ARTICLE I — NAME AND OFFICES
Section 1.1 Name
The name of this corporation is Joey's Toy Drive (the "Corporation").
Section 1.2 Principal Office
The principal office of the Corporation for the transaction of its activities and affairs is located in Santa Clara County, California. The Board of Directors (the "Board") may change the principal office from one location to another by resolution. Any such change shall be noted in these Bylaws by the Secretary opposite this section, or this section may be amended to state the new location.
Section 1.3 Other Offices
The Board may at any time establish additional offices at any place or places where the Corporation is qualified to conduct its activities.
ARTICLE II — PURPOSES
Section 2.1 General Purpose
Joey's Toy Drive is a Bay Area nonprofit that brings new toys and essential items to children from birth through age 17 in low-income communities and unstable-housing situations. The Corporation accepts donations year-round and distributes through homeless shelters, partner agencies, and public events, with its largest effort concentrated in the holiday season.
Section 2.2 Specific Purpose
The Corporation is organized exclusively for charitable purposes within the meaning of Section 501(c)(3) of the Internal Revenue Code, or the corresponding section of any future federal tax code (the "Code"). Notwithstanding any other provision of these Bylaws, the Corporation shall not carry on any activities not permitted to be carried on (a) by a corporation exempt from federal income tax under Code Section 501(c)(3), or (b) by a corporation, contributions to which are deductible under Code Section 170(c)(2).
Section 2.3 Public Benefit Corporation
The Corporation is a nonprofit public benefit corporation organized under the California Nonprofit Public Benefit Corporation Law (California Corporations Code §§ 5110–6910) for public and charitable purposes. It is not organized for the private gain of any person.
Section 2.4 Limitations on Activities
No substantial part of the activities of the Corporation shall consist of carrying on propaganda, or otherwise attempting to influence legislation, and the Corporation 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. No part of the net earnings of the Corporation shall inure to the benefit of, or be distributable to, its directors, officers, or other private persons, except that the Corporation shall be authorized and empowered to pay reasonable compensation for services actually rendered and to make payments and distributions in furtherance of the purposes set forth in Section 2.2.
Section 2.5 Dedication of Assets
The property of the Corporation is irrevocably dedicated to the charitable purposes described in
Section 2.2. No part of the net earnings, properties, or assets of the Corporation, on dissolution or
otherwise, shall inure to the benefit of any private person or any director or officer of the Corporation. On liquidation or dissolution, all properties and assets remaining after payment, or provision for payment, of all debts and liabilities of the Corporation shall be distributed to one or more nonprofit funds, foundations, or corporations that are organized and operated exclusively for charitable purposes and that have established their exempt status under Code Section 501(c)(3).
ARTICLE III — NO MEMBERS
Section 3.1 No Statutory Members
The Corporation shall have no statutory members within the meaning of California Corporations Code Section 5056. Any action that would otherwise require approval by a majority of all members, or approval of the members, shall require only approval of the Board.
Section 3.2 Non-Voting Affiliates
The Board may, in its discretion, admit individuals or entities as non-voting affiliates of the Corporation (including, without limitation, donors, volunteers, advisors, and supporters). Non- voting affiliates shall have no membership rights under California Corporations Code Section 5056 and shall have no right to vote, no fiduciary duties to the Corporation, and no right to inspect corporate records by reason of such affiliate status.
ARTICLE IV — BOARD OF DIRECTORS
Section 4.1 Powers
Subject to the provisions and limitations of the California Nonprofit Public Benefit Corporation Law, any other applicable laws, and any limitations in the Articles of Incorporation or these Bylaws, the activities and affairs of the Corporation shall be conducted, and all corporate powers shall be exercised, by or under the direction of the Board.
Section 4.2 Number of Directors
The number of directors shall be not less than three (3) and not more than seven (7), with the exact authorized number to be fixed from time to time by resolution of the Board. The number of directors initially authorized is four (4).
Section 4.3 Qualifications
Directors shall be of legal age. The Board may, by resolution, adopt additional qualifications for directors that are not inconsistent with these Bylaws or applicable law.
