SR-106-004 (11)
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AC:DL:dvm:Lutzl
Council Mtg. 3/27/84
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Santa Monica, California
10--:8
MAR 2 7 1984
TO: Mayor and Clty Council
FROM: Arts Cornmlssion
SUBJECT: Approval of the Articles of Incorporation
and the Bylaws of the Santa Monica Arts
Foundatlon and an Initial "Start-Up" Loan
for Fundraislng Purposes.
INTRODUCTION
ThlS report requests that City Council (A) approve the Articles
of Incorporation and Bylaws of the Santa Monica Arts Foundatlon
and (B) allow the Foundation to borrow up to $15,000 of
"start-up" funds to begln ltS fundralsing efforts.
BACKGROUND
One of the 1983 Performance ObJectives of the Arts Commisslon lS
to form a "BUSlness Committee for the Arts" and a "Friends of the
Arts."
These two groups will be the two fundralslng components
of the proposed Santa Monica Arts Foundatlon.
In approving the
formation of the Foundation at its meeting on July 26, 1983, Clty
CounCll requ1red that it be able to approve the Articles of
Incorporatlon and Bylaws of the Foundatlon.
These documents
(Attachment A) have been prepared and rev1ewed by the Arts
Commiss10n and are now presented to Counc11 for approval.
The Foundation wl1l requlre "start-up" or "seed" money to support
the blginning of lts fundraising efforts. Mr. Herbert Kendall,
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MAR 2 7 1984
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Chair
of
the
of
Arts Commission and a member of the Board of
the Foundation, has offered the Foundation a
loan for this purpose. According to Article V,
Paragraph (iv) of the proposed Bylaws of the
its Directors may borrow money with the prior
Directors
no-interest
Section 1,
Foundation,
approval of City Council.
BUDGET/FINANCIAL IMPACT
At the present time there is no budget impact on the City
resulting from approval of the Foundation's Articles of
Incorpora~ion., Bylaws, and initial loan. However, the
Foundation has been directed by City Council to have as its goal
a fundraising plan in which it will generate two-to-one matching
funds from the private sector for the Arts Commission's budget
within three years.
RECOMMENDATION
The Arts Commission respectfully requests that City Council (A)
approve the Articles of Incorporation and Bylaws of the Santa
Monica Arts Foundation and (B) allow the Foundation to borrow up
to $15,000 in a no-interest loan to begin its fundraising
efforts.
Pr~pared by: David Lutz, Director
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ARTICLES Of INCORPORATION
OF
THE S;;JHA HONICA ARTS fOUNDATION, rHC.
ARrICLE I - u.;;,"':e
lhe name of this corporatIon 1S The Santa MonIca Arts
Fou:1datlon, Inc.
ARTICLE II - FUR?OSE
A TIllS corporation is a nonFroflt publIc benefit
c'Jrp:)ratloll and IS not otgarllzed for the private gain of any
person It IS organIzed 'J.nder: the ~ronpcofit Public BenefIt
corporatIon Law for charitable purposes.
B The 3reClfic r~rrosc of this corporatIon is to promote
':.~:C! arts by rals:ng funJs from the general publlc .",'hICh wIll be
usnj to fInance such art programs as the Santa Monica Acts
(_C!"'flIS:;lOll. estJ.bllstled by the Clty of Santa Honica. a
IT1'1:llc~pal cort'r;r:~tion. may sponsor flam time to tIme. includlng
b'lt not lInlted to public art festivals, outreach programs and
art eX:l1bltS.
i1.P.TICLE III - AG!:JH FOR SERVICS OF PKOCESS
Ihe na'Te ani acdres:3 1n the Sta~e of Cal ifcrrna of this
c'Jrj?oratlon's lrllt~al agea: for seCllce of process IS Alan U.
Sch.....artz, flnley. Kucnble. ~a:;ller, HeIne, Underberg, ~'anley &
Casey, 9100 Wllshlre Boulevard, Beverly Hills, CalIfornia 90212.
ARTICLE IV - LIMITATION ON CORPORATE ACTIVITIES
A ThIS corpuration IS organIzed and operared excluslvely
for cha~ltable purposes wl~hin the meanIng of Sectlon 501{c)(3)
of the Internal Revenue Code.
B. Notwlt.hstandlng any other Frovlslon of these articles,
thiS corporation shall not. except to an InsubstaIltial degree,
en3age in any actIVIties or exerCIse any powers that are not in
furtherance of the purposes of thIS corporation.
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c no substantlal part of the actl'ntIes of thiS
COrFQr2tlon sh~ll consIst of carrYIng on propaganda, or
cth8L',o/lse attewrtll1'j to lnfluence leglslatlon. and the
corporation shall not partiCIpate or 1Iltervene In any politlcal
ca~ral~n (lncludin1 the publlshlnl or dIstrlbutlon of
staterr.ents) on behalf 'of any candldate for public office,
8 lIo part of the net earnIngs of the corporatIon shall
1~1''':['e to the benefIt of. or be di5trlbLltable to Its dIrectors.
~ffIcers, or other prlvate persons, except that the corporation
3l1all b~ authorized to pay reascnable cO~Fensation for serVIces
render~d ar~d to [flake payments and distributions in furtherance
of the purroses set forth 1n Article II hereof.
