2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › NONPROFIT CORPORATIONS (§§ 48-51-101 — 48-69-123) › Chapter 51 - GENERAL PROVISIONS (§§ 48-51-101 — 48-51-701) › Part 2 - DEFINITIONS (§§ 48-51-201 — 48-51-202) › Section 48-51-201 - Definitions for chapters 51 through 68

As used in chapters 51-68 of this title, unless the context otherwise requires:
(1)
"Approved by (or approval by) the members" means approved or ratified by affirmative votes that exceed the number of negative votes represented and voting at a duly held meeting at which a quorum is present or by a written ballot or written consent in conformity with chapters 51-68 of this title or by the affirmative vote, written ballot or written consent of such greater proportions, including the votes of all the members of any class, unit or grouping as may be provided in the charter, bylaws or chapters 51-68 of this title for any specified member action;
(2)
"Board" or "board of directors" means the governing board of a corporation, whether denominated the board of directors or otherwise, except that no person or group of persons is the board of directors because of powers delegated to that person or group pursuant to §
48-58-101
;
(3)
"Bylaws" means the code or codes of rules (other than the charter) adopted pursuant to chapters 51-68 of this title for the regulation or management of the affairs of the corporation irrespective of the name or names by which such rules are designated;
(4)
"Charitable purpose" means a purpose that:
(A)
Would make a corporation operated exclusively for that purpose eligible to be exempt from taxation under Section 501(c)(3) of the Internal Revenue Code;
(B)
Is for the public benefit; or
(C)
Is considered charitable under law in this state other than in chapters 51-68 of this title;
(5)
"Charter" includes amended and restated charters and articles of merger;
(6)
"Class" refers to a group of memberships which have the same rights with respect to voting, dissolution, redemption and transfer. For the purpose of this section, rights shall be considered the same if they are determined by a formula applied uniformly;
(7)
"Confirmation of good standing" means confirmation by the commissioner of revenue issued through electronic communication to the secretary of state or a certificate of tax clearance that at the time such confirmation is issued a domestic or foreign corporation is current on all taxes and penalties to the satisfaction of the commissioner;
(8)
"Conspicuous" means so written that a reasonable person against whom the writing is to operate should have noticed it. For example, printing in italics or boldface or contrasting color, or typing in capitals or underlined is "conspicuous";
(9)
"Corporation" or "domestic corporation" means a public benefit or mutual benefit corporation which is not a foreign corporation, incorporated under or subject to chapters 51-68 of this title;
(10)
"Delegates" means those persons elected or appointed to vote in a representative assembly for the election of a director or directors or on other matters;
(11)
"Deliver" or "delivery" means any method of delivery used in conventional commercial practice, including delivery by hand, mail, commercial delivery, or electronic transmission, except that delivery to the attorney general and reporter means actual receipt by the attorney general;
(12)
"Directors" means natural persons, designated in the charter or bylaws or elected or appointed by the incorporators, and their successors and natural persons elected or appointed to act as members of the board, irrespective of the names or titles by which such persons are described;
(13)
"Distribution" means the direct or indirect transfer of assets or any part of the income or profit of a corporation, to its members, directors or officers. "Distribution" does not include:
(A)
The payment of compensation in a reasonable amount and the reimbursement of reasonable expenses to its members, directors, or officers for services rendered;
(B)
Conferring benefits on its members in conformity with its purposes;
(C)
Repayment of debt obligations in the normal and ordinary course of conducting activities;
(D)
The incurrence of indebtedness, whether directly or indirectly, including through a guaranty, for or on behalf of a member, director or officer;
(E)
A sale on credit in the ordinary course of business or a life insurance policy loan; or
(F)
Any item in §
48-58-303(c)
;
(14)
"Document" means:
(A)
Any tangible medium on which information is inscribed, and includes any writing or written instrument; or
(B)
An electronic record;
(15)
"Effective date of notice," has the same meaning as provided in §
48-51-202
;
(16)
"Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities;
(17)
"Electronic record" means information that is stored in an electronic or other medium and is retrievable in paper form through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with §
