The Virginia Nonstock Corporation Act, specifically referencing provisions related to director duties and conflicts of interest, dictates the standard of care for directors. When a director has a material financial interest in a contract or transaction with the corporation, they must disclose their interest and the material facts of the transaction to the board. Following disclosure, the director may participate in the discussion and vote on the transaction if it is approved by a majority of the disinterested directors or, if there are no disinterested directors, if the transaction is fair to the corporation at the time it is authorized. The scenario presented involves a director of a Virginia nonprofit who is also a principal in a consulting firm seeking to contract with the nonprofit. This constitutes a conflict of interest. The director’s disclosure of their interest and the material facts of the proposed contract to the board of directors is the initial and critical step. If the board, comprising disinterested directors, then approves the contract after reviewing the disclosed information, and the terms are demonstrably fair to the nonprofit, the transaction is generally considered valid and protected from challenge based solely on the conflict of interest. The absence of the director’s vote on the matter after disclosure is a key element of proper procedure. Therefore, the most appropriate action for the board to take, assuming the director has made full disclosure and recused themselves from voting, is to approve the contract if it is deemed fair and reasonable to the nonprofit.

Virginia law, specifically the Virginia Nonstock Corporation Act (VCA), governs the operation of nonprofit corporations. When a nonprofit corporation in Virginia wishes to amend its articles of incorporation, the process is primarily dictated by the VCA. Section 13.1-826 of the Code of Virginia outlines the procedure for amending articles of incorporation for nonstock corporations. Generally, amendments require a resolution from the board of directors and approval by the members, if the corporation has members, or by a specified voting group of members if applicable. The articles of incorporation themselves may also specify a different voting requirement. However, the VCA provides a mechanism for amendment even if the articles are silent on the specific procedure, typically requiring a majority vote of the directors and, if members exist, a majority vote of the members present and voting at a meeting where a quorum is present. The filed articles of incorporation are the foundational document, and any changes must be formally adopted and filed with the Virginia State Corporation Commission. The specific content of the amendment, such as changing the name or purpose, is also subject to legal limitations, for instance, the purpose must remain charitable or educational if it is a public benefit corporation. The amendment must be approved by the board of directors and, if the corporation has members, by the members. The VCA mandates that the amendment be adopted by the board of directors and, if the corporation has members, by the members. The articles of incorporation themselves may specify a different voting requirement. The board of directors must adopt a resolution setting forth the proposed amendment. If the corporation has members, the proposed amendment must then be submitted to the members for approval. The VCA requires that the amendment be adopted by a majority of the votes cast by the members entitled to vote thereon at a meeting at which a quorum is present. If there are no members, or no members with voting rights, the amendment is adopted by the board of directors. The amendment is then filed with the Virginia State Corporation Commission.

The Virginia Nonstock Corporation Act, specifically Virginia Code § 13.1-801 et seq., governs the formation and operation of nonprofit corporations in Virginia. A critical aspect of this act is the process by which a nonprofit corporation can dissolve. Dissolution can be voluntary or involuntary. Voluntary dissolution typically begins with a resolution adopted by the board of directors and, in most cases, approval by the members. Following the adoption of the dissolution resolution, the corporation must cease conducting its business except as necessary to wind up its affairs. This winding up process involves collecting assets, paying liabilities, and distributing remaining assets according to the articles of incorporation or the Virginia Nonstock Corporation Act. The Act requires that a Certificate of Dissolution be filed with the Virginia State Corporation Commission. This certificate must include specific information, such as the date the dissolution resolution was adopted, a statement that the resolution was adopted in accordance with the Act, and that the corporation has complied with winding up requirements. The filing of this certificate is a key step in formally ending the corporation’s legal existence. For a nonprofit corporation, distributing remaining assets after winding up is subject to specific rules, generally requiring distribution to another nonprofit organization with similar purposes or as directed by the articles of incorporation, rather than to members or private individuals. The process is designed to ensure that the corporation’s assets are used for charitable or public benefit purposes, aligning with its nonprofit status.