E The corporatl011 sh~ll dIstribute Its income for each
t~~ab19 year at such tI~e and In such manner as not to become
3Jb]ect to the tax on undIstrIbuted Income Imposed by Section
4J42 of tr.e Internal Rp';enue Code of 1154, or correspondIng
pro"J1S1011S of any subsequent federal tax laws.
f 11'e c:npuratloll stlall [~Dt €'nqage in any act of
self-dealln~ as deflneJ 1n SectIoll 4911(d) of the Internal
['~-:':<::'1'~~ Code of 1954. o::>r corresponding provISIons of any
5~bsequent federal tax laws,
G The corpnatlon d:all not retaIn any excess bUSlr18S::>
h~lJlngs as defIned ~n Sectlcll 4943 (el of the Internal Revenue
C-::"11O.' of 1 J54. or correSpOl1dlI'l.:J pro.....IsIons of any subsequent
federal tax la~s
H T~e cor~O[atlon shall not ~ake any Investments In such
tT'Cl.nr:er ;;lS to subject lt to tax under SectIon 4944 of the
Illternal R~:enue Code of 1954. or corresponding provisions of
any subsequent Federal tax la~s,
I. The cot~utatlon shall not ma~e any taxable
,=zre~ldlturI?S as deflned 111 SectIon -\345{d) of the Internal
Fe'd:'flue Code of 1954, or correspondIng provisions of any
subsequent Federal tax la~s.
ARTICLE V - DEDICATION ill1D DISSOLUTION
The pro~eLty of thIS corporatIon 1S Irrevocably dedicated
to charIta~le [urposes Upon the dissolutIon or WindIng up of
the cQrporatlon, Its assets rema1ning after payment. or
provIslon foe payment. of all debts and l~abllities of this
corporatIon shall be distributed to a non-profit fund,
foundatIon or corforation Wh1Ch is organIzed and operated
exclUSIvely for charItable purposes and which has established
its ta~ exenpt status under Section 501 (c)(3) of the Internal
R'.nenue Code, Any such assets not so dlsposed of shall be
disposed of by the Super lor Court of the county In whIch the
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p~ ;'~lClr~l offIce of the cQrroratloIl 15 then located,
exc~~s::ely for such charItable purposes or to such
C[~1'~I;::'1tlOIlS .....hich are orga~ized and operated exclusively for
charitable purposes as sal.d Court shall determl.ne.
Dated: November 14, 1983.
Incorporator
I ~lOu:!bi declare that I am the persoll .....ho executed the
fc;re'--:J'-)lllg Artlcles of Incorporatlon, which execution is my act
and deed
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BY-LAWS
OF
THE SANTA MONICA ARTS FOUNDATION, INC.
ARTICLE I
NAME
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Section 1. PRINCIPAL OFFrtE.. The corporat~on's
principal office shall be fixed and ocated at such place in the
C~ty of Santa Mon~ca, Cal~fornia as the Board of Dlrectors
(herein called the "Board") sh 1 determlne. The Board 15
from one locat1on to anot:r. /
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Section 2. OTHER 0 CBS. Branch or subordinate offices
may be established- atDnyj'tlme by the Board at any place or
places wlth1n the City ~sarta Monica.
r~ .\\ II
\ ~\) / ARTICLE III
\ \ NO/PARTISAN ACTIVIT.IES
\J ./
This corporat~n has been formed under the Callfornla
Nonproflt PubllCj Benef1t Corporatlon law for the purposes
descrlbed In th~i Articles of Incorporation and it shall be
nonproflt and no~art~san. No substantial part of the actlvitles
of the corpgiatlon shall conslst of the publlcatlon or
dissem~nation hf mater~als w~th the purpose of attempting to
influence le~islatlon, and the corporatlon shall not partlcipate
or lntervene ~n any polltlcal campalgn on behalf of any candidate
for p~blic loffice or for or agalnst any cause Dr measure belng
submitted tp the people for a vote.
The /~orporation shall not, except in an insubstantial
degree, iengage in any activitles or exerC1se any powers that are
not In;furtherance of the purposes described In the Articles of
Incorpo'ra tlon.
OFFICES
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The Santa Monica
The name of thlS corporat1on
Arts Foundation, Inc.
ARTICLE II
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BY-LAWS
OF
THE SANTA MONICA ARTS FOUNDATION, INC.
ARTICLE I
NAME
The name of th~s corporat~on shall be The Santa Monlca
Arts Foundation, Inc.
ARTICLE II
OFFICES
Sect~on 1. PRINCIPAL OFFICE.. The corporation's
pr1nclpal off1ce shall be fixed and located at such place 1n the
C1ty of Santa Mon~ca, Cal~fornia as the Board of Directors
(here~n called the "Board") shall determ~ne. The Board is
granted full power and authority to change sald prlncipal off~ce
from one locatlon to another.
Section 2. OTHER OFFICES. Branch or subordlnate offlces
may be establ~shed at any tlme by the Board at any place or
places withln the C~ty of Santa Monica.
ARTICLE III
NONPARTISAN ACTIVITIES
~is corporation has been formed under the Californla
Nonprofit Public Beneflt Corporation law for the purposes
described In the Articles of Incorporation and it shall be
nonprof~t and nonpart~san. No substantial part of the actlv1tles
of the corporat~on shall cons~st of the publication or
dissemlnation of materlals with the purpose of attempting to
1nfluence legislat~on, and the corporatlon shall not particlpate
or lntervene in any polit1cal campalgn on behalf of or In
oppositlon to any candidate for publ~c offlce or for or against
any cause or measure be~ng subm~tted to the people for a vote.
