§ 1412 — University faculty practice corporations

§ 1412. University faculty practice corporations.\n (a) Organization. Notwithstanding any other provision of law, one or\nmore individuals who are duly authorized by law to render the same\nprofessional service, which shall be the practice of medicine, the\npractice of dentistry, the practice of chiropractics, the practice of\nphysical therapy or the practice of optometry, and who are members of\nthe faculty of the same accredited medical school, dental school,\nchiropractic college, college or university with an accredited doctor of\nphysical therapy program or optometry college, as applicable, in the\nstate of New York may organize, or cause to be organized, a university\nfaculty practice corporation under this article (1) for the purpose of\nsupporting the educational mission of such school by providing clinical\ninstruction and supervision of students of such school, interns and\nresidents and, incident thereto, rendering professional services and (2)\nwhich shall be operated in compliance with (A) section 501(c)(3) of the\nUnited States internal revenue code and (B) the faculty practice plan\nwith which members of the faculty of such school are required to comply,\nas amended from time to time.\n (b) Definition. "University faculty practice corporation" means a\ncorporation organized or reincorporated under this section.\n (c) Certificate of incorporation. The certificate of incorporation of\na university faculty practice corporation shall meet the requirements of\nthis chapter and shall have attached thereto a certificate or\ncertificates issued by the licensing authority certifying that each of\nthe proposed members, if any, directors and officers is authorized by\nlaw to practice the profession which the corporation is being organized\nto practice. The certificate shall also state (1) the name of the\nmedical school, dental school, chiropractic college, college or\nuniversity with an accredited doctor of physical therapy program or\noptometry college, as applicable, in the state of New York of which the\nproposed members, if any, directors and officers are faculty and (2)\nthat such corporation shall operate in compliance with (A) section\n501(c)(3) of the United States internal revenue code and (B) the faculty\npractice plan with which members of the faculty of such school are\nrequired to comply, as amended from time to time.\n (d) Type. A university faculty practice corporation is a charitable\ncorporation under this chapter.\n (e) Applicability of laws; members, directors and officers. This\nchapter shall be applicable to a university faculty practice corporation\nexcept to the extent that the provisions thereof conflict with this\nsection. A university faculty practice corporation may consolidate or\nmerge only with another university faculty practice corporation. The\nfollowing provisions of article fifteen of the business corporation law\nshall be applicable to a university faculty practice corporation except\nthat each reference in such provisions to a "shareholder" shall be\ndeemed to be a reference to a "member" and each reference in such\nprovisions to "shareholders" shall be deemed a reference to "members":\nparagraphs (a), (b), (c) and (e) of section fifteen hundred one;\nparagraphs (b), (c) and (d) of section fifteen hundred three; paragraphs\n(a), (c) and (g) of section fifteen hundred four; section fifteen\nhundred five; section fifteen hundred nine except to the extent such\nsection refers to section fifteen hundred ten; paragraph (a) of section\nfifteen hundred twelve; section fifteen hundred fourteen; and section\nfifteen hundred fifteen. No individual may be a member, director or\nofficer of a university faculty practice corporation unless such\nindividual is authorized by law to practice in this state the profession\nwhich such corporation is authorized to practice and is a member of the\nfaculty of the medical school, dental school, chiropractic college,\ncollege or university with an accredited doctor of physical therapy\nprogram or optometry college which such corporation is organized to\nsupport.\n (f) Corporations heretofore incorporated. Any corporation heretofore\nincorporated under article fifteen of the business corporation law and\noperated in compliance with the requirements of section 501(c)(3) of the\nUnited States internal revenue code may amend its certificate of\nincorporation and be reincorporated as a university faculty practice\ncorporation organized under this section by making and filing in the\noffice of the secretary of state a certificate entitled "Certificate of\nReincorporation of...(name of incorporation) under section 1412 of the\nNot-for-Profit Corporation Law." (1) Such reincorporation certificate\nshall contain the provisions required, and any other provisions\npermitted, by section 402 of this chapter and shall also set forth (A) a\nstatement that such corporation is filing such reincorporation\ncertificate under this section, (B) if the name of such corporation has\nbeen changed, the name under which such corporation was originally\nincorporated, (C) the date of incorporation of such corporation, (D) the\nnames and post-office addresses of the holders of record of all of the\noutstanding shares of such corporation entitled to vote, (E) a statement\nthat such corporation has elected to become and be a university faculty\npractice corporation organized and operated under by virtue of this\nsection and (F) the statements required by paragraph (c) of this\nsection. (2) Such reincorporation certificate shall be either (A)\nsubscribed in person or by proxy by all of the holders of record of all\nof the outstanding shares of such corporation entitled to vote and shall\nhave annexed an affidavit of the secretary or an assistant secretary\nthat the persons who have executed the certificate, in person or by\nproxy, constitute all of the holders of record of all of the outstanding\nshares of the corporation entitled to vote or (B) subscribed by the\npresident or a vice president and the secretary or an assistant\nsecretary and shall have annexed an affidavit of such officers stating\nthat they have been authorized to execute and file such reincorporation\ncertificate by the votes, cast in person or by proxy, of all of the\nholders of record of all of the outstanding shares of such corporation\nentitled to vote at the meeting at which such votes were cast, and that\nsuch votes were cast at a meeting of shareholders held on a date\nspecified, upon notice pursuant to section six hundred five of the\nbusiness corporation law. (3) A reincorporation pursuant to this\nparagraph shall not effect a dissolution of such corporation, but shall\nbe deemed a continuation of its corporate existence, without affecting\nits then-existing property rights or liabilities, or the liabilities of\nits shareholders, directors or officers as such, but thereafter it shall\nhave only such rights, powers and privileges, and it and such\nshareholders, directors and officers shall be subject only to such other\nduties and liabilities, as a university faculty practice corporation and\nmembers, directors and officers thereof. (4) Upon the filing of a\nreincorporation certificate in the office of the secretary of state, (A)\nany issued and outstanding shares of such corporation shall be purchased\nby such corporation at a purchase price equal to the price for which\nsuch shares were originally issued, or such other price as such\ncorporation shall agree to, such price to be paid out of the surplus of\nthe corporation, whereupon such shares shall be deemed cancelled as of\nthe date of such filing and (B) such reincorporation certificate shall\nbe deemed to replace the certificate of incorporation of such\ncorporation. The department of state shall not file such certificate of\nreincorporation unless the consent of the commissioner of taxation and\nfinance is attached thereto. Such certificate of consent shall only be\ngiven if the commissioner of taxation and finance ascertains that all\ntaxes imposed under article nine-A of the tax law, as well as penalties\nand interest charges related thereto, accrued against the corporation\nhave been paid.\n (g) Effect of section. University faculty practice corporations\nincorporated or reincorporated under this section shall be organized and\noperated exclusively for the purposes set forth in paragraph (a) of this\nsection and shall be subject to the restrictions and limitations imposed\nby or pursuant to paragraphs (a) and (e) of this section.\nNotwithstanding anything to the contrary in article twenty-eight of the\npublic health law or the regulations adopted pursuant thereto, no\ncorporation organized under this section shall be deemed to be\nestablishing or operating a hospital, diagnostic center and/or treatment\ncenter requiring establishment or construction approval solely by reason\nof being organized as a not-for-profit corporation. Insofar as the\nprovisions of this section are inconsistent with the provisions of any\nother law, general or special, the provisions of this section shall be\ncontrolling as to the corporations incorporated or reincorporated\nhereunder.\n