A Step-By-Step Reference Guide To Creating A 501(C)3. Holly West, MS, MPM Rhonda Woolum, RN Erin Schaffner, BS. What is a 501(C)3? And why do I need one?. A 501(C)3 is a type of corporation recognized by the federal government as an organization whose - PowerPoint PPT Presentation
Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.
A Step-By-Step Reference Guide To Creating A 501(C)3
Holly West, MS, MPM
Rhonda Woolum, RN
Erin Schaffner, BS
A 501(C)3 is a type of corporation recognized by
the federal government as an organization whose
general purpose is educational, religious or
Local Health Departments operate as non-profit
organizations but are ineligible for IRS 501(C)3
status because they receive a substantial
portion of their operating funds from the state.
Local Health Departments who develop a separate non-
profit charity with 501(C)3 status will increase access to
to grant funding by as much as 90%.
For tax deduction purposes and legal processes, most
foundations require applicants to obtain 501(C)3 status
to be eligible for grant funding. This restriction on financial
support severely limits funding opportunities available to
public health departments.
In addition, 501(C)3 organizations have increased ability to
fundraise as a means to increase financial support.
A generic outline for the contents of the AOI for a non-profit corporation is as follows:
ARTICLE 1: The name of the corporation
ARTICLE 2: The name and address of the registered agent
of the corporation.
ARTICLE 3: The purpose(s) for which the corporation is being formed.
ARTICLE 4: A statement of the number of initial directors and their names and addresses.
ARTICLE 5: A statement defining the period of existence of the corporation. If it is indefinite– it would be defined perpetual.
ARTICLE 6: A statement detailing the provisions for membership.
ARTICLE 7: A statement of the exemption requirements
ARTICLE 8: Contact information for all incorporators.
“An organization’s success depends in large part on how well it goes about establishing its structures and methods for making decisions…”
(A generic outline)
A sample draft of Eastern Kentucky Public Health Inc’s
Bylaws can be found in the Appendices.
Both form 1023 and instructions can be found in the Appendices
EASTERN KENTUCKY PUBLIC HEALTH INC.
Article 1. NAME
1.1Name. The name of the organization shall be Eastern Kentucky Public Health, Inc.
(“CORPORATION”) and shall operate as a non-profit, non-stock Corporation.
Article II. PURPOSE
2.1 Purpose. To operate as a charitable organization organized exclusively for charitable,
educational, and scientific purpose, including, for such purposes, the making of distributions to
organizations that qualify as exempt organizations under 501(c)3 of the Internal Revenue
Code, and to solicit, receive, and manage contributions from individuals, businesses, and
organizations made for the above purposes.
2.2 Propaganda. The CORPORATION shall not carry on propaganda or otherwise attempt to
influence legislation and shall not participate in any political campaign on behalf or in
opposition to any candidate for public office.
Article III. NO CAPITAL SHARES
3.1 No Capital Shares. The CORPORATION shall have no capital shares or shareholders, and
its business and affairs shall not be conducted for private pecuniary gain or profit, nor shall
any of the CORPORATION’s gain profit or property inure to incorporators thereof, nor any
officer or director thereof, but the CORPORATION’s entire gain, profit, net earnings and
property shall be devoted exclusively to the charitable and other uses and purposes set out in
Article II of these Bylaws.
3.2 Compensation. The CORPORATION shall be authorized to pay reasonable compensation for
services rendered to any third-party individual and/or Corporation.
3.3 Loans. No loans shall be made by the CORPORATION to its officer or Directors
Article IV. MEMBERSHIP
4.1 Qualification of Members. Membership will be open to all interested parties residing in the
Eastern Kentucky counties of: Boyd, Carter, Elliot, Floyd, Greenup, Johnson, Lawrence,
Lewis, Magoffin and Pike.
Article V. OFFICERS
5.1 Number. The officers of the CORPORATION shall be a President, a Vice-President, a
Secretary and a Treasurer. Additional officers and assistant officers may be deemed
necessary, may be elected or appointed by a majority vote of the current directors.
5.2 Appointment. The President, Vice-President, Secretary, and Treasurer will be approved by
the general membership after being selected by the current Board of Directors at the first
annual meeting of the calendar year.
5.3 Term. The officers of the CORPORATION shall be elected annually. Each officer shall hold
office until his successor has been duly elected and shall have qualified or until his death,
resignation, or removal in a manner provided within these bylaws.