The corporation
degree, engage in any
not in furtherance of
Incorporation.
shall not, except ~n an insubstant~al
act~vlt~es or exerc~se any powers that are
the purposes descr~bed in the Artlcles of
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ARTICLE IV
MEMBERS
Sect10n 1. DIRECTORS AS THE ONLY MEMBERS. The Directors
of this corporation w1ll be its only members. Any act10n which
would otherwise requ1re a vote of mewbers of a nonproflt
corporation shall requlre only a vote of the Dlrectors. All
r1ghts which would otherwise vest 1n the members of a nonproflt
corporatlon shall vest in the Dlrectors.
Sectlon 2. REGULAR MEETING. A regular meeting of Dlrectors
shall be held on June 1 of every year commenc1ng 1n 1984
(hregular meetlng") for the purpose of electing Dlrectors and to
transact any other proper business WhlCh may be brought before
the meetlng.
ARTICLE V
DIRECTORS
Section 1.
POWERS.
(a) General Corporate Powers. Subject to the
provis1ons of the California Nonproflt Corporatlon law and any
lim1tations 1n the Articles of Incorporatlon and these Bylaws
relating to action requlred to be approved by the members, the
buslness and affalrs of the corporation shall be managed, and all
corporate powers shall be exercised, by or under the dlrection of
the Board of Directors.
(b) Speclfic Powers.
general powers, and subject to
Dlrectors shall have the power to:
W1thout prejudice to these
the same limitations, the
(i) Select and remove all off1cers,
agents, and employees of the corporatlon~ prescrlbe any
powers and dutles for them that are conslstent with law,
w1th the artlcles of incorporation, and wlth these Bylaws;
and f1X the1r compensat1on.
(11) Change the principal executlve office
or the principal business office in the Clty of Santa Monica
from one locat1on to another; cause the corporatlon to be
qualified to do business in any other state, territory,
dependency, or country and conduct business wlthln or
outslde the State of Cal~fornla~ and designate any place
withln or outs1de the State of Cal1fornia for the holdlng of
any meetlng or meetings 1ncludlng regular meetlngs.
(iii) Adopt, make, and use a corporate seal
and alter the form of the seal and certlflcate.
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(~v) With the prior approval of the Santa
Monlca City Counc~l, borrow money and incur ~ndebtedness on
behalf of the corporat~on and cause to be executed and
delivered for the corporatlon's purposes, ln the corporate
name, prom~ssory notes, bonds, debentures, deeds of trust,
mortgages, pledges, hypothecat~ons, and other eVldences of
debt and securities.
Sectlon 2. NUMBER AND QUALIFICATION OF DIRECTORS. The
authorized number of Dlrectors shall be nlne (9). The maJority
of Dlrectors shall 11ve or work ln the Clty of Santa Monlca and
all Directors must be residents of the State of Callfornla.
Section 3. ELECTION AND TERM OF OFFICE OF DIRECTORS.
Directors shall be appolnted by the C~ty Council of the Clty of
Santa Monlca upon the recoITmendat~on of the Santa Monica Arts
Commlssion. Three (3) out of nine (9) Dlrectors shall be members
of the Santa Monlca Arts Commlssion. All nine (9) Directors
shall serve as Director for an lnitlal term of three (3) years
and shall then serve an additional term as follows: (~) three (3)
Directors shall serve for three (3) yearsi (11) three (3)
Dlrectors shall serve for two (2) yearsi and (~ii) three (3)
Dlrectors shall serve for one (1) year. Thereafter, all
Dlrectors shall be elected for terms of three (3) years, provided
that at all tlmes three (3) out of nlne (9) Dlrectors are members
of the Santa Monica Arts Commisslon.
Sectlon 4. VACANCIES.
(a) Events Causing Vacancy. A vacancy or vacancies In
the Board of Directors shall be deemed to exist on the occurrence
of the followlng: (1) the death, reslgnation, or removal of any
Director, (il) the declarat10n by resolution of the Board of
Dlrectors of a vacancy of the office of a Director who has been
declared of unsound mlnd by an order of court or convlcted of a
felony or has been found by final order or Judgment of any court
to have breached a duty under Sections 5230 and following of the
Californ1a Nonprofit Corporatlon law, (iii) the vote of five (5)
Santa Mon~ca C~ty Councll members to remove a Director, (lV) the
lncrease of the authorized number of D~rectors, or (v) the
failure of the Santa Mon1ca Clty Councll to appoint any Dlrector
or Dlrectors.
(b) Resignatlons. Except
paragraph, any Dlrectar may reSlgn,
effectlve on givlng written notlce
Board, the Presldent the Secretary,
unless the notice specif~es a later
become effectlve.
as provlded 1n this
which reslgnatlon shall be
to the Cha~rperson of the
or the Board of Directors,
time for the reslgnation to
(c) No Vacancy on Reduction of Number of D~rectors. No
reductlon of the authorlzed number of Directors shall have the
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effect of removing any D~rector before that Director's term of
office exp~res.
