REGULATING THE ACTIVITY OF NATIONAL CANDIDATES FOR NATIONAL OFFICE

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5 POLICY STATEMENT 1.1 THE NATIONAL EXCHANGE CLUB REGULATING THE ACTIVITY OF NATIONAL CANDIDATES FOR NATIONAL OFFICE RESOLVED that it be the Policy of the Board of Directors of The National Exchange Club that the following guidelines will apply to the conduct of political campaigns for National office: That no Exchange Club, District, Region or Exchange member may allocate funds for the sole purpose of advancing the candidacy of any person for election to a National Office or as a Member of the Board of Directors of The National Exchange Club. That in the allocation of Club, District or Regional funds, they are to be used for their National Convention attendees, and that such be limited to travel, hotel, hospitality suites and meal reimbursement. That at the National Convention, use of banners, posters, photographs, brochures, cards, letters or other printed or written materials, electronic media, pens, or other materials showing the name or theme of any candidate to promote his/her candidacy for office, be restricted to any private hotel room or any hospitality suite. Campaign pins, buttons and badges may be given out by anyone in any hospitality suite or personal hotel room of the convention hotel. A candidate may personally give out his or her campaign pins, buttons and/or badges anywhere except in the room where polling and tallying will take place. The wearing of pins, buttons and badges, showing the name or the theme of a candidate by anyone, is permitted. However, no member of the, Elections Committee, Tellers, or staff may wear any candidate s pin, button, badge, nor anything with a candidate s name or theme in the room when voting and tallying takes place. Under no circumstances may material be displayed in public space at the convention hotel(s) and/or facilities, or placed on tables or chairs at any convention events. That a copy of this Resolution be transmitted to the President and Secretary of each Exchange Club, to all National and District Officers and Directors, and to each candidate seeking election to any National Office. Violations of this Policy will be reported to the Chairman of the National Committee on Elections, and the person responsible will be given a hearing before the Elections Committee Chairman, the National President, and the Immediate Past National President. That Committee will then recommend the disciplinary action, if necessary, to the. Amended: Jacksonville, Florida, January 10, 2009 Detroit, Michigan, July 6,

6 PROPOSED POLICY STATEMENT 1.1a THE NATIONAL EXCHANGE CLUB REGULATING CANDIDATE SPEECHES DURING NATIONAL CONVENTION In consideration of candidate speeches at the National Convention, the following procedures will apply: Election Procedure Candidates for Regional Vice-President, National Treasurer, National President-Elect and Foundation Trustees in contested races will be allowed to make a five (5) minute speech to the convention delegates at the appropriate time in the election process. They will be timed and told when one minutes is left (the yellow light), when 30 seconds are left (the red light) and when time is up (the buzzer will sound.) The Elections Committee shall be responsible for enforcing the time limit. Only registered delegates who hold membership in the regions with contested races are eligible to vote for these candidates. Candidates who are nominated for a National office with no opposition will be given one (1) minute to introduce themselves to the Convention delegates. The election procedure will be established by Convention Rules. The election will be conducted by the Election Committee. Toledo, Ohio, September 29,

7 POLICY STATEMENT 1.3 THE NATIONAL EXCHANGE CLUB REQUIREMENTS FOR NATIONAL NOMINATIONS FOR NATIONAL CANDIDATES RESOLVED that the National Bylaws set out certain requirements for those interested parties wanting to run for the National Office positions of The National Exchange Club. By meeting these deadlines and requirements, each candidate will receive certain publicity and consideration prior to the National Convention. BE IT RESOLVED that the National Board will publicize these requirements so that all interested parties may be fully aware of the requirements for national nominations. The nominating requirements will be published in Exchange Today, discussed by the National Board at its Midwinter meeting and disseminated to the Districts prior to the 120-day filing deadline. 7

8 POLICY STATEMENT 1.4 THE NATIONAL EXCHANGE CLUB MAILING ADDRESS REQUESTS FOR NATIONAL CANDIDATES WHEREAS, it is the desire of many suggested candidates for National Office that they be provided, by National Headquarters, with the names and addresses of Exchangites, prior to Annual Conventions of The National Exchange Club, at which they will be candidates for National Office; BE IT, THEREFORE, RESOLVED, that the Executive Vice-President of The National Exchange Club be authorized to provide Exchangites' names and addresses, and/or mailing labels, to suggested candidates for National Office, on request, with the following stipulations: 1. That the released names are to be limited to Exchange Club Officers and District Officers and Directors in the Region or Regions to be represented by the candidate; or, names of those individuals, within the Region or Regions to be represented by the candidate, who have registered for the National Convention as of the early registration deadline; and 2. That the information received by the candidate is to be used for the purpose of only one election campaign; and 3. That the information received is not to be copied; and 4. That if lists and not labels are provided the candidate, such lists are to be returned to the Executive Vice-President upon request. 5. That the charge for pressure-sensitive mailing labels shall be paid by the candidate submitting the request to National Headquarters. 6. No provision of this policy or implementation thereof shall conflict with federal or any state legislation pertaining to privacy and confidentiality. Amended: Louisville, Kentucky, October 3, 1987 Birmingham, Alabama, July 16, 2003 Dallas, Texas, January 17,

9 POLICY STATEMENT 1.5 THE NATIONAL EXCHANGE CLUB PAID ELECTION ADVERTISING IN NATIONAL EXCHANGE PUBLICATIONS Paid election advertising on behalf of any candidate(s) for any elective office in The National Exchange Club, will not be accepted or published in any National Exchange Club publication, including Exchange Today, the official publication of The National Exchange Club. This policy is applicable to any candidate for election to any office within or outside of The National Exchange Club. New Orleans, Louisiana, January 11,

10 POLICY STATEMENT 1.6 THE NATIONAL EXCHANGE CLUB CONVENTIONS OF THE NATIONAL EXCHANGE CLUB WHEREAS, the Bylaws of The National Exchange Club provide that the supervision and management of the National Conventions of The National Exchange Club shall be vested in the Board of Directors; and WHEREAS, it is customary for the Executive Vice President to be charged with the responsibility of receiving and evaluating convention invitations and recommending convention sites to the National Board of Directors; and WHEREAS, a District of Exchange may be designated as host to a National Convention of The National Exchange Club for the purpose of providing personnel needed in the handling of such events as are designated by The National Exchange Club; and WHEREAS, convention site selection is a complex process deserving the same attention given other aspects of the business management of The National Exchange Club; NOW, THEREFORE, BE IT RESOLVED that, 1. The Board of Directors of The National Exchange Club affirm that the executive management and direction of the National Convention be under its control and supervision. 2. No individual Club(s), Officer, or member thereof, or District of Exchange Clubs or Officer thereof, in any manner, be authorized or be permitted to assume supervision, management or control of any phase of National Convention planning or programming without the written consent and/or approval of the of The National Exchange Club. 3. The National Convention of The National Exchange Club shall be held in the third week in July, or at such other time during the month of July or August as shall be approved by the National Board of Directors. 4. During the Mid-Year Conference each year, the Executive Vice-President shall inform all District Presidents that convention sites are being considered for (include the appropriate year). Any districts interested in hosting the next scheduled convention should notify the Executive Vice-President by the deadline date of April 15. The location shall then be checked to ensure the city and hotel meets the minimum qualifications set by the. Once the site inspection has been made, a report will then be made to the Board at its Mid-Year meeting of the city and hotel location which best suits the criteria. 5. The selection of the city in which the National Convention of The National Exchange Club is to be held shall be made by the not later than its Mid-Year meeting in the third year before said convention, and only after investigation of facilities has been made by the Executive Vice- President and/or professional staff employed by The National Exchange Club. 6. Sites may be cities with or without Exchange Clubs. No site, however, shall be considered if a National Convention has been held in that location within five (5) years of the year being considered for the convention. 10