Section 4.4 Restrictions on Interested Directors
No more than forty-nine percent (49%) of the persons serving on the Board at any time may be "interested persons." For the purpose of this Section, "interested person" means: (a) any person being compensated by the Corporation for services rendered to it within the previous twelve (12) months, whether as a full-time or part-time employee, independent contractor, or otherwise; (b) any brother, sister, ancestor, descendant, spouse, brother-in-law, sister-in-law, son-in-law, daughter-in-law, mother-in-law, or father-in-law of any such person; or (c) any person currently holding an office or position of material financial interest in any entity that has a material financial relationship with the Corporation, as defined by California Corporations Code Section 5227. Any violation of this Section shall not affect the validity or enforceability of any transaction entered into by the Corporation. At the time of adoption of these Bylaws, no director or officer of the Corporation receives or is entitled to receive compensation from the Corporation for services rendered. Accordingly, no director currently qualifies as an "interested person" within the meaning of California Corporations Code § 5227, and the Corporation is in full compliance with the forty-nine percent (49%) limitation. The Board shall revisit compliance with this Section before authorizing any compensation arrangement for a person who is, or whose family member is, a director.
Section 4.5 Selection of Directors
Except for the Founder Director Seat described in Section 4.5A, directors shall be elected by the Board at each annual meeting of the Board, or at a special meeting of the Board called for that purpose. Each director elected shall hold office for the term specified in Section 4.6, unless the director dies, resigns, is removed, or otherwise becomes disqualified to serve. Each sitting director whose term has not expired and who remains qualified shall continue in office, and new or replacement directors shall be elected to fill any vacancy or expired term. At all times a majority of directors shall have been selected other than by officers of the Corporation.
Section 4.5A Founder Director Seat
Joseph Childs (the "Founder"), as the founder of the Corporation, shall serve as a director of the Corporation for so long as he serves as President or Executive Director of the Corporation (the "Founder Director Seat"). The Founder's term as a Director under this Section shall coincide with his term in the office of President or Executive Director that qualifies him for the Founder Director Seat. The Founder Director Seat is not subject to election or removal except as provided in Section 4.9, and the Founder shall not be required to stand for re-election so long as he holds the office of President or Executive Director. If the Founder ceases to serve as President or Executive Director, the Founder Director Seat shall be treated as a vacancy to be filled in accordance with Section 4.7. This Section is adopted pursuant to California Corporations Code § 5220(f), which authorizes a director to serve by virtue of holding a specified office of the corporation, with such director's term of office coinciding with the term of the office held.
Section 4.6 Term of Office
Directors (other than the Founder pursuant to Section 4.5A) shall serve for terms of one (1) or two (2) years, as determined by the Board at the time of election. To provide for staggered terms, at or prior to the first annual meeting of the Board, the Board shall divide the directors (other than the Founder) into two classes as equal in number as possible: one class to serve an initial term of one (1) year, and the second class to serve an initial term of two (2) years. When the authorized number of directors is an odd number, the extra director shall be placed in the class with the one-year initial term, unless the Board by resolution specifies otherwise at or before the first annual meeting. After the initial staggered terms, all directors shall serve terms of two (2) years. Each director shall serve until his or her successor has been elected and qualified, or until the director dies, resigns, is removed, or is otherwise disqualified to serve.
Section 4.7 Vacancies
A vacancy on the Board shall exist if any director dies, resigns, is removed, or is otherwise disqualified from serving, or if the authorized number of directors is increased. Vacancies on the Board, other than those caused by removal, may be filled by approval of the Board or, if the number of directors, then in office constitutes less than a quorum, by the affirmative vote of a majority of all directors then in office. A director elected to fill a vacancy shall serve until the next annual meeting of the Board at which directors are regularly elected, and until his or her successor has been elected and qualified. The Board shall fill any vacancy caused by removal at the meeting at which the removal occurs or at a subsequent meeting.
Section 4.8 Resignation
Any director may resign effective upon giving written notice to the Chair of the Board, the President, the Secretary, or the Board, unless the notice specifies a later time for the effectiveness of such resignation. If the resignation is effective at a future time, a successor may be elected to take office when the resignation becomes effective.
Section 4.9 Removal of Directors
Any director (other than the Founder Director Seat, which is governed by Section 4.5A) may be removed, with or without cause, by a vote of two-thirds (2/3) of the directors then in office at any regular or special meetings of the Board, provided that the director proposed to be removed has been given written notice of the proposed removal and the reasons therefor at least ten (10) days prior to the meeting. At the same meeting at which a director is removed, the Board shall either fill the resulting vacancy pursuant to Section 4.7 or, if it elects not to fill the vacancy immediately, shall record in the minutes the Board's determination regarding the timing of the vacancy fill.
