Requires Notice or Oversight
Notice, Oversight or Filing of Hospital Conversions
Regulatory Action: REQUIREMENT
32 states have OVERSI regulations
AL AK AZ AR CA CO CT DE FL GA
HI ID IL IN IA KS KY LA ME MD
MA MI MN MS MO MT NE NV NH NJ
NM NY NC ND OH OK OR PA RI SC
SD TN TX UT VT VA WA WV WI WY
AZ Code § 10-11253
REGULATORY BODY: Attorney General
STATUTE TEXT: 10-11253. Public hearing; notice; requirements; summary report A. No later than ninety days before the anticipated closing of the intended transaction, any nonprofit health care entity that intends to engage in any of the transactions described in section 10-11252, subsection A shall give written notice to the director of the department of health services and the attorney general. The written notice shall include all of the following information: 1. The names, addresses and telephone numbers of the parties to the intended transaction. 2. The names, addresses and telephone numbers of the attorneys or other persons who represent the parties in connection with the intended transaction. 3. A general summary of the intended transaction. 4. A general description of the assets involved in the intended transaction and the intended use of the assets after the closing of the intended transaction. 5. A general summary of all collateral transactions that relate to the intended transaction, including the names, addresses and telephone numbers of the parties involved in the collateral transactions. 6. The anticipated date of completion of the intended transaction. B. The notice and information required pursuant to subsection A of this section and information submitted pursuant to subsection H of this section are public records. C. Within thirty days after the nonprofit health care entity sends the written notice prescribed in subsection A of this section, the parties to the intended transaction shall: 1. Select a hearing officer to conduct the public hearing required by this section and determine a time and place within this state for the public hearing with the agreement of the director of the department of health services. 2. Publish a notice of the time and place for the public hearing at least three consecutive times in at least one newspaper of general circulation in the county in which the nonprofit health care entity has its principal place of business. D. The hearing officer shall hold the public hearing within ten days after the last publication of the public notice. E. The purpose of the public hearing is to provide the information described in subsection F of this section and to receive comments from the public and other interested parties. F. The parties shall present written summary information at the public hearing that sets forth all of the following: 1. The extent to which the intended transaction impacts community benefit activities and is consistent with community benefit purposes, including a description of the resources that will be committed to community benefit purposes following the intended transaction. 2. Whether the intended transaction creates or has the likelihood of creating an adverse effect on the access to or availability or cost of health care services. 3. Whether any director, officer, agent or employee of the entity will receive any community benefit asset or will benefit directly or indirectly from the intended transaction, except for the receipt of compensation for professional services relating to the intended transaction for normal compensation for services rendered. 4. The extent to which the nonprofit health care entity used due diligence in the selection of the entity that will receive any community benefit asset and in the negotiation of the price and other terms and conditions of the transaction. 5. The extent to which the parties will continue to use the nonprofit health care entity’s community benefit assets for community benefit purposes following the intended transaction, or, if applicable, the proceeds of the disposition of the assets will be deposited in a community benefit organization for community benefit purposes. 6. Whether any initial board of directors members of any entity changed or created by the intended transaction will reside in or near the communities affected by the intended transaction. 7. That any community benefit organization established to hold the proceeds of the disposition of assets is organized for community benefit purposes as required under federal and state law. G. The attorney general may present information at the public hearing. H. The hearing officer conducting the public hearing shall compile a summary report of the public hearing proceedings and shall transmit the summary report, a notice of completion and copies of all written information presented at the hearing to the director of the department of health services and the attorney general. I. The parties to the intended transaction shall pay for all costs associated with the hearing officer, notice, publication of notice, public hearing and summary report.
NOTES: A.R.S. § 10-11253
AZ Code § 10-11253
REGULATORY BODY: Other
STATUTE TEXT: 10-11253. Public hearing; notice; requirements; summary report A. No later than ninety days before the anticipated closing of the intended transaction, any nonprofit health care entity that intends to engage in any of the transactions described in section 10-11252, subsection A shall give written notice to the director of the department of health services and the attorney general. The written notice shall include all of the following information: 1. The names, addresses and telephone numbers of the parties to the intended transaction. 2. The names, addresses and telephone numbers of the attorneys or other persons who represent the parties in connection with the intended transaction. 3. A general summary of the intended transaction. 4. A general description of the assets involved in the intended transaction and the intended use of the assets after the closing of the intended transaction. 5. A general summary of all collateral transactions that relate to the intended transaction, including the names, addresses and telephone numbers of the parties involved in the collateral transactions. 6. The anticipated date of completion of the intended transaction. B. The notice and information required pursuant to subsection A of this section and information submitted pursuant to subsection H of this section are public records. C. Within thirty days after the nonprofit health care entity sends the written notice prescribed in subsection A of this section, the parties to the intended transaction shall: 1. Select a hearing officer to conduct the public hearing required by this section and determine a time and place within this state for the public hearing with the agreement of the director of the department of health services. 2. Publish a notice of the time and place for the public hearing at least three consecutive times in at least one newspaper of general circulation in the county in which the nonprofit health care entity has its principal place of business. D. The hearing officer shall hold the public hearing within ten days after the last publication of the public notice. E. The purpose of the public hearing is to provide the information described in subsection F of this section and to receive comments from the public and other interested parties. F. The parties shall present written summary information at the public hearing that sets forth all of the following: 1. The extent to which the intended transaction impacts community benefit activities and is consistent with community benefit purposes, including a description of the resources that will be committed to community benefit purposes following the intended transaction. 2. Whether the intended transaction creates or has the likelihood of creating an adverse effect on the access to or availability or cost of health care services. 3. Whether any director, officer, agent or employee of the entity will receive any community benefit asset or will benefit directly or indirectly from the intended transaction, except for the receipt of compensation for professional services relating to the intended transaction for normal compensation for services rendered. 4. The extent to which the nonprofit health care entity used due diligence in the selection of the entity that will receive any community benefit asset and in the negotiation of the price and other terms and conditions of the transaction. 5. The extent to which the parties will continue to use the nonprofit health care entity’s community benefit assets for community benefit purposes following the intended transaction, or, if applicable, the proceeds of the disposition of the assets will be deposited in a community benefit organization for community benefit purposes. 6. Whether any initial board of directors members of any entity changed or created by the intended transaction will reside in or near the communities affected by the intended transaction. 7. That any community benefit organization established to hold the proceeds of the disposition of assets is organized for community benefit purposes as required under federal and state law. G. The attorney general may present information at the public hearing. H. The hearing officer conducting the public hearing shall compile a summary report of the public hearing proceedings and shall transmit the summary report, a notice of completion and copies of all written information presented at the hearing to the director of the department of health services and the attorney general. I. The parties to the intended transaction shall pay for all costs associated with the hearing officer, notice, publication of notice, public hearing and summary report.
