Bylaws

Bylaws

John Hersey Athletic Booster Club

 

ARTICLE I

Name and Office

 

1.1       Name. The name of the organization shall be JOHN HERSEY ATHLETIC BOOSTER CLUB (hereinafter referred to as the “Organization”).

 

1.2       Office. The Organization’s official mailing address shall be:

 

c/o John Hersey High School

1900 East Thomas Street

Arlington Heights, Illinois 60004-4320

 

The Organization shall continuously maintain in the State of Illinois a registered office and a registered agent whose business office is identical with such registered office and may have other offices within or without the state.

 

ARTICLE II

Company Purposes and Limitations

 

2.1       General Purposes. The Organization shall have such religious, charitable, educational or scientific purposes as are permitted under Section 501(c)(3) of the Internal Revenue Code, subject to these Bylaws. Specifically, the Organization shall have the following purposes:

 

  • The Organization shall work at all times to aid in supporting, wherever possible, the athletic activities of John Hersey High School (the “School”), so that the students, the athletes, the School, and the community will benefit.

 

  • The Organization shall work at all times to promote public consciousness of the athletic activities of the School and to promote good sportsmanship on the part of participants and spectators of all athletic activities of the School.

 

  • The Organization and its members shall work in cooperation with the School District 214 Designees (the “Designees”) and at no time will it be our policy to interfere with the policies, methods, rules and regulations, or eligibility requirements of the School.

 

2.2       Powers and Limitations.

 

  • The Organization, being organized exclusively for religious, charitable, educational or scientific purposes, may make distributions to Companies that qualify as exempt Companies under Section 501(c)(3) of the Internal Revenue Code of 1986 (or the correspondent provisions of any future United States Internal Revenue Law).

 

  • No part of the net earnings of the Organization shall inure to the benefit of, or be distributable to its Directors, officers, or other private persons, except that the Organization shall be authorized and empowered to pay reasonable compensation for services rendered and to make payments and distributions in furtherance of the purposes set forth in Section 2.2.

 

  • No substantial part of the activities of the Organization shall be the carrying on of propaganda, or otherwise attempting to influence legislation, and the Organization shall not participate in, or intervene in (including the publishing or distribution of statements) any political campaign on behalf of any candidate for public office.

 

  • Notwithstanding any other provision of these articles, the Organization shall not carry on any other activities not permitted to be carried on by a Company exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code of 1986 (or the corresponding provision of any future United States Internal Revenue Law), or by a Company, contributions to which are deductible under Section 170(c)(2) of the Internal Revenue Code of 1986 (or the corresponding provision of any future United State Internal Revenue Law).

 

  • Upon dissolution of the Organization, the board of directors shall, after paying or making provision for the payment of all the liabilities of and loans to the Organization, distribute all assets, both real and personal, to another such entity organized and operated exclusively for charitable, educational, religious, or scientific purposes as shall at the time qualify as an exempt entity under the Section 501(c)(3) of the Internal Revenue Code of 1986 (or corresponding provision of any future United States Internal Revenue Law), as the board of directors shall determine. Any such assets not so disposed of shall be disposed of by the appropriate court of law of the county in which the principal office of the Organization is then located, exclusively for such purposes or to such companies, as said court shall determine, which are organized and operated exclusively for exempt purposes.

 

ARTICLE III

Membership and Dues

 

3.1       Membership. Any parent or guardian of a student currently enrolled at the School may become an active member of the Organization.

 

3.2       Associate Membership. Any adult who is not the parent or guardian of a student currently enrolled at the School may become an associate member. Associate members shall enjoy the same rights and privileges as active members, except that associate members shall not be permitted to hold office or vote at general and special elections.

 

3.3       Membership Applications. The Organization shall make applications for membership available to individuals who desire to be members or associate members. All applications for membership or associate membership must be in writing and must be submitted with prepayment of annual membership dues. Memberships are valid for the period of August 1 through the following July 31 unless indicated otherwise by the Organization at the time of approval of the application. The Organization’s Board of Directors (the “Board”) may review and approve or deny pending membership applications at its meetings in its sole discretion.

