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Articles of Incorporation of the National Fastener Distributors Association  (Illinois Corporation Not for Profit)

FIRST: The name of this corporation shall be: NATIONAL FASTENER DISTRIBUTORS ASSOCIATION

SECOND: The place where the principal office of the Association is to be located is: 401 N. Michigan Ave., Ste. 2200 Chicago , IL 60611

THIRD: The purpose or purposes for which this Association is formed shall be, in all ways which are lawful and consistent with the public interest, as follows: 

  1. To advance the interests of the fastener industry by promoting the distribution of fasteners through persons engaged in the industry;
  2. To collect and disseminate useful statistics and information for members;
  3. To encourage enlarged and more friendly relationships and to promote and preserve a strong, healthy market between persons engaged in the fastener industry;
  4. To formulate strong relationships with manufacturer-suppliers so as to foster improvement in the service rendered by the fastener industry to consumers;
  5. To promote improvement of quality in the expansion of markets for fasteners;
  6. To develop new uses for fasteners and to search for new or improved devices that will broaden and/or in crease the performance of fastening systems;
  7. To assist in the maintenance of sound and equitable relationships between the industry and its employees, its customers, the general public and the Federal Government.

FOURTH: The Association shall consist of three (3) classes of members as follows:

  1. Distributor Members who shall be such corporations or partnerships engaged in or individuals engaged for their own account in The business of distributing ferrous, non-ferrous, non-metallic and stainless steel fastener products and regularly maintaining and using a warehouse or other distribution facility for the storage of said products pending distribution, with the necessary facilities for the fastener products inventory and personnel for the operation thereof where such business constitutes the members principal business or otherwise meets the requirements for membership as set forth in the By-Laws;
  2. Associate Members who shall be such corporations and partnerships engaged in and individuals engaged for their own account in the manufacturing or finishing of fasteners or in the distribution of fasteners to re-sellers and fastener manufacturers and such corporations, partnerships and individuals whose principal business is to provide products, materials and services to persons engaged in the fastener industry, as shall be admitted to membership pursuant to the By-Laws; and
  3. Lifetime Members who shall be persons that have advanced the interests of the fastener industry and of the Association. Lifetime Members shall be elected in the manner provided in the By-Laws. Provided that: the number of Distributor Members shall always be greater than the number of Associate Members. Distributor and Associate Members shall be entitled to voting rights as provided in the By-Laws. Lifetime Members shall not be entitled to vote.

FIFTH: The Association shall be managed and controlled by a Board of Directors in the manner and subject to the provisions of these Articles of Incorporation and the By-Laws of the Association.

SIXTH: The officers of this Association shall consist of a Chairman and/or a President who may also serve as Chair man of the Board, one or more Vice Presidents, a Secretary, a Treasurer (or, in lieu of a Secretary and a Treasurer, a Secretary-Treasurer) and such other officers with such powers and duties as shall be provided in the By-Laws.

SEVENTH: The Annual Meeting of the Members of the Association shall be held on a date set in accordance with the By-Laws; and other meetings may be held at such time and such manners as may be provided in the By-Laws.

EIGHTH: Each member shall pay dues as are provided in the By-Laws.

NINTH: All rules for the management and conduct of the affairs of the Association not inconsistent here with shall be fixed and determined by the By-Laws.

TENTH: The By-Laws may be amended (a) by an affirmative vote of 2/3 of the Directors at any meeting at which a quorum, as fixed by the By-Laws, is present, or (b) by any Annual Meeting or at any special meeting by the vote of a majority of the Members of the Association present in person or by proxy, provided that a quorum, as fixed by the By-Laws, shall be present.

ELEVENTH: These Articles of Incorporation may be amended at any Annual Meeting or at any special meeting called for that purpose by the vote of a majority of the Members of the Association present in person or by proxy, provided that a quorum, as fixed by the By-Laws, shall be present.