NOTES: A.R.S. § 10-11253
CA Code § 5914
REGULATORY BODY: Attorney General
STATUTE TEXT: (a)(1)Any nonprofit corporation that is defined in Section 5046 and operates or controls a health facility, as defined in Section 1250 of the Health and Safety Code, or operates or controls a facility that provides similar health care, regardless of whether it is currently operating or providing health care services or has a suspended license, shall be required to provide written notice to, and to obtain the written consent of, the Attorney General prior to entering into any agreement or transaction to do either of the following: (A)Sell, transfer, lease, exchange, option, convey, or otherwise dispose of, its assets to a for-profit corporation or entity or to a mutual benefit corporation or entity when a material amount of the assets of the nonprofit corporation are involved in the agreement or transaction. Terms Used In California Corporations Code 5914Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.County: includes “city and county. See California Education Code 17491department: whenever used in this code , unless the context otherwise requires, means the State Department of Education. See California Education Code 89Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCCState: means the State of California, unless applied to the different parts of the United States. See California Education Code 77 (B)Transfer control, responsibility, or governance of a material amount of the assets or operations of the nonprofit corporation to any for-profit corporation or entity or to any mutual benefit corporation or entity. (2)The substitution of a new corporate member or members that transfers the control of, responsibility for, or governance of the nonprofit corporation shall be deemed a transfer for purposes of this article. The substitution of one or more members of the governing body, or any arrangement, written or oral, that would transfer voting control of the members of the governing body, shall also be deemed a transfer for purposes of this article. (b)The notice to the Attorney General provided for in this section shall include and contain the information the Attorney General determines is required. The notice, including any other information provided to the Attorney General under this article, and that is in the public file, shall be made available by the Attorney General to the public in written form, as soon as is practicable after it is received by the Attorney General. The notice shall include a list of the primary languages spoken at the facility and the threshold languages for Medi-Cal beneficiaries, as determined by the State Department of Health Care Services for the county in which the facility is located. The Attorney General may require the nonprofit corporation to provide certain components of the notice in any of these languages. (c)This section shall not apply to a nonprofit corporation if the agreement or transaction is in the usual and regular course of its activities or if the Attorney General has given the corporation a written waiver of this section as to the proposed agreement or transaction. (d)This section shall apply to any foreign nonprofit corporation that operates or controls a health facility, as defined in Section 1250 of the Health and Safety Code, or a facility that provides similar health care, regardless of whether it is currently operating or providing health care services or has a suspended license. (Amended by Stats. 2017, Ch. 782, Sec. 1. (AB 651) Effective January 1, 2018.)
NOTES: Cal. Corp. Code § 5914
CO Code § 6-19-103
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: C.R.S. § 6-19-103
CT Code § 19a-486a
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: C.G.S. § 19a-486a
CT Code § 19a-486a
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Commissioner of Public Health, C.G.S. § 19a-486a
DE Code § 2532
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Del. Code Ann. tit. 29, § 2532
FL Code § 155.40
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Fla. Stat. Ann. § 155.40
GA Code § 14-3-1041
REGULATORY BODY: Attorney General
STATUTE TEXT: (a) A corporation described in paragraph (2) of subsection (a) of Code Section 14-3-1302 may amend its articles of incorporation as provided in Code Section 14-3-1040 only: (1) Upon the prior approval of the superior court in a proceeding in which the Attorney General has been given notice; or (2) If on or before the effective date of the amendment: (A) Assets with a value equal to the greater of the fair market value of the net tangible and intangible assets (including good will) of the corporation, or the fair market value of the corporation if it were to be operated as a business concern, are transferred or conveyed to one or more persons who would have received its assets under subsection (b) of Code Section 14-3-1403 had it dissolved; (B) It shall return, transfer, or convey any assets held by it upon condition requiring return, transfer, or conveyance, which condition occurs by reason of the amendment, in accordance with such condition; and (C) The amendment is approved by a majority of the directors of the corporation who are not and will not become shareholders in, or officers, employees, agents, or consultants of the corporation following the effective date of the amendment. (b) At least 30 days before the filing of any amendment described in Code Section 14-3-1040 by a corporation described in subsection (a) of this Code section, notice of the proposed amendment shall be delivered to the Attorney General. (c) Without the prior written consent of the superior court in a proceeding of which the Attorney General has been given notice, no member of a corporation described in subsection (a) of this Code section may receive or keep anything as a result of an amendment described in Code Section 14-3-1040. The court shall approve the transaction if it is in the public interest.
