As of November 2, 2011
SOUTHBRIDGE TOWERS, INC.
DECLARATION OF PURPOSES
SECTION 1. The object of the Corporation is to construct and operate housing
accommodations and adjunct facilities for its shareholders in accordance with cooperative
principles, subject to the provisions and limitations of the Private Housing Finance Law and the
Rules and Regulations promulgated by the Commissioner of Housing and Community Renewal.
SECTION 1. The annual meeting of shareholders shall be held on the 1st Tuesday of
May each year at the hour of 8:00 P.M. for the purpose of (a) electing directors, as more fully
described in Article Ill, Section 1 and (b) conducting any other business set forth in the written
notice of meeting which shall be given each shareholder no less than twenty days nor more than
forty days prior to the date of the meeting. All shareholders of record in good standing on the
date of the meeting shall be entitled to vote, but anyone becoming a shareholder of record after
the date on which written notice of meeting has been given shall not have the right to the above
written notice. The annual meeting shall be held in the offices of the Corporation or at such
other location in the Borough of Manhattan, City and State of New York as may be designated
by the Board of Directors.
SECTION 2. The Commissioner of Housing and Community Renewal or his duly
authorized representative shall be notified in writing of and shall have the right to attend all
meetings of the shareholders of the Corporation.
SECTION 3. Special Meetings. Special meetings of the shareholders for any purpose
or purposes may be called at any time by (a) the President, (b) the Commissioner of Housing and
Community Renewal or his duly authorized representative, (c) the President or Secretary at the
request in writing of a majority of the Board of Directors, or (d) the President or Secretary at the
request in writing of 25% of the shareholders. Written notice of such meetings shall set forth the
time and place of the holding of such meeting indicating that it is being issued by or at the
direction of the person or persons calling the meeting and the purpose or purposes thereof. The
notice shall be mailed to each shareholder entitled to vote at such address as appears on the
sharebook not less than 10 nor more than 30 days prior to the date of the meeting.
SECTION 4. Quorum. Presence in person or by proxy of a one-third of holders of the
outstanding shares entitled to vote shall be necessary to constitute a quorum, but, a lesser number
may adjourn from time to time without notice other than an announcement at the meeting in
which the requisite number of shareholders shall not be present.
SECTION 5. Voting. At any meetings of the shareholders, all questions not
specifically regulated by Statute, the Certificate of Incorporation or by these By-Laws shall be
determined by a vote of the majority of the shareholders present, in person or by proxy, at the
meeting. Each shareholder shall be entitled to one vote for any purpose regardless of the number
of shares held by such holder. The inspectors of the election shall have a duty to vote in
accordance with the directions of any proxy that is delivered to them and names the inspectors as
holders of the proxy. The Board of Directors, by resolution adopted prior to mailing notice of
any shareholder meeting, may provide for voting by shareholders on voting machines or
otherwise prior to the commencement of the meeting of the shareholders; such voting shall be
deemed to be held at such meeting and the shareholder shall be deemed present at such meeting
(including any recesses) for the purpose of determining a quorum.
SECTION 6. Order of Business. At all meetings of the shareholders the following
order of business shall be observed so far as consistent with the purposes of the meeting:
