Out for Profit Investment Club
Articles of Agreement
As Amended January 1, 1996, January 1, 1998, May 14, 2003
The name of this partnership is the Out for Profit Investment Club (“Club”), whose primary purpose is to educate the members about investment and undertake investment in gay-friendly stocks, bonds, and other investment vehicles as determined by the Club membership.
These Articles of Agreement (“Articles”) represent the Club’s means of organization. These Articles of Agreement may be amended at any time by a two-thirds (2/3) majority of the Club membership present at any regular meeting of the Club, provided a copy of such proposed amendment has been submitted to each member at least two weeks (14 days) before the meeting at which such action is to be taken on the amendment. Changes of a purely clerical nature (e.g. spelling errors) may be made without vote.
I. Purpose of the Club
To provide a means and forum for gay men and lesbians to invest funds and thereby accumulate capital in a mutually supportive environment that is cognizant of issues important to the gay/lesbian/bisexual/ transgendered/transsexual (GLBT) community.
To attempt to double the Club’s investment in 5 years, or in excess of that available through an investment in the Standard & Poor's 500 Index, with such return being measured on a longer-term time horizon (5-7 years).
To develop a diversified investment portfolio having a primary emphasis on equity, and secondarily on fixed income and option instruments.
To foster and enhance each member's knowledge of the principles of sound and prudent investing, thereby encouraging each member to undertake a personal investment program which addresses that member's distinct financial planning objectives in connection with that individual’s longer term well being.
For the purposes of investment, focus upon securities (stocks, fixed income and options), each offering the prospect for superior returns (in the form of current income and/or capital gains) provided such securities are not in any manner associated with corporate entities which by virtue of behavior, or policy (implicit or explicit) have demonstrated to be prejudicial to the GLBT community and/or hostile to the interests of GLBT individually, or as a community.
In seeking above average capital returns, encourage investment in securities of corporate entities that have demonstrated express support for gay men and lesbians by way of employment practices, or support of causes important to the gay and lesbian community.
As capital in the investment fund is accumulated, advance the empowerment of the GLBT community and the U.S. economy by:
(i) disseminating information regarding the securities of the GLBT friendly corporations to the broader GLBT community;
(ii) through this dissemination encouraging GLBT to invest in GLBT friendly corporations; and
(iii) making corporations aware of the linkage between shareholder value and the increasing magnitude of accumulated gay and lesbian capital and the investment criteria of the gay and lesbian community.
To encourage active participation and mutual responsibility among all organization participants in recommending investment acquisitions and divestitures, while fostering an environment that encourages both social interaction and professional networking.
II. Membership of the Club
The membership consists of:
Active Partners - Members who have signed the level and binding partnership agreement; made an initial minimum investment of $500 and have committed to making a monthly investment of at least $55 as stipulated in the partnership agreement.
Active partners cease to be active when they meet the definition of inactive partners below.
Inactive Partners - Members who have not attended three (3) consecutive meetings within a one (1) year period or have not made monetary investments to the partnership for three (3) consecutive months. Inactive partners forfeit their right to vote.
Inactive partners may reactivate their membership by attending a meeting and by paying all outstanding monetary investments including late payments penalties.
New Members - A membership package will be given to new members to acquaint them with the purpose and goals of the club. Anyone considered for membership shall have been a guest for at least two prior meetings. New members shall be admitted in accordance with the partnership agreement.
III. Meetings
Date and time - the Club shall meet once monthly on a Tuesday evening for approximately two hours at a pre-announced location.
Special Meetings - A special meeting may be called at any other time by 2/3 of all partners. A written notice, prepared by the Treasurer, will be mailed to all partners at least one week prior to the date of the proposed meeting.
Meeting Procedures - Roberts Rules of Order shall be the authority governing all of the Club's procedures.
Quorum - A quorum is defined by the club as a simple majority of active partners. A quorum exists when there is a simple majority of active members either by way of actual physical presence or by way of proxy tendered by an active member who is not physically present to an attending active member. A quorum must be present before a meeting is considered official. No investment decisions may be made without a quorum present.
Guests - The partners reserve the right to admit or refuse admittance to any visitors. The partners also reserve the right to determine the level of any guest's participation in the meeting.