NOTES: Ga. Code Ann., § 14-3-1041
GA Code § 14-3-1005
REGULATORY BODY: Other
STATUTE TEXT: A corporation amending its articles shall deliver to the Secretary of State for filing articles of amendment setting forth: (1) The name of the corporation; (2) The text of each amendment adopted; (3) The date of each amendment’s adoption; (4) If approval of members was not required, a statement to that effect and a statement that the amendment was approved by a sufficient vote of the board of directors or incorporators; (5) If approval by members was required, a statement that the amendment was duly approved by the members in accordance with the provisions of Code Section 14-3-1003; and (6) If approval of the amendment by some person or persons other than the members, the board, or the incorporators is required pursuant to Code Section 14-3-1030 or 14-3-1041, a statement that the approval was obtained.
NOTES: Ga. Code Ann. § 14-3-1005
HI Code § 28-5.2
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: H.R.S. § 28-5.2
HI Code § 432C-3
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Insurance commissioner, HRS § 432C-3
ID Code § 48-1503
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: I.C. § 48-1503
IL Code § 415/104
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: 805 ILCS 415/104
IL Code § 415/104
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: 805 ILCS 415/104
IA Code § 504.111
REGULATORY BODY: Other
STATUTE TEXT: 504.111 Filing requirements. 1. A document must satisfy the requirements of this section, and of any other section that adds to or varies these requirements, to be entitled to filing by the secretary of state. 2. This chapter must require or permit filing the document in the office of the secretary of state. 3. The document must contain the information required by this chapter. It may contain other information as well. 4. The document must be typewritten or printed. If the document is electronically transmitted, it must be in a format that can be retrieved or reproduced in typewritten or printed form. 5. The document must be in the English language. However, a corporate name need not be in English if written in English letters or Arabic or Roman numerals. The certificate of existence required of foreign corporations need not be in English if accompanied by a reasonably authenticated English translation. 6. The document must be executed by one of the following: a. The presiding officer of the board of directors of a domestic or foreign corporation, its president, or by another of its officers. b. If directors have not been selected or the corporation has not been formed, by an incorporator. c. If the corporation is in the hands of a receiver, trustee, or other court-appointed fiduciary, by that fiduciary. 7. The person executing a document shall sign it and state beneath or opposite the signature the personis name and the capacity in which the person signs. The document may contain a corporate seal, an attestation, an acknowledgment, or a verification. 8. If the secretary of state has prescribed a mandatory form for a document under section 504.112, the document must be in or on the prescribed form. 9. The document must be delivered to the office of the secretary of state for filing. Delivery may be made by electronic transmission if and to the extent permitted by the secretary of state. If it is filed in typewritten or printed form and not transmitted electronically, the secretary of state may require one exact or conformed copy to be delivered with the document, except as provided in sections 504.503 and 504.1509. 10. When the document is delivered to the office of the secretary of state for filing, the correct filing fee, and any franchise tax, license fee, or penalty, shall be paid in a manner permitted by the secretary of state. 11. The secretary of state may adopt rules for the electronic filing of documents and the certification of electronically filed documents. 12. Whenever a provision of this chapter permits any of the terms of a plan or a filed document to be dependent on facts objectively ascertainable outside the plan or filed document, all of the following provisions apply: a. The manner in which the facts will operate upon the terms of the plan or filed document shall be set forth in the plan or filed document. b. The facts may include any of the following: (1) Any of the following that is available in a nationally recognized news or information medium either in print or electronically: statistical or market indices, market prices of any security or group of securities, interest rates, currency exchange rates, or similar economic or financial data. (2) A determination or action by any person or body, including the corporation or any other party to a plan or filed document. (3) The terms of, or actions taken under, an agreement to which the corporation is a party, or any other agreement or document. c. As used in this subsection, all of the following apply: (1) iFiled documenti means a document filed with the secretary of state under any provision of this chapter except subchapter XV or section 504.1613. (2) iPlani means a plan of entity conversion or merger. 2004 Acts, ch 1049, ss3, 192; 2005 Acts, ch 19, ss77; 2015 Acts, ch 45, ss2 Referred to in ss504.116, 504.1104
NOTES: Iowa Code Ann. § 504.111
HOSPCON-OVERSI-AG
REGULATORY BODY: Attorney General
NOTES: La. Rev. Stat. Ann. 40:2115.11
ME Code § 194-C
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Me. Rev. Stat. tit. 5, § 194-C
MD Code § 6.5-102
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Md. Code Ann., State Gov’t § 6.5-102, Md. Code Ann., State Gov’t § 6.5-101: “‘Regulating entity’ means: (1) for an acquisition of a nonprofit hospital, the Attorney General in consultation with the Department; (2) for an acquisition of a nonprofit health service plan, the Administration; and (3) for an acquisition of a nonprofit health maintenance organization, the Administration.”
MD Code § 6.5-101
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Md. Code Ann., State Gov’t § 6.5-102, Md. Code Ann., State Gov’t § 6.5-101: “‘Regulating entity’ means: (1) for an acquisition of a nonprofit hospital, the Attorney General in consultation with the Department; (2) for an acquisition of a nonprofit health service plan, the Administration; and (3) for an acquisition of a nonprofit health maintenance organization, the Administration.”
MD Code § 6.5-102
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Md. Code Ann., State Gov’t § 6.5-102, Md. Code Ann., State Gov’t § 6.5-101: “‘Regulating entity’ means: (1) for an acquisition of a nonprofit hospital, the Attorney General in consultation with the Department; (2) for an acquisition of a nonprofit health service plan, the Administration; and (3) for an acquisition of a nonprofit health maintenance organization, the Administration.”
MD Code § 6.5-101
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Md. Code Ann., State Gov’t § 6.5-102, Md. Code Ann., State Gov’t § 6.5-101: “‘Regulating entity’ means: (1) for an acquisition of a nonprofit hospital, the Attorney General in consultation with the Department; (2) for an acquisition of a nonprofit health service plan, the Administration; and (3) for an acquisition of a nonprofit health maintenance organization, the Administration.”
