Amended
and Restated Bylaws
of
The
Freedom Academy Foundation
Article
I
Limitation
on Activities
Section 1.1 No substantial part of the activities of this
Foundation shall be the carrying on of propaganda, or otherwise attempting to
influence legislation (except as otherwise provided by Section 501 (h) of the
Internal Revenue Code), and this Foundation shall not participate in, or
intervene in (including the publishing or distribution of statements), any
political campaign on behalf of, or in opposition to, any candidate for public
office. Notwithstanding any other
provision of these Bylaws, this Foundation shall not carry on any activities
not permitted to be carried on: (A) by a corporation exempt from federal income
tax under Section 501 (c) (3) of the Internal Revenue Code; or (B) by a
corporation, contributions to which are deductible under Section 170 (c) (2) of
the Internal Revenue Code.
Offices
Section 1.1. Business Offices. The principal office of THE FREEDOM
ACADEMY FOUNDATION (the “Foundation”)
shall be located at 1190 West 900 North,
Section 1.2. Registered Office. The registered office of the
Foundation required by Title 16, Chapter 6a Utah Code Annotated 1953, as
amended (the “Act”) may be, but need
not be, the same as the Foundation’s principal business office in Utah. The initial registered office is the same as
the initial principal office referenced above, but is subject to change from
time to time by the Governing Board, by the officers of the Foundation, or as
otherwise provided by the Act.
Members
Section 2.1. Annual Meetings. No annual meetings of the Members shall be held. However, during the second week of November Members shall elect the Board Members (as defined below) in accordance with the procedures described herein. If the election of Board Members shall not be held at the time designated herein, the Governing Board shall cause the election to be held at a special meeting of the Members to be convened as soon thereafter as may be convenient. The Governing Board may from time to time by resolution change the date and time for the election of Board Members.
Section 2.2. Special Meetings. Special meetings of the Members may be called by the Governing Board, the CAO, or upon the written request of Members holding not less than ten percent (10%) of the total votes held by all Members, such written request to state the purpose or purposes of the meeting and to be delivered to the Governing Board or the CAO
Section
2.3 Place of Meetings. The Governing Board may designate any place
in
Section 2.4 Notice of
Meetings. The Governing Board shall
cause written or printed notice of the time, place, and purposes of all
meetings of the Members (whether annual or special) to be delivered, not more
than fifty (50) nor less than
ten (10) days prior to the meeting, to each Member of record entitled to vote
at such meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the
Section 2.5 Members of Record. Member is defined as the custodial parent(s) or legal guardian(s) of each student currently accepted in the school. Should a student have more than one custodial parent or legal guardian, the parents or legal guardians of such student shall collectively be one Member and shall act unanimously to the votes relating to their joint Membership. For the purpose of determining Members entitled to notice of or to vote at any meeting of the Members, or any adjournment thereof, the Governing Board may designate a record date, which shall not be more than fifty (50) nor less than ten (10) days prior to the meeting, for determining Members entitled to notice of or to vote at any meeting of the Members. If no record date is designated, the date on which notice of the meeting is mailed shall be deemed to be the record date for determining Members entitled to notice of or to vote at the meeting. The persons appearing in the records of the Foundation on such record date as custodial parents or legal guardians of students currently accepted in the school shall be deemed to be the Members of record entitled to notice of and to vote at the meeting of the Members. The membership provisions of these bylaws may be altered from time to time in accordance with the Act, the Articles of Incorporation of the Foundation, and these bylaws to provide for the classification, qualifications, privileges and appointment of members as may be determined by the Governing Board.
Section 2.6 Quorum. At any meeting of the Members, the presence of Members holding, or holders of proxies entitled to cast, more than forty percent (40%) of the total votes held by all Members shall constitute a quorum for the transaction of business. In the event a quorum is not present at a meeting, the Members present (whether represented in person or by proxy), though less than a quorum, may adjourn the meeting to a later date. Notice thereof shall be delivered to the Members as provided above. At the reconvened meeting, the Members and proxy holders present shall constitute a quorum for the transaction of business. The quorum requirement is not applicable to the board elections described below in paragraph 2.11.