TWELFTH: Upon the dissolution of this corporation, the Board of Directors shall, after paying or making pro vision for the payment of all of the liabilities of the corporation, dispose of all of the assets of the corporation by making distribution for the purposes set forth in Article Third hereof in such manner as the Board of Directors shall then determine. Any assets not so disposed of shall be disposed of by order of a court in the county in which the principal office of the corporation is then located which has jurisdiction with respect to such matters, either by direct disposition for exclusively charitable or educational purposes, or by disposition to such organizations, as the court shall then determine, which are organized and operated exclusively for charitable or educational purposes and which at that time qualify as exempt public 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). 

Amended Bylaws (June 2004)  

ARTICLE l
MEMBERSHIP

Section 1. Classes. There shall be three classes of members: Distributor Members, Associate Members and Lifetime Members.

Section 2. Application. Application for membership in this Association shall be made to the Secretary in writing, on the required form, as established by the Association. All applications for Distributor and Associate member ship must be made in writing, signed by the applicant, and shall state the class of membership applied for and be addressed to the Secretary. An applicant shall become a member of this Association upon the vote of a majority of the Directors at a meeting which a quorum is present or upon written approval of such application signed by a majority of the Directors and upon payment of the applicable dues and fees. Lifetime Members shall be elected at any meeting of the Board of Directors at which a quorum is present upon submission of a letter of recommendation for Lifetime Membership from any member in good standing.

Section 3. Certificate of Membership. There shall be furnished by the Secretary to each member who shall have paid its dues a certificate of membership signed by the Secretary or an Assistant Secretary.

Section 4. Resignation. Resignations of members shall be submitted in writing to the Secretary. A resignation shall not be retroactively effective but shall be effective on the date of its acceptance by the Board of Directors. All dues or fees which were due on the date on which the resignation becomes effective shall be payable to the Association. Any member resigning from the Association shall have no further interest in the property of, or claim against, the Association.

Section 5. Membership Eligibility Statement. If requested at any time after election to membership, a member agrees to submit to the Secretary such statements as may be determined necessary to support continuing membership eligibility.

ARTICLE II
QUALIFICATIONS FOR MEMBERSHIP

Section 1. Distributor Members. To qualify as a Distributor Member of the Association, the corporation, partnership, or individual must be reputable and actively engaged in the distribution of fasteners as defined in ARTICLE FOURTH of the Articles of Incorporation. An applicant for Distributor Membership must demonstrate that it is engaged in the distribution of fasteners as stated in the Articles of Incorporation and meets the qualifications/requirements for membership as established by the Board of Directors. Any Distributor qualification/requirement for membership, except as stated in the Articles of Incorporation, may be waived and/or changed by a majority vote of the members of the Board of Directors.

Section 2. Associate Members. An Associate Member may be a corporation, partnership, or individual and must be a reputable manufacturer of fasteners, fastening devices or related products, a distributor of fasteners selling primarily to fastener distributors, or a corporation, partnership or individual whose principal business is to provide products, materials or services to persons engaged in the fastener industry who are capable of making substantial contributions to the objectives of the Association as stated in the Articles of Incorporation and meets the qualifications/requirements for membership as established by the Board of Directors. Any Associate qualification/requirement for membership, except as stated in the Articles of Incorporation, may be waived and/or changed by a majority vote of the members of the Board of Directors.

Section 3. Lifetime Members. Lifetime Members are persons that have significantly advanced the interests of the fastener industry and the Association, and are no longer actively working in the industry.

