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HomeMy WebLinkAboutCFCLT By-LawsBY-LAWS OF CAPE FEAR HOUSING LAND TRUST, INC. Approved by the Board of Directors February 13, 2009 ARTICLE I. NAME The name of the organization shall be the CAPE FEAR HOUSING LAND TRUST, INC. hereinafter referred to as the “Corporation”. ARTICLE II. OFFICES The principal office of the Corporation shall be located at: 20 North 4th Street, Suite 200, Wilmington, North Carolina 28401 The Corporation may have such other offices, either within or outside of the State of North Carolina, as the Board of Directors may determine from time to time. The Corporation shall also maintain a registered office in the State of North Carolina as required by law, which may be, but need not be, identical to the principal office. ARTICLE III. PURPOSES. The purposes of the Corporation shall be: (a) To provide opportunities for households earning between 25-120% of the area median income by household size (the “Eligible Households”) to secure housing that is decent and affordable, and is controlled by residents and the community on a long-term basis. The primary focus of the Corporation's activities and the majority of the Corporation's resources will serve the Eligible Households. (b) To preserve the quality, affordability, and economic diversity of housing for present and future residents of Southeastern North Carolina and primarily in New Hanover, Brunswick and Pender Counties. (c) To partner with town governments, city governments, county government, non-profit corporations, for-profit housing developers and major employers in Southeastern North Carolina to further the Corporation’s purposes. (d) To assist local government staff and elected officials in their efforts to design and implement policies and programs that address housing needs in southeastern North Carolina. (e) To acquire developed or undeveloped land, to hold land in perpetuity, to hold ground leases, and to arrange for the purchase, sale, repurchase, and development of housing and other structural improvements as appropriate. Bylaws Of Cape Fear Housing Land Trust, Inc. 1 (f) To produce and to encourage production of homes that are safe, durable, comfortable, cost effective, energy efficient and sustainable, and to assist residents of housing located on land owned by the Corporation in maintaining and improving the quality and security of their housing and the safety and well-being of their community. (g) To educate and advocate in the local community to increase private sector participation in efforts to provide adequate housing for the Served Community (h) To conduct education and counseling programs that will prepare interested families and individuals for the responsibilities of home ownership, and create a pool of ready buyers for homes the Corporation builds or acquires. (i) To protect the natural environment and to promote the ecologically sound use of land and natural resources and the long-term health and safety of the community. ARTICLE IV. POWERS. The general powers of the Corporation are: (a) To accept, receive, hold, sell, re-invest and dispose of gifts, donations, devises and bequests of both real and personal property. (b) To purchase, acquire, own, hold, sell, use, mortgage, transfer, pledge and deed in trust personal or real property; to supervise property of others; to borrow money; to issue notes, and other obligations of this Corporation from time to time for any of the projects or purposes of this Corporation. (c) To buy, lease, rent or otherwise acquire, hold or use, own, enjoy, sell, exchange, lease as lessor, mortgage, deed in trust, pledge, encumber, transfer on trust or otherwise dispose of any and all kinds of property, whether real, personal or mixed, and to receive property by devise or bequest. (d) To borrow money and to contract debts, to issue notes and other evidences of indebtedness, and to secure them by any or all of the property of this Corporation or to issue them unsecured. (e) To enter into, make, perform and carry out contracts of every kind for any lawful purpose and without limit on amount with any persons, firm or corporation. (f) To have and to exercise all the powers conferred by the State of North Carolina Nonprofit Corporation Act, as that law is now in effect or may at any time hereafter be amended. ARTICLE V. LIMITATIONS ON POWERS Section 5.01 Private Benefit. No part of the net earnings of the Corporation shall ever inure to the benefit of, or be distributable to, its Officers, Trustees, Directors or any person except that the Corporation Bylaws Of Cape Fear Housing Land Trust, Inc. 2 shall be authorized and empowered to pay reasonable compensation for services rendered, and to make payments in the furtherance of, the purposes of the Corporation. Section 5.02 Charitable Purposes. This Corporation is organized and shall be operated exclusively for public benefit, charitable and educational purposes including, for such purposes, the making of distributions to organizations that qualify as exempt organizations under Section 501(c)(3) of the Internal Revenue Code of 1986 (or the corresponding provision of any future United States Internal Revenue Law). Notwithstanding any other provision of these Bylaws, the Corporation shall not carry on any other 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 of 1986 (or the corresponding provision of any future United States Internal Revenue Law) or (b) by a corporation, contributions