Starting an investment club is much easier if you can see how others have done it in the past. I reviewed the goals, responsibilities, and club business in how to start an investment club  and covered our investment club portfolio and returns .
A reader, Kevin, is interested in starting his own investment club. He emailed me looking for a little more direction and a sample charter. Here is a copy of our current bylaws. I removed the dates and other information that you would need to specifically enter for your own club. Feel free to copy our bylaws, or tweak them for your own club.
Investment Club Bylaws
THIS AGREEMENT OF PARTNERSHIP, effective (insert date) replaces any previous partnership agreements.
The undersigned hereby form a General Partnership, to be known as The Investment Club of (city), (state) in accordance with the laws of the State of (insert state name), herein after referred to as “The Club”.
The partnership began on (insert date). It continues each calendar year unless earlier termination as hereinafter provided.
The only purpose of The Club is to invest the assets of The Club solely in stocks, bonds and other securities (collectively herein referred to as “securities”) for the education and benefit of the partners.
Officers of The Club shall be President, Vice-President, Secretary, Treasurer and Assistant Treasurer elected from the Partnership
Officers shall be elected at the annual meeting, take office and begin duties at the meeting following the election and serve for one year or until new officers are elected. Upon the occurrence of a vacancy, an interim election shall be held to fill the vacancy for the balance of The Club year. Officers may succeed themselves in the same office.
The President shall preside at meetings, appoint committees, oversee all club activities, and see that resolutions passed by the partnership are carried out. The President shall be one of the two partners empowered to sign for the partnership and shall act as the partnership’s agent for investment activities and shall place buy and sell orders authorized by the partners with The Club’s broker, Scottrade .
The Vice-President shall assume the duties of the President when the president is absent or unable to serve. The Vice-President is responsible for insuring that The Club’s study program is properly carried out, maintaining an educational program of the partnership and appointing partners to present investment reviews and serve on educational committees and maintain a file of their reports.
The Secretary shall keep a record of The Club meetings and business, and report on previous meetings and keep attendance. The Secretary will issue a written notice to partners who have not met the attendance requirement. The Secretary will serve as a back-up Treasurer when needed.
The Treasurer shall disburse funds, maintain books covering The Club’s financial operations, assets, partners’ shares, and member’s deposits, prepare proper tax forms, and maintain an account in the name of The Club at Scottrade . Each year, at the annual meeting, a full and complete account of the condition of the partnership shall be made to the partners by the Treasurer. The Treasurer shall be one of the two partners empowered to sign for the partnership and shall act as the partnership’s agent for investment activities and shall place buy and sell orders authorized by the partners with The Club’s broker, Scottrade .
5. Assistant Treasurer
The Assistant Treasurer shall collect members deposits, record the deposits, deposit the money into the bank account in The Club’s name, give Treasurer the record of deposits and assist Treasurer in any other duties as assigned by Treasurer within 48 hours except for unforeseen circumstances.
Additional partners may be admitted at any time, after attending two meetings, upon the unanimous consent of all the partners in writing or at a meeting of the partners so long as the number of partners does not exceed fifteen (15). Any new partner will be furnished a copy of this agreement, must sign the original and will be bound by all terms and provisions herein in the same manner as other partners.
B. No Compensation
No partner shall be compensated for services rendered to the partnership, except reimbursement for expenses.
C. Transfers to a trust
A partner may, after giving written notice to the other partners, transfer his interest in the partnership to a revocable living trust of which he is the grantor and sole trustee.
1. Regular meetings of The Club shall be held each month at a time and place determined by The Club.
2. Annual meetings will be held each January.
3. A special meeting may be called by the Officers upon 24-hour notice to each member of The Club.
Each partner shall participate in the management and conduct of the affairs of The Club equally. Except as otherwise provided herein, all decisions shall be made by a majority of the partners.
2. Quorum and Partner Absence
To make any binding business decision related to the partnership, a quorum must be present at any meeting, which such a decision will be made. A quorum is defined and will be established when the represented partners is equal to or greater than 1/2 of the total partnership. An absent partner may vote in writing with the proper signature or by E-mail on any particular item. Any such vote document must be secured in advance and presented by an attending partner. In the case of an absent vote a quorum may be established for only the item to which the vote document pertains. Each item to be considered will be resolved by a majority either present or for which vote documents are available provided a quorum exists. In addition, a partner may provide another partner with a general proxy in writing or by E-mail with instructions on how to apply the absent partner’s vote. In this case the attending member must provide the proxy document to the recording partner for validation in order to exercise the proxy. The capital accounts for which valid proxies exist will be included in the quorum determination.
Buy and/or sell action may be taken after a discussion by the partners and when voted by simple majority of the partners present at a scheduled meeting. Purchases on margin and short sales are prohibited. Each partner shall have one vote, except as provided in Section C7: Dissolution of The Club.
4. Capital Contributions
a. Initial Fee
Upon joining the Club, each person must make a one-time deposit of $100.00 payable on the date of her signature on the roll. $25.00 will be in the form of a fee to cover expenses and $75.00 will be an initial deposit for investment.
