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Notes on the Changes in the December 20 Draft

Notes on the Changes in the December 20 Draft

Bob Gaines reviewed Marguerite Kearns' notes taken at the November 15 business meeting and made several changes to address the three primary concerns expressed at that meeting:

*Relationship of business meeting and corporation in articles 2, 6, and 11
*Attenders as members of corporation in article 3
*Officers in article 7

Ken Winston Caine reviewed the changes Bob made, and Ken added a change making clear that in addition to buying and selling property the directors can also receive gifts of property on behalf of the meeting (this is one of the functions of the trustees of the title-holding trust which would be turned over to the directors of the corporation when the trust is dissolved).

The Corporations Bureau of the New Mexico Public Regulation Commission oversees non-profit corporations.  Roy E. Stephenson, who is the Director of the Utility Division of the PRC, kindly agreed to look over our draft, even though he is not directly responsible for corporations.  He had only one question: whether the appointment process was sufficiently defined in this sentence "Each Director shall be appointed by the Monthly Meeting according to its usual appointment process for staggered three year terms."

Details of the Changes:

Relationship of business meeting and corporation - The concern expressed in the November 15 business meeting was that the statement of purpose of the November 3 draft appeared to have the corporation supplanting the business meeting:

"The purpose of the corporation is to provide facilities for worship and related activities of the Monthly Meeting, and to hold, maintain, and dispose of property thus used." (November 3 draft)

The December 20 draft's revised statement of purpose emphasizes that the corporation is simply the servant of the business meeting, and article 6 and especially article 11 were changed to reflect that fact.



Relationship of business meeting and corporation - The concern expressed in the November 15 business meeting was that the statement of purpose of the November 3 draft appeared to have the corporation supplanting the business meeting:

"The purpose of the corporation is to provide facilities for worship and related activities of the Monthly Meeting, and to hold, maintain, and dispose of property thus used." (November 3 draft)

The December 20 draft's revised statement of purpose emphasizes that the corporation is simply the servant of the business meeting, and article 6 and especially article 11 were changed to reflect that fact.



Relationship of business meeting and corporation - The concern expressed in the November 15 business meeting was that the statement of purpose of the November 3 draft appeared to have the corporation supplanting the business meeting:

"The purpose of the corporation is to provide facilities for worship and related activities of the Monthly Meeting, and to hold, maintain, and dispose of property thus used." (November 3 draft)

The December 20 draft's revised statement of purpose emphasizes that the corporation is simply the servant of the business meeting, and article 6 and especially article 11 were changed to reflect that fact. 

After some discussion of how extensive the revised purpose of the corporation should be, Ken and Bob agreed to offer two alternatives, leaving it to the business meeting to decide whether the purpose should be focused primarily on the role of the corporation in dealing with property or whether it should allow a somewhat broader role for the corporation:

"The purpose of the Corporation is to serve the needs of the Monthly Meeting, including receiving, holding and disposing of property used by the Monthly Meeting for worship and related activities.

    OR

"The purpose of the Corporation is to serve the needs of the Monthly Meeting for worship and related activities, including receiving, holding and disposing of property."


Attenders as members of corporation - The November 15 business meeting favored allowing attenders to become members of the corporation.  The revised version of article 3 clarifies that attenders will register with the corporation secretary to become members of the corporation but leaves it to the business meeting to decide whether attenders would be able to register prior to any meeting of the corporation or only before the annual meeting in February.


Officers - The main concerns about officers in the November 3 draft were 1) why couldn't the corporation directors and officers just be the same as the officers of the meeting, and 2) whether there would be confusion between the roles of the corporation treasurer and the meeting treasurer.

The November 3 draft didn't require the meeting officers to be the corporation officers because the original drafting committee felt that it might be too burdensome for the meeting officers.  They also felt that using the same titles for the meeting and corporation officers might be confusing.  However, the November 3 draft wouldn't prevent the persons who were the officers of the meeting from being designated the officers of the corporation, if that's what the business meeting wanted and the meeting officers agreed.   Since the November 3 draft actually allowed the business meeting complete flexibility in deciding who should be directors and officers,  no change was needed in the December 20 draft to address that concern.

Regarding the concern about confusion between the roles of the corporation treasurer and the meeting treasurer, the November 3 draft proposed three officers, one being a treasurer.  The state law only requires that we have two: an officer "to record the proceedings of the meetings" (which typically is the secretary) and "as many officers as may be necessary to enable the corporation to sign instruments required" by the statute, which turns out to be only the two needed to sign the reporting forms (see references below).

There is no requirement by the state to have a corporate treasurer, and no need by the business meeting to have a second treasurer, so the treasurer has been omitted in the December 20 draft.

The reporting forms don't require us to use any specific titles, but the annual reporting form does ask which officers have the functions of president and secretary, so it is convenient to retain those titles for the two officers in the December 20 draft.

Bob Gaines
Clerk

*************

References for Officers:

The statute:

53-8-23. Officers.

A.     Every corporation organized under the Nonprofit Corporation Act [Chapter 53, Article 8 NMSA 1978] shall have officers, with titles and duties as shall be stated in the bylaws or in a resolution of the board of directors which is not inconsistent with the bylaws, and as many officers as may be necessary to enable the corporation to sign instruments required under the Nonprofit Corporation Act. One of the officers shall have the duty to record the proceedings of the meetings of the members and directors in a book to be kept for that purpose.  In the absence of any provision, all officers shall be elected or appointed annually by the board of directors.  If the bylaws so provide, any two or more offices may be held by the same person.  

B.     The articles of incorporation or the bylaws may provide that any one or more officers of the corporation shall be ex officio members of the board of directors.  

C.     The officers of a corporation may be designated by such additional titles as may be provided in the articles of incorporation or the bylaws.  

The annual report form:

6.      Indicate the names and respective addresses of the directors and officers of the corporation. You are not  required to indicate who is the President, Vice President, Secretary and Treasurer, but you are required to have  officers and you must indicate officers whose duties most closely correspond to the requirements of NMSA 1978 Section 53-8-23. If the corporation’s articles of incorporation or by-laws confer additional titles on the  officers, you may provide these in the right column, but this is not required.

7.      Any two of the directors or officers of the corporation, or a receiver or trustee if the corporation is in the hands of a receiver or trustee, must sign and swear to the statements in the report.

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