to which are deductible under Section 170(c)(2) of the Internal Revenue Code of 1986 (or the corresponding provision of any future United States Internal Revenue Law). ARTICLE VI. MEMBERSHIP The Corporation shall not have members. However, at least once per annum, the Board of Directors shall vote either to remain a non-member organization or to alter the structure to permit members. Any vote to alter the structure to a membership organization must be by two-thirds of the Board. ARTICLE VII. BOARD OF DIRECTORS Section 7.01 Management of the Corporation. The business and affairs of the Corporation, including amendment of the Articles of Incorporation and By-Laws, merger, consolidation and dissolution, shall be managed by its Board of Directors and each of them shall have no authority to bind the Corporation except when acting as a Board. Section 7.02 Number and Term of Directors. The number of Directors consist of such number, not less than four (4) nor more than twenty (20), as shall be determined from time to time by the Board of Directors. The Directors shall be divided into three classes, as nearly equal in number as may be, to serve in the first instance for terms of one, two and three years, respectively, and thereafter the successors in each class of Directors shall be elected to serve for terms of three years. If the authorized number of Directors is changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of Directors in each class as nearly equal as possible. In no case will a decrease in the number of Directors shorten the term of any incumbent Director. A Director shall hold office until the annual meeting of the Board of Directors held in the year in which his or her successor shall be elected, subject, however, to prior death, resignation, retirement, disqualification or Bylaws Of Cape Fear Housing Land Trust, Inc. 3 removal from office. No Director may serve more than two (2) successive three (3) year terms; provided, a Director appointed to fill an unexpired term may thereafter serve two (2) additional three (3) year terms if so elected. Section 7.03 Election. Directors shall be elected at the annual meeting of the members. If the election of Directors is not held at such meeting, such election shall be held as soon thereafter as is convenient. Section 7.04 Vacancies. Any vacancy occurring in the Board of Directors, from whatever cause arising, may be filled by a majority vote of the remaining members of the Board of Directors at the next regular or special meeting thereof. The term of a Director filling a vacancy expires at the end of the unexpired term that such Director is filling. In the event that all Directorships become vacant, the President of the Corporation shall appoint new Directors. Section 7.05 New Directorships. New Directorships may be created and filled at any meeting of the Board of Directors. Section 7.06 Removal Any Director elected by the Board of Directors may be removed by a two-thirds vote of the Board of Directors whenever in their judgment the best interests of the Corporation would be served thereby, at a meeting called for the purpose of removing the Director. Any Director elected by the Board of Directors may be removed by a two-thirds vote of the Board of Directors whenever in its judgment the best interests of the Corporation would be served thereby. Notwithstanding any other provision hereof, the Board of Directors may remove any Director who fails to attend two (2) consecutive Board meetings without satisfactory excuse approved by the President, may be removed by a majority vote of the Board. Said failure to attend must be reported to the Board by the Secretary of the Corporation, or such other person as is designated by the Board of Directors. Section 7.07 Chair of the Board The Board of Directors shall appoint from among its members a Chair of the Board, who shall, when present, preside at meetings of the Board of Directors and shall have such other duties and authority as may be prescribed by the Board of Directors from time to time. Section 7.08 Regular Meetings An annual meeting of the Board of Directors for the purpose of electing officers and transacting other business shall be held at the first meeting following the beginning of the Fiscal Year. The Board of Directors shall meet at least three (3) times a year in addition to the annual meeting at a time and place determined by the President and communicated to all board members, for the purpose of transacting such business as properly may come before the Board. Bylaws Of Cape Fear Housing Land Trust, Inc. 4 Section 7.09 Special Meetings Special meetings of the Board of Directors may be called by the President of the Corporation, the Chair of the Board or by a majority of the members of the Board of Directors. Such meetings shall be held upon such notice as required by Section 7.10. Section 7.10 Notice of Special Meetings and Waiver of Notice (a) The person or persons calling a special meeting of the Board of Directors shall give notice thereof, specifying the purpose for which the meeting is called, by any usual means of communication. If such notice is given to a Director in writing by mail, it shall be mailed, correctly addressed to such Director with the postage prepaid, no later than five (5) days prior to the date of the meeting. If such notice is given to a Director in writing otherwise than by mail, it shall be given so that it is received by such Director no later