1. Meeting called to order.
2. Calling the roll of persons entitled to vote.
3. Proof of notice of meeting.
4. Reading of the minutes of the previous annual meeting.
5. Reports, respectively, of President, Treasurer and Secretary.
6. Reports of committees, if any.
7. Election of Directors.
8. Transactions of such other business as may properly come before
SECTION 1. Number and Term of Office and Qualifications. The number of
Directors shall be fifteen plus one additional Director who may be designated by the
Commissioner of Housing and Community Renewal. All Directors, except the Commissioner’s
designee, must be shareholders, not of the same apartment unit. At each annual meeting of the
shareholders, Directors shall be elected for terms of 3 years to succeed those Directors whose
terms are expiring in that year. Additional Directors shall be elected to fill the unexpired terms
resulting from vacancies. Those five candidates receiving the highest number of votes shall be
elected to three year terms. The next highest candidates (in order of the number of votes cast in
their favor) shall be deemed elected to the unexpired terms created by vacancies. Each director,
except the Commissioner’s designee, shall serve as such Director, until his successor has been
elected and qualified No person, other than the designee of the Commissioner, shall be eligible to
be elected to the office of director of the Corporation unless he/she is (i) a shareholder of record
on the Corporation’s stock ledger, (ii) has submitted a resume by the deadline set forth in the
“notice of election of Board of Directors” given by the Corporation, and (iii) is not more than
one (1) month in arrears on his/her maintenance as of the deadline set forth in the “notice of
election of Board of Directors” given by the Corporation. In the event of a tie vote for one or
more vacancies, the annual meeting of shareholders shall be recessed for two days and
reconvened at 10:00 a.m. on the second day and be held open for voting until 8:00 p.m., during
which period voting on a runoff election between those candidates who tied will occur.
SECTION 2. Vacancies. Any vacancy occurring on the Board of Directors may be
filled until the next regular annual meeting of shareholders by a majority vote of the remaining
Directors. If such remaining Directors are not sufficient to constitute a quorum, a special
meeting of shareholders shall be called and such number of Directors shall be elected as may be
necessary to constitute the full membership of the Board.
SECTION 3. Meetings. Meetings of the Board of Directors may be held at any time
upon call of the President, or quorum of the Board, or the Commissioner of Housing and
Community Renewal or his duly authorized representative. Any part or parts of any meeting
may be declared an executive session on motion and by a majority vote of the members present.
Further, the Board may, from time to time, declare meetings open to shareholder participation.
SECTION 4. Notice of Meetings. Notice of each meeting of the Board, stating the
time, place and purposes thereof shall be given by delivery at least 48 hours before such meeting
at the apartment of each resident Board member; however, emergency meetings may be called as
required. The Commissioner of Housing and Community Renewal or his duly authorized
representative shall be notified of all meetings.
SECTION 5. Quorum. A majority of the Board of Directors shall constitute a
quorum, and a majority of the members in attendance at any meeting of the Board shall, in the
presence of a quorum, decide its action. In the absence of a quorum, the members present at any
meeting may adjourn to a later date but may not transact any other business.
SECTION 6. Committees. The Board of Directors may, from time to time, create
Committees with such powers and duties as it shall determine.’
SECTION 7. Duties and Powers. The Board of Directors shall have entire charge of
the property, interests, business and transactions of the Corporation and may adopt such rules
and regulations for the conduct of its meetings and management of the Corporation as it may
deem proper, not inconsistent with the law, the Certificate of Incorporation, or these By-Laws.
The Board of Directors may delegate to the Officers of the Corporation such power and authority
and assign to them such duties as the Board may deem necessary, proper or appropriate to the
effective prosecution of the Corporation’s business.
SECTION 8. Minutes. A copy of the Minutes of each Board of Directors meeting
shall be posted on the Bulletin Board of each building after the approval of said Minutes.
SECTION 9. Director Attendance. Failure of a Director to attend, in its entirety, three
consecutive meetings, or five of twelve regular meetings within any twelve-month period will be
deemed to have vacated the Office as a Director. Said Director has the right to appeal to the
Board, in writing, within fifteen days from the date the Office is deemed vacated. A vacancy
occurring under this Section may be filled at the next regular Board meeting according to the
provisions of these By-Laws.
SECTION 10. Ethical Conduct. No Director or any member of his/her immediate
family shall have a financial interest in an entity, not a public corporation, doing business with
the Cooperative, or accept any gratuities from an entity by reason of doing business with the
Cooperative, unless such conduct is approved at a shareholders meeting. Failure of a Director to
conform to the above shall be grounds for removal by the Board.
SECTION 11. Terms Limits. No person may be elected to more than three consecutive
full three-year terms as a member of the Board of Directors. A Director who has been elected by
the Board of Directors or by the shareholders to fill an unexpired term may complete that term as
well as no more than three consecutive additional full three year terms. Under no circumstances
may a person serve as Director for more than eleven consecutive years.