Subject to applicable law, the Founder Director Seat, established under Section 4.5A pursuant to California Corporations Code § 5220(f), may be removed only for cause (including, without limitation, commission of a felony, gross negligence, or breach of fiduciary duty) by the unanimous vote of all directors then in office other than the Founder, and only after written notice to the Founder and an opportunity to be heard at a duly noticed Board meeting.
Section 4.10 Compensation
Directors shall serve without compensation, except that they may be reimbursed for actual and necessary expenses incurred in performing their duties as directors, as approved by the Board. Nothing in this Section shall be construed to prohibit any director from serving the Corporation in any other capacity and receiving reasonable compensation therefor, provided any such arrangement is approved in accordance with Section 12.2.
ARTICLE V — MEETINGS OF DIRECTORS
Section 5.1 Place of Meetings
Meetings of the Board shall be held at the principal office of the Corporation or at any other place designated by the Board, the Chair, or the President. Meetings may also be held via telephone conference or video conference, provided that all participants can communicate with each other simultaneously.
Section 5.2 Annual Meeting
An annual meeting of the Board shall be held once each year at a time and place determined by the Board. The annual meeting shall be held for the purpose of electing directors, electing or reappointing officers, and transacting such other business as may properly come before the Board.
Section 5.3 Special Meetings
Special meetings of the Board may be called by the Chair, the President, the Secretary, or any two (2) directors. Notice of a special meeting shall state the time and place of the meeting and, to the extent practicable, the purpose or purposes for which the meeting is called.
Section 5.4 Notice
Unless otherwise provided by these Bylaws, notice of each meeting of the Board shall be given to each director not less than forty-eight (48) hours prior to the meeting, by personal delivery, telephone (including voice message), electronic mail, facsimile, or first-class mail. Notice by mail shall be deemed given when deposited in the United States mail, postage prepaid, addressed to the director at his or her address as it appears on the records of the Corporation. Notice of a meeting need not be given to any director who signs a waiver of notice, whether before or after the meeting, or who attends the meeting without protesting the lack of notice prior to or at the commencement of the meeting.
Section 5.5 Quorum
A majority of the directors then in office, but not fewer than two (2), shall constitute a quorum for the transaction of business at any meeting of the Board. The directors present at a duly called and held meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors if any action taken is approved by at least a majority of the required quorum for such meeting.
Section 5.6 Voting
Every act or decision done or made by a majority of the directors present at a duly held meeting at which a quorum is present shall be regarded as the act of the Board, unless a greater number is required by law or these Bylaws. Each director shall have one vote on each matter submitted to a vote of the Board.
Section 5.7 Action Without a Meeting
Any action required or permitted to be taken by the Board may be taken without a meeting if all members of the Board individually or collectively consent in writing to such action. Such written consent or consents shall be filed with the minutes of the proceedings of the Board and shall have the same force and effect as a unanimous vote of the Board. Written consent may be transmitted and received by electronic mail or other electronic means, provided the identity of the consenting director is reasonably established.
Section 5.8 Adjournment
A majority of the directors present, whether or not constituting a quorum, may adjourn any meeting to another time and place. Notice of the time and place of holding an adjourned meeting need not be given unless the original meeting was adjourned to a time more than twenty-four (24) hours after the time of the original meeting, in which case notice shall be given to each director who was not present at the time of the adjournment in the manner required by Section 5.4.
Section 5.9 Teleconference and Video Conference Meetings
Directors may participate in a meeting through use of a telephone conference or video conference or similar communications equipment, so long as all directors participating in the meeting can hear each other at the same time. Participation in a meeting pursuant to this section constitutes presence in person at such meeting.
ARTICLE VI — COMMITTEES
Section 6.1 Committees of the Board
The Board may, by resolution adopted by a majority of the directors then in office, designate one or more committees to exercise certain powers and authority of the Board to the extent permitted by California law. Each committee shall consist of two (2) or more directors and shall serve at the pleasure of the Board. Meetings of committees shall be governed by the same rules regarding notice, quorum, action without meeting, and conduct as apply to the Board, except as the Board may otherwise determine. The Board may establish, modify, or dissolve any committee at any time. No committee may: (a) fill vacancies on the Board or in any committee; (b) adopt, amend, or repeal the Bylaws or Articles of Incorporation; (c) authorize compensation of directors for services as directors; (d) approve any transaction not in the ordinary course of business between the Corporation and one or more directors or between the Corporation and any entity in which one or more directors has a material financial interest; or (e) take any other action excluded from committee authority by California Corporations Code Section 5212.