than two (2) days prior to the meeting. If such notice is given orally to a Director, it shall be communicated orally to such Director no later than two (2) days prior to the meeting. Delivery or completion of transmission of written notice to the address of a Director shall be deemed received by such Director, and any such written notice given to a Director by mail that is not timely mailed shall nevertheless be valid and effective if so received by such Director no later than two (2) days prior to the date of the meeting. (b) Any Director may waive notice of any special meeting held without proper call or notice, either before or after the meeting is held. A Director’s attendance at or participation in a meeting shall constitute a waiver by such Director of notice of such meeting, unless the Director at the beginning of the meeting (or promptly upon his or her arrival) objects to holding the meeting or to the transaction of business at the meeting and does not thereafter vote for or assent to action taken at the meeting. Section 7.11 Quorum One-third of the Directors acting and qualified shall be necessary to constitute a quorum for the transaction of any business, except the filling of vacancies, and the act of a majority of the Directors voting on any matter at the meeting at which a quorum is present shall be the act of the Board of Directors, unless the act of a greater number is required by law or the Articles of Incorporation of the Corporation. Section 7.12 Meetings By Telephone or Electronic Means Unless otherwise restricted by the Articles of Incorporation, these Bylaws or by statute, members of the Board or any committee designated by the Board or the President may participate in a meeting of the Board or of its committees by means of conference telephone, electronic means, including internet transmission, or similar communications equipment whereby all persons participating in the meeting can hear or otherwise communicate with each other, and participation in a meeting in such a manner shall constitute presence in a person at such meeting. Section 7.13 Actions By Unanimous Written Consent Any action required or permitted to be taken at any meeting of the Board of Directors may be taken without a meeting of the Board of Directors if, before or after such action, a written consent thereto is signed by all members of the Board to evidence the affirmative Bylaws Of Cape Fear Housing Land Trust, Inc. 5 vote of the number of Directors required to approve such action, and such consent is filed with the minutes of the proceedings of the Board. Section 7.14 Proxy Voting. Voting by proxy by Directors shall not be permitted. Section 7.15 Compensation No Director, other than the Executive Director, shall receive any compensation for his or her service in such capacity. ARTICLE VIII. SPECIAL VOTING. The following matters shall require an affirmative vote of two-thirds (2/3) of the entire Board of Directors at any Regular or Special Board Meeting provided that written notice of such meeting has set forth the proposed change or action with appropriate explanations thereof: (a) Adoption or revocation of a plan of merger; (b) Consolidation; (c) Voluntary dissolution; (d) Bankruptcy or reorganization; (e) The sale, lease, or exchange of all or substantially all of the property and assets of the Corporation; (f) Sale of the Corporation’s land; (g) Alteration of the Corporation’s Resale Formula; (h) Amendments to the Corporation’s Articles of Incorporation; (i) Amendments to the Organization’s Bylaws; (j) Removal of a Director of the Corporation by the Board ; and (k) Removal of an Officer of the Corporation. ARTICLE IX. COMMITTEES Section 9.01 Executive Committee There shall be an Executive Committee which shall consist of the elective officers of the Board of Directors and the Chairman of any standing committee of the Board of Directors. All the members of the Board of Directors may attend meetings of the Executive Committee without power of vote. Action taken at any such meeting will be reported at the next scheduled meeting of the full Board of Directors. The Executive Committee shall have Bylaws Of Cape Fear Housing Land Trust, Inc. 6 and may exercise when the Board of Directors is not in session all the powers of the Board that may be lawfully delegated. However, neither the Executive Committee, nor any other Committee of the Board, may: (1) authorize distributions, (2) recommend to members or approve dissolution, merger or the sale, pledge, or transfer of all or substantially all of the corporation’s assets, (3) elect, appoint or remove Directors, or fill vacancies on the Board of Directors or any of its Committees, or (4) adopt, amend, or repeal the Articles of Incorporation or Bylaws. (per §55A-8-25(e)). The Executive Committee of the Board of Directors may transact business at a meeting by telephone conference call, by telephone ballot, telegram ballot or facsimile ballot. A quorum of the Executive Committee shall be three members. Section 9.02 Nominating Committee There shall be a standing nominating committee appointed by the Board of Directors. Section 9.03 Other Committees The Board of Directors, at its discretion, may establish such additional standing or special committees as may be deemed appropriate to act in an advisory capacity or to assist in the governance of the Corporation, with responsibilities and powers appropriate to the nature of the several committees and as provided by