PRINTER'S NO. 283
No. 276 Session of 2003
INTRODUCED BY GREENLEAF, COSTA, LEMMOND AND O'PAKE,
FEBRUARY 10, 2003
REFERRED TO JUDICIARY, FEBRUARY 10, 2003
AN ACT
1 Amending Title 15 (Corporations and Unincorporated Associations)
2 of the Pennsylvania Consolidated Statutes, further providing
3 for procedures in the Department of State, for electronic
4 notices and communications, for issuance of shares of
5 business corporations, for fundamental transactions involving
6 business corporations, for limited liability companies and
7 for nonprofit corporations and unincorporated nonprofit
8 associations; making revisions, corrections and additions;
9 repealing certain acts and parts of acts; and making
10 editorial corrections.
11 The General Assembly of the Commonwealth of Pennsylvania
12 hereby enacts as follows:
13 Section 1. Short title.
14 This act shall be known and may be cited as the GAA
15 Amendments Act of 2003.
16 Section 2. Amendment of Title 15.
17 As much of Title 15 of the Pennsylvania Consolidated Statutes
18 as is hereinafter set forth is reenacted, amended or added to
19 read:
20 § 102. Definitions.
21 Subject to additional or inconsistent definitions contained
1 in subsequent provisions of this title that are applicable to
2 specific provisions of this title, the following words and
3 phrases when used in this title shall have, unless the context
4 clearly indicates otherwise, the meanings given to them in this
5 section:
6 * * *
7 "Execute." When used with respect to authenticating a
8 filing, document or other record, means "sign."
9 * * *
10 "Officially publish." Publish in two newspapers of general
11 circulation in the English language in the county in which the
12 registered office of the association is located, or in the case
13 of a proposed association is to be located, one of which shall
14 be the legal newspaper, if any, designated by the rules of court
15 for the publication of legal notices or, if there is no legal
16 newspaper, in two newspapers of general circulation in the
17 county. When there is but one newspaper of general circulation
18 in any county, advertisement in that newspaper shall be
19 sufficient. Where no other frequency is specified, the notice
20 shall be published one time in the appropriate newspaper or
21 newspapers. See section 109(a)(2) (relating to name of
22 commercial registered office provider in lieu of registered
23 address).
24 * * *
25 "Record form." Inscribed on a tangible medium or stored in
26 an electronic or other medium and retrievable in tangible and
27 reasonably legible form.
28 * * *
29 "Sign." Includes:
30 (1) to sign manually or adopt a tangible symbol with the
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1 present intent to authenticate a record; or
2 (2) to attach to, or logically associate with, a record
3 an electronic symbol, sound or process with the present
4 intent to authenticate the record.
5 * * *
6 § 107. Form of records.
7 (a) General rule.--Any records maintained by a corporation
8 or other association in the regular course of its business,
9 including shareholder or membership records, books of account
10 and minute books, may be kept [on, or be in the form of, punch
11 cards, magnetic storage media, photographs, microphotographs or
12 any other information storage device if the records so kept can
13 be converted into reasonably legible written form within a
14 reasonable time] in record form. Any corporation or other
15 association shall [so] convert any records so kept into a
16 tangible and reasonably legible form upon the request of any
17 person entitled to inspect the records. Where records are kept
18 in [this manner, a] record form, a tangible and reasonably
19 legible [written] form [produced from the information storage
20 device] that accurately portrays the record shall be admissible
21 in evidence, and shall be accepted for all other purposes, to
22 the same extent as an original written record of the same
23 information would have been accepted.
24 (b) Meaning of "written."--References in this title to a
25 document in writing or to a written provision of an agreement or
26 other document shall be deemed to include and be satisfied by a
27 document or provision of an agreement or document in record
28 form.
29 § 131. Application of subchapter.
30 As used in this subchapter, the term "this title" includes
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1 Titles 17 (relating to credit unions) and 54 (relating to names)
2 and any other provision of law that makes reference to the
3 powers and procedures of this subchapter or, to the extent not
4 inconsistent with this subchapter, requires a filing in the
5 Corporation Bureau of the Department of State and does not
6 specify some or all of the necessary procedures therefor
7 provided in this subchapter.
8 § 133. Powers of Department of State.
9 (a) General rule.--The Department of State shall have the
10 power and authority reasonably necessary to enable it to
11 administer this subchapter efficiently and to perform the
12 functions specified in section 132 (relating to functions of
13 Department of State), in 13 Pa.C.S. (relating to commercial
14 code) and in 17 Pa.C.S. (relating to credit unions). The
15 following shall not be agency regulations for the purposes of
16 section 612 of the act of April 9, 1929 (P.L.177, No.175), known
17 as The Administrative Code of 1929, the act of October 15, 1980
18 (P.L.950, No.164), known as the Commonwealth Attorneys Act, the
19 act of June 25, 1982 (P.L.633, No.181), known as the Regulatory
20 Review Act, or any similar provision of law, but shall be
21 subject to the opportunity of public comment requirement under
22 section 201 of the act of July 31, 1968 (P.L.769, No.240),
23 referred to as the Commonwealth Documents Law:
24 (1) Sample filing forms promulgated by the department
25 under subsection (d).
26 (2) Instructions accompanying sample filing forms and
27 other explanatory material published in the Pennsylvania Code
28 that is intended to substantially track applicable statutory
29 provisions relating to the particular filing or to any of the
30 functions of the department covered by this subsection, if a
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1 regulation of the department expressly states that such
2 instructions or explanatory materials shall not have the
3 force of law.
4 (3) Regulations, which the department is hereby
5 authorized to promulgate, that:
6 (i) Authorize payment of fees and other remittances
7 through or by a credit or debit card issuer or other
8 financial intermediary.
9 (ii) Authorize contracts with credit or debit card
10 issuers and other financial intermediaries relating to
11 the collection, transmission and payment of fees and
12 other remittances.
13 [(iii) Adjust the level of fees and other
14 remittances as otherwise fixed by law so as to facilitate
15 their transmission through or by a credit card issuer or
16 other financial intermediary pursuant to such regulations
17 without net cost to the department.]
18 * * *
19 § 153. Fee schedule.
20 (a) General rule.--The fees of the Corporation Bureau of the
21 department, including fees for the public acts and transactions
22 of the Secretary of the Commonwealth administered through the
23 bureau, shall be as follows:
24 * * *
25 (15) Unincorporated nonprofit
26 associations:
27 (i) Statement appointing an agent to
28 receive service of process................. 52
29 (ii) Resignation of appointed agent... 28
30 (iii) Each ancillary transaction...... 52
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1 * * *
2 § 1103. Definitions.
3 Subject to additional definitions contained in subsequent
4 provisions of this subpart that are applicable to specific
5 provisions of this subpart, the following words and phrases when
6 used in this subpart shall have the meanings given to them in
7 this section unless the context clearly indicates otherwise:
8 * * *
9 "Distribution." A direct or indirect transfer of money or
10 other property (except its own shares or options, rights or
11 warrants to acquire its own shares) or incurrence of
12 indebtedness by a corporation to or for the benefit of any or
13 all of its shareholders in respect of any of its shares whether
14 by dividend or by purchase, redemption or other acquisition of
15 its shares or otherwise. Neither the making of, nor payment or
16 performance upon, a guaranty or similar arrangement by a
17 corporation for the benefit of any or all of its shareholders
18 nor a direct or indirect transfer or allocation of assets or
19 liabilities effected under Chapter 19 (relating to fundamental
20 changes) with the approval of the shareholders shall constitute
21 a distribution for the purposes of this subpart.
22 "Execute." When used with respect to authenticating a
23 filing, document or other record, means "sign."
24 * * *
25 "Record form." Inscribed on a tangible medium or stored in
26 an electronic or other medium and retrievable in tangible and
27 reasonably legible form.
28 * * *
29 "Sign." Includes:
30 (1) to sign manually or adopt a tangible symbol with the
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1 present intent to authenticate a record; or
2 (2) to attach to, or logically associate with, a record
3 an electronic symbol, sound or process with the present
4 intent to authenticate the record.
5 * * *
6 "Voting" or "casting a vote." Includes the giving of
7 [written] consent in lieu of voting. The term does not include
8 either recording the fact of abstention or failing to vote for a
9 candidate or for approval or disapproval of a matter, whether or
10 not the person entitled to vote characterizes the conduct as
11 voting or casting a vote.
12 § 1521. Authorized shares.
13 * * *
14 (d) Status and rights.--Shares of a business corporation
15 shall be deemed personal property. Except as otherwise provided
16 by the articles or, when so permitted by subsection (c), by one
17 or more bylaws adopted by the shareholders, the terms of each
18 share shall be in all respects equal to every other share. See
19 section 1906(d)(4) (relating to special treatment of holders of
20 shares of same class or series).
21 § 1523. Pricing and issuance of shares.
22 Except as otherwise restricted in the bylaws, shares of a
23 business corporation may be issued at a price determined by the
24 board of directors, or the board may [set a minimum price or
25 establish a formula or method by which the price may be
26 determined] authorize one or more officers, acting alone or with
27 the participation of one or more directors, to determine the
28 purchasers, number of shares, price and other terms on which
29 shares will be issued, within limits and subject to relevant
30 criteria which shall be specifically prescribed by the board.
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1 § 1704. Place and notice of meetings of shareholders.
2 (a) Place.--Meetings of shareholders may be held at such
3 geographic location within or without this Commonwealth as may
4 be provided in or fixed pursuant to the bylaws. Unless otherwise
5 provided in or pursuant to the bylaws, all meetings of the
6 shareholders shall be held at the executive office of the
7 corporation wherever situated. If a meeting of the shareholders
8 is held by means of the Internet or other electronic
9 communications technology in a fashion pursuant to which the
10 shareholders have the opportunity to read or hear the
11 proceedings substantially concurrently with their occurrence,
12 vote on matters submitted to the shareholders [and], pose
13 questions to the directors, make appropriate motions and comment
14 on the business of the meeting, the meeting need not be held at
15 a particular geographic location.
16 (b) Notice.--[Written notice] Notice of every meeting of the
17 shareholders shall be given by, or at the direction of, the
18 secretary or other authorized person to each shareholder of
19 record entitled to vote at the meeting at least:
20 (1) ten days prior to the day named for a meeting that
21 will consider a fundamental change under Chapter 19 (relating
22 to fundamental changes); or
23 (2) five days prior to the day named for the meeting in
24 any other case.
25 If the secretary or other authorized person neglects or refuses
26 to give notice of a meeting, the person or persons calling the
27 meeting may do so.
28 * * *
29 (d) Cross reference.--See section 2528 (relating to notice
30 of shareholder meetings).
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1 § 1705. Waiver of notice.
2 (a) [Written waiver] General rule.--Whenever any [written]
3 notice is required to be given under the provisions of this
4 subpart or the articles or bylaws of any business corporation, a
5 waiver thereof [in writing, signed] that is filed with the
6 secretary of the corporation in record form signed by the person
7 or persons entitled to the notice, whether before or after the
8 time stated therein, shall be deemed equivalent to the giving of
9 the notice. Neither the business to be transacted at, nor the
10 purpose of, a meeting need be specified in the waiver of notice
11 of the meeting.
12 * * *
13 § 1727. Quorum of and action by directors.
14 * * *
15 (b) Action by consent.--Unless otherwise restricted in the
16 bylaws, any action required or permitted to be taken at a
17 meeting of the directors may be taken without a meeting if,
18 prior or subsequent to the action, a consent or consents thereto
19 in record form signed by all of the directors in office is filed
20 with the secretary of the corporation.
21 § 1759. Voting and other action by proxy.
22 (a) General rule.--
23 (1) Every shareholder entitled to vote at a meeting of
24 shareholders or to express consent or dissent to corporate
25 action [in writing] without a meeting may authorize another
26 person to act for him by proxy.
27 (2) The presence of, or vote or other action at a
28 meeting of shareholders, or the expression of consent or
29 dissent to corporate action [in writing], by a proxy of a
30 shareholder shall constitute the presence of, or vote or
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1 action by, or [written] consent or dissent of the shareholder
2 for the purposes of this subpart.
3 (3) Where two or more proxies of a shareholder are
4 present, the corporation shall, unless otherwise expressly
5 provided in the proxy, accept as the vote or other action of
6 all shares represented thereby the vote cast or other action
7 taken by a majority of them and, if a majority of the proxies
8 cannot agree whether the shares represented shall be voted or
9 upon the manner of voting the shares or taking the other
10 action, the voting of the shares or right to take other
11 action shall be divided equally among those persons.
12 * * *
13 (c) Revocation.--A proxy, unless coupled with an interest,
14 shall be revocable at will, notwithstanding any other agreement
15 or any provision in the proxy to the contrary, but the
16 revocation of a proxy shall not be effective until notice
17 thereof has been given to the secretary of the corporation or
18 its designated agent in writing or by electronic transmission.
19 An unrevoked proxy shall not be valid after three years from the
20 date of its execution, authentication or transmission unless a
21 longer time is expressly provided therein. A proxy shall not be
22 revoked by the death or incapacity of the maker unless, before
23 the vote is counted or the authority is exercised, [written]
24 notice of the death or incapacity is given to the secretary of
25 the corporation or its designated agent.
26 * * *
27 (e) Cross [reference] references.--See [section] sections
28 1702 (relating to manner of giving notice) and 3135 (relating to
29 proxies of members of mutual insurance companies).
30 § 1764. Voting lists.
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1 (a) General rule.--The officer or agent having charge of the
2 transfer books for shares of a business corporation shall make a
3 complete list of the shareholders entitled to vote at any
4 meeting of shareholders, arranged in alphabetical order, with
5 the address of and the number of shares held by each. This
6 section does not require the corporation to include electronic
7 mail addresses or other electronic contact information on the
8 list. The list shall be produced and kept open at the time and
9 place of [the] each meeting of shareholders of a nonregistered
10 corporation held at a geographic location and shall be subject
11 to the inspection of any shareholder during the whole time of
12 the meeting for the purposes thereof [except that, if a business
13 corporation has 5,000 or more shareholders, in lieu of the
14 making of the list the corporation may make the information
15 therein available at the meeting by any other means]. See
16 section 2529 (relating to voting lists).
17 * * *
18 (c) Electronic meetings.--If a meeting of shareholders of a
19 nonregistered corporation is not held at a geographic location,
20 the corporation shall make the list of shareholders required by
21 subsection (a) available on a reasonably accessible electronic
22 network if the information required to gain access to the list
23 is provided with the notice of the meeting and the list is
24 accessible during the whole time of the meeting.
25 § 1766. Consent of shareholders in lieu of meeting.
26 (a) Unanimous consent.--Unless otherwise restricted in the
27 bylaws, any action required or permitted to be taken at a
28 meeting of the shareholders or of a class of shareholders of a
29 business corporation may be taken without a meeting if, prior or
30 subsequent to the action, a consent or consents thereto signed
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1 by all of the shareholders who would be entitled to vote at a
2 meeting for such purpose shall be filed in record form with the
3 secretary of the corporation.
4 (b) Partial consent.--If the bylaws so provide, any action
5 required or permitted to be taken at a meeting of the
6 shareholders or of a class of shareholders may be taken without
7 a meeting upon the signed consent of shareholders who would have
8 been entitled to cast the minimum number of votes that would be
9 necessary to authorize the action at a meeting at which all
10 shareholders entitled to vote thereon were present and voting.
11 The consents shall be filed in record form with the secretary of
12 the corporation.