Section 5. PLACE OF MEETING. Meet1ngs of the Board shall
be held at any place within the C1ty of Santa Monica which is
open to the publ1C and which has been des~gnated from t~me to
t1me by the Board. In the absence of such designation, regular
meetings shall be held at the prlnclpal off1ce of the
corporat1on, 1n which case the principal office of the
corpor~ltlon shall be open to the publlc for the meeting of the
Board.
Section 6. ANNUAL MEETINGS. The Board shall hold an
annual meeting for the purpose of organlzation, electlon of
officers, and the transact10n of other bUSlness.
Section 7. REGULAR MEETINGS. Regular meetlngs of the
Board shall be held on such dates and at such t1mes as may be
flxed by the Board. Notlce of regular meetlngs shall be
published once in a newspaper of general clrculat10n 1n the City
of Santa Monlca and shall be sent to the City Clerk, the City
Manager, and the Santa Monlca Arts Commlss1on not fewer than four
(4) nor more than ten (10) days before such meetlng. The notice
shall speclfy the buslness lntended to be conducted at the
meetlng, but any buslness transacted at such meeting shall be
valldly conducted, so long as not otherwise inconslstent w1th
law, the Articles or these Bylaws.
Section 8.
SPECIAL MEETINGS.
Special meetlngs of the Board of D1rectors for any purpose
may be called at any time by the Cha1rperson of the Board or the
President or any vlce-President the Secretary, or any two
Dlrectors.
Sptclal meetings of the Board shall be held upon four days
notlc0 by flrst-class mail or 48 hours not1ce given personally or
by telephone, telegraph, telex, or other slmilar means of
communication. Any such not1ce shall be addressed or delivered
to each Director at such Dlrector's address as it shown upon the
records of the corporatlon or as may have been glven to the
corporatlon by the Director for purposes of notlce, or, lf such
address 15 not shown on such records or is not readl1y
ascertalnable, at the place ln WhlCh the meetings of the
Dlrectors are regularly held. Such notice shall also be given
to: (a) Two (2) daily newspapers of general clrculatlon 1n the
Clty of Santa MOnlCaj (b) such other news medla ln the County of
Los Angeles that has flIed a wrltten request therefor with the
Secretary of the corporatl0nj and (c) the Clty Clerk, the Clty
Manager, and the Santa Monlca Arts Commlsslon. The notlce shall
speclfy the purpose of the meeting, but any business transacted
at such meetlng shall be val1dly conducted, so long as not
otherwise 1nconslstent with law, the Artlcles or these Bylaws.
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Not~ce by mall shall be deemed to have been given at the
t~me a wrltten notice is deposited 1n the Unlted States malls,
postage prepald. Any other written notice shall be deemed to
have been given at the t~me it is personally delivered to the
recipient or is delivered to a common carrier for transmlsslon,
or actually transmltted by the person given the notice by
electronlc means, to the reclpient. Oral notice shall be deemed
to have been given at the time lt lS communicated, 1n person or
by telephone or wlreles8, to the rec1pient or to a person at the
off~ce of the reclp1ent who the person giving the notice has
reason to believe w1ll promptly communicate lt to the recelver.
section 9. QUORUM. A majorlty of the authorized number of
Dlrectors shall constltute a quorum for the transactlon of
bU81ness, except to adjourn as provlded in Sect10n 10 of thlS
Art1cle v. Notwithstanding the foregoing, no quorum shall exist
unless at least one member of the Board of Directors who is also
a member of the Santa Monlca Arts Commisslon 18 present. Every
act or decislon done or made by a maJor1ty of the Dlrectors
present at a meeting duly held at which a quorum is present shall
be regarded as the act of the Board of Dlrectors, subJect to the
provlsions of the Californla Nonprofit Corporat1on Law, except
those provlsions relating to (i) approval of contracts or
transactions 1n Wh1Ch a D~rector has a direct or indlrect
materir,l financial interest, (i~) appo1ntment of committees, and
(lli) ldemnlficat10n of Dlrectors. A meeting at which a quorum
is inlt1ally present may cont1nue to transact bus1ness,
notw~thstandlng the wlthdrawal of Dlrectors, lf any act10n taken
15 approved by at least a maJority of the requlred quorum for
that meeting.
Sect~on 10. PARTICIPATION IN MEETINGS BY CONFERENCE
TELEPHONE. Members of th Board may partlclpate in a meeting
through use of conference telephone or similar communicatlons
equipment, so long as all persons particlpat1ng in or present at
such meeting can hear one another, and so long as not less than a
quorum of the Board is present in person at the meet~ng. In
order to vote at such a meetlng, any Dlrector partlcipatlng
through the use of conference telephone or similar comrnunicatlons
equipment must have so participated for the entire portion of
such rneetlng preceding such vote.
Sect~on 11. WAIVER OF NOTICE. Notlce of a meeting need not
be given to any Dlrector who signs a waiver of notice or a
wrltten consent to holdlng the meeting or an approval of the
minutes thereof, whether before or after the meeting, or who
attends the meet1ng without protestlng, prlor thereto or at its
commencement, the lack of notice to such Director. All such
walvers, consents, and approvals shall be flIed w1th the
corporate records or made a part of the minutes of the meetlngs.
