a. The sale, transfer, lease, exchange, optioning, conveyance, affiliation, merger, joint venture, or other disposition of
a material amount of the assets or operations of a not-for-profit healthcare entity, made other than in the normal course
of business, to an entity or person other than a charity or not-for-profit entity;
b. The transfer of control or governance of a material amount of the assets or operations of a not-for-profit healthcare entity
to an entity or person other than a charity or not-for-profit entity;
c. A substantial change or amendment to a certificate of incorporation which materially affects an entity's charitable or
public benefit intent, or a disposition of reserves or control of a not-for-profit healthcare entity or of a charitable entity
or of an entity holding assets for the public benefit;
d. A change in the composition of the Board of Directors such that, upon the effective date of such change, a majority of
directors of the not-for-profit healthcare entity are affiliated with (or have been elected by directors a majority of whom
were or are affiliated with) any single entity or person other than a charity or not-for-profit entity. For purposes of this
subsection, a director shall be deemed to be affiliated with such entity or person if such director:
1. Receives or has received, directly or indirectly, compensation, including income, in any form from such person or entity
(or parent, subsidiary or affiliate of such entity);
2. Serves or has served as a director, officer, employee, partner, member or agent of such entity (or of a parent, subsidiary
or affiliate of such entity);
3. Is a close family member of such person or is a close family member of any person who serves as an officer or director
of such entity (or parent, subsidiary or affiliate of such entity); or
4. Is, directly or indirectly, controlled by such person or entity.
(2) "Not-for-profit healthcare entity" includes a not-for-profit hospital, including a corporation or a hospital created under
a trust or will, a not for profit healthcare service provider, a not-for-profit nursing home or long term care facility, a
not-for profit healthcare insurer, a mutual corporation holding assets in charitable trust for the public benefit, an entity
maintaining plans to provide healthcare services or indemnity thereof, and an entity, other than a for-profit entity, affiliated
with any of these through ownership, governance, or membership, such as a holding company or subsidiary.
(3) "Not-for-profit healthcare insurer" includes a not-for-profit provider of healthcare insurance, including service associations,
health service corporations, and physician service organizations or their affiliates.
(4) "Person" means an individual, partnership, trust, estate, corporation, association, organization, joint venture, joint
stock company, limited liability company, or other legal or commercial entity.
(5) "Public benefit asset" means, as to a not-for-profit healthcare entity that is seeking to engage in a not-for-profit healthcare
conversion transaction, that part of the fair market value of the converting entity impressed with a public trust for the
public benefit as initially determined by the Attorney General and subject to the approval of the Court of Chancery.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;
§ 2532. Notice to the Attorney General.
A not-for-profit healthcare entity seeking to engage in a not-for-profit healthcare conversion transaction is required to
provide written notice of its intent to enter into the transaction to the Attorney General of the State within 180 days prior
to the closing date of the proposed transaction.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;
§ 2533. Establishment of a foundation.
(a) For proceeds or reserves of not-for-profit healthcare conversion transactions that constitute public benefit assets, there
shall be created a new tax-exempt public benefit or charitable organization or foundation pursuant to 26 U.S.C.§ 501(c)(3)
or § 501(c)(4) of the Federal Internal Revenue Code into which the proceeds or reserves shall be ultimately deposited. Whether
or not the public benefit or charitable organization is classified as a private foundation under § 509 of the Internal Revenue
Code [26 U.S.C. § 509], it shall be subject to the restrictions and limitations that apply to private foundations found in
§ 4941 through 4945 of the Internal Revenue Code [26 U.S.C. §§ 4941 through 4945].
(b) The mission of the public benefit or charitable organization or foundation receiving the public benefit assets shall be
serving the State's unmet health needs, particularly with regard to medically uninsured and underserved populations.