SECTION 1. Election. The Board of Directors at its first meeting after the election of
Directors in each year shall elect from its number a President and shall also elect a Vice-
President, a Secretary and a Treasurer. It may elect an Assistant Secretary and Assistant
Treasurer and such other officers as in, its discretion the needs of the Corporation may from time
to time require.
SECTION 2. Removal of Officers. Any Officer may be removed by a 2/3 vote of all
other Board members. Said vote shall occur on 3 days notice to be given immediately after the
receipt by the President or the Secretary of a petition for removal signed by at least 5 Board
members. Any vacancy occurring in any office shall be filled by the Board of Directors.
SECTION 3. President. The President shall preside at all meetings of the Board of
Directors, shall act as Chairman at and call to order, all meetings of the shareholders and shall
appoint all Committee Chairmen. Subject to the policy and direction of the Board, the President
shall have general management of the affairs of the Corporation and perform all duties incidental
to his office.
SECTION 4. Vice-President. The Vice-President shall, in the absence, disability or
incapacity of the President, have the powers and perform the duties of the President.
SECTION 5. Secretary. The Secretary shall keep the minutes of the meetings of the
Directors and shareholders; shall attend to the serving of notices of the meetings of the Directors
and shareholders; shall affix the seal of the Corporation to such certificates, documents and
papers as may require it, except that from time to time the Board of Directors may direct such
seal to be affixed by any other Officer or Officers; shall have the charge of the share certificate
book and such other books and papers as the Board of Directors may direct; shall attend to such
correspondence as may be assigned to him and shall perform all other duties incidental to his
office and those which the Board of Directors may from time to time designate.
SECTION 6. Treasurer. The Treasurer shall be the Chief Financial Officer of the
Corporation and shall have the care and custody of all the funds and securities of the Corporation
and shall cause to be deposited the same in the name of the Corporation in such bank or banks as
the Directors may designate subject to the approval of the Division of Housing and Community
Renewal. He may be required by the Board of Directors to give such bonds as it shall determine
for the faithful performance of his duties.
SECTION 7. Assistant Secretary and Assistant Treasurer. The Assistant Secretary
and the Assistant Treasurer shall, respectively, in the absence, disability or incapacity of the
Officer to whom he is an assistant, have the powers to perform the duties of such Officer, and
shall perform such other duties as may be assigned from time to time by the Board of Directors.
They may be required by the Board of Directors to give such bond as it shall determine, for the
faithful performance of their duties.
SECTION 8. Other Officers. Other Officers shall perform such duties and have such
powers as may be assigned to them from time to time by the Board of Directors.
SECTION 9. Dual Officers. No two Officers of the Corporation are to be held by the
OPERATION OF THE COOPERATIVE
Subject to statute, the Corporation shall conduct all matters for the welfare, benefit and
financial interest of the Cooperative. The Corporation shall pay, after the payment of
obligations, expenses, taxes and assessments and the establishment of suitable reserves, a rebate
of carrying charges to each shareholder in proportion to the carrying charge payments made by
him during the period in which such rebate is applicable. The monthly carrying charges paid by
the shareholders shall be deemed to be payment on account of their annual carrying charge
obligation, which shall be finally determined by the Board of Directors in the light of each year5s
operating experience. Shareholders’ files can only be accessed by the Corporation’s Manager
and Manager’s staff deemed appropriate by the Manager, and by the Corporation’s legal counsel.
SIGNATURE OF INSTRUMENTS
Checks, notes, drafts and orders for the payment of money and obligations of the
Corporation and all contracts, mortgages, deeds and other instruments, except as otherwise in
these By-Laws provided, shall be signed by such Officer, Officers, individual or individuals as
the Board of Directors may from time to time designate.
SECTION 1. Certificates. Capital Shares shall be numbered and issued in consecutive
order, shall be signed by the President or the Vice-President and by the Secretary or an Assistant
Secretary or the Treasurer and sealed with the seal of the Corporation; and in appropriate books
of record shall be entered the name of the person owning the shares represented by each
certificate, the number of shares and the date of issue. All certificates exchanged and returned to
the Corporation shall be marked ‘Cancelled”, with the date of cancellation by the-Secretary or
any Officer designated by the Board and shall be filed among the corporate records of the
SECTION 2. Transfers. Shares represented by any certificate shall be transferable
only in its entirety on the books of the Corporation, by the holder, in person or by attorney-infact,
upon surrender of the certificate for such shares.