The Virginia Nonstock Corporation Act, codified in Title 13.1, Chapter 10 of the Code of Virginia, governs the formation and operation of nonprofit corporations in the Commonwealth. A key aspect of this act pertains to the rights and responsibilities of members, particularly concerning amendments to the articles of incorporation. Section 13.1-822 outlines the process for amending articles of incorporation. It generally requires approval by the board of directors and then by the members, unless the articles themselves specify a different procedure. For corporations without members, or where the articles grant the board sole authority, board approval may suffice. However, when members exist and have voting rights, their consent is typically necessary for significant changes that affect their rights or the corporation’s fundamental structure. Specifically, amendments that alter the rights of a class of members, change the corporate purpose, or modify the manner of electing directors often necessitate member approval. The question focuses on a scenario where a nonprofit’s articles of incorporation are silent on the specific procedure for amending them, and the corporation has a class of members with voting rights. In such cases, the default provisions of the Virginia Nonstock Corporation Act apply. These default provisions, as interpreted and applied in practice, generally require member approval for amendments that materially affect member rights or the corporation’s structure, even if not explicitly stated in the articles. Therefore, obtaining the consent of the voting members is the legally sound approach to ensure the amendment is valid and defensible against potential challenges.

The scenario involves a Virginia nonprofit corporation, “Riverbend Conservancy,” which has been operating for several years. The question centers on the proper procedure for a director to resign from the board. In Virginia, as outlined in the Virginia Nonstock Corporation Act (Title 13.1, Chapter 10 of the Code of Virginia), a director may resign at any time. The Act specifies that resignation is effective upon giving notice to the corporation, unless the notice specifies a future effective date. The notice of resignation should be provided to the corporation, typically through its board of directors or a designated officer. The resignation does not require acceptance by the board to be effective. The Virginia Nonstock Corporation Act, specifically § 13.1-827, states that “A director may resign at any time by delivering written notice of resignation to the corporation.” The key is the delivery of the notice. While internal bylaws might dictate the exact recipient of the notice (e.g., the board chair, the secretary, or the full board), the act of delivery itself makes the resignation effective. Therefore, delivering the resignation to the board of directors, which is the governing body of the corporation, is the legally sufficient action for the director to effect their resignation. The subsequent actions of the board, such as acknowledging receipt or electing a replacement, are procedural and do not invalidate the resignation itself.

The Virginia Nonstock Corporation Act, specifically § 13.1-801 et seq. of the Code of Virginia, governs the formation and operation of nonprofit corporations in the Commonwealth. A critical aspect of this governance relates to the fiduciary duties owed by directors. Directors of Virginia nonprofits owe duties of care, loyalty, and obedience. The duty of care requires directors to act with the care that a reasonably prudent person in a like position would exercise under similar circumstances, including being informed about the affairs of the corporation. The duty of loyalty mandates that directors act in the best interests of the corporation and its members, avoiding self-dealing and conflicts of interest. The duty of obedience ensures that directors act in accordance with the corporation’s articles of incorporation, bylaws, and applicable laws. When a director acts in a manner that appears to violate these duties, the corporation’s board, or in some cases, a court, may take action. A director’s resignation is a personal choice and does not automatically absolve them of liability for past actions taken while in office. Therefore, even after resigning, a director can still be held accountable for breaches of fiduciary duty that occurred during their tenure, provided the action is brought within the relevant statute of limitations. The question tests the understanding that resignation does not erase prior fiduciary responsibilities or potential liabilities.

The scenario involves a Virginia nonprofit organization, “Chesapeake Conservation Corps,” which has received a significant donation from a private foundation. The question centers on the governance responsibilities of the board of directors concerning such a donation, particularly when it comes with specific stipulations. Virginia law, as codified in the Code of Virginia, particularly Title 13.1 pertaining to nonprofit corporations, outlines the duties of directors. Directors have a duty of care and a duty of loyalty. The duty of care requires directors to act in good faith, with the ordinary care of a prudent person in a like position, and in a manner they reasonably believe to be in the best interests of the corporation. The duty of loyalty requires directors to act in the best interests of the corporation, not in their own personal interest or the interest of another entity. When a donation comes with specific restrictions, the board must ensure that these restrictions are legal, consistent with the organization’s mission, and that the organization has the capacity to fulfill them. Accepting a donation that the organization cannot reasonably administer or that conflicts with its core purpose would violate the duty of care. Furthermore, if any director has a conflict of interest regarding the donor or the specific use of the funds, they must recuse themselves from discussions and decisions related to that donation, adhering to the duty of loyalty. The board’s primary fiduciary responsibility is to the nonprofit itself and its mission, not to the donor’s personal preferences if those preferences are unmanageable or detrimental. Therefore, the board must conduct a thorough review to ascertain the feasibility and alignment of the donor’s stipulations with the organization’s mission and operational capacity. This review process ensures responsible stewardship of donated assets and compliance with legal obligations. The ultimate decision rests with the board, acting collectively and in good faith, to determine if accepting the donation, as stipulated, serves the best interests of the Chesapeake Conservation Corps.