5.4 Duties of the President.
a. The President shall be the chief executive officer of the organization; he/she shall
preside at all meetings of the members of the Board of Directors, he/she shall have
general and active management of the affairs of the CORPORATION, shall see that all
orders and resolutions of the Board of Directors are carried into effect, subject,
however, to the right of the Directors to delegate any specific powers, except such as
may be by statute exclusively conferred on the President, to any other officers of the
b. The President shall be responsible for calling all regular and special meetings of the
c. The President shall be responsible for giving guidance to all activities of the
d. The name of the President shall be one of the names on the signature card at the bank
and shall have the authority to sign checks for the CORPORATION. The President may
appoint committees as needed and membership of said committees shall be ratified by
the Board of Directors.
5.5 Duties of the Vice President.
a. The Vice-President shall act in all cases for and as the President in the latter’s absence,
incapacity, or at the President’s request, and shall perform such other duties as he may
be required to do from time to time.
b. The Vice-President shall be responsible for call all regular and special meetings of the
c. Should an elected office be vacated, the Vice-President shall assume the corresponding
duties until a new officer is elected.
5.6 Duties of the Secretary.
a. Keep the minutes of the meetings of the Board in one or more books provided for that
purpose, see that all notices are duly given in accordance with the provisions of these
Bylaws or as required by law, accept notification of proxies from Board.
b. Be custodian of the corporate records and of the seal, if any, of CORPORATION, be
responsible for authenticating records of CORPORATION, keep a register of the
contact information for each member of the Board; and in general, perform all duties
incident to the office of Secretary and such other duties as from time to time may be
assigned to the Secretary by the Chairman of the Board, the President or the Board.
5.7 Duties of the Treasurer.
a.The Treasurer will have custody of the corporate funds and securities and shall keep
full and accurate account of receipts and disbursements in books belonging to the
CORPORATION, and shall keep the monies of the CORPORATION in a separate
account to the credit of the CORPORATION.
b. The Treasurer shall disburse funds of the CORPORATION as may be ordered by the
Board of Directors, taking proper vouchers for such disbursement, and shall render to
the President and Directors, at the regular meetings of the Board, or whenever they may
require it, an account of all transactions as Treasurer and of the financial condition of the
Article VI. BOARD OF DIRECTORS
6.1 Number and Composition of Board of Directors. The number of directors of the
CORPORATION shall not be less than one nor more than twelve. Each director shall hold
office until the next annual election and until his successor has been elected and qualified.
The composition of the Board of Directors shall initially consist of the elected officers
including the President, Vice-President, Secretary, Treasurer and four members at large, for
a total of eight members.
6.2 Organization Management. The business and affairs of the CORPORATION shall be
managed by its Board of Directors, as may be chosen from time to time. The Directors must
meet the eligible membership requirements of the organization.
6.3 Two-Thirds Majority Rule. A two-thirds majority of Directors in office shall be necessary to
constitute a quorum for the transaction of business and the acts of a majority of the Directors
present at the meeting at which a quorum is present shall be acts of the Board of Directors.
6.4 Voting Rights. Each Director shall have one vote.
6.5 Vacant Director Seat. Should the seat of director be vacated for any reason, the Board may
name a replacement by the vote of majority of directors then in office.
6.6 Succession of Power. The line of responsibility shall be defined as President, Vice-President,
Secretary, Treasurer, and general Directors.
6.7 Emergency Quorum. The quorum shall be suspended in case of an emergency, as
deemed such by at least two officers and at least one other Director. The Directors so
acting shall make a good faith attempt to give notice to all other Directors. Any vote
taken under such circumstances shall require the unanimity of those members of the
board present at the time.
6.8 Committees. The board, by resolution, may designate from among its members an
executive committee and any other committees, each consisting of at least one director
and/or member and additional member of the CORPORATION.
6.9 Attendance Requirement and Proxy. Board members are expected to attend each
regular Board meeting. If a Board member anticipates having to miss a regular meeting,
he or she shall have another Board member, serve as Proxy at the Board meeting. Notice
of Proxy shall be given prior to the meeting to the Secretary.
