IC 23-13-5
    Chapter 5. Management of Educational Institutions EstablishedUnder General Laws and Special Enactments

IC 23-13-5-1
Election of governing or administrative body by board of directors
    Sec. 1. Any university, college or other institution of learningheretofore organized and now existing under special enactments ofthe general assembly of the state of Indiana, constituting the charterof the institution, or which now is or hereafter may be organizedunder the general laws of the state of Indiana, may provide that theboard of directors, trustees or other governing or administrative bodythereof may from time to time be elected by such board of directorsinstead of by stockholders or otherwise.
(Formerly: Acts 1909, c.52, s.1.)

IC 23-13-5-2
Articles of association; contents
    Sec. 2. In all cases of corporations organized after March 3, 1909,desiring to accept the provisions of this chapter, the corporation shallin its articles of association specifically set forth the number oftrustees, directors, or other members of its governing oradministrative board, the manner of election, their powers, and thesystem adopted for administering their respective funds.
(Formerly: Acts 1909, c.52, s.2.) As amended by P.L.34-1987,SEC.343.

IC 23-13-5-3
Procedure for accepting provisions of chapter
    Sec. 3. (a) All such corporations created before March 3, 1909,and existing on March 3, 1909, desiring to accept the provisions ofthis chapter may do so in the manner following, that is to say: At anyregular meeting of the stockholders or others authorized to electtrustees or directors, such election shall be held in the usual manner;and thereupon such stockholders or electors may upon theaffirmative vote of not less than two-thirds (2/3) in value of all thestock of such institution accept the provisions of this chapter for suchcorporation and may vote and declare that the board so elected andtheir successors shall be authorized and empowered thereafter fromtime to time to elect the directors, trustees, or other governing bodyof such institution; provided, also, that any university, college, orother institution of learning, the graduates of which university,college, or other institution of learning have and maintain an activealumni association, organized and operating under a constitution andbylaws and which constitution defines who shall be the activemembers of such alumni association and which university, college,or institution of learning is operating on March 3, 1909, under thischapter, by resolution duly passed at any regular meeting of theboard of directors, trustees, or other governing body of suchuniversity, college, or institution of learning, or at a special meeting

of such board of directors, trustees, or other governing body of suchinstitution, called for that purpose, of which meeting, and the time,place, and the purpose thereof, ten (10) days notice, in writing, shallbe given to all directors, trustees, or other governing body, and by amajority vote of the directors, trustees, or other governing body, mayprovide:
        (1) that, after a date to be fixed in said resolution, and whichdate so fixed shall not be less than one hundred twenty (120)days from the date on which such resolution shall be passed, thenumber of directors, trustees, or members of the governingboard thereof shall be nine (9);
        (2) that five (5) of such members shall be selected by the saidgoverning body;
        (3) that four (4) of such members shall be selected by the activemembers of the alumni association of such university, college,or institution of learning;
        (4) that of the five (5) to be selected by such governing body,one (1) shall be elected to serve for the term of one (1) year, one(1) for the term of two (2) years, and three (3) for the term ofthree (3) years;
        (5) that of the four (4) to be elected by the alumni association,one (1) shall be elected for the term of one (1) year, one (1) forthe term of two (2) years, and two (2) for the term of three (3)years, and that thereafter the term of office of all members ofsuch governing body shall be three (3) years, except when anelection is had to fill a vacancy, in which case the election shallbe only for the unexpired term;
        (6) that the annual meeting of such board of trustees, directors,or other governing body shall be held on the first Monday ofJuly in each year and that the term of office of outgoingdirectors, trustees, or other officers of such governing bodyshall expire on the date of such annual meeting and that theterms of the newly elected trustees, directors, or other officersof such governing body shall commence on said date;
        (7) that the officers to be elected by said alumni associationshall be elected by ballot, to be cast and taken at such time andin such manner, at such time and for such candidates as may beselected by the members of such alumni association, all inaccordance with a resolution duly passed by such board ofdirectors, trustees, or other governing body of such university,college, or other educational institution.
    (b) A certified copy of the resolution of the board of trustees,directors, or other governing body of such university, college, orother institution of learning, duly attested as to its passage and itscorrectness, filed with the secretary of state and with the recorder ofthe county in which such university, college, or other institution oflearning is situated, shall constitute an amendment of its said charterconformable to the provisions of this chapter.
(Formerly: Acts 1909, c.52, s.3; Acts 1929, c.210, s.1.) As amendedby P.L.34-1987, SEC.344.
IC 23-13-5-4
Perpetual existence; merger
    Sec. 4. Any postsecondary educational institution which may beorganized before, on, or after March 3, 1909, under or which mayotherwise become subject to the provisions of this chapter shall bedeemed to have a perpetual existence by operation of law. Any two(2) or more postsecondary educational institutions incorporatedunder the provisions of this chapter may be merged into one (1)corporation by the action of the boards of trustees of the respectivecorporations.
(Formerly: Acts 1909, c.52, s.3a; Acts 1953, c.17, s.1.) As amendedby P.L.34-1987, SEC.345; P.L.2-2007, SEC.315.