11 7. A proposed convention site must have a minimum of 400 guestrooms, which can be reserved exclusively for the convention. To be considered, the hotel must be in operation. Properties proposed, or under construction, cannot be considered. 8. The hotel must have a room, which can seat up to 800 for Meal Events; and, have at least 12 breakout rooms. 9. Air transportation, by regularly scheduled carriers, should be available to the convention city. If airlines do not provide service directly to the convention city, such information must be provided. 10. The convention city must offer attractions for convention attendees, including good restaurants and shopping areas easily reached. 11. The following procedures must be followed in the selection of a city in which a National Convention of The National Exchange Club will be held: The Executive Vice President will report invitations received, and recommend action thereon, to the ; The Executive Vice President will report proposed convention city, or cities, to be surveyed by staff; and The inspection report(s) prepared by staff will be presented, through the Executive Vice President, to the, and the selection of the convention city be made by the National Board of Directors. The site visitation should investigate the following items, which could affect the cost of those attending the convention: 1) Airfare to each potential site from at least ten cities, which would require delegates to fly to the convention. 2) Taxes (City, State and Hotel) 3) Gratuities (and whether or not they are taxable) 4) Ground transportation to and from the convention city airport 5) Potential hotel accommodation costs 6) Potential cost of parking 7) Potential food and beverage costs 8) Potential audio-visual costs 9) Area attractions 10) Pre and Post convention vacation potential 11) Safety and security 12. The Executive Committee of the shall be informed of the detailed convention budget. 13. Following a National Convention, the Executive Vice-President shall be given the opportunity to review the Post-Convention Surveys, noting comments where appropriate. Responses to the Post-Convention Surveys shall be handled by the Director of Meeting Planning. 14. The First Timers' Event shall be placed as a convention agenda item. The shall be required to attend this event. 11

12 15. Information pertaining to appropriate attire at National Convention events shall be included in prior mailings to registered Exchangites and shall be added to the Official Convention Program booklet. Amended: Toledo, Ohio, September 22, 1990 Atlanta, Georgia, July 26, 1992 Nashville, Tennessee, July 19, 1995 Toledo, Ohio, September 23, 2000 Dallas, Texas, January 17, 2004 Salt Lake City, Utah, July 17, 2005 Toledo, Ohio, October 17, 2009 New Orleans, Louisiana, July 9,

13 POLICY STATEMENT 1.7 THE NATIONAL EXCHANGE CLUB SUPERVISION AND MANAGEMENT OF CONVENTIONS BY THE NATIONAL BOARD OF DIRECTORS The Bylaws of The National Exchange Club provide that the Board of Directors shall have full supervision and management of all conventions of The National Exchange Club. In its management role, the Board considers and approves the budget for the annual national convention, a line item included in the annual operating budget of The National Exchange Club. It is the intent of the Board that the annual national convention be fully funded by Constitutional payments, which constitute registration fees, and by income produced by the sale of Convention All-Events Packages and individual tickets. Following convention budget approval, the Executive Committee of the Board of Directors acting in place and stead of the Board of Directors between Board meetings, is authorized to approve and allow for unexpected and/or additional costs and expenses in excess of the total amount budgeted for the convention and encountered prior to or during the convention. Seattle, Washington, July 11,

14 POLICY STATEMENT 1.8 THE NATIONAL EXCHANGE CLUB NATIONAL CONVENTION HOST RESPONSIBILITY To promote Convention attendance from member Clubs within the Host's District. To provide the personnel for Convention Operating Committee. To complement with fellowship and hospitality the Convention Program. The Convention Program is developed and executed by The National Exchange Club, and any hospitality or other convention-related event planned by the Host Clubs, must be approved by The National Exchange Club. The host is to assume no financial responsibility other than the minimal amount it may budget for the operation of hospitality headquarters. CONVENTION EXECUTIVE COMMITTEE This Committee gives general supervision and direction to the several Convention Operating Committees. The Chairman of the Executive Committee is the direct liaison between the Host and The National Exchange Club. Normally, the Convention Executive Committee is appointed by the Host District President. CONVENTION OPERATING COMMITTEES The Chairman of the Convention Committee may appoint the personnel of the Convention Operating Committees, designating a Chairman for each. Due to the nature of their responsibilities, members of the Convention Operating Committees are to be selected from the Host Clubs on the basis of ability and experience. The following Committees should be appointed: Distinguished Guests Hospitality Publicity Distinguished Guests (Reception and Transportation) To meet and greet the distinguished guests of the Convention; to provide for their comfort; to, on behalf of the Convention, extend hospitality to them; and to assist them in maintaining their schedules and to meet transportation requirements (as necessary.) As a courtesy, transportation to and from the airport should be provided by the Committee for the following groups: 1. Executive Officers 2. Other Members of the and NEC Foundation Board of Trustees 3. Staff 14

15 4. Convention entertainers and speakers, if required 5. Past National Presidents. The members of this Committee should be in constant attendance at the Convention. It is suggested that Committee members be especially congenial hosts. It will be very helpful if Committee members have their automobiles available during the days of the Convention. Hospitality To greet and welcome all delegates and visitors and their families upon arrival in the Convention City, and at all times to be of assistance to all Convention attendees; and, to staff and operate Hospitality Headquarters for the duration of the Convention. A Hospitality table will be provided by The National Exchange Club. Those appointed to this Committee should be familiar with the Convention City to give directions to shopping malls, dining, etc. Publicity Responsible for Convention publicity and promotion of Convention attendance from throughout the District in advance of the Convention, and publicity during the Convention. The Chairman of this Committee should be a qualified public relations person. The Convention publicity/promotional efforts of the Committee will complement the publicity/promotional activities of The National Exchange Club. There should be a combined effort to promote Convention attendance and to gain the best media coverage prior to and during the Convention. Publicity kits will be provided by The National Exchange Club. Amended: Seattle, Washington, July 11, 1982 Atlanta, Georgia, July 26, 1992 La Quinta, California, January

16 POLICY STATEMENT 1.9 THE NATIONAL EXCHANGE CLUB NATIONAL CONVENTION EXPENSE ALLOWANCE RESOLVED that the following expense allowance shall prevail for the National Officers and other Members of the Board of Directors: The actual coach air fare to and from the Convention by the most direct route, payable between the city or place in which the Convention is held and the city or place in which such member has his residence; transportation to and from airports; airport parking fees; or mileage at the current auto expense rate, if travel is by private auto; plus complimentary Convention All-Events Package. When traveling by private auto, and the mileage auto expense rate exceeds the coach airfare, the amount to be reimbursed the member shall be the best airfare available. RESOLVED FURTHER that hotel rooms be provided each Member of the National Board attending the Convention as prescribed by the. RESOLVED FURTHER that the complimentary All-Events Package be provided the spouse of each National Officer and other Members of the Board of Directors in attendance at the National Convention. RESOLVED FURTHER that a complimentary Convention All-Events Package be provided to the most recent five (5) Past National Presidents. RESOLVED FINALLY that all meal expenses incurred after the start of the Pre-Convention National Board of Directors Meeting and ending with the Post-Convention Meeting shall not be reimbursed. Amended: Hershey, Pennsylvania, September 6, 1986 Louisville, Kentucky, October 3, 1987 Toledo, Ohio, September 13, 2003 Detroit, Michigan, October 12,