Section 2.7 Proxies. At each meeting of the Members, each Member entitled to vote shall be entitled to vote in person or by proxy; provided, however, that the right to vote by proxy shall exist only where the instrument authorizing such proxy to act shall have been executed by the Member himself or by his attorney thereunto duly authorized in writing. If a Membership is jointly held, the instrument authorizing a proxy to act must have been executed by all holders of such Membership or their attorneys thereunto duly authorized in writing. Such instrument authorizing a proxy to act shall be delivered at the beginning of the meeting to such officer or person who may be acting as secretary of the meeting. The secretary of the meeting shall enter a record of all such proxies in the minutes of the meeting.
Section 2.8 Votes. With respect to each mailer submitted to a vote of the members, each Member entitled to vote shall have the right to cast, in person or by proxy, one vote. The affirmative vote of a majority of the votes entitled to be cast by the Members present or represented by proxy at a meeting at which a quorum was initially present shall be necessary for the adoption of any matter voted on by the Members, unless a greater proportion is required by the Articles of Incorporation, these Bylaws, the Declaration, or Utah law. Notwithstanding anything contained herein, the election of Board Members shall be in accordance with Section 2.11 hereinbelow. If a membership is jointly held, all or any holders thereof may attend each meeting of the Members, but such holders must act unanimously to cast the votes relating to their joint Membership.
Section 2.9 Waiver of Irregularities. All inaccuracies and irregularities in calls or notices of meetings and in the manner of voting form of proxies, and method of ascertaining Members present shall be deemed waived if no objection thereto is made at the meeting.
Section 2.10 Informal Actions. Any action that is required or permitted to be taken at a meeting of the Members may be taken without a meeting, if a consent in writing, setting forth the action so taken, shall be signed by all of the Members entitled to vote with respect to the subject matter thereof.
Section 2.11. Board Elections.
(a) Elections to the Governing Board are held in the second week of November of each school year. Non-November elections may be held in cases in which a sitting board member has resigned his or her seat midway through term or in cases of board member recall. Elections may be held off of the November cycle under these stated conditions with a majority vote of the board. As an alternative to an off-cycle election, the chief administrative officer (CAO) may appoint an individual to fill the vacated seat until the next election. Any appointments to board positions must be approved by a majority of the board.
(b) Board
elections are coordinated and orchestrated by sitting board members. Board elections
shall be in accordance with the following procedures:
(i)
Notice of
elections is given and nominations to the board are accepted beginning six (6)
weeks prior to the election
(ii)
The submission of
a platform statement personally authored by each board candidate submitted
three (3) weeks prior to the election
(iii)
A one week period
for preparation of an election booklet
(iv)
Election booklets
sent out to parents two (2) weeks prior to the election with notice of an
upcoming “meet the candidates” meeting
(v)
A public “meet
the candidates” meeting attended by all board candidates one (1) week prior to
the election; the meeting is a question and answer format
(vi)
Numbered
take-home ballots provided to each family three (3) days before the election
(one vote per family)
(vii)
Counting of
ballots supervised by the Utah County Board of Elections or other authorized
body; results certified by the designated external body
(viii)
Public
announcement of the election outcome including percentage of cast votes and
vote counts received by each candidate.
(c) Following voting, candidates are ranked in order from the candidate
receiving he greatest number of votes to the candidate receiving the fewest
votes until open seats are filled. Any
candidate receiving less than twenty-five percent (25%) of the vote cast by the
voting members is deemed not to have been successful in their bid for a board
seat, irrespective of whether all seats have been filled. If, following the election, open board seats
remain, the seats are filled following the procedures of 2.11(a) above.
(d) The
board elects board members to the CAO and CFO roles (as those terms are defined
below) at the first governing board meeting following the election in the term
in which the sitting CAO or CFO expires.
The CAO and CFO will continue in their position until the end of their
term.
(e) At the
first governing board meeting following the election, or in the event of a CAO
or CFO resignation prior to the end of the term, the board elects the CAO or
CFO from among its body. The CAO and the
CFO role assignments are determined through a secret ballot process at the
board. The board votes on the CAO role
first, and then the CFO role. To begin,
board members nominate individuals on the board for one of the roles. Following nominations, voting proceeds by
secret ballot and results are tallied by the academy director. When more than two nominees are slated for a
position, voting proceeds in a minimum of two rounds. After the first round, the two members
receiving the most votes are advanced for consideration to the second
round. The final round votes are cast
between two candidates. In the event
that nominations for only one candidate are received, members may still vote
for the candidate of their choice, even if that candidate is not on the
nomination slate in the first round. A
simple majority is sufficient to elect.