8fctlon 12. ADJOURNMENT. A ma]Orlty of the Dlrectors
present, whether or not a quorum 15 present, may adjourn any
Dlrectors' meetlng to another tlme and place. Notice of the time
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and place of hold~ng an adJourned meeting need not be g~ven to
absent D1rectors. nor to the news med1a. the C1ty Clerk or the
City Manager if the time and place ~s fixed at the meet1ng
adJourned. except as prov1ded in the next two sentences. If the
meeting 1S adJourned for more than seventy-two (72) hours. not1ce
of any adJournment to another time or place shall be given prior
to the t~me of the adJourned meeting to the Directors who were
not present at the t~me of the adJournment. A written notice of
adJournment sett1ng forth the time and place of the adjourned
meeting shall be conspicuously posted on or near the door of the
place where the regular. adJourned regular, special or adJourned
special meetlng was held Wlthln 24 hours after the t1me of
adJour1lment, and shall remain posted untl1 at least the time
specified thereln for the commencement of the adJourned meeting.
Sectlon 13. PUBLIC MEETINGS. All meetings of the Board
shall be open and publlC. and any person shall be permltted to
attend any meetlng of the Board, except as otherwlse provided in
this sectlon. Members of the public shall be ent1tled to
particlpate 1n accordance w1th such rules as may be adopted by
the Board from time to tlme. Nothing contained in th1S sect~on
or these Bylaws shall be construed to prevent the Board from
holding closed seSSlons to the extent permitted by applicable law
(a) for the purpose of discusslng matters related to lit1gat1on.
includlng pend1ng. threatened or anticipated litlgatlon; (b) to
conslder the appolntment, employment, evaluation of performance,
or dismissal of an employee or to hear complalnts or charges
brought against an employee by another person or employee unless
such employee requests a publlC hearing or (c) for such other
purposes as may be permitted by the Ralph M. Brown Act
(Cal1fornla Government Code Sectlons 54950 (et seq.); provlded,
however, that the flnal vote of the Board -on any act~on to be
taken by the corporatlon w1th respect to the appo1ntment,
employment or dismissal of an employee shall be taken at a
meet1ng of the Board while such meet1ng lS open to the public.
Section 14. RIGHTS OF INSPECTION. Every Dlrector shall
have the absolute right at any reasonable time to inspect and
copy all books, records. and documents of every kind and to
inspec1_ the physical propertles of the corporation.
Section 15. FEES OF COMPENSATION. Dlrectors and members of
committees shall receive no compensation for their serV1ces as
such Dlrectors or members, but may receive such reimbursement for
expenses, as may be fixed or determlned by the Board.
ART I CLE VI
COMMITTEES
Section 1. COMMITTEES OF DIRECTORS. The Board of Dlrectors
may, by resolut1on adopted by a ma]Orlty of the D1rectors then in
offlce, deslgnate one or more comrnlttees, each consisting of two
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or mQre Directors, to serve at the pleasure of the Board. Any
committee, to the extent provlded in the resolutlon of the Board,
shall have all the authorlty of the Board, except that no
co~mittee, regardless of Board resolution, may:
(a) take any final action on matters which, under the
Nonprof~t Corporation Law of Callfornla, also requires members
approval;
(b)
committee;
f~ll vacancies on the Board of D~rectors or 1n any
(c) f1X compensatlon of the Directors for serving on
the Board or on any cornm1ttee;
(d) amend or repeal Bylaws or adopt new Bylaws;
(e) amend
Directors WhlCh by
repealable;
or repeal any resolution of the Board of
lts express terms lS not so amendable or
(f) appoint any committees of the Board of D1rectors or
the members of such cornrnltteeSj
(g) expend corporate funds to support a nominee for
Director after there are more people nom1nated for Director than
can be elected; and
(h) approve any transaction to WhlCh the corporat1on 1S
a party and 1n Wh1Ch one or more Directors have a mater1al
financlal lnterest.
Section 2. MEETINGS AND ACTION OF COMMITTEES. Meet1ngs and
action of comm1ttees shall be governed by, and held and taken 1n
accordance wlth, the provislons of these Bylaws, concernlng
meetings of Dlrectors, wlth such changes in context of those
Bylaws as are necessary to substitute the commlttee and 1ts
members for the Board of Dlrectors and its members, except that
the time for regular meetings of commlttees may be determlned
either by resolution of the Board of Directors or by resolutlon
of the committee. Speclal meetings of commlttees may also be
called by resolutlon of the Board of Directors. Notlce of
speclal meetings of comm1ttee shall also be glven to any and all
alternate members, who shall have the right to attend all
meetlngs of the commlttee. Mlnutes shall be kept of each meeting
of any commlttee and shall be flIed w1th the corporate records.
The Board of Directors may adopt rules for the government of any
committee not 1nconsistant wlth the provisions of these Bylaws.
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ARTICLE VII
OFFICERS
Section 1. OFFICERS. The officers of the corporat10n shall
be a Pres1dent a Secretary, and a ch1ef f1nanC1al officer. The
corporat10n may also have, at the discretion of the Board of
Directors, a Chairperson of the Board, one or more Vlce
Presldents, one or more assistant secretar1eS, one or more
assistant treasurers, and such other officers as may be appointed
1n accordance wlth the provlslons of Section 3 of this Article.
Any number of offices may be held by the same person, except that
nelther the Secretary nor the ch1ef financial officer may serve
concurrently as either the preSldent or the Chairperson of the
Board.