17 POLICY STATEMENT 1.10 THE NATIONAL EXCHANGE CLUB LIMITING SALES AT ANNUAL CONVENTIONS RESOLVED that only items supplied by The National Exchange Club, or listed in its official supplies catalog, may be displayed, offered for sale, or sold at convention registration headquarters or in other public space areas at annual conventions of The National Exchange Club, except for sales by convention sponsors of National Convention events, or other special activities as approved by the ; and RESOLVED FURTHER that no individual Exchangite, Exchange Club, District of Exchange Clubs, or other person, business or agency of any kind (excepting approved convention sponsors as set forth in the preceding paragraph), may display or sell saleable items at convention registration headquarters or in other public space areas at annual conventions of The National Exchange Club, or distribute sales promotional literature or order forms to convention attendees pertaining to any saleable item or to a fund-raising project or activity. RESOLVED FURTHER that clubs and districts attending the National Convention are permitted to post messages/posters (not to exceed 8-1/2 x 11 inches) on the message bulletin board in the convention registration area to advertise a fundraiser. The fundraiser itself must be conducted within a hospitality suite during the Convention. The promoting or selling of tickets, chances, etc., in association with a fundraiser is prohibited in meeting rooms, hallways, dining areas, or on the floor of the Convention. Amended: Hershey, Pennsylvania, September 6, 1986 Nashville, Tennessee, July 19, 1995 St. Louis, Missouri, January 12,

18 POLICY STATEMENT 1.11 THE NATIONAL EXCHANGE CLUB RESOLUTIONS COMMITTEE GUIDELINES FOR THE CHAIRMAN AND OTHER MEMBERS OF THE NATIONAL CONVENTION COMMITTEE ON RESOLUTIONS Legislation by The National Exchange Club is enacted through Resolutions that are adopted at the Annual Convention. All Resolutions presented to the Convention are referred to the Convention Committee on Resolutions. Resolutions, in original or amended form, are taken to the floor of the Convention by the Committee, or they may be disregarded altogether when the judgment of the Committee so dictates. It is important that the Committee be aware of regulations pertaining to Resolutions that The National Exchange Club may consider: Please observe that -- No Resolution presented to the Convention should call upon local Exchange Clubs, Districts of chartered Exchange Clubs, or any individual, or committee, or agency of The National Exchange Club, to influence legislation through Resolution, or communication, addressed to United States Senators, United States Representatives in the House, members of state legislatures, or county or municipal legislative bodies. The National Exchange Club, under the Revenue Act of 1936, may not influence or attempt to influence legislation. The National Exchange Club is not a social service club organization in any sense of the term. No Resolution, therefore, should call upon any organization within or outside of its operative structure to adopt or formulate policies that might be interpreted as affecting social service or social welfare activities -- local, state, or national in their scope. No Resolution endorsing or promoting the activities of any organization, outside of The National Exchange Club itself, should be presented to the Convention for adoption, which Resolutions might subject The National Exchange Club to the charge of promoting or carrying on propaganda, either directly or indirectly. Propaganda activity by a non-profit, educational organization is not permitted by Federal law. No Resolution, which directs or attempts to control the activities of local Exchange Clubs, or their individual members, should be presented to the Convention for adoption. No Resolution proposing new objectives or activities for The National Exchange Club should be presented to the Convention for adoption, unless the same shall have been passed upon or originated by the Board of Directors of The National Exchange Club. The Committee on Resolutions should be alert, so as to prevent attempts that may be made by influences, either within or outside of The National Exchange Club, to capitalize upon or make use of The National Exchange Club influence. No Resolution, which might be interpreted as favoring any political candidate or party, or platform of a political party, or the approving or the disapproving of political campaign issues, should be presented to the Convention for adoption. It should be kept in mind by the Committee on Resolutions that The National Exchange Club is organized and operated exclusively for educational purposes, within the limitations imposed upon such organi- 18

19 zations by the Revenue Act of 1936, as it was enacted or later amended; further, that The National Exchange Club itself performs no physical acts of service, its field of activity being solely that of an educational nature. No Resolution should be presented that may involve the use of copyrighted rules, trademarked designs, or patented games of any kind such as might be manufactured or sold by a company, or an individual. The National Exchange Club cannot endorse games for children or adults, as the case may be, which are privately owned and controlled. Any Resolution designed to enlist or participate in the activities of other organizations, or to join The National Exchange Club or local Exchange Clubs in an activity with other groups participating, would be out of order. Consideration may be given only to those activities, which bear the Exchange Club "label"; that is, those, which are Exchange Club originated, and all plans relating thereto being wholly within the control of The National Exchange Club. 19

20 POLICY STATEMENT 2.1 THE NATIONAL EXCHANGE CLUB THE NATIONAL EXCHANGE CLUB'S BOARD OF DIRECTORS RESPONSIBILITIES, EXPENSE REIMBURSEMENT AND ASSIGNMENTS RESPONSIBILITIES The All Members of the have the responsibilities during the administrative year to: 1. Attend all meetings of the. 2. Participate in the decision-making process at Board meetings, working in concert with other Members of the to help formulate programs in the best interest of The National Exchange Club, Districts of Exchange Clubs and local Exchange Clubs. 3. Determine and establish policies for the membership, clubs and districts of The National Exchange Club; consider changes and interpret as a board, when necessary, the Bylaws of Clubs, Districts and The National Exchange Club; protect the rights of its membership; actively promote its purposes and supervise the disbursement of the funds of The National Exchange Club through the budget adopted annually. 4. Subordinate individual and club/district interests for the good of Exchange as a national organization. 5. Consider oral or written statements carefully because your remarks may be taken as official policy by club members and others. 6. Accept all assignments that result from action taken at board meetings, and support the policies and programs adopted by the board. 7. Approve, establish, prioritize, and evaluate the Programs of Service of The National Exchange Club, being certain they serve the objectives and purposes of Exchange. 8. Be knowledgeable of the purposes, background, methods and techniques used in new club sponsorship, membership expansion and retention, the Leadership Training Program, the National Programs of Service, and National Awards Program, in order to answer questions and conduct discussion groups whenever possible. 9. Be aware on every assignment of the need to meet with additional groups of Exchangites over and above the primary assignment. 10. Be, at all times, accessible and responsive to the needs of any Exchange member who has questions, suggestions or criticisms to offer, insuring any promise of action or reply is carried out, with report being made back to the initiator of the request. 11. By your conduct and deportment, set an example of the values, morals, and ethics befitting a national leader of an organization that espouses those virtues. 20

21 National President In addition to your responsibilities on the, your additional responsibilities during the administrative year are to: 1. Represent The National Exchange Club with honor and dignity as head of our national organization at any public affair. 2. Call and preside at all meetings of the of The National Exchange Club, the Executive Committee, and the National Convention. 3. Issue authority for new Exchange Clubs to organize. 4. Select and assign, in consultation with the Executive Vice-President, National Officers and Directors to attend and participate in regional, district and club functions. 5. Appoint, at or before the National Convention, a Credentials Committee, a Committee on Elections, and a Committee on Resolutions; and designate the Chairman of each. Appoint tellers, as necessary, prior to the voting session at the Annual Convention. 6. Appoint a National Committee on Jurisprudence and Laws at the first of the administrative year, consisting of at least three (3) Exchangites, the Chairman of which must be a Past National President. 7. Appoint such other committees as the Bylaws of The National Exchange Club call for, and designate the chairman of each. 8. Provide leadership for the attainment of the goals and accomplish the objectives of The National Exchange Club. National President-Elect In addition to your responsibilities on the, your additional responsibilities during the administrative year are to: 1. Perform such duties as are assigned to you by the National President, and by the National Board of Directors. 2. Plan for your year as National President. 3. Preside, in the absence of the National President, at any and all meetings where the National President would normally preside. 4. Be prepared in the event of inability of the National President to perform some or all of his duties; you shall perform these duties and have, in connection therewith, the authority of the National President. 5. Serve on the Executive Committee. 21