Governing
Board
Section 3.1. General Powers. The business and affairs of
the Foundation shall be managed by its Governing Board, except as otherwise
provided in the Act, the Articles of Incorporation or these bylaws.
Section 3.2 Number, Election, Tenure and Qualifications. The number of
Members of the Governing Board shall be seven (7), each being hereafter
referred to as a ABoard Member.@ The Board Members shall have a term of two
(2) years ending in November, occurring two calendar years following their election
and until their successors are duly elected and qualified, or until their prior
removal, death or resignation. If a
Board Member is elected at a time other than the November election, his or her
term nevertheless expires two years following the next November election. The Foundation=s
director also sits on the Board as a non-voting (ex-officio) Member. Paid employees of the Foundation may not
serve as voting Board Members. Sometime
prior to the opening of nominations for election, the Board shall determine
which existing seats will be up for nomination in the next election. In any election where more than three (3)
Board seats will be open for reelection, the Board shall, by lot, choose
Members to receive a one-year extension until the number of running Members is
reduced to three (3).
Section 3.3.
Vacancies. Any
Board Member may resign at anytime by giving written notice to at least two
other Board Members. Such resignation shall take
effect at the time specified therein, and unless otherwise specified therein,
the acceptance of such resignation shall not be necessary to make it
effective. Any vacancy occurring in the Governing
Board shall be filled in the same manner as set forth for the appointment of
such Board Member in Section 3.2(b). A Board
Member appointed to fill a vacancy shall serve for the remaining term of the Board
Member he or she replaces and must meet the qualifications applicable to the
position on the Governing Board to be filled.
If any question arises concerning the application of Section 3.2(b) to
the election or appointment of Board Members, such question shall be resolved
in deference to the continued qualification of the Foundation under IRC
§§501(c)(3) and 509(a)(3).
Section
3.4. Standards of Conduct. A Board Member shall
discharge his or her duties as Board Member:
(a) In good faith;
(b) With the care an ordinarily prudent
individual in a like position would exercise under similar circumstances; and
(c) In a manner the Board Member reasonably
believes to be in the best interest of the Foundation.
Section
3.5 Regular Meetings. Regular
meetings of the Governing Board shall be held at least once each quarter at
such time and place as may be determined by the Governing Board, for the purpose of
transaction of such business as may come before the meeting. The Governing Board may provide by resolution
the time and place, either within or outside the State of
Section 3.6. Special Meetings. Special meetings of the Governing
Board may be called by or at the request of any two Board Members. The individual or individuals authorized to
call special meetings of the Governing Board may fix any place as the place,
either within or outside
Section 3.7. Annual Meetings. One of the regular meetings
of the Governing Board described above in Section 3.5 shall be designated as
the Annual Meeting for the purposes of organization, election of officers and
the transaction of other business.
Section 3.8. Notice. Notice of each meeting of
the Governing Board stating the place, day and hour of the meeting shall be
given to each Board Member at the Board Member’s business address at least five
days prior thereto by the mailing of written notice by first class, certified
or registered mail, or at least two business days prior thereto by personal
delivery of written notice or by telephonic, telegraphic, electronic or
facsimile notice (and the method of notice need not be the same as to each Board
Member). If mailed, such notice shall be
deemed to be given when deposited in the
Section 3.9. Quorum, Voting, Procedure, and Super Majority
Decisions. Five (5) of the seven (7) Board
Members shall constitute a quorum for the transaction of business at any
meeting of the Governing Board except in cases where a super-majority decision
is required, and, except for the election and appointment of Board Members, the
vote of a majority of the Board Members present in person at a meeting at which
a quorum is present shall be the act of the Governing Board. If less than a quorum is present at a
meeting, business may discussed by the Board Members present provided that no
decision may be made by the Board. In
addition, if less than a quorum is present at a meeting, a majority of the Board
Members present may adjourn the meeting from time to time without further
notice other than an announcement at the meeting, until a quorum shall be
present. No Board Member may vote or act
by proxy at any meeting of Board Members.
The CAO or his or her designate chairs Board meetings. Before a vote can be taken at the board, a
motion for the same must be made by a board member and that motion must be
seconded. Several specific types of
decisions require six (6) of seven (7) votes before the Board may act. Such
decisions pertain to major strategic turning points for the school. They
include: (1) Major real estate or development transactions, leasehold
improvements, or capital expenditures totaling $10,000 or more; (2) dismissal
of the Academy Director; (3) a movement to change the Freedom Academy by-laws
or Freedom Academy Charter (the changes to which must also be voted on by the
parent body with a majority to be successful); (4) Direct removal of a Board Member.
