N.Y. Not-for-Profit Corporation Law § 102: Definitions

§ 102. Definitions.

(a) As used in this chapter, unless the context otherwise requires,

the term:

(1) "Bonds" includes secured and unsecured bonds, debentures, and

notes.

(2) "By-laws" means the code or codes of rules adopted for the

regulation or management of the affairs of the corporation irrespective

of the name or names by which such rules are designated.

(3) "Certificate of incorporation" includes (A) the original

certificate of incorporation or any other instrument filed or issued

under any statute to form a domestic or foreign corporation, as amended,

supplemented or restated by certificates of amendment, merger or

consolidation or other certificates or instruments filed or issued under

any statute; or (B) a special act or charter creating a domestic or

foreign corporation, as amended, supplemented or restated.

(3-a) "Charitable corporation" means any corporation formed, or for

the purposes of this chapter, deemed to be formed, for charitable

purposes.

(3-b) "Charitable purposes" of a corporation means one or more of the

following purposes: charitable, educational, religious, scientific,

literary, cultural or for the prevention of cruelty to children or

animals.

(4) "Conducting of activities" of a corporation means the operations

for the conduct of which such corporation is formed and may constitute

"doing of business" or "transaction of business" as those terms are used

in the statutes of this state.

(5) "Corporation" or "domestic corporation" means a corporation (1)

formed under this chapter, or existing on its effective date and

theretofore formed under any other general statute or by any special act

of this state, exclusively for a purpose or purposes, not for pecuniary

profit or financial gain, for which a corporation may be formed under

this chapter, and (2) no part of the assets, income or profit of which

is distributable to, or enures to the benefit of, its members, directors

or officers except to the extent permitted under this statute.

(6) "Director" means any member of the governing board of a

corporation, whether designated as director, trustee, manager, governor,

or by any other title. The term "board" means "board of directors" or

any other body constituting a "governing board" as defined in this

section.

(6-a) "Entire board" means the total number of directors entitled to

vote which the corporation would have if there were no vacancies. If the

by-laws of the corporation provide that the board shall consist of a

fixed number of directors, then the "entire board" shall consist of that

number of directors. If the by-laws of any corporation provide that the

board may consist of a range between a minimum and maximum number of

directors, and the number within that range has not been fixed in

accordance with paragraph (a) of section seven hundred two of this

chapter, then the "entire board" shall consist of the number of

directors within such range that were elected or appointed as of the

most recently held election of directors, as well as any directors whose

terms have not yet expired.

(7) "Foreign corporation" means a corporation formed under laws other

than the statutes of this state, which, if formed under the statutes of

this state, would be within the term "corporation or domestic

corporation" as herein defined. "Authorized", when used with respect to

a foreign corporation, means having authority under Article 13 (Foreign

Corporations) to conduct activities of the corporation in this state.

(7-a) "Infant" or "minor" means any person who has not attained the

age of eighteen years.

(8) "Insolvent" means being unable to pay debts as they become due in

the usual course of the debtor's business.

(9) "Member" means one having membership rights in a corporation in

accordance with the provisions of its certificate of incorporation or

by-laws.

(9-a) "Non-charitable corporation" means any corporation formed under

this chapter, other than a charitable corporation, including but not

limited to one formed for any one or more of the following non-pecuniary

purposes: civic, patriotic, political, social, fraternal, athletic,

agricultural, horticultural, or animal husbandry, or for the purpose of

operating a professional, commercial, industrial, trade or service

association.

(10) "Not-for-profit corporation" means a corporation as defined in

subparagraph (5).

(11) "Office of a corporation" means the office the location of which

is stated in the certificate of incorporation of a domestic corporation,

or in the application for authority of a foreign corporation or an

amendment thereof. Such office need not be a place where activities are

conducted by such corporation.

(12) "Process" means judicial process and all orders, demands, notices

or other papers required or permitted by law to be personally served on

a domestic or foreign corporation, for the purpose of acquiring

jurisdiction of such corporation in any action or proceeding, civil or

criminal, whether judicial, administrative, arbitrative or otherwise, in

this state or in the federal courts sitting in or for this state.

(15) "Governing board" means the body responsible for the management

of a corporation or of an institutional fund.

(16) "Historic dollar value" means the aggregate fair value in dollars

of (i) an endowment fund at the time it became an endowment fund, (ii)

each subsequent donation to the fund at the time it is made, and (iii)

each accumulation made pursuant to a direction in the applicable gift

instrument at the time the accumulation is added to the fund. The

determination of historic dollar value made in good faith by the

corporation is conclusive.