MA Code § 8A
REGULATORY BODY: Attorney General
STATUTE TEXT: Section 8A. (a) A corporation may authorize, by vote of two-thirds of its members entitled to vote thereon or, in the case of a corporation having capital stock, by the holders of two-thirds of its capital stock entitled to vote thereon, at a meeting duly called for the purpose, with notice given as provided in section six B, the sale, lease, exchange or other disposition of all or substantially all of its property and assets upon such terms and conditions as it deems expedient, except that no such vote shall be required if such transaction does not involve or will not result in a material change in the nature of the activities conducted by the corporation. (b) The authorization by members of the mortgage or pledge of, or granting of a security interest in, property or assets of a corporation shall not be necessary except to the extent that the corporation’s articles of organization or by-laws provide otherwise. (c) A corporation constituting a public charity shall give written notice to the attorney general not less than thirty days before making any sale, lease, exchange, or other disposition not referred to in subsection (b) of all or substantially all of its property and assets if that sale, lease, exchange or other disposition involves or will result in a material change in the nature of the activities conducted by the corporation, except that no such notice shall be required if a written waiver of such notice is executed by the attorney general before or after such sale, lease, exchange or other disposition. A certificate signed by an officer of the corporation which states that notice was not required, that notice was given, or that notice was waived by the attorney general, with respect to any sale, lease, exchange or other disposition of property by the corporation shall be conclusive in favor of any purchaser, lessee, transferee or other person relying thereon for purposes of determining compliance with the provisions of this subsection. (d)(1) A nonprofit acute-care hospital, as defined in section 25B of chapter 111, or a nonprofit health maintenance organization as defined in chapter 176G shall give written notice of not less than 90 days to the attorney general and to the commissioner of public health if such notice concerns a nonprofit health maintenance organization, before it enters into a sale, lease, exchange, or other disposition of a substantial amount of its assets or operations with a person or entity other than a public charity. No such notice shall be required if a written waiver of such notice is executed by the attorney general. When investigating the proposed transaction, the attorney general shall consider any factors that the attorney general deems relevant, including, but not limited to, whether: (i) the proposed transaction complies with applicable general nonprofit and charities law; (ii) due care was followed by the nonprofit entity; (iii) conflict of interest was avoided by the nonprofit entity at all phases of decision making; (iv) fair value will be received for the nonprofit assets; and (v) the proposed transaction is in the public interest. (2) The attorney general shall assess the entity proposing to receive such assets or operations for reasonable costs related to, and shall expend such amounts for the review of the proposed transaction, as determined by the attorney general to be necessary. Such reasonable costs may include expert review of the transaction, a process for educating the public about the transaction and obtaining public input, and administrative costs. All materials filed by the parties in the course of the attorney general’s review shall be made available for public inspection pursuant to section 10 of chapter 66 and section 7 of chapter 4. (3) The attorney general shall, during the course of his investigation, hold at least one public hearing, in a location convenient to the population served by the nonprofit entity, at which any person may file written comments and exhibits or appear and make a statement. At least 21 days in advance of the public hearing, the nonprofit entity shall publish notice of the hearing in a newspaper of general circulation where the entity is located. The notice shall include the name of the nonprofit entity, the name of the acquirer, or other parties to the proposed transaction, the nature of the proposed transaction and the anticipated consideration that will be paid by the acquirer. In addition, the notice shall offer to provide to any person upon request to the nonprofit entity a detailed summary of the proposed transaction and copies of all transaction and collateral agreements. As defined in section 7 of chapter 4, compliance with this notice requirement will not require disclosure of confidential trade secret, commercial or financial information contained in schedules or exhibits of those agreements. (4) If a charitable fund results from the transaction, and if the nonprofit entity making the disposition does not continue its operation of a nonprofit hospital or nonprofit health maintenance organization, the governance of the charitable fund shall be subject to review by the attorney general and approval by the court. The governance of the charitable fund shall be broadly based in the community historically served by the predecessor nonprofit acute care hospital or health maintenance organization and shall be independent of the new for-profit entity. The attorney general shall conduct a public hearing in connection with his review of the plan for the governance of the resulting charitable fund. An appropriate portion of any resulting proceeds shall, if determined to be necessary by the attorney general, be used for assistance in the development of a community-based plan for the use of the resulting charitable fund. (5) The entity receiving such assets or operations shall, if determined to be necessary by the attorney general in consultation with the department of public health, provide the funds, in an amount determined by the commissioner of public health, for the hiring by the department of public health of an independent health care access monitor to monitor and report quarterly to the attorney general, the department of public health and the committee on health care on community health care access by the entity, including levels of free care provided by the entity. The funding shall be provided for three years after the transaction. The entity receiving such assets or operations shall provide the monitor with appropriate access to the entity’s records in order to enable the monitor to fulfill this function. To prevent the duplication of any information already reported by the entity, the monitor shall, to the extent possible, utilize data already provided by the entity to the center for health information and analysis under chapter 12C or to any other agency. No personal identifiers shall be attached to any of the records obtained by the monitor and all such records shall be subject to the privacy and confidentiality provisions of section 70E of chapter 111. (6) No officer, director, incorporator, member, employee, staff, physician, expert or advisor of the nonprofit entity making the disposition shall derive improper benefit from the transaction. The officers, directors, incorporators, members, senior managers, staff, physicians, experts and advisors of the nonprofit entity making the disposition shall be prohibited from investing in the for-profit entity for a period of three years following such disposition.