Section 3.10. Presumption of Assent. A Board
Member of the Foundation who is present at a meeting of the Governing Board at
which action on any corporate matter is taken shall be presumed to have
assented to the action taken unless the Board Member, at the beginning of the
meeting, objects to holding the meeting or transacting business at the meeting,
and after objecting, does not vote for or assent to any action taken at the
meeting. The Board Member must also, at
the same time, request that his or her dissent shall be entered in the minutes
of the meeting, or file his or her written dissent to such action with the
presiding officer of the meeting before the adjournment thereof or with the Foundation
promptly after adjournment of the meeting.
The Board Member shall forward such dissent by registered mail to the
secretary of the Foundation immediately after the adjournment to the
meeting. No Board Member may dissent
regarding an action for which the Board Member voted in favor.
Section 3.11. Compensation. Board Members shall not
receive compensation for their services as such, although the reasonable
stipends and expenses for Board Members for attendance at Governing Board
meetings may be paid or reimbursed by the Foundation. Board Members shall not be disqualified to
receive reasonable compensation for services rendered to or for the benefit of
the Foundation in any other capacity.
Section 3.12. Executive and
Other Committees. The CAO may designate from among Board Members an
executive committee and one or more other committees. Board committees are chaired or co-chaired by
one or more board members and may include parents, teachers, or other members
of the community. Committees are responsible to the Governing Board for the
discharge of their duties and responsibilities. Committees are not separate
decision-making bodies but are instead charged to develop recommendations,
proposals, plans, or perspectives that may be used by the board in the
discharge of Governing Board duties. Board committees may be convened around
any topic or objective. Typical committees include education, finance, hiring,
long-range planning, communications, facilities, or others as needed. The delegation of authority to any committee
shall not operate to relieve the Governing Board or any member of the Governing
Board from any responsibility imposed by law.
Rules governing procedures for meetings of any committee of the Governing
Board shall be as established by the Governing Board, or in the absence
thereof, by the committee itself.
Section 3.13. Board Meetings to Be Public. All meetings of the Governing Board, whether
Regular, Special, or Annual, shall comply with the Utah Open and Public Meetings
Act (Utah Code Ann. 52-4-1 et. seq.) except
that, upon a vote of a majority of the Board Members present, an executive
session may be held to discuss any one or more of the following: (1)
attorney-client matters; (2) matters
subject to negotiations, and (3) personnel matters. The motion requesting the
executive session shall state the nature of the matter to be discussed. Only
those persons invited by the Board may be present during the executive session.
The Board shall not make final policy decisions, nor shall any resolution,
rule, regulation, or formal action or any action approving a contract or
calling for the payment of money be adopted or approved at any session which is
closed to the general public. Matters discussed during executive sessions shall
remain confidential among those attending..
Agenda items for board meetings may be provided by anyone from the
school community but must be submitted to the CAO by email or otherwise a
minimum of three (3) days before a public meeting. The CAO may choose to
prioritize or reject agenda items at his or her discretion. The agenda is
posted a minimum of twenty-four (24) hours prior to the public board meeting. A
period for public comment is designated at each meeting with the length of the
comment period to be determined by the CAO. The public does not participate in
board meetings outside of the public comment period except by invitation of the
CAO or his or her designate during the course of the meeting.
Section 3.14.
Removal of a Board Member.
The impetus for removal of a board
member may come from either members of the board or from a member of the parent
body.
(a) Impetus
coming from another board member. When the impetus for removing a board member
comes from a member of the board, the following steps must be followed:
(1) A letter of grievance is delivered to the CAO;
(2) The CAO, at his or her sole discretion may call a
meeting between the CAO, the aggrieved party, and the accused board member to
address the issue(s) raised. (In the case in which the CAO is the target of the
removal campaign, the procedures in paragraph 2.9.3 must be followed). Possible
outcomes of the meeting are
a. proceed directly to step 3;
b. provide the accused board member a warning, which must
be committed to writing, and a timeline for improving or rectifying the
behavior giving rise to the charge;
c. targeted board member resigns;
d. the incident is dropped.
In the case of outcome (b), the effort to remove the
board member halts until it is taken up again at the deadline set forth in (b).