The Virginia Nonstock Corporation Act, which governs nonprofit corporations in Virginia, mandates specific procedures for fundamental corporate changes. When a Virginia nonprofit corporation proposes to merge with another entity, the Act requires that the board of directors adopt a resolution approving the plan of merger. This resolution must then be submitted to the members for their approval. The Virginia Nonstock Corporation Act, specifically § 13.1-903, outlines that a merger requires the affirmative vote of at least two-thirds of the votes cast by members entitled to vote thereon, unless the articles of incorporation or bylaws specify a different voting threshold, provided it is not less than a majority. In this scenario, the board of directors of the “Chesapeake Conservancy Alliance,” a Virginia nonprofit, has voted to approve a merger with the “Shenandoah Riverkeepers,” another Virginia nonprofit. The articles of incorporation are silent on the merger voting requirement, and the bylaws state that a merger requires approval by a majority of the members present at a meeting where a quorum is present. The question asks about the minimum percentage of affirmative votes from members present and voting at a duly called meeting to approve the merger, assuming a quorum is met. Since the bylaws specify a majority of members present at a meeting with a quorum, and the articles are silent, the bylaws’ provision governs. Therefore, a simple majority of the votes cast by members present at the meeting where a quorum is established is sufficient. This translates to 50% plus one of the votes cast.

The Virginia Nonstock Corporation Act, specifically under Chapter 10.1 of Title 13.1 of the Code of Virginia, governs the formation and operation of nonprofit corporations. When a nonprofit corporation in Virginia wishes to amend its articles of incorporation, the process requires a formal resolution adopted by the board of directors, followed by a vote of the members, if the articles or bylaws grant members voting rights on such matters. The amended articles must then be filed with the Virginia State Corporation Commission. Section 13.1-810 of the Code of Virginia outlines the procedure for amending articles of incorporation for nonprofit corporations. This section mandates that amendments must be approved by the board of directors and, if the corporation has members, by the members. The specifics of member approval, such as the required voting threshold, are typically detailed in the corporation’s bylaws. Without a specific provision in the bylaws requiring a supermajority for amendments, a simple majority of votes cast by members present at a duly called meeting, assuming a quorum is present, is generally sufficient for member approval of amendments. The question asks about the requirement for amending articles of incorporation regarding a change in the registered agent and address. This is a fundamental amendment to the articles. The Virginia Nonstock Corporation Act requires that such amendments be approved by the board and, if applicable, the members. The act does not stipulate a specific percentage for member approval of amendments unless the articles or bylaws specify otherwise. In the absence of such specific provisions, the general rule for member action applies, which is typically a majority of votes cast, assuming a quorum. Therefore, a majority vote of the members present at a meeting where a quorum exists is the standard requirement for approving amendments to the articles of incorporation when no higher threshold is specified in the governing documents.

The Virginia Nonstock Corporation Act, which governs nonprofit corporations in Virginia, outlines specific requirements for the dissolution of such entities. When a nonprofit corporation voluntarily dissolves, it must follow a prescribed procedure to wind up its affairs. This process involves ceasing operations, notifying creditors, and distributing assets. Crucially, Virginia law mandates that upon dissolution, after satisfying all liabilities and obligations, any remaining assets must be distributed to one or more organizations that are themselves qualified under Section 501(c)(3) of the Internal Revenue Code, or to a governmental entity for a public purpose. This ensures that the charitable purpose for which the nonprofit was established continues to be served, even after its dissolution. Failure to adhere to this distribution requirement can lead to legal challenges and improper asset diversion. The Act’s intent is to prevent private inurement of assets from charitable organizations. Therefore, distributing assets to the founders’ private foundation, even if it also has a charitable mission, would be permissible only if that private foundation is itself a 501(c)(3) organization and the distribution aligns with the dissolving entity’s original purpose. However, distributing assets to members, who are not necessarily 501(c)(3) organizations, is generally prohibited unless the members are also qualified charitable entities. Distributing to a foreign nonprofit not qualified in Virginia or to a for-profit subsidiary would also contravene the statutory requirements for asset distribution upon dissolution.