NOTES: Mass. Gen. Laws Ann. ch. 180, § 8A
MA Code § 8A
REGULATORY BODY: Other
STATUTE TEXT: Section 8A. (a) A corporation may authorize, by vote of two-thirds of its members entitled to vote thereon or, in the case of a corporation having capital stock, by the holders of two-thirds of its capital stock entitled to vote thereon, at a meeting duly called for the purpose, with notice given as provided in section six B, the sale, lease, exchange or other disposition of all or substantially all of its property and assets upon such terms and conditions as it deems expedient, except that no such vote shall be required if such transaction does not involve or will not result in a material change in the nature of the activities conducted by the corporation. (b) The authorization by members of the mortgage or pledge of, or granting of a security interest in, property or assets of a corporation shall not be necessary except to the extent that the corporation’s articles of organization or by-laws provide otherwise. (c) A corporation constituting a public charity shall give written notice to the attorney general not less than thirty days before making any sale, lease, exchange, or other disposition not referred to in subsection (b) of all or substantially all of its property and assets if that sale, lease, exchange or other disposition involves or will result in a material change in the nature of the activities conducted by the corporation, except that no such notice shall be required if a written waiver of such notice is executed by the attorney general before or after such sale, lease, exchange or other disposition. A certificate signed by an officer of the corporation which states that notice was not required, that notice was given, or that notice was waived by the attorney general, with respect to any sale, lease, exchange or other disposition of property by the corporation shall be conclusive in favor of any purchaser, lessee, transferee or other person relying thereon for purposes of determining compliance with the provisions of this subsection. (d)(1) A nonprofit acute-care hospital, as defined in section 25B of chapter 111, or a nonprofit health maintenance organization as defined in chapter 176G shall give written notice of not less than 90 days to the attorney general and to the commissioner of public health if such notice concerns a nonprofit health maintenance organization, before it enters into a sale, lease, exchange, or other disposition of a substantial amount of its assets or operations with a person or entity other than a public charity. No such notice shall be required if a written waiver of such notice is executed by the attorney general. When investigating the proposed transaction, the attorney general shall consider any factors that the attorney general deems relevant, including, but not limited to, whether: (i) the proposed transaction complies with applicable general nonprofit and charities law; (ii) due care was followed by the nonprofit entity; (iii) conflict of interest was avoided by the nonprofit entity at all phases of decision making; (iv) fair value will be received for the nonprofit assets; and (v) the proposed transaction is in the public interest. (2) The attorney general shall assess the entity proposing to receive such assets or operations for reasonable costs related to, and shall expend such amounts for the review of the proposed transaction, as determined by the attorney general to be necessary. Such reasonable costs may include expert review of the transaction, a process for educating the public about the transaction and obtaining public input, and administrative costs. All materials filed by the parties in the course of the attorney general’s review shall be made available for public inspection pursuant to section 10 of chapter 66 and section 7 of chapter 4. (3) The attorney general shall, during the course of his investigation, hold at least one public hearing, in a location convenient to the population served by the nonprofit entity, at which any person may file written comments and exhibits or appear and make a statement. At least 21 days in advance of the public hearing, the nonprofit entity shall publish notice of the hearing in a newspaper of general circulation where the entity is located. The notice shall include the name of the nonprofit entity, the name of the acquirer, or other parties to the proposed transaction, the nature of the proposed transaction and the anticipated consideration that will be paid by the acquirer. In addition, the notice shall offer to provide to any person upon request to the nonprofit entity a detailed summary of the proposed transaction and copies of all transaction and collateral agreements. As defined in section 7 of chapter 4, compliance with this notice requirement will not require disclosure of confidential trade secret, commercial or financial information contained in schedules or exhibits of those agreements. (4) If a charitable fund results from the transaction, and if the nonprofit entity making the disposition does not continue its operation of a nonprofit hospital or nonprofit health maintenance organization, the governance of the charitable fund shall be subject to review by the attorney general and approval by the court. The governance of the charitable fund shall be broadly based in the community historically served by the predecessor nonprofit acute care hospital or health maintenance organization and shall be independent of the new for-profit entity. The attorney general shall conduct a public hearing in connection with his review of the plan for the governance of the resulting charitable fund. An appropriate portion of any resulting proceeds shall, if determined to be necessary by the attorney general, be used for assistance in the development of a community-based plan for the use of the resulting charitable fund. (5) The entity receiving such assets or operations shall, if determined to be necessary by the attorney general in consultation with the department of public health, provide the funds, in an amount determined by the commissioner of public health, for the hiring by the department of public health of an independent health care access monitor to monitor and report quarterly to the attorney general, the department of public health and the committee on health care on community health care access by the entity, including levels of free care provided by the entity. The funding shall be provided for three years after the transaction. The entity receiving such assets or operations shall provide the monitor with appropriate access to the entity’s records in order to enable the monitor to fulfill this function. To prevent the duplication of any information already reported by the entity, the monitor shall, to the extent possible, utilize data already provided by the entity to the center for health information and analysis under chapter 12C or to any other agency. No personal identifiers shall be attached to any of the records obtained by the monitor and all such records shall be subject to the privacy and confidentiality provisions of section 70E of chapter 111. (6) No officer, director, incorporator, member, employee, staff, physician, expert or advisor of the nonprofit entity making the disposition shall derive improper benefit from the transaction. The officers, directors, incorporators, members, senior managers, staff, physicians, experts and advisors of the nonprofit entity making the disposition shall be prohibited from investing in the for-profit entity for a period of three years following such disposition.