13 * * *
14 (d) Cross [reference] references.--See [section] sections
15 1702 (relating to manner of giving notice) and 2524 (relating to
16 consent of shareholders in lieu of meeting).
17 § 1906. Special treatment of holders of shares of same class or
18 series.
19 * * *
20 (c.1) Determination of groups.--For purposes of applying the
21 provisions of subsections (a)(1) and (b), the determination of
22 which shareholders are part of each group receiving special
23 treatment shall be made as of the record date for shareholder
24 action on the plan.
25 (d) Exceptions.--This section shall not apply to:
26 * * *
27 (3) A plan that contains an express provision that this
28 section shall not apply or that fails to contain an express
29 provision that this section shall apply. The shareholders of
30 a corporation that proposes a plan providing for special
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1 treatment to which this section is not applicable by reason
2 of this paragraph shall have the remedies contemplated by
3 section 1105 (relating to restriction on equitable relief).
4 * * *
5 § 1907. Purpose of fundamental transactions.
6 It shall not be necessary for a transaction under this
7 chapter to have an independent business purpose in order for the
8 transaction to be lawful.
9 § 1911. Amendment of articles authorized.
10 (a) General rule.--A business corporation, in the manner
11 provided in this subchapter, may from time to time amend its
12 articles for one or more of the following purposes:
13 * * *
14 (4) To cancel or otherwise affect the right of holders
15 of the shares of any class or series to receive dividends
16 that have accrued but have not been declared or to otherwise
17 effect a reclassification of or otherwise affect the
18 substantial rights of the holders of any shares, including,
19 without limitation, by providing special treatment of shares
20 held by any shareholder or group of shareholders [as
21 authorized by, and subject to the provisions of,] in
22 accordance with section 1906 (relating to special treatment
23 of holders of shares of same class or series).
24 * * *
25 § 1913. Notice of meeting of shareholders.
26 (a) General rule.--[Written notice] Notice of the meeting of
27 shareholders of a business corporation that will act on the
28 proposed amendment shall be given to each shareholder entitled
29 to vote thereon. [There shall be included in, or enclosed with,
30 the notice] The notice shall include a copy of the proposed
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1 amendment or a summary of the changes to be effected thereby
2 and, if Subchapter D of Chapter 15 (relating to dissenters
3 rights) is applicable, a copy of that subchapter.
4 (b) Cross [reference] references.--See Subchapter A of
5 Chapter 17 (relating to notice and meetings generally) and
6 section 2528 (relating to notice of shareholder meetings).
7 § 1923. Notice of meeting of shareholders.
8 (a) General rule.--[Written notice] Notice of the meeting of
9 shareholders that will act on the proposed plan shall be given
10 to each shareholder of record, whether or not entitled to vote
11 thereon, of each domestic business corporation that is a party
12 to the merger or consolidation. [There shall be included in, or
13 enclosed with, the notice] The notice shall include a copy of
14 the proposed plan or a summary thereof [and, if]. If Subchapter
15 D of Chapter 15 (relating to dissenters rights) is applicable to
16 the holders of shares of any class or series, a copy of that
17 subchapter and of section 1930 (relating to dissenters rights)
18 shall be furnished to the holders of shares of that class or
19 series. If the surviving or new corporation will be a
20 nonregistered corporation, the notice shall state that a copy of
21 its bylaws as they will be in effect immediately following the
22 merger or consolidation will be furnished to any shareholder on
23 request and without cost.
24 (b) Cross references.--See Subchapter A of Chapter 17
25 (relating to notice and meetings generally) and [section]
26 sections 2512 (relating to dissenters rights procedure) and 2528
27 (relating to notice of shareholder meetings).
28 § 1957. Effect of division.
29 * * *
30 (b) Property rights; allocations of assets and
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1 liabilities.--
2 (1) * * *
3 (iv) [To] Except as provided in section 1952(g)
4 (relating to proposal and adoption of plan of division),
5 to the extent allocations of liabilities are contemplated
6 by the plan of division, the liabilities of the dividing
7 corporation shall be deemed without further action to be
8 allocated to and become the liabilities of the resulting
9 corporations on such a manner and basis and with such
10 effect as is specified in the plan; and one or more, but
11 less than all, of the resulting corporations shall be
12 free of the liabilities of the dividing corporation to
13 the extent, if any, specified in the plan, if in either
14 case:
15 (A) no fraud on minority shareholders or
16 shareholders without voting rights or violation of
17 law shall be effected thereby; and
18 (B) the plan does not constitute a fraudulent
19 transfer under 12 Pa.C.S. Ch. 51 (relating to
20 fraudulent transfers).
21 * * *
22 § 1973. Notice of meeting of shareholders.
23 (a) General rule.--[Written notice] Notice of the meeting of
24 shareholders that will consider the resolution recommending
25 dissolution of the business corporation shall be given to each
26 shareholder of record entitled to vote thereon [and the purpose
27 shall be included]. The purpose of the meeting shall be stated
28 in the notice [of the meeting].
29 (b) Cross [reference] references.--See Subchapter A of
30 Chapter 17 (relating to notice and meetings generally) and
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1 section 2528 (relating to notice of shareholder meetings).
2 § 1978. Winding up of corporation after dissolution.
3 * * *
4 (b) Standard of care of directors and officers.--The
5 dissolution of the corporation shall not subject its directors
6 or officers to standards of conduct different from those
7 prescribed by or pursuant to Chapter 17 (relating to officers,
8 directors and shareholders). Directors of a dissolved
9 corporation who have complied with section 1975 (relating to
10 predissolution provision for liabilities) or Subchapter H
11 (relating to postdissolution provision for liabilities) and
12 governing persons of a successor entity who have complied with
13 Subchapter H shall not be personally liable to the creditors or
14 claimants of the dissolved corporation.
15 § 2528. Notice of shareholder meetings.
16 If a registered corporation solicits proxies generally with
17 respect to a meeting of its shareholders, the corporation need
18 not give notice of the meeting to any shareholder to whom the
19 corporation is not required to send a proxy statement pursuant
20 to the rules of the Securities and Exchange Commission.
21 § 2529. Voting lists.
22 A registered corporation shall not be required to produce or
23 make available to its shareholders a list of shareholders in
24 connection with any meeting of its shareholders for which a
25 judge or judges of election are appointed, but such a list shall
26 be furnished to the judge or judges of election.
27 § 2545. Notice to shareholders.
28 * * *
29 (b) Obligations of the corporation.--If the controlling
30 person or group so requests, the corporation shall, at the
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1 option of the corporation and at the expense of the person or
2 group, either furnish a list of all such shareholders and their
3 postal addresses to the person or group or [mail] provide the
4 notice to all such shareholders.
5 * * *
6 (e) Cross reference.--See section 1702 (relating to manner
7 of giving notice).
8 § 3133. Notice of meetings of members of mutual insurance
9 companies.
10 (a) General rule.--Unless otherwise restricted in the
11 bylaws, persons authorized or required to give notice of an
12 annual meeting of members of a mutual insurance company for the
13 election of directors or of a meeting of members of a mutual
14 insurance company called for the purpose of considering
15 amendment of the articles or bylaws, or both, of the corporation
16 may, in lieu of any [written] notice of meeting of members
17 required to be given by this subpart, give notice of such
18 meeting by causing notice of such meeting to be officially
19 published. Such notice shall be published each week for at
20 least:
21 (1) Three successive weeks, in the case of an annual
22 meeting.
23 (2) Four successive weeks, in the case of a meeting to
24 consider amendment of the articles or bylaws, or both.
25 (b) Cross reference.--See 1 Pa.C.S. § 1909 (relating to
26 time; publication for successive weeks).
27 § 3135. Proxies of members of mutual insurance companies.
28 In no event shall a proxy given by a member of a mutual
29 insurance company, unless coupled with an interest, be voted on
30 or utilized to express consent or dissent to corporate action
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1 [in writing] after 11 months from the date of execution of the
2 proxy.
3 § 4127. Merger, consolidation or division of qualified foreign
4 corporations.
5 (a) General rule.--Whenever a qualified foreign business
6 corporation is a nonsurviving party to a statutory merger,
7 consolidation or division permitted by the laws of the
8 jurisdiction under which it is incorporated, the corporation or
9 other association surviving the merger, or the new corporation
10 or other association resulting from the consolidation or
11 division, as the case may be, shall file in the Department of
12 State a statement of merger, consolidation or division, which
13 shall be executed by the surviving or new corporation or other
14 association and shall set forth:
15 * * *
16 (5) In the case of a merger, consolidation or division
17 in which any of the new or resulting associations is a
18 corporation, or if the surviving corporation in a merger was
19 a nonqualified foreign business corporation prior to the
20 merger, the statements on the part of the surviving or each
21 new or resulting corporation required by section 4124(a)
22 (relating to application for a certificate of authority).
23 (b) Effect of filing.--The filing of the statement shall
24 operate, as of the effective date of the merger, consolidation
25 or division, to cancel the certificate of authority of each
26 nonsurviving constituent corporation that was a qualified
27 foreign business corporation and to qualify the surviving [or
28 new corporation], new or resulting corporations, if any, under
29 this subchapter. If the surviving [or new corporation does], new
30 or resulting corporations do not desire to continue as [a]
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1 qualified foreign business [corporation, it] corporations, they
2 may thereafter withdraw in the manner provided by section 4129
3 (relating to application for termination of authority).
4 * * *
5 (d) Cross [reference] references.--See [section] sections
6 134 (relating to docketing statement) and 135 (relating to
7 requirements to be met by filed documents).
8 § 5103. Definitions.
9 Subject to additional definitions contained in subsequent
10 provisions of this subpart that are applicable to specific
11 provisions of this subpart, the following words and phrases when
12 used in this subpart shall have the meanings given to them in
13 this section unless the context clearly indicates otherwise:
14 * * *
15 "Amendment." An amendment of the articles.
16 * * *
17 "Board of directors" or "board." The group of persons
18 [vested with the management of] under the direction of whom the
19 business and affairs of the corporation are managed irrespective
20 of the name by which [such] the group is designated in the
21 articles. The term does not include an other body. [The term,
22 when used in any provision of this subpart relating to the
23 organization or procedures of or the manner of taking action by
24 the board of directors, shall be construed to include and refer
25 to any executive or other committee of the board. Any provision
26 of this subpart relating or referring to action to be taken by
27 the board of directors or the procedure required therefor shall
28 be satisfied by the taking of corresponding action by a
29 committee of the board of directors to the extent authority to
30 take such action has been delegated to such committee pursuant
20030S0276B0283 - 19 -
1 to section 5731 (relating to executive and other committees of
2 the board).] See section 5731(c) (relating to status of
3 committee action).
4 * * *
5 "Business corporation." A domestic corporation for profit
6 defined in section 1103 (relating to definitions).
7 "Bylaws." The code or codes of rules adopted for the
8 regulation or management of the business and affairs of the
9 corporation irrespective of the name or names by which [such]
10 the rules are designated. The term includes provisions of the
11 articles as provided by section 5504(c) (relating to bylaw
12 provisions in articles).
13 "Charitable purposes." The relief of poverty, the
14 advancement and provision of education, including without
15 limitation postsecondary education, the advancement of religion,
16 [the promotion of health,] the prevention and treatment of
17 disease or injury, including without limitation mental
18 retardation and mental disorders, governmental or municipal
19 purposes, and any other [purposes] purpose the accomplishment of
20 which is recognized as important and beneficial to the
21 [community] public and which advances social, moral or physical
22 objectives.
23 * * *
24 "Directors." [Persons] Individuals designated, elected or
25 appointed, by that or any other name or title, to act as
26 directors, and their successors. The term does not include a
27 member of an other body, as such. The term, when used in
28 relation to any power or duty requiring collective action, shall
29 be construed to mean "board of directors."
30 * * *
20030S0276B0283 - 20 -
1 "Employee." Does not include members, directors or members
2 of an other body, as such. See section 5730 (relating to
3 compensation of directors) as to acceptance by a director of
4 duties that make him also an employee.
5 * * *
6 "Execute." When used with respect to authenticating a
7 filing, document or other record, means "sign."
8 * * *
9 "Fraternal benefit society." A domestic corporation not-for-
10 profit that is a society as defined in the [act of July 29, 1977
11 (P.L.105, No.38) known as the Fraternal Benefit Society Code]
12 act of December 14, 1992 (P.L.835, No.134), known as the
13 Fraternal Benefit Societies Code.
14 * * *
15 "Member." [One having] A person having one or more
16 membership rights in a corporation in accordance with the
17 provisions of its bylaws. The term, when used in relation to the
18 taking of corporate action, includes:
19 (1) [the] The proxy of a member, if action by proxy is
20 permitted under the bylaws of the corporation[; and].
21 (2) [a] A delegate to any convention or assembly of
22 delegates of members established pursuant to any provision of
23 this subpart.
24 If and to the extent the bylaws confer membership rights [of
25 members] upon holders of [securities evidencing indebtedness]
26 obligations of the corporation or governmental or other entities
27 pursuant to any provision of this subpart or other provision of
28 law, the term shall be construed to include [such security
29 holders] those holders and governmental or other entities. The
30 term shall be construed to include "shareholder" if the
20030S0276B0283 - 21 -
1 corporation issues shares of stock. A person who does not have
2 any membership rights in a corporation is not a member for
3 purposes of this subpart, even though the person may be referred
4 to as a "member" by the corporation.
5 "Membership rights." Any of the following rights with
6 respect to a nonprofit corporation:
7 (1) to vote on the election or removal of directors or
8 members of another body;
9 (2) to vote on approval of an amendment, plan or the
10 dissolution of the corporation; or
11 (3) to receive a distribution from the net assets of the
12 corporation upon its dissolution.
13 "Nonprofit corporation" or "domestic nonprofit corporation."
14 A domestic corporation not-for-profit [which] that is not
15 excluded from the scope of this subpart by section 5102
16 (relating to application of subpart).
17 "Nonqualified foreign corporation" or "nonqualified foreign
18 nonprofit corporation." A foreign corporation not-for-profit
19 [which] that is not a qualified foreign corporation, as defined
20 in this section.
21 "Obligation." Includes a note or other form of indebtedness,
22 whether secured or unsecured.
23 * * *
24 "Officially publish." Publish in two newspapers of general
25 circulation in the English language in the county in which the
26 registered office of the corporation is located or, in the case
27 of a proposed corporation, is to be located, one of which shall
28 be the legal newspaper, if any, designated by the rules of court
29 for the publication of legal notices or, if there is no legal
30 newspaper, in two newspapers of general circulation in the
20030S0276B0283 - 22 -
1 county. When there is but one newspaper of general circulation
2 in any county, advertisement in that newspaper shall be
3 sufficient. Where no other frequency is specified, the notice
4 shall be published one time in the appropriate newspaper or
5 newspapers. See section 109(a)(2) (relating to name of
6 commercial registered office provider in lieu of registered
7 address).
8 "Other body." A term employed in this subpart to denote a
9 person or group, other than the board of directors or a
10 committee thereof, who pursuant to authority expressly conferred
11 by this subpart may be vested by the bylaws of the corporation
12 with powers [which] that, if not vested by the bylaws in [such]
13 the person or group, would by this subpart be required to be
14 exercised by [either]:
15 (1) the [membership of a corporation taken as a whole]
16 members;
17 (2) a convention or assembly of delegates of members
18 established pursuant to any provision of this subpart; or
19 (3) the board of directors.