Section 6.2 Advisory Committees
The Board may, by resolution, establish advisory committees composed of any persons, whether or not directors or officers of the Corporation. Advisory committees shall have no authority to act on behalf of the Corporation but may make recommendations to the Board and assist with the work of the Corporation as determined by the Board. The rules applicable to committees of the Board do not apply to advisory committees unless the Board so specifies.
Section 6.3 Advisory Board
The Board may establish an Advisory Board composed of individuals with expertise, experience, or influence relevant to the mission of the Corporation. Members of the Advisory Board shall serve in an advisory capacity only, shall have no authority to vote or act on behalf of the Corporation, and shall owe no fiduciary duty to the Corporation by reason of their service on the Advisory Board. Members of the Advisory Board shall serve at the pleasure of the Board of Directors. The Board may establish a charter or other guidelines governing the composition, qualifications, terms, and operation of the Advisory Board.
Section 6.4 Audit Committee
The Board shall establish an Audit Committee when required by California Government Code
Section 12586 (currently, when the Corporation's gross revenues equal or exceed two million
dollars ($2,000,000) in any fiscal year). The Audit Committee shall consist of at least two (2) directors, none of whom may be: (a) the President or Executive Director; (b) the Treasurer or Chief Financial Officer; or (c) any person with a material financial interest in any entity doing business with the Corporation. The Audit Committee shall be responsible for: (i) recommending to the Board the retention and termination of the independent auditor; (ii) reviewing the scope and results of each annual audit; (iii) reviewing the Corporation's internal control processes; and (iv) ensuring that management has implemented recommendations made by auditors. The Audit Committee shall report its findings and recommendations to the Board at least annually.
ARTICLE VII — OFFICERS
Section 7.1 Officers
The officers of the Corporation shall be a President, a Secretary, and a Treasurer/Chief Financial Officer, and such other officers as the Board may appoint. The Corporation may also have, at the discretion of the Board, an Executive Director and such assistant officers as the Board deems appropriate. The offices of President and Secretary may not be held by the same person.
Section 7.2 Election
Officers shall be elected by the Board at the annual meeting of the Board, and each officer shall hold office for one (1) year and until his or her successor is elected and qualified, unless the officer dies, resigns, is removed, or becomes otherwise disqualified to serve. During the Founder's lifetime, except when the Founder has resigned as President, been removed as President, is incapacitated, or is otherwise unwilling or unable to serve as President, election of any person other than the Founder as President shall require the affirmative vote of at least three-fourths (3/4) of the directors then in office other than the Founder (the Founder being excluded from both the numerator and the denominator for this purpose), and a written finding by the Board, set forth in the minutes, that such election is in the best interests of the Corporation.
Section 7.3 Subordinate Officers
The Board may appoint such other officers and agents as the business of the Corporation may require. Each such officer and agent shall hold office for such period, have such authority, and perform such duties as are provided in these Bylaws or as the Board may from time to time determine.
Section 7.4 Removal of Officers
Any officer may be removed with or without cause by a majority vote of the Board at any regular or special meeting of the Board. An officer appointed by another officer may also be removed by that other officer. Any removal shall be without prejudice to the rights, if any, of the officer under any contract of employment with the Corporation.
Section 7.5 Resignation of Officers
Any officer may resign at any time by giving written notice to the Board or to the President or Secretary of the Corporation, without prejudice to the rights, if any, of the Corporation under any contract to which the officer is a party. Any such resignation shall take effect at the date of the receipt of such notice or at any later time specified therein, and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
Section 7.6 Vacancies in Offices
A vacancy in any office because of death, resignation, removal, disqualification, or any other cause shall be filled in the manner prescribed in these Bylaws for regular appointment to that office.
Section 7.7 Responsibilities of Officers
(a) President. The President shall be the general manager and chief executive officer of the Corporation and shall, subject to the control of the Board, have general supervision, direction, and control of the activities and officers of the Corporation. The President shall preside at all meetings of the Board. The President shall have the general powers and duties of management usually vested in the office of president of a nonprofit corporation, including the power to execute contracts on behalf of the Corporation, and shall have such other powers and duties as may be prescribed by the Board or these Bylaws.
