EXAMPLE 2:
By Laws for a nonprofit organization
(with formal voting membership.)
BYLAWS OF THE
[Insert name of association]
ARTICLE I
OFFICE AND REGISTERED AGENT
Section 1. Principal Office. The
principal office of the __________________ shall be in the
State of _____________.
Section 2. Registered Office and
Agent. The Corporation shall have and continuously maintain
a registered office and a
registered agent in the State of ___________, as required by the State of
______________ Nonprofit
Corporation Act. The registered agent shall be either an individual
resident of the State or a
corporation authorized to transact business in the State.
ARTICLE II
PURPOSES
The purposes for which the
Corporation is formed are as set forth in the Articles of
Incorporation. [OTE: The purposes
from the Articles of Incorporation may be reprinted
here. However, it must be
remembered that amending the purposes in the bylaws is not
effective unless the purposes
clause in the articles of incorporation is also amended. A
“mission statement” interpreting
and clarifying the purposes may be inserted here as well.]
ARTICLE III
MEMBERSHIP
[OTE: There are a wide variety of membership provisions that could be
added to
Bylaws. In general, the bylaws
should specify the categories of membership, which
categories have voting power,
what types of actions members are allowed to vote on, and
how member meetings are called
and votes are cast. The example below contains three
very simple classes of members.
The fine details of membership qualification, removal,
payment of dues, etc. are often
set forth in separate documents, rather than cluttering the
bylaws.]
Section 9. Notice. Notice of the
time, day, and place of any meeting of the Board of Directors
shall be given at least ____ days
previous to the meeting and in the manner set forth in Section 2
of Article VII. The purpose for
which a special meeting is called shall be stated in the notice.
Any director may waive notice of
any meeting by a written statement executed either before or
after the meeting. Attendance and
participation at a meeting without objection to notice shall
also constitute a waiver of
notice.
Section 10. Quorum. A majority of
the directors then in office shall constitute a quorum for the
transaction of business at any
meeting of the Board of Directors.
Section 11. Manner of Acting.
Except as otherwise expressly required by law, the Articles of
Incorporation of the Corporation,
or these Bylaws, the affirmative vote of a majority of the
directors present at any meeting
at which a quorum is present shall be the act of the Board of
Directors. Each director shall
have one vote. Voting by proxy shall not be permitted.
Section 12. Unanimous Written
Consent In Lieu of a Meeting. The Board may take action
without a meeting if written
consent to the action is signed by all of the directors.
Section 13. Telephone Meeting.
Any one or more directors may participate in a meeting of the
Board of Directors by means of a
conference telephone or similar telecommunications device,
which allows all persons
participating in the meeting to hear each other. Participation by
telephone shall be equivalent to
presence in person at the meeting for purposes of determining if
a quorum is present.
Section 14. Conflicts of
Interest. [OTE: This clause is optional, but may be useful in
helping the board handle
situations where a director cannot be impartial due to a financial
or other conflict of interest.
Alternatively, the Board could simply adopt by resolution a
Conflicts-of-Interest policy that
is not part of the Bylaws. An example of a policy that has
been approved by the IRS follows
this Bylaws example.]
(a) In the event that any
director has a conflict of interest that might properly limit such
director’s fair and impartial
participation in Board deliberations or decisions, such
director shall inform the Board
as to the circumstances of such conflict. If those
circumstances require the
nonparticipation of the affected director, the Board may
nonetheless request from the
director any appropriate nonconfidential information which
might inform its decisions.
"Conflict of interest," as referred to herein, shall include but
shall not be limited to, any
transaction by or with the Corporation in which a director has
a direct or indirect personal
interest, or any transaction in which a director is unable to
exercise impartial judgment or
otherwise act in the best interests of the Corporation.
(b) No director shall cast a
vote, nor take part in the final deliberation in any matter in
which he or she, members of his
or her immediate family or any organization to which
such director has allegiance, has
a personal interest that may be seen as competing with
Section 6. Rules. Each committee
and task force may adopt rules for its meetings not
inconsistent with these Bylaws or
with any rules adopted by the Board of Directors.
ARTICLE VII
MISCELLANEOUS
PROVISIONS
[NOTE: It is not necessary to
state the fiscal year in the bylaws, although many charities do so.]
Section 1. Fiscal Year. The
fiscal year of the Corporation shall be [the calendar year] [insert any
other period].
Section 2. Notice. Whenever under
the provisions of these Bylaws notice is required to be given
to a director, officer, or
committee member, such notice shall be given in writing by first-class
mail or overnight delivery
service with postage prepaid to such person at his or her address as it
appears on the records of the
Corporation. Such notice shall be deemed to have been given when
deposited in the mail or the
delivery service. Notice may also be given by facsimile, electronic
mail, or hand delivery, and will
be deemed given when received. [OTE: Be sure to check
state corporate law to see if
facsimile and electronic mail are authorized means of giving
notice.]
ARTICLE VIII
INDEMNIFICATION
Unless otherwise prohibited by law, the Corporation [may] [shall]
indemnify any director or
officer or any former director or
officer, and may by resolution of the Board of Directors
indemnify any employee, against
any and all expenses and liabilities incurred by him or her in
connection with any claim,
action, suit, or proceeding to which he or she is made a party by
reason of being a director,
officer, or employee. However, there shall be no indemnification in
relation to matters as to which
he or she shall be adjudged to be guilty of a criminal offense or
liable to the Corporation for
damages arising out of his or her own gross negligence in the
performance of a duty to the
Corporation.
Amounts paid in indemnification
of expenses and liabilities may include, but shall not be limited
to, counsel fees and other fees;
costs and disbursements; and judgments, fines, and penalties
against, and amounts paid in
settlement by, such director, officer, or employee. The Corporation
may advance expenses or, where
appropriate, may itself undertake the defense of any director,
officer, or employee. However,
such director, officer, or employee shall repay such expenses if it
should be ultimately determined
that he or she is not entitled to indemnification under this
Article.
The Board of Directors [shall]
[may] also authorize the purchase of insurance on behalf of any
director, officer, employee, or
other agent against any liability incurred by him which arises out
of such person's status as a
director, officer, employee, or agent, whether or not the Corporation
would have the power to indemnify
the person against that liability under law.
ARTICLE IX
AMENDMENTS TO BYLAWS
These Bylaws may be amended or
new Bylaws adopted upon the affirmative vote of [a majority]
[two-thirds] [three-fourths] of
the voting members at any regular or special meeting of the
members. The notice of the
meeting shall set forth a summary of the proposed amendments.
[OTE: Careful thought should be
given to major decisions, such as amending the Bylaws,
removing directors, or merging
with another entity. In the absence of specific language to
the contrary, the requirement of
a “two-thirds vote,” for example, simply means that there
must be the approval of
two-thirds of a quorum in order for the measure to pass. Thus,
depending upon the number of
members who vote at a meeting in person or by proxy, it is
possible for Bylaws to be amended
by a relatively small percentage of the total voting
membership. If it is desired that
major decisions receive the approval of a very large
percentage of the voting members,
consider requiring a two-thirds or three-fourths vote of
“all of the votes entitled to be
cast by the members.”]