 

3.4       Expulsion of Members. The Organization’s membership may, with approval of no less than 75% of the members present at a meeting constituting a quorum, expel from the Organization or censure any member for any act or conduct deemed not in the best interest of the Organization, provided that: (1) such member shall have the right to appear in his/her own defense; and (2) written notice of the vote on expulsion shall be given to such member at least one (1) week prior to such meeting. Any member expelled under this Section may not apply for reinstatement to the Organization until one (1) year has elapsed from the time of expulsion. Reinstatement at that time must have the approval of a majority of the Board.

 

3.5       Membership Dues. Membership dues shall be assessed and paid on a per-family basis. The annual dues per family shall be established once per year.

 

3.6       Meetings. The Organization’s membership may attend Board meetings, at such times and places as are designated by the Board. Notice of such meetings shall be made public not less than forty-eight (48) hours prior to the scheduled dates of such meetings. Special meetings of the membership may also be called upon written call of one-fourth (1/4) of the active members, provided that not less than forty-eight (48) hours public notice is given and the general purpose is stated.

 

ARTICLE IV

Board of Directors

 

4.1       General Powers. The affairs of the Organization shall be managed by or under the direction of its Board.

 

4.2       Number, Tenure and Qualifications. The number of directors shall be no less than four (4) and no more than sixteen (16), with the President, Vice President, Secretary, and Treasurer each serving as directors. The number of directors may be increased to any number from time to time by amendment of this section and may be decreased to not fewer than four, unless the articles of incorporation provide that a change in the number of directors shall be made only by amendment of the articles of incorporation. No decrease shall have the effect of shortening the term of an incumbent director. All directors must be parents or guardians of students currently enrolled at the School. Except as otherwise set forth herein, Board members shall hold office as long as they are the parent or guardian of a student currently enrolled at the School or until they resign. Directors shall be eligible for nomination to executive offices and/or reelection to the Board.

 

4.3       Regular Meetings. Regular meetings of the Board shall be held approximately ten (10) times annually. Written notice stating the place, date, and hour of any meeting of the Board shall be determined by the President and/or the Board and shall be made available to the directors. In case of a special meeting or when required by statute or by these bylaws, the purpose for which the meeting is called shall be stated in the notice. If mailed, the notice of a meeting shall be deemed delivered when deposited in the United States mail addressed to the member at his or her address as it appears on the records of the corporation, with postage thereon prepaid. When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. The Board may provide, by resolution, the time and place for the holding of additional regular meetings of the board without other notice than such resolution. All Board members are expected to give prior notification to the President or Secretary if they are unable to attend a regularly-scheduled meeting.

 

4.4       Special Meetings. Special meetings of the Board may be called by or at the request of the President or at the request of a majority of the Board members. The person or persons authorized to call special meetings of the board may fix any place as the place for holding any special meeting of the board called by them.

 

4.5       Notice. Notice of regular and special meetings may be provided via electronic mail, posting to the Organization’s website, or any other reasonable method not prohibited by law. Notice of any special meeting of the Board shall be given at least 2 days previous thereto by written notice to each director at his or her address as shown by the records of the Organization except that no special meeting of the Board may remove a director unless written notice of the proposed removal is delivered to all directors at least 20 days prior to such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail in a sealed envelope so addressed, with postage thereon prepaid. Notice of any special meeting of the Board may be waived in writing signed by the person or persons entitled to the notice either before or after the time of the meeting. The attendance of a director at any meeting shall constitute a waiver of notice of such meeting, except when a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board need be specified in the notice or waiver of notice of such meeting unless specifically required by law or by these bylaws.