(b) Secretary. The Secretary shall keep or cause to be kept, at the principal office or such other place as the Board may direct, a book of minutes of all meetings of the Board and its committees, with the time and place of holding, whether regular or special, and if special, how authorized, the notice given, and the names of those present. The Secretary shall give, or cause to be given, notice of all meetings of the Board and its committees required by these Bylaws to be given, shall keep the corporate seal, if any, in safe custody, and shall have such other powers and perform such other duties as may be prescribed by the Board or these Bylaws.
(c) Treasurer/Chief Financial Officer. The Treasurer/Chief Financial Officer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the Corporation. The Treasurer/CFO shall send or cause to be sent to the directors such financial statements and reports as are required to be sent by law, by these Bylaws, or by the Board. The Treasurer/CFO shall deposit all moneys and other valuables in the name and to the credit of the Corporation with such depositories as may be designated by the Board, shall disburse the funds of the Corporation as ordered by the Board, shall render to the President and directors, whenever they request it, an account of all transactions as Treasurer/CFO and of the financial condition of the Corporation, and shall have such other powers and perform such other duties as may be prescribed by the Board or these Bylaws.
(d) Executive Director. When the Board has elected or appointed an Executive Director, the Executive Director shall be the chief operating officer of the Corporation, subject to the control of the Board and the President. The Executive Director shall have day-to-day responsibility for managing the operations, staff, and programs of the Corporation; shall implement the policies and programs adopted by the Board; shall prepare or oversee the preparation of the annual budget and financial reports; and shall have such other powers and perform such other duties as may be prescribed by the Board or these Bylaws. The offices of President and Executive Director may be held concurrently by the same individual.
Section 7.8 Compensation of Officers
Officers shall serve without compensation unless the Board, by resolution, authorizes compensation after reviewing and approving a written compensation policy consistent with California law. Any decision to compensate an officer shall be made by the Board in compliance with Section 12.2 of these Bylaws and California Corporations Code Section 5227.
Section 7.9 Executive Director
The Board may engage an Executive Director to manage the day-to-day operations of the Corporation. The Executive Director shall serve at the pleasure of the Board. Where the offices of President and Executive Director are held by the same person, that person shall possess and may exercise all powers and duties of both offices. The Executive Director position may be compensated or uncompensated as determined by the Board consistent with these Bylaws.
ARTICLE VIII — CONTRACTS, CHECKS, AND DEPOSITS
Section 8.1 Contracts
The Board, except as otherwise provided in these Bylaws, may authorize any officer or officers, agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the Corporation, and such authority may be general or confined to specific instances. Unless so authorized or ratified by the Board or within the agency power of an officer, no officer, agent, or employee shall have any power or authority to bind the Corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount.
Section 8.2 Checks and Drafts
All checks, drafts, or other orders for payment of money, notes, or other evidences of indebtedness, issued in the name of or payable to the Corporation, shall be signed or endorsed by such person or persons and in such manner as, from time to time, shall be determined by resolution of the Board.
Section 8.3 Deposits
All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation in such banks, trust companies, or other depositories as the Board may select.
Section 8.4 Loans
No loans shall be contracted on behalf of the Corporation, and no evidence of indebtedness shall be issued in its name, unless authorized by the Board. Such authority may be general or confined to specific instances.
Section 8.5 Gifts
The Board may accept on behalf of the Corporation any contribution, gift, bequest, or devise for the charitable purposes of the Corporation.
ARTICLE IX — RECORDS AND REPORTS
Section 9.1 Maintenance of Records
The Corporation shall keep at its principal office, or at such other place as the Board may direct: (a) a copy of the Articles of Incorporation and all amendments thereto; (b) a copy of these Bylaws and all amendments thereto; (c) minutes of all meetings of the Board and any committees thereof; (d) adequate and correct books and records of account; (e) a record of the names and addresses of all directors and officers; and (f) copies of all annual reports and financial statements of the Corporation.
Section 9.2 Inspection by Directors
Every director shall have the absolute right at any reasonable time to inspect and copy all books, records, and documents of every kind, and to inspect the physical properties of the Corporation, for a purpose reasonably related to the director's interest as a director. Inspection may be made in person or by agent or attorney, and the right of inspection includes the right to copy and make extracts.