20 Except as otherwise provided in this subpart, a corporation may
21 establish distinct persons or groups to exercise different
22 powers [which] that this subpart authorizes a corporation to
23 vest in an other body.
24 "Plan." A plan of merger, consolidation, asset transfer,
25 division or conversion.
26 * * *
27 "Record form." Inscribed on a tangible medium or stored in
28 an electronic or other medium and retrievable in tangible and
29 reasonably legible form.
30 "Registered office." That office maintained by a corporation
20030S0276B0283 - 23 -
1 in this Commonwealth, the address of which is filed [in] with
2 the Department of State or which was recorded in the office of
3 the recorder of deeds in the manner formerly required by
4 statute. See section 109 (relating to name of commercial
5 registered office provider in lieu of registered address).
6 * * *
7 "Representative." When used with respect to [a corporation,
8 partnership] an association, joint venture, trust or other
9 enterprise, means a person occupying the position or discharging
10 the functions of a director, member of an other body, officer,
11 employee or agent thereof, regardless of the name or title by
12 which the person may be designated. The term does not imply that
13 a director or member of an other body, as such, is an agent of a
14 corporation.
15 "Sign." Includes:
16 (1) to sign manually or adopt a tangible symbol with the
17 present intent to authenticate a record; or
18 (2) to attach to, or logically associate with, a record
19 or an electronic symbol, sound or process with the present
20 intent to authenticate the record.
21 "Trust instrument." Any lawful deed of gift, grant, will or
22 other document by which the donor, grantor or testator [shall
23 give, grant or devise] gives, grants or devises any real or
24 personal property or the income therefrom in trust for any
25 charitable purpose.
26 "Unless otherwise provided" or "except as otherwise
27 provided." When used to introduce or modify a rule, implies
28 that the alternative provisions contemplated may either relax or
29 restrict the stated rule.
30 "Unless otherwise restricted" or "except as otherwise
20030S0276B0283 - 24 -
1 restricted." When used to introduce or modify a rule, implies
2 that the alternative provisions contemplated may further
3 restrict, but may not relax, the stated rule.
4 "Voting" or "casting a vote." Includes the giving of consent
5 in lieu of voting. The term does not include either recording
6 the fact of abstention or failing to vote for a candidate or for
7 approval or disapproval of a matter, whether or not the person
8 entitled to vote characterizes the conduct as voting or casting
9 a vote.
10 § 5105. [Saving clause and restriction] Restriction on
11 equitable relief.
12 [(a) General rule.--Except as otherwise provided in
13 subsection (b) of this section, this subpart and its amendments
14 shall not impair or affect any act done, offense committed, or
15 substantial right accruing, accrued, or acquired, or liability,
16 duty, obligation, penalty, judgment or punishment incurred prior
17 to the time this subpart or any amendment thereto takes effect,
18 but the same may be enjoyed, asserted, enforced, prosecuted, or
19 inflicted as fully and to the same extent as if this subpart or
20 any amendment thereto had not been enacted.
21 (b) Exception.--] A member of a nonprofit corporation shall
22 not have any right to claim the right to valuation [of] and
23 payment [for] of the fair value of his membership interest or
24 shares because of any proposed plan or amendment [of articles]
25 authorized under any provision of this subpart, or to obtain, in
26 the absence of fraud or fundamental unfairness, an injunction
27 against [any such] the plan or amendment.
28 § 5106. [Limited uniform] Uniform application of subpart.
29 (a) General rule.--Except as provided in subsection (b),
30 this subpart and its amendments are intended to provide uniform
20030S0276B0283 - 25 -
1 rules for the government and regulation of the affairs of
2 nonprofit corporations and of their officers, directors and
3 members, regardless of the date or manner of incorporation or
4 qualification, or of the issuance of any evidences of membership
5 in or shares thereof.
6 (b) Exceptions.--
7 (1) Unless expressly provided otherwise in any amendment
8 to this subpart [any such], the amendment shall take effect
9 only prospectively.
10 (2) Any existing corporation lawfully using a name[,]
11 or, as a part of its name, a word[, which] that could not be
12 used as or included in the name of a corporation [hereafter]
13 subsequently incorporated or qualified under this subpart[,]
14 may continue to use [such] the name[,] or word as part of its
15 name[, provided] if the use or inclusion of [such] the word
16 or name was lawful when first adopted by the corporation in
17 this Commonwealth.
18 (3) [Nothing in subsection] Subsection (a) shall not
19 adversely affect the rights specifically provided for or
20 saved [by the general terms of section 5105 (relating to
21 saving clause and restriction on equitable relief)] in this
22 subpart, including, without limiting the generality of the
23 foregoing, the provisions of section 5952(d) (relating to
24 proposal and adoption of plan of division).
25 § 5107. Subordination of subpart to canon law.
26 If and to the extent canon law applicable to a corporation
27 incorporated for religious purposes shall set forth provisions
28 relating to the government and regulation of the affairs of the
29 corporation [which] that are inconsistent with the provisions of
30 this subpart on the same subject, the provisions of canon law
20030S0276B0283 - 26 -
1 shall control to the extent, and only to the extent, required by
2 the Constitution of the United States or the Constitution of
3 Pennsylvania, or both.
4 § 5108. Limitation on incorporation.
5 [No corporation which might] A corporation that can be
6 incorporated under this subpart shall [hereafter] not be
7 incorporated except under the provisions of this subpart.
8 § 5109. Execution of documents.
9 (a) General rule.--Any document filed in the Department of
10 State under this title by a domestic or foreign nonprofit
11 corporation [or a foreign corporation not-for-profit] subject to
12 this subpart may be executed on behalf of the corporation by any
13 one duly authorized officer thereof. The corporate seal may be
14 affixed and attested, but the affixation or attestation of the
15 corporate seal shall not be necessary for the due execution of
16 any filing by a corporation under this title.
17 (b) Cross reference.--See section 135 (relating to
18 requirements to be met by filed documents).
19 [(c) Transitional provision.--This section supersedes any
20 contrary provision of this subpart enacted prior to the
21 enactment of the act of December 21, 1988 (P.L.1444, No.177),
22 known as the General Association Act of 1988.]
23 § 5302. Number and qualifications of incorporators.
24 One or more corporations for profit or not-for-profit or
25 natural persons of full age may incorporate a nonprofit
26 corporation under the provisions of this [article] subpart.
27 § 5307. Advertisement.
28 The incorporators or the corporation shall officially publish
29 a notice of intention to file or of the filing of articles of
30 incorporation. The notice may appear prior to or after the day
20030S0276B0283 - 27 -
1 the articles of incorporation are filed in the Department of
2 State[,] and shall set forth briefly:
3 (1) The name of the proposed corporation.
4 (2) A statement that the corporation is to be or has
5 been incorporated under the provisions of [this article] the
6 Nonprofit Corporation Law of 1988.
7 [(3) A brief summary of the purpose or purposes of the
8 corporation.
9 (4) A date on or before which the articles will be filed
10 in the Department of State or the date the articles were
11 filed.]
12 § 5308. Filing of articles.
13 (a) General rule.--The articles of incorporation shall be
14 filed in the Department of State.
15 (b) Cross [reference] references.--See [section] sections
16 134 (relating to docketing statement) and 135 (relating to
17 requirements to be met by filed documents).
18 § 5309. Effect of filing of articles of incorporation.
19 (a) Corporate existence.--Upon the filing of the articles of
20 incorporation in the Department of State or upon the effective
21 date specified in the articles of incorporation, whichever is
22 later, the corporate existence shall begin.
23 (b) Evidence of incorporation.--Subject to the provisions of
24 section 503 (relating to actions to revoke corporate
25 franchises), the articles of incorporation filed in the
26 [Department of State, or approved by the court and] department,
27 or recorded in the office of the recorder of deeds under the
28 former provisions of law, shall be conclusive evidence of the
29 fact that the corporation has been incorporated.
30 § 5310. Organization meeting.
20030S0276B0283 - 28 -
1 (a) General rule.--After the [filing of the articles of
2 incorporation] corporate existence begins, an organization
3 meeting of the initial directors[,] or, if directors are not
4 named in the articles, of the incorporator or incorporators[,]
5 shall be held, within or without this Commonwealth, for the
6 purpose of adopting bylaws[,] which they shall have authority to
7 do at [such] the meeting, of electing directors [to hold office
8 as provided in the bylaws], if directors are not named in the
9 articles, and the transaction of such other business as may come
10 before the meeting. A bylaw adopted at [such] the organization
11 meeting of directors or incorporators shall be deemed to be a
12 bylaw adopted by the members for the purposes of this [article]
13 subpart and of any other provision of law.
14 (b) Call of and action at meeting.--The meeting may be held
15 at the call of any director or, if directors are not named in
16 the articles, of any incorporator, who shall give at least five
17 days' [written] notice thereof to each other director or
18 incorporator, which notice shall set forth the time and place of
19 the meeting. For the purposes of this section [an], any
20 incorporator may act in person, by consent or by proxy signed by
21 him or his [attorney in fact] attorney-in-fact.
22 (c) Death or incapacity of directors or incorporators.--If a
23 designated director or an incorporator dies or is for any reason
24 unable to act at the meeting, the other or others may act. If
25 there is no other designated director or incorporator able to
26 act, any person for whom an incorporator was acting as agent may
27 act or appoint another to act in his stead.
28 § 5331. [Unincorporated] Incorporation of unincorporated
29 associations.
30 In the case of the incorporation as a nonprofit corporation
20030S0276B0283 - 29 -
1 under this [article] subpart of an unincorporated association
2 the articles of incorporation shall contain, in addition to the
3 provisions heretofore required in this chapter, a statement that
4 the incorporators constitute a majority of the members of the
5 committee authorized to incorporate [such] the association by
6 the requisite vote required by the organic law of the
7 association for the amendment of such organic law.
8 § 5501. Corporate capacity.
9 Except as provided in section 103 [of this title] (relating
10 to subordination of title to regulatory laws), a nonprofit
11 corporation shall have the legal capacity of natural persons to
12 act.
13 § 5504. Adoption, amendment and contents of bylaws.
14 * * *
15 (b) Exception.--Except as provided in section 5310(a)
16 (relating to organization meeting), the board of directors or
17 other body shall not have the authority to adopt or change a
18 bylaw on any subject that is committed expressly to the members
19 by any of the provisions of this subpart. See:
20 Subsection (d) (relating to amendment of voting
21 provisions).
22 Section 5713 (relating to personal liability of
23 directors).
24 Section 5721 (relating to board of directors).
25 Section 5725(b) (relating to selection of directors).
26 Section 5726(a) (relating to removal of directors by the
27 members).
28 Section 5726(b) (relating to removal of directors by the
29 board).
30 Section 5729 (relating to voting rights of directors).
20030S0276B0283 - 30 -
1 Section 5751(a) (relating to classes and qualifications
2 of membership).
3 Section 5752(c) (relating to rights of shareholders).
4 Section 5754(a) (relating to members grouped in local
5 units).
6 Section 5755(a) (relating to regular meetings).
7 Section 5756 (relating to quorum).
8 Section 5757 (relating to action by members).
9 Section 5758 (relating to voting rights of members).
10 Section 5759(a) (relating to voting and other action by
11 proxy).
12 Section [5760(a)] 5762(a) (relating to voting in
13 nonprofit corporation matters).
14 Section [5762] 5765 (relating to judges of election).
15 Section [5766(a)] 5769(a) (relating to termination and
16 transfer of membership).
17 Section [5767] 5770 (relating to voting powers and other
18 rights of certain security holders and other entities).
19 Section 5975(c) (relating to winding up and
20 distribution).
21 * * *
22 (d) Amendment of voting provisions.--
23 (1) Unless otherwise restricted in a bylaw adopted by
24 the members, whenever the bylaws require for the taking of
25 any action by the members or a class of members a specific
26 number or percentage of votes, the provision of the bylaws
27 setting forth that requirement shall not be amended or
28 repealed by any lesser number or percentage of votes of the
29 members or of the class of members.
30 (2) Paragraph (1) shall not apply to a bylaw setting
20030S0276B0283 - 31 -
1 forth the right of members to act by unanimous written
2 consent as provided in section 5766(a) (relating to unanimous
3 consent).
4 (e) Cross reference.--See section 6145 (relating to
5 applicability of certain safeguards to foreign domiciliary
6 corporations).
7 § 5509. Bylaws and other powers in emergency.
8 (a) General rule.--[The] Except as otherwise restricted in
9 the bylaws, the board of directors or other body of any
10 nonprofit corporation may adopt emergency bylaws, subject to
11 repeal or change by action of the members, which shall,
12 notwithstanding any different provisions of law or of the
13 articles or bylaws, be [operative] effective during any
14 emergency resulting from [warlike damage or] an attack on the
15 United States [or any], a nuclear [or atomic] disaster or
16 another catastrophe as a result of which a quorum of the board
17 cannot readily be assembled. The emergency bylaws may make any
18 provision that may be [practical and necessary] appropriate for
19 the circumstances of the emergency, including [provisions that]:
20 (1) [A meeting of the board of directors or other body
21 may be called by any officer or director or member of such
22 other body in such manner and under such conditions as shall
23 be prescribed in the emergency bylaws.] Procedures for
24 calling meetings of the board or other body.
25 (2) [The director or directors or the member or members
26 of such other body in attendance at the meeting, or any other
27 number fixed in the emergency bylaws, shall constitute a
28 quorum.] Quorum requirements for meetings.
29 (3) [The officers or other persons designated on a list
30 approved by the board of directors or other body before the
20030S0276B0283 - 32 -
1 emergency, all in such order of priority and subject to such
2 conditions and for such period of time, not longer than
3 reasonably necessary after the termination of the emergency
4 as may be provided in the emergency bylaws or in the
5 resolution approving the list, shall, to the extent required
6 to provide a quorum at any meeting of the board of directors
7 or such other body, be deemed directors or members of such
8 other body for such meeting.] Procedures for designating
9 additional or substitute directors or members of an other
10 body.
11 (b) Lines of succession; head office.--The board of
12 directors or [such] other body, either before or during any
13 [such] emergency, may provide, and from time to time modify,
14 lines of succession in the event that during [such an] the
15 emergency any or all officers or agents of the corporation shall
16 for any reason be rendered incapable of discharging their
17 duties[,] and may, effective in the emergency, change the head
18 offices or designate several alternative head offices or
19 regional offices of the corporation[,] or authorize the officers
20 [so] to do so.
21 (c) Personnel not liable.--[No officer, director, member of
22 such other body, or employee acting in accordance with any
23 emergency bylaws shall be liable except for wilful misconduct.]
24 A representative of the corporation:
25 (1) Acting in accordance with any emergency bylaws shall
26 not be liable except for willful misconduct.
27 (2) Shall not be liable for any action taken by him in
28 good faith in an emergency in furtherance of the ordinary
29 business affairs of the corporation even though not
30 authorized by the emergency or other bylaws then in effect.
20030S0276B0283 - 33 -
1 (d) Effect on regular bylaws.--To the extent not
2 inconsistent with any emergency bylaws so adopted, the bylaws of
3 the corporation shall remain in effect during any emergency[,]
4 and, upon its termination, the emergency bylaws shall cease to
5 be [operative] effective.