 

4.6       Quorum. More than one-half (1/2) of the Board members shall constitute a quorum for the transaction of business at any meeting of the Board, provided that the President or Vice President is present, and further provided that if less than such number of directors are present at said meeting, a majority of the directors present may adjourn the meeting to another time without further notice.

 

4.7       Manner of Acting. The act 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 act of a greater number is required by statute, these bylaws, or the articles of incorporation. No director may act by proxy on any matter.

 

4.8       Vacancies. Any vacancy occurring in the Board or any directorship to be filled by reason of an increase in the number of directors shall be filled by the Board unless the articles of incorporation, a statute, or these bylaws provide that a vacancy or a directorship so created shall be filled in some other manner, in which case such provision shall control. A director elected or appointed, as the case may be, to fill a vacancy shall be elected for the unexpired term of his or her predecessor in office.

 

4.9       Resignation and Removal of Directors. A director may resign at any time upon written notice to the Board. A director may be removed upon the majority vote of the Board.

 

4.10     Informal Action by Directors. The authority of the Board may be exercised without a meeting if a consent in writing, setting forth the action taken, is obtained from all of the directors entitled to vote.

 

4.11     Compensation. The Board members shall not be entitled to receive compensation for their services to the Organization.

 

4.12     Presumption of Assent. A director of the Organization who is present at a meeting of the Board at which action on any Organization matter is taken shall be conclusively presumed to have assented to the action taken unless his or her dissent shall be entered in the minutes of the meeting or unless he or she shall file his or her written dissent to such action with the person acting as the secretary of the meeting before the adjournment thereof or shall forward such dissent by registered or certified mail to the secretary of the Organization immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action.

 

4.13     School Activities. The Board shall assist the Designees in coordinating the Organization’s activities with those of the School.

 

 

ARTICLE V

Officers

 

5.1       Officers. The officers of the Organization shall be the President, Vice President, Treasurer, and Secretary.

 

5.2       Election and Term of Office. The officers of the Organization shall be elected annually by the Board at its regular May meeting. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be. Vacancies may be filled at any meeting of the Board. In the case of a vacancy in the office of the President, Board shall meet within ten (10) days after such vacancy is created and shall appoint a replacement President to fill the unexpired term. Notice of the Board’s appointment shall be given to the membership no more than two (2) weeks following such meeting. An officer elected or appointed, as the case may be, to fill a vacancy shall be elected for the unexpired term of his or her predecessor in office. Each officer shall serve a one-year term or until he or she shall resign or shall have been removed in the manner hereinafter provided. Election of an officer shall not of itself create contract rights.

 

5.3       Removal. Any officer may be removed in the same manner that Board member may be removed.

 

5.4       President. The President shall be the principal executive officer of the Organization. Subject to the direction and control of the Board, he or she shall be in charge of the business and affairs of the Organization; he or she shall see that the resolutions and directives of the board of directors are carried into effect except in those instances in which that responsibility is assigned to some other person by the board of directors; and, in general, he or she shall discharge all duties incident to the office of President and such other duties as may be prescribed by the Board. He or she shall preside at all meetings of the Board. Except in those instances in which the authority to execute is expressly delegated to another officer or agent of the Organization or a different mode of execution is expressly prescribed by the board of directors or these bylaws, he or she may execute for the Organization any contracts, deeds, mortgages, bonds, or other instruments that the board of directors has authorized to be executed, and he or she may accomplish such execution either individually or with the secretary, any assistant secretary, or any other officer thereunto authorized by the board of directors, according to the requirements of the form of the instrument.

 

He or she may vote all securities that the Organization is entitled to vote except as and to the extent such authority shall be vested in a different officer or agent of the Organization by the board of directors.