ARTICLE III
SUSPENSION OR EXPULSION FROM MEMBERSHIP

Section 1. Reasons for Suspension or Expulsion. Any Distributor Member, Associate Member, or Lifetime Member may be suspended or expelled from membership for any of the following reasons:

a. Failure to conform with the provisions of the Articles and By-Laws of this Association.
b. For any conduct unbecoming a member in this Association or calculated to bring this Association into disrepute.
c. Failure to continue to meet membership eligibility requirements. Section

2. Suspension or Expulsion for Cause. Upon being advised that an event has happened which could constitute ground for suspension or expulsion of any member from the NFDA under Section 1 of this Article, the Secretary shall investigate with the com plain ant and member involved and report fully to the Board of Directors who will determine the outcome of the complaint. Any member may be suspended or expelled for cause by a 2/3 vote of the Directors. Notice of the proposed suspension or expulsion shall be given by certified mail to the member at least 30 days prior to the meeting at which such action is to be considered. Such member shall have the right to appear and present a defense.

Section 3. Suspension or Expulsion for Failure to Pay Dues. In addition to the reasons specified in Section 1 of this Article, any member may be suspended or expelled from membership, by the President, in his discretion, two weeks after the member has been given notice by the Secretary, of the proposed suspension or expulsion, for failure to pay dues within sixty (60) days after the payment thereof shall be due.

Section 4. Suspended and Expelled Members. Any member suspended or expelled from the Association under this Article shall have no further interest in the property of, or claim against, the Association.

Section 5. Reinstatement. Resigned and/or terminated members may, in the discretion of the Board of Directors, be re in stated.

ARTICLE IV
MEETINGS AND QUORUMS

Section 1. Annual Meeting. An Annual Meeting of the members of the Association shall be held at such place, within or without the State of Ohio, and on such date, as may be designated by the Board of Directors, for the purpose of presenting to the members the annual report and for the transaction of such other business as may be brought before the meeting. Notice of each Annual Meeting shall be given by the Secretary to each member at least thirty (30) days prior to the meeting by delivering such notice to such member personally or mailing the same to the member at the address which appears on the books of the Association. Any irregularity in such notice shall not affect the validity of any Annual Meeting or of any proceedings at such meeting.

Section 2. Special Meetings. Special meetings may be called at any time by the Chairman of the Board of Directors, by the President of the Association or, in case of the President’s absence, death, or disability, the Vice President authorized to exercise the authority of the President, by the Directors by action at a meeting, by a majority of the Directors acting in writing without a meeting, or by the lesser of (a) ten percent (10%) of the Members or (b) twenty-five (25) Members, and special meetings so called shall be held not more than sixty (60) days after the receipt by the Secretary of such call, and at the time and place designated by the Chairman of the Board of Directors or the President of the Association or, if they shall for any reason fail to make such designation within thirty (30) days after the receipt by the Secretary of such call, at the time and place designated by the Secretary. Notice of each special meeting, indicating briefly the objects thereof, shall be given by the Secretary to each member entitled to vote at such meeting by mailing such notice to him at the address which appears on the books of the Association at least (10) days prior to the meeting.

Section 3. Quorum and Proxies. At any meeting of the members a majority of all members entitled to vote at such meeting, present in person or represented by proxy, shall constitute a quorum for all purposes, unless the presence of a larger number shall be required by law, and in that case the presence of the number so required shall constitute a quorum. A member who is not personally present may be represented and vote by written proxy. Proxies to be recognized must be delivered to the Secretary prior to the opening of the meeting at which they are voted. If the members necessary to constitute a quorum shall fail to attend in person or by proxy at the time and place fixed, as above provided, a majority of the members entitled to vote at such meeting, present in person or by proxy, may adjourn the meeting from time to time, without notice other than by announcement at the meeting, until the number of members requisite to constitute a quorum shall attend. At any such adjourned meeting at which a quorum shall be present any business may be transacted which might have been transacted at the meeting if it had been held as originally called. Each Member shall be entitled to one vote at all meetings of members on all matters. Lifetime Members shall not be entitled to vote. A Member may vote in person or by proxy appointed by instrument in writing, subscribed by such member or by his duly authorized attorney and delivered to the inspectors at the meeting. Such instrument may contain specific instructions as to the manner in which such vote shall be cast, and no vote cast by such proxy, contrary to any such instructions, shall be valid. Upon demand of any Member, the vote upon a question coming before the meeting shall be by ballot, but unless the demand be made, the vote may be taken in any way approved at such meeting.

