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Answering these few simple questions will
provide a clear indication of how ready your organization
is to pursue building an endowment. If your organization
isn't quite The Organization is the grassroots, community
group that is establishing the endowment.
The Foundation is the regional community foundation which
will administer the endowment.
The Fund is the endowment fund established by The Organization.
The Organization has delivered as an irrevocable gift to
The Foundation the property described in Schedule A hereof.
It is The Organization's request that such gift, together
with any additional gifts which may hereafter be made to
the fund hereafter described, be used to establish and maintain
an endowment fund (The Fund) of The Organization to be administered
as follows:
- The Fund shall be known and identified as such by The
Foundation and its Trustees in the course of the administration
and distribution thereof.
- The initial gift used to establish
The Fund, and any subsequent gifts thereafter, will be
permanently restricted (endowed). A minimum initial investment
of $25,000 and commitment of $100,000 is required of
The Organization by the Foundation to open a new fund.
- The Fund shall be a component part of The Foundation,
pooled for investment purposes. Both social and environment
screens are applied to the portfolio. The Foundation has
the responsibility and authority for the investment of
the assets of The Fund. The Foundation does not guarantee
the growth of fund corpus or the value of the original
donation. Although the goal is a steady increase in corpus
over time, investment results are subject to the performance
of the manager and the vicissitudes of the market.
- All
funds administered by The Foundation share proportionately
in the direct expenses of managing the portfolios. In
addition, The Fund is subject to an annual administration
fee of 1%.
- The Fund may be added to at any time, in any
amount. Donations are credited on the last day of the
month in which they arrive. Neither income nor expense
will accrue to The Fund until the gift has been credited.
- Distributions will be made annually to The Organization.
The annual percentage payout will be reduced over a five
year period at the rate of 0.1% per year, beginning in
Fiscal Year 2009, until the annual percentage payout
has been reduced from 5.0% to a permanent rate of 4.5%.
The amount of the distribution will be based on the average
value of The Fund as of March 31 for the preceding three
fiscal years. The Organization shall inform the Foundation
on an annual basis of the percentage distribution it
seeks, up to the maximum payout for that year.
- Distributions
shall ordinarily be made out of income only so that the
principal of The Fund may be preserved and maintained
as an endowment. The Foundation Trustees may authorize
distributions that invade the principal in order to make
the distributions as provided in 6 above.
- Notwithstanding
anything herein contained to the contrary, The Fund shall
at all times be held and administered in accordance with
the provisions of the Articles of Incorporation and Bylaws
of The Foundation and applicable tax regulations, all
of which are hereby accepted and agreed to by the undersigned,
including those provisions relating to amendment, termination,
and variance from the donors' directions. The undersigned
acknowledges that under the provisions of the applicable
tax regulations, The Foundation Trustees have the power
and the duty to modify any restrictions or conditions
on the distribution of funds for any specified charitable
purpose if, in its sole discretion, the recipient has
become, in effect, unnecessary or incapable of fulfillment
or inconsistent with the charitable needs of the community.
- Upon the termination, dissolution, or winding up of The
Organization in any manner or for any reason, voluntary
or involuntary, or if The Organization ceases its charitable
purpose, distributions go to the nearest similar 501(c)(3)
organization in the community as determined by The Foundation's
Board of Trustees, unless the Board of Trustees of The
Organization names the nearest similar 501(c)(3) organization
that the distributions shall be directed towards.
- Upon the
termination, dissolution, or winding up of The Foundation
in any manner or for any reason, voluntary or involuntary,
the assets in The Fund remaining after the payment or
provision for payment of all liabilities shall be distributed
to The Organization, as long as The Organization still
maintains its 501(c)(3) organization status.
Accepted this __________ day of _____________________, ________.
Name of The Fund:
By: _______________________ ______________
Name Title
The Foundation:
By: _______________________ ______________
Name Title
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