The Virginia Nonstock Corporation Act, specifically § 13.1-801 et seq. of the Code of Virginia, governs the formation and operation of nonprofit corporations in the Commonwealth. A fundamental aspect of this act is the process by which a nonprofit corporation can amend its articles of incorporation. Generally, amendments require a resolution approved by the board of directors and then a vote by the members, if the corporation has members. The Code of Virginia specifies the required voting thresholds. For amendments to the articles of incorporation, a majority of the votes cast by members entitled to vote thereon at a meeting of members duly called and held for that purpose, or if members are not entitled to vote thereon, by the board of directors, is typically sufficient. However, certain fundamental changes, such as altering the purpose or dissolving the corporation, might require a higher threshold, often two-thirds of the votes cast by members. Without specific provisions in the articles of incorporation or bylaws dictating a higher standard, the statutory default applies. In this scenario, the board of directors proposes an amendment to the articles of incorporation to change the organization’s name. Assuming the articles of incorporation do not specify a different voting requirement for this type of amendment, and the corporation has members who are entitled to vote on such matters, the amendment must be approved by a majority of the votes cast by the members present and voting at a properly convened meeting. The question asks for the minimum number of votes needed from the 100 members present and voting to approve the amendment. If 60 members vote in favor and 40 vote against, this constitutes a majority of the votes cast (60 out of 100). Therefore, 60 votes are sufficient.

The Virginia Nonstock Corporation Act, which governs nonprofit corporations in Virginia, outlines specific requirements for the dissolution of a nonprofit. When a nonprofit corporation in Virginia decides to dissolve, the process is not instantaneous and involves several critical steps to ensure proper winding up of affairs and distribution of assets. The Act mandates that a plan of dissolution be adopted by the board of directors and then approved by the members, if the corporation has members with voting rights. This plan details how the corporation’s affairs will be wound up, including the settlement of debts and the distribution of remaining assets. Crucially, Virginia law requires that after all debts and liabilities have been paid or adequately provided for, any remaining assets must be distributed to one or more organizations that are themselves qualified under Section 501(c)(3) of the Internal Revenue Code, or to a governmental entity for a public purpose, or to any other person or organization as permitted by the articles of incorporation or bylaws, provided such distribution is consistent with the nonprofit’s purpose. The Act does not permit distribution to directors, officers, or members, as this would violate the nonprofit status. Following the adoption of the dissolution plan and the distribution of assets, the corporation must file Articles of Dissolution with the Virginia State Corporation Commission. The filing of these articles officially terminates the corporation’s legal existence. Therefore, the completion of the distribution of assets to eligible entities, as outlined in the dissolution plan and Virginia law, is a prerequisite for the final legal termination of the nonprofit corporation.

The Virginia Nonstock Corporation Act, which governs nonprofit corporations in Virginia, outlines specific procedures for amending articles of incorporation. Section 13.1-820 of the Code of Virginia details that amendments require a resolution adopted by the board of directors, followed by approval from the members. Specifically, the Act mandates that the board must adopt a resolution setting forth the proposed amendment. This resolution must then be submitted to the members for a vote. Unless the articles of incorporation or bylaws specify a greater quorum or voting requirement, a quorum of members must be present, and the amendment must be approved by a majority of the votes cast by members entitled to vote thereon. For nonprofits, especially those with a membership structure, the member vote is a crucial governance step, ensuring that the fundamental governing documents reflect the will of the membership. Failure to adhere to these procedural requirements, particularly the member approval step for significant changes like amending articles of incorporation, can render the amendment invalid and subject the corporation to legal challenges regarding its governance and operational validity. The board of directors’ initial adoption of the resolution is a necessary precursor, but it is not sufficient on its own to effectuate an amendment to the articles of incorporation.

The Virginia Code, specifically Chapter 14 of Title 57, governs nonprofit corporations. Section 57-14-102 outlines the requirements for annual meetings. For a Virginia nonprofit corporation, the bylaws typically dictate the frequency and notice period for annual meetings. While the law mandates that a nonprofit must hold annual meetings to maintain its corporate status and ensure accountability, it does not specify a fixed number of days for notice that applies universally to all situations. Instead, the bylaws, adopted by the board of directors and members, are the primary source for determining the notice period. These bylaws must be reasonable and consistent with the overarching provisions of the Virginia Nonstock Corporation Act. For instance, if the bylaws stipulate a 30-day notice period for annual meetings, this is the legally binding requirement for that specific organization. The law provides a framework, but the internal governance documents of the nonprofit flesh out the procedural details, including meeting notice requirements. Therefore, the specific number of days for notice is determined by the corporation’s own adopted bylaws, provided they comply with state law’s general principles of reasonableness and fairness in notice.