6 (e) Procedure in absence of emergency bylaws.--Unless
7 otherwise provided in emergency bylaws, notice of any meeting of
8 the board of directors or [such] an other body during [such] an
9 emergency shall be given only to [such of the] those directors
10 or members of [such] an other body [as it may be] it is feasible
11 to reach at the time and by such means as [may be] are feasible
12 at the time, including publication [or], radio or television. To
13 the extent required to constitute a quorum at any meeting of the
14 board of directors or [such] an other body during [such an] any
15 emergency, the officers of the corporation who are present
16 shall, unless otherwise provided in emergency bylaws, be deemed,
17 in order of rank and within the same rank in order of seniority,
18 directors or members of [such] the other body, as the case may
19 be, for [such] the meeting.
20 § 5511. Establishment of subordinate units.
21 A nonprofit corporation may establish and terminate local
22 branches, chapters, councils, clubs, churches, lodges, parishes
23 or other subordinate units regardless of their designation, form
24 of government, incorporated or unincorporated status or
25 relationship to the corporation or other supervising and
26 controlling organization of which the corporation is a member or
27 with which it is in allegiance and to which it is subordinate.
28 § 5541. Capital contributions of members.
29 (a) General rule.--A nonprofit corporation organized on a
30 nonstock basis may provide in its bylaws that members, upon or
20030S0276B0283 - 34 -
1 subsequent to admission, shall make capital contributions. The
2 amount shall be specified in, or fixed by the board of directors
3 or other body pursuant to authority granted by, the bylaws. The
4 requirement of a capital contribution may apply to all members,
5 or to the members of a single class, or to members of different
6 classes in different amounts or proportions.
7 (b) Consideration receivable.--[The capital contribution of
8 a member shall consist of money or other property, tangible or
9 intangible, or labor or services actually received by or
10 performed for the corporation or for its benefit or in its
11 formation or reorganization, or a combination thereof. In the
12 absence of fraud in the transaction, the judgment of the board
13 of directors or other body as to the value of the consideration
14 received by the corporation shall be conclusive.] The capital
15 contribution of a member, unless otherwise provided in the
16 bylaws:
17 (1) May consist of money, obligations (including an
18 obligation of a member), services performed whether or not
19 contracted for, contracts for services to be performed,
20 memberships in or securities or obligations of the
21 corporation, or any other tangible or intangible property or
22 benefit to the corporation. If a capital contribution is made
23 in a form other than money, the value of the contribution
24 shall be determined by or in the manner provided by the board
25 of directors or other body.
26 (2) Shall be provided or paid to or as ordered by the
27 corporation.
28 (c) Evidence of contribution.--The capital contribution of a
29 member shall be recorded on the books of the corporation and may
30 be evidenced by a written instrument delivered to the member,
20030S0276B0283 - 35 -
1 but [such] the instrument shall not be denominated a "share
2 certificate" or by any other word or term implying that the
3 instrument is a share certificate subject to section 5752
4 (relating to organization on a stock share basis).
5 (d) Transferability of interest.--Unless otherwise provided
6 in the bylaws, the capital contribution of a member shall not be
7 transferable.
8 (e) Repayment of contribution.--The capital contribution of
9 a member shall not be repaid by the corporation except upon
10 dissolution of the corporation or as provided in this [article]
11 subpart. A corporation may provide in its bylaws that its
12 capital contributions, or some of them, shall be repayable, in
13 whole or in part, at the option of the corporation only, [at] in
14 such amount or amounts (not to exceed the amount of the capital
15 contribution), within such period or periods[,] and on such
16 terms and conditions, not inconsistent with this [article]
17 subpart, as are stated in, or fixed by the board of directors or
18 other body pursuant to authority granted by, the bylaws.
19 § 5542. Subventions.
20 (a) General rule.--The bylaws of a nonprofit corporation may
21 provide that the corporation shall be authorized by resolution
22 of the board of directors or other body to accept subventions
23 from members or nonmembers on terms and conditions not
24 inconsistent with this [article, and to issue certificates
25 therefor] subpart. The resolution of the board or other body may
26 provide that [holders of] the maker of a subvention
27 [certificates] shall be entitled to a fixed or contingent
28 periodic payment out of the corporate assets equal to a
29 percentage of the original amount or value of the subvention.
30 The rights of [holders of subvention certificates] makers of
20030S0276B0283 - 36 -
1 subventions shall at all times be subordinate to the rights of
2 creditors of the corporation.
3 (b) Consideration receivable.--[A subvention shall consist
4 of money or other property, tangible or intangible, actually
5 received by the corporation or expended for its benefit or in
6 its formation or reorganization, or a combination thereof. In
7 the absence of fraud in the transaction, the judgment of the
8 board of directors or other body as to the value of the
9 consideration received by the corporation shall be conclusive.
10 (c) Form of certificate.--Each subvention certificate shall
11 be signed by two duly authorized officers of the corporation,
12 and may be sealed with the seal of the corporation or a
13 facsimile thereof. The signatures of the officers upon a
14 certificate may be facsimiles if the certificate is
15 countersigned by a transfer agent or registered by a registrar
16 other than the corporation itself or its employees. In case any
17 officer who has signed or whose facsimile signature has been
18 placed upon a certificate shall have ceased to be such officer
19 before such certificate is issued, it may be issued by the
20 corporation with the same effect as if he were such officer at
21 the date of issue. The fact that the corporation is a nonprofit
22 corporation shall be noted conspicuously on the face or back of
23 each certificate.] Consideration for subventions, unless
24 otherwise provided in the bylaws:
25 (1) May consist of money, obligations (including an
26 obligation of a subventor), services performed whether or not
27 contracted for, contracts for services to be performed,
28 memberships in or securities or obligations of the
29 corporation, or any other tangible or intangible property or
30 benefit to the corporation. If subventions are issued for
20030S0276B0283 - 37 -
1 other than money, the value of the consideration shall be
2 determined by or in the manner provided by the board of
3 directors or other body.
4 (2) Shall be provided or paid to or as ordered by the
5 corporation.
6 (c) Form of subventions.--Subventions shall be represented
7 by certificates or shall be uncertificated subventions. Each
8 subvention certificate shall be executed by or on behalf of the
9 corporation issuing the subvention in such manner as it may
10 determine. The fact that the corporation is a nonprofit
11 corporation shall be noted conspicuously on the face or back of
12 each certificate.
13 (d) Transferability of subvention.--[Subvention
14 certificates] Subventions shall be nontransferable unless the
15 resolution of the board of directors or other body [shall
16 provide] provides that they shall be transferable either at will
17 or subject to specified restrictions.
18 (e) Redemption at option of corporation.--The resolution of
19 the board of directors or other body may provide that a
20 subvention shall be redeemable, in whole or in part, at the
21 option of the corporation at such price or prices (not to exceed
22 the original amount or value of the subvention plus any periodic
23 payments due or accrued thereon), within such period or periods,
24 and on such terms and conditions, not inconsistent with this
25 [article] subpart, as are stated in the resolution.
26 (f) Redemption at option of holders.--The resolution of the
27 board of directors or other body may provide that makers or
28 holders of all or some [subvention certificates] subventions
29 shall have the right to require the corporation after a
30 specified period of time to redeem [such certificates] the
20030S0276B0283 - 38 -
1 subventions, in whole or in part, at a price or prices that do
2 not exceed the original amount or value of the subvention plus
3 any periodic payments due or accrued thereon, upon an
4 affirmative showing that the financial condition of the
5 corporation will permit the required payment to be made without
6 impairment of its operations or injury to its creditors. The
7 right to require redemption may in addition be conditioned upon
8 the occurrence of a specified event. For the purpose of
9 enforcing their rights under this subsection, makers or holders
10 of [subvention certificates] subventions shall be entitled to
11 inspect the books and records of the corporation.
12 (g) Rights of makers or holders on dissolution.--[Holders]
13 Makers or holders of [subvention certificates] subventions, upon
14 dissolution of the corporation, shall be entitled, after the
15 claims of creditors have been satisfied, to repayment of the
16 original amount or value of the subvention plus any periodic
17 payments due or accrued thereon, unless a lesser sum is
18 specified in the resolution of the board of directors or other
19 body concerning [such] the subvention.
20 § 5543. Debt and security interests.
21 (a) General rule.--[No corporation shall issue bonds or
22 other evidences of indebtedness except for money or other
23 property, tangible or intangible, or labor or services actually
24 received by or performed for the corporation or for its benefit
25 or in its formation or reorganization, or a combination thereof.
26 In the absence of fraud in the transaction, the judgment of the
27 board of directors or other body as to the value of the
28 consideration received by the corporation shall be conclusive.]
29 Unless otherwise provided in the bylaws, a nonprofit corporation
30 may issue its bonds or other obligations for such amount and
20030S0276B0283 - 39 -
1 form of consideration as may be determined by or in the manner
2 provided by the board of directors or other body.
3 (b) Creation of lien on real or personal property.--The
4 board of directors or other body may authorize any mortgage or
5 pledge of, or the creation of a security interest in, all or any
6 part of the real or personal property of the corporation, or any
7 interest therein. [Unless] No application to or confirmation by
8 a court shall be required and, unless otherwise restricted in
9 the bylaws, no vote or consent of the members shall be required
10 to make effective [such] the action by the board or other body.
11 § 5544. [Fees, dues] Dues and assessments.
12 (a) General rule.--A nonprofit corporation may levy dues or
13 assessments, or both, on its members, if authority to do so is
14 conferred by the bylaws, subject to any limitations therein
15 contained. [Such] The dues or assessments, or both, may be
16 imposed upon all members of the same class either alike or in
17 different amounts or proportions, and upon a different basis
18 upon different classes of members. Members of one or more
19 classes may be made exempt from either dues or assessments, or
20 both, in the manner or to the extent provided in the bylaws.
21 (b) Amount and method of collection.--The amount of the levy
22 and method of collection of [such] the dues or assessments, or
23 both, may be fixed in the bylaws, or the bylaws may authorize
24 the board of directors or other body to fix the amount thereof
25 from time to time, and make them payable at such time and by
26 such methods of collection as the board of directors or other
27 body may prescribe.
28 (c) Enforcement of payment.--A nonprofit corporation may
29 make bylaws necessary to enforce the collection of [such] dues
30 or assessments, including provisions for the termination of
20030S0276B0283 - 40 -
1 membership, upon reasonable notice, for nonpayment of [such]
2 dues or assessments, and for reinstatement of membership.
3 § 5546. Purchase, sale, mortgage and lease of real property.
4 [Except for an industrial development corporation whose
5 articles or bylaws otherwise provide, no purchase of real
6 property shall be made by a nonprofit corporation and no
7 corporation shall sell, mortgage, lease away or otherwise
8 dispose of its real property, unless authorized by the vote of
9 two-thirds of the members in office of the board of directors or
10 other body, except that if there are 21 or more directors or
11 members of such other body, the vote of a majority of the
12 members in office shall be sufficient. No application to or
13 confirmation of any court shall be required and, unless
14 otherwise restricted in the bylaws, no vote or consent of the
15 members shall be required to make effective such action by the
16 board or other body. If the real property is subject to a trust
17 the conveyance away shall be free of trust and the trust shall
18 be impinged upon the proceeds of such conveyance.] Except as
19 otherwise provided in this subpart and unless otherwise provided
20 in the bylaws, no application to or confirmation of any court
21 shall be required for the purchase by or the sale, lease or
22 other disposition of the real or personal property, or any part
23 thereof, of a nonprofit corporation, and, unless otherwise
24 restricted in section 5930 (relating to voluntary transfer of
25 corporate assets) or in the bylaws, no vote or consent of the
26 members shall be required to make effective such action by the
27 board or other body. If the property is subject to a trust, the
28 conveyance away shall be free of trust, and the trust shall be
29 impinged upon the proceeds of the conveyance.
30 § 5550. Devises, bequests and gifts after certain fundamental
20030S0276B0283 - 41 -
1 changes.
2 A devise, bequest or gift to be effective in the future, in
3 trust or otherwise, to or for a nonprofit corporation which has:
4 (1) changed its purposes;
5 (2) sold, leased away or exchanged all or substantially
6 all its property and assets;
7 (3) been converted into a business corporation;
8 (4) become a party to a consolidation or a division;
9 (5) become a party to a merger which it did not survive;
10 or
11 (6) been dissolved;
12 after the execution of the document containing [such] the
13 devise, bequest or gift and before the nonprofit corporation
14 acquires a vested interest in the devise, bequest or gift shall
15 be effective only as a court having jurisdiction over the assets
16 may order under [the Estates Act of 1947] 20 Pa.C.S. Ch. 61
17 (relating to estates) or other applicable provisions of law.
18 § 5551. Dividends prohibited; compensation and certain payments
19 authorized.
20 (a) General rule.--A nonprofit corporation shall not pay
21 dividends or distribute any part of its income or profits to its
22 members, directors, or officers. Nothing herein contained shall
23 prohibit a fraternal benefit society operating under the
24 insurance laws of Pennsylvania from paying dividends or refunds
25 by whatever name known pursuant to the terms of its insurance
26 contracts.
27 (b) Reasonable compensation for services.--A nonprofit
28 corporation may pay compensation in a reasonable amount to
29 members, directors, or officers for services rendered.
30 (c) Certain payments authorized.--A nonprofit corporation
20030S0276B0283 - 42 -
1 may confer benefits upon members or nonmembers in conformity
2 with its purposes, may repay capital contributions, and may
3 redeem its subvention certificates or evidences of indebtedness,
4 as authorized by this article, except when the corporation is
5 currently insolvent or would thereby be made insolvent or
6 rendered unable to carry on its corporate purposes, or when the
7 fair value of the assets of the corporation remaining after such
8 conferring of benefits, payment or redemption would be
9 insufficient to meet its liabilities. A nonprofit corporation
10 may make distributions of cash or property to members upon
11 dissolution or final liquidation as permitted by this article.
12 § 5552. (Reserved).
13 § [5552] 5553. Liabilities of members.
14 * * *
15 § [5553] 5554. Annual report of directors or other body.
16 (a) Contents.--The board of directors or other body of a
17 nonprofit corporation shall present annually to the members a
18 report, verified by the president and treasurer or by a majority
19 of the directors or members of [such] the other body, showing in
20 appropriate detail the following:
21 (1) The assets and liabilities, including [the] trust
22 funds, of the corporation as of the end of the fiscal year
23 immediately preceding the date of the report.
24 (2) The principal changes in assets and liabilities,
25 including trust funds, during the fiscal year immediately
26 preceding the date of the report.
27 (3) The revenue or receipts of the corporation, both
28 unrestricted and restricted to particular purposes, for the
29 fiscal year immediately preceding the date of the report,
30 including separate data with respect to each trust fund held
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1 by or for the corporation.
2 (4) The expenses or disbursements of the corporation,
3 for both general and restricted purposes, during the fiscal
4 year immediately preceding the date of the report, including
5 separate data with respect to each trust fund held by or for
6 the corporation.
7 (5) The number of members of the corporation as of the
8 date of the report, together with a statement of increase or
9 decrease in [such] their number during the year immediately
10 preceding the date of the report, and a statement of the
11 place where the names and addresses of the current members
12 may be found.
13 (b) Place of filing.--The annual report of the board of
14 directors or other body shall be filed with the minutes of the
15 meetings of members.
16 (c) Report in absence of meeting of members.--The board of
17 directors or other body of a corporation having no members shall
18 direct the president and treasurer to present at the annual
19 meeting of the board or [of such] other body a report in
20 accordance with subsection (a) [of this section], but omitting
21 the requirement of paragraph (5) [thereof]. [Such] The report
22 shall be filed with the minutes of the annual meeting of the
23 board or [of such] other body.
24 (d) Cross reference.--See section 6145 (relating to
25 applicability of certain safeguards to foreign domiciliary
26 corporations).