 

5.5       Vice President. The Vice President shall assist the President in the discharge of his or her duties as the President may direct and shall perform such other duties as from time to time may be assigned to him or her by the President or the Board. In the absence of the President or in the event of his or her inability or refusal to act, the Vice President shall perform the duties of the President and, when so acting, shall have all the powers of and be subject to all the restrictions on the President. Except in those instances in which the authority to execute is expressly delegated to another officer or agent of the Organization or a different mode of execution is expressly prescribed by the Board or these bylaws, the Vice President may execute for the Organization any contracts, deeds, mortgages, bonds, or other instruments that the board of directors has authorized to be executed, and he or she may accomplish such execution either individually or with the secretary, any assistant secretary, or any other officer thereunto authorized by the board of directors, according to the requirements of the form of the instrument.

 

5.6       Treasurer. The Treasurer shall be the principal accounting and financial officer of the Organization. He or she shall: (a) have charge of and be responsible for the maintenance of adequate books of account for the Organization; (b) have charge and custody of all funds and securities of the Organization, and be responsible therefor, and for the receipt and disbursement thereof; (c) ensure the timely and accurate filing of all federal and state tax returns, if any, including, but not limited to, the annual filing of the Organization’s form 990, Return of Organization Exempt from Income Tax; and (d) perform all the duties incident to the office of Treasurer and such other duties as from time to time may be assigned to him or her by the president or by the Board. The Treasurer shall, on a monthly basis, provide a report detailing all funds deposited by the Organization, all expenditures of the Organization, and the balance in all Organization bank accounts. If required by the Board, the Treasurer shall give a bond for the faithful discharge of his or her duties in such sum and with such surety or sureties as the board of directors shall determine.

 

5.7       Secretary. The Secretary shall: (a) record the minutes of meetings in one or more books provided for that purpose; (b) see that all notices are duly given in accordance with the provisions of these bylaws or as required by law; (c) be a custodian of the corporate records; (d) keep a register of the post office address of each member that shall be furnished to the Secretary by such member; and (e) perform all duties incident to the office of Secretary and such other duties as from time to time may be assigned to him or her by the president or by the Board.

 

5.8       Salaries. Officers shall not be entitled to receive compensation for their services to the Organization.

 

ARTICLE VI
Elections

 

6.1       Nominating Committee. No less than forty-five (45) days prior to the annual election, which will be held at the May Board meeting, the President shall appoint, with the approval of the Board, a Nominating Committee of not less than three (3) members.

 

6.2       Nomination of Directors. Members who desire to be elected to the Board shall complete applications to be made available by the Organization and submit such applications to the Board. The Board shall provide such completed applications to the Nominating Committee for review. After reviewing such applications, the Nominating Committee shall present to the Board, with the consent of the nominees, the names of eligible candidates for election to the Board.

 

6.3       Nomination of Officers. Directors who desire to be elected to officer positions shall inform the Nominating Committee of such desire. Thereafter, the Nominating Committee shall present to the Board, with the consent of the nominees, the names of candidates for election to each office. At least one member shall be nominated for each office.

 

6.4       Annual Elections. Annual elections will be held during the May Board meeting.   Officers and Directors shall take office after the next regular meeting following the annual election.

 

ARTICLE VII

Committees, Commissions, and Advisory Boards

 

7.1       Committees. The Board, by resolution adopted by a majority of the directors in office, may designate one or more committees The committees, to the extent provided in said resolution and not restricted by law, shall have and exercise the authority of the Board in the management of the Organization; but the designation of such committees and the delegation thereto of authority shall not operate to relieve the Board, or any individual director, of any responsibility imposed on it, him, or her by law.

 

7.2       Commissions or Advisory Bodies. Commissions or advisory bodies not having and exercising the authority of the Board in the Organization may be designated or created by the Board and shall consist of such persons as the Board designates. A commission or advisory body may or may not have directors as members, as the Board determines. The commission or advisory body may not act on behalf of the Organization or bind it to any actions but may make recommendations to the Board or to the officers of the Organization.