Section 4. Organization. The President, and in his or her absence, any Vice President, shall call meetings of the members to order and shall act as Chairman of such meetings. In the absence of the President and any Vice President, the members present may elect a Chairman by a majority vote. The Secretary shall act as secretary at all meetings of the members; but in the absence of the Secretary at any meeting of the members, the presiding officer may appoint a person to act as secretary of the meeting.

Section 5. Order of Business. The order of business at all meetings of the members shall be as follows: 

a. Call to order
b. Roll call.
c. Welcoming of new members and visitors.
d. Reading minutes of previous meeting, or waiver thereof.
e. Reports of officers and Board of Directors.
f. Reports of committees.
g. Unfinished business.
h. New Business.
i. Adjournment

Section 6. Minutes. At all meetings of the members of the Association, a record of the proceedings shall be preserved as the minutes of the meeting.

ARTICLE V
THE BOARD OF DIRECTORS

Section 1. Duties. The business and affairs of the Association shall be managed and controlled by the Board of Directors, and subject to any restriction imposed by law, by the Articles of Incorporation, or by these By-Laws, the Board of Directors of the Association may exercise all the powers of the Association.

Section 2. Number, Election, and Term of Office. The Board of Directors shall consist of twelve Members, who shall be nine Distributor members and three Associate members. Three Distributor members and one Associate member shall be elected each year to serve a term of three years. The Chairman of the Board of Directors shall be elected as provided in Section 9 of this Article. No Director elected for a term of three years shall be elected to succeed himself or herself. At each Annual Meeting of Members, the members entitled to vote and present either in person or by proxy shall elect successors to the Directors whose terms expire in that year, such successor Directors to serve three year terms and until their successors are duly elected and qualified. The existing Board of Directors cannot amend these By-Laws to perpetuate their terms of office.

Section 3. Place of Meeting, etc. The Directors may hold their meetings and may have an office and keep the books of the Association (except as otherwise may be provided for by law) in such place or places as the Board of Directors from time to time may determine. 

Section 4. Regular Meetings. A regular meeting of the Board of Directors shall be held as a part of and during the Annual Meeting of the Distributor Members of the Association at which a quorum is present. Other regular meetings of the Board of Directors may be held at such stated times and at such places as from time to time may be prescribed by resolution of the Board of Directors. No notice of regular meetings shall be required.

Section 5. Special Meetings. Special meetings of the Board of Directors shall be held whenever called by direction of the Chairman of the Board of Directors or one-third (1/3) of the Directors. The Secretary shall give notice of each special meeting by mailing the same at least one week before the meeting, or by faxing or by telephoning said notice at least three (3) days before the meeting, to each Director; but such notice may be waived by any such Director.

Section 6. Telephonic Meetings. The Directors may hold their meetings through any communication equipment if all per sons participating can hear each other. Participation in a meeting pursuant to this section shall constitute presence at such meeting for all purposes.

Section 7. Quorum. A majority of all the Directors, unless otherwise specified in the By-Laws, shall constitute a quorum for the transaction of business; but if at any meeting of the Directors there be less than a quorum present, a majority of those present may adjourn the meeting from time to time.

Section 8. Order of Business. At meetings of the Board of Directors business shall be transacted in such order as from time to time the Board of Directors may determine by resolution.

Section 9. Election of Officers. At the Annual Meeting of the Board of Directors held during the Annual Meeting of the members of the Association as provided in Article IV, the existing Board of Directors shall proceed to the election of the officers by a written ballot. The Vice President-President Elect shall be elected President for the following year.