6.10 Removal and Resignation. Any member of the Board may be removed, with or
without cause, by an affirmative vote of 2/3 of the Board or by operation of these
bylaws. Any member of the board may resign from the Board at any time by giving
thirty (30) days written notice to the Board.
6.11 Vacancies. In the event a vacancy in the Board caused by the resignation of a current
Board member or the normal rotation of directors into an officer’s role, the current
Board will review potential candidates for membership on the board and present a
recommendation to the board for approval.
6.12 Contract Rights of the Board. Election or appointment of a director, officer or agent
shall not affect that individual’s contract rights, if any, with CORPORATION. The
resignation of a director, officer or agent shall not affect CORPORATION’s contract
rights, if any, with the officer.
6.13 Manner of Acting. The act of the majority of the directors present at a meeting at
which a quorum is present shall be the act of the directors.
6.14 Compensation. No compensation shall be paid to directors, as such, for their services
as a director. Nothing herein contained shall be construed to preclude any director
from serving the CORPORATION in any other capacity and receiving compensation
Article VII. MEETINGS
7.1 Meetings of the Board. Regular meetings of the board shall be held at least two times \
per year and shall be set by the Board for the purpose of transacting such business as
may come before the meeting. The date, time and place of all meetings of the Board
shall be designed by the President, at the first meeting following election of the officers
each year. Such date, time and place may be changed upon at least 48 hours written
notice by personal delivery, mail, fax, or electronic mail to each of the Directors. The
first meeting of the Board shall occur in January of each calendar year for the purpose
of electing officers. The second meeting shall occur approximately six months
7.2 Special Meetings. Special meetings of the Board may be called, by or at the request of,
the President or any five directors of the CORPORATION. Notice of the date, time and
manner of any special meeting shall be given at least 48 hours prior thereto by written
notice faxed, electronically mailed, or delivered personally to each Board Member.
Special meetings of the Board may be held at any such place as many be specified in the
notice of the meeting, via telephone conference call, or via other electronic means,
provided that all Board members are given the opportunity to participate, and shall not
be excluded for any reason if such desire to participate is expressed. If such meeting is
conducted via electronic means, the meeting shall be considered to commence at the time
of transmittal by the party initiating the special meeting, and shall be considered
adjourned by the end of business two days following commencement of such meeting.
Business that is conducted at a special meeting via conference call or electronic means is
only valid if each and every Board member has cast an affirmative or negative vote, or
proactively enters an abstention to the record, in written form, as set forth in these
7.3 Quorum and Voting. Unless the Articles require a greater or lesser number, a two-thirds
majority of the number of directors elected shall constitute a quorum of the Board; provided,
however, that if less than a two-thirds majority of the directors are present at said meeting, a
majority of the directors present may adjourn the meeting from time to time without further
7.4 Action Without a Meeting. Any action required or permitted to be taken at any meeting of the
Board may be taken without a meeting if the text of the resolution of matter agreed upon is sent
to all of the Directors in office all the Directors in office consent to such action in writing
setting forth the action taken. Consent will be deemed granted upon receipt of written notice to
such to the President or Executive Director by the date and time specified in the request for
action. Email and faxed consents shall also fit the definition of “written notice.” Such consent
in writing shall have the same force and effect as a vote of the Board at a meeting and may be
described as such in any document executed by CORPORATION.
Article VIII. CONTRACTS, LOANS, CHECKS AND DEPOSITS
8.1 Contracts.The Board may authorize any officer or agent to enter into any contact
negotiations and deliver any instruments in the name of and on behalf of CORPORATION.
Such authority may be general or confined to specific instances. In any case, all contracts
over the amount of $500.00 much be executed only upon Board approval. No Board Member
can enter any contract individually.
8.2 Corporate Loans. No loans shall be contracted on behalf of CORPORATION, and no
evidences of indebtedness shall be issued in CORPORATION’s name, unless authorized by a
resolution of the Board. Such authority may be general or confined to specific instances. Only
officers with official financial signatory authority as set forth in these Bylaws, or by resolution
of the Board may execute these documents on behalf of CORPORATION. Such agreements
shall only be entered into upon Board approval.
8.3 Checks, Drafts, Etc. All checks, drafts or other orders for the payment of money, notes or
other evidences or indebtedness issued in the name of CORPORATION shall be signed by
such officer or agent of CORPORATION and in such manner as shall, from time to time, be
determined by resolution of the Board, and in accordance with these bylaws.