the Board of Directors in the resolution of appointment or in subsequent resolutions and directives. At a committee meeting, a quorum shall be a majority of the members of the committee. Each committee meeting shall have an agenda and shall submit minutes of its meeting to the Board of Directors. Section 9.04 Dissolution The Board of Directors, at its discretion, may dissolve any existing standing or special committee when deemed inactive or ineffective in its specified advisory capacity or assistance in the governance of the Corporation. ARTICLE X.: OFFICERS Section 10.01 Officers’ Titles The Officers of the Corporation shall be a President, a Secretary, one or more Assistant Secretaries, a Treasurer, one or more Vice-Presidents and such other Officers as may be elected in accordance with the provisions of this Article X. The Board of Directors may elect or appoint such other Officers, including one or more assistant secretaries and one or more assistant treasurers, as it shall deem desirable, such Officers to have the authority and perform the duties prescribed from time to time by the Board of Directors. Any two or more offices may be held by the same person except the offices of President and Secretary. All Officers other than Assistant Secretaries and Assistant Treasurers shall be Directors. Bylaws Of Cape Fear Housing Land Trust, Inc. 7 Section 10.02 Election and Term of Office All Officers shall be elected at the annual meeting of the Board of Directors and each Officer, whenever elected, shall hold office until the next annual meeting of the Board of Directors or until his or her successor shall have been elected and qualified. Section 10.03 Removal The Board of Directors, by a majority vote of said Board, may remove any Officer, with or without cause. Vacancies in such offices, however occurring, may be filled by a majority vote of the Board at any meeting of the Board. Section 10.04 Vacancies A vacancy in any office may be filled by the Board of Directors for the unexpired portion of the term. Section 10.05 Powers of Officers (a) The President. The President shall preside at all meetings of the Board of Directors. He or she shall execute in the name of the Corporation all deeds, mortgages, contracts and other documents authorized by the Board of Directors. He or she shall be an ex- officio member of all standing committees and shall have the general powers and duties of supervision and management- usually vested in the office of President of the Corporation. He or she shall be designated attorney-in-fact for the Corporation by virtue of his office. He or she shall have the authority to appoint and approve any assistants that would be necessary to properly carry on the work of the Corporation. (b) The Vice-President. The Vice-President shall have such powers and perform such duties as may be assigned to him or her by the President or Board of Directors. The Vice-President shall perform all duties incumbent upon the President during the absence or disability of the President. (c) The Treasurer. The Treasurer shall perform all of the duties customary to that office, including the duty of supervising the keeping of the records of the receipts and disbursements of the Corporation. He or she shall submit to the Board of Directors at the annual meeting and at such other times as the Board may require full statements showing in detail the financial condition and affairs of the Corporation. He or she shall give such bond, if any, for the faithful performance of his duties as the Board may require. In the absence or inability of the Treasurer, the Assistant Treasurer, if any, shall perform only such duties as are herein or specifically assigned to him or her, in writing, by the Board of Directors or by the President of the Corporation. (d) The Secretary. The Secretary shall be the custodian of the books, papers and the records of the Corporation. He or she shall keep the minutes of the meetings of the Board of Directors and enter the same in the Book of Minutes of the Corporation. He or she shall perform all of the other duties usual to the office of secretary of a Corporation. Bylaws Of Cape Fear Housing Land Trust, Inc. 8 (e) The Assistant Secretary. The Assistant Secretary shall have such powers and perform such duties as may be assigned to him or her by the Secretary. The Assistant Secretary shall perform all duties incumbent upon the Secretary during the absence or disability of the Secretary. ARTICLE XI. COMPENSATION FOR DIRECTORS, OFFICERS, AND COMMITTEE MEMBERS Directors, Officers, and Committee Members shall serve without compensation with the exception that reasonable expenses incurred in furtherance of the Corporation’s business may be reimbursed for such expenses as may be fixed or determined by a resolution of the Board of Directors. In addition, Directors, Officers, or Committee Members serving the organization in another capacity, such as staff, may receive compensation in that capacity. ARTICLE XII. STAFF Section 12.01 Authority to Hire Staff. The Board of Directors shall hire an Executive Director and other such personnel as it shall deem appropriate. Section 12.02 Duties of the Executive Director. The Executive Director of the Corporation shall manage the Corporation in administering the conduct of its business. Where appropriate, the Board of Directors shall place the Executive Director under a contract of employment. The Executive Director shall be responsible to and