(c) The board of directors of the foundation shall consist of 9 to 15 members who shall be broadly representative of the community's
diversity and shall include persons with knowledge, expertise and skills in investment and asset management, healthcare finance,
not-for-profit administration, delivery of healthcare services, and of health care consumer issues. Each member of the board
of directors shall be appointed by the Governor, by and with the consent of the Senate, from a list of qualified persons who
have been nominated by the Community Advisory Committee established in subsection (d) of this section, below. The directors
shall elect a chairperson. The directors shall have the authority to adopt bylaws for the foundation in consultation with
the Community Advisory Committee. After the directors have finalized the formation of the foundation and the adoption of bylaws,
the State shall transfer the public benefit assets to the foundation.
(d) A Community Advisory Committee shall be formed to nominate candidates for the foundation's board of directors. The initial
Community Advisory Committee shall be comprised of 9 members, 1 selected by each of the following organizations: the Delaware
State Chamber of Commerce, the Medical Society of Delaware, the Delaware Community Foundation, the Delaware Nurses' Association,
the Delaware AFL-CIO, the Delaware Healthcare Association, the United Way of Delaware, the Delaware State Senate, whose member
shall be selected by the President Pro Tem of the Senate, and the Delaware House of Representatives, whose member shall be
selected by the Speaker of the House. The Advisory Committee shall elect a chairperson. Members of the Community Advisory
Committee shall be appointed within 60 days after the State receives public benefits assets from any not-for-profit health
care conversion transaction. The foundation may expand the Community Advisory Committee and provide for additional appointments
through its bylaws. The Community Advisory Committee's criteria for nominating board members shall ensure an open recruitment
process for the directors. The Community Advisory committee shall nominate at least 30 residents of Delaware for the initial
board of directors. At no time shall the Community Advisory Committee nominate 1 of its own members for appointment to the
board of directors of the foundation. In addition to nominating persons for consideration of appointment, the Community Advisory
Committee shall also work with the foundation's board of directors to develop and improve the foundation's mission, certificate
of incorporation and by-laws, and shall provide ongoing guidance to the board concerning community needs and other issues
relating to the activities of the foundation.
(e) The State Treasurer shall open and maintain an escrow account for the benefit of the foundation for the receipt of any
public benefit assets. During the interim time period from when the State receives public benefit assets until they are transferred
to the foundation, the State Treasurer shall invest any funds that are part of the public benefit amount in a manner that
will protect the principal balance of the public benefit assets.
(f) The certificate of incorporation of the foundation shall provide that the directors shall be appointed to the board for
a term of 3 years except as provided herein. The term for each board position shall be staggered by thirds so that the first
term for a board position may be 1, 2 or 3 years and shall be determined by lot. No individual may serve more than 2 terms
consecutively, except for the initial members whose terms are 1 or 2 years who may serve 3 consecutive terms. Notwithstanding
any other law to the contrary, directors of the foundation shall be prohibited from holding over their term once expired even
if their successors have not been duly elected and qualified. The directors shall receive no compensation for their service
on the board of the foundation other than reimbursement for reasonable expenses related to their service. No elected official
may serve as a director of the foundation.
(g) The not-for-profit public benefit or charitable organization or foundation receiving the public benefit assets, its directors,
officers, and management shall be and remain independent of the for-profit company or mutual corporation and its affiliates.
No person who is an officer, director, or member of management of the not-for-profit corporation submitting the plan for the
proposed healthcare conversion transaction, at the time the plan is submitted, or at the time of the agreement or transaction,
or thereafter, shall be qualified to be an officer, director or member of management of the not-for-profit public benefit
or charitable organization or foundation receiving the charitable assets.
(h) The not-for-profit public benefit or charitable organization or foundation receiving the public benefit assets shall establish
formal mechanisms to avoid conflicts of interest and to prohibit grants benefiting the for-profit corporation, the board of
directors and management of the for-profit corporation.
