§18B-12-3. Boards authorized to contract with corporations; characteristics of corporations.

Each governing board for a state institution of higher education may enter into agreements and any other contractual relationships with one or more corporations formed with respect to such state institution of higher education, but only if each such corporation meets the following descriptions:

(1) The president and the president's appointees from the institution shall constitute a majority of the voting corporate directors: Provided, That the voting corporate directors of any entity established to conduct operational, economic, fiscal, and educational development activities and services related to intercollegiate athletics shall consist solely of employees of the institution of higher education or an employee of an affiliate of the institution of higher education.

(2) The corporation shall be organized as a nonprofit, nonstock corporation under the general corporation laws of the state exclusively for charitable, educational or scientific purposes within the meaning of section 501(c)(3) of the Internal Revenue Code of 1986, as amended, to engage in one or more of the following: (a) to foster and support research and economic development efforts at the respective state institution of higher education; (b) to provide evaluation, development, patenting, management and marketing services for inventions of the faculty, staff and students of such state institution of higher education; and (c) to conduct operational economic, fiscal, and educational development activities and services related to intercollegiate athletics’ programs at state institutions of higher education.

(3) The meetings of the corporate directors shall be subject to §6-9A-3 of this code: Provided, however, that matters relating to the conduct of operational, economic, fiscal and educational development activities and services related to intercollegiate athletics’ programs are exempt from §6-9A-3 and §29B-1-1, et seq. of this code.

(4) Notwithstanding any other provision of this code to the contrary, institutional boards of governors may assign rights and delegate obligations and provide and transfer funding and property, both real and personal, to corporations as defined in section one of this article, and with which the institution under its jurisdiction has contracted pursuant to the provisions of this article, and any such transfers shall be exempt from the provisions of §18B-19-1 et seq. of this code.

(5) Upon dissolution of the corporation, the assets of the corporation shall be transferred to such entity as the appropriate governing board shall designate for the benefit of the state institution of higher education: Provided, That such recipient shall be an organization operated exclusively for charitable, educational, or scientific purposes as shall at such time qualify as an exempt organization under section 501(c)(3) of the Internal Revenue Code of 1986, as amended.