27 § 5585. Establishment or use of common trust funds authorized.
28 (a) General rule.--Every nonprofit corporation may establish
29 and maintain one or more common trust funds, the assets of which
30 shall be held, invested and reinvested by the corporation itself
20030S0276B0283 - 44 -
1 or by a corporate trustee to which the assets have been
2 transferred pursuant to section 5549 (relating to transfer of
3 trust or other assets to institutional trustee). Upon the
4 payment by the corporate trustee to the nonprofit corporation of
5 the net income from [such] the assets, which income may be
6 determined under section 5548(c) (relating to investment of
7 trust funds) if such election is properly made by the board of
8 directors or other body of the corporation, for use and
9 application to the several participating interests in [such] the
10 common trust fund, the proportionate participation of each
11 interest in [such] the net income shall be designated by the
12 corporate trustee. The nonprofit corporation may, at any time,
13 withdraw the whole or part of any participating interest in
14 [such] the common trust fund for distribution by it as provided
15 in this subchapter.
16 (b) Limitations in trust instrument.--Nothing contained in
17 this section shall be construed to authorize the corporation to
18 invest assets of a trust or fund in any [such] common trust fund
19 contrary to any specific limitation or restriction contained in
20 the trust instrument[,] nor to limit or restrict the authority
21 conferred upon the corporation with respect to investments by
22 [any such] the trust instrument.
23 (c) Effect of good faith mistakes.--[No mistakes] Mistakes
24 made in good faith[,] and in the exercise of due care and
25 prudence[,] in connection with the administration of any [such]
26 common trust fund[,] shall not be held to exceed any power
27 granted to or violate any duty imposed upon the corporation[,]
28 if, promptly after the discovery of the mistake, the corporation
29 takes such action as may be practicable under the circumstances
30 to remedy the mistake.
20030S0276B0283 - 45 -
1 § 5586. Restrictions on investments.
2 (a) Legal investments.--If the trust instrument [shall limit
3 or restrict] limits or restricts the investment of [such] the
4 assets to investments of the class authorized by law as legal
5 investments, [the] a nonprofit corporation may invest and
6 reinvest the assets of the trust or fund in any [such] common
7 trust fund maintained by the corporation[, provided] if the
8 investments composing [such] the fund consist solely of
9 investments of the class authorized by [the Fiduciaries
10 Investment Act of 1949] 20 Pa.C.S. Ch. 72 (relating to prudent
11 investor rule) to be held by fiduciaries.
12 (b) Other than legal investments.--If the trust instrument
13 [shall] does not limit or restrict the investment of [such] the
14 assets to investments of the class authorized by law as legal
15 investments, the corporation may invest and reinvest the assets
16 of the trust or fund in any [such] common trust fund maintained
17 by the corporation[,] composed of such investments as in the
18 honest exercise of the judgment of the directors or other body
19 of the corporation they may, after investigation, determine to
20 be safe and proper investments.
21 § 5587. Determination of interests.
22 A nonprofit corporation shall invest the assets of a trust or
23 fund in a common trust fund authorized by this subchapter by
24 adding [such] those assets thereto, and by apportioning a
25 participation therein to [such] the trust or fund in the
26 proportion that the assets of the trust or fund added thereto
27 bears to the aggregate value of all the assets of [such] the
28 common trust fund at the time of [such] the investment,
29 including in [such] those assets the assets of the trust or fund
30 so added. The withdrawal of a participation from [such] the
20030S0276B0283 - 46 -
1 common trust fund shall be on a basis of its proportionate
2 interest in the aggregate value of all the assets of [such] the
3 common trust fund at the time of [such] the withdrawal. The
4 participating interest of any trust or fund in [such] the common
5 trust fund may from time to time be withdrawn, in whole or in
6 part, by the corporation. Upon such withdrawals, the corporation
7 may make distribution in cash, or ratably in kind, or partly in
8 cash and partly in kind. Participations in such common trust
9 funds shall not be sold by the corporation to any other
10 corporation or person, but this sentence shall not prevent a
11 corporate trustee designated under section 5585 (relating to
12 establishment or use of common trust funds authorized) from
13 investing the assets of [such a] the common trust fund in any
14 collective investment fund established and maintained by it in
15 accordance with law and to which the assets comprising [such a]
16 the common trust fund are eligible contributions.
17 § 5588. Amortization of premiums on securities held.
18 If a bond or other obligation for the payment of money is
19 acquired as an investment for any common trust fund at a cost in
20 excess of the par or maturity value thereof, the nonprofit
21 corporation may, during (but not beyond) the period that [such]
22 the obligation is held as an investment in [such] the fund,
23 amortize [such] the excess cost out of the income on [such] the
24 obligation, by deducting from each payment of income and adding
25 to principal an amount equal to the sum obtained by dividing
26 [such] the excess cost by the number of periodic payments of
27 income to accrue on [such] the obligation from the date of
28 [such] the acquisition until its maturity date.
29 § 5589. Records; ownership of assets.
30 The nonprofit corporation shall designate clearly upon its
20030S0276B0283 - 47 -
1 records the names of the trusts or funds on behalf of which
2 [such] the corporation, as fiduciary or otherwise, owns a
3 participation in any common trust fund and the extent of the
4 interest of the trust or fund therein. No such trust or fund
5 shall be deemed to have individual ownership of any asset in
6 [such] the common trust fund, but shall be deemed to have a
7 proportionate undivided interest in the common trust fund. The
8 ownership of the individual assets comprising any common trust
9 fund shall be solely in the nonprofit corporation as fiduciary
10 or otherwise.
11 § 5702. Manner of giving notice.
12 (a) General rule.--[Whenever written]
13 (1) Any notice [is] required to be given to any person
14 under the provisions of this subpart or by the articles or
15 bylaws of any nonprofit corporation[, it may] shall be given
16 to the person either personally or by sending a copy thereof
17 [by]:
18 (i) By first class or express mail, postage prepaid,
19 [or by telegram (with messenger service specified), telex
20 or TWX (with answer back received)] or courier service,
21 charges prepaid, [or by facsimile transmission,] to [his]
22 the person's postal address [(or to his telex, TWX or
23 facsimile number)] appearing on the books of the
24 corporation or, in the case of directors or members of an
25 other body, supplied by [him] the person to the
26 corporation for the purpose of notice. [If the notice is
27 sent by mail, telegraph or courier service, it shall be
28 deemed to have been given to the person entitled thereto
29 when deposited in the United States mail or with a
30 telegraph office or courier service for delivery to that
20030S0276B0283 - 48 -
1 person or, in the case of telex or TWX, when dispatched.]
2 Notice under this subparagraph shall be deemed to have
3 been given to the person entitled thereto when deposited
4 in the United States mail or with a courier service for
5 delivery to that person.
6 (ii) By facsimile transmission, e-mail or other
7 electronic communication to the person's facsimile number
8 or address for e-mail or other electronic communications
9 supplied by the person to the corporation for the purpose
10 of notice. Notice under this subparagraph shall be deemed
11 to have been given to the person entitled thereto when
12 sent.
13 (2) A notice of meeting shall specify the [place,] day
14 [and], hour and geographic location, if any, of the meeting
15 and any other information required by any other provision of
16 this subpart.
17 * * *
18 § 5704. Place and notice of meetings of members.
19 (a) Place.--Meetings of members may be held at such [place]
20 geographic location within or without this Commonwealth as may
21 be provided in or fixed pursuant to the bylaws. Unless otherwise
22 provided in or pursuant to the bylaws, all meetings of the
23 members shall be held [in this Commonwealth at the registered
24 office of the corporation.] at the executive office of the
25 corporation wherever situated. If a meeting of members is held
26 by means of the Internet or other electronic communications
27 technology in a fashion pursuant to which the members have the
28 opportunity to read or hear the proceedings substantially
29 concurrently with their occurrence, vote on matters submitted to
30 the members, pose questions to the directors and members of any
20030S0276B0283 - 49 -
1 other body, make appropriate motions and comment on the business
2 of the meeting, the meeting need not be held at a particular
3 geographic location.
4 (b) Notice.--[Written notice] Notice of every meeting of the
5 members shall be given by, or at the direction of, the secretary
6 or other authorized person to each member of record entitled to
7 vote at the meeting at least:
8 (1) ten days prior to the day named for a meeting that
9 will consider a fundamental change under Chapter 59 (relating
10 to fundamental changes); or
11 (2) five days prior to the day named for the meeting in
12 any other case.
13 If the secretary or other authorized person neglects or refuses
14 to give notice of a meeting, the person or persons calling the
15 meeting may do so.
16 (c) Contents.--In the case of a special meeting of the
17 members, the notice shall specify the general nature of the
18 business to be transacted, and in all cases the notice shall
19 comply with the express requirements of this subpart. The
20 corporation shall not have a duty to augment the notice.
21 § 5705. Waiver of notice.
22 (a) [Written waiver] General rule.--Whenever any [written]
23 notice is required to be given under the provisions of this
24 subpart or the articles or bylaws of any nonprofit corporation,
25 a waiver thereof [in writing, signed] that is filed with the
26 secretary of the corporation in record form signed by the person
27 or persons entitled to the notice, whether before or after the
28 time stated therein, shall be deemed equivalent to the giving of
29 the notice. [Except as otherwise required by this subsection,
30 neither] Neither the business to be transacted at, nor the
20030S0276B0283 - 50 -
1 purpose of, a meeting need be specified in the waiver of notice
2 of the meeting.
3 * * *
4 § 5708. Use of conference telephone [and similar equipment.] or
5 other electronic technology.
6 (a) Incorporators, directors and members of an other body.--
7 Except as otherwise provided in the bylaws, one or more persons
8 may participate in a meeting of the incorporators, the board of
9 directors or an other body[, or the members] of a nonprofit
10 corporation by means of conference telephone or [similar
11 communications equipment] other electronic technology by means
12 of which all persons participating in the meeting can hear each
13 other. Participation in a meeting pursuant to this section shall
14 constitute presence in person at the meeting.
15 (b) Members.--Except as otherwise provided in the bylaws,
16 the presence or participation, including voting and taking other
17 action, at a meeting of members, or the expression of consent or
18 dissent to corporate action, by a member by conference telephone
19 or other electronic means, including, without limitation, the
20 Internet, shall constitute the presence of, or vote or action
21 by, or consent or dissent of the member for the purposes of this
22 subpart.
23 § 5722. Qualifications of directors.
24 Each director of a nonprofit corporation shall be a natural
25 person of full age who, unless otherwise restricted in the
26 bylaws, need not be a resident of this Commonwealth or a member
27 of the corporation. Except as otherwise provided in this
28 section, the qualifications of directors may be prescribed in
29 the bylaws.
30 § 5723. Number of directors.
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1 The board of directors of a nonprofit corporation shall
2 consist of one or more members. [Except as otherwise provided in
3 this section, the] The number of directors shall be fixed by[,]
4 or in the manner provided in[,] the bylaws[; or if]. If not so
5 fixed, the number of directors shall be the same as that stated
6 in the articles or three if no number is so stated.
7 § 5724. Term of office of directors.
8 (a) General rule.--Each director of a nonprofit corporation
9 shall hold office until the expiration of the term for which he
10 was selected and until his successor has been selected and
11 qualified or until his earlier death, resignation or removal.
12 Directors, other than those selected by virtue of their office
13 or former office in the corporation or in any other entity or
14 organization, shall be selected for the term of office provided
15 in the bylaws. In the absence of a provision fixing the term, it
16 shall be one year.
17 (b) Resignations.--Any director may resign at any time upon
18 written notice to the corporation. The resignation shall be
19 effective upon receipt thereof by the corporation or at such
20 subsequent time as shall be specified in the notice of
21 resignation.
22 (c) Decrease in number.--A decrease in the number of
23 directors shall not have the effect of shortening the term of
24 any incumbent director.
25 (d) Classified board of directors.--Except as otherwise
26 provided in the bylaws, if the directors are classified in
27 respect of the time for which they shall severally hold office:
28 (1) Each class shall be as nearly equal in number as
29 possible.
30 (2) The term of office of at least one class shall
20030S0276B0283 - 52 -
1 expire in each year.
2 (3) The members of a class shall not be elected for a
3 longer period than four years.
4 § 5725. Selection of directors.
5 (a) General rule.--Except as otherwise provided in this
6 section, directors of a nonprofit corporation, other than those
7 [named in the articles, if any,] constituting the first board of
8 directors, shall be elected by the members.
9 (b) Other methods.--If a bylaw adopted by the members so
10 provides, directors may be elected, appointed, designated or
11 otherwise selected by such person or persons or by such method
12 or methods as shall be fixed by, or in the manner provided in,
13 [such] the bylaw, and the directors may be classified as to the
14 members who exercise the power to select directors.
15 (c) Vacancies.--Except as otherwise provided in the
16 bylaws[,]:
17 (1) [vacancies] Vacancies in the board of directors,
18 including vacancies resulting from an increase in the number
19 of directors, [shall] may be filled by a majority of the
20 remaining members of the board though less than a quorum, or
21 by a sole remaining director, and each person so [elected]
22 selected shall be a director to serve for the balance of the
23 unexpired term unless otherwise restricted in the bylaws.
24 (2) When one or more directors resign from the board
25 effective at a future date, the directors then in office,
26 including those who have so resigned, shall have power by the
27 applicable vote to fill the vacancies, the vote thereon to
28 take effect when the resignations become effective.
29 (3) In the case of a corporation having a board of
30 directors classified in respect of the time for which
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1 directors shall severally hold office, any director chosen to
2 fill a vacancy, including a vacancy resulting from an
3 increase in the number of directors, shall hold office until
4 the next election of the class for which such director has
5 been chosen and until his successor has been selected and
6 qualified or until his earlier death, resignation or removal.
7 (d) Alternate directors.--If the bylaws so provide, a person
8 or group of persons entitled to elect, appoint, designate or
9 otherwise select one or more directors may select [one or more
10 alternates] an alternate for each [such] director. In the
11 absence of a director from a meeting of the board [one of], his
12 [alternates] alternate may, in the manner and upon such notice,
13 if any, as may be provided in the bylaws, attend [such] the
14 meeting or execute a written consent and exercise at the meeting
15 or in such consent such of the powers of the absent director as
16 may be specified by, or in the manner provided in, the bylaws.
17 When so exercising the powers of the absent director, [such] the
18 alternate shall be subject in all respects to the provisions of
19 this [article] subpart relating to directors.
20 (e) Nomination of directors.--Unless otherwise provided in
21 the bylaws [provide otherwise], directors shall be nominated by
22 a nominating committee or from the floor.
23 (f) Cross references.--See the definition of "member" in
24 section 5103 (relating to definitions) and section 5758(c)
25 (relating to cumulative voting).
26 § 5726. Removal of directors.
27 (a) [By] Removal by the members.--
28 (1) Unless otherwise provided in a bylaw adopted by the
29 members, the entire board of directors, or a class of the
30 board[,] where the board is classified with respect to the
20030S0276B0283 - 54 -
1 power to select directors, or any individual director[,] of a
2 nonprofit corporation may be removed from office without
3 assigning any cause by the vote of members, or a class of
4 members, entitled to [cast at least a majority of the votes
5 which all members present would be entitled to cast at any
6 annual or other regular election of the directors or of such
7 class of directors] elect directors, or the class of
8 directors. In case the board or [such] a class of the board
9 or any one or more directors are so removed, new directors
10 may be elected at the same meeting. [If members are entitled
11 to vote cumulatively for the board or a class of the board,
12 no individual director shall be removed unless the entire
13 board or class of the board is removed in case sufficient
14 votes are cast against the resolution for his removal, which,
15 if cumulatively voted at an annual or other regular election
16 of directors, would be sufficient to elect one or more
17 directors to the board or to the class.]