NOTES: Commissioner of Public Health, Mass. Gen. Laws Ann. ch. 180, § 8A
MT Code § 50-4-702
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Mont. Code Ann. § 50-4-702
MT Code § 50-4-702
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Montana state auditor and ex officio commissioner of insurance, Mont. Code Ann. § 50-4-702
NE Code § 71-20
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Neb. Rev. Stat. § 71-20,104
NE Code § 71-20
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Neb. Rev. Stat. § 71-20,104
NH Code § 7:19-b
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: N.H. Rev. Stat. Ann. § 7:19-b
NJ Code § 26:2H-7.11
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: N.J. Stat. Ann. § 26:2H-7.11
NJ Code § 26:2H-7.11
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Commissioner of Health, N.J. Stat. Ann. § 26:2H-7.11
NC Code § 58-65-133
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: N.C. Gen. Stat. § 58-65-133
NC Code § 58-65-132
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Commissioner of Insurance, N.C. Gen. Stat. § 58-65-132
ND Code § 10-33-145
REGULATORY BODY: Attorney General
STATUTE TEXT: 1.Upon receipt of a notice under section 10-33-144, the attorney general may review and investigate the proposed agreement or transaction and may require the nonprofit corporation or entity operating or controlling a hospital or nursing home and the other parties to the agreement or transaction to provide to the attorney general any additional information relevant to the review or investigation of the proposed agreement or transaction.2.Upon receipt of a notice under section 10-33-144, the attorney general may review the proposed agreement or transaction to determine whether consummation of the proposed agreement or transaction by the nonprofit corporation or entity operating or controlling a hospital or nursing home is consistent with the purposes of the nonprofit corporation or entity operating or controlling a hospital or nursing home and the fiduciary obligations of the officers and directors of the nonprofit corporation or entity operating or controlling a hospital or nursing home and is in accordance with law. The attorney general shall consider the following factors in reviewing and evaluating a proposed agreement or transaction:a. Whether appropriate steps were taken by the nonprofit corporation or entity operating or controlling a hospital or nursing home to safeguard restricted assets transferred to the acquiring entity;b. Whether appropriate steps were taken by the nonprofit corporation or entity operating or controlling a hospital or nursing home to ensure that any proceeds of the proposed agreement or transaction are used for purposes consistent with restrictions placed on assets of and with the purposes of the nonprofit corporation or entity operating or controlling a hospital or nursing home;c.Whether the terms and conditions of the proposed agreement or transaction are fair and reasonable to the nonprofit corporation or entity operating or controlling a hospital or nursing home, including whether the nonprofit corporation or entity operating or controlling the hospital or nursing home will receive fair market value for its assets and, in a proposed agreement or transaction involving a nursing home, whether the proposed agreement or transaction constitutes a bona fide transaction;d.Whether any conflict of interest or breach of fiduciary duty exists or was disclosed, including any conflict of interest or breach of fiduciary duty related to directors and officers of, executives of, and experts retained by the nonprofit corporation or entity operating or controlling a hospital or nursing home and any other party to the agreement or transaction;e.Whether the agreement or transaction will result in inurement, pecuniary gain, or excess benefit to any person associated with the nonprofit corporation or entity operating or controlling a hospital or nursing home or to any other person;f.Whether the transaction is in the best interests of the nonprofit corporation or entity operating or controlling a hospital or nursing home; andg.Whether the transaction is authorized by the nonprofit corporation’s governing records.3.For the purpose of reviewing and evaluating the factors identified in subsection 2, the attorney general may retain experts if necessary and reasonable and may obtain public comment regarding the proposed agreement or transaction. A contract entered by the attorney general with an expert under this section does not require a bid and is exempt from chapters 44-08 and 54-44.4. If the attorney general intends to seek payment from the nonprofit corporation or entity operating or controlling a hospital or nursing home for the cost of any expert retained under this subsection, at least five days before retaining that expert, the attorney general shall notify the nonprofit corporation or entity operating or controlling a hospital or nursing home of the expert cost projected to be incurred. A nonprofit corporation or entity operating or controlling a hospital or nursing home which receives notice under this subsection shall pay the reasonable cost of any retained expert. If the nonprofit corporation or entity operating or controlling a hospital or nursing home objects to paying the costs of an expert, the corporation or entity may seek a district court order limiting the corporation’s or entity’s liability for the costs. In determining whether to issue an order, the court shall consider whether the expert is necessary and reasonable and the cost of the expert relative to the value of the proposed agreement or transaction.4.Section 44-04-18.4 applies to any information provided to the attorney general under sections 10-33-144 through 10-33-147.5.All costs, fees, and other moneys received under sections 10-33-144 through 10-33-149 must be deposited into the attorney general’s operating fund. The moneys in the fund are appropriated to pay the costs incurred in the attorney general’s performance of responsibilities pursuant to sections 10-33-144 through 10-33-149.
