§ 10-436. Sale or transfer of assets

   (a) Scope of section. -- This section does not apply to:

   (1) a transaction undertaken under a contractual obligation in effect on October 1, 1996;

   (2) a transaction made in the ordinary course of business of operating a facility;

   (3) a refund under a contract entered into in the ordinary course of business;

   (4) a transfer of cash, securities, or other investment property in connection with an ordinary investment transaction;

   (5) a grant of a mortgage, deed of trust, or security interest to an unrelated third party;

   (6) a transaction involving an easement, right-of-way, road widening, or similar conveyance for the benefit of a public body or a utility;

   (7) a transaction made for an expansion or renovation; or

   (8) any other sale, transfer, or other disposition exempted by the Department by regulation.

(b) Restrictions on sale or transfer of assets. --

   (1) A provider that holds a preliminary, initial, or renewal certificate of registration may not sell, transfer, or otherwise dispose of more than 10% of its total assets in any 12-month period unless the Department approves the sale, transfer, or disposition in accordance with § 10-437 and 10-438 of this subtitle.

   (2) A provider may not sell, transfer, or otherwise dispose of assets equal to or less than 10% of its total assets if the sale, transfer, or disposition is likely, according to standards set by regulation, to have an unreasonably adverse effect on:

      (i) the financial stability of the provider; or

      (ii) the capacity of the provider to perform its obligations under its continuing care agreements.

   (3) Determinations of total assets shall be based on the provider's latest certified financial statements available at the time the sale, transfer, or other disposition is made.

HISTORY: An. Code 1957, art. 70B, § 11E(a), (b); 2007, ch. 3, § 2.