(18) "Authorized person" means a person, whether or not a member,

officer, or director, who is authorized to act on behalf of a

corporation or foreign corporation.

(19) An "affiliate" of a corporation means any entity controlled by,

or in control of, such corporation.

(20) "Independent auditor" means any certified public accountant

performing the audit of the financial statements of a corporation

required by subdivision one of section one hundred seventy-two-b of the

executive law.

(21) "Independent director" means a director who: (i) is not, and has

not been within the last three years, an employee or a key person of the

corporation or an affiliate of the corporation, and does not have a

relative who is, or has been within the last three years, a key person

of the corporation or an affiliate of the corporation; (ii) has not

received, and does not have a relative who has received, in any of the

last three fiscal years, more than ten thousand dollars in direct

compensation from the corporation or an affiliate of the corporation;

(iii) is not a current employee of or does not have a substantial

financial interest in, and does not have a relative who is a current

officer of or has a substantial financial interest in, any entity that

has provided payments, property or services to, or received payments,

property or services from, the corporation or an affiliate of the

corporation if the amount paid by the corporation to the entity or

received by the corporation from the entity for such property or

services, in any of the last three fiscal years, exceeded the lesser of

ten thousand dollars or two percent of such entity's consolidated gross

revenues if the entity's consolidated gross revenue was less than five

hundred thousand dollars; twenty-five thousand dollars if the entity's

consolidated gross revenue was five hundred thousand dollars or more but

less than ten million dollars; one hundred thousand dollars if the

entity's consolidated gross revenue was ten million dollars or more; or

(iv) is not and does not have a relative who is a current owner, whether

wholly or partially, director, officer or employee of the corporation's

outside auditor or who has worked on the corporation's audit at any time

during the past three years. For purposes of this subparagraph, the

terms: "compensation" does not include reimbursement for expenses

reasonably incurred as a director or reasonable compensation for service

as a director as permitted by paragraph (a) of section 202 (General and

special powers) of this chapter; and "payment" does not include

charitable contributions, dues or fees paid to the corporation for

services which the corporation performs as part of its nonprofit

purposes, or payments made by the corporation at fixed or non-negotiable

rates or amounts for services received, provided that such services by

and to the corporation are available to individual members of the public

on the same terms, and such services received by the corporation are not

available from another source.

(22) "Relative" of an individual means (i) his or her spouse or

domestic partner as defined in section twenty-nine hundred ninety-four-a

of the public health law; (ii) his or her ancestors, brothers and

sisters (whether whole or half blood), children (whether natural or

adopted), grandchildren, great-grandchildren; or (iii) the spouse or

domestic partner of his or her brothers, sisters, children,

grandchildren, and great-grandchildren.

(23) "Related party" means (i) any director, officer or key person of

the corporation or any affiliate of the corporation; (ii) any relative

of any individual described in clause (i) of this subparagraph; or (iii)

any entity in which any individual described in clauses (i) and (ii) of

this subparagraph has a thirty-five percent or greater ownership or

beneficial interest or, in the case of a partnership or professional

corporation, a direct or indirect ownership interest in excess of five

percent.

(24) "Related party transaction" means any transaction, agreement or

any other arrangement in which a related party has a financial interest

and in which the corporation or any affiliate of the corporation is a

participant, except that a transaction shall not be a related party

transaction if: (i) the transaction or the related party's financial

interest in the transaction is de minimis, (ii) the transaction would

not customarily be reviewed by the board or boards of similar

organizations in the ordinary course of business and is available to

others on the same or similar terms, or (iii) the transaction

constitutes a benefit provided to a related party solely as a member of

a class of the beneficiaries that the corporation intends to benefit as

part of the accomplishment of its mission which benefit is available to

all similarly situated members of the same class on the same terms.

(25) "Key person" means any person, other than a director or officer,

whether or not an employee of the corporation, who (i) has

responsibilities, or exercises powers or influence over the corporation

as a whole similar to the responsibilities, powers, or influence of

directors and officers; (ii) manages the corporation, or a segment of

the corporation that represents a substantial portion of the activities,

assets, income or expenses of the corporation; or (iii) alone or with

others controls or determines a substantial portion of the corporation's

capital expenditures or operating budget.