22 National Treasurer In addition to your responsibilities on the, your additional responsibilities during the administrative year are to: 1. Perform such duties as are assigned to you by the National President and by the National Board of Directors. 2. Present a report at the Annual Convention of The National Exchange Club and at such other times as the National President or the may require. 3. Give bond for the faithful discharge of your duties in a sum and with sureties as required by the National Board of Directors. 4. Serve on the Executive Committee. 5. Serve as the Chairman of the Budget and Finance Committee. Immediate Past National President As Immediate Past National President, your responsibilities during the administrative year are to: 1. Perform such duties as are assigned to you by the National President and by the National Board of Directors. 2. Serve on the Executive Committee. 3. Provide insight and wisdom to the National President on any issue deemed appropriate. Regional Vice-President In addition to your responsibilities on the, it is the responsibility of the Regional Vice-President during the administrative year to: 1. Communicate monthly by telephone and mail with each District President in his/her region, and submit a monthly report to The National Exchange Club and the National President, indicating activities and progress made in your region during the preceding thirty (30) days. 2. Assist each District President-Elect in the development of district new club and membership goals prior to the beginning of his/her term as District President. 3. Assist each district in identifying, cultivating and training individuals for leadership positions at the district level prior to the next convention of the district. 4. Assist each District President-Elect in identifying candidates to serve as members of the district leadership team for the year in which he/she will be the District President. 5. Assist each District Board of Directors in his/her region in establishing short (one to three years) and long (three to five years) range growth goals. Communicate these goals to the National President, National President-Elect and Executive Vice-President. Update these goals as necessary, but not less than annually. 22

23 6. Plan and work with District Presidents under your jurisdiction to discuss, inspire, and motivate in the following areas: New Club Building -- Work with District Presidents to establish and attain club building goals. Membership Expansion -- Assist in the continuing effort to gain new members, utilizing special campaigns, awards, etc. Future Leadership -- Work with districts to cultivate and recruit a consistent succession of qualified, trained leaders at all levels of Exchange. Strengthen Clubs -- Seek the establishment of a goal in each district to bring all clubs up to standard. Competition -- Promote competition for the attainment of goals by District Presidents. EXPENSE REIMBURSEMENT Expense Reports All expenses must be submitted in writing on a National Exchange Club Expense form. Expenses must be itemized, and all receipts and explanations attached. Expense reports must be filed no later than 30 days following the completion of the trip or of incurring the expense. Expense reports must be submitted by July 10 th for the previous fiscal year. Expenses submitted for reimbursement later than 60 days after being incurred or after July 10 th will not be reimbursed. A check for reimbursement will normally be issued within fifteen (15) working days of receipt of report. Expense reports should be mailed directly to the Director of Finance at The National Exchange Club. Expense Approval The National Treasurer, in concert with the National President, shall approve all travel and related expenses that fall within budget. The Executive Vice-President's expenses shall be approved by the National Treasurer in conjunction with the National President, and the National Treasurer's expenses shall be approved by the National President. Expense statements over the budget or prescribed limits or deadlines must be approved by the National President. Credit Cards The National Exchange Club may pay for one credit card fee per year for frequent travelers, at the discretion of the National Treasurer, in concert with the National President. Meal Expenses For meals not provided by a host region, district or club, the reimbursable amount per day is $50.00 using $10.00 for breakfast, $15.00 for lunch, and $25.00 for dinner, as a guideline. The daily meal reimbursement is $25.00 for arrival and departure days, unless the Executive Vice President or National Treasurer approves $ Miscellaneous Expenses Automobile travel for volunteers is computed at 50% of the IRS rate for employees. Adjustments to coincide with the IRS rate will be made as necessary. Reimbursement is computed using the most direct route, and is limited to the lesser of the mileage rate or the airfare, as described below. Tolls, parking and other charges are also reimbursable. 23

24 Air travel should be at the best discount rate, as computed by the official travel agency of The National Exchange Club, and using the master billing account. Accordingly, all air travel paid by The National Exchange Club must be billed through the official travel agency. The single occupancy rate should be utilized for hotel/motel accommodations not provided by a host region, district or club. National Convention All-Events Packages will be provided for board members and spouses. Discretionary Expense Allowance Each member of the shall have an annual allowance for administrative expenses and travel other than official assignments. Discretionary expense allowances for Officers and Regional Vice Presidents are reflected in the current budgetary allocations. Expense Allowance for National President and National President-Elect The National President and National President-Elect are entitled to receive reimbursement for the following expenses for them and their spouses, incurred when traveling for The National Exchange Club. Said expenses must be promptly and properly reported to the National Treasurer, using the form provided with documentation, as follows: 1. Automobile travel for volunteers is computed at 50% of the IRS rate for employees. Adjustments to coincide with the IRS rate will be made as necessary. Reimbursement is computed using the most direct route, and is limited to the lesser of the mileage rate or the airfare, as described below. Tolls, parking and other charges are also reimbursable. 2. Air travel at the best discount rate, as computed by the official travel agency of The National Exchange Club, and using the master billing account. 3. Single/Double occupancy rate for hotel/motel accommodations not provided by a host region, district or club. 4. At the National Convention, a suite will be provided at the headquarters hotel for the National President and his/her spouse. 5. National Convention All-Events Packages will be provided. Non-Reimbursable Travel Expenses 1. The following expenses will not be reimbursed: 1. Personal entertainment 2. Fines for parking/traffic violations 3. Charges for alcoholic beverages 4. Other expenses of a personal nature. 5. Items for which no monetary expenditure was made. ASSIGNMENT OF NATIONAL REPRESENTATIVES It shall be the policy of The National Exchange Club to assign members of Board of Directors as National Exchange Club Representatives. These assigned representatives are, within budget limitations, charged to advance the mission and goals of The National Exchange Club as they relate to the specific circumstances of the assignment. 24

25 At the completion of an assignment, the representatives are required to submit an Assignment Report to the Executive Vice-President, with a copy to the National President. This report must accompany the Expense Reimbursement Report before the Executive Vice-President can approve the request for reimbursement (forward to the National Treasurer for approval). The National President, in consultation with the Executive Vice-President, shall make all assignments of national representatives, which would include National Officers and Directors (Regional Vice Presidents), Past National Presidents and the Executive Vice President, giving consideration to the benefits to The National Exchange Club and its Clubs, and the costs to be incurred in achieving those benefits. Representatives shall be assigned using the following guidelines: 1. Clubs celebrating anniversaries, beginning with the 25th (and on subsequent 5-year anniversaries) may request an assigned National Representative for a special function. The National President or President- Elect may be specifically requested by a Club having a 50th or greater anniversary. Generally, National Officers, Regional Vice-Presidents, or Past National Presidents, nearest geographically, will be assigned. 2. District Conventions should have a National Representative in attendance and participating in the Convention. The National President will assign Representatives at his or her discretion making the decision based on district needs, avoidance of repeat appearances, and avoiding conflict with the National Representative's home District Convention where possible. 3. Exchange clubs, districts or regions will be expected to cover transfer, food and lodging expenses while the representative is at the site of the convention, conference or meeting. If a second National Representative is requested (other than their own Regional Vice President), the club, district or region will be responsible for all expenses above, plus transportation. 4. National Officers, within budget limits, may represent The National Exchange Club at activities, both within and outside the organization, which will serve to advance the mission and goals of The National Exchange Club. 5. Travel expense will only be paid for one Regional Vice-President to attend any District Convention or Educational Conference. When a member of the Executive Committee is the assigned representative, the Regional Vice-President for that region may attend those functions and can be reimbursed for travel expenses, the Regional Vice President s budget permitting; or, may attend at his/her own expense, except when the function is held within his/her own district. The Regional Vice President may also attend those functions at his/her own expense. Should the Regional Vice-President be unable to attend, only one National Representative shall be assigned and reimbursed. Regional Vice-Presidents should not be assigned to their own District Conventions. Whenever possible, a member of the Executive Committee shall be assigned to the home district of a Regional Vice-President. PROTOCOL Whenever a National Representative is assigned to attend a club, district or regional function, activity, conference or convention, the host club, district or region will be responsible for the payment of the expenses of the National Representative and his/her spouse (if attending) while in the area; such expenses to include: 1. Meals 3. Package Cost 2. Lodging 4. Local Transportation (taxi, parking fees, etc.) 25