8.4 Deposits. All funds of CORPORATION not otherwise employed shall be deposited, from time
to time, to the credit of CORPORATION in such banks, trust companies and other
depositories as the Board may select.
Article IX. MISCELLANEOUS PROVISIONS
9.1 Construction. Unless the context specifically requires otherwise, any reference in these
Bylaws to any gender shall include all other genders, any reference to the singular shall include
the plural and any reference to the plural shall include the singular.
9.2 Limitations. Notwithstanding any other provision hereof, including, but not limited to, any
provision of its Bylaws, CORPORATION shall take no action contrary to the provisions of any
laws or regulations governing the entity.
9.3 Severability or Provisions. If any provision of these Bylaws, or its application to any person or
circumstances, is held invalid or unenforceable by a court of competent jurisdiction the
remainder of these Bylaws, or the application of such provisions to persons or circumstances
other than those to which it was held to be invalid or unenforceable, shall not be affected
thereby, and to this extent, the provisions of these Bylaws are severable
9.4 Amendments to these Bylaws. These Bylaws may only be amended by affirmative vote of 2/3
of the Board, at a regular meeting, after having at least thirty (30) days to review the
amendments. Any and all amendments shall be made in accordance with all federal, state and
local laws and regulations, and provisions set forth in the CORPORATION Bylaws.
9.5 Indemnity. To the full extent permitted by the laws of the Commonwealth of Kentucky, the
CORPORATION shall indemnify its Directors, Officers, and Members for, and hold the same
harmless from, any loss or damage incurred by them by reason of any act or omission so
performed or omitted by them (and not involving fraud, bad faith or gross negligence). To the
full extent authorized or permitted by the Act, the CORPORATION shall pay or reimburse
reasonable expenses (including reasonable attorneys' fees) incurred by them in a proceeding in
advance of final disposition of such proceeding, provided they agree, in such form as the other
Directors, Officers, and/or Members, respectively shall request, to reimburse the
CORPORATION if it is ultimately determined that the Directors, Officers, and/or Members did
not meet the standard for indemnification set forth in this section. The CORPORATION may
purchase and maintain insurance on behalf of the Directors, Officers, and/or Members against
any liability asserted against or incurred by a Directors, Officers, and/or Members as a result of
being a Directors, Officers, and/or Members, whether or not the CORPORATION would have
the power to indemnify such person against the same liability under the provisions of this
section or the laws of the Commonwealth of Kentucky.
9.6 Notifications. All Notices required or permitted under this Agreement must be in writing and
delivered personally against a written receipt, sent by reputable messenger service (such as
Federal Express, UPS, etc.) for overnight delivery, transmitted by confirmed telephonic
facsimile (fax), sent by certified, express, or registered mail, postage prepaid, return receipt
requested, or sent via electronic mail. A Notice to the Company must be addressed to the
Company at the Company's principal office. Any party may designate, by notice to all of the
others, substitute addresses or addressees for Notices, and thereafter Notices are to be directed
to those substitute addresses or addressees.
9.7 Complete Agreement. This Agreement constitutes the complete and exclusive statement of
the agreement among the Directors, Officers, and Members. It supersedes all prior written and
oral statements, including any prior representation, statement, condition, or warranty.
9.8 Applicable Law. All questions concerning the construction, validity, and interpretation of this
Agreement and the performance of the obligations imposed by this Agreement shall be
governed by the internal law, not the law of conflicts, of the Commonwealth of Kentucky.
9.9 Section Titles; Section References. The headings herein are inserted as a matter of
convenience only, and do not define, limit, or describe the scope of this Agreement or the
intent of the provisions hereof. All references herein to Sections shall refer to Sections of this
Agreement unless the context clearly requires otherwise.
9.10 Binding Provisions. This Agreement is binding upon, and inures to the benefit of, the parties
hereto and their respective executors, administrators, heirs, successors, and permitted
9.11 Counterparts. This Agreement may be executed simultaneously in two or more
counterparts each of which shall be deemed an original, and all of which, when taken
together, constitute one and the same document. The signature of any party to any
counterpart shall be deemed a signature to, and may be appended to, any other counterpart.
The above Bylaws were adopted by the Eastern Kentucky Public Health, Inc. Board of Directors effective as of ________________, 2009