NOTES: N.D. Cent. Code Ann. § 10-33-145
OH Code § 3913.38
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Ohio Rev. Code Ann. § 3913.38
OR Code § 65.803 ;; 65-803
REGULATORY BODY: Attorney General
STATUTE TEXT: (1) Any public benefit or religious corporation that operates a hospital must provide written notice to, and obtain the written approval of, the Attorney General before closing any transaction to do either of the following:(a) Sell, transfer, lease, exchange, option, convey, merge or otherwise dispose of all or a significant portion of its hospital assets to a noncharitable entity or to an unrelated charitable entity. (b) Transfer control, responsibility or governance of a significant portion of the hospital assets or hospital operations of the public benefit or religious corporation to a noncharitable entity. (2) This section does not apply to a public benefit or religious corporation if any of the following apply: (a) The transaction is in the usual and regular course of the activities of the public benefit or religious corporation. (b) The public benefit or religious corporation has furnished the Attorney General with a detailed written statement describing the proposed transaction and requesting a written waiver of the requirements imposed by this section, and the Attorney General: (A) Has given the public benefit or religious corporation a written waiver of the requirements imposed by this section as to the proposed transaction; or (B) Has not made a written determination with regard to the request within 45 days after receiving the request. (c) The Attorney General, by rule, has excepted this kind of transaction. (3) The notice and approval required by ORS 65.800 to 65.815 are in addition to any other notice or approval required by this chapter or other applicable law. (4) Notice and approval is not required under ORS 65.800 to 65.815 if a political subdivision of the state controls the operation of the hospital. (5) Any person may make a written request to the Attorney General that the person be given notice of requests for approval received by the Attorney General under this section. The Attorney General shall maintain a mailing list of persons who have requested notification under this subsection and shall promptly mail a copy of any request for approval received under this section to the persons on the list. In addition, the Attorney General shall promptly mail a copy of any request for waiver received under subsection (2) of this section to the persons on the list upon receiving the request for waiver. The Attorney General may not grant a waiver under subsection (2) of this section until 14 days after the mailing required by this subsection. [1997 c.291 ss3]
NOTES: O.R.S. § 65.803
PA Code § 5547
REGULATORY BODY: Attorney General
STATUTE TEXT: ss 5547. Authority to take and hold trust property.(a) General rule.–Every nonprofit corporation incorporated for a charitable purpose or purposes may take, receive and hold such real and personal property as may be given, devised to, or otherwise vested in such corporation, in trust, for the purpose or purposes set forth in its articles. The board of directors or other body of the corporation shall, as trustees of such property, be held to the same degree of responsibility and accountability as if not incorporated, unless a less degree or a particular degree of responsibility and accountability is prescribed in the trust instrument, or unless the board of directors or such other body remain under the control of the members of the corporation or third persons who retain the right to direct, and do direct, the actions of the board or other body as to the use of the trust property from time to time. (b) Nondiversion of certain property.–Property committed to charitable purposes shall not, by any proceeding under Chapter 59 (relating to fundamental changes) or otherwise, be diverted from the objects to which it was donated, granted or devised, unless and until the board of directors or other body obtains from the court an order under 20 Pa.C.S. Ch. 77 (relating to trusts) specifying the disposition of the property. (Dec. 21, 1988, P.L.1444, No.177, eff. Oct. 1, 1989; Oct. 27, 2010, P.L.837, No.85, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days) 2013 Amendment. Act 67 amended subsec. (b). Cross References. Section 5547 is referred to in sections 202, 5548, 5549, 5746, 5916, 5930, 5976, 5989 of this title.
NOTES: 15 Pa.C.S.A. § 5547
RI Code § 23-17.14-7
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: R.I. Gen. Laws Ann. § 23-17.14-7
RI Code § 23-17.14-8
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Department of Health, R.I. Gen. Laws Ann. § 23-17.14-8
SD Code § 47-25A-2
REGULATORY BODY: Attorney General
STATUTE TEXT: 47-25A-2. Required approvals. If a domestic or foreign nonprofit corporation may not be a party to a merger or sale of its assets without the approval of the attorney general, the Division of Insurance, or the Public Utilities Commission, the corporation may not be a party to a conversion or domestication without the prior approval of that agency.Source: SL 2016, ch 221, ss 17.
NOTES: SDCL § 47-25A-2
SD Code § 47-25A-10
REGULATORY BODY: Other
STATUTE TEXT: 47-25A-10. Articles of for-profit conversion. (a) Articles of for-profit conversion must be signed on behalf of the converting corporation by any officer or other duly authorized representative. The articles must set forth:(1) If the surviving corporation is a domestic business corporation, the name of the corporation immediately before the filing of the articles of for-profit conversion and if that name does not satisfy the requirements of the business corporation act, or the corporation desires to change its name in connection with the conversion, a name that satisfies the requirements of the business corporation act;(2) If the surviving corporation is a foreign business corporation, its name after the conversion and its jurisdiction of incorporation; and(3) A statement that the plan of for-profit conversion was duly approved by the members in the manner required by this chapter and the articles of incorporation.(b) If the surviving corporation is a domestic business corporation, the articles of for-profit conversion shall either contain all of the provisions that the business corporation act requires to be set forth in the articles of incorporation of a domestic business corporation and any other desired provisions permitted by the business corporation act, or shall have attached articles of incorporation that satisfy the requirements of the business corporation act. In either case, provisions that would not be required to be included in restated articles of incorporation of a domestic business corporation may be omitted, except that the name and address of the initial registered agent of the business corporation must be included.(c) The articles of for-profit conversion must be delivered to the Office of the Secretary of State for filing.Source: SL 2016, ch 221, ss 25.
NOTES: SDCL § 47-25A-10; SDCL § 47-25A-20
SD Code § 47-25A-20
REGULATORY BODY: Other
STATUTE TEXT: 47-25A-20. Plan of nonprofit conversion. (a) The plan of nonprofit conversion must be adopted by the shareholders. The plan for nonprofit conversion must include:(1) The terms and conditions of the conversion;(2) The manner and basis of reclassifying the shareholders in the corporation;(3) Any desired amendments to the articles of incorporation or bylaws of the corporation following its conversion;(4) The articles of incorporation to be in effect immediately following the conversion; and(5) Any of the terms or conditions of the plan if the change would adversely affect any of the shareholders in any material respect.The plan for nonprofit conversion may also include a provision that the plan may be amended prior to filing articles of nonprofit conversion.(b) After the plan for nonprofit conversion is authorized, the articles of conversion must be signed on behalf of the converting corporation by any officer or other duly authorized representative.The articles shall set forth:(1) The name of the corporation immediately before the filing of the articles of conversion and, if that name is unavailable for use in this state or the corporation desires to change its name in connection with the conversion, a name that satisfies the requirements of ss ss 47-22-7 and 47-22-8.1;(2) The jurisdiction of incorporation of the corporation immediately before the filing of the articles of conversion and the date the corporation was incorporated; and(3) A statement that the conversion of the corporation in this state was duly authorized as required by the laws of this state.(c) The articles of conversion shall contain all of the provisions required to be contained in the articles of incorporation of a nonprofit corporation as set forth in ss 47-22-6 and any other desired provisions permitted to be included. Provisions that would not be required to be included in restated articles of incorporation may be omitted, except that the name and address of the initial registered agent of the domestic business corporation must be included.(d) The articles of nonprofit conversion must be delivered to the Office of the Secretary of State for filing.Source: SL 2016, ch 221, ss 35.