26 Said expenses will cover the full period of the assignment from the time of arrival to the time of departure. Travel and transportation expenses for the National Representative to and from the area will be borne by The National Exchange Club. Requests for assignment of a National Representative to any special club, district or regional function, activity, conference or convention must first be addressed to the Executive Vice-President of The National Exchange Club, who will then consult with the National President for a final decision. Generally, such decisions will be made far enough in advance to arrange for adequate publicity, etc.; but, not too far in advance so that proper scheduling can be effected. In no case, should any member of the or any Past National President be approached directly concerning their appearance at a special function, activity, conference or convention, without first having complied with the above policy. To enhance the position of the National Representative's appearance, the following suggestions are offered: 1. Contact should be made as far in advance as possible, designating the individual who will meet the representative, where the meeting will take place, and the specific time and day. 2. Prior to the event, an Exchangite should be assigned to be the host for the representative and spouse (if attending.) The host should provide the representative with a detailed schedule, indicating the time, place and dress requirements for each event. 3. An Exchangite, if not the host, should be provided to escort the representative to meals or functions not connected with the conference or convention itself. 4. The representative and spouse should be informed in advance of the function as to seating arrangements, and an Exchangite should be designated to sit with them if head table seating is not arranged. 5. An Exchangite or Exchangite's spouse should be assigned to inform and accompany the representative's spouse to and from any event specifically for spouses. PUBLICITY When a National Representative is scheduled to visit an Exchange Club or district, the visit can be a matter of local news value that should be taken advantage of to the fullest. Visits by Exchange dignitaries represent a considerable expenditure of time and energy. Therefore, it is reasonable to expect that the local club or district will spare no effort in attempting to obtain full publicity benefits from the visit. It is simply good public relations and image building that will benefit the entire Exchange organization. The Publicity Chairman should prepare a news release at least once a week in advance of the event at which the National Representative is to appear. It should give all details of the program -- who, what, when, where leading off with the news of the visiting speaker. Enough copies should be made for all local news media. If possible, releases and biographies should be personally delivered to the major news outlets -- newspapers, television and radio. Include the speaker's photo with the release to be given to the newspapers, as well as brochures and other materials containing background information on Exchange. At this time, the newspaper's city editor and television and radio news directors should be invited to assign a representative to cover the event. Offer complimentary meal tickets if it's to be a meal event. Actual coverage of the event should be a major goal. Several days after the visits, follow up with telephone calls. 26

27 The Exchange Club or district should have its own experienced photographer at the event whether news media people are there or not. A copy of one of the best photos, with identification and a written account, including all important details of the event, should be sent as soon as possible to the District Bulletin Editor and to Exchange Today Magazine for possible publication. If the National President is to be your National Representative, arrange for radio and television interviews. Frequently, broadcasters are interested in such public service interviews. These may be short news type interviews or longer panel interviews, where topics may range from the role of Exchange Clubs, to National Programs of Service, or to local club activities. Amended: Atlanta, Georgia, January 19, 1992 Charleston, South Carolina, August 27, 1993 Nashville, Tennessee, February 26, 1995 San Diego, California, July 10, 1996 Chicago, Illinois, July 12, 1998 Toledo, Ohio, September 29, 2001 Toledo, Ohio, September 13, 2003 Dallas, Texas, July 14, 2004 Salt Lake City, Utah, July 13, 2005 Orlando, Florida, July 26, 2006 Portland, Oregon, July 18, 2007 Toledo, Ohio, September 13, 2008 Toledo, Ohio, October 17, 2009 La Quinta, California, January 9, 2010 Columbus, Ohio, July 29,

28 POLICY STATEMENT 2.1a THE NATIONAL EXCHANGE CLUB MENTORING CANDIDATES FOR NATIONAL OFFICE Because the believes it is important for candidates for national offices to have an awareness and understanding of their responsibilities, each candidate shall be mentored. The Mentoring Committee will be available to candidates who submit applications by the annual filing deadline. Candidates who run from the floor will be mentored if they are elected. Mentoring sessions will be conducted by phone on a monthly basis, prior to the National Convention, and continue as needed once the candidate is elected. The Committee shall assure that mentoring is fair and consistent. Members of the Mentoring Committee shall consist of the following four individuals: Executive Vice President Immediate Past National President The two most recent Past National Presidents Houston, Texas, July 13,

29 POLICY STATEMENT 2.2 THE NATIONAL EXCHANGE CLUB THE NATIONAL EXCHANGE CLUB ADVISORY COUNCIL WHEREAS, the Past National Presidents of The National Exchange Club are qualified by experience and interest to counsel with the elected leaders of The National Exchange Club, and to act in an advisory capacity on subjects pertinent to the objectives and purposes of Exchange; NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of The National Exchange Club does hereby approve and grants authority for the creation of The National Exchange Club Advisory Council to be structured and to function in accordance with the following purposes and limitations: THE NATIONAL EXCHANGE CLUB ADVISORY COUNCIL There is hereby created The National Exchange Club Advisory Council, which shall meet once a year at the site of the Annual Convention of The National Exchange Club, the meeting to be held on a day immediately preceding the opening of the Convention or on a day during the Convention. The National Exchange Club Advisory Council shall consist of the Past National Presidents of The National Exchange Club. The most recent Past National President shall preside at the meetings of The National Exchange Club Advisory Council; in his absence, his immediate predecessor, and so on, shall preside. Membership shall be limited to the Past National Presidents who are active members of Exchange. The purpose of The National Exchange Club Advisory Council shall be to meet annually with the National President, the National President-Elect, and the Immediate Past National President, to exchange ideas and to conduct free discussions of plans, programs, or any subject pertinent to the objectives and purposes of Exchange. The National Exchange Club Advisory Council shall not be a management or policy-making body. No resolutions or formal statements shall be adopted for the notice of The National Exchange Club, the Districts of chartered Clubs, or the local Exchange Clubs and/or the members thereof. Any appropriate subject which meets the approval of those in attendance may be placed on the agenda for discussion and, if the Advisory Council may desire, it may submit through the National President to the Board of Directors of The National Exchange Club such recommendations as the Council shall deem suitable. Such recommendations may be received by the Board of Directors of The National Exchange Club for guidance. There shall be no dues; any expense of the annual conference to be borne by The National Exchange Club. Amended: June 9, 1971 New Orleans, Louisiana, September 10,

30 POLICY STATEMENT 2.5 THE NATIONAL EXCHANGE CLUB VOLUNTEER FIELD REPRESENTATIVES The following guidelines will apply regarding Volunteer Field Representatives: OBJECTIVE: Our vision is to have experienced Exchangites, trained in club leadership and management, strategically located throughout the United States and Puerto Rico. They, in turn, would supplement the activities of the national and district leadership, utilizing the latest tools, techniques, and materials generated by the National Headquarters staff. A VFR is to be the caliber of member who is recognized as a leader of The National Exchange Club. MISSION AND CHARTER: The Volunteer Field Representative program was formed by the National Exchange Club Board of Directors as a vehicle to carry out one of the mandates of our National Exchange Club Bylaws. That mandate states that one of the purposes of our national organization is "To improve the capabilities of our members." The board action placed the supervision and staff direction of the program under the direction of the National Headquarters staff. PROGRAM GOALS: 1. Ensure that new clubs are properly organized and trained. 2. Provide ongoing training of current and future club leaders. 3. Expedite the dissemination of new club building expertise. 4. Tap the resources of past district and national officers to the betterment of Exchange. 5. Leverage our leadership by having many individuals trained in current procedure in critical geographic locations adding to National's responsiveness. 6. Expand the leadership opportunities for the officers of the future. 7. Improve quality and consistency of training materials utilized. 8. Identify and cultivate future leaders. 9. Develop a culture of leadership within Exchange. Enhancing the leadership skills and abilities of our current and future leaders. 10. Establish a leadership training program for Past National Presidents. 30

