Hello again,

It has been awhile since I have done a GIMP Foundation update. There is quite a bit that must be decided on at this point. Also, people need to decide how invovled they would like to be.

Summary: My Goals,
Benefits of incorporation
responsibilites of those invovled
things to be decided
looking for help
What the organization can do

MY GOALS First off, let me go over several of my personal goals for The GIMP and then I will try and show now TGF can be used to develop these goals.

My goals for The GIMP really boil down to three things. First, I really want to see The GIMP to be a household name for professional image editors. Second, I want to the GIMP as easy as possible for volunteers to contribute to. Third, I want to be able to turn The GIMP into a real, paid, career for a team of people, including myself.

As such I have been trying to further these goals by creating TGF, soliciting funding, and trying to come up with ways of using that funding to further these goals.

Let me make perfectly clear that my important priority is to make sure that our existing volunteer developers are, in no way, givin any additional responsibilites or risks that he/she did not ask for. I do not want (nor do I think it is possible) to try and "control" or "be in charge" of our existing volunteer developers. No one, though my actions or those of The GIMP Foundation, will be required to perform any duties, or have any additional responsibities placed on them without his/her consent.

What I want is to create an organization that can handle many of the details that do not interest a casual (or even not-so-casual) volunteer. There are quite a few things that could be done to increase the popularity of The GIMP that could be done easier under the organization of TGF. Marketing, making contacts, hiring employees, solicting donations, etc. are all difficult and valuable activities that could benefit all the developers, including the volunteer ones. I want to put in place means to increase oppurtunites for all of our developers. Increasing our userbase, attracting developers, attracting corporations interested in The GIMP will undoubtably lead to more and better opportunites for existing developers.

BENEFITS OF INCORPORATION Presumably, I could handle all of these things myself, without creating a legal entity to do so. However, the existance of The GIMP Foundation has several legal benefits:
1) The GIMP Foundation can enter into contracts and acquire loans and, as long as the Directors act in Good Faith (and follow some fairly simple rules) cannot be held liable for any actions of TGF. This means that if TGF enters into a contract with a corporation (such as accepting a donation to finish a certain feature in The GIMP) and 50% of the way though the feature the corporation decides they want their money back, the individual directors and members hold no personal responsibility to pay back that corporation.
2) TGF can offer tax deductable donations. 3) We become qualified for Federal, state, and private grants.

The first provision above is probably the most important. It means that if you follow the rules, there is no risk (other than the time you put into the organization) to running it. It also means that TGF can enter into contracts with people like Mark Shuttleworth and the individual members, directors and officers are not at risk of losing any personal funds.

RESPONSIBILITES OF THOSE INVOVLED

Non-profits have to have certain organizational structers. There must be a board of directors. The board has the power to enter into major business dealings, decides what to do with assets, and has to the power to hire officers. The officers handle the day to day business of the corporation. However, being invovled with The GIMP Foundation means you will be held to certain responsibilities.

If you are a board member you must: Attend board meetings.
Vote on specific issues.
Avoid conflict of interest.
Avoid self-dealing.
Be honest.
Be careful with the funds of the Foundation. fufill any other specific duties outlined in the bylaws.

Board members have the power to: Enter into contracts in the name of TGF. make finantial decisions about the future of The GIMP. hire officers.

Officers are empowered to handle the day to day decisions of the board. They are not normally empowered to enter into major business dealings, and the board is responsible for their actions. They must also fufill any responsibilites outlined in the bylaws.

In addition, 51% of the board members have to be disinterested. (this means they or anyone related to them cannot be compensated by TGF for other than as a director). I.e. 51% of board members have to be volunteer. Also there are no residency or age requirements on any of these positions. (though the board members should be at least 18 so that they have the ability to enter into contracts).

A non-profit may or may not have members. Members (in the legal sense) have specific voting rights and privledges. If a membership exists, they elect and remove directors, amend bylaws and articles, approve mergers and consolidations, and approve the sale of corporate assets. Note that just because the corporation doesn't have voting members, it doesn't mean it can't have informal members (aka patrons) that support the organization but are not granted any specific voting rights. In the event you don't have members, then the board has the power to vote on the above decisions. Members can be granted additional privledges in the bylaws.

THINGS TO BE DECIDED

Given the above, which is all stuff required by law, I am having a lawyer draft up some inital bylaws, which we can then modify for our own purposes. Most of the technical details can be left till after we have some draft bylaws. However, we need to decide a few things rather more immediately, as my lawyer is asking me to answer these questions.

1. Will TGF have members? I am talking about members with voting privledges, like I described above. (my vote is yes, btw) 2. Should the membership be paid? (my vote is yes, for like $50 a year or some toher small amount. It helps for tax purposes). 3. Should the membership have additional rights?

LOOKING FOR HELP

It would be useful to know who is interested in accepting the responsibilites of being a board member (or officer). If we have members you will need to be voted in. If we don't have members the board will vote you in, all of this will be using the rules describe in the bylaws, which, again, are not written yet.

WHAT THE ORGANIZATION CAN DO

Here are a few of the things, that given the oppurtunity and funds I would like to do with TGF. I am copying this directly from a private mail I sent to Mark Shuttleworth.