(i) The foundation shall have the power to enter into any contract, acquire, lease, sell, hold or dispose of any assets in
accordance with the purposes of this subchapter; to employ, retain or enter into contracts with persons in connection with
the management and operation of the foundation; to bring or defend, pay, collect, compromise or arbitrate any legal action
by or against the foundation; to deposit withdraw, invest, pay, retain and distribute the foundation's funds in accordance
with this subchapter; to purchase, hold, sell, lease, exchange, receive or otherwise acquire or dispose of securities in the
name of the foundation; to open, maintain and close bank accounts, and draw checks or other orders for the payment of moneys;
and to authorize any officer, director employee or other agent of the foundation to act for and on behalf of the foundation
in all matters incidental to the forgoing.
(j) The charitable organization or foundation receiving the public benefit assets shall provide the Attorney General, the
Governor, and the General Assembly with an annual report of its charitable activities related to its use of the public benefit
assets received. The annual report shall be a public document.
(k) Nothing in this subchapter shall be construed to limit the common law authority of the Attorney General to protect the
charitable trusts and assets held for the public benefit in this State. Nothing in this subchapter shall be construed as a
replacement for any other civil or criminal actions, which the Attorney General may take either under the common law or statutory
law, seeking injunctive relief, or other available remedies.
(l) Nothing in this subchapter shall be construed to supersede, restrict or otherwise limit the powers, duties, and authority
of the Insurance Commissioner pursuant to Title 18, or any other provisions relating to the regulation of insurers, hospitals,
or other health care corporations.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;
a. The sale, transfer, lease, exchange, optioning, conveyance, affiliation, merger, joint venture, or other disposition of
a material amount of the assets or operations of a not-for-profit healthcare entity, made other than in the normal course
of business, to an entity or person other than a charity or not-for-profit entity;
b. The transfer of control or governance of a material amount of the assets or operations of a not-for-profit healthcare entity
to an entity or person other than a charity or not-for-profit entity;
c. A substantial change or amendment to a certificate of incorporation which materially affects an entity's charitable or
public benefit intent, or a disposition of reserves or control of a not-for-profit healthcare entity or of a charitable entity
or of an entity holding assets for the public benefit;
d. A change in the composition of the Board of Directors such that, upon the effective date of such change, a majority of
directors of the not-for-profit healthcare entity are affiliated with (or have been elected by directors a majority of whom
were or are affiliated with) any single entity or person other than a charity or not-for-profit entity. For purposes of this
subsection, a director shall be deemed to be affiliated with such entity or person if such director:
1. Receives or has received, directly or indirectly, compensation, including income, in any form from such person or entity
(or parent, subsidiary or affiliate of such entity);
2. Serves or has served as a director, officer, employee, partner, member or agent of such entity (or of a parent, subsidiary
or affiliate of such entity);
3. Is a close family member of such person or is a close family member of any person who serves as an officer or director
of such entity (or parent, subsidiary or affiliate of such entity); or
4. Is, directly or indirectly, controlled by such person or entity.
(2) "Not-for-profit healthcare entity" includes a not-for-profit hospital, including a corporation or a hospital created under
a trust or will, a not for profit healthcare service provider, a not-for-profit nursing home or long term care facility, a
not-for profit healthcare insurer, a mutual corporation holding assets in charitable trust for the public benefit, an entity
maintaining plans to provide healthcare services or indemnity thereof, and an entity, other than a for-profit entity, affiliated
with any of these through ownership, governance, or membership, such as a holding company or subsidiary.
(3) "Not-for-profit healthcare insurer" includes a not-for-profit provider of healthcare insurance, including service associations,
health service corporations, and physician service organizations or their affiliates.
(4) "Person" means an individual, partnership, trust, estate, corporation, association, organization, joint venture, joint
stock company, limited liability company, or other legal or commercial entity.
(5) "Public benefit asset" means, as to a not-for-profit healthcare entity that is seeking to engage in a not-for-profit healthcare
conversion transaction, that part of the fair market value of the converting entity impressed with a public trust for the
public benefit as initially determined by the Attorney General and subject to the approval of the Court of Chancery.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;
§ 2532. Notice to the Attorney General.