IC 23-13-5-5
Assignment of capital stock of institution to board of directors ortrustees
    Sec. 5. And at the same meeting of stockholders mentioned insection 3 of this chapter, or at any meeting of stockholders called forthe purpose by the board of directors or trustees of such institution,upon not less than four (4) advertisements therefor, once a week forfour (4) successive weeks preceding such meeting, printed in two (2)newspapers of general circulation published in the city ofIndianapolis, Indiana, giving the date and place of such meeting, andthe matters to be considered and acted upon thereat, the stockholdersof said corporation created before March 3, 1909, and existing onMarch 3, 1909, may, by the vote of two-thirds (2/3) in value of allthe stock of such corporation, vote that all the capital stock of thecorporation shall be assigned and turned over to the directors ortrustees of the corporation to be held by said directors for the benefitof the corporation. Upon such vote, the directors or trustees and theirsuccessors are and shall be authorized to hold for the benefit of saidcorporation exclusively and to vote any stock that may be so assignedand turned over to them. And when all the stock of said corporationshall, by virtue of the provisions of this chapter or otherwise, havecome under the control or ownership of said directors or trustees,then they shall cancel the entire capital stock of such corporation,and such corporation shall cease to be represented in any sense bycapital stock.
(Formerly: Acts 1909, c.52, s.4.) As amended by P.L.34-1987,SEC.346.

IC 23-13-5-6
Purchasing shares of dissatisfied stockholders; determination ofvalue
    Sec. 6. The board of directors of any such corporation is herebyauthorized to buy in for the corporation the share or shares of stockof any person or persons dissatisfied with the action of the majorityof stockholders provided for in section 3 or 4 of this chapter,provided such dissatisfied stockholders did not vote with themajority at such meeting or meetings. If any such dissatisfied

stockholder shall not be satisfied with the price offered for his stockby said directors or trustees, then he may apply by petition to one (1)of the judges of the circuit or superior courts, if any, of the countywhere such institution is located, making the corporation defendanttherein, praying said court to appoint three (3) disinterested personsto estimate and appraise the fair cash value of the shares of suchstock owned by the petitioner, and shall at the same time file with theclerk his certificate of stock in said corporation. And the value ofsuch shares having been so appraised by said commissioners, by avote of a majority thereof, shall be reported to said court, and whenconfirmed by the court, shall be final and conclusive on all parties,and thereupon said corporation shall be decreed to be the owner ofsuch shares, and the petitioner shall assign his said stock to saidcorporation and deliver to said board of directors or trustees thecertificate therefor and shall be paid the appraised value thereof outof the endowment or other funds of said corporation. Should anysuch petitioner fail after such appraisement to so assign and deliversaid stock and the certificate therefor within sixty (60) days after theconfirmation of such appraisal therefor, the said directors or trusteesmay make payment of the amount of such award to the clerk of thecourt for the party entitled thereto and, upon such payment, the clerkshall assign and deliver to said directors or trustees the said stock andcertificate. The costs of such proceeding and appraisement shall bepaid by the corporation in case the appraised value of such stockexceeds the sum offered therefor by such directors or trustees;otherwise such costs shall be paid by the petitioner.
(Formerly: Acts 1909, c.52, s.5.) As amended by P.L.34-1987,SEC.347.