Voting - Each partner shall have one vote. As per the partnership agreement, no partner's capital account shall exceed 20% of the capital accounts of all partners.
Proxy votes will be accepted only for buy and sell orders and administrative decisions. The Proxy must be in written form and presented to the Treasurer at the meeting.
IV. Elections of Officers and Responsibilities
Officers of the Club will consist of President, Vice President, Treasurer and, as may be needed by the Club a Compliance Officer and Marketing Officer.
President - The President is to preside over meetings, set meeting dates and locations, appoint committees and see that resolutions passed by the partnership are carried out.
Vice President - The Vice-president takes the place of the President when the President is absent or incapacitated. The Vice-president shall assign companies to report on at club meetings to each partner and shall be responsible for insuring that the Club's study program is properly carried out.
Treasurer - The Treasurer shall keep a record of the Club’s receipts and disbursements and partners’ interests in the Club. The Treasurer will give partners receipts for payments, place the buy and sell orders authorized by the partners with the Club’s broker, and prepare the Club’s valuation statement. The Treasurer will see that the needed tax information is compiled and file the necessary reports. The Treasurer will circulate the broker’s most recent statement to all members at each monthly meeting. The Treasurer will pay bills for costs incurred by the Club, in accordance with the terms of these Articles.
Compliance Officer - The Compliance Officer shall ensure that the companies presented to the partners meet the compliance and GLBT requirements herein discussed and to assist partners in their correspondence with companies to achieve this goal.
Marketing Officer - The Marketing Officer shall direct, guide, manage and handle the Club’s outreach to the community, companies, and individuals. In this regard, the Marketing Officer shall review and approve all marketing materials (including but not limited to web pages, brochures, stationary, press releases, etc…) to the extent such marketing materials are approved for release by the Club. The Marketing Officer shall also manage and handle either personally or through a designated individual, public relations of the Club and other related activities, functions and events.
The terms of office will be one year. Officers will be elected by a simple majority of all active partners present at an official meeting.
Elections shall be held in November and the term of office begins on January of the new year, after a one-month transition period. During the transition period, newly elected officers will serve alongside outgoing officers in preparing for serving in their respective office.
Officers of the Club may be removed for cause by a 2/3 majority of active partners present at an official meeting.
V. Administration
The portfolio will be valued monthly by the Treasurer and a statement will be presented to the membership at the monthly membership meeting.
In maintaining the records of each partner's capital account in the club, the unit value method as outlined in chapter 20 of the NAIC Investor’s Manual will be used.
All basic expenses will be handled on a reimbursement basis. All expenses under $.500.00 will require the signature of the Treasurer and all expenses over $500.00 shall require the approval of the Treasurer and the signature of the Treasurer and of one other officer.
Late fees shall be accounted for by adding them to the cash account. Late fees thus will increase each partner’s capital account on a pro-rata basis. Proceeds from the imposition of late fees pursuant to this Article V and Article VIII, are to be used and managed by the Treasurer on behalf of the Club for the payment of reasonable and ordinary expenses and marketing and social activities.
On an annual basis, an audit of the books of the club shall be conducted at an official meeting, or if it is so agreed by a majority of active partners present at an official meeting, an audit committee will be appointed to conduct an audit of the books of the Club.
All administrative decisions shall require a simple majority vote of active partners present at an official meeting.
No partner may use partnership assets for non-partnership business.
No partner shall enter the partnership into any obligation other than those set forth in the partnership agreement of the Articles of Agreement.
Payment of rental space by the Treasurer on behalf of the Club will be treated as a reasonable and ordinary expense to be paid by the Club, subject to review in such case that membership to the Club exceeds 15 members.
VI. Compliance and Conflict of Interest
In order to address the compliance issues of partners the partnership agrees to disregard the negative responses from any partner's compliance area when making decisions about one’s personal portfolio.
VII. Selecting and Purchasing Stocks
Stocks (or other investment vehicles) must be formally presented to the membership using the NAIC's guidelines. In addition, the presenting partner is responsible for including a report on the proposed company's sensitivity to issues important to the GLBT community through the following methods: (1) using the questionnaire/survey developed by the Compliance Officer, (2) providing the proposed company’s GLBT policy as ascertained through direct verbal contact with such company or through such company’s written policy as may be provided in investor publication, web-site, or (3) referencing a third party evaluation on the proposed company’s GLBT policy. Disclosure of GLBT policy, whether positive or negative, is a condition that must be satisfied before the Club can make an initial stock purchase and effectuate subsequent stock activity (should there be a change in the company’s GLBT policy).