A not-for-profit healthcare entity seeking to engage in a not-for-profit healthcare conversion transaction is required to
provide written notice of its intent to enter into the transaction to the Attorney General of the State within 180 days prior
to the closing date of the proposed transaction.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;
§ 2533. Establishment of a foundation.
(a) For proceeds or reserves of not-for-profit healthcare conversion transactions that constitute public benefit assets, there
shall be created a new tax-exempt public benefit or charitable organization or foundation pursuant to 26 U.S.C.§ 501(c)(3)
or § 501(c)(4) of the Federal Internal Revenue Code into which the proceeds or reserves shall be ultimately deposited. Whether
or not the public benefit or charitable organization is classified as a private foundation under § 509 of the Internal Revenue
Code [26 U.S.C. § 509], it shall be subject to the restrictions and limitations that apply to private foundations found in
§ 4941 through 4945 of the Internal Revenue Code [26 U.S.C. §§ 4941 through 4945].
(b) The mission of the public benefit or charitable organization or foundation receiving the public benefit assets shall be
serving the State's unmet health needs, particularly with regard to medically uninsured and underserved populations.
(c) The board of directors of the foundation shall consist of 9 to 15 members who shall be broadly representative of the community's
diversity and shall include persons with knowledge, expertise and skills in investment and asset management, healthcare finance,
not-for-profit administration, delivery of healthcare services, and of health care consumer issues. Each member of the board
of directors shall be appointed by the Governor, by and with the consent of the Senate, from a list of qualified persons who
have been nominated by the Community Advisory Committee established in subsection (d) of this section, below. The directors
shall elect a chairperson. The directors shall have the authority to adopt bylaws for the foundation in consultation with
the Community Advisory Committee. After the directors have finalized the formation of the foundation and the adoption of bylaws,
the State shall transfer the public benefit assets to the foundation.
(d) A Community Advisory Committee shall be formed to nominate candidates for the foundation's board of directors. The initial
Community Advisory Committee shall be comprised of 9 members, 1 selected by each of the following organizations: the Delaware
State Chamber of Commerce, the Medical Society of Delaware, the Delaware Community Foundation, the Delaware Nurses' Association,
the Delaware AFL-CIO, the Delaware Healthcare Association, the United Way of Delaware, the Delaware State Senate, whose member
shall be selected by the President Pro Tem of the Senate, and the Delaware House of Representatives, whose member shall be
selected by the Speaker of the House. The Advisory Committee shall elect a chairperson. Members of the Community Advisory
Committee shall be appointed within 60 days after the State receives public benefits assets from any not-for-profit health
care conversion transaction. The foundation may expand the Community Advisory Committee and provide for additional appointments
through its bylaws. The Community Advisory Committee's criteria for nominating board members shall ensure an open recruitment
process for the directors. The Community Advisory committee shall nominate at least 30 residents of Delaware for the initial
board of directors. At no time shall the Community Advisory Committee nominate 1 of its own members for appointment to the
board of directors of the foundation. In addition to nominating persons for consideration of appointment, the Community Advisory
Committee shall also work with the foundation's board of directors to develop and improve the foundation's mission, certificate
of incorporation and by-laws, and shall provide ongoing guidance to the board concerning community needs and other issues
relating to the activities of the foundation.
(e) The State Treasurer shall open and maintain an escrow account for the benefit of the foundation for the receipt of any
public benefit assets. During the interim time period from when the State receives public benefit assets until they are transferred
to the foundation, the State Treasurer shall invest any funds that are part of the public benefit amount in a manner that
will protect the principal balance of the public benefit assets.
(f) The certificate of incorporation of the foundation shall provide that the directors shall be appointed to the board for
a term of 3 years except as provided herein. The term for each board position shall be staggered by thirds so that the first
term for a board position may be 1, 2 or 3 years and shall be determined by lot. No individual may serve more than 2 terms
consecutively, except for the initial members whose terms are 1 or 2 years who may serve 3 consecutive terms. Notwithstanding
any other law to the contrary, directors of the foundation shall be prohibited from holding over their term once expired even
if their successors have not been duly elected and qualified. The directors shall receive no compensation for their service
on the board of the foundation other than reimbursement for reasonable expenses related to their service. No elected official
may serve as a director of the foundation.