18 (2) An individual director shall not be removed (unless
19 the entire board or class of the board is removed) from the
20 board of a corporation in which members are entitled to vote
21 cumulatively for the board or a class of the board if
22 sufficient votes are cast against the resolution for his
23 removal which, if cumulatively voted at an annual or other
24 regular election of directors, would be sufficient to elect
25 one or more directors to the board or to the class.
26 (b) [By] Removal by the board.--Unless otherwise provided in
27 a bylaw adopted by the members, the board of directors may
28 declare vacant the office of a director [if he is declared] who
29 has been judicially declared of unsound mind [by an order of
30 court or is convicted of felony] or who has been convicted of an
20030S0276B0283 - 55 -
1 offense punishable by imprisonment for a term of more than one
2 year, or for any other proper cause which the bylaws may
3 specify, or if, within 60 days, or such other time as the bylaws
4 may specify, after notice of his selection, he does not accept
5 [such] the office either in writing or by attending a meeting of
6 the board of directors[,] and fulfill such other requirements of
7 qualification as the bylaws may specify.
8 (c) [By] Removal by the court.--[The court may, upon
9 petition of any member or director, remove from office any
10 director in case of fraudulent or dishonest acts, or gross abuse
11 of authority or discretion with reference to the corporation, or
12 for any other proper cause, and may bar from office any director
13 so removed for a period prescribed by the court. The corporation
14 shall be made a party to such action.] Upon application of any
15 member or director, the court may remove from office any
16 director in case of fraudulent or dishonest acts, or gross abuse
17 of authority or discretion with reference to the corporation, or
18 for any other proper cause, and may bar from office any director
19 so removed for a period prescribed by the court. The corporation
20 shall be made a party to the action and as a prerequisite to the
21 maintenance of an action under this subsection a member shall
22 comply with Subchapter G (relating to judicial supervision of
23 corporate action).
24 (d) Effect of reinstatement.--An act of the board done
25 during the period when a director has been suspended or removed
26 for cause shall not be impugned or invalidated if the suspension
27 or removal is thereafter rescinded by the members or by the
28 board or by the final judgment of a court.
29 § 5727. Quorum of and action by directors.
30 (a) General rule.--Unless otherwise provided in the bylaws,
20030S0276B0283 - 56 -
1 a majority of the directors in office of a nonprofit corporation
2 shall be necessary to constitute a quorum for the transaction of
3 business, and the acts of a majority of the directors present
4 and voting at a meeting at which a quorum is present shall be
5 the acts of the board of directors.
6 (b) Action by [written] consent.--Unless otherwise
7 restricted in the bylaws, any action [which may] required or
8 permitted to be taken at a meeting of the directors may be taken
9 without a meeting[, if] if, prior or subsequent to the action, a
10 consent or consents [in writing setting forth the action so
11 taken shall be signed] thereto in record form signed by all of
12 the directors in office [and shall be] is filed with the
13 secretary of the corporation.
14 § 5728. Interested [members,] directors or officers; quorum.
15 (a) General rule.--[No] A contract or transaction between a
16 nonprofit corporation and one or more of its [members,]
17 directors or officers or between a nonprofit corporation and
18 [any other corporation, partnership, association, or other
19 organization] another domestic or foreign corporation for profit
20 or not-for-profit, partnership, joint venture, trust or other
21 association in which one or more of its directors or officers
22 are directors or officers[,] or have a financial or other
23 interest, shall not be void or voidable solely for [such] that
24 reason, or solely because the [member,] director or officer is
25 present at or participates in the meeting of the board of
26 directors [which] that authorizes the contract or transaction,
27 or solely because his or their votes are counted for [such] that
28 purpose, if:
29 (1) the material facts as to the relationship or
30 interest and as to the contract or transaction are disclosed
20030S0276B0283 - 57 -
1 or are known to the board of directors and the board [in good
2 faith] authorizes the contract or transaction by the
3 affirmative votes of a majority of the disinterested
4 directors even though the disinterested directors are less
5 than a quorum;
6 (2) the material facts as to his relationship or
7 interest and as to the contract or transaction are disclosed
8 or are known to the members entitled to vote thereon, if any,
9 and the contract or transaction is specifically approved in
10 good faith by vote of [such] those members; or
11 (3) the contract or transaction is fair as to the
12 corporation as of the time it is authorized, approved or
13 ratified by the board of directors or the members.
14 (b) Quorum.--Common or interested directors may be counted
15 in determining the presence of a quorum at a meeting of the
16 board [which] that authorizes a contract or transaction
17 specified in subsection (a) [of this section].
18 (c) Applicability.--The provisions of this section shall be
19 applicable except as otherwise restricted in the bylaws.
20 § 5729. Voting rights of directors.
21 (a) General rule.--Unless otherwise provided in a bylaw
22 adopted by the members every director shall be entitled to one
23 vote.
24 (b) Multiple and fractional voting.--The requirement of this
25 article for the presence of or vote or other action by a
26 specified percentage of directors shall be satisfied by the
27 presence of or vote or other action by directors entitled to
28 cast such specified percentage of the votes which all directors
29 are entitled to cast.
30 § 5730. Compensation of directors.
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1 Except as otherwise restricted in the bylaws, the board of
2 directors of a nonprofit corporation shall have the authority to
3 fix the compensation of directors for their services as [such]
4 directors, and a director may be a salaried officer of the
5 corporation.
6 § 5731. Executive and other committees of the board.
7 * * *
8 (c) Status of committee action.--The term "board of
9 directors" or "board," when used in any provision of this
10 subpart relating to the organization or procedures of or the
11 manner of taking action by the board of directors, shall be
12 construed to include and refer to any executive or other
13 committee of the board. Any provision of this subpart relating
14 or referring to action to be taken by the board of directors or
15 the procedure required therefor shall be satisfied by the taking
16 of corresponding action by a committee of the board of directors
17 to the extent authority to take the action has been delegated to
18 the committee under this section.
19 § 5733. Removal of officers and agents.
20 Unless otherwise provided in the bylaws, any officer or agent
21 of a nonprofit corporation may be removed by the board of
22 directors or other body [whenever in its judgment the best
23 interests of the corporation will be served thereby, but such]
24 with or without cause. The removal shall be without prejudice to
25 the contract rights, if any, of any person so removed. Election
26 or appointment of an officer or agent shall not of itself create
27 contract rights.
28 § 5746. Supplementary coverage.
29 (a) General rule.--The indemnification and advancement of
30 expenses provided by or granted pursuant to the other sections
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1 of this subchapter shall not be deemed exclusive of any other
2 rights to which a person seeking indemnification or advancement
3 of expenses may be entitled under any bylaw, agreement, vote of
4 members or disinterested directors or otherwise, both as to
5 action in his official capacity and as to action in another
6 capacity while holding that office. Section 5728 (relating to
7 interested [members,] directors or officers; quorum) shall be
8 applicable to any bylaw, contract or transaction authorized by
9 the directors under this section. A corporation may create a
10 fund of any nature, which may, but need not, be under the
11 control of a trustee, or otherwise secure or insure in any
12 manner its indemnification obligations, whether arising under or
13 pursuant to this section or otherwise.
14 * * *
15 § 5751. Classes and qualifications of membership.
16 (a) General rule.--Membership in a nonprofit corporation
17 shall be of such classes, and shall be governed by such rules of
18 admission, retention, suspension and expulsion, as bylaws
19 adopted by the members shall prescribe, except that [all such]
20 the rules shall be reasonable, germane to the purpose or
21 purposes of the corporation[,] and equally enforced as to all
22 members of the same class. Unless otherwise provided by a bylaw
23 adopted by the members[, there]:
24 (1) There shall be one class of members whose voting and
25 other rights and interests shall be equal.
26 (2) If there is only one class of members, the members
27 shall have all the rights of members generally in a nonprofit
28 corporation.
29 (b) Corporations without voting members.--Where the articles
30 provide that the corporation shall have no members, as such, or
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1 where a nonprofit corporation has under its bylaws or in fact no
2 members entitled to vote on a matter, any provision of this
3 [article] subpart or any other provision of law requiring notice
4 to, the presence of, or the vote, consent or other action by
5 members of the corporation in connection with [such] the matter
6 shall be satisfied by notice to, the presence of, or the vote,
7 consent or other action by the board of directors or other body
8 of the corporation.
9 § 5752. Organization on a stock share basis.
10 (a) General rule.--A nonprofit corporation may be organized
11 upon either a nonstock basis or, if so provided in its articles,
12 upon a stock share basis[, as set forth in its articles].
13 (b) Form of certificates; uncertificated shares.--The shares
14 of nonprofit corporations organized upon a stock share basis
15 shall be of such denominations as the bylaws shall provide and
16 shall be represented by share certificates unless the articles
17 provide that any or all classes and series of shares, or any
18 part thereof, shall be uncertificated shares. A provision of the
19 articles providing for uncertificated shares shall not apply to
20 shares represented by a certificate until the certificate is
21 surrendered to the corporation. Except as otherwise expressly
22 provided by law, the rights and obligations of the holders of
23 shares represented by certificates and the rights and
24 obligations of the holders of uncertificated shares of the same
25 class and series shall be identical. The fact that the
26 corporation is a nonprofit corporation shall be noted
27 conspicuously on the face of each certificate. Within a
28 reasonable time after the issuance or transfer of uncertificated
29 shares, the corporation shall send to the registered owner
30 thereof a written notice stating:
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1 (1) That the corporation is a nonprofit corporation
2 incorporated under the laws of this Commonwealth.
3 (2) The name of the registered owner.
4 (3) The denomination and class of shares and the
5 designation of the series, if any, of the shares issued or
6 transferred.
7 (c) Rights of shareholders.--Unless otherwise provided in a
8 bylaw adopted by the members, each share shall entitle the
9 holder thereof to one vote. No dividends shall be directly or
10 indirectly paid on [any such] the shares, nor shall the
11 shareholders be entitled to any portion of the earnings of
12 [such] the corporation derived through increment of value upon
13 its property, or otherwise incidentally made, until the
14 dissolution of [any such] the corporation.
15 (d) Transferability of shares.--Unless otherwise provided in
16 the bylaws, [such] the shares shall not be transferable by
17 operation of law or otherwise.
18 (e) Power to cancel shares.--A nonprofit corporation shall
19 have power to exclude from further membership any shareholder
20 who fails to comply with the reasonable and lawful bylaws of the
21 corporation, and may cancel the shares of any [such] offending
22 member without liability for an accounting[,] except as may be
23 provided in the bylaws.
24 (f) Applicability of the Uniform Commercial Code.--The
25 provisions of [Division 8 of Title 13] 13 Pa.C.S. Div. 8
26 (relating to investment securities) shall not apply in any
27 manner to the shares of a nonprofit corporation.
28 (g) Cross reference.--See the definition of "member" in
29 section 5103 (relating to definitions).
30 § 5753. Membership certificates.
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1 A nonprofit corporation organized upon a nonstock basis shall
2 not issue shares of stock, but membership in [such] the
3 corporation may be evidenced by certificates of membership. The
4 fact that the corporation is a nonprofit corporation shall be
5 noted conspicuously on the face of each certificate.
6 § 5754. Members grouped in local units.
7 (a) General rule.--The bylaws of a nonprofit corporation may
8 provide that the members of the corporation shall be grouped in
9 incorporated or unincorporated local units formed upon the basis
10 of territorial areas, or such other basis as may be determined
11 in the bylaws, for the purpose of election of delegates or
12 representatives to represent the members of such local units at
13 any regular or special meetings of [such] the corporation.
14 Unless otherwise provided in a bylaw adopted by the members,
15 each local unit participating in a representative capacity by
16 means of one or more delegates or otherwise at a meeting of the
17 corporation shall have a number of votes equal to the total
18 membership of the local unit.
19 (b) Voting at meetings of delegates.--The requirements of
20 this [article] subpart for action by or the consent of a
21 specified number or percentage of the members shall be satisfied
22 by action by or the consent of [such] that number or percentage
23 of votes of delegates or representatives of members selected
24 pursuant to this section.
25 (c) Calling and holding meetings of delegates.--The
26 provisions of this [article] subpart relating to the manner of
27 the calling and holding of and the taking of action at meetings
28 of members shall be applicable to meetings of delegates or
29 representatives of members.
30 (d) Incorporation of local units.--A local unit of an
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1 incorporated or unincorporated parent body [which] that is
2 incorporated or organized for a purpose or purposes not
3 involving pecuniary profit, incidental or otherwise, to its
4 members[,] may be incorporated under this [article] subpart by
5 an incorporated parent body or by the members of [such] the
6 local unit.
7 § 5755. Time of holding meetings of members.
8 (a) Regular meetings.--The bylaws of a nonprofit corporation
9 may provide for the number and the time of meetings of members,
10 but unless otherwise provided in a bylaw adopted by the members
11 at least one meeting of the members of a corporation [which]
12 that has members, as such, entitled to vote, shall be held in
13 each calendar year for the election of directors[,] at such time
14 as shall be provided in or fixed pursuant to authority granted
15 by the bylaws. Failure to hold the annual or other regular
16 meeting at the designated time shall not work a dissolution of
17 the corporation or affect otherwise valid corporate acts. If the
18 annual or other regular meeting [shall not be] is not called and
19 held within six months after the designated time, any member may
20 call [such] the meeting at any time thereafter.
21 (b) Special meetings.--Special meetings of the members may
22 be called at any time by:
23 (1) [by] the board of directors[, or];
24 (2) members entitled to cast at least 10% of the votes
25 [which] that all members are entitled to cast at the
26 particular meeting[, by]; or
27 (3) such other officers or persons as may be provided in
28 the bylaws.
29 At any time, upon written request of any person who has called a
30 special meeting, it shall be the duty of the secretary to fix
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1 the time of the meeting[,] which, if the meeting is called
2 pursuant to a statutory right, shall be held not more than 60
3 days after the receipt of the request. If the secretary [shall
4 neglect or refuse] neglects or refuses to fix the time of the
5 meeting, the person or persons calling the meeting may do so.
6 (c) Adjournments.--Adjournments of any regular or special
7 meeting may be taken[,] but any meeting at which directors are
8 to be elected shall be adjourned only from day to day, or for
9 such longer periods not exceeding 15 days each, as the members
10 present and entitled to [cast at least a majority of the votes
11 which all members present and voting are entitled to cast] vote
12 shall direct, until [such] the directors have been elected.
13 (d) Cross reference.--See section 6145 (relating to
14 applicability of certain safeguards to foreign domiciliary
15 corporations).
16 § 5756. Quorum.
17 (a) General rule.--A meeting of members of a nonprofit
18 corporation duly called shall not be organized for the
19 transaction of business unless a quorum is present. Unless
20 otherwise provided in a bylaw adopted by the members:
21 (1) The presence of members entitled to cast at least a
22 majority of the votes [which] that all members are entitled
23 to cast on [the matters] a particular matter to be acted upon
24 at the meeting shall constitute a quorum for the purposes of
25 consideration and action on the matter.
26 (2) The members present at a duly organized meeting can
27 continue to do business until adjournment, notwithstanding
28 the withdrawal of enough members to leave less than a quorum.