In the case of outcome (c), paragraph 2.3 (Board Elections) is followed. In the
case of outcome (d), or in the case in which the CAO refuses to call a meeting
between the aggrieved and the accused, the matter is dropped. The aggrieved
party may then elect to follow the procedures of paragraph 2.9.3 at his or her
discretion.
(3) The matter is brought to a public meeting of the
board.
(b) Motion
in board meeting to remove board member or hold recall election. Following Step
3 of paragraph 2.9.1 the matter of the grievance must be placed on the board
agenda (see Section 2.16) for a public hearing. During the meeting, the
accusing party lays out the grievance. A period of board and public comment
follows. Following the discussion, a motion may be made to move to a vote on
whether to remove the board member. If the motion is seconded, the vote is
held, but a vote may not be held unless at least six (6) voting members of the
board are present. Six (6) out of seven (7) board votes removes the member from
the board directly. The board member’s term of service automatically ends at
the end of the six (6) out of seven (7) vote. Five (5) out of seven (7) votes
triggers a recall election. Fewer than five (5) votes fails to carry the
motion. If the board member is removed or a recall election is triggered, a
date is set for the election following the pattern outlined in paragraph 2.4.
In the case of a recall election, the board member up for recall is placed on
the ballot with any other parties interested in running for that board seat.
During the election, one or more board members may supply to the parent voting
body a rationale for recall at their discretion. The board member who is the
focus of the recall functions in their board role until the outcome of the
election is known.
(c) Impetus
coming from a parent or teacher. When the impetus for removing a board member
comes from a parent or a board member who is unable to generate support for his
or her cause at the board, or when the CAO is the target of the removal
campaign, the following steps must be followed: (1) The parent/teacher creates
a petition to hold a recall election for the targeted board member. The
petition is considered successful when twenty-five (25) percent of families
currently enrolled at the school have signed. (2) The successful petition is brought
to a public meeting of the board. If the petition contains the requisite number
of signatures (to be verified by the board), a recall election is triggered
automatically, following which the procedures of paragraph 2.4 are followed.
Officers
and Agents
Section
4.1 Number and Qualifications. The
officers of the Foundation shall be Chief Administrative Officer (ACAO@) and a Chief Financial Officer (ACFO@). The CAO must
be a Member of record. The CAO and CFO must be Members
of the Foundation. The CAO may assign
other roles on the Governing Board in cooperation with Board Members. These roles may change at the discretion of
the CAO and are based upon the governance needs of the school. Generally, however, roles for communication
officer, education officer, technology officer, or strategic planning officer
may be assigned. Roles could also
include compliance, facilities, infrastructure, or others. The Governing Board may also elect or appoint
such other officers, assistant officers and agents, as it may consider
necessary. One individual may hold more
than one office at a time.
Section
4.2. Power/Duties. The Governing Board may delegate to any
officer of the Foundation or any committee of the Governing Board the power to
appoint, remove and prescribe the duties of other officers, assistant officers,
agents and employees.
Section
4.3. Resignation. An officer may resign at any time by giving
written notice of resignation to the Governing Board. An officer’s resignation shall take effect at
the time specified in the notice, and unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it effective.
Section 4.4. Election and Term of Office. The president, secretary and
treasurer of the Foundation shall be elected by the Governing Board at each
annual meeting. If the election of such
officers shall not be held at such meeting, such election shall be held as soon
as convenient thereafter. Each officer
shall hold office until the officer’s successor shall have been duly
designated, elected and shall have qualified, or until the officer’s earlier
death, resignation or removal.
Section
4.5. Removal. An officer, assistant, agent or employee may
be removed only in accordance with these Bylaws, the Foundation’s Charter, and
the Foundation’s Employee Handbook.
Section
4.6. Vacancies. A vacancy in any office
because of death, resignation, removal, disqualification or otherwise may be
filled by the Governing Board for the unexpired portion of the term.
Section 4.7. Compensation. The compensation of the
officers shall be fixed from time to time by the Governing Board based upon the
fair value of services rendered by such officers, and no officer shall be
prevented from receiving such compensation by reason of the fact that he or she
is also a Board Member of the Foundation.
Section 4.8. Authority and Duties of Officers. The officers of the Foundation
shall have the authority and shall exercise the powers and perform the duties
specified below and as may be additionally specified by the president, the Governing
Board or these bylaws, except that in any event each officer shall exercise
such powers and perform such duties as may be required by law.