The Virginia Nonstock Corporation Act, specifically § 13.1-801 et seq., governs the formation and operation of nonprofit corporations in Virginia. A critical aspect of governance involves the process by which a nonprofit can amend its articles of incorporation. For amendments that materially alter the rights or preferences of a specific class of members, or that change the nature of the corporation, a supermajority vote of the members of that affected class is often required in addition to the general membership or board approval. Virginia law, in § 13.1-816, mandates that articles of incorporation can be amended by a resolution adopted by the board of directors and, if the corporation has members, by a majority vote of the members present and voting at a meeting for which notice was given. However, the articles of incorporation themselves, or bylaws adopted by the members, can prescribe higher voting thresholds, such as a two-thirds vote of all members or a supermajority of a particular class. In this scenario, the proposed amendment to change the corporation’s charitable mission directly impacts the fundamental purpose and likely the member’s understanding of their affiliation, thus warranting a higher level of consensus. The articles of incorporation stipulate a two-thirds vote of all members for such significant changes. Therefore, the amendment requires the affirmative vote of two-thirds of the entire membership, not just those present and voting, nor a simple majority of the board.

The Virginia Nonstock Corporation Act, which governs the formation and operation of nonprofit corporations in Virginia, outlines specific procedures for amending articles of incorporation. Section 13.1-825 of the Code of Virginia addresses the amendment of articles of incorporation for nonprofit corporations. Generally, amendments require a resolution adopted by the board of directors, followed by approval from the members. The Act specifies that unless the articles of incorporation provide otherwise, amendments that would materially alter the rights of members or the purpose of the corporation require the affirmative vote of at least two-thirds of the members present and voting at a meeting where a quorum is present. A change in the registered agent or registered office, while an amendment, is often a less significant alteration and may have different procedural requirements or be handled through a separate filing, depending on the specific provisions within the corporation’s articles and bylaws, and the nature of the change. However, when considering a fundamental change to the corporation’s purpose or structure, the member approval threshold is crucial. The question focuses on a material alteration to the corporation’s stated charitable purpose, which necessitates a higher level of member consent to ensure the organization remains true to its founding mission and complies with the spirit and letter of the Nonstock Corporation Act. The requirement for a two-thirds vote of members present and voting, assuming a quorum, is a standard safeguard against drastic changes to the nonprofit’s core objectives without broad membership support. This ensures that significant shifts in mission are democratically approved by the constituency the nonprofit serves or represents, aligning with principles of good governance and accountability within the nonprofit sector in Virginia.

The scenario describes a situation where a nonprofit organization in Virginia is considering a significant change in its mission and operational scope. Under Virginia law, specifically the Virginia Nonstock Corporation Act (which governs most nonprofits), fundamental changes to a corporation’s articles of incorporation, including a material alteration of purpose, typically require a vote of the members or, if the corporation is memberless, a vote of the board of directors, as outlined in the corporation’s bylaws. The Virginia Nonstock Corporation Act, as codified in Title 13.1, Chapter 10 of the Code of Virginia, mandates that amendments to the articles of incorporation must be adopted in accordance with the provisions of the articles themselves and the bylaws. Furthermore, if the change affects the rights of members, specific notice and voting procedures must be followed. The question probes the procedural requirements for such a substantial alteration. The correct course of action involves a formal amendment process to the articles of incorporation, which necessitates board approval and, depending on the bylaws and whether members exist, member approval, followed by filing the amendment with the Virginia State Corporation Commission. This process ensures that significant changes are properly documented and authorized, maintaining corporate governance integrity. The requirement for a two-thirds majority vote of the board of directors is a common threshold for major decisions in corporate governance, though bylaws can specify different quorum and voting requirements. Filing the amended articles with the State Corporation Commission is the final step to make the change legally effective in Virginia.