(g) The not-for-profit public benefit or charitable organization or foundation receiving the public benefit assets, its directors,
officers, and management shall be and remain independent of the for-profit company or mutual corporation and its affiliates.
No person who is an officer, director, or member of management of the not-for-profit corporation submitting the plan for the
proposed healthcare conversion transaction, at the time the plan is submitted, or at the time of the agreement or transaction,
or thereafter, shall be qualified to be an officer, director or member of management of the not-for-profit public benefit
or charitable organization or foundation receiving the charitable assets.
(h) The not-for-profit public benefit or charitable organization or foundation receiving the public benefit assets shall establish
formal mechanisms to avoid conflicts of interest and to prohibit grants benefiting the for-profit corporation, the board of
directors and management of the for-profit corporation.
(i) The foundation shall have the power to enter into any contract, acquire, lease, sell, hold or dispose of any assets in
accordance with the purposes of this subchapter; to employ, retain or enter into contracts with persons in connection with
the management and operation of the foundation; to bring or defend, pay, collect, compromise or arbitrate any legal action
by or against the foundation; to deposit withdraw, invest, pay, retain and distribute the foundation's funds in accordance
with this subchapter; to purchase, hold, sell, lease, exchange, receive or otherwise acquire or dispose of securities in the
name of the foundation; to open, maintain and close bank accounts, and draw checks or other orders for the payment of moneys;
and to authorize any officer, director employee or other agent of the foundation to act for and on behalf of the foundation
in all matters incidental to the forgoing.
(j) The charitable organization or foundation receiving the public benefit assets shall provide the Attorney General, the
Governor, and the General Assembly with an annual report of its charitable activities related to its use of the public benefit
assets received. The annual report shall be a public document.
(k) Nothing in this subchapter shall be construed to limit the common law authority of the Attorney General to protect the
charitable trusts and assets held for the public benefit in this State. Nothing in this subchapter shall be construed as a
replacement for any other civil or criminal actions, which the Attorney General may take either under the common law or statutory
law, seeking injunctive relief, or other available remedies.
(l) Nothing in this subchapter shall be construed to supersede, restrict or otherwise limit the powers, duties, and authority
of the Insurance Commissioner pursuant to Title 18, or any other provisions relating to the regulation of insurers, hospitals,
or other health care corporations.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;
a. The sale, transfer, lease, exchange, optioning, conveyance, affiliation, merger, joint venture, or other disposition of
a material amount of the assets or operations of a not-for-profit healthcare entity, made other than in the normal course
of business, to an entity or person other than a charity or not-for-profit entity;
b. The transfer of control or governance of a material amount of the assets or operations of a not-for-profit healthcare entity
to an entity or person other than a charity or not-for-profit entity;
c. A substantial change or amendment to a certificate of incorporation which materially affects an entity's charitable or
public benefit intent, or a disposition of reserves or control of a not-for-profit healthcare entity or of a charitable entity
or of an entity holding assets for the public benefit;
d. A change in the composition of the Board of Directors such that, upon the effective date of such change, a majority of
directors of the not-for-profit healthcare entity are affiliated with (or have been elected by directors a majority of whom
were or are affiliated with) any single entity or person other than a charity or not-for-profit entity. For purposes of this
subsection, a director shall be deemed to be affiliated with such entity or person if such director:
1. Receives or has received, directly or indirectly, compensation, including income, in any form from such person or entity
(or parent, subsidiary or affiliate of such entity);
2. Serves or has served as a director, officer, employee, partner, member or agent of such entity (or of a parent, subsidiary
or affiliate of such entity);
3. Is a close family member of such person or is a close family member of any person who serves as an officer or director