Sectlon 2. ELECTION OF OFFICERS The officers of the
corporation, except those appo1nted 1n accordance with the
prov1s10ns of Sectlon 3 of th1S Article, shall be chosen by the
Board of Dlrectors, and each shall serve at the pleasure of the
Board, subJect to the rights, if any, of an off1cer under any
contract of employment.
Section 3. SUBORDINATE OFFICERS. The Board of Dlrectors
may appolnt, and may authorize the Chalrperson of the Board or
the President or another officer to appoint, any other offlcers
that the business of the corporatlon may requlre, each of whom
shall have the tltle, hold offlce for the perlod, have the
authorlty, and perform the dutles specified ln the Bylaws or
determined from time to time by the Board of Directors.
Sectlon 4. REMOVAL OF OFFICERS. SubJect to the rlghts, if
any, of an officer under any contract of employment, any officer
may be removed, with or wlth cause, by the Board of Directors, at
any regular or special meet1ng of the Board, or, except in case
of an officer chosen by the Board of Directors, by an officer on
whom such power of removal may be conferred by the Board of
Dlrectors.
Sectlon 5. RESIGNATION OF OFFICERS. Any officer may resign
at any tlme by giving written notice to the corporatlon. Any
reslgn~t1on shall take effect at the date of the recelpt of that
not1ce or at any later time specified in that notlce: and, unless
otherwise spec1fied In that notlce, the acceptance of the
res1gnation shall not be necessary to make it effect1ve. Any
re51gnatlon 15 wlthout pre]Ud1Ce to the rlghts, lf any, of the
corporatlon under any contract to WhlCh the off1cer 1S a party.
Sect10n 6. VACANCIES IN OFFICES.
because of death, resignat1on, removal,
other cause shall be filled only In
these Bylaws for regular appo1ntments to
A vacancy in any office
d15quallf1cation, or any
the manner prescribed 1n
that off1ce.
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Section 7.
RESPONSIBILITIES OF OFFICERS.
(a) Chairperson of the Board. If such an off1cer be
elected, the Chairperson of the Board shall preside at meet1ngs
of the Board of Dlrectors and exerC1se and perform such other
powers and duties as may be from t1me to time ass1gned by the
Board of Directors or prescr1bed by the Bylaws. If there 15 no
President the Chairperson of the Board shall, 1n addit1on, be the
ch1ef executive offlcer of the corporation and shall have the
powers and dutles prescribed n paragraph (b), below.
(b) President. SubJect to such supervisory powers as
may be given by the Board of Directors to the Chairperson of the
Board, if any, the Pres1dent shall, subJect to the control of the
Board of D1rectors, generally superv1se, dlrect and control the
business and the officers of the corporat1on. The President
shall preside at all meet1ngs of the members and, in the absence
of the Cha1rperson of the Board, or 1f there be none, at all
meetings of the Board of Dlrectors. The Pres1dent shall have
such other powers and dutles as may be prescribed by the Board of
D1rectors or the Bylaws.
(c) Vlce Pres1dents. In the absence or disab111ty of
the President the V1ce Presldents, if any, 1n order of their rank
as f1xed by the Board of Directors or, 1f not ranked, a V1ce
President designated by the Board of Dlrectors, shall perform all
the dut1es of the President and when so acting shall have all the
powers of, and be subJect to all the restr1ctions upon, the
Pres1dent. The Vlce Presldents shall have such other powers and
perform such other duties as from time to time may be prescr1bed
for them respectively by the Board of Dlrectors or the
Chairperson of the Board.
(d) Secretary.
following:
The Secretary shall attend to the
(i) Book of Minutes. The Secretary shall
keep or cause to be kept, at the pr1ncipal execut1ve office
or such other place as the Board of Dlrectors may d1rect, a
book of minutes of all meetings and actlons of Directors and
comm1ttees of Directors, with the t1me and place of hold1ng,
whether regular or special, and, if spec1al, how author1zed,
the notlce given, the names of those present at such
meetlngs, and the proceedlngs of such meetlngs.
(11) Notlces, Seal and other Dutles. The
Secretary shall glve, or cause to be given, notice of all
meetings of the members and of the Board of Directors
required by the Bylaws to be glven, not1ce of all meetings
of the members and of the Board of Directors requlred by the
Bylaws to be g~ven. The Secretary shall keep the seal of
the corporation in safe custody. The Secretary shall have
such other powers and perform such other duties as may be
prescribed by the Board of Dlrectors or the Bylaws.
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(e) Chief F~nanClal Officer.
offlcer shall attend to the follow~ng:
The chief f~nancial
(i) Books of Account. The ch~ef financial
off~cer shall keep and maintaln, or cause to be kept and
malntained, adequate and correct books and records of
accounts of the propertles and buslness transactions of the
corporation, lncluding accounts of lts assets, llab1l1ties,
recelpts, dlsbursements, galns, losses, capital, retalned
earnlngs, and other matters customarily included 1n
financial statements. The books of account shall be open to
inspection by any Dlrector at all reasonable times.