(a) CAO. The CAO oversees board activities; acts as
decision maker of final resort for non-voting issues; directly supervises
school administration with input from other board members; organizes,
facilitates, and presides at board meetings; communicates frequently with
parents on behalf of the board; acts as primary representative of the school to
state and regulatory bodies; performs all other duties of administration
outlined herein.
(b) CFO. The CFO oversees budgeting process and
planning; prepares financial reports; administers financial controls; co-signs
expenditure checks with Academy Director; secures funding and other sources of
revenue; files state financial reports; oversees grant-writing together with
Academy Director; frequently reports on financial status of the Academy to the
board.
Section 4.9. Multiple Offices. An individual may hold more than one office
of the Foundation.
Section 4.10. Surety Bonds. The Governing Board may
require any officer or agent of the Foundation to execute to the Foundation a
bond in such sums and with such sureties as shall be satisfactory to the Governing
Board, conditioned upon the faithful performance of such individual’s duties
and for the restoration to the Foundation of all books, papers, vouchers, money
and other property of whatever kind in such individual’s possession or under
such individual’s control belonging to the Foundation.
Execution
Of Instruments
Section
5.1. Checks, Drafts, etc. All
checks, drafts and orders for payment of money, and notes or other evidences of
indebtedness issued in the name of the Foundation shall be signed by such
officer or officers, or agent or agents of the Foundation and in such manner as
shall from time to time be determined by resolution of the Governing Board.
Section 5.2 Deposits. All
funds of the Foundation not otherwise employed shall be deposited from time to
time to the credit of the Foundation in such banks, trust companies or other
depositaries as the Governing Board may select.
Section
5.3. Contracts. The Governing Board may
authorize any officer or officers, or agent or agents, to enter into any
contract or execute and deliver any instrument in the name of and on behalf of
the Foundation, and such authority may be general or confined to specific
instances.
Section 5.4. Conflicts of
Interest. The Board Members and officers of the Foundation
shall have no undisclosed economic interest in the process of securing contracts. No bid or contract, other than an employment
contract as an officer of the Foundation, may be awarded to (i) a Board
Member or officer of this Foundation, (ii) any entity which such
individual owns, directly or indirectly or through relatives, more than
thirty-five percent (35%) of the voting interest thereof, (iii) any entity
of which such individual is a Board Member or officer, or has a financial
interest, or (iv) a relative of such individual, meaning his or her
spouse, ancestor, brother, sister, children, grandchildren or the spouses of
brothers, sisters, children or grandchildren, unless such relationship has been
disclosed to the Governing Board and the Governing Board or committee thereof
in good faith authorizes the award by the affirmative vote of a majority of the
disinterested Board Members, even though the disinterested Board Members are
less than a quorum.
Power Of
The Board To Borrow Money
The Governing Board shall have full
power and authority to borrow money whenever in the discretion of the Governing
Board the exercise of such power is required in the general interests of this Foundation,
and in such case the Governing Board may authorize the proper officers of this Foundation
to make, execute and deliver in the name of and in behalf of this Foundation
such notes, bonds and other evidences of indebtedness as the Governing Board
shall deem proper, and the Governing Board shall have full power to mortgage
the property of this Foundation, or any part thereof, as security for such
indebtedness, and no further action shall be requisite to the validity of any
such note, bond, evidence of indebtedness or mortgage.
Indemnification
(a) To the extent allowed by the Articles of
Incorporation and law, the Foundation shall indemnify
against reasonable expenses incurred in the proceeding, any Board Member or
officer who was successful on the merits in any proceeding or matter in the
proceeding, to which the Board Member was a party by reason of having served as
a Board Member or officer of the Foundation.
(b) The Foundation may indemnify an individual made a party to a proceeding because the
individual is or was a Board Member, officer, employee, fiduciary or agent of
the Foundation or of any other corporation at the request of the Foundation, or
by reason of any action alleged to have been taken, omitted or neglected as
such Board Member, officer, employee, fiduciary or agent against reasonable
expenses incurred in connection with the proceeding, if:
1. the individual’s conduct was in good
faith;
2. the individual reasonably believed that
the individual’s conduct was in the corporation’s best interests; and
3. in the case of any criminal proceeding,
the individual had no reasonable cause to believe the individual’s conduct was
unlawful.