29 (3) If a meeting cannot be organized because a quorum
30 has not attended, those present may, except as otherwise
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1 provided in this [article] subpart, adjourn the meeting to
2 such time and place as they may determine.
3 (b) Exceptions.--Notwithstanding any contrary provision in
4 the articles or bylaws, those members entitled to vote who
5 attend a meeting of members:
6 (1) [In the case of any meeting called for the election
7 of directors those who attend the second of such adjourned
8 meetings] at which directors are to be elected that has been
9 previously adjourned for lack of a quorum, although less than
10 a quorum as fixed in this section[,] or in the [articles or]
11 bylaws, shall nevertheless constitute a quorum for the
12 purpose of election of directors[.];
13 (2) [In the case of any meeting called for any other
14 purpose those who attend the second of such adjourned
15 meetings] that has been previously adjourned for one or more
16 periods aggregating at least 15 days because of an absence of
17 a quorum, although less than a quorum as fixed in this
18 section[,] or in the [articles or] bylaws, shall nevertheless
19 constitute a quorum for the purpose of acting upon any
20 [resolution or other] matter set forth in the notice of the
21 meeting[, if written notice of such second adjourned meeting,
22 stating] if the notice states that those members who attend
23 the adjourned meeting shall nevertheless constitute a quorum
24 for the purpose of acting upon [such resolution or other] the
25 matter[, is given to each member of record entitled to vote
26 at such second adjourned meeting at least ten days prior to
27 the day named for the second adjourned meeting].
28 § 5757. Action by members.
29 (a) General rule.--[Except as otherwise provided in this
30 article or in a bylaw adopted by the members, the acts at a duly
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1 organized meeting of members present entitled to cast at least a
2 majority of the votes which all members present and voting are
3 entitled to cast shall be the acts of the members.
4 (b) Increased minimum vote.--Whenever in this article a
5 specified number or percentage of votes of members or of a class
6 of members is required for the taking of any action, a nonprofit
7 corporation may prescribe in a bylaw adopted by the members that
8 a higher number or percentage of votes shall be required for
9 such action.] Except as otherwise provided in this subpart or in
10 a bylaw adopted by the members, whenever any corporate action is
11 to be taken by vote of the members of a nonprofit corporation,
12 it shall be authorized upon receiving the affirmative vote of a
13 majority of the votes cast by the members entitled to vote
14 thereon and, if any members are entitled to vote thereon as a
15 class, upon receiving the affirmative vote of a majority of the
16 votes cast by the members entitled to vote as a class.
17 (b) Changes in required vote.--Whenever a provision of this
18 subpart requires a specified number or percentage of votes of
19 members or of a class of members for the taking of any action, a
20 nonprofit corporation may prescribe in a bylaw adopted by the
21 members that a higher number or percentage of votes shall be
22 required for the action. The number or percentage of members
23 necessary to call a special meeting of members or to petition
24 for the proposal of an amendment of articles under this subpart
25 may not be increased under this subsection. See sections 5504(d)
26 (relating to amendment of voting provisions) and 5914(e)
27 (relating to amendment of voting provisions).
28 (c) Expenses.--Unless otherwise restricted in the articles,
29 the corporation shall pay the reasonable expenses of
30 solicitation of votes, proxies or consents of members by or on
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1 behalf of the board of directors or its nominees for election to
2 the board, including solicitation by professional proxy
3 solicitors and otherwise, and may pay the reasonable expenses of
4 a solicitation by or on behalf of other persons.
5 § 5758. Voting rights of members.
6 * * *
7 [(e) Voting lists.--Upon request of a member, the books or
8 records of membership shall be produced at any regular or
9 special meeting of the corporation. If at any meeting the right
10 of a person to vote is challenged, the presiding officer shall
11 require the books or records to be produced as evidence of the
12 right of the person challenged to vote, and all persons who
13 appear by the books or records to be members entitled to vote
14 may vote. See section 6145 (relating to applicability of certain
15 safeguards to foreign corporations).]
16 § 5759. Voting and other action by proxy.
17 (a) General rule.--Voting by members of a nonprofit
18 corporation shall be only in person unless a bylaw adopted by
19 the members provides for voting by proxy. [The presence of or
20 vote or other action at a meeting of members, or the expression
21 of consent or dissent to corporate action in writing, by a proxy
22 of a member pursuant to such a bylaw shall constitute the
23 presence of, or vote or action by, or written consent or dissent
24 of such member for the purposes of this article.] Unless
25 otherwise restricted by a bylaw adopted by the members:
26 (1) The presence of, or vote or other action at a
27 meeting of members, or the expression of consent or dissent
28 to corporate action, by a proxy of a member pursuant to a
29 bylaw shall constitute the presence of, or vote or action by,
30 or consent or dissent of the member for the purposes of this
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1 subpart.
2 (2) Where two or more proxies of a member are present,
3 the corporation shall, unless otherwise expressly provided in
4 the proxy, accept as the vote or other action of all the
5 members or shares represented thereby the vote cast or other
6 action taken by a majority of them, and, if a majority of the
7 proxies cannot agree whether the memberships or shares
8 represented shall be voted or upon the manner of voting the
9 memberships or shares or taking the other action, the voting
10 of the memberships or shares or right to take other action
11 shall be divided equally among those persons.
12 (b) [Minimum requirements] Execution and filing.--Every
13 proxy shall be executed [in writing] or authenticated by the
14 member or by his duly authorized [attorney in fact] attorney-in-
15 fact and filed with or transmitted to the secretary of the
16 corporation[.] or its designated agent. A member or his duly
17 authorized attorney-in-fact may execute or authenticate a
18 writing or transmit an electronic message authorizing another
19 person to act for him by proxy. A telegram, telex, cablegram,
20 datagram, e-mail, Internet communication or other means of
21 electronic transmission from a member or attorney-in-fact, or a
22 photographic, facsimile or similar reproduction of a writing
23 executed by a member or attorney-in-fact:
24 (1) may be treated as properly executed or authenticated
25 for purposes of this subsection; and
26 (2) shall be so treated if it sets forth or utilizes a
27 confidential and unique identification number or other mark
28 furnished by the corporation to the member for the purposes
29 of a particular meeting or transaction.
30 (c) Revocation.--A proxy shall be revocable at will,
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1 notwithstanding any other agreement or any provision in the
2 proxy to the contrary, but the revocation of a proxy shall not
3 be effective until notice thereof has been given to the
4 secretary of the corporation[. No] or its designated agent in
5 writing or by electronic transmission. An unrevoked proxy shall
6 not be valid after 11 months from the date of its execution,
7 authentication or transmission unless a longer time is expressly
8 provided therein[, but in no event shall a proxy be voted on
9 after three years from the date of its execution]. A proxy shall
10 not be revoked by the death or incapacity of the maker unless,
11 before the vote is counted or the authority is exercised,
12 [written] notice of [such] the death or incapacity is given to
13 the secretary of the corporation[.] or its designated agent. See
14 section 6145 (relating to applicability of certain safeguards to
15 foreign domiciliary corporations).
16 § 5760. (Reserved).
17 § 5761. (Reserved).
18 § [5760] 5762. Voting by corporations.
19 (a) Voting in nonprofit corporation matters.--Unless
20 otherwise provided in a bylaw of a nonprofit corporation adopted
21 by the members, any other [corporation which is a member of such
22 a nonprofit corporation may vote therein by any of its
23 officers,] domestic or foreign corporation for profit or not-
24 for-profit that is a member of the nonprofit corporation may
25 vote by any of its officers or agents, or by proxy appointed by
26 any officer or agent, unless some other person, by resolution of
27 the board of directors of [such] the other corporation[,] or a
28 provision of its articles or bylaws, a copy of which resolution
29 or provision certified to be correct by one of its officers
30 [shall have] has been filed with the secretary of the nonprofit
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1 corporation, [shall be] is appointed its general or special
2 proxy[,] in which case [such] that person shall be entitled to
3 vote [therein] as such proxy.
4 (b) Voting by nonprofit corporations.--Shares of or
5 memberships in a domestic or foreign corporation for profit or
6 not-for-profit other than a nonprofit corporation, standing in
7 the name of a shareholder or member [which] that is a nonprofit
8 corporation, may be voted by the persons and in the manner
9 provided for in the case of nonprofit corporations by subsection
10 (a) [of this section] unless the laws of the jurisdiction in
11 which the issuer of [any such] the shares or memberships is
12 incorporated [shall] require the shares or memberships to be
13 voted by some other person or persons or in some other manner[,]
14 in which case, to the extent that [such] those laws are
15 inconsistent herewith, this subsection shall not apply.
16 § [5761] 5763. Determination of members of record.
17 (a) Fixing record date.--Unless otherwise restricted in the
18 bylaws, the board of directors of a nonprofit corporation may
19 fix a time[, not more than 70 days] prior to the date of any
20 meeting of members [or any adjournment thereof,] as a record
21 date for the determination of the members entitled to notice of,
22 or to vote at, [such] the meeting[. In such case only], which
23 time, except in the case of an adjourned meeting, shall not be
24 more than 90 days prior to the date of the meeting of members.
25 Only members of record on the date [so] fixed shall [so] be so
26 entitled notwithstanding any increase or other change in
27 membership on the books of the corporation after any record date
28 fixed as [aforesaid] provided in this subsection. Unless
29 otherwise [restricted] provided in the bylaws, the board of
30 directors may similarly fix a record date for the determination
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1 of members of record for any other purpose. When a determination
2 of members of record has been made as provided in this section
3 for purposes of a meeting, the determination shall apply to any
4 adjournment thereof unless otherwise restricted in the bylaws or
5 unless the board fixes a new record date for the adjourned
6 meeting.
7 (b) Determination when no record date fixed.--Unless
8 otherwise [restricted] provided in the bylaws, if [no] a record
9 date is not fixed:
10 (1) The record date for determining members entitled to
11 notice of or to vote at a meeting of members shall be at the
12 close of business on the day next preceding the day on which
13 notice is given, or, if notice is waived, at the close of
14 business on the day [next] immediately preceding the day on
15 which the meeting is held.
16 (2) The record date for determining members entitled to:
17 (i) express consent or dissent to corporate action
18 in writing without a meeting, when [no] prior action by
19 the board of directors or other body is not necessary[,];
20 (ii) call a special meeting of the members; or
21 (iii) propose an amendment of the articles;
22 shall be the close of business on the day on which the first
23 written consent or dissent, request for a special meeting or
24 petition proposing an amendment of the articles is
25 [expressed] filed with the secretary of the corporation.
26 (3) The record date for determining members for any
27 other purpose shall be at the close of business on the day on
28 which the board of directors or other body adopts the
29 resolution relating thereto.
30 § 5764. (Reserved).
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1 § [5762] 5765. Judges of election.
2 (a) General rule.--Unless otherwise provided in a bylaw
3 adopted by the members:
4 (1) In advance of any meeting of members of a nonprofit
5 corporation, the board of directors or other body may appoint
6 judges of election, who need not be members, to act at [such]
7 the meeting or any adjournment thereof. If judges of election
8 are not so appointed, the presiding officer of [any such] the
9 meeting may, and on the request of any member shall, [make
10 such appointment] appoint judges of election at the meeting.
11 The number of judges shall be one or three. [No] A person who
12 is a candidate for office to be filled at the meeting shall
13 not act as a judge.
14 (2) In case any person appointed as judge fails to
15 appear or fails or refuses to act, the vacancy may be filled
16 by appointment made by the board of directors or other body
17 in advance of the convening of the meeting, or at the meeting
18 by the presiding officer thereof.
19 (3) The judges of election shall determine the number of
20 members of record and the voting power of each, the members
21 present at the meeting, the existence of a quorum, the
22 authenticity, validity[,] and effect of proxies, if voting by
23 proxy is permitted under the bylaws, receive votes or
24 ballots, hear and determine all challenges and questions in
25 any way arising in connection with the right to vote, count
26 and tabulate all votes, determine the result[,] and do such
27 acts as may be proper to conduct the election or vote with
28 fairness to all members. The judges of election shall perform
29 their duties impartially, in good faith, to the best of their
30 ability[,] and as expeditiously as is practical. If there are
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1 three judges of election, the decision, act or certificate of
2 a majority shall be effective in all respects as the
3 decision, act or certificate of all.
4 (4) On request of the presiding officer of the meeting,
5 or of any member, the judges shall make a report in writing
6 of any challenge or question or matter determined by them,
7 and execute a certificate of any fact found by them. Any
8 report or certificate made by them shall be prima facie
9 evidence of the facts stated therein.
10 (b) Cross reference.--See section 6145 (relating to
11 applicability of certain safeguards to foreign domiciliary
12 corporations).
13 § [5763] 5766. Consent of members in lieu of meeting.
14 (a) Unanimous consent.--Unless otherwise restricted in the
15 bylaws, any action [which may] required or permitted to be taken
16 at a meeting of the members or of a class of members of a
17 nonprofit corporation may be taken without a meeting[,] if,
18 prior or subsequent to the action, a consent or consents [in
19 writing, setting forth the action so taken, shall be signed]
20 thereto signed by all of the members who would be entitled to
21 vote at a meeting for such purpose [and] shall be filed in
22 record form with the secretary of the corporation.
23 (b) Partial consent.--If the bylaws so provide, any action
24 required or permitted to be taken at a meeting of the members or
25 of a class of members may be taken without a meeting upon the
26 signed consent of members who would have been entitled to cast
27 the minimum number of votes that would be necessary to authorize
28 the action at a meeting at which all members entitled to vote
29 thereon were present and voting. The consents shall be filed
30 with the secretary of the corporation.
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1 (c) Effectiveness of action by partial consent.--An action
2 taken pursuant to subsection (b) shall not become effective
3 until after at least ten days' notice of the action has been
4 given to each member entitled to vote thereon who has not
5 consented thereto.
6 § [5764] 5767. Appointment of custodian of corporation on
7 deadlock or other cause.
8 (a) General rule.--[The court, upon] Upon application of any
9 member, the court may appoint one or more persons to be
10 custodians of and for any nonprofit corporation when it is made
11 to appear that:
12 (1) [that] at any meeting for the election of directors
13 or members of an other body, the members are so divided that
14 they have failed to elect successors to [directors] those
15 whose terms have expired or would have expired upon the
16 qualification of their successors; or
17 (2) [that] any of the conditions specified in section
18 5981 (relating to proceedings upon [petition of member, etc.)
19 exists] application of member or director), other than it is
20 beneficial to the interest of the members that the
21 corporation be wound up and dissolved, exist with respect to
22 the corporation.
23 (b) Exception.--The court shall not appoint a custodian to
24 resolve a deadlock if the members by agreement or otherwise have
25 provided for the appointment of a provisional director or member
26 of an other body or other means for the resolution of the
27 deadlock, but the court shall enforce the remedy so provided if
28 appropriate.
29 [(b)] (c) Power and title of custodian.--A custodian
30 appointed under this section shall have all the power and title
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1 of a receiver appointed under Subchapter G of Chapter 59
2 (relating to involuntary liquidation and dissolution), but the
3 authority of the custodian shall be to continue the business of
4 the corporation and not to liquidate its affairs and distribute
5 its assets[,] except when the court shall otherwise order [and
6 except in cases arising under section 5981(1), (2) and (3)
7 (relating to proceedings upon petition of member, etc.)].
8 (d) Cross reference.--See section 6145 (relating to
9 applicability of certain safeguards to foreign domiciliary
10 corporations).
11 § [5765] 5768. Reduction of membership below stated number.