of such entity (or parent, subsidiary or affiliate of such entity); or
4. Is, directly or indirectly, controlled by such person or entity.
(2) "Not-for-profit healthcare entity" includes a not-for-profit hospital, including a corporation or a hospital created under
a trust or will, a not for profit healthcare service provider, a not-for-profit nursing home or long term care facility, a
not-for profit healthcare insurer, a mutual corporation holding assets in charitable trust for the public benefit, an entity
maintaining plans to provide healthcare services or indemnity thereof, and an entity, other than a for-profit entity, affiliated
with any of these through ownership, governance, or membership, such as a holding company or subsidiary.
(3) "Not-for-profit healthcare insurer" includes a not-for-profit provider of healthcare insurance, including service associations,
health service corporations, and physician service organizations or their affiliates.
(4) "Person" means an individual, partnership, trust, estate, corporation, association, organization, joint venture, joint
stock company, limited liability company, or other legal or commercial entity.
(5) "Public benefit asset" means, as to a not-for-profit healthcare entity that is seeking to engage in a not-for-profit healthcare
conversion transaction, that part of the fair market value of the converting entity impressed with a public trust for the
public benefit as initially determined by the Attorney General and subject to the approval of the Court of Chancery.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;
§ 2532. Notice to the Attorney General.
A not-for-profit healthcare entity seeking to engage in a not-for-profit healthcare conversion transaction is required to
provide written notice of its intent to enter into the transaction to the Attorney General of the State within 180 days prior
to the closing date of the proposed transaction.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;
§ 2533. Establishment of a foundation.
(a) For proceeds or reserves of not-for-profit healthcare conversion transactions that constitute public benefit assets, there
shall be created a new tax-exempt public benefit or charitable organization or foundation pursuant to 26 U.S.C.§ 501(c)(3)
or § 501(c)(4) of the Federal Internal Revenue Code into which the proceeds or reserves shall be ultimately deposited. Whether
or not the public benefit or charitable organization is classified as a private foundation under § 509 of the Internal Revenue
Code [26 U.S.C. § 509], it shall be subject to the restrictions and limitations that apply to private foundations found in
§ 4941 through 4945 of the Internal Revenue Code [26 U.S.C. §§ 4941 through 4945].
(b) The mission of the public benefit or charitable organization or foundation receiving the public benefit assets shall be
serving the State's unmet health needs, particularly with regard to medically uninsured and underserved populations.
(c) The board of directors of the foundation shall consist of 9 to 15 members who shall be broadly representative of the community's
diversity and shall include persons with knowledge, expertise and skills in investment and asset management, healthcare finance,
not-for-profit administration, delivery of healthcare services, and of health care consumer issues. Each member of the board
of directors shall be appointed by the Governor, by and with the consent of the Senate, from a list of qualified persons who
have been nominated by the Community Advisory Committee established in subsection (d) of this section, below. The directors
shall elect a chairperson. The directors shall have the authority to adopt bylaws for the foundation in consultation with
the Community Advisory Committee. After the directors have finalized the formation of the foundation and the adoption of bylaws,
the State shall transfer the public benefit assets to the foundation.
(d) A Community Advisory Committee shall be formed to nominate candidates for the foundation's board of directors. The initial
Community Advisory Committee shall be comprised of 9 members, 1 selected by each of the following organizations: the Delaware
State Chamber of Commerce, the Medical Society of Delaware, the Delaware Community Foundation, the Delaware Nurses' Association,
the Delaware AFL-CIO, the Delaware Healthcare Association, the United Way of Delaware, the Delaware State Senate, whose member
shall be selected by the President Pro Tem of the Senate, and the Delaware House of Representatives, whose member shall be
selected by the Speaker of the House. The Advisory Committee shall elect a chairperson. Members of the Community Advisory
Committee shall be appointed within 60 days after the State receives public benefits assets from any not-for-profit health
care conversion transaction. The foundation may expand the Community Advisory Committee and provide for additional appointments
through its bylaws. The Community Advisory Committee's criteria for nominating board members shall ensure an open recruitment
process for the directors. The Community Advisory committee shall nominate at least 30 residents of Delaware for the initial
board of directors. At no time shall the Community Advisory Committee nominate 1 of its own members for appointment to the
board of directors of the foundation. In addition to nominating persons for consideration of appointment, the Community Advisory
Committee shall also work with the foundation's board of directors to develop and improve the foundation's mission, certificate
of incorporation and by-laws, and shall provide ongoing guidance to the board concerning community needs and other issues
relating to the activities of the foundation.