48-51-202
;
(18)
"Electronic transmission" or "electronically transmitted" means any form or process of communication not directly involving physical transfer of paper or another tangible medium that is:
(A)
Suitable for the retention, retrieval, and reproduction of information by the recipient; and
(B)
Is retrievable in paper form by the recipient through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with §
48-51-202
(
l
);
(19)
"Emergency" exists when a quorum of the corporation's directors cannot readily be assembled because of some catastrophic event;
(20)
"Employee" includes an officer but not a director. A director may accept duties that make the director also an employee;
(21)
"Entity" includes domestic and foreign business corporation; domestic and foreign nonprofit corporation; estate; trust; business trust, partnership, and two (2) or more persons having a joint or common economic interest; domestic and foreign unincorporated entity; and this state, United States and foreign government;
(22)
"Foreign corporation" means a nonprofit corporation incorporated under a law other than the law of this state, which would be a nonprofit corporation if formed under the laws of this state;
(23)
"Governmental subdivision" includes authority, county, district and municipality;
()
"Healthcare sharing ministry" means a nonprofit corporation that:
(A)
Is tax-exempt under the Internal Revenue Code of 1986 (26 U.S.C);
(B)
Limits its participants to those members who share a common set of ethical or religious beliefs;
(C)
Acts as a facilitator among participants who have financial or medical needs to assist those with financial or medical needs in accordance with criteria established by the healthcare sharing ministry;
(D)
Provides for the financial or medical needs of a participant through contributions from other participants;
(E)
Provides amounts that participants may contribute with no assumption of risk or promise to pay among the participants, and no assumption of risk or promise to pay by the healthcare sharing ministry to the participants;
(F)
Provides monthly to the participants the total dollar amount of qualified needs actually shared during the previous month in accordance with criteria established by the healthcare shahng ministry;
(G)
Conducts an annual audit that is performed by an independent certified public accounting firm in accordance with generally accepted accounting principles and that is made available to the public by providing a copy upon request or by posting on the organization's website; and
(H)
Provides a written disclaimer on or accompanying all applications and guideline materials distributed by or on behalf of the organization that is substantially similar to the following:
Notice: The organization facilitating the sharing of medical expenses is not an insurance company, and neither its guidelines nor plan of operation is an insurance policy. Whether anyone chooses to assist you with your medical bills will be totally voluntary because no other participant will be compelled by law to contribute toward your medical bills. As such, participation in the organization or a subscription to any of its documents should never be considered to be insurance. Regardless of whether you receive any payments for medical expenses or whether this organization continues to operate, you are always personally responsible for the payment of your own medical bills.
(24)
"Includes" denotes a partial definition;
(25)
"Individual" includes the estate of an incompetent or deceased individual;
(26)
"Interest" means either or both of the following rights under the organic law of an unincorporated entity:
(A)
The right to receive distributions from the entity either in the ordinary course or upon liquidation; or
(B)
The right to receive notice or vote on issues involving its internal affairs, other than as an agent, assignee, proxy, or person responsible for managing its business and affairs;
(27)
"Interest holder" means a person who holds of record an interest;
(28)
"Means" denotes an exhaustive definition;
(29)
(A)
"Member" means, without regard to what a person is called in the charter or bylaws, any person who on more than one (1) occasion, pursuant to a provision of a corporation's charter or bylaws, has the right to vote for the election or appointment of a director or directors;
(B)
A person is not a member by virtue of any of the following:
(i)
Any rights such person has as a delegate;
(ii)
Any rights such person has to designate a director or directors;
(iii)
Any rights such person has to appoint a director or directors of a public benefit corporation; or
(iv)
Any rights such person has as a director;
(30)
"Membership" means the rights and obligations a member has pursuant to a corporation's charter, bylaws and chapters 51-68 of this title;