SECTION 3. Restriction on Transfers. No shareholders shall have the right or power
to pledge, sell, alienate or otherwise dispose of any share or shares of the Corporation except as
hereinafter set forth:
A. Shareholders Notice of Intention to Sell Shares. The Shareholder
desiring to sell his shares shall inform the Corporation in writing of his intention. Such notice
shall be signed by the shareholder and (1) delivered in person, or (2) sent by certified mail to the
Office of the Corporation. Such notice shall constitute the irrevocable appointment of the
Corporation as the exclusive agent of the retiring shareholder for the sale of his shares and shall
remain in effect for ninety days from the date of receipt by the Corporation of such notice. The
Corporation shall acknowledge receipt of the retiring shareholder’s notice and inform him of the
proportionate share of the amortization applicable to his shares and the maximum resale price at
which the shares will be offered to eligible purchasers. The resale price shall not exceed the
maximum amount allowed by law and regulation.
B. Selection of new Cooperator and Obligations Thereunder.
(1) By the Housing Company: the eligible applicants on the
waiting list shall be canvassed in accordance with the requisite tenant selection procedure. The
price to be paid by the incoming cooperator for the shares shall be the maximum amount allowed
by state law and regulation. If the Corporation, within the said ninety day period shall indicate
that it desires to purchase said shares it shall give notice thereof in writing to the retiring
shareholder. The retiring shareholder shall be bound, within 30 days of such notice, to surrender
such share certificate and vacate the apartment. Within 30 days thereafter, the Corporation shall
pay the retiring shareholder the price herein provided, subject to all charges and adjustments.
(2) By retiring shareholder: If the Corporation is unable to
produce an eligible purchaser within the ninety day period, the retiring shareholder shall then
have the right or power to pledge, sell, alienate or otherwise dispose of his shares of the
Company at any price, not to exceed the maximum resale price, to any person, acceptable to the
Corporation and to the Commissioner provided such person shall, upon the transfer of said
shares, enter into an occupancy agreement with the Corporation for the premises formerly
occupied by the retiring shareholder upon the same terms and conditions contained in the
occupancy agreement between the retiring shareholder and the Company. The Corporation will
not unreasonably withhold its acceptance of any person to whom the shareholder proposes to sell
such shares as aforesaid. The Corporation must approve any transaction between the retiring
shareholder and a qualified eligible purchaser. Prior to consummation of sale and before
approval of the purchaser by the Corporation and the Commissioner, affidavits must be
submitted by both the retiring shareholder and the purchaser as to the resale price of the shares
being transferred. If the retiring shareholder is unable to sell his shares pursuant to the terms and
conditions hereof to any person within six months after his right to do so has accrued and he still
desires to resell his shares, he must then again notify the Corporation of his intent to transfer
such shares and he shall again be bound by the provisions of this Article.
C. Default by Retiring Shareholder in Transfer of Shares:
(1) If the retiring shareholder, after giving notice and becoming
bound to sell, convey or transfer his shares of the Corporation, or such other person as may be
designated by the retiring shareholder, fails to surrender such share certificate and/or vacate the
apartment, the Company may, after notice to and approval of the Commissioner, hold the
purchase money in trust for the retiring shareholder or his executors, administrators, or assigns
and shall substitute the name of the purchaser upon the books of the Corporation in place of the
name of the retiring shareholder. After the name of the purchaser has been entered on the books
of the Corporation and the exercise of the aforesaid powers, the validity of the proceeding shall
not be questioned by any person and the Corporation shall be deemed and taken to be the owner
of such shares.