What exactly The GIMP team (and thus The GIMP Foundation) would do with funding made available to them would depend exactly on how much we had. I said this before but now I want to be much more specific:

up to $20,000 Using this amount, we would pay for our developer's conference. We use these to plan our next version and they always result in a lot of extra ideas and work from our volunteers, especially after the conference, when everyone goes home.

$20,000 to $65,000 In addition to paying for our developer conference, we could use this amount to set up bounties. Several developers have expressed interest in bounty style work, even when they were not interested in full time GIMP work.

$65,000 to $85,000 This amount is just right for a developer for about a year. (with anything leftover going to pay for our developers conference). A developer is, by leaps and bounds, the most worth while investment we can make. Having a single full time developer will: -Drastically cut down on our development times (by 30% or more). -Allow that developer to leverage his current employment to find other contributors willing to pay his salary (or find someone to hire more developers). A full time developer can easily show to other organizations who are interested in The GIMP (there are many) how valuable a full time developer can be to them. -Become more aggressive in recruiting corporate partners. Often this takes time, attention, and contacts. Only with someone working full time on this, are these sorts of tasks possible. -Create the structures in The GIMP Foundation for: accepting more donations, working with businesses and individuals to fulfill their GIMP needs, and educating the world about The GIMP.

$85,000 or more More than $85,000, and we can begin to repeat this cycle. More conferences, more bounties, and more developers. Rather large amounts of money (by our project's standards, anyway), open up quite a few other possibilities. -Creating course curriculum designed to teach graphic designers and artists how to use The GIMP (I already have someone in mind for this, even). -Get The GIMP installers on CD and have that CD included with major graphics and movie magazines. -Get the GIMP in bookstores, next to the register (like AOL, only better!). -Get another book or two written for The GIMP (a graphic design book with examples from The GIMP, rather than a gimp specific book). -Hire GNOME user interface usability testers to test The GIMP. -Create a build farm for nightly builds of The GIMP. -Recruit graphic designers and teachers to evangelize The GIMP. -Create contests (with rewards) for developing GIMP artwork.

--I am sure I can think of more

In any case, if it wasn't clear before, I want people to know that by lending vocal support to TGF, you are not pledging any responsibility, nor are you at any finantial risk. I cannot do this without the support of the developers. If I do not speak for you, then there is no point for me to continue.

--
Daniel S. Rogers
dsrogers@gimp.org

On Mar 8, 2004, at 8:25 AM, Kelly Martin wrote:

Dave Neary wrote:

Daniel Rogers wrote:

Avoid self-dealing.

What's this?

Self-dealing is whenever the people who control the organization command the organization to do business with themselves in their personal capacity. Self-dealing "tears the veil" and makes the director or officer who engages in it personally liable for the corporation's debt by creating the presumption that the corporation is an "alter ego" of the individual. In the case of a non-profit, it also violates the rule against private inurement.

this is true, but it deals more directly with, as a board member, arranging a deal between The GIMP foundation and a board member. Self-dealing is when, for example, you own some property that you wish to sell to TGF and you are on TGF board. You have to do some full disclousure, follow very specific rules, and making too much money is frowned upon. Really it is not so much about avoidance (but that helps) as much as it is about following the rules. California and the US are very picky about making sure that non-profits are not used as a vehical to profit the board members.

It means, inter alia, that the directors of the non-profit cannot also receive money from it except possibly a small stipend and reimbursement of their expenses in attending board meetings and other organization functions. Being a member of the board of a non-profit organization is charity work: you generally cannot expect to get paid.

this is not true, actually. 51% of the members have to be "disinterested." It means that 51% of the board members cannot themselves or anyone related to them be paid (except the stipend and compensation you mentioned). Related, here, has a very specific definition. It means that if there are four board members, and I am getting paid to hack on gegl by TGF, then none of the other board members can get paid. It also means that if I hire my wife to do some work, then I am "interested" and no one else (or their relatives) on a four person board can get paid.

If you're looking to get a job with the GIMP Foundation, you can't also be a member of its board of directors (except as an ex-officio member, which the Executive Director typically would be). This doesn't mean that the Foundation can't hire staff, just that those staff can't be the ones making the ultimate decisions on how to spend the organization's money.

Again, this is _not_ true. More than half must be volunteer though.

Staff can recommend, but final approval of at least the general budget has to be by the volunteer board.

This bit is true, except that the board must simply be more than half volunteer.

To do otherwise risks a finding that the organization inures to the benefit of a private party, which destroys non-profit status.

There are of course, other ways to destroy non-profit status, such as getting too much regular funding from a single source.

I'm very interested in the idea of a Foundation and would love to be a part of one, but I have no expectation of it turning into a personal revenue stream.

Again, if you are a board member, you could get a job with TGF. But seeing how TGF, at this point, is not exactly handing out jobs, I would agree with this sentiment.

--
Dan

Nathan Carl Summers wrote:

Is this required to be in person, or is conference call/irc/email/etc sufficient? Furthermore, is it possible for board members to be reimbursed for expenses? I can see this being a major obstacle for non-us residents otherwise.

Kelly already answered the first part, but yes. If TGF has money, it's board members can be reimbursed for the expenses of attending a meeting (including phone bills, even), without destroying it's non-profit status.

-- Dan