governed by the Board of Directors. Specifically the Executive Director shall: (a) Report to and advise the Board on all significant matters of the Corporation’s business and see that all orders and resolutions of the Board are carried into effect. (b) Be empowered to act, speak for, or otherwise represent the Corporation between meetings of the Board within the boundaries of the policies and purposes established by the Board and as set forth in the Articles of Incorporation and Bylaws. (c) Be responsible for the hiring and firing of all other personnel; for keeping the Board informed at all times of staff performance as related to program objectives; and for implementing any personnel policies adopted by the Board. (d) If authorized by the Board of Directors, receive, deposit, disburse, and account for funds of the Corporation in accordance with the procedures adopted by the Board of Directors. (e) If authorized by the Board of Directors, execute in the Corporation’s name specified bonds, contracts, deeds, leases, and other written instruments to be executed by the Corporation, and to negotiate other specified material business transactions of the Corporation. Bylaws Of Cape Fear Housing Land Trust, Inc. 9 ARTICLE XIII. IMMUNITY To the fullest extent permitted by North Carolina law and the Articles, a Director shall be immune from personal and civil liability for monetary damages. ARTICLE XIV. INDEMNIFICATION Section 14.01 Indemnification Generally. The Corporation shall indemnify any person who is or was a Director, Officer, employee or agent of the Corporation, or is or was serving as a director, officer, employee or agent of another Corporation, partnership or other enterprise at the request of the Corporation, against expenses (including attorneys’ fees), judgments, fines, penalties and amounts paid in settlement reasonably incurred by such person, to the fullest extent now or hereafter permitted by law, in connection with or resulting from any claim, action, suit or proceeding (whether actual or threatened, civil, criminal, administrative or investigative, or in connection with an appeal relating thereto), in which such person may be involved as a party or otherwise by reason of being or having been a Director, Officer, employee or agent for the Corporation or of such other organization; provided such person acted in good faith and in a manner that he or she reasonably believed to be in, or not opposed to, the best interests of the Corporation and, with respect to any criminal action or proceeding, in a manner which he or she had no reasonable cause to believe was unlawful. The termination of any claim, action, suit or proceeding by judgment, order, settlement (whether with or without court approval), 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 he or she reasonably believes to be in, or not opposed to, the best interests of the Corporation, and with respect to any criminal action, suit or proceeding, in a manner which he or she had no reasonable cause to believe was unlawful. Section 14.02 Mandatory Indemnification Any Director, Officer, employee or agent of the Corporation who has been successful as a party on the merits or otherwise in his defense of any claim, action, suit or proceedings referred to in the first sentence of Section 14.01 of this Article XIV shall be indemnified as of right against expenses (including attorneys’ fees) reasonably incurred by him or her in connection therewith (except to the extent covered by insurance). Section 14.03 Permissive Indemnification Except as provided in Section 14.02, any indemnification under Section 14.01 of this Article XIV shall be made by the Corporation only upon a determination that indemnification of the particular Director, Officer, employee or agent is proper in the circumstances because such person has met the applicable standards of conduct set forth in Section 14.01. Such determination shall be made (a) by the Board of Directors of the Corporation, by a majority vote of a quorum consisting of members of the Board of Directors who were not parties to such claim, action, suit or proceeding or (b) if such a quorum is not obtainable or if so directed by a majority vote of a quorum consisting of members of the Board of Directors who were not parties to such claim, action, suit or Bylaws Of Cape Fear Housing Land Trust, Inc. 10 proceeding by independent legal counsel (who may be regular counsel of the Corporation) in a written opinion. Section 14.04 Not Exclusive of Other Rights The indemnification provided by this Article XII shall not be deemed exclusive of any other rights to which a Director, Officer, employee or agent may be entitled under any Bylaw, resolution, agreement, vote of the members or otherwise and shall continue as to a person who has ceased to be a Director, Officer, employee or agent of the Corporation, and shall inure to the benefit of the heirs, executors and administrators of any such person. The indemnification provided by this Article XIV shall be applicable to claims, actions, suits or proceedings made or commenced after the adoption hereof, arising from acts or omissions to act whether before or after the adoption hereof. Section 14.05 Insurance The Corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a Director, Officer, partner, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against such person and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the Corporation would have the power to