31 RECRUITMENT AND SELECTION: 1. Candidates for the VFR Program must be nominated and endorsed by their district s Board of Directors. Selections are prioritized to obtain VFR coverage in all districts. 2. The district shall submit each endorsed application to National Headquarters. 3. Current members of the National Board, District Presidents, District Presidents-Elect, Foundation Trustees or declared candidates for any of these positions will not be selected, but may remain on the list. 4. Potential VFR candidates must have served as District President. TRAINING: 1. Training classes are to be conducted as determined by the National President and Executive Vice President. 2. A minimum of eight (8) candidates shall be required to conduct a VFR training class. 3. Faculty is to be selected by the national staff. TERM OF OFFICE: Volunteer Field Representatives will serve an initial term of four years. All VFRs shall remain in good standing by meeting the standards stated in policy. RESIGNATION: Should be submitted in the form of a written letter address to the Executive Vice President. Reinstatement will be recommended by the district. LEAVE OF ABSENCE: Requests should be made to the Executive Vice President in writing. Reinstatement will be recommended by the district. VFR TERMINATION: Request must be in writing from the District President, certified by the District Secretary, on behalf of the District Board of Directors. At least a 15-day notice must be given, informing the VFR that the matter will be addressed by the District Board of Directors. A Letter of Termination will be sent by the Executive Vice President. APPEALS PROCESS: An appeal must be in writing to the Executive Vice President. 31

32 The statute of limitations to appeal is one year from notification of termination. REQUIREMENTS: 1. VFRs should take an active role in improving the areas of club leadership, management and membership growth. VFRs are required to participate in at least one formal VFR training and update per year. RECOMMENDED ACTIVITIES: Activity Attend National Convention Plan/Coordinate District Officer Training at district seminar Plan/Coordinate Club Officer Training at district seminar Teach Club Officer Training at divisional seminar Teach Club Officer Training for a single club Assist and encourage New Club Building projects Resource Person/Visit New Clubs POM New Clubs Assist and encourage growth plans of action Club Visitation National Presentations District Presentations Divisional Presentations National Leadership Conference Presentations Club Presentations (Induction of Officers, New Members, etc.) National Assignments Submitting Monthly Report Identify, encourage and assist future leaders Encourage and promote attendance at district and national conferences ASSIGNMENTS: 1. Assignments will be made by the Executive Vice President or his or her designee. Assignments may also be made by the National President in conjunction with the Executive Vice President. 2. Requests for assignment should be made to the EVP in writing whenever possible; however, telephone requests will be honored as well. 3. Only those assignments made by the EVP (or designee) or National President will be considered for reimbursement. 4. All VFRs will be encouraged to take an active role in their district at their own normal expense. 5. Geographic location, travel expense, expertise and personal schedule are items to be considered when making assignments. EXPENSE REIMBURSEMENT: 1. A VFR will be reimbursed for all travel and hotel accommodations when on an authorized assignment or at VFR training, except personal entertainment. Who pays depends on the purpose of the assignment. 32

33 Purpose #1: DISTRICT OR REGIONAL TRAINING ASSIGNMENT a. Travel expense to and from district or regional meetings will be paid by The National Exchange Club. b. On site cost of meals and rooms should be paid by district or region. Purpose #2: PERMANENT ORGANIZATION MEETING/CHARTERINGS a. All travel, meals and lodging will be paid by The National Exchange Club. 2. All airline reservations are to be booked through The National Exchange Club's agency of choice. This will allow direct confirmation and billing to National Headquarters. 3. Auto mileage reimbursement will be the same as currently in effect for all Exchange travel. 4. All other anticipated expenses such as copies, supply orders, etc., over $50, should be cleared in advance with the National Headquarters. PROGRAM DIRECTOR: The VFR program is under the direction of the Executive Vice President. Amended: Nashville, Tennessee, July 19, 1995 Las Croabas, Puerto Rico, July 14, 1999 Toledo, Ohio, September 13, 2003 Salt Lake City, Utah, January 22, 2005 Orlando, Florida, July 26, 2006 Jacksonville, Florida, July 15, 2009 Detroit, Michigan, July 6, 2011 Chandler, Arizona, July 11,

34 POLICY STATEMENT 2.6 THE NATIONAL EXCHANGE CLUB VOLUNTEER FIELD REPRESENTATIVE ASSIGNMENTS RESOLVED that the following Policy will apply in determining the assignment of VFR (Volunteer Field Representatives): Any request for the appointment of a VFR to any club, district or regional function must be directed to the Executive Vice-President of The National Exchange Club. In making the appointment, the Executive Vice-President will take into consideration geographical location, the subject matter of the event, etc., in determining the appropriate VFR to be assigned. Boston, Massachusetts, January 15,

35 POLICY STATEMENT 2.7 THE NATIONAL EXCHANGE CLUB TRAINING OF DISTRICT PRESIDENTS-ELECT Either prior to succeeding to the office of District President, or within 90 days of assuming the authority of the District President, all in accordance with the District Bylaws as the same may be amended by the National Board of Directors, a District President-Elect shall complete a Leadership Training conducted by The National Exchange Club, its employees, volunteers and/or representatives to assist and train said persons in the performance of their duties. The National Exchange Club President or Executive Vice President will set the time, place and trainers for said Leadership Training. The National President or Executive Vice President can grant temporary waivers from this requirement. Should an individual have served a prior term (or terms) as District President or District President-Elect, The National Exchange Club is not required to cover expenses for additional Leadership Training. Amended: Toledo, Ohio, September 18, 2004 Jacksonville, Florida, July 12,

36 POLICY STATEMENT 2.8 THE NATIONAL EXCHANGE CLUB CLUB LEADERSHIP AND TRAINING RESPONSIBILITIES AND RESOURCES The following guidelines have been adopted in regard to club leadership, training responsibilities and resources: RESPONSIBILITIES FOR TRAINING DISTRICT DIRECTORS AND OFFICERS Club leadership is essential to continue the success of Exchange. District Directors are the vital link in club leadership development. Each District President has the responsibility for holding effective training for District Directors and other district officers. Volunteer Field Representatives are the standard training resource for fulfilling this responsibility. The National Headquarters staff has the responsibility for training the Volunteer Field Representatives. The National Headquarters staff has the responsibility for monitoring the training of district officers and directors. DISTRICT DIRECTORS TRAINING RESPONSIBILITIES AND RESOURCES The District Director has the responsibility for ensuring proper training club officers within his or her division. This may be accomplished by: A) Assuring club officer participation in district level training conferences. B) Conducting division level training conferences for group training of club officers. C) Providing training for club officers in their home community. Resources available to assist District Directors to fulfill this responsibility include: A) Standardized training materials 1) Printed literature 2) Videos 3) CDs B) District officers C) Other Exchange leaders D) Volunteer Field Representatives Amended: September 16, 1995, Toledo, Ohio Detroit, Michigan, July 6,

