, as disclosed agent for Client, may order services and materials from third-party vendors and suppliers, and provide or secure loans or advances to pay costs of the program on behalf of Client, consistent with the Plans approved by Clienl Client shall be invoiced by vendors and suppliers, including ATA, for tees and actual costs of goods and services, but care of ATA. ATA may make or arrnnge for prepayments, and all such advances shall be billed back to the program and paid out of escrow like all other supplier invoices. ATA shall advance costs of registering under state charitable solicitation law, which shall be billed back as costs herein. Except as provided in Section 8.B. herein, Client's responsibility for payment for goods and services nnder this Agreement shall not exceed the total amount of funds raised under this Agreement, and ATA shall indemnifY and hold Client harmless from any liability for any remaining unpaid balance of expenses resulting from any goods and services provided by any vendors and suppliers under this Agreement. Set:tion 4. ESCROW ACCOUNT A. Client shall have exclusive rights to control, manage and exercise dominion and control over any funds raised from programs conducted under this agreement. Under the parameters set forth in subsection C below, funds generated to pay costs of the program will be deposited into an Escrow Account, and disbursed by an Escrow Agent selected mutually by Client and ATA. B. The Escrow Agent shall disburse funds raised hereunder to pay all costs of the Client's programs under this Agreement. The Escrow Agent shall disburse payments periodically (usually weekJy) based on the procedures established in this subsection, unless otherwise set forth in vendor agreements, after Client has approved the copy and plans as provided in Section 2, above, without furtho:r need of approval by Client. Client may not disapprove disbursements under this Section 4 as long as the copy and projected approximate costs were previously approved by Client pursuant to Section 2. 2 ??---?--- Mar 08 11 05: 16p Kate Doner 5!2-233-2246 p.3 C. (!)For Client's own website developed independent of this Agreement, Client shall use 20 percent of income from contributions to that website to pay costs and ftes billed under this Agreement via the Escrow Agent, and Client shall keep the remaining 80 percent. (2) For the Client's website{s) developed using ATA's services, 50 percent of income after hard costs from contributions to that website shall be used to pay costs and fees billed under this Agreement, and Client shall be paid the remaining 50 percent, both via the Escrow Agent. Hard costs include list rental, banner ads, keyword search fees, and housefile email blasts, but not state registration costs or professional public relations fees. Section 5. ATA's FEES o A. Internet. Client shall pay ATA (I) $.006 for each prospecting email sent and $.015 for each housefile email aent; (2) $500 per each donation landing page created by Al"A, approved by Client ,.;,d implemented; (3) $2,500 per unique prospect package o created and sent; (4) $1,000 for each dire6t mail package converted to email and sent; (5) $500 per thank-you package created and sent; (6) a retainer fee of$7,500. B. Other Communications. Client shall pay ATA a mark-up of twenty percent for any goods and/or services for other forms of communication not subject to, or identified in, Section 5.A, that ATA buys, contracts or acquires on behalf of and for Client and under this Agreement (for example, banner ads, keyword search, media buys, newspaper editorial ads, etc.). Section 6. LIST BROKERAGE ATA, its affiliates, assigns or designees shall be the exclusive list broker for email addresses and other information which are being rtnted or otherwise acquired for Client's programs under this Agreement. The list broker shall charge a commission fee of twenty percent (20%) of the gross li>l rental cost or exchange value of each name, address or associated information. Section 7. LIST OWNERSHIP AND SECURITY INTEREST A. Each and every name, address and related data of persons that are obtained, developed, compiled, contacted or otherwise made aware of Client, by or through the direct effort of ATA in connection with any services rendered by AT A to Client pursuant to the tenus herein, shall at all times be and constitute the Housefile which shall be the property of Client. B. As and for partial consideration under this Agreement. AT A shall own a copy of the Housefile with all ownership rights to its copy, including the rights to market, rent, sell, exchange or otherwise transfer (collectively "market") its copy. 3 ??------~?---?----------- -?--- ---- -????-- -----~ Mar 08 II 05:17p Kate Doner 512-233-2246 p.4 Section 8. OWNERSHIP OF INFORMATION AND MATERIALS A. Any sites that are developed and/or prepared by ATA will be owned by Client following expiration of this Agreement. B. Should Client mail or disseminate a package written or substantially written by ATA during or after tlris Agreement, Client shall pay ATA half the lee per communication sent set forth in Section 5 above .. Section 9. TERM AND SURVIVAL A. Term. This Agreement shall have a term of 30 days. E. Survival. It is expressly understood and agreed that Sections 3, 6, 7, 8, 9, 10, II and 12 of this Agreement shall survive any rermination, cancellation breach of this Agreement and shall remain binding upon the Parties hereto. o o Section lO. CONFIDENTIALITY Client and ATA hereby agree to keep confidential this Agreement and all correspondence, reports, information and communications (hereinafter "Jnformation") by and between the parties hereto. ATA and Client hereby agree to use Jnforrnation provided by either party to the other only for projects conducted herein and not to sell, trade or otherwise disseminate to third parties such Jnforrnation, except as may be required for reporting purposes to regulating government agencies and/or organizations or as otherwise herein permitted. Client also acknowledges that during the oourse of the Agreement, Client will be exposed to AT A's trade se~'fets and other proprietary information. which Client may not disclose even for reporting purposes or pursuant to legal process including but not linnted to litigant- or government-compelled disclosure without the prior written consent of ATA 's Chairman or Pre:;ident. Section 11. GOVERNING LAW AND COMPLJANCE This Agreement shall be governed by the laws of the Commonwealth of Virginia. In the event any provision of this Agreement is deemed void by a court or proper and competent legal tribwml with legal jurisdiction, that provision shall be deemed severed from tlris Agreement in the respective jurisdiction only. 4 M.ar 08 11 05: 17p Kate Doner 512-233-2246 p.5 I above. The parties hereto have executed this Agreement offecLive on d1e date first set forth cuENT: Yro~ Yer~-ks Date: By:r\?.=W~ Print name and title; .3- E9-Z.otJ KU..-\-h?EUR.'1\ Y\-e_ \,1\). }),(\e:g_ :__ Ac.-il~ Ex~. lir~d"b~ AMERlCAi'i TARGET ADVERTISING, INC. By:_'____ Dal~: o Print name and title: _ _ _ _ _ _ _ ? - - - ? - - - - - - 5