Each partner must make one full presentation per year (exclusive of stock updates) for the consideration of the partners.
The Club will not consider buying or selling a stock for which the Club has not received updated information that conforms to the NAIC's guidelines.
The Club will then vote on the purchase or sale of the stock(s). The Club may select a primary and alternate transaction each time stocks or securities are selected for purchase.
Each partner who requires compliance clearance must check with his/her company's compliance area and communicate only negative responses to the Treasurer by 5:00pm on the second business day after a transaction has been approved by the partnership. The transaction will be implemented on the third business day.
Buy-Sell stock decisions require a majority vote of all active partners present at an official meeting including proxy votes.
The Treasurer will not execute any buy-sell orders on a stock if notified of a compliance conflict.
Any security for which any partner's compliance area has expressed a negative response shall be ruled out. If the primary transaction is ruled out, the alternate transaction would be implemented. If both transactions are ruled out, no transaction will be implemented.
The Treasurer will arrange to have duplicate confirms sent to a partner's compliance area when required. Any additional fee for this will be the responsibility of that partner.
If a partner does not attend the meeting where buy-sell decision is made, it is the partner's responsibility to contact an officer to learn of the decision.
In cases where a stock purchase is conditioned on the occurrence of certain findings or events, it shall be the duty of the presenting partner or some other member as designated by the Club to determine whether such finding or event exists. Such finding or event shall be made in a timely fashion, no later than 48 hours from the time of the meeting of the Club. If such findings or events satisfy the condition, the presenting partner (or designated member) is to immediately inform the Treasurer, who shall then be authorized to execute the type of stock activity authorized by the Club, without additional notice to members. Should the conditions for stock activity not be satisfied in the time limits provided herein, no stock activity shall occur except by way of a regular meeting of the Club.
VIII. Investments, Voluntary and Involuntary Withdrawals
The monthly contributions by partners must be a minimum of $55.00 and may increase in value but a partner's total share may not exceed the 20% limit as stated in the partnership agreement.
A minimum of $55.00 investment will be due at the monthly meeting. There will be a $15.00 penalty for late payments. If a partner is unable to attend the meeting it is the partner's responsibility to mail his/her payment to the Treasurer at his/her home address.
The payment must be post-marked not later than the day after the meeting in order not to .be considered late.
An individual partner may withdraw funds, in part or in total, on a quarterly basis, by notifying the Treasurer within 60 days before the first of the month of December, March, June, or September. The pay-out will be made no later than ten business days after the meeting in December, March, June or September.
For a voluntary withdrawal, as defined in the partnership agreement, the withdrawing partner will receive 95% of the value of his/her shares less any associated fees if the partner withdraws within two years of joining the Club. After two years, the partner will receive the full value his/her share less any associated fees.
Once a partner has become inactive, an officer will call the partner to notify him/her that he/she will be cashed out. After he/she has missed or not paid for five consecutive months, an officer will send the inactive partner a letter and, if the partner has not become active by then, he/she will be cashed out, by involuntary withdrawal, at the next quarter in accordance with paragraph 28 of the partnership agreement. For involuntary withdrawals, the withdrawing partner shall receive 85% of the value of his/her share less any associated fees, in accordance with the partnership agreement.
For voluntary or involuntary withdrawals, any late fees owed by the withdrawing partner shall be included in associated fees.
Any partner that does not re-sign the partnership agreement will be cashed out at the end of the first quarter in accordance with the involuntary withdrawal provisions of paragraph 28 of the partnership agreement.
Any partner can sell his share to another partner upon a 2/3 vote of all partners in favor of the transfer. For this type of withdrawal, the partner will receive the full amount of his/her share less any associated fees.
Any partner may sell his/her share to a non-member if the partners approve the prospective purchaser for membership in the Club. For this type of withdrawal, the partner will receive the full value of his/her shares less any associated fees.