Virginia Code 32.1-374: Obligations of nonprofit entity
Prior to disposition of assets, any nonprofit entity shall provide to the Attorney General written notice, on a form provided by the Attorney General, of its intent to dispose of such assets, including the terms of the proposal. The notice shall be given at least 60 days in advance of the effective date of such proposed transaction in order that the Attorney General may exercise his common law and statutory authority over the activities of these organizations. The Attorney General may employ expert assistance in reviewing any proposed transaction, and such reasonable expenses incurred by the Attorney General shall be paid by a party to the proposed transaction.
Terms Used In Virginia Code 32.1-374
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Common law: The legal system that originated in England and is now in use in the United States. It is based on judicial decisions rather than legislative action.
- 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.
- Disposition of assets: means any action undertaken by a nonprofit entity to dispose of control of all or substantially all of its assets pursuant to an agreement of sale, transfer, lease, exchange, option, joint venture, or partnership, or to convert to a for-profit entity or to otherwise restructure the nonprofit entity or its assets, resulting in a change in control or governance of the entity or assets. See Virginia Code 32.1-373
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Nonprofit entity: means (i) a foreign or domestic nonstock corporation licensed and subject to regulation under Virginia Code 32.1-373
- State: when applied to a part of the United States, includes any of the 50 states, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Northern Mariana Islands, and the United States Virgin Islands. See Virginia Code 1-245
Within 10 days of receipt of the notice from the entity, the Attorney General shall cause a public notice of the transaction to be published in a newspaper in which legal notices may be published in that jurisdiction.
No later than 40 days prior to any disposition of assets, the nonprofit entity shall convene a public meeting to set forth its expectations concerning how the health care needs of the community will be served following the proposed disposition of assets and to receive comments and respond to questions on the potential impact of the proposed disposition of assets on the community served by the nonprofit entity. Notice of the time and place of such meeting shall be published at least 10 days prior to the meeting in a newspaper in which legal notices may be published in that jurisdiction.
Notice to the Attorney General pursuant to this section shall be given for State Corporation Commission approval sought pursuant to Article 11 (§ 13.1-893.1) of Chapter 10 of Title 13.1 and §§ 38.2-203 and 38.2-1322 through 38.2-1328 and subdivision A 1 of § 38.2-4316. Such notice need not be given where the State Corporation Commission determines, in its sole discretion, that there is a reasonable expectation that the foreign or domestic nonstock corporation licensed and subject to regulation under Chapter 42 of Title 38.2 or health maintenance organization referenced in this chapter will not be able to meet its obligations to subscribers or enrollees.
The provisions of this section shall not apply to any disposition of assets subject to the provisions of § 38.2-4214.1 or any of the provisions of Chapter 15 of Title 38.2.
1997, c. 615, § 55-532; 2002, c. 516; 2007, c. 925; 2008, c. 253; 2018, c. 706; 2019, c. 712.