indemnify him or her against such liability under the provisions of this Article XIV, together with expenses actually and reasonably incurred by him or her in connection with his defense thereof; provided that when and to the extent that the Corporation has purchased and maintained such insurance, it shall have no duty under this Article XIV to indemnify any such person to the extent such liability is covered by such insurance. ARTICLE XV. STEWARDSHIP OF LAND, LIMITATIONS ON RESALE, AND RESALE FORMULA Section 15.01 Principles of Land Use. The Board of Directors shall oversee the use of land owned by the Corporation and shall convey the right to use such land so as to facilitate access by low- and moderate-income households to land, affordable housing, and other community needs in accordance with the Articles of Incorporation and these By-laws. Section 15.02 Sale of Land. The philosophy and purposes of the Corporation are focused on acquiring and retaining the ownership of land. Accordingly, land shall not be sold except in circumstances where the Board has resolved that the sale of land is will advance the purpose of the Corporation. In such circumstances, land may be sold only with an affirmative vote by at least two-thirds (2/3) of the entire Board of Directors at a Regular or Special Board Meeting, provided that written notice of such meeting has described the proposed sale and the reasons for the proposal. Bylaws Of Cape Fear Housing Land Trust, Inc. 11 Section 15.03 Ownership of Leasehold Estates. In accordance with the purposes of the Corporation, the Board of Directors shall take appropriate measures to promote and facilitate the ownership of leasehold estates on the Corporation's land by low- to middle-income households. These measures may include but are not limited to: provisions for the sale of leaseholds to such households; provisions for financing the acquisition of housing by such households, including direct loans by the Corporation to low- and moderate-income households; and provisions for grants or other subsidies that will lower the cost of housing for low- and moderate-income households. Section 15.04 Re-Purchase by the Corporation of Leasehold Estates Located on the Corporation’s Land. It is a purpose of the Corporation to preserve the affordability of housing and other improvements for low- to middle -income households. Accordingly, the Board of Directors shall assure that, as a condition of the lease, the Corporation is granted the right to re- purchase any Lessee-owned leasehold estate for a price determined by the "resale formula," at such time as the Lessees wish to sell. Section 15.05 The Resale Formula. For the purpose of preserving affordability, the Corporation shall restrict the price that Lessees may receive when they transfer a leasehold interest located on the Corporation’s land. A policy, adopted by the Board of Directors establishes such restrictions in the form of a "resale formula” and was adopted in accordance with the following principles: (a) To the extent possible, the formula shall allow the seller to receive, at a minimum, a price based on the value that the seller has actually invested in the property being sold; and (b) To the extent possible, the formula shall limit the price of the property to an amount that will be affordable for other low- and moderate-income households at the time of the transfer of the leasehold. Section 15.06 Procedures for Altering the Resale Formula. The consistent long-term application of a resale formula is essential to the purposes of the Corporation. Accordingly, the resale formula shall not be altered unless the Board of Directors of the Corporation determines that the current formula presents an obstacle to the achievement of the purposes of the Corporation. In such an event, the resale formula may be altered only by a two-thirds (2/3) vote of the entire Board of Directors. Bylaws Of Cape Fear Housing Land Trust, Inc. 12 ARTICLE XVI. CORPORATE RECORDS Section 16.01 Annual Report to Directors. No later than 90 days after the close of its fiscal year, the Corporation shall provide to the Directors an annual fiscal report of the year’s activities. The report shall be accompanied by an independent audit, or if there is no independent audit, the certificate of an authorized Officer of the Corporation that such statements were prepared without an independent audit. The annual report will contain the following information in appropriate detail: (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 land trusts, 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. ARTICLE XVII. MAINTENANCE AND INSPECTION OF ARTICLES AND BYLAWS. The Corporation shall keep at its principal office in this state, the original or a copy of its Articles of Incorporation and Bylaws as amended to date, which shall be open to inspection by the Directors at all reasonable times during office hours. ARTICLE XVIII. MAINTENANCE AND INSPECTION OF OTHER CORPORATE RECORDS. The accounting books, records, and minutes of the proceedings of the Board of Directors and any Committees of the Corporation shall be kept at such place or places designated by the Board of Directors or in the absence of such designation, at the principal executive office of the Corporation. The minutes shall be kept in written, typed or taped form, and the accounting books and records shall be kept either in written or typed form or in any other form capable of being converted into