Section 9.3 Annual Report
The Board shall prepare, or cause to be prepared, within one hundred twenty (120) days after the close of each fiscal year, an annual report containing the following:
(a) the assets and liabilities, including the trust funds, of the Corporation as of the end of the fiscal year;
(b) the principal changes in assets and liabilities, including trust funds, during the fiscal year; (c) the revenue or receipts of the Corporation, both unrestricted and restricted to particular purposes, for the fiscal year; (d) the expenses or disbursements of the Corporation, for both general and restricted purposes, during the fiscal year; and (e) any information required by California Corporations Code Section 6322 (relating to transactions with interested persons and indemnification payments). The annual report shall be accompanied by any report from independent accountants, or, if there is no such report, by the certificate of an authorized officer of the Corporation that such statements were prepared without audit from the Corporation's books and records. The requirement to prepare and furnish an annual report may also be satisfied by furnishing a copy of the Corporation's annual federal information return (Form 990, 990-EZ, or 990-N) and California Form RRF-1, together with such additional information as is necessary to satisfy the requirements of California Corporations Code Sections 6321 and 6322, to each director within the period specified above.
Section 9.4 Annual Statement of Certain Transactions and Indemnifications
As part of the annual report, or as a separate document if no annual report is issued, the Corporation shall provide to each director a statement of any transaction or indemnification of the following kind, within one hundred twenty (120) days after the close of the Corporation's fiscal year:
(a) Any transaction during the prior fiscal year in which the Corporation was a party and in which any director or officer had a direct or indirect material financial interest, excluding (i) compensation of directors and officers approved by the Board, and (ii) transactions not exceeding $50,000 that were approved in accordance with Section 12.2.
(b) Any indemnification or advance of expenses made pursuant to these Bylaws or California Corporations Code Section 5238 during the prior fiscal year in excess of $10,000.
Section 9.5 Periodic Financial Reports to the Board
The Treasurer/CFO shall present to the Board, at each regular meeting of the Board, a written financial report showing receipts and disbursements for the period since the last report, the current balances of all accounts, and such other financial information as the Board may request. At least annually, the Board shall review a complete financial statement of the Corporation for the preceding fiscal year.
ARTICLE X — FISCAL YEAR
The fiscal year of the Corporation shall begin on January 1 and end on December 31 of each year, unless otherwise fixed by resolution of the Board.
ARTICLE XI — INDEMNIFICATION AND INSURANCE
Section 11.1 Indemnification of Directors and Officers
The Corporation shall, to the maximum extent permitted by the California Nonprofit Public Benefit Corporation Law, indemnify each of its directors and officers against expenses (including attorneys' fees), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding arising by reason of the fact that such person is or was an agent of the Corporation, provided that such person acted in good faith and in a manner such person reasonably believed to be in the best interests of the Corporation, and, in the case of a criminal proceeding, had no reasonable cause to believe the conduct of such person was unlawful. The termination of any proceeding by judgment, order, settlement, 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 which the person reasonably believed to be in the best interests of the Corporation, or that the person had reasonable cause to believe that the person's conduct was unlawful.
Section 11.2 Advance of Expenses
Expenses incurred in defending any proceeding may be advanced by the Corporation prior to the final disposition of such proceeding upon receipt of an undertaking by or on behalf of the director or officer to repay such amount if it shall ultimately be determined that the director or officer is not entitled to be indemnified as authorized in Section 11.1.
Section 11.3 Insurance
The Corporation shall have the power to purchase and maintain insurance on behalf of any agent of the Corporation against any liability asserted against or incurred by the agent in such capacity or arising out of the agent's status as such, whether or not the Corporation would have the power to indemnify the agent against such liability under the provisions of California Corporations Code
Section 5238.
ARTICLE XII — CONFLICTS OF INTEREST AND GOVERNANCE POLICIES
Section 12.1 Conflicts of Interest Policy
The Board shall adopt and maintain a written Conflicts of Interest Policy that complies with the requirements of California law and, to the extent applicable, the Internal Revenue Service Form 990 governance standards. Each director, officer, and committee member shall annually review and acknowledge in writing his or her obligations under the policy. The current Conflicts of Interest Policy is attached as Appendix A to these Bylaws and is incorporated herein by this reference.
