Article VII - Restrictions Regarding the Operations of the Corporation; Administration of Funds

Written by Anthony Drago. Posted in Bylaws

Section 7.1 No Private Benefit.

In keeping with the statement of purpose of the Corporation as set forth in its Certificate of Incorporation, no part of the earnings or assets of the Corporation shall inure to the benefit of any private individual, and no substantial part of the activities of the Corporation shall be used for any purpose not permitted by these bylaws, the Certificate of Incorporation, the Act, or the Code.

Section 7.2 No Violation of Purposes.

In no event and under no circumstances shall the Board of Directors make any distribution or expenditure, engage in any activity, hold any assets, or enter into any transaction whatsoever the effect of which under applicable federal laws then in force will cause the Corporation to lose its status as an organization exempt from taxation under Section 501(c)(6) of the Code.

Section 7.3 Tax Records.

The Corporation shall maintain at its principal office a copy of its application for exemption and all tax returns filed with the Internal Revenue Service. To the extent required by law, such documents shall be made available during regular business hours for inspection by any person requesting to see them.

Section 7.4 Annual Report.

The Treasurer shall submit annually to the Board of Directors an annual report as soon as possible after December 31 of each year.

Section 7.5 Books and Records.

This Corporation will keep correct and complete books and records of account; minutes of the proceedings of its Board of Directors and committees; and the original or a copy of its Bylaws including amendments to date, certified by the Secretary of the Corporation at the principal office of the Corporation.

Section 7.6 Contracts.

The Board of Directors may authorize officer(s) or agent(s) of the Corporation in addition to the officers so authorized by these bylaws, to enter into any contract or execute and deliver any instrument in the name and on behalf of the Corporation. Such authority must be in writing and may be general or confined to specific instances.

Section 7.7 Checks, Drafts, Notes, Etc.

All checks, drafts or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the Corporation in excess of $500 shall be approved by the President or Vice-President of the Corporation, in addition to the Treasurer.

Section 7.8 Deposits.

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

Section 7.9 Gifts.

The Board of Directors may accept on behalf of the Corporation any contribution, gift, or devise for the general purposes or for any special purposes of the Corporation.

Section 7.10 Conflicts of Interest.

An actual or potential conflict of interest exists when any of the following exists:

(a) an officer or Director has an ownership or investment interest in or compensation relationship with a company or other business with which the Corporation does or proposes to do business; or

(b) an officer or Director receives remuneration for performing services for the Corporation and the Corporation is determining his or her remuneration;

A conflict of interest also exists when a similar circumstance exists with respect to a family Member of an officer or Director or company 35% or more owned by an officer or Director or by his or her family Members. Annually, each officer and Director shall complete a disclosure statement reflecting his or her interests.

Directors shall act in a manner intended to further the best interests of the Corporation. If at any time a Director (i) has or may have a conflict of interest, or (ii) is unable to act in the best interests of the Corporation on any issue because of a personal situation, employment, conflicting interest, or other reason, the Director shall recuse himself or herself from voting on the subject and shall leave the room while the matter is discussed. Recusing himself or herself shall not prevent a Director from participating in other activities or discussions where no conflict of interest exists.

The Board may approve a transaction that is the subject of a conflict only if it has determined (i) that the transaction or arrangement is in the Corporation’s best interest and for its own benefit, (ii) that it is fair and reasonable to the Corporation, and (iii) after exercising due diligence, the Corporation would not obtain a more advantageous transaction with reasonable efforts under the circumstances. Where appropriate the Board shall obtain comparable information to assist it in reaching such conclusions.

The minutes of all meetings shall reflect (i) the names of the persons who disclosed any conflicts; (ii) the determination as to whether an actual or potential conflict of interest existed; (iii) the names of the persons who were present for discussions and votes relating to the transaction or arrangement; (iv) the content of the discussions, including any alternatives to the proposed transaction or arrangement and the basis for the determination of the Board, including any comparability data; (v) the voting record, including any abstention from voting; and (vi) any action to be taken.

Section 7.11 Definition of Code.

Unless the context requires otherwise, terms used in this Article VII of these Bylaws shall have the meanings ascribed to them in the Code. References to the Code in this Article shall be deemed to extend to corresponding provisions of any subsequent United States tax laws. The provisions of this Article shall apply notwithstanding other provisions of these Bylaws, if any, which are inconsistent.

Section 7.12 Restriction of Activities.

No substantial part of the activities of the corporation shall be the carrying on of propaganda, or otherwise attempting to influence legislation (except as otherwise provided by Internal Revenue Code Section 501(h), or participating in, or intervening in (including the publication or distribution of statements), any political campaign on behalf of any candidate for public office.