(11) Deposit and d1sbursement of money and
valuables. The chLef financial offlcer shall deposlt all
money and other valuables in the name and to the credit of
the corporatlon with such deposltorles as may be des1gnated
by the Board of Dlrectors; shall d1sburse the funds of the
corporat1on as may be ordered by the Board of D1rectors~
shall render to the Pres1dent and Directors, whenever they
request it, an account of all of his transactions as chief
financial officer and of the financlal condition of the
corporat1on; and shall have other powers and perform such
other duties as may be prescribed by the Board of Dlrectors
or the Bylaws.
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ARTICLE VIII
TRANSACTIONS IN WHICH DIRECTORS
HAVE MATERIAL FINANCIAL INTEREST
Sectlon 1. PROHIBITION AGAINST SELF-DEALING TRANSACTIONS.
The corporation shall not enter lnto any transaction ln WhlCh one
or more of ltS Directors has a mater1al financial lnterest,
unless the transactlon meets the requ1rements of paragraph (a),
(b) or (c) of Section 2 of this Artlcle VIII. For purposes of
this Article VIII, a "self-deallng transaction" means a
transaction to which the corporation is a party and in which one
or more of its Dlrectors has a materlal financial lnterest. For
purposes of this Article VIII, such a Dlrector is referred to an
an "interested Dlrector." This sectlon shall not be construed to
prohlbit (a) a transactlon which 1S part of a publ1C or
charltable program of the corporation if It: (i) is approved or
authorized by the corporatlon in good faith and without
unjustlfled favoritism: and (li) results 10 a benefit to one or
more D1rectors or thelr faml1les because they are 1n the class of
persons intended to be benefited by the public or charltable
program: or (b) a transactlon, of which the lnterested Dlrector
or Directors have no actual knowledge, and WhlCh does not exceed
the lesser of 1 percent of the gross receipts of the corporation
for the preceding flscal year or one hundred thousand dollars
($100,000).
Section 2.
corporatlon shall
transact10n if:
PERMITTED SELF-DEALING TRANSACTIONS. The
be authorlzed to engage in a self-deallng
(a) The Ca11fornla Attorney General or the court 1n an
act10n in WhlCh the Callfornia Attorney General is an
lndispensable party, has approved the transaction before or
after lt was consummated; or
(b) The following facts are established:
(1) The corporation entered into the transactlon
for its own beneflt;
(li) The transact~on was falr and reasonable as
to the corporatlon at the tlme the corporation entered
lnto the transactlon;
(ill) Prior to consummating the transaction or any
part thereof, the Board authorlzed or approved the
transaction 1n good faith by a vote of a majority of
the Directors then In office wlthout countlng the vote
of the interested D1rector or Directors, and with
knowledge of the material facts concernlng the
transaction and the Dlrector's lnterest ln the
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transact1on. Except as provided in paragraph (c) of
this Sect10n 2, action by a commlttee of the Board
shall not satisfy thlS paragraph; and
(lV) (A) Pr10r to authorizing or approving the
transactlon the Board cons1dered and ln good fa1th
determlned after reasonable 1nvest1gatlon under the
circumstances that the corporation could not have
obtained a more advantageous arrangement with
reasonable effort under the circumstances;or
(B) The corporat1on ln fact could not have
obtained a more advantageous arrangement with
reasonable effort under the clrcumstances; or
(c) The following facts are established:
(1) A committee or person authorized by the
Board approved the transaction in a manner consistent
with the standards set forth 1n paragraph (b) of this
Sectlon 2;
(11) It was not reasonably practlcable to
obtain approval of the Board prior to enterlng lnto the
transaction; and
(iil) The Board, after determlning in good falth
that the condltions of subparagraphs (i) and (ii) of
this paragraph were satisfled, ratified the transactlon
at 1t next meetlng by a vote of the majority of the
Dlrectors then In offlce without count1ng the vote of
the lnterested Dlrector or Dlrectors.
Section 3. PROHIBITED LOANS AND GUARANTEES. The
corporatlon shall not make any loan of money or property to or
guarantee the obligation of any D1rector or officer, unless
approved by the Californ1a Attorney General, except that:
(a) The corporatlon may advance money to a Dlrector or
off1cer of the corporat1on for expenses reasonably
anticipated to be 1ncurred 1n the performance of the dut1es
of such officer or Director, provided that 1n the absence of
such advance, such Director or off1cer would be ent1tled to
be reimbursed for such expenses by the corporat1on; and
(b) The corporat1on may pay premiums In whole or 1n
part on a 11fe 1nsurance policy on the llfe of the Director
or offlcer so long as repayment to the corporation of the
atlount paid by it is secured by the proceeds of the POllCY
and ltS cash surrender value.
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ARTICLE IX
REPORTS, RECORDS AND RIGHTS OF INSPECTION
Sectlon 1. ANNUAL REPORT. Wlthin nlnety (90) days after
the close of the corporatlon's flscal year, the Board shall cause
an annual report of its operations to be provided to the City
Councll. Such report shall contain, in appropriate detail, the
followlng:
(a) The assets and llabllltles, including the trust
funds, of the corporation as of the end of the flscal year.
(b) The prlnclpal changes 1n assets and liabilities,
lncluding trust funds, during the fiscal year.
(c) The
unrestrlcted
fiscal year.
revenue or recelpts of the corporation, both
and restricted to particular purposes, for the
(d) The expenses or d1sbursements of the corporation,
for both general and restricted purposes, durlng the flscal
year.