Election of Vice President-President Elect. All three Directors who are Distributor Members, and who have served one full year will automatically be considered to be nominated for the office of Vice President-President Elect. These Directors (unless any of them chooses to decline the nomination) shall be excused from the Board meeting, at which time there will be an open discussion as to the relative qualifications of the candidates, bearing in mind that the Vice President elected will be elected for the office of President for the following year. Upon motion duly passed after sufficient discussion has been held, the nominees will return to the meeting, and thereupon a vote by all Directors present shall be held by a written ballot to elect the Vice President-President Elect for the following year. In case of a tie, additional ballots shall be conducted until a candidate is elected. If more than two candidates are voted for, the candidate receiving a plurality shall be elected. After the election of the officers, the existing Board of Directors shall be adjourned, and the successor Board of Directors convened and proceed to the business and affairs of the Association.

Section 10. Annual Report. At each Annual Meeting, the Board of Directors shall present a report, verified by the President and Treasurer, or by a majority of the Directors showing the whole amount of real and personal property owned by the Association, where located and where and how invested, the amount and nature of the property acquired during the year immediately preceding the date of the report and the manner of the acquisition, the amount applied, appropriated or expended during the year immediately preceding such date and the purposes, objects or persons to or for which such applications, appropriations or expenditures have been made, and the names and places of residence of the persons who have been admitted to membership in the Association during such year. An annual audit or review of the financial books and records of the Association shall be prepared by affirm of independent, certified public accountants appointed by the Board of Directors and shall be included in the annual report required by this section. Such report shall be filed with the records of the Association and an abstract thereof entered in the minutes of the proceedings of the Annual Meeting.

Section 11. Vacancies. If at any time, through resignation or other causes, a vacancy on the Board of Directors should occur, it may be filled for the balance of the remaining term by the affirmative vote of a majority of the remaining Directors.

Section 12. Qualification of Directors. The Board of Directors shall be the final judge of the qualification of Directors. In the event a Director leaves the fastener industry he was representing, he or she will no longer be qualified to serve as a Director of the association.

Section 13. Meeting Minutes. At all meetings of the Board of Directors, a record of the proceedings shall be preserved as the minutes of the meeting.

ARTICLE VI
OFFICERS

Section 1. Officers. The officers of this Association shall consist of a Chairman and/or a President who may also serve as Chairman of the Board, an Executive Vice President, one or more Vice Presidents, one of whom shall be designated President Elect, a Secretary and a Treasurer, all of whom shall be elected by the Board of Directors. The Chairman of the Board of Directors, the President, each Vice President and the Treasurer shall be Directors. The Executive Vice President and the Secretary may but need not be Directors. The offices of Secretary and Treasurer may be held by the same person and in that case the office shall be called the Secretary-Treasurer and he or she may but need not be a Director or member of the Association. The Chairman of the Board of Directors, the President or Vice President may also hold the office of either Secretary or Treasurer. The Board of Directors may appoint such other officers as it shall deem necessary, who shall have such authority and shall perform such duties as from time to time may be rescribed by the Board of Directors. In the absence of any officer of the Association, the Board of Directors may delegate his or her powers or duties to any other officer or to any member of the Board of Directors. All officers (except the Executive Vice President and the Secretary) shall be chosen from the Distributor Members of the Association. Any officer, agent or employee shall be subject to removal at any time by the affirmative vote of the Directors in office, except as may be otherwise provided in a written contract approved by the Board of Directors at a regular meeting at which a quorum is present. All officers, agents and employees, other than officers appointed by the Board of Directors, shall hold office at the discretion of the officer appointing them. The Board of Directors may deny access to others the reports, data or statistics of any nature, whatsoever, submitted to the Association by any individual member to the extent permitted by law.

Section 2. The Chairman of the Board of Directors. The Chairman of the Board of Directors shall be the Chief Executive Officer of the Association and shall preside at all meetings of the members and of the Board of Directors. He or she shall have general charge of keeping the officers of the Association apprised of the Association’s policies. He or she shall have such additional duties as may be assigned to him or her by the Board of Directors. He or she shall be ex officio a member of all standing committees.