NOTES: SDCL § 47-25A-10; SDCL § 47-25A-20
TN Code § 48-68-203
REGULATORY BODY: Attorney General
STATUTE TEXT: (a) Notwithstanding chapters 61 and 64 of this title, any public benefit hospital entity shall be required to provide written notice to the attorney general and reporter, prior to entering into any public benefit hospital conveyance transaction. At the time of providing notice to the attorney general and reporter, the public benefit hospital entity shall provide the attorney general and reporter with written certification that a copy of this part has been given in its entirety to each member of the board of trustees of the public benefit hospital entity. (b) The notice to the attorney general and reporter provided for in this section shall include and contain all the information the attorney general and reporter determines is required. No notice shall be effective until the attorney general and reporter has acknowledged receipt of a complete notice, in accordance with protocol established by the attorney general and reporter. (c) This part shall not apply to a public benefit hospital entity, if the public benefit hospital conveyance transaction is in the usual and regular course of its activities, and if the attorney general and reporter has given the public benefit hospital entity a written waiver of this part as to the public benefit hospital conveyance transaction.
NOTES: Tenn. Code Ann. § 48-68-203
VT Code § 9420
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Vt. Stat. Ann. tit. 18, § 9420
VT Code § 9420
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Vt. Stat. Ann. tit. 18, § 9420
VA Code § 55-532
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Va. Code Ann. § 55-532
WA Code § 70.45.060
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: Wash. Rev. Code Ann. § 70.45.060
WA Code § 70.45.060
REGULATORY BODY: Other
STATUTE TEXT:
NOTES: Wash. Rev. Code Ann. § 70.45.060
DC Code § 44-603
REGULATORY BODY: Attorney General
STATUTE TEXT:
NOTES: DC ST § 44-603
WI Code § 181.1161
REGULATORY BODY: Other
STATUTE TEXT: 181.1161 Conversion. (1) (a) A domestic corporation may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic corporation is converting.(b) In addition to satisfying any applicable legal requirements of the jurisdiction that governs the organization of the business entity into which the domestic corporation is converting and that relate to the submission and approval of a plan of conversion, the domestic corporation shall comply with the procedures that govern a plan of merger under s. 181.1103 for the submission and approval of a plan of conversion. (2) (a) A business entity other than a domestic corporation may convert to a domestic corporation if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the business entity.(b) A business entity converting into a domestic corporation shall comply with the procedures that govern the submission and approval of a plan of conversion of the jurisdiction that governs the business entity. (3) A plan of conversion shall set forth all of the following:(a) The name, form of business entity, and the identity of the jurisdiction governing the business entity that is to be converted.(b) The name, form of business entity, and the identity of the jurisdiction that will govern the new business entity.(c) The terms and conditions of the conversion.(d) The manner and basis of converting the shares or other ownership interests of the business entity that is to be converted into the shares or other ownership interests of the new form of business entity.(e) The effective date and time of the conversion, if the conversion is to be effective other than at the close of business on the date of filing the certificate of conversion, as provided under s. 181.0123.(f) A copy of the articles of incorporation, articles of organization, certificate of limited partnership, or other similar governing document of the business entity after conversion.(g) Other provisions relating to the conversion, as determined by the business entity. (4) When a conversion is effective, all of the following shall occur:(a)1. Except with respect to taxation laws of each jurisdiction that are applicable upon the conversion of the business entity, the business entity that was converted is no longer subject to the applicable law of the jurisdiction that governed the organization of the prior form of business entity and is subject to the applicable law of the jurisdiction that governs the new form of business entity.2. If the conversion is from or to a business entity under the laws applicable to which one or more of the owners thereof is liable for the debts and obligations of such business entity, such owner or owners shall continue to be or become so liable for debts and obligations of such business entity, but only for such debts and obligations accrued during the period or periods in which such laws are applicable to such owner or owners. This subdivision does not affect liability under any taxation laws.(b) The business entity continues to have all liabilities of the business entity that was converted.(c) The business entity continues to be vested with title to all property owned by the business entity that was converted without reversion or impairment.(d) The articles of incorporation, articles of organization, certificate of limited partnership, or other similar governing document, whichever is applicable, of the business entity are as provided in the plan of conversion.(e) All other provisions of the plan of conversion apply. (5) After a plan of conversion is submitted and approved, the business entity that is to be converted shall deliver to the department for filing a certificate of conversion that includes all of the following:(a) The plan of conversion.(b) A statement that the plan of conversion was approved in accordance with the applicable law of the jurisdiction that governs the organization of the business entity.(c) The registered agent and registered office, the record agent and record office, or other similar agent and office of the business entity before and after conversion. (6) Any civil, criminal, administrative, or investigatory proceeding that is pending by or against a business entity that is converted may be continued by or against the business entity after the effective date of conversion.History: 2001 a. 44; 2005 a. 476; 2015 a. 295.Next Economy Legislation: Allowing Complex Business Reorganizations. Boucher, Sosnowski, & Nichols. Wis. Law. Aug. 2002.
NOTES: Wis. Stat. Ann. § 181.1161