37 POLICY STATEMENT 2.9 THE NATIONAL EXCHANGE CLUB THE NATIONAL EXCHANGE CLUB S COMMITTEE RESPONSIBILITIES AND EXPENSE RESPONSIBILITIES All National Committees shall be created and filled within the guidelines of Article XVI of the Bylaws of The National Exchange Club. 1. All committees shall have a Chairperson or assigned Co-Chairpersons. Chair duties shall be to: A. Call and preside over all meetings of the committee. B. Monitor and ensure that the committee stays on task and is progressing as required. C. Work with the EVP and approve all funds being expended by committee action. D. Keep the National President informed of all committee progress. E. Report to the the committee s progress as requested. 2. All committees shall have at least one staff members as a liaison. Staff duties shall be to: A. Advise the committee as requested, and take minutes of all committee meetings. B. Publish said minutes in a timely manner as requested by the committee Chair. C. Staff members are in an advisory role only and shall not have a vote in committee decisions. Toledo, Ohio, September 13,

38 POLICY STATEMENT 2.10 THE NATIONAL EXCHANGE CLUB SUGGESTED VISITATION SCHEDULE FOR LARGE CLUBS Because the believes that it is important for the National Exchange Club to be in contact with large clubs, to accomplish this objective, each large club should be visited by a member of the Executive Committee and/or by a member of the in accordance with the following visitation schedule: Size of Club Cycle of Visit Level of representative 150 and Above 2 years Executive Committee Member 100 to years Executive Committee Member 75 to 99 2 years Member of the National Board The visitation is recommended to be at a club meeting, but it is also recommended that the representative attend a board meeting for the club. Chandler, Arizona, January 14,

39 POLICY STATEMENT 3.1 THE NATIONAL EXCHANGE CLUB BUDGET The Bylaws of The National Exchange Club provide that with recommendations of the Budget and Finance Committee, the Board of Directors annually shall adopt in advance of the next fiscal period, an annual operating budget covering all activities of The National Exchange Club; and, that appropriations in the annual budget shall not exceed the gross amount of the anticipated revenue for that year. For the purpose of exercising budget control throughout the entire year, the National Treasurer, who serves as the Chairman of the Budget and Finance Committee, and the Executive Vice-President, shall have the responsibility for monthly review of actual performance against the approved budget. They shall report any significant disparity in budgeted revenues and/or costs and expenses to the Board of Directors, and recommended corrective action to the Board of Directors. The Executive Committee of the Board of Directors acting in place and stead of the Board of Directors between Board meetings, is authorized to take immediate corrective action when such shall be deemed advisable, and shall be noted and ratified at the next Board of Directors meeting. Any expenditure not in the approved budget, over $2,500.00, will require three estimates before moving forward. The Executive Vice-President shall not approve or spend any funds for any expense over and above the approved budget amount in excess of $5, in the aggregate without the prior approval of the Executive Committee of the Board of Directors or the National Board. Amended: Hershey, Pennsylvania, September 6, 1986 Chandler, Arizona, January 14,

40 POLICY STATEMENT 3.2 THE NATIONAL EXCHANGE CLUB THE NATIONAL EXCHANGE CLUB INVESTMENT POLICY AND PROCEDURE FOR GENERAL INVESTMENTS Scope of the General Investment Policy This statement of policies and procedures relates to the investment policies, objectives and constraints of The National Exchange Club s general investments. Purpose of General Investment Policy and Procedure Statement This statement of investment is set forth by the Investment Committee of The National Exchange Club for the purpose of: 1. Defining and assigning the responsibilities of all involved parties. 2. Establishing a clear understanding of investment goals and objectives for all involved investment parties. 3. Offering guidance and providing limitations to the Committee Chair regarding assets being invested. 4. Formulating a basis for evaluating investment results. 5. Managing the assets of the investment funds according to the prudent standards as established by the common trust law. 6. Establishing a relevant investment horizon for which the Fund assets will be managed. In general the purpose of this statement is to outline a philosophy and attitude, which will guide the investment management of the assets toward the desired results. It is intended to be specific, meaningful, flexible and practical. Roles and Responsibilities The Board of Directors of The National Exchange Club is the fiduciary for all funds identified for investment. The Board s responsibilities include: (1) Preparing and monitoring an investment policy statement (2) Prudently diversifying the NEC assets to meet an agreed upon risk/return policy (3) Selecting investment options. (4) Control and account for all investments, record keeping and administrative expenses. (5). Monitor and supervise all service vendor and investment options. (6) Avoid prohibitive transactions and conflicts of interest. They shall act solely in the best interest of the NEC and in concert with the mission of the NEC. The Investment Committee is selected by the NEC National President and the NEC Foundation President, and shall act as the Investment Manager of the NEC investment portfolio. They are responsible for overseeing the management of the NEC assets and shall act solely in the best interest of the NEC. The Committee is authorized to engage the services of investment professionals with the approval of the Board of Directors. Their responsibilities include: (1) Setting and revising investment policies that the Board of Directors must approve (2) Developing investment objectives, asset allocation strategies and performance guidelines (3) Selecting investment consultants, advisors, money managers and custodians (4) Reviewing and evaluating investment results and approving changes as needed. (5) Conducting investment manager searches when advisable and monitoring the performance of the Investment Manager. (6) Reviewing the investment history of the NEC, historical capital markets performance and the contents of this investment policy 40

41 statement to any newly appointed members of the Investment Committee. (7) Providing reports to the Board of Directors. Investment Committee Chair must acknowledge in writing acceptance of responsibility as a fiduciary. The Investment Committee will have full discretion to make all investment decisions for the assets of the NEC, while observing and operating within the policies, guidelines, constraints, and philosophies of this statement. The Investment Committee s responsibilities include: (1) Discretionary investment management including decisions to buy, sell, or hold individual securities, and to alter asset allocation within the guidelines of this statement (2) Reporting, on a timely basis, quarterly investment performance results. (3) Communicating any major changes to economic outlook, investment strategy, or any other factors, which affect investment process or the investment objective of the NEC. (4) Informing the Investment Committee of any qualitative change to the investment management organization i.e. changes in portfolio management personnel, ownership structure, investment philosophy, etc. (5) Voting proxies, if requested by the Investment Committee, on behalf of the investments, and communicating such voting records to committee. Finance Staff is responsible for the safekeeping of the NEC assets. The specific duties and responsibilities include: (1) Providing monthly reports that detail transactions, cash flows, securities held and their current value, and change in value of each security and the overall portfolios since the previous report. (2) Maintaining separate accounts by legal registration. (3) Valuing the holdings. (4) Collecting all income and dividends owed to the NEC. (5) Settling all transactions initiated by the Investment Committee Chair. General Investment Principles 1. Investments shall be made solely in the interest of the beneficiaries and services of the NEC. 2. The funds shall be invested with the care, skill, prudence, and diligence under the prevailing circumstances. 3. Investment of the funds shall be so diversified as to minimize the risk of large losses, unless under the circumstances it is clearly prudent not to do so. 4. The Investment Committee may employ one or more investment managers of varying styles and philosophies to attain the NEC s investment objectives. 5. Cash is to be employed productively at all times, by investment in short-term cash equivalents to provide safety, liquidity, and return. Spending Policy The National Exchange Club places a high emphasis on meeting its obligations. Expenditures from investment funds classified as unrestricted will be spent with the approval of the NEC Board of Directors, through the budgeting process. The investment portfolio shall remain sufficiently liquid to meet operating requirements that may be reasonably anticipated. Investment Goals The investment goal of The National Exchange Club is to grow invested assets, net of spending, with the overriding objective to maintain purchasing power (as measured by the CPI) plus 3% minimum. This investment goal is the objective of the aggregated fund and is not meant to be imposed on each investment account. The goal over the horizon shall be to: (1). Meet or exceed the market index, or blended market index, selected and agreed upon by the Investment Committee. 41