IC 23-13-5-7
Nonappearing stockholders; determination of value of shares
    Sec. 7. Whenever a majority in value of the capital stock of anysuch corporation existing on March 3, 1909, shall have been assignedand turned over to the directors or trustees, as provided for insections 5 and 6 of this chapter, the directors or trustees of suchcorporation may, if they see fit, cause to be filed in the circuit courtor superior court, if any, of the county where the institution is locatedthe petition of said institution, making defendant thereto any knownstockholder or stockholders, as shown by the stock register of thecorporation, or the stockholder's administrator and heirs (if thestockholder is dead) including the surviving spouse and any unknownheirs of such stockholder, and praying the court to appoint three (3)disinterested persons to estimate and appraise the fair cash value ofthe stock held by such persons. If it appear by affidavit that the nameor residence of any stockholder or defendant is unknown or that theperson is a nonresident of the state of Indiana, or that the person isbelieved to be dead and that the names of the person's survivingspouse and heirs or either are unknown, the clerk, by order of thecourt, shall cause a notice of the pendency of such action and theterm at which the same will stand for trial to be published for three

(3) weeks successively in some newspaper of general circulationprinted in the English language and published in said county. Andthe value of such shares having been so appraised by saidcommissioners, by a vote of a majority thereof, when confirmed bythe court, shall be final and conclusive upon all parties. Andthereupon said corporation shall be decreed to be the purchaser andowner of such shares as against all parties served with notice oragainst whom or the unknown surviving spouse or heirs of whompublication was made as provided in this section, at and for the valueof their respective shares as fixed by such appraisement; and saiddirectors or trustees shall thereupon cause entry of such purchase andownership to be noted upon the stock register of the corporation, andshall pay to the respective owners of such stock the value thereof asfixed by said appraisement whenever the owners shall present thecertificate for such shares owned and assign the same to suchcorporation or the directors or trustees thereof.
(Formerly: Acts 1909, c.52, s.6.) As amended by P.L.34-1987,SEC.348.

IC 23-13-5-8
Nullifying action of board regarding corporate stock; vestingproperty and assets in local public school corporation; vesting incounty; bonds
    Sec. 8. (a) Should for any cause any action of the board ofdirectors or trustees of a corporation be invalid or ineffective inwhole or in part as and for a cancellation or retirement of capitalstock as provided in this chapter, then the entire act of cancellationor retirement as to all other stock shall be held null and void. If atany time after the transfer of any stock to the corporation or to thetrustees or directors it becomes no longer possible for the corporationto operate the postsecondary educational institution as apostsecondary educational institution, and the fact is found to existby the board of trustees or directors, the property and assets of thecorporation vest in and belong absolutely to the local public schoolcorporation within whose territorial limits the postsecondaryeducational institution is situated unless the local public schoolcorporation elects to refuse to accept the property and assets inwriting served upon the board of trustees or an officer thereof withinone hundred twenty (120) days. If the local public school corporationelects to refuse to accept the property and assets, then the propertyand assets of the corporation vest in and belong absolutely to thecounty within whose territorial limits the postsecondary educationalinstitution is situated unless the county, acting by its legislative body,elects to refuse to accept the property and assets in writing servedupon the board of trustees or an officer within one hundred twenty(120) days. If the county refuses to accept the property and assets,the property and assets vest in and belong absolutely to the stategeneral fund. If the postsecondary educational institution is situatedin a school township, the election shall be made by the townshipexecutive with the approval of the township legislative body. If