(2) In the event that the shareholder shall have defaulted in the
payment of any obligation arising out of his agreement with the Corporation or shall, apart from
said occupancy agreement, become indebted to the Corporation, or in the event of the
termination of the occupancy agreement or the recovery of possession of the apartment by the
Corporation under any of the provisions of the occupancy agreement, or in the event of the
violation by the shareholder of any provisions of Article VII, Section 3 of these By-Laws, the
shareholder shall forthwith surrender to the Corporation the certificate representing the capital
shares of the Corporation owned by the shareholder. Upon the failure or refusal of the
shareholder to surrender said shares, the same shall, after notice to and approval by the
Commissioner of Housing and Community Renewal, be automatically cancelled and rendered
null and void and the Corporation may issue a new certificate or certificates in their place and
stead and such new certificate or certificates shall represent the same shares as were represented
by original certificate or certificates. The shares represented by the certificates, surrendered or
new, may be sold by the Corporation at public or private sale, without notice and the proceeds
applied toward any indebtedness of the shareholder, and the Corporation shall remit any balance
after payment of the expenses of sale to the shareholder, who shall remain liable for any
D. Sale to Corporation. If the Corporation wishes to purchase the
shares of the retiring shareholder upon expiration of the ninety day period and has funds
authorized for such purchase, it may, with the approval of the retiring shareholder and of the
Commissioner, purchase such shares at a price not to exceed the maximum allowed by law and
E. Shares Not to be Pledged by Shareholder No shareholder shall
have the right or power to pledge or otherwise encumber any share or shares of the Corporation
except as herein otherwise provided.
F. The provisions of this Article VII shall be binding upon any
executor, administrator or other legal representative and successors and assigns of every
shareholder. Any person, other than a surviving spouse or other legal occupant, acquiring
through will or descent, or by conveyance to take effect at death, any share or shares of the
Corporation shall be bound to offer the same for sale and transfer to the Corporation upon the
terms hereinabove set forth in this Section.
G. The certificate shall bear a legend to the effect that the right to
pledge, encumber, sell, alienate or otherwise dispose of the share of shares represented by such
certificate is restricted as provided in Sections 2 and 3 of this Article.
H. (1) The sale or transfer of the shares of a retiring shareholder
who has failed or refused to pay any surcharges then due and payable need not be approved.
(2) No payment shall be made to the retiring shareholder until
the purchase money from the incoming cooperator has been received by the Corporation, or
otherwise provided herein.
(3) All purchasers must meet all eligibility standards and be
selected in accordance with the priorities and requirements of the Tenant Selection Procedure.
SECTION 4. The Corporation shall be entitled to treat the holder of record of any
share or shares of the Corporation as the holder in fact thereof and shall not be bound to
recognize any equitable or other claim to or interest in such share on the part of any other person
whether or not it shall have express or other notice thereof, except as expressly provided by the
laws of, the State of New York.
SECTION 5. The Corporation shall have a lien upon the shares of any shareholder and
upon all moneys due and owing by the Corporation to any shareholder for any and all debts
owed to the Corporation by such shareholder. The Board of Directors may refuse to approve a
transfer of any shares upon which the Corporation has such lien.
SECTION 6. As used in this Article the words “share”, “Capital shares” and
“certificates” shall include any interest in the Corporation and the word “Shareholder” shall
include the owner or holder of any such interest.
SECTION 7. Lost, Destroyed and Stolen Share Certificates. Any person claiming a
certificate representing shares to be lost, apparently destroyed or wrongfully taken shall make an
affidavit or affirmation of that fact and advertise the same in such manner as the Board of
Directors may require and shall give the Corporation an indemnity bond in such form and with
one or more sureties satisfactory to the Board, in such amount as the Board may determine.
These By-Laws may be amended, repealed or altered, in whole or in part, by a majority
vote of one-third of the shareholders of the Corporation at (1) any duly called annual or special
meeting of the shareholders, provided the proposed amendment is set forth in the notice of
special meeting, or (2) by a mail ballot vote of the shareholders of the Corporation provided the
Board of Directors of the Corporation so directs and provided further that notice of the mail
ballot vote has been given at least fifteen days prior to such vote. The Board of Directors shall
not alter or repeal any By-Laws adopted by the shareholders of the Corporation, but may adopt
additional By-Laws, in harmony therewith, which must be ratified by the shareholders at the next
annual meeting or at a special meeting of the shareholders called for this purpose. Any and all
amendments or changes of these By-Laws shall be effective only if and when approved by the
Commissioner of Housing and Community Renewal.