Section 12.2 Interested Party Transactions
The Corporation shall not approve any contract, transaction, or proposed transaction involving the Corporation in which any director, officer, or key employee of the Corporation has a personal financial interest (direct or indirect), unless: (a) the material facts as to the person's relationship or interest, and as to the contract or transaction, are disclosed or known to the Board or committee with authority to authorize the transaction; (b) the interested person is given the opportunity to present information to the Board or committee regarding the transaction; (c) the interested person abstains from voting on authorization of the transaction; (d) the Board or committee, in good faith and by a majority vote of disinterested directors, determines that the transaction is in the Corporation's best interest and is fair and reasonable to the Corporation; and (e) the determination and the basis therefor are recorded in the minutes. Whenever reasonably possible, the Board shall obtain and consider independent comparable data regarding the transaction before authorizing it.
Section 12.3 Document Retention and Destruction Policy
The Board shall adopt and maintain a written Document Retention and Destruction Policy. The policy shall establish standards for the creation, maintenance, and authorized destruction of corporate documents and records, shall provide for the suspension of destruction in the event of pending or anticipated litigation or government inquiry, and shall otherwise comply with applicable law including federal and California record retention requirements.
Section 12.4 Whistleblower Policy
The Board shall adopt and maintain a written Whistleblower Policy that enables directors, officers, employees, and volunteers to raise concerns about the Corporation's financial and governance practices, including suspected fraud, illegal activity, or significant violations of the Corporation's policies, without fear of retaliation. The policy shall designate a senior officer or committee to receive and investigate complaints and shall provide for the confidential and anonymous submission of concerns.
ARTICLE XIII — AMENDMENTS
Section 13.1 Amendment of Bylaws
These Bylaws may be adopted, amended, or repealed by approval of the Board; provided, however, that the Board shall not adopt, amend, or repeal any Bylaw that fixes or changes (a) the authorized number of directors, (b) the qualifications of directors, (c) voting provisions, or (d) any provision requiring action by a specified percentage of the full Board or a specified vote of the disinterested directors, without the affirmative vote of a majority of the directors then in office. A copy of any amendment to these Bylaws shall be filed with the minutes of the meeting at which the amendment was adopted.
Section 13.2 Amendment of Articles
Amendment of the Articles of Incorporation requires approval of the Board in accordance with applicable law. The Board acknowledges that certain amendments — including any amendment to the Corporation's charitable purpose clause or dissolution provisions — may require notice to or approval by the California Attorney General pursuant to California Corporations Code Section 5817. The President and Secretary are authorized to provide any such required notice and to execute any documents necessary to effectuate approved amendments.
ARTICLE XIV — CONSTRUCTION AND DEFINITIONS
Unless the context requires otherwise, the general provisions, rules of construction, and definitions contained in the California Nonprofit Corporation Law shall govern the construction of these Bylaws. Without limiting the generality of the preceding sentence: (a) the singular number includes the plural, and the plural the singular; (b) the masculine gender includes the feminine and neuter; (c) "shall" is mandatory and "may" is permissive; (d) "includes" and "including" are not limiting; (e) references to specific statutory sections shall be deemed to include any successor provisions; and (f) references to a "director" or "officer" include any duly acting alternate or temporary holder of such office.
These Bylaws are intended to be consistent with all applicable state and federal laws governing nonprofit public benefit corporations. If any provision of these Bylaws is found to be invalid or unenforceable for any reason, such provision shall be severed, and the remainder of these Bylaws shall remain in full force and effect. The captions and section headings of these Bylaws are included for convenience only and shall not affect the interpretation of any provision hereof.
CERTIFICATE OF SECRETARY
I, the undersigned, certify that I am the duly elected and acting Secretary of Joey's Toy Drive, a California Nonprofit Public Benefit Corporation, and that the foregoing Bylaws, including Appendix A and Exhibit 1 thereto, the Annual Conflict of Interest Disclosure Statement, constitute the Bylaws of this Corporation as duly adopted by the Board of Directors on the date set forth below.
________________________________________________ Brooke Childs, Secretary
Joey's Toy Drive
APPENDIX A
CONFLICT OF INTEREST POLICY
Joey's Toy Drive
ARTICLE I — PURPOSE
The purpose of this Conflict of Interest Policy (this "Policy") is to protect the interests of Joey's Toy Drive (the "Corporation") when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director of the Corporation 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 conflicts of interest applicable to nonprofit and charitable organizations.
ARTICLE II — DEFINITIONS
Section 1. Interested Person
Any director, principal officer, or member of a committee with governing board-delegated powers who has a direct or indirect financial interest, as defined below, is an "Interested Person."