 

7.3       Term of Office. Each member of a committee, advisory board, or commission shall continue as such for one (1) year and until his or her successor is appointed, unless the committee, advisory board, or commission shall be sooner terminated, or unless such member be removed from such committee, advisory board, or commission by the Board, or unless such member shall cease to qualify as a member thereof.

 

7.4       Committee Offices and Members. The President, subject to Board approval, shall appoint a chairman, vice chairman, and the members of each Committee, advisory board, or commission. The President and Vice President shall be ex-officio members of all committees.

 

7.5       Vacancies. Vacancies in the membership of any committee, advisory board, or commission may be filled by appointments made in the same manner as provided in the case of the original appointments.

 

7.6       Quorum. Unless otherwise provided in the resolution of the Board designating a committee, advisory board, or commission, a majority of the whole committee, advisory board, or commission shall constitute a quorum, and the act of a majority of the members present at a meeting at which a quorum is present shall be the act of the committee, advisory board, or commission.

 

7.7       Rules. Each committee, advisory board, or commission may adopt rules for its own government not inconsistent with these bylaws or with rules adopted by the Board.

 

7.8       Informal Action. The authority of a committee may be exercised without a meeting if a consent in writing, setting forth the action taken, is obtained from all the members entitled to vote.

 

7.9       Audit Committee. The President shall appoint a committee to conduct an “audit-like” review of the Treasurer’s records for the previous year. The Committee shall consist of one member of the School administration (preferably an athletic director) and any two (2) Board members (excluding officers). This review shall be conducted within sixty (60) days of the end of the Organization’s fiscal year, and a formal presentation shall be made to the Board at the August Board meeting

 

 

 

ARTICLE VIII
Contracts, Checks, Deposits, and Funds

 

8.1       Contracts. The Board may authorize any officer or officers or agent or agents of the Organization, in addition to the officers so authorized by these bylaws, to enter into any contract or execute and deliver any instrument in the name of and on behalf of the Organization, and such authority may be general or confined to specific instances.

 

8.2       Checks, Drafts, Etc. All checks, drafts, or other orders for the payment of money, notes, or other evidences of indebtedness issued in the name of the Organization shall be signed by any two (2) officers, except as is otherwise determined from time-to-time by resolution of the Board.

 

8.3       Deposits. All funds of the Organization shall be deposited from time to time to the credit of the Organization in such banks, trust companies, or other depositories as the Board may select.

 

8.4       Gifts. The Board may accept on behalf of the Organization any contribution, gift, bequest, or devise for the general purposes or for any special purpose of the Organization.

 

8.5       Requests for Financial Support.  Requests for financial support of the Organization shall be presented to the Board for approval.  All requests must be approved by the Board prior to any commitment of the Organization’s funds.  The Board may approve by majority vote committing the Organization’s funds to those matters or towards the purchase of those items consistent with promoting the purposes of the Organization.

 

8.6       Cash Banks. The Treasurer is authorized to disburse reasonable funds for cash banks. Funds provided for cash banks will be accounted for by vouchers. Cash banks will be returned as soon as possible to the Treasurer and fully accounted for by event.

 

8.7       Reserves. A minimum of $5,000.00 of uncommitted funds are to be carried over each year.

 

ARTICLE IX
Books and Records

 

9.1       Books and Records. The Organization shall keep correct and complete books and records of account. It shall also keep minutes of the proceedings of its Board and committees having any of the authority of the Board and shall keep at the registered or principal office a record giving the names and addresses of the directors entitled to vote. All books and records of the Organization may be inspected by any member, or his or her agent or attorney, for any proper purpose at any reasonable time.

 

ARTICLE X
Fiscal Year

 

10.1     Fiscal Year. The fiscal year of the Organization shall be fixed by resolution of the Board.

 

ARTICLE XI
Rules of Order

 

Roberts Rules of Order shall govern the proceedings of all meetings of the Organization and its constituent parts, except as is otherwise provided in these bylaws.