(e) The State Treasurer shall open and maintain an escrow account for the benefit of the foundation for the receipt of any
public benefit assets. During the interim time period from when the State receives public benefit assets until they are transferred
to the foundation, the State Treasurer shall invest any funds that are part of the public benefit amount in a manner that
will protect the principal balance of the public benefit assets.
(f) The certificate of incorporation of the foundation shall provide that the directors shall be appointed to the board for
a term of 3 years except as provided herein. The term for each board position shall be staggered by thirds so that the first
term for a board position may be 1, 2 or 3 years and shall be determined by lot. No individual may serve more than 2 terms
consecutively, except for the initial members whose terms are 1 or 2 years who may serve 3 consecutive terms. Notwithstanding
any other law to the contrary, directors of the foundation shall be prohibited from holding over their term once expired even
if their successors have not been duly elected and qualified. The directors shall receive no compensation for their service
on the board of the foundation other than reimbursement for reasonable expenses related to their service. No elected official
may serve as a director of the foundation.
(g) The not-for-profit public benefit or charitable organization or foundation receiving the public benefit assets, its directors,
officers, and management shall be and remain independent of the for-profit company or mutual corporation and its affiliates.
No person who is an officer, director, or member of management of the not-for-profit corporation submitting the plan for the
proposed healthcare conversion transaction, at the time the plan is submitted, or at the time of the agreement or transaction,
or thereafter, shall be qualified to be an officer, director or member of management of the not-for-profit public benefit
or charitable organization or foundation receiving the charitable assets.
(h) The not-for-profit public benefit or charitable organization or foundation receiving the public benefit assets shall establish
formal mechanisms to avoid conflicts of interest and to prohibit grants benefiting the for-profit corporation, the board of
directors and management of the for-profit corporation.
(i) The foundation shall have the power to enter into any contract, acquire, lease, sell, hold or dispose of any assets in
accordance with the purposes of this subchapter; to employ, retain or enter into contracts with persons in connection with
the management and operation of the foundation; to bring or defend, pay, collect, compromise or arbitrate any legal action
by or against the foundation; to deposit withdraw, invest, pay, retain and distribute the foundation's funds in accordance
with this subchapter; to purchase, hold, sell, lease, exchange, receive or otherwise acquire or dispose of securities in the
name of the foundation; to open, maintain and close bank accounts, and draw checks or other orders for the payment of moneys;
and to authorize any officer, director employee or other agent of the foundation to act for and on behalf of the foundation
in all matters incidental to the forgoing.
(j) The charitable organization or foundation receiving the public benefit assets shall provide the Attorney General, the
Governor, and the General Assembly with an annual report of its charitable activities related to its use of the public benefit
assets received. The annual report shall be a public document.
(k) Nothing in this subchapter shall be construed to limit the common law authority of the Attorney General to protect the
charitable trusts and assets held for the public benefit in this State. Nothing in this subchapter shall be construed as a
replacement for any other civil or criminal actions, which the Attorney General may take either under the common law or statutory
law, seeking injunctive relief, or other available remedies.
(l) Nothing in this subchapter shall be construed to supersede, restrict or otherwise limit the powers, duties, and authority
of the Insurance Commissioner pursuant to Title 18, or any other provisions relating to the regulation of insurers, hospitals,
or other health care corporations.
74 Del. Laws, c. 298, § 2; 77 Del. Laws, c. 282, § 2.;