Section 3. Executive Vice President. The Executive Vice President shall be the chief administrative officer of the Association and shall be ex officio a member of all standing committees. Subject to the Board of Directors, he or she shall have general charge and supervision over the administrative affairs of the Association. He or she shall keep the Chairman of the Board of Directors fully informed and shall freely consult with him concerning the business and affairs of the Association in his or her charge and shall perform such other duties as may from time to time be assigned to him or her by the Board of Directors.

Section 4. Vice Presidents. Each Vice President, in the order from time to time designated by the Board of Directors, shall, except as otherwise provided in these By-Laws, be vested with all the powers and required to perform all the duties of the President in the President’s absence; and at other times each Vice President shall have such powers and perform such duties as may be assigned to him or her by the Board of Directors.

Section 5. Treasurer. The Treasurer may execute and deliver all authorized bonds, notes, checks, contracts, agreements or other obligations or instruments in the name of the Association and he or she shall have custody of all the funds and securities of the Association which may have come into his or her hands; when necessary or proper he or she shall endorse on behalf of the Association for collection checks, notes and other obligation,, and shall deposit the same to the credit of the Association in such bank or banks or depository as the Board of Directors may designate. Unless otherwise ordered by the Board of Directors, he or she shall sign all receipts and vouchers for payments made to the Association and shall sign all checks made by the Association, and shall pay out and dispose of the same. He or she shall enter regularly, in books of the Association to be kept by him or her for the purpose, full and accurate account of all monies received and paid by him or her on account of the Association. He or she shall submit a detailed statement of his or her cash account at each Annual Meeting of the Association, showing the financial transactions for the preceding fiscal year and shall furnish to the President and the Board of Directors from time to time, as required by them, such information relative to the funds of the Association as may be required. He or she shall prepare and submit to the Board of Directors for their approval the report required by Section 10 of Article V of these By-Laws and he or she shall perform all acts incident to the position of Treasurer, subject to the control of the Board of Directors. The Board of Directors may by resolution transfer to and vest in the President, for such time as the Board of Directors shall determine, any or all powers, duties and functions herein vested in the Treasurer and may prescribe that such powers, duties and functions herein vested in the Treasurer shall be exercised either exclusively by the President or concurrently by him or her with the Treasurer in such manner as the Board of Directors may order. Anything in this Section to the contrary notwithstanding, each check, draft or other instrument for withdrawal of funds of the Association in excess of $15,000 shall be signed by the Treasurer and any one of the following who is not at the same time holding the office of Treasurer: The Chairman of the Board or the President or any Vice President; but in the amount of $15,000 or less, any check, draft or other instrument for withdrawal of funds of the Association may be signed by any one of the officers mentioned in this paragraph.

Section 6. Secretary. The Secretary shall keep the minutes of all meetings of the Board of Directors and all meetings of the members of the Association in books provided for that purpose. He or she shall keep a roll of the members of the Association and shall attend to the giving and serving of all notices of the Association. He or she may sign in the name of the Association, all contracts authorized by the Board of Directors, and, when so ordered by the Board of Directors, he or she shall affix the seal of the Association thereto. He or she shall have charge of such books and papers as the Board of Directors may direct. He or she may sign all certificates of membership in the Association and he or she shall in general perform all the duties incident to the office of Secretary, subject to the control of the Board of Directors. The Secretary may, but need not, be a member of the Association.

Section 7. Corporate Seal. The Board of Directors shall provide a suitable seal, containing the name of the Association, which seal shall be in the custody of the Secretary. When so directed by the Board of Directors, a duplicate of the seal may be kept and be used by the Treasurer or by any Assistant Secretary or Assistant Treasurer.