(c) The Foundation shall not indemnify a Board
Member, or officer, employee, fiduciary, or agent in connection with a
proceeding in which such individual was adjudged liable to the Foundation, or
in connection with any other proceeding charging that the individual derived an
improper personal benefit, whether or not involving action in the individual’s
official capacity, in which proceeding the individual was adjudged liable on
the basis that the individual derived an improper personal benefit.
Section
7.2. Advances of Costs and Expenses. The Foundation may pay for reasonable
expenses incurred by a Board Member, officer, employee or agent (in defending a
civil or criminal action, suit or proceeding) who is a party to a proceeding in
advance of final disposition of the proceeding if:
(i) the
individual furnishes the Foundation a written affirmation of the individual’s
good faith belief that the individual has met the applicable standard of
conduct described above in Section 8.1.
(ii) the
individual furnishes the Foundation a written undertaking, executed personally
or on the individual’s behalf, to repay the advance, if it is ultimately
determined that the individual did not meet the standard of conduct; and
(iii) a
determination is made that the facts then know to those making the
determination would not preclude indemnification.
Section 7.3. Insurance. By action of the Governing
Board, notwithstanding any interest of the Board Members in such action, the Foundation
may, subject to Section 7.5, purchase and maintain insurance, in such amounts
as the Governing Board may deem appropriate, on behalf of any individual
indemnified hereunder against any liability asserted against such individual
and incurred by such individual in such individual’s capacity of or arising out
of such individual’s status as an agent of the Foundation, whether or not the Foundation
would have the power to indemnify such individual against such liability under
applicable provisions of law. The Foundation
may also purchase and maintain insurance, in such amounts as the Governing
Board may deem appropriate, to insure the Foundation against any liability,
including without limitation, any liability for the indemnifications provided
in this Article.
Section 7.4. Right to Impose Conditions to Indemnification. The Foundation shall have
the right to impose, as conditions to any indemnification provided or permitted
in this Article, such reasonable requirements and conditions as the Governing
Board may deem appropriate in each specific case, including but not limited to
any one or more of the following:
(a) that any counsel representing the individual to be indemnified
in connection with the defense or settlement of any action shall be counsel
that is mutually agreeable to the individual to be indemnified and to the Foundation;
(b) that the Foundation shall have the right, at its option, to assume and
control the defense or settlement of any claim or proceeding made, initiated or
threatened against the individual to be indemnified; and (c) that the Foundation
shall be subrogated, to the extent of any payments made by way of
indemnification, to all of the indemnified individual’s right of recovery, and
that the individual to be indemnified shall execute all writings and do
everything necessary to assure such rights of subrogation to the Foundation.
Section 7.5. Limitation on Indemnification. Notwithstanding any other
provision of these bylaws, the Foundation shall neither indemnify any
individual nor purchase any insurance in any manner or to any extent that would
jeopardize or be inconsistent with qualification of the Foundation as an
organization described in Section 501(c)(3) of the Internal Revenue Code or
would result in liability under Section 4941 of the Internal Revenue Code.
Limitation
on Liability
No Board Member or officer of this Foundation shall
be personally liable to the Foundation for civil claims arising from acts or
omissions made in the performance of such individual’s duties as a Board Member or officer, unless the
acts or omissions are the result of such individual’s intentional misconduct.
Limitations
Section 9.1. Prohibition Against Sharing in Corporate
Earnings. No Board
Member, officer or employee of or individual or entity connected with the Foundation,
or any other private individual shall receive at any time any of the net
earnings or pecuniary profit from the operations of the Foundation, provided
that this shall not prevent the payment to any such individual or entity of
such reasonable compensation for services rendered to or for the Foundation in
effecting any of its purposes as shall be fixed by the Governing Board; and no
such individual or individuals shall be entitled to share in the distribution
of any of the corporate assets upon the dissolution of the Foundation. All Board Members of the Foundation shall be
deemed to have expressly consented and agreed that upon such dissolution or
winding up of the affairs of the Foundation, whether voluntary or involuntary,
the assets of the Foundation, after all debts have been satisfied, then
remaining in the hands of the Governing Board shall be distributed,
transferred, conveyed, delivered, and paid over, in such amounts as the Governing
Board may determine or as may be determined by a court of competent
jurisdiction upon application of the Governing Board, exclusively to
charitable, religious, scientific, literary, or educational organizations which
would then qualify under the provisions of Section 501(c)(3) of the Internal
Revenue Code of 1986 and the regulations promulgated thereunder as they now
exist or as they may hereafter be amended.