written, typed or printed form. Upon leaving office, each Officer, employee, or agent of the Corporation shall turn over to his or her successor or the Executive Director, in good order, such corporate monies, books, records, minutes, lists, documents, contracts or other property of the corporation as have been in the custody of such Officer, employee, or agent during his or her term of office. Every Director shall have the absolute right at any reasonable time to inspect all of the Corporation’s books, records, and documents of every kind. The inspection may be made in person or by an agent or attorney, and shall include the right to copy and make extracts of documents. Bylaws Of Cape Fear Housing Land Trust, Inc. 13 ARTICLE XIX. FISCAL YEAR, CONTRACTS, DEPOSIT, CHECKS, AND LOANS Section 19.01 Fiscal Year. The fiscal year of the Corporation shall begin on July 1 of each year and shall end on June 30 of each year. Section 19.02 Execution of Corporate Instruments. Unless otherwise specifically authorized by resolution of the Board of Directors or otherwise required by law, formal contracts of the corporation, deeds, promissory notes, deeds of trust, mortgages, and other evidences of indebtedness of the Corporation, and other corporate instruments or documents, may be executed, signed or endorsed by the President or Vice-President of the Board. From time to time, the signature of the Secretary may be required to attest the signature of the President or Vice-president. The Board of Directors may, in its discretion, determine the method of execution and may designate by resolution the signatory Officer or Officers, or other person or persons, permitted to execute any specified corporate instrument or document, except when otherwise required by law, and such execution or signature shall be binding upon the Corporation. Without this express and specific authorization of the Board of Directors, no Officer or other agent of the Corporation may enter into any contract or execute and deliver any instrument in the name of and on behalf of the Corporation. Section 19.03 Deposit of Funds. All funds of the Corporation not otherwise employed shall be deposited in such banks, trust companies, or other depositories as the Board of Directors from time to time may determine. Section 19.04 Checks, etc. All checks, drafts or other orders for the payment of money shall be signed in the name of the Corporation by such Officers or persons as shall be designated from time to time by resolution adopted by the Board of Directors and placed on record in the Book of Minutes of the Corporation. Section 19.05 Loans. No loans or advances shall be contracted on behalf of the Corporation, and no note or other evidence of indebtedness shall be issued in its name, except as authorized by the Board of Directors. Any such authorization shall relate to specific transactions. The Corporation shall not make any loan of money or property to, or guarantee the obligation of, any Director or Officer. However, the Corporation may advance money to a Director or Officer of the Corporation for expenses reasonably anticipated to be incurred in performance of the duties of such Officer or Director so long as such individual would be entitled to be reimbursed for such expenses absent that advance. Bylaws Of Cape Fear Housing Land Trust, Inc. 14 ARTICLE XX. AMENDMENT OF ARTICLES OF INCORPORATION AND BYLAWS The Organization’s Articles of Incorporation may be amended and these Bylaws may be amended or repealed only by an affirmative vote of two-thirds (2/3) of the entire Board of Directors at any Regular or Special Board meeting, provided that written notice of such meeting has set forth the proposed amendment or replacement, with appropriate explanations thereof. ARTICLE XXI. CONSTRUCTION & DEFINITIONS Unless the context otherwise requires, the general provisions, rules of the construction, and definitions contained in the General Nonprofit Corporation Law of the State of North Carolina as amended from time to time shall govern the construction of these Bylaws. Without limiting the generality of the foregoing, the masculine gender includes the feminine and neuter, the singular number includes the plural and the plural number includes the singular, and the term “person” includes a corporation as well as a natural person. If any competent court of law shall deem any portion of these Bylaws invalid or inoperative, then so far as is reasonable and possible (i) the remainder of these Bylaws shall be considered valid and operative, and (ii) the effect shall be given to the intent manifested by the portion deemed invalid or inoperative. ARTICLE XXII. SEAL The Board of Directors may provide a corporate seal, which shall bear the name of the Corporation. ARTICLE XXIII. CONFLICT OF INTEREST All Directors, officers and employees shall avoid conflicts of interest and the appearance of impropriety. Any Director, officer, or employee having a conflict of interest or the appearance of a conflict of interest on any matter involving the Corporation with any other business or personal interest, shall disclose such conflict to the Corporation and shall refrain from voting on such matters. At least annually, each Director shall acknowledge by signature the Conflict of Interest Policy as adopted by the Board of Directors as Appendix I to these By-laws. The failure or refusal of a Director to so acknowledge the Conflict of Interest shall be grounds for that Director's