situated in a school city or town corporation, the election shall bemade by the school board of the municipality.
    (b) The local school corporation receiving the property or assetsis responsible for the payment of the lawful debts and liabilities ofthe corporation. For the purpose of raising funds to pay the debts andliabilities, the township executive, with the concurrence and sanctionof the township legislative body, or the city or town school board, asthe case may be, is authorized and empowered to issue and sell bondsof the school township, school city, or school town. The debt createdby the bonds, together with all other indebtedness of the schoolcorporation, may not exceed two percent (2%) of the adjusted valueof the taxable property within the school corporation as determinedunder IC 36-1-15. If the building or property of the corporationvested in the school corporation is suitable for instructing studentsof the township in the arts of agriculture, domestic science, orphysical or practical mental culture, and in which to hold school orcivic entertainments or be used for township, town, or city purposes,then the township executive, with the concurrence and sanction ofthe township, city, or town legislative body, as the case may be, isauthorized and empowered to issue and sell bonds of the civiltownship, city, or town, as the case may be, and apply the proceedsto the payment of the debts and liabilities of the corporation. Theproceeds of the bonds, together with all other indebtedness of thecivil township, city, or town, may not exceed two percent (2%) of theadjusted value of the taxable property within the civil township, city,or town, as determined under IC 36-1-15. If the county receives theproperty, it is authorized to issue its general obligation bonds to paythe debts and liabilities as general obligation bonds of counties areissued under the general law. Unless the school and civil townshipsand school and civil cities and towns can liquidate the debts andliabilities without violating Article 13, Section 1 of the Constitutionof the State of Indiana and IC 36-1-15, they shall elect to refuse toaccept the property. Unless the county can liquidate the debts andliabilities without violating the constitutional provision, it shall electto refuse the property. If a civil township, city, or town uses its fundsor the proceeds of the sale of its bonds to liquidate the debts andliabilities, it shall have an interest in the property in the proportionthe funds expended by it bear to the funds expended by the schooltownship, school city, or school town.
    (c) Any bonds issued under this chapter shall be payable in notmore than twenty (20) years after the date of their issuance. Themunicipal corporation issuing the bonds shall annually levy a tax onall of the taxable property within the municipal corporation in anamount sufficient to pay the interest on and the principal of suchbonds as they mature. The bonds may mature and be payable eithersemiannually or annually. Notice of sale of the bonds shall bepublished once each week for two (2) weeks in a newspaperpublished in the municipal corporation issuing the bonds, or in anewspaper published in the county seat of the county in which themunicipal corporation is located. Additional notices may be

published.
    (d) If the corporation ceases to exist or winds up its affairswithout its board of trustees or directors finding that it is no longerpossible for the corporation to operate the university, college, orinstitution of learning as a postsecondary educational institution, thisshall have the same effect as such a finding.
(Formerly: Acts 1909, c.52, s.7; Acts 1949, c.147, s.1; Acts 1951,c.78, s.1.) As amended by P.L.8-1987, SEC.74; P.L.8-1989, SEC.83;P.L.1-1993, SEC.192; P.L.6-1997, SEC.196; P.L.246-2005,SEC.208; P.L.2-2007, SEC.316.

IC 23-13-5-9
Certificate regarding assignment of shares
    Sec. 9. Whenever this chapter shall have been accepted by a voteof the stockholders, as provided in section 3 of this chapter, and notless than two-thirds (2/3) of all outstanding stock of the corporationshall have been assigned and turned over to the directors or trusteesfor the corporation, or directly to the corporation, then a certificatecontaining a copy of the resolutions or other proceedings and votesin said matter had and done at such stockholders' meeting, and alsostating that such two-thirds (2/3) of all such stock has been so dulyassigned and turned over, signed by the president of the directors orother chief executive officer of such corporation, and attested by thesecretary thereof and the corporate seal of such institution attachedthereto, shall be filed with the secretary of state for the state ofIndiana, and thereupon, the same shall be taken and deemed as anamendment to and part and parcel of the charter of such institution,but such charter shall not be taken or deemed as altered or amendedin any other respect than as specified in such resolution or votes.
(Formerly: Acts 1909, c.52, s.8.) As amended by P.L.34-1987,SEC.349.

IC 23-13-5-10
Presumption of assignment
    Sec. 10. After one (1) year from the date of any such stockholders'meeting, all stockholders shall be conclusively presumed to haveassented to the action thereof and to have assigned their stock to saiddirectors or trustees accordingly, unless, within such year, they shallhave filed their respective petitions as provided for the valuation andsale of their stock. After one (1) year from the entry of any decree ofcourt hereinbefore provided for, no appeal shall lie therefrom.
(Formerly: Acts 1909, c.52, s.9.)