The Virginia Nonstock Corporation Act, specifically § 13.1-801 et seq. of the Code of Virginia, governs the formation and operation of nonprofit corporations. When a nonprofit corporation in Virginia intends to dissolve voluntarily, it must follow a prescribed statutory process. This process typically involves a resolution adopted by the board of directors and then approval by the members, if the corporation has members. The dissolution must then be filed with the Virginia State Corporation Commission (SCC). The question revolves around the specific conditions under which a Virginia nonprofit can initiate voluntary dissolution without member approval, focusing on situations where the corporation has no members or where the articles of incorporation or bylaws grant the board sole authority. Virginia Code § 13.1-891 outlines the procedure for voluntary dissolution, generally requiring member approval unless the articles of incorporation or bylaws specify otherwise, or if there are no members. The scenario presented describes a nonprofit with no members, making the board’s resolution sufficient for initiating the dissolution process, provided it is properly adopted and filed. The core concept tested is the statutory deviation from typical member approval requirements for dissolution in specific circumstances defined by Virginia law.

The Virginia Code, specifically Title 13.1, Chapter 10, governs nonprofit corporations. A critical aspect of this governance involves the dissolution process. When a nonprofit corporation in Virginia is dissolved, its assets, after satisfying liabilities and obligations, must be distributed for exempt purposes. This is a fundamental principle under both state law and federal tax law, which requires that upon dissolution, assets are distributed to another organization that is exempt under section 501(c)(3) of the Internal Revenue Code, or to a governmental unit for a public purpose. This ensures that the charitable purpose for which the organization was formed continues to be served and prevents private inurement of assets. The distribution is not to members, directors, or officers, unless they are also creditors of the corporation for legitimate debts. The Virginia Code outlines a specific order of priority for asset distribution, prioritizing creditors and then distributing remaining assets to other exempt organizations or for public purposes.

The Virginia Nonstock Corporation Act, specifically referencing provisions related to the dissolution of nonprofit corporations, outlines the procedures and requirements for winding up the affairs of such entities. When a Virginia nonprofit corporation voluntarily dissolves, the process involves several key steps to ensure all obligations are met and assets are properly distributed. This includes ceasing operations, notifying creditors, collecting receivables, and liquidating assets. A crucial aspect is the distribution of remaining assets after all debts and liabilities have been paid or provided for. Virginia law generally dictates that any remaining assets must be distributed for charitable purposes, aligning with the original mission of the nonprofit. This can involve distribution to other organizations that have similar or compatible charitable purposes, or as directed by a court. The Act emphasizes that assets cannot be distributed to members, directors, or officers of the corporation, as this would contravene the nonprofit status. Therefore, the distribution of assets to a successor organization with a similar mission is a legally permissible and common method of fulfilling the dissolution requirements under Virginia law.

The Virginia Nonstock Corporation Act, specifically § 13.1-801 et seq., governs the formation and operation of nonprofit corporations in Virginia. When a nonprofit corporation is dissolved, its assets must be distributed according to specific legal priorities. Section 13.1-906 outlines the order of distribution for assets upon dissolution. Generally, creditors and claimants are paid first. Following the satisfaction of all debts and liabilities, any remaining assets are distributed to those designated in the articles of incorporation or bylaws for such purposes, often another nonprofit organization with a similar mission, or to a public charity. This ensures that the charitable purpose for which the nonprofit was established continues to be served, or that remaining assets are used for public benefit, rather than being distributed to individuals like members or directors, unless the articles specifically allow for such distribution in a manner consistent with tax-exempt status. The key principle is that assets dedicated to charitable purposes should not inure to private benefit. Therefore, the correct distribution involves satisfying creditors and then distributing remaining assets to a designated entity for charitable or public purposes, as per the organizational documents and Virginia law.

The Virginia Nonstock Corporation Act, which governs nonprofit corporations in Virginia, outlines specific procedures for amending articles of incorporation. For a Virginia nonprofit, amendments typically require approval by the board of directors and then a vote by the members or, if no members are specified, by the directors themselves acting as members. The exact voting threshold for member approval is usually a majority of the votes cast by members entitled to vote, unless the articles of incorporation or bylaws specify a higher threshold. Section 13.1-827 of the Code of Virginia addresses amendments to articles of incorporation for nonprofit corporations. This section mandates that amendments must be adopted by the board of directors and then submitted to the members for approval. The approval by members requires a majority of the votes cast by members entitled to vote at a meeting at which a quorum is present, unless the articles or bylaws require a greater proportion. In this scenario, the proposed amendment to change the organization’s mission statement is a fundamental change that requires this statutory process. The board’s initial approval is a necessary first step, followed by member ratification. Without member approval, the amendment is not valid under Virginia law. Therefore, the amendment to the mission statement is not effective until it receives the requisite member approval.