(e) Any lnformatlon required by Sectlon 5322 of the
California Nonproflt PubllC Beneflt Corporatlon Law
(pertainlng to certaln transactions and lndemnifications
lnvolving interested persons).
(f) A narrative description of the corporatlon's
principal actlvltles during the fiscal year.
(g) Such other lnforrnation concernlng the corporatlon
as may be requested by the Clty Councll 1n writing not less
than nlnety (90) days preceding the end of such flseal year.
Sectlon 2. RECORDS AND RIGHTS OF INSPECTION. The
corporation shall keep adequate and correct books and records of
account and mlnutes of the proceedlngs of lts Board and
comrnlttees of the Board. Mlnutes shall be kept in wrltten form.
Other books and records shall be kept e1ther 1n wrltten form or
in any form capable of being converted lnto written form. The
books and records of the corporation shall be open to lnspection
and copying by members of the public to the same extent as the
public records of the Clty of Santa Monica.
Sectlon 3. FISCAL YEAR AND ANNUAL REPORT. The
corporatlon's flscal year shall close on June 30. The
corporation shall prov1de to the Directors wlthln 120 days after
the close of lts flseal year, a report containing the followlng
information ln reasonable detall:
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(a) The assets and liabilities, including the trust
funds, of the corporation as of the end of the fiscal year~
(b) The principal changes ~n assets and l~ab~l~t~es,
includ~ng trust funds, durlng the f~scal year~
(c) The
unrestricted
f~scal year~
revenue or rece~pts of the corporation, both
and restr~cted to particular purposes, for the
(d) the expenses or disbursements of the corporation,
for both general and restr~cted purposes, during the flscal
year.
ARTICLE X
INDEMNIFICATION
Section 1. STATUTORY INDEMNITY.
~ndemnify its D~rectors, off~cers and
extent permitted of the Callfornia
Corporatlon Law.
ThlS corporatlon shall
employees to the fullest
Nonprofit Public Benefit
Section 2. NONAPPLICABILITY OF FIDUCIARIES OF EMPLOYEE
BENEFIT PLANS. ThlS Article X does not apply to any proceeding
agalnst any trustee, investment manager, or other fiduciary of an
employee benefit plan in such person's capacity as such, even
though such person may also be an agent of the corporation as
deflned in Section 1 of this Article X. The corporatlon shall
have power to indemnify such trustee, invest~ent manager, or
other fiduciary to the extent permltted by subdivision (f) of
Sectlon 207 of the California General Corporation Law.
ARTICLE XI
OTHER PROVISIONS
Sectlon 1. ENDORSEMENT OF DOCUMENTS~ CONTRACTS. SubJect to
the provisions of applicable law and these Bylaws, any note,
mortgage, eVldence of lndebtedness, contract, conveyance, or
other lnstrument in writing and any asslgnment or endorsement
thereof executed or entered lnto between the corporatlon and any
other person, when slgned by (a) the Executive Director, or
(b)(l) the Chair of the Board or any Vlce-Chalr and (b)(ii) the
Secretary, any Assistant Secretary, the Chlef Financial Offlcer,
or any Asslstant Treasurer of the corporation shall be valid and
bindlng on the corporatlon ln the absence of actual knowledge on
the part of the other person that the slgning offlcers had no
authorlty to execute the same. Any such instruments may be
signe0 by any other person or persons ln such manner as from t~me
to time shall be determ1ned by the Board, and, unless so
authorized by the Board, no offlcer, agent, or employee shall
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have any power or author~ty to
contract or engagement or to pledge
liable for any purpose or amount.
bind the corporation by any
its credlt or to render lts
Sectlon 2. REPRESENTATION OF SHARES OF OTHER CORPORATIONS.
The Chair of the Board or any other offlcer or offlcers
authorized by the Board or the Chalr of the Board are each
authorlzed to vote, represent, and exerClse on behalf of the
corporation all rights incldent to any and all shares of any
other corporatlon or corporations standing In the name of the
corporatlon. The authorlty herein granted may be exerclsed
elther by any such officer ln person or by any other persons
authorlzed so to do by proxy or power of attorney duly executed
by sald officer.
Sectlon 3. CONSTRUCTION AND DEFINITIONS. Unless the
context otherWlse requlres, the general provlslons, rules of
contruction, and deflnltlons contalned 1n the General ProvislonS
of the Callfornia Nonproflt Corporation Law and in the Callfornia
Nonprofit Public Benefit Corporation Law shall govern the
constructlon of these Bylaws.
Section 4. AMENDMENTS. New Bylaws may be adopted or these
Bylaws may be amended or repealed by approval of the Board of
Dlrectors, and the Santa Monlca Arts Commission, effective only
upon the written notlficatlon to the Corporatlon by the Santa
Monica City Clerk of approval by the Santa Monlca City Councll.
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CERTIFICATE OF SECRETARY
I, the undersigned, hereby certlfy:
1. That I am the duly elected, qual1fled and acting
Secretary of the Santa Monlca Arts Foundatlon, Inc., a California
nonprofit corporat~on; and
2.
duly adopted
Dlrectors of
that the same
That the foregoing Bylaws of said corporation were
as the Bylaws thereof by wrltten consent of the
said corporat~on on , 1984, and
do now const~tute the Bylaws of said corporation.
Executed this
day of
1984.
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