42 (2). Display an overall level of risk in the portfolio which is consistent with the risk associated with the benchmark specified above. Risk will be measured by the standard deviation of quarterly returns. Investment Guidelines Allowable Assets 1. Cash Equivalents Treasury Bills Money Market Funds STIF Funds Commercial Paper Banker s Acceptances Repurchase Agreements Certificates of Deposit 2. Fixed Income Securities U.S. Government and Agency Securities Corporate Notes and Bonds Mortgages Backed Bonds Preferred Stock Fixed Income Securities of Foreign Governments and Corporations REIT Unit Investment Trusts (UIT s) Mutual Funds and Exchange-Traded Funds composed of any of the above 3. Equity Securities Common Stock Convertible Notes and Bonds Convertible Preferred Stocks American Depository Receipts of Non-U.S. Companies Stocks of Non-U.S. Companies Unit Investment Trusts (UIT s) Mutual Funds and Exchange-Traded Funds composed of any of the above Prohibited Investments Prohibited investments include, but not limited to the following: 1. Commodities and Futures Contracts, except for Mutual Funds and Exchange-Traded Funds composed of commodities and/or natural resources 2. Private Placements 3. Options (except for covered call options) 4. Venture-Capital Investments 5. Individual Real Estate Properties 6. Interest-Only, Principal only, and Residual Tranche CMOs 42

43 Prohibited transactions include, but not limited to the following: 1. Short Selling 2. Margin Transaction Summary of NEC Investment Program Asset Allocation Guidelines Plan: Current Assets: Time Horizon: Expected Return: Risk: Investment of Unrestricted Assets See Financial Statements Intermediate (3 to 7 years) Refer to investment goals Moderate Investment of assets shall be in accordance with the following asset allocation guidelines. These guidelines may be temporarily (quarterly) departed from when approved by the Investment Committee. 1. Aggregate Asset Allocation Guidelines Lower Limit Strategic Allocation Upper Limit Domestic Large Cap Equities 15% 20% 50% Domestic Small & Mid Cap Equities 0% 13% 25% International Equities 5% 12% 25% Fixed Income 33% 40% 70% Cash and Equivalents 0% 5% 20% Real Estate 0% 5% 10% Natural Resources 0% 5% 10% Evaluation Benchmark: Total return to exceed the performance of a blended index based on the strategic asset allocation of the NEC. The indexes to be used, which correspond to the above seven asset classes are: S&P 500 Index (Domestic Large Cap Equities) Barclay s Capital U.S. Aggregate Index (Fixed Income) Russell 2000 Total Return Index (Domestic Small & Mid Cap Equities) MSCI EAFE Total Return Index (International Equities) Bloomberg U.S. Generic Government 3-month Yield (Cash & Cash Equivalents) FTSE NAREIT Equity REIT Total Return Index (Real Estate) S&P GSCI Commodity Total Return Index (Natural Resources) 43

44 Performance Review and Evaluation Performance reports generated by the Investment Committee Chair shall be compiled at least quarterly and communicated to the Investment Committee for review. The investment performance of total portfolios, as well as asset class components, will be measured against commonly accepted performance benchmarks. Consideration shall be given to the extent to which the investment results are consistent with the investment objectives, goals, and guidelines as set forth in this statement. The Investment Committee will evaluate the portfolio over a three-year period, but reserves the right to terminate a manager for any reason including the following: 1. Investment performance, which is significantly less than anticipated given the discipline employed and the risk parameters established, or unacceptable justification of poor results. 2. Failure to adhere to any aspect of this statement of investment policy, including communication and reporting requirements. 3. Significant qualitative changes to the investment management organization. Investment managers shall be reviewed regularly regarding performance, personnel, strategy, research capabilities, organizational and business matters, and other qualitative factors that may impact their ability to achieve the desired investment goals. Investment Policy Review To insure continued relevance of the guidelines, objectives, financial status and capital market expectations as established in this statement of investment policy and procedure, the Investment Committee plans to review investment policy at least annually. Amended: Toledo, Ohio, September 17, 2005 Orlando, Florida, July 26, 2006 Toledo, Ohio, October 6, 2012 Greensboro, North Carolina, July 10,

45 POLICY STATEMENT 3.3 THE NATIONAL EXCHANGE CLUB CONFLICT OF INTEREST AND INDEMNIFICATION CONFLICT OF INTEREST a.) It shall be a conflict of interest for any officer or member of The National Exchange Club Board of Directors (hereinafter referred to as a "Board Member") who is a member of a corporation, firm, association, foundation, sole proprietorship or other business entity, which does business with or performs services for, or has a financial interest in any contract, agreement, offer or proposal to do business with The National Exchange Club or The National Exchange Club Foundation. b.) The Board Member shall disclose his/her membership or financial interest in the corporation, partnership, firm, association, foundation or sole proprietorship or other business entity, or the contract, agreement or service immediately upon discovery of the conflict or potential conflict of interest. c.) Disclosure shall be made in writing to the National Exchange Club Board of Directors who will make it known at the next Board meeting and the writing shall be placed in the minutes. If the conflict or potential conflict becomes known to the member at a Board meeting, the Board Member shall immediately make his/her conflict or apparent conflict known and refrain from participating in any discussion, making of motions or voting on any issue dealing with his/her conflict or potential conflict of interest. All abstentions from discussion or voting on any issue shall be clearly stated in the minutes and the reason for his/her abstaining. Directors, officers, committee chairs, and staff members of the association will be required to attest annually to their familiarity with this policy and to provide information concerning any possible conflict of interest so that disclosure, if necessary, is made. Staff members will not benefit materially from the association beyond receipt of salaries, fringe benefits, and reimbursement for authorized expenses. d.) Any contract, agreement or service between the and a corporation, partnership, firm, association, foundation, sole proprietorship or other business entity in which disclosure is not made prior to Board approval shall be voidable by the as a result of the conflict or financial interest of a member of the Board of Directors. e.) The conflict or financial interest in a contract, agreement or service shall not prevent a Board Member from being counted in determining the presence of a quorum at any meeting of the Board of Directors or a committee. f) A conflict of interest transaction is a transaction in which a Board Member has any direct or indirect interest. g) These procedures (i) will not apply to reimbursement of expenses actually incurred by any director in the course of performing his or her duties as such; and (ii) may be waived or altered in any particular case by vote of a majority of the disinterested directors participating in the meeting and constituting a quorum for good cause shown. h) To assist in implementing this Policy, each proposed new Board member will file a Conflict Disclosure Statement substantially in the form of Exhibit A attached hereto in connection with the election and/or selection process. Existing Board members, officers, committee members and staff will file the Conflict 45

46 Disclosure Statement annually, with the Executive Director, whose responsibility it will be to oversee the annual distribution of such forms to those responsible to report under this policy. INDEMNIFICATION a.) Every person who is serving or has served as a Board Member shall be indemnified by The National Exchange Club against all liability and reasonable expenses incurred by such Board Member in defense of any threatened, pending or completed action, suit, or proceedings, whether civil or criminal, administrative, or any formal or informal investigation because such person is or was an officer or member of the Board of Directors of The National Exchange Club, provided such person has acted in a reasonable and prudent manner while serving on the. b.) The National Exchange Club shall indemnify and be responsible for any expenses incurred by such Board Member to the extent funds are available. If such Board Member is sued or notified of a threatened action, he/she shall provide notice to the Executive Vice President within seven (7) days he/she becomes aware of the civil, criminal, administrative or investigative action or proceeding. If the Board Member fails to provide notice within the seven (7) days it may be grounds for The National Exchange Club to deny indemnification. Amended: Nashville, Tennessee, July 19, 1995 Toledo, Ohio, September 16, 1995 Detroit, Michigan, January 22,

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