ARTICLE VII
REPRESENTATIVES OF MEMBERS

Section 1. Representatives of Members. Whenever membership is held in the name of a corporation, partnership, or firm, one regular individual, certified in writing by a responsible official of the Member concerned shall be named to represent the firm to the Association, shall exercise the voting power of the Member, if any, and his or her name shall be certified to the Secretary of the Association together with an alternative.

Section 2. Change of Representative. A Member of the Association may change from time to time its representative or alternative by notifying the Secretary of such change in accordance with the provisions of the preceding section.

ARTICLE VIII
AUTHORITY TO OBLIGATE ASSOCIATION

 No agreement, contract, obligation or check involving the payment of money, or the credit or liability of the Association, for more than Five Thousand Dollars ($5000) shall be made without the approval of the Board of Directors.

ARTICLE IX
DUES

Section 1. Distributor Members. Annual dues for Distributor Members shall be such amount established by the Board of Directors, and said annual dues shall be paid on a calendar year basis. Each new Distributor Member shall, upon acceptance for membership, pay an initiation fee in an amount established by the Board of Directors. Annual dues shall be due from new Distributor Members on a pro rata basis from date of acceptance.

Section 2. Associate Members. Annual dues for Associate Members shall be such amount as shall be established by the Board of Directors, and said annual dues shall be paid on a calendar year basis. Each new Associate Member shall, upon acceptance for membership, pay an initiation fee in an amount established by the Board of Directors. Annual dues shall be due from new Associate Members on a pro rata basis from date of acceptance. 

Section 3. Dues and Initiation Fee Levels. The annual dues and initiation fees established under Section 1 for Distributor Members shall be the same as the annual dues and initiation fees established under Section 2 for Associate Members.

Section 4. Payment Date. Annual dues shall become due and payable in full on February 1 in each year for the ensuing twelve months period, except for new members whose annual dues shall be on a pro rata basis from date of acceptance.

Section 5. Lifetime Members. Lifetime Members shall not be liable for dues.

Section 6. Nonpayment of Dues. It shall be the duty of the Secretary to report to the President, on or before any regular or special meeting of the Association, the name of any member who may, at the time of the meeting, be sixty (60) days or more in arrears of its obligation to pay annual dues. No such member so in arrears shall have its vote counted on any matter submitted in such meeting or be counted in ascertaining a quorum. If any member shall fail to pay annual dues within two (2) months after the date when such annual dues are payable, such member may, by a vote of a majority of the Directors present at any meeting thereof, be suspended from the Association until its full annual dues for the current year shall have been paid. During suspension its rights to attend meetings and to avail of other privileges of the Association shall also be suspended. Two (2) months after the date on which any installment of dues is payable, the Secretary shall notify all such members in arrears, quoting this paragraph of the By-Laws. If the dues of any member remain unpaid for a term of three (3) months, the name of such defaulting member may be stricken from the rolls of the Association by order of the Board of Directors and thereupon, all its rights and privileges in the Association shall be forfeited and extinguished. Any newly elected member company shall be considered to have withdrawn its application and membership by non-payment of initiation fee and dues within 30 days after the date of the initial dues statement.

ARTICLE X 
COMMITTEES  

Section 1. Committees of Members. The Board of Directors, by resolution passed by a majority of the Directors at any meeting at which a quorum is present, shall designate such standing committees to be composed of such number of members and with such powers and duties as the Board of Directors may direct and specify in the respective resolutions appointing them. A majority of all the members of any such committee may determine its action and fix the time and place of its meetings, unless the Board of Directors shall otherwise provide. The President, subject to the approval of the Board of Directors, shall designate persons to constitute standing and such other committees as he or she may deem necessary or advisable to consider and report on any matter. No such committee shall have any power to bind the Association in any way, except subject to the approval of the Board of Directors. The President, subject to the approval of the Board of Directors, shall appoint a chairman of each such committee, establish a committee budget, if necessary, and the chairman shall then determine the time and place of its meetings. The President, subject to the approval of the Board of Directors, shall have power at any time to change the members of any such committee, to fill vacancies and to discharge any committee. All members of such committees shall be Members, partners or employees of Members.