 

ARTICLE XII
Waiver of Notice

 

12.1     Waiver of Notice. Whenever any notice is required to be given under the provisions of the Illinois General Not For Profit Corporation Act or under the provisions of the articles of incorporation or the bylaws of the Organization, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. Attendance at any meeting shall constitute waiver of notice thereof unless the person at the meeting objects to the holding of the meeting because proper notice was not given.

 

ARTICLE XIII
Indemnification

 

13.1     Indemnification in Actions Other Than by or in the Right of the Organization. The Organization may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (other than an action by or in the right of the Organization) by reason of the fact that he or she is or was a director, officer, employee, or agent of the Organization, or is or was serving at the request of the Organization as a director, officer, employee, or agent of another Organization, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys’ fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit, or proceeding, if such person acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the Organization and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, or conviction or upon a plea of nolo contendere or its equivalent shall not, of itself, create a presumption that the person did not act in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Organization or, with respect to any criminal action or proceeding, that the person had reasonable cause to believe that his or her conduct was unlawful.

 

13.2     Indemnification in Actions by or in the Right of the Organization. The Organization may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of the Organization to procure a judgment in its favor by reason of the fact that such person is or was a director, officer, employee, or agent of the Organization, or is or was serving at the request of the Organization as a director, officer, employee, or agent of another Organization, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit, if such person acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the Organization, provided that no indemnification shall be made in respect of any claim, issue, or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his or her duty to the Organization, unless, and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability, but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses as the court shall deem proper.

 

13.3     Right to Payment of Expenses. To the extent that a director, officer, employee, or agent of the Organization has been successful, on the merits or otherwise, in the defense of any action, suit, or proceeding referred to in Sections 10.1 and 10.2, or in defense of any claim, issue, or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.

 

13.4     Determination of Conduct. Any indemnification under Sections 12.1 and 12.2 (unless ordered by a court) shall be made by the Organization only as authorized in the specific case, upon a determination that indemnification of the director, officer, employee, or agent is proper in the circumstances because he or she has met the applicable standard of conduct set forth in Sections 1 or 2 of this Article. Such determination shall be made: (a) by the Board by a majority vote of a quorum consisting of directors who were not parties to such action, suit, or proceeding; (b) if such a quorum is not obtainable, or even if obtainable, if a quorum of disinterested directors so directs, by independent legal counsel in a written opinion; or (c) by the members entitled to vote, if any.

 

13.5     Payment of Expenses in Advance. Expenses incurred in defending a civil or criminal action, suit, or proceeding may be paid by the Organization in advance of the final disposition of such action, suit, or proceeding, as authorized by the Board in the specific case, upon receipt of an undertaking by or on behalf of the director, officer, employee, or agent to repay such amount, unless it shall ultimately be determined that he or she is entitled to be indemnified by the Organization as authorized in this Article.

 

13.6     Indemnification Not Exclusive. The indemnification provided by this Article shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under any bylaw, agreement, vote of members or disinterested directors, or otherwise, both as to action in his or her official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee, or agent, and shall inure to the benefit of the heirs, executors, and administrators of such a person.

 

13.7     Insurance. The Organization may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Organization, or who is or was serving at the request of the Organization as a director, officer, employee, or agent of another Organization, partnership, joint venture, trust, or other enterprise, against any liability asserted against such person and incurred by such person in any such capacity, or arising out of his or her status as such, whether or not the Organization would have the power to indemnify such person against such liability under the provisions of this Article.

 

13.8     Notice to Directors. If the Organization has paid indemnity or has advanced expenses under this Article to a director, officer, employee, or agent, the Organization shall report the indemnification or advance in writing to all directors.

 

13.9     References to Organization. For purposes of this Article, references to “the Organization” shall include, in addition to the surviving Organization, any merging Organization (including any Organization having merged with a merging Organization) absorbed in a merger that, if its separate existence had continued, would have had the power and authority to indemnify its directors, officers, employees, or agents, so that any person who was a director, officer, employee, or agent of such merging Organization, or was serving at the request of such merging Organization as a director, officer, employee, or agent of another Organization, partnership, joint venture, trust, or other enterprise, shall stand in the same position under the provisions of this Article with respect to the surviving Organization as such person would have stood with respect to such merging Organization if its separate existence had continued.