(31)
"Month" means the time from any day of any month to the corresponding day of the succeeding month, if any, and if none, the last day of the succeeding month;
(32)
"Mutual benefit corporation" means a domestic corporation which becomes by operation of law a mutual benefit corporation pursuant to §
48-68-104
or is formed as a mutual benefit corporation pursuant to chapter 52 of this title;
(33)
"Notice," has the same meaning as provided in §
48-51-202
;
(34)
"Organic document" means a public organic document or a private organic document;
(35)
"Organic law" means the statute governing the internal affairs of a domestic or foreign business or nonprofit corporation or unincorporated entity;
(36)
"Person" includes individual and entity;
(37)
"Principal office" means the office (in or out of this state) so designated in the charter or certificate of authority where the principal executive offices of a domestic or foreign corporation are located;
(38)
"Private organic document" means any document, other than the public organic document, if any, that determines the internal governance of an unincorporated entity; where a private organic document has been amended or restated, "private organic document" means the private organic document as last amended or restated;
(39)
"Proceeding" includes civil suit and criminal, administrative, and investigatory action;
(40)
"Public benefit corporation" means a domestic corporation which becomes by operation of law a public benefit corporation pursuant to §
48-68-104
or is formed as a public benefit corporation pursuant to chapter 52 of this title;
(41)
"Public organic document" means the document, if any, that is filed of public record to create an unincorporated entity; where a public organic document has been amended or restated, "public organic document" means the public organic document as last amended or restated;
(42)
"Record date" means the date established under chapter 56 or 57 of this title on which a corporation determines the identity of its members for purposes of chapters 51-68 of this title;
(43)
"Religious corporation" means a public benefit or mutual benefit corporation organized and operating primarily or exclusively for religious purposes;
(44)
"Share" means the unit into which the proprietary interests in a corporation are divided;
(45)
"Sign" or "signature" means, with present intent to authenticate or adopt a document:
(A)
To execute or adopt a tangible symbol to a document, and includes any manual, facsimile, or conformed signature; or
(B)
To attach to or logically associate with an electronic transmission an electronic sound, symbol, or process, and includes an electronic signature in an electronic transmission;
(46)
"State," when referring to a part of the United States, includes a state and commonwealth (and their agencies and governmental subdivisions) and a territory and insular possession (and their agencies and governmental subdivisions) of the United States;
(47)
"Tax clearance for termination or withdrawal" means confirmation by the commissioner of revenue issued through electronic communication to the secretary of state or a certificate of tax clearance that a domestic or foreign corporation has filed all applicable reports, including, but not limited to, a final report, and has paid all fees, penalties and taxes as required by the revenue laws of this state;
(48)
"Unincorporated entity" means an organization or artificial legal person that either has a separate legal existence or has the power to acquire an estate in real property in its own name and that is not any of the following: a domestic or foreign business or nonprofit corporation, an estate, a trust, a state, the United States, or a foreign government; "unincorporated entity" includes a general partnership, limited liability company, limited partnership, business trust, joint stock association, and unincorporated nonprofit association;
(49)
"United States" includes district, authority, bureau, commission, department and any other agency of the United States; and
(50)
"Voting power" means the total number of votes entitled to be cast for the election of directors at the time the determination of voting power is made, excluding a vote which is contingent upon the happening of a condition or event that has not occurred at the time. When a class is entitled to vote as a class for directors, the determination of voting power of the class shall be based on the percentage of the number of directors the class is entitled to elect out of the total number of authorized directors.
Amended by 2024 Tenn. Acts, ch. 526,s 2, eff. 3/7/2024.
Amended by 2015 Tenn. Acts, ch. 60, s 6, eff. 4/6/2015.
Amended by 2014 Tenn. Acts, ch. 899, Secs.s 2, s 3, s 4, s 5, s 6, s 7 eff. 1/1/2015.
Amended by 2014 Tenn. Acts, ch. 899, s 1, eff. 1/1/2015.
Acts 1987, ch. 242, § 1.20; 2010 , ch. 741, § 13.