The Virginia Nonstock Corporation Act, specifically under Chapter 10.1 of Title 13.1 of the Code of Virginia, governs the operation of nonprofit corporations. A critical aspect of this act relates to the dissolution of such entities. When a Virginia nonprofit corporation dissolves, its assets, after satisfying all liabilities and obligations, must be distributed in accordance with its articles of incorporation, bylaws, or a plan of dissolution approved by the members. Crucially, if the articles of incorporation or bylaws do not specify a recipient for the remaining assets, or if such a provision is ineffective, the assets must be distributed to one or more domestic or foreign corporations, societies, or organizations engaged in activities substantially similar to those of the dissolving corporation, as determined by the circuit court in the county or city in which the corporation had its principal office. This ensures that the charitable or public purpose for which the nonprofit was established is continued. Failure to adhere to these distribution requirements can lead to legal challenges and potential reversion of assets to the state. The specific language in the Code of Virginia § 13.1-1051 outlines this process, emphasizing the court’s role in determining the appropriate recipient if the governing documents are silent or inadequate.

The Virginia Nonstock Corporation Act, codified in the Code of Virginia, outlines the procedures for amending articles of incorporation for nonprofit corporations. Specifically, Virginia Code § 13.1-900 addresses the amendment of articles of incorporation. For a nonprofit corporation, amendments generally require approval by the board of directors and, in most cases, a subsequent vote by the members. The Act specifies that unless the articles of incorporation provide otherwise, a proposed amendment must first be approved by the board of directors. Following board approval, the amendment must be submitted to the members for adoption. The required member vote for adoption is typically a majority of the votes cast by members entitled to vote thereon, unless the articles of incorporation or bylaws specify a higher voting threshold. This dual approval process ensures both the governing body and the membership have a say in fundamental changes to the corporation’s structure and purpose. The question hinges on identifying the minimum procedural steps required by Virginia law for such an amendment, assuming no specific provisions in the articles or bylaws alter these default requirements. Therefore, the correct sequence involves board approval followed by member approval.

The scenario presented involves a Virginia nonprofit corporation, “Coastal Heritage Preservation Society,” facing a potential conflict of interest. The Virginia Code, specifically Title 13.1, Chapter 10 (Virginia Nonstock Corporation Act), governs nonprofit corporations. While the Act itself doesn’t detail specific conflict of interest procedures, it mandates that corporations act in accordance with their articles of incorporation, bylaws, and applicable laws. Best practices and common law principles, often reflected in organizational bylaws, require directors to act in the best interest of the corporation and avoid self-dealing. When a director has a material financial interest in a transaction, the corporation’s bylaws typically outline a process for disclosure and approval. This process usually involves the interested director disclosing their interest to the board, recusing themselves from discussions and voting on the matter, and the transaction being approved by a majority of the disinterested directors. In this case, the proposed lease agreement between the society and the director’s real estate firm presents a direct financial interest. To ensure compliance with fiduciary duties and to maintain good governance, the director must disclose their interest. The board, excluding the interested director, must then review and approve the lease. This ensures that the decision is made solely in the best interest of the Coastal Heritage Preservation Society, free from the influence of personal gain. The Virginia Code, while not explicitly detailing conflict of interest remedies for nonprofits, empowers the circuit courts to address corporate misconduct, including breaches of fiduciary duty, which could arise from unmanaged conflicts of interest. Therefore, the immediate and essential step for the director is to disclose their material financial interest to the board of directors.

The Virginia Nonstock Corporation Act, which governs nonprofit corporations in Virginia, outlines specific requirements for the dissolution of such entities. A voluntary dissolution process typically involves a resolution by the board of directors and, often, approval by the members. Section 13.1-907 of the Code of Virginia details the procedure for a voluntary dissolution initiated by the corporation itself. This section mandates that the board of directors adopt a resolution recommending dissolution, which is then submitted to the members for a vote. For corporations with members, the dissolution requires approval by a majority of all votes entitled to be cast by members present at a meeting where a quorum is present, or by a majority of all votes entitled to be cast by members if the vote is by written consent. If the corporation has no members, or if no members are entitled to vote on dissolution, the board of directors may adopt the resolution by a majority vote of all directors. Following the member or board approval, articles of dissolution must be filed with the Virginia State Corporation Commission. This process ensures that the decision to dissolve is properly authorized and documented, safeguarding the interests of members and creditors.