After joining, each partner shall make a deposit of $35.00 each month at the regular monthly meetings. Each partner shall remit her monthly deposit to the Treasurer at or before the time scheduled for each monthly meeting.
A partner who fails to make such deposit must pay said amount at or prior to the next regular monthly meeting. Such payment is in addition to the payment due at said meeting. Any partner who has not paid her monthly deposit for the current meeting shall not be entitled to vote, except on propositions or parts thereof involving sale of securities, liquidation or dissolutions.
Any partner who fails to comply with the monthly deposit requirement shall be considered to have withdrawn from the partnership, unless otherwise determined by a majority vote of the members present at a regular monthly meeting.
Any partner who has an unplanned absence and is unable to deliver their check at the meeting may mail their check to the Treasurer to be postmarked within seven days and avoid penalties for late payment of dues. This will not avoid penalties for missed meetings.
c. Additional contributions
The partners may make additional contributions to The Club each month. No partner’s capital account shall exceed 20% of the capital accounts of all the partners.
d. Annual Fee
There will be no (zero) annual membership payment. Operating expenses will be paid out of general club monies. All expenses incurred will be assessed proportionally. The initial contribution will remain a $25 fee.
5. Value of the Partnership
The current value of the assets and property of the club, less the current value of the debts and liabilities of The Club shall be determined as of the close of business on Friday before the meeting, hereinafter be referred to a “valuation date”.
6. Capital Accounts
There shall be maintained in the name of each partner, a capital account. Any increase or decrease in the value of The Club on any valuation date shall be credited or debited, respectively, to each partner’s capital account in proportion to the value of each partner’s capital account on said date. Any other method of valuating each partner’s capital account may be substituted for this method, provided the substituted method results in exactly the same valuation as previously provided herein. Each partner’s capital contribution to, or capital withdrawal from, the partnership, shall be credited, or debited, respectively, to the partner’s capital account.
7. Sharing Profits and Losses
Net profits and losses of the partnership shall inure to, and be borne by, the partners in proportion to the valuation adjusted credit balances in their capital accounts or in proportion to valuation unit balances.
8. Books of account
Books of account of the transactions of The Club shall be kept and at all times be available and open to inspection and examination by any partner.
9. Annual Accounting
Each calendar year, a full and complete account of the condition of the partnership shall be made to the partners. In addition a review committee consisting of three persons including the current Treasurer and two non-officer members shall verify the records for the current year.
10. Bank Account
The partnership may select a bank or brokerage account  for the purpose of opening a partnership checking account. Funds deposited in said partnership checking account shall be withdrawn by checks signed by either of two partners designated by the partnership. That check signing authority is granted to the current Treasurer and President of the Club.
11. Broker Account
None of the partners of this partnership shall be a broker; however, the partnership will maintain a brokerage account at Scottrade  and enter into such agreements with the broker as required, for the purchase or sale of stocks, bonds, and securities. Stock, bonds, and securities owned by the partnership shall be registered in the partnership name unless another name shall be designated by the partnership.
Any corporation or transfer agent called upon to transfer any stocks, bonds, or securities to or from the name of the partnership shall be entitled to rely on instructions or assignment signed or purporting to be signed by any partner without inquiry as to the authority of the persons signing or purporting to sign such instructions or assignments or as to the validity of any transfer to or from the name of the partnership.
At the time of transfer, the corporation or transfer agent is entitled to assume (1) that the partnership is still in existence and (2) that this agreement is in full force and effect and has not been amended unless the corporation has received written notice to the contrary.
C. Account closure and partial withdrawal
A partner may withdraw a part or all of their shares after their last deposit has been invested at least thirty days. A partial withdrawal is limited to 50% of the withdrawing partner’s capital account. The Partner shall send written notice of withdrawal to the President, which shall become effective on the date the next regularly scheduled statement is prepared. Written notice shall be deemed received as of the first meeting of the partnership at which it is presented. If written notice is received between meetings it will be treated as having been received at the next following meeting. In making payment, the value of the partnership as set forth in the valuation statement prepared for the meeting at which written notice is received from a partner requesting a partial or full withdraw, will be used to determine the value of the partner’s capital account, adjusted for any dividends received to the date the notice was received. A partner withdrawing all of his shares shall be considered to have withdrawn from the partnership.
2. Partnership purchase
The other partners shall thereupon have and are hereby given the right during said period to purchase for their capital accounts in the partnership in proportion to their capital accounts in the partnership, the capital account of the withdrawing partner, subject to the 20% limit set forth above.
If the other partners do not exercise their option to purchase, then the partnership shall pay the withdrawing partner the value of his interest in the partnership as shown by the valuation statement in accordance with the terms of payment of this partnership agreement.
3. Terms of Payment
In the case of a partial withdrawal, payment shall be made in cash or securities at the option of a majority of the remaining partners. In the case of a full withdrawal, payment may be made in cash or securities or a mix of each at the option of the remaining partners. Where securities are to be distributed, the remaining partners select the securities.