immediate removal from the Board of Directors. ARTICLE XXIV. DISSOLUTION Upon the dissolution of the Corporation, the Board of Directors shall, after the payment of all the liabilities of the Corporation, dispose of all the assets of the Corporation exclusively for the purposes of the Corporation in such manner, or to such organization or organizations organized and operated exclusively for charitable, educational, religious or scientific purposes as shall qualify as an exempt corporation or organizations and has been recognized by the Internal Revenue Service as Exempt from taxation under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (or of the corresponding provisions of any future United States Revenue Law), as the Board of Directors shall determine. Bylaws Of Cape Fear Housing Land Trust, Inc. 15 Dissolution of the Corporation and distribution of the Corporation’s assets shall require an affirmative vote by two-thirds (2/3) of Lessee and Board of Directors present at a Regular or Special Membership Meeting, a quorum being assembled, provided that written notice of such meeting, including a full description of the plan of dissolution, has been given to all Members of the Corporation no later than three (3) weeks prior to the meeting. Bylaws Of Cape Fear Housing Land Trust, Inc. 16 CERTIFICATE OF SECRETARY I, ~I HOUSING , the duly elected, qualified Secretary of CAPE FEAR ';~,D TR'UST, INC. do hereby certify that the foregoing are the Bylaws adopted by the Board of Directors by action duly taken as of the ~day of ,2009.kd2ru, IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the Corporation this ~da> of -: })1; ~)nf ,2009. ~ / Signature Typed Name Angela Keith, Secretary (CORPORATE SEAL) Bylaws Of Cape Fear Housing Land Trust, Inc. 17 APPENDIX I CAPE FEAR HOUSING LAND TRUST, INC. CONFLICT OF INTEREST POLICY Adopted by Board of Directors February 26, 2009 ARTICLE I PURPOSE The purpose of the conflict of interest policy is to protect this tax-exempt organization’s, Cape Fear Housing Land Trust, Inc. (Organization), interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director of the organization or might result in a possible excess benefit transaction. This policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and charitable organizations. ARTICLE II DEFINITIONS 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. 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 Organization has a transaction or arrangement, b. A compensation arrangement with the Organization or with any entity or individual with which the Organization 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 Organization 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 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 considering the proposed transaction or arrangement. Bylaws Of Cape Fear Housing Land Trust, Inc. 18 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, he/she 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. 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, he/she 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 Organization can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest. 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 Organization’s best interest, for its own benefit, and whether it is fair and reasonable. In conformity with the above determination it shall make its decision as to whether to enter into the transaction or arrangement. 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 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. 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 Organization 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 Organization for services is precluded from voting on matters pertaining to that member’s compensation. Bylaws Of Cape Fear Housing Land Trust, Inc. 19 c. No voting member of the governing board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from Organization, either individually or collectively, is prohibited from providing 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 which affirms such person: a. Has received a copy of the conflicts of interest policy, b. Has read and understands the policy, c. Has agreed to comply with the policy, and d. Understands the Organization is charitable and in order to maintain its federal tax exemption it must engage primarily in activities which accomplish one or more of its tax-exempt purposes. ARTICLE VII PERIODIC REVIEWS To ensure the Cape Fear Housing Land Trust, Inc. operates in a manner consistent with charitable purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted. The periodic reviews shall, at a minimum, include the following subjects: a. Whether compensation arrangements and benefits are reasonable, based on competent survey information and the result of arm’s length bargaining. b. Whether partnerships, joint ventures, and arrangements with management organizations conform to the Organization’s written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes and do not result in inurement, impermissible private benefit or in an excess benefit transaction. ARTICLE VIII USE OF OUTSIDE EXPERTS When conducting the periodic reviews as provided for in Article VII, the Organization may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are conducted. Signature ___________________________________ Printed Name ___________________________________ Date ____________________________________ Bylaws Of Cape Fear Housing Land Trust, Inc. 20