Section 9.2. Investments. The Foundation
shall have the right to retain all or any part of any securities or property
acquired by it in whatever manner, and to invest and reinvest any funds held by
it, according to the judgment of the Governing Board, without being restricted
to the class of investments which a nonprofit corporation is or may hereafter
be permitted by law to make, or any similar restriction, provided, however,
that no action shall be taken by or on behalf of the Foundation if such action
is a prohibited transaction or would result in the denial of the tax exemption
under Sections 502 or 503 or any other Section of the Internal Revenue
Code of 1986 and the Regulations promulgated thereunder as they now exist or as
they may hereafter be amended.
Section 9.3. Exempt Activities. Notwithstanding
any other provision of these bylaws, no Board Member, officer, employee, or
representative of this Foundation shall take any action or carry on any
activity by or on behalf of the Foundation not permitted to be taken or carried
on by a supporting organization exempt under Section 509(a)(3) of the
Internal Revenue Code of 1986 and the Regulations promulgated thereunder as
they now exist or as they may hereafter be amended, or by an organization
contributions to which are deductible under Section 170(c)(2) of such Code
and the Regulations promulgated thereunder as they now exist or as they may
hereafter be amended.
Miscellaneous
Section 10.1. Account Books, Minutes, Etc. The Foundation shall keep
correct and complete books and records of account and shall also keep minutes
of the proceedings of its Governing Board and committees. All books and records of the Foundation may
be inspected by any Member, such Member’s authorized agent or attorney, for any
proper purpose at any reasonable time.
Section 10.2. Fiscal Year. The fiscal year of the Foundation
shall be as established by the Governing Board.
Section 10.3. Conveyances and Encumbrances. Property of the Foundation
may be assigned, conveyed or encumbered by such officers of the Foundation as
may be authorized to do so by the Governing Board, and such authorized
individuals shall have power to execute and deliver any and all instruments of
assignment, conveyance and encumbrance; however, the sale, exchange, lease or
other disposition of all or substantially all of the property and assets of the
Foundation shall be authorized only in the manner prescribed by applicable
statute.
Section 10.4. Designated Contributions. The Foundation may accept
any designated contribution, grant, bequest or devise consistent with its
general charitable and tax‑exempt purposes, as set forth in the Articles
of Incorporation. As so limited, donor‑designated
contributions will be accepted for special funds, purposes or uses, and such
designations generally will be honored.
However, the Foundation shall reserve all right, title and interest in
and to and control of such contributions, as well as full discretion as to the
ultimate expenditure or distribution thereof in connection with any special
fund, purpose or use. Further, the Foundation
shall acquire and retain sufficient control over all donated funds (including
designated contributions) to assure that such funds will be used to carry out
the Foundation’s tax‑exempt purposes.
Section 10.5. Loans to Board Members and Officers
Prohibited. No loans shall be made by
the Foundation to any of its Board Members or officers.
Section 10.6. References to Internal Revenue Code. All references in these
bylaws to provisions of the Internal Revenue Code are to the provisions of the
Internal Revenue Code of 1986, as amended, and shall include the corresponding
provisions of any subsequent federal tax laws.
Section 10.7. Amendment. The power to alter, amend,
restate or repeal these bylaws and adopt new bylaws or to alter, amend or
restate the Foundation’s Articles of Incorporation shall be vested in the Governing
Board. Any amendment must be approved by
an affirmative vote of six (6) of the seven (7) Board Members at any regular or
special meeting of the Governing Board.
Notwithstanding the foregoing to the contrary, any amendment,
restatement, or repeal of these bylaws shall be approved by a majority of the
Members.
Section 10.8. Severability. The invalidity of any
provision of these bylaws shall not affect the other provisions hereof, and in
such event these bylaws shall be construed in all respects as if such invalid
provision were omitted.
DATED
this ___ day of ___________, 2005.
___________________________________
_____________________________, CAO
___________________________________
_____________________________, CFO
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
G:\PACE\Mark\Freedom
Academy New Bylaws 2.doc
THE
FREEDOM ACADEMY FOUNDATION
Bylaws
Certificate
The
undersigned certifies that he is the Chief Administrative Officer of THE FREEDOM
ACADEMY FOUNDATION, a
Dated
effective as of the _____ day of ____________________, 2005.
_________________________________________
____________________________________,
CAO
G:\PACE\Mark\Freedom Academy
New Bylaws 2.doc