4. Purchase Price
Upon the death, incapacity, or withdrawal of a partner, and the exercise of the option to purchase by the other partners, said other partners shall pay the withdrawing partner or his estate, as the case may be, a purchase price. The partnership shall transfer to the partner (or other appropriate entity) withdrawing a portion or all of her interest in the partnership, an amount equal to ninety-seven per cent (97%) of her capital account less the actual cost of selling sufficient securities to obtain the cash to meet the withdrawal. The amount being withdrawn shall be paid within 90 days, but no sooner than 50 days, after the valuation date used in determining the withdrawal amount. Any outstanding fines will be deducted from the final payment.
If a partner withdrawing a portion or all of the value of his capital account in the partnership desires an immediate payment in cash, the partnership at its earliest convenience may pay eighty percent (80%) of the estimated value of his capital account and settle the balance in accordance with the valuation and payment procedures set forth above.
When securities are transferred, the partnership shall select securities to transfer equal to the value of the capital account or a portion of the capital account being withdrawn (i.e. without a reduction for broker commissions). Securities shall be transferred as of the date of the club’s valuation statement prepared to determine the value of the partner’s capital account in the partnership. The Club’s broker, Scottrade , shall be advised that ownership of the securities has been transferred to the partner as of the valuation date used for the withdrawal.
When cash is required to meet a withdrawal, if necessary, the Partners will determine the assets to be sold before the date of the preparation of the liquidating value statement used to determine the value of the withdrawal.
5. Removal of a partner
A. Any partner may be removed by agreement of an absolute majority of partners. Written notice of a meeting where removal of a partner is to be considered shall include a specific reference to this matter. The removal shall become effective upon payment of the value of the removed partner’s capital account, which shall be in accordance with the provisions on full withdrawal of a partner.
B. The delinquent dues on the part of any member, will automatically constitute her “notice of withdrawal” if any two consecutive periods are outstanding.
C. In the years following the year a partner joins the Club any partner who fails to attend a minimum of eight regular monthly meetings per calendar year shall be considered to have withdrawn from the partnership, unless otherwise determined by a majority vote of the members present at a regular monthly meeting.
6. Death or Incapacity of a Partner
In the event of the death or incapacity of a partner, receipt of notice of such an event shall be treated as notice of full withdrawal, and a withdrawal penalty shall not be assessed. Liquidation and payment of the partner’s account shall proceed in accordance with paragraphs on withdrawal of this partnership agreement.
7. Dissolution of The Club
The Club may be dissolved by agreement of a collection of Partners whose capital accounts total a simple majority of the total of all Member capital accounts. The President or other Officer shall provide written notice of the decision to dissolve to all Members of The Club. Upon dissolution, all Club liabilities shall be paid and the remaining assets shall be distributed among the Partners either in cash or in kind to the partners or their personal representative in proportion to their capital valuation accounts on the date of distribution. Distribution of assets to Partners shall be accomplished not later than ninety (90) days following the date of the agreement to dissolve The Club.
Amendments to this agreement shall be made in the following manner:
a. Procedure. Any partner may submit a proposed amendment at a regularly scheduled meeting. The proposed amendment shall be in writing and distributed to all partners prior to the Discussion/Vote.
b. Discussion/Vote. The proposed amendment will be discussed and voted on at a meeting occurring not earlier than one month following publication. Approval of the proposed amendment shall require the affirmative vote of 2/3 of the partners present or by proxy, with the exception of this section (D. Amendments) which will require a unanimous vote.
This partnership and the partners do not, in any way, directly or indirectly, undertake to guarantee or promise to repay to any partner all or any portion of her contribution to the partnership. This provision is set forth herein in order to avoid application of (insert chapter), (insert state) Statutes.
4. A $3.00 fine will be levied for each meeting missed, after one free absence per calendar year.
5. A $1.00 fine will be levied for late arrival at a meeting.
6. A $5.00 fine will be levied for late payment of dues. Dues considered late if not paid by end of meeting.
7. Any outstanding fines will be deducted from the final payment of a resigned member.
VIII. FORBIDDEN ACTS
NO PARTNER SHALL:
A. Have the right or authority to bind or obligate The Club to any extent whatsoever with regard to any other matter outside the scope of The Club business.
B. Without the unanimous consent of all the other partners, assign, transfer, pledge, mortgage or sell all or part of their interest in The Club to any other partner or other whomsoever, or enter into any agreement as the result of which any persons not a partner shall have any interest in The Club.
C. Use The Club name, credit or property for other than Partnership purposes.
D. Do any act detrimental to the interest of The Club or which would make it impossible to carry on the business or affairs of The Club.
E. Purchase an investment for the partnership where less than the full purchase price is paid for same. (No buying on margin.)
F. Under any circumstances offer possible membership rights to any individual or group without the unanimous approval of the partnership.
This Agreement of Partnership is hereby declared and shall be binding upon the respective heirs, executors, administrators, and personal representatives of the Partners.
The partners have caused the Agreement of Partnership to be executed on the dates indicated below, effective as of the date indicated above.