 

13.10   Other References. For purposes of this Article, references to “other enterprises” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to “serving at the request of the Organization” shall include any service as a director, officer, employee, or agent of the Organization that imposes duties on or involves services by such director, officer, employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries. A person who acted in good faith and in a manner he or she reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Organization” as referred to in this Article.

 

ARTICLE XIV

Conflict of Interest

 

14.1     Purpose. The purpose of the conflict of interest policy is to protect this Organization’s 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 corporations.

 

14.2

 

(a)        Interested Person. Any director or principal officer of the Organization who has a direct or indirect financial interest, as defined below, is an interested person.

(b)        Financial Interest. A person has a financial interest if the person has, directly or indirectly, through business, investment, or family:

 

(i)         An ownership or investment interest in any entity with which the Organization has a transaction or arrangement;

 

(ii)        A compensation arrangement with the Organization or with any entity or individual with which the Organization has a transaction or arrangement; or

 

(iii)       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 shall include 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 this Article XIII, Section 13.2(b), a person who has a financial interest may have a conflict of interest only if the Board decides that a conflict of interest exists.

 

14.3     Procedures.

 

(a)        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 Board at the time it is considering the proposed transaction or arrangement.

 

(b)        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 Board meeting while the determination of a conflict of interest is discussed and voted upon. The remaining directors shall decide if a conflict of interest exists.

 

(c)        Procedures for Addressing the Conflict of Interest.

 

(i)         An interested person may make a presentation at the Board 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.

 

(ii)        The chairperson of the Board shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.

 

(iii)       After exercising due diligence, the Board 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.

 

(iv)       If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the Board shall determine by a majority vote of the 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.

 

(d)       Violations of the Conflicts of Interest Policy.

 

(i)         If the Board has reasonable cause to believe an interested person has failed to disclose actual or possible conflicts of interest, it shall inform the person of the basis for such belief and afford the person an opportunity to explain the alleged failure to disclose.

 

(ii)        If, after hearing the person’s response and after making further investigation as warranted by the circumstances, the Board determines the person has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.

14.4     Records of Proceedings. The minutes of the Board 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 financial interest, any action taken to determine whether a conflict of interest was present, and the board’s decision as to whether a conflict of interest in fact existed; and

 

(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.

14.5     Compensation. A voting member of the Board who receives compensation, directly or indirectly, from the Organization for services is precluded from voting on matters pertaining to that member’s compensation.

 

14.6     Annual Statements. Each director and principal officer shall annually sign a statement which affirms such person:

 

  • Has received a copy of the conflict of interest policy;

 

  • Has read and understands the policy;

 

  • Has agreed to comply with the policy; and

 

  • Understands that the Organization is charitable and to maintain its federal tax exemption, it must engage primarily in activities which accomplish one or more of its tax-exempt purposes.

 

14.7     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.

 

14.8     Use of Outside Experts. When conducting the periodic reviews as provided for in Article VII, the Organization may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are conducted.

 

ARTICLE XV
Bylaws; Amendments

 

15.1     Amendments. These Bylaws may be amended by a two-thirds (2/3) vote of the members present at any meeting at which a quorum is present provided that public notice of the proposed amendment or amendments has been made no less than five (5) days prior to the date of such meeting. The bylaws may contain any provisions for the regulation and management of the affairs of the Organization not inconsistent with law or the articles of incorporation.

 

15.2     Suspension of Bylaws. These bylaws may be suspended by the affirmative vote of the greater of: (1) ten (10) members of the Board; and (2) three-fourths (3/4) of the Board members present at any regular meeting at which a quorum is present.