2023 New York Laws › NPC - Not-For-Profit Corporation › Article 1 - Short Title; Definitions; Application; Certificates; Miscellaneous › 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.