Section 2. Nominating Committee. No later than sixty (60) days prior to the date designated for the Annual Meeting, the President shall appoint a nominating committee consisting of the three immediate past Presidents, together with two Members. The President shall designate one member as chairman and the committee shall nominate candidates for Distributor Directors to be elected at the Annual Meeting. The chairman shall place the names in nomination at the Annual Meeting. Additional names may be placed in nomination by a writing sub scribed by ten Members and submitted to the Secretary thirty (30) days prior to the Annual Meeting.

ARTICLE XI
INDEMNIFICATION

Section 1. Right of Indemnification. The Association shall indemnify any member, director, officer or employee or a former member, director, officer or employee of this Association against expenses (including attorney’s fees), judgments, decrees, fines, penalties or amounts paid in settlement in connection with the defense of any pending or threatened action, suit or proceeding, criminal or civil, to which he or she is or may be made a party by reason of being or having been such member, director, officer or employee, provided it is determined by one of the methods hereinafter set forth that (a) such member, director, officer or employee was not and has not been adjudicated to have been guilty of misconduct in the performance of his or her duty to the Association, (b) he or she acted in good faith in what he or she reasonably believed to be the best interest of this Association, (c) that in any matter the subject of a criminal action, suit or proceeding he or she had no reasonable cause to believe that his or her conduct was unlawful, and (d) in case of settlement, the amount paid in settlement was reasonable. Such determination shall be made by a majority vote of the Directors of the Association acting at a meeting at which a quorum consisting of Directors who are not parties to or threatened with any such action, suit or proceeding is present or, in the event such a quorum cannot be assembled, by a majority vote of the members of the Association acting at a meeting at which a quorum consisting of members who are not parties to or threatened with any such action, suit or proceeding is present, or, in the event such a quorum of members cannot be assembled, by an attorney at law, other than an employee of the Association, selected by the highest ranking officer of the Association, who is not a party to or threatened with any such action, suit or proceeding. To the extent that a member, director, officer or employee has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in the first paragraph of this Section 1, or in defense of any claim, issue or matter therein, he or she shall be indemnified against expenses (including attorneys’ fees) actually or reasonably incurred by him or her in connection therewith.

Section 2. Advances of Expenses. The Association, when authorized by the Board of Directors (whether a disinterested quorum exists or not), may advance to any such person expenses with respect to any such pending or threatened action, suit or proceeding prior to the final disposition thereof upon receipt of an undertaking by the recipient to repay such advances unless it shall ultimately be determined that he or she is entitled to be indemnified by the Association.

Section 3. Purchase of Insurance. The Association may purchase and carry insurance on behalf of any such member, director, officer or employee against any liability asserted against him or her or incurred by him or her in any such capacity or arising out of his or her status as such, regardless of whether the Association would have the power to indemnify him or her against such liability.

Section 4. Rights not Exclusive. The indemnification provided in this Article shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under the Articles of Incorporation, these By-Laws, any agreement, any insurance purchased by the Association, vote of members or otherwise, and shall continue as to a person who has ceased to be a member, director, officer or employee and shall inure to the benefit of the heirs, executors and administrators of such person; provided, however, there shall be no duplicate payments by or on behalf of the Association.

ARTICLE XII
AMENDMENTS

 These By-Laws may be amended (a) by the vote of 2/3 of the Members of the Board of Directors at any meeting at which a quorum, as fixed by the By-Laws, is present, or (b) at any Annual Meeting or at any special meeting by the vote of a majority of the Distributor Members of the Association present in person or by proxy, provided that a quorum, as fixed by the By-Laws, shall be present.

Revised and Reprinted: - 6/04
25091/03992
503976.1

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