Section 2. Financial Interest
A person has a "Financial Interest" if the person has, directly or indirectly, through business, investment, or family: (a) an ownership or investment interest in any entity with which the Corporation has a transaction or arrangement; (b) a compensation arrangement with the Corporation or with any entity or individual with which the Corporation has a transaction or arrangement; or (c) a potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Corporation is negotiating a transaction or arrangement. Compensation includes 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 Article III, Section 2, a person who has a Financial Interest may have a conflict of interest only if the appropriate governing board or committee decides that a conflict of interest exists
ARTICLE III — PROCEDURES
Section 1. 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 directors and members of committees with governing board-delegated powers who are considering the proposed transaction or arrangement.
Section 2. 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, the Interested Person shall leave the governing board or committee meeting while the determination of a conflict of interest is discussed and voted upon. The remaining board or committee members shall decide if a conflict of interest exists.
Section 3. Procedures for Addressing the Conflict of Interest
(a) An Interested Person may make a presentation at the governing board or committee meeting, but after the presentation, the Interested Person shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest. (b) The chairperson of the governing board or committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
(c) After exercising due diligence, the governing board or committee shall determine whether the Corporation 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. (d) If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the governing board or committee shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the Corporation'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.
Section 4. Violations of the Conflicts of Interest Policy
(a) If the governing board or committee has reasonable cause to believe a member has failed to disclose actual or possible conflicts of interest, it shall inform the member of the basis for such belief and afford the member an opportunity to explain the alleged failure to disclose.
(b) If, after hearing the member's response and after making further investigation as warranted by the circumstances, the governing board or committee determines the member has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.
ARTICLE IV — RECORDS OF PROCEEDINGS
The minutes of the governing board and all committees with governing board-delegated powers 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 governing board's or committee'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.
ARTICLE V — COMPENSATION
(a) A voting member of the governing board who receives compensation, directly or indirectly, from the Corporation for services is precluded from voting on matters pertaining to that member's compensation. (b) A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Corporation for services is precluded from voting on matters pertaining to that member's compensation. (c) Any voting member of the governing board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Corporation, either individually or collectively, may provide information to any committee regarding compensation.
ARTICLE VI — ANNUAL STATEMENTS
Each director, principal officer, and member of a committee with governing board-delegated powers shall annually sign a statement that affirms the signatory: (a) has received a copy of the Conflict of Interest Policy;
(b) has read and understands the Policy; (c) has agreed to comply with the Policy; and
(d) understands the Corporation is charitable and, in order to maintain its federal tax exemption, it must engage primarily in activities that accomplish one or more of its tax-exempt purposes.
ARTICLE VII — PERIODIC REVIEWS
To ensure the Corporation 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; and (b) whether partnerships, joint ventures, and arrangements with management organizations conform to the Corporation'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.
ARTICLE VIII — USE OF OUTSIDE EXPERTS
When conducting the periodic reviews provided for in Article VII, the Corporation 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 that periodic reviews are conducted.
EXHIBIT 1 TO APPENDIX A
ANNUAL CONFLICT OF INTEREST DISCLOSURE STATEMENT Joey's Toy Drive
This Annual Conflict of Interest Disclosure Statement is to be completed and signed by each director, principal officer, and member of a committee with governing board-delegated powers of Joey's Toy Drive (the "Corporation") on an annual basis, and at any time a new conflict of interest arises or a previously disclosed conflict changes materially.
Part I — Identification
Part II — Disclosure of Financial Interests
Please identify any Financial Interest (as defined in the Corporation's Conflict of Interest Policy) that you, or a member of your immediate family, have in any entity that has a transaction or arrangement with the Corporation, or with which the Corporation is considering a transaction or arrangement.
Name of Entity: _______________________________________________________________ Nature of Interest: _____________________________________________________________
Description of Transaction or Arrangement: ______________________________________________________________________________ ______________________________________________________________________________
Part III — Certification
I certify that:
1. I have received a copy of the Conflict of Interest Policy of the Corporation; 2. I have read and understand the Policy;
3. I agree to comply with the Policy; and 4. I understand that the Corporation is charitable and, in order to maintain its federal tax exemption, it must engage primarily in activities that accomplish one or more of its tax-exempt purposes.
5. To the best of my knowledge, I have disclosed above all Financial Interests that I am aware of that are required to be disclosed under the Policy. I understand that failure to disclose a Financial Interest may result in disciplinary action up to and including removal from my position with the Corporation.
Brooke Childs, Secretary, Joey's Toy Drive, 186 Barnard Ave, San Jose, CA 95125