The Virginia Nonstock Corporation Act, which governs nonprofit corporations in Virginia, outlines specific requirements for the dissolution of such entities. When a nonprofit corporation in Virginia decides to dissolve, it must follow a prescribed process to ensure its affairs are properly wound up and its assets are distributed according to law and its own governing documents. This process typically involves a resolution by the board of directors, followed by a vote of the members or shareholders, depending on the corporation’s structure. Once the dissolution is approved, the corporation must cease conducting its business except as necessary to wind up its affairs. This winding up includes collecting assets, paying debts and liabilities, and distributing any remaining assets. Virginia Code § 13.1-907 specifies that after paying or making provision for all claims, any remaining assets shall be distributed to one or more domestic or foreign corporations or organizations that are exempt from taxation under Section 501(c)(3) of the Internal Revenue Code, or to a governmental entity for a public purpose, or to any other person or entity as permitted by the articles of incorporation or bylaws. The key is that distribution must be to an organization with a similar purpose or for a public benefit, preventing private inurement. The filing of articles of dissolution with the State Corporation Commission is the final step that legally terminates the corporation’s existence.

The Virginia Nonstock Corporation Act, which governs nonprofit corporations in Virginia, outlines specific requirements for the dissolution of such entities. When a nonprofit corporation is dissolved, its assets must be distributed in accordance with its articles of incorporation, bylaws, and applicable law. For a public benefit corporation or a religious corporation, Virginia law mandates that any remaining assets after the satisfaction of debts and liabilities must be distributed to one or more qualified organizations engaged in activities substantially similar to those of the dissolving corporation, or to another organization designated by a court for charitable purposes. This ensures that the charitable purpose for which the corporation was established continues to be served. The Act does not permit the distribution of assets to members, directors, or officers, as these entities are not organized for private gain. Therefore, the distribution of remaining assets to a local historical society that shares a similar community-focused mission, and which is itself a qualified nonprofit organization, aligns with the statutory requirements for the winding up of a dissolved Virginia nonprofit corporation.

The Virginia Nonstock Corporation Act, specifically referencing Virginia Code § 13.1-801 et seq., governs the formation and operation of nonprofit corporations in Virginia. A fundamental aspect of this act pertains to the powers and limitations of such entities, particularly concerning their ability to engage in activities that might benefit private individuals or entities. Virginia Code § 13.1-820 outlines the general powers of a nonprofit corporation, including the power to make donations for public welfare or for charitable, scientific, or educational purposes. However, the core principle of nonprofit governance in Virginia, as in most jurisdictions, is that the organization’s activities and assets must be dedicated to its stated public or charitable purpose and not to the private benefit of its members, directors, or officers. This prohibition against private inurement is a cornerstone of tax-exempt status under federal law (Internal Revenue Code Section 501(c)(3)) and is also implicitly or explicitly embedded within state nonprofit corporation statutes. Therefore, a Virginia nonprofit corporation cannot lawfully use its funds to provide substantial personal financial benefits or compensation that exceeds reasonable market value for services rendered to individuals who are in a position to influence the organization, such as directors or officers, without clear and compelling justification tied to the organization’s mission and compliant with applicable conflict-of-interest policies and disclosure requirements. Engaging in such transactions would violate the principle of dedicating assets to public benefit and could jeopardize the organization’s tax-exempt status and legal standing.

The Virginia Nonstock Corporation Act, specifically referencing Virginia Code § 13.1-801 et seq., governs the formation and operation of nonprofit corporations in the Commonwealth of Virginia. A critical aspect of this act pertains to the dissolution of such entities. When a Virginia nonprofit corporation dissolves, its assets, after the satisfaction of all debts and liabilities, must be distributed according to the corporation’s articles of incorporation or bylaws. If neither document specifies a particular recipient for the remaining assets, the Virginia Nonstock Corporation Act mandates that these assets must be distributed to one or more domestic or foreign corporations or entities that are organized and operated exclusively for charitable, religious, or eleemosynary purposes, as specified in the articles of incorporation or as determined by the circuit court of the county or city in which the principal office of the corporation is located. This provision ensures that the residual assets of a dissolved nonprofit continue to serve a public or charitable purpose, aligning with the original intent of establishing a nonprofit organization. The process involves liquidating assets, paying creditors, and then distributing the remaining balance in accordance with the governing documents or, failing that, through a court-directed charitable distribution. This mechanism prevents private inurement and ensures that the public benefit mission is upheld even after the organization ceases to operate.