12 Whenever the membership of a nonprofit corporation having a
13 stated number of members [shall be] is reduced below [such] that
14 number by death, withdrawal[,] or otherwise, the corporation
15 shall not on that account be dissolved, but it shall be lawful
16 for the surviving or continuing members to continue the
17 corporate existence[,] unless otherwise restricted in the
18 bylaws.
19 § [5766] 5769. Termination and transfer of membership.
20 (a) General rule.--Membership in a nonprofit corporation
21 shall be terminated in the manner provided in a bylaw adopted by
22 the members. If [the] membership in any such corporation is
23 limited to persons who are members in good standing in another
24 corporation, or in any lodge, church, club, society or other
25 entity or organization, the bylaws shall in each case define
26 [such] the limitations, and may provide that failure on the part
27 of [any such] a member to keep himself in good standing in
28 [such] the other entity or organization shall be sufficient
29 cause for [expelling the member from] terminating the membership
30 of the member in the corporation requiring such eligibility.
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1 (b) Expulsion.--
2 (1) [No] A member shall not be expelled from any
3 nonprofit corporation without notice, trial and conviction,
4 the form of which shall be prescribed by the bylaws.
5 (2) Paragraph (1) [of this subsection] shall not apply
6 to termination of membership pursuant to section 5544[(c)]
7 (relating to [enforcement of payment of fees,] dues and
8 assessments).
9 (3) See section 6145 (relating to applicability of
10 certain safeguards to foreign domiciliary corporations).
11 (c) Effect of termination of membership.--Unless otherwise
12 provided in the bylaws, the right of a member of a nonprofit
13 corporation to vote, and his right, title and interest in or to
14 the corporation or its property, shall cease on the termination
15 of his membership.
16 (d) Transfer of membership.--Unless otherwise provided in
17 the bylaws, [no] a member may not transfer his membership or any
18 right arising therefrom. The adoption of an amendment to the
19 articles or bylaws of a nonprofit corporation that changes the
20 identity of some or all of the members or the criteria for
21 membership does not constitute a transfer for purposes of this
22 subsection.
23 § [5767] 5770. Voting powers and other rights of certain
24 securityholders and other entities.
25 [Such] The power to vote in respect to the corporate affairs
26 and management of a nonprofit corporation and other membership
27 rights as may be provided in a bylaw adopted by the members may
28 be conferred upon:
29 (1) Registered holders of [securities evidencing
30 indebtedness] obligations issued or to be issued by the
20030S0276B0283 - 77 -
1 corporation.
2 (2) The United States of America, the Commonwealth, a
3 state, or any political subdivision [thereof or other] of any
4 of the foregoing, or any entity prohibited by law from
5 becoming a member of a corporation.
6 § 5791. Corporate action subject to subchapter.
7 (a) General rule.--This subchapter shall apply to, and the
8 term "corporate action" in this subchapter shall mean any of the
9 following actions:
10 (1) The election, appointment, designation or other
11 selection and the suspension, removal or expulsion of
12 members, directors, members of an other body or officers of a
13 nonprofit corporation.
14 (2) The taking of any action on any matter [which] that
15 is required under this [article] subpart or under any other
16 provision of law to be, or [which] that under the bylaws may
17 be, submitted for action to the members, directors, members
18 of an other body or officers of a nonprofit corporation.
19 (b) Cross reference.--See section 6145 (relating to
20 applicability of certain safeguards to foreign domiciliary
21 corporations).
22 § 5792. Proceedings prior to corporate action.
23 (a) General rule.--Where under applicable law or the bylaws
24 of a nonprofit corporation there has been a failure to hold a
25 meeting to take corporate action and [such] the failure has
26 continued for 30 days after the date designated or appropriate
27 therefor, the court may summarily order a meeting to be held
28 upon the application of any person entitled, either alone or in
29 conjunction with other persons similarly seeking relief under
30 this section, to call a meeting to consider the corporate action
20030S0276B0283 - 78 -
1 in issue.
2 (b) Conduct of meeting.--The court may determine the right
3 to vote at [such] the meeting of persons claiming [such] that
4 right, may appoint a master to hold [such] the meeting under
5 such orders and powers as the court [may deem proper,] deems
6 proper and may take such action as may be required to give due
7 notice of the meeting and to convene and conduct the meeting in
8 the interests of justice.
9 (c) Cross reference.--See section 6145 (relating to
10 applicability of certain safeguards to foreign domiciliary
11 corporations).
12 § 5793. Review of contested corporate action.
13 (a) General rule.--Upon [petition] application of any person
14 [whose status as, or whose rights or duties as, a member,
15 director, member of an other body, officer or otherwise of a
16 nonprofit corporation are or may be affected] aggrieved by any
17 corporate action, the court may hear and determine the validity
18 of [such] the corporate action.
19 (b) Powers and procedures.--The court may make such orders
20 in any such case as may be just and proper, with power to
21 enforce the production of any books, papers and records of the
22 corporation and other relevant evidence [which] that may relate
23 to the issue. The court shall provide for notice of the pendency
24 of the proceedings under this section to all persons affected
25 thereby. If it is determined that no valid corporate action has
26 been taken, the court may order a meeting to be held in
27 accordance with section 5792 (relating to proceedings prior to
28 corporate action).
29 (c) Cross reference.--See section 6145 (relating to
30 applicability of certain safeguards to foreign domiciliary
20030S0276B0283 - 79 -
1 corporations).
2 § 5911. Amendment of articles authorized.
3 (a) General rule.--A nonprofit corporation, in the manner
4 [hereinafter] provided in this subchapter, may from time to time
5 amend its articles for one or more of the following purposes:
6 (1) To adopt a new name, subject to the restrictions
7 [heretofore] provided in this [article] subpart.
8 (2) To modify any provision of the articles relating to
9 its term of existence.
10 (3) To change, add to[,] or diminish its purposes[,] or
11 to set forth different or additional purposes.
12 (4) To restate the articles in their entirety.
13 (5) In any and as many other respects as desired.
14 (b) Exceptions.--[No] An amendment adopted under this
15 section shall not amend articles in such a way that as so
16 amended they would not be authorized by this [article] subpart
17 as original articles of incorporation[,] except that:
18 (1) Restated articles shall, subject to section 109
19 (relating to name of commercial registered office provider in
20 lieu of registered address), state the address of the current
21 instead of the initial registered office of the corporation
22 in this Commonwealth[,] and need not state the names and
23 addresses [of the first directors or] of the incorporators.
24 (2) The corporation shall not be required to revise any
25 other provision of its articles if [such] the provision is
26 valid and operative immediately prior to the filing of [such]
27 the amendment in the Department of State.
28 § 5913. Notice of meeting of members.
29 [Written notice shall, not less than ten days before the
30 meeting of members called for the purpose of considering the
20030S0276B0283 - 80 -
1 proposed amendment,] (a) General rule.--Notice of the meeting
2 of members of a nonprofit corporation that will act on the
3 proposed amendment shall be given to each member of record
4 entitled to vote thereon. [There shall be included in, or
5 enclosed with, such notice] The notice shall include a copy of
6 the proposed amendment or a summary of the changes to be
7 effected thereby.
8 (b) Cross reference.--See Subchapter A of Chapter 57
9 (relating to notice and meetings generally).
10 § 5914. Adoption of amendments.
11 (a) General rule.--[The] Unless a bylaw adopted by the
12 members or a specific provision of this subpart requires a
13 greater vote, a proposed amendment of the articles of a
14 nonprofit corporation shall be adopted upon receiving the
15 affirmative vote of the members present entitled to cast at
16 least a majority of the votes [which] that all members present
17 are entitled to cast thereon, and if any class of members is
18 entitled to vote thereon as a class, the affirmative vote of the
19 members present of such class entitled to cast at least a
20 majority of the votes [which] that all members present of such
21 class are entitled to cast thereon. Any number of amendments may
22 be submitted to the members and voted upon by them at one
23 meeting.
24 (b) Adoption by board of directors or other body.--Unless
25 otherwise restricted in the bylaws, an amendment of articles
26 shall not require the approval of the members of the corporation
27 if:
28 (1) the amendment is to provide for perpetual existence;
29 (2) to the extent the amendment has not been approved by
30 the members, it restates without change all of the operative
20030S0276B0283 - 81 -
1 provisions of the articles as theretofore amended or as
2 amended thereby; or
3 (3) the amendment accomplishes any combination of
4 purposes specified in this subsection.
5 Whenever a provision of this subpart authorizes the board of
6 directors or other body to take any action without the approval
7 of the members and provides that a statement, certificate, plan
8 or other document relating to such action shall be filed in the
9 Department of State and shall operate as an amendment of the
10 articles, the board upon taking such action may, in lieu of
11 filing the statement, certificate, plan or other document, amend
12 the articles under this subsection without the approval of the
13 members to reflect the taking of such action. The amendment of
14 articles shall be deemed adopted by the corporation when it has
15 been adopted by the board of directors or other body in the
16 manner provided by subsection (c).
17 [(b)] (c) Adoption in absence of voting members.--If the
18 corporation has no members entitled to vote thereon, or no
19 members entitled to vote thereon other than persons who also
20 constitute the board of directors or other body, the amendment
21 shall be deemed adopted by the corporation when it has been
22 adopted by the board of directors or other body pursuant to
23 section 5912 [(relating to proposal of amendments)].
24 [(c)] (d) Termination of proposal.--[The resolution or
25 petition may contain a provision that at any time prior to the
26 filing of articles of amendment in the Department of State the
27 proposal may be terminated by the board of directors or other
28 body notwithstanding the adoption of the amendment by the
29 corporation.] Prior to the time when an amendment becomes
30 effective, the amendment may be terminated pursuant to
20030S0276B0283 - 82 -
1 provisions therefor, if any, set forth in the resolution or
2 petition. If articles of amendment have been filed in the
3 department prior to the termination, a statement under section
4 5902 (relating to statement of termination) shall be filed in
5 the department.
6 [(d)] (e) Amendment of voting provisions.--[Notwithstanding
7 any contrary provision of the articles or bylaws,] Unless
8 otherwise provided in the articles, whenever the articles
9 [shall] require for the taking of any action by the members or a
10 class of members a specific number or percentage of votes, the
11 provision of the articles setting forth [such] that requirement
12 shall not be amended or repealed by any lesser number or
13 percentage of votes of the members or of [such] the class of
14 members.
15 § 5921. Merger and consolidation authorized.
16 (a) Domestic surviving or new corporation.--Any two or more
17 domestic nonprofit corporations, or any two or more foreign
18 nonprofit corporations [not-for-profit], or any one or more
19 domestic nonprofit corporations[,] and any one or more foreign
20 nonprofit corporations [not-for-profit], may, in the manner
21 provided in this subchapter, be merged into one of [such] the
22 domestic nonprofit corporations, [hereinafter] designated in
23 this subchapter as the surviving corporation, or consolidated
24 into a new corporation to be formed under this [article]
25 subpart, if [such] the foreign corporations [not-for-profit] are
26 authorized by the [law or] laws of the jurisdiction under which
27 they are incorporated to effect [such] a merger or consolidation
28 with a corporation of another jurisdiction.
29 (b) Foreign surviving or new corporation.--Any one or more
30 domestic nonprofit corporations, and any one or more foreign
20030S0276B0283 - 83 -
1 nonprofit corporations [not-for-profit], may, in the manner
2 [hereinafter] provided in this subchapter, be merged into one of
3 [such foreign corporations not-for-profit, hereinafter] the
4 foreign nonprofit corporations, designated in this subchapter as
5 the surviving corporation, or consolidated into a new
6 corporation to be incorporated under the [law or] laws of the
7 jurisdiction under which one of the foreign nonprofit
8 corporations [not-for-profit] is incorporated, if the laws of
9 [such] that jurisdiction authorize [such] a merger with or
10 consolidation into a corporation of another jurisdiction.
11 § 5923. Notice of meeting of members.
12 (a) General rule.--[Written notice] Notice of the meeting of
13 members that will act on the proposed plan shall be given to
14 each member of record, whether or not entitled to vote thereon,
15 of each domestic nonprofit corporation that is a party to the
16 merger or consolidation. [There shall be included in, or
17 enclosed with, the notice] The notice shall include a copy of
18 the proposed plan or a summary thereof. The notice shall [state]
19 provide that a copy of the bylaws of the surviving or new
20 corporation will be furnished to any member on request and
21 without cost.
22 * * *
23 § 5924. Adoption of plan.
24 (a) General rule.--The plan of merger or consolidation shall
25 be adopted upon receiving the affirmative vote of the members
26 present entitled to cast at least a majority of the votes
27 [which] that all members present are entitled to cast thereon of
28 each of the [merging or consolidating] domestic nonprofit
29 corporations[,] that is a party to the merger or consolidation
30 and, if any class of members is entitled to vote thereon as a
20030S0276B0283 - 84 -
1 class, the affirmative vote of the members present of such class
2 entitled to cast at least a majority of the votes [which] that
3 all members present of such class are entitled to cast thereon.
4 (b) Adoption in absence of voting members.--If [the] a
5 merging or consolidating corporation has no members entitled to
6 vote thereon, or no members entitled to vote thereon other than
7 persons who also constitute the board of directors or other
8 body, a plan of merger or consolidation shall be deemed adopted
9 by the corporation when it has been adopted by the board of
10 directors or other body pursuant to section 5922 [(relating to
11 plan of merger or consolidation)].
12 (c) Termination of plan.--[Any plan of merger or
13 consolidation may contain a provision that at any time prior to
14 the filing of articles of merger or consolidation in the
15 Department of State the plan may be terminated by the board of
16 directors or other body of any corporation which is a party to
17 the plan notwithstanding adoption of the plan by all or any of
18 the corporations which are parties to the plan.] Prior to the
19 time when a merger or consolidation becomes effective, the
20 merger or consolidation may be terminated pursuant to provisions
21 therefor, if any, set forth in the plan. If articles of merger
22 or consolidation have been filed in the Department of State
23 prior to the termination, a statement under section 5902
24 (relating to statement of termination) shall be filed in the
25 department.
26 § 5925. Authorization by foreign corporations.
27 The plan of merger or consolidation shall be authorized,
28 adopted or approved by each foreign nonprofit corporation
29 [which] that desires to merge or consolidate[,] in accordance
30 with the laws of the jurisdiction in which it is incorporated
20030S0276B0283 - 85 -
1 and, in the case of a foreign domiciliary corporation, the
2 provisions of this subpart to the extent provided by section
3 6145 (relating to applicability of certain safeguards to foreign
4 domiciliary corporations).
5 § 5926. Articles of merger or consolidation.
6 Upon the adoption of the plan of merger or consolidation by
7 the corporations desiring to merge or consolidate, as provided
8 in this subchapter, articles of merger or articles of
9 consolidation, as the case may be, shall be executed by each
10 corporation and shall, subject to section 109 (relating to name
11 of commercial registered office provider in lieu of registered
12 address), set forth:
13 * * *
14 (2) The name and address, including street and number,
15 if any, of the registered office of each other domestic
16 nonprofit corporation and qualified foreign nonprofit
17 corporation that is a party to the [plan] merger or
18 consolidation.
19 * * *
20 (4) The manner in which the plan was adopted by each
21 domestic corporation and, if one or more foreign corporations
22 are parties to the [plan] merger or consolidation, the fact
23 that the plan was authorized, adopted or approved, as the
24 case may be, by each of the foreign corporations in
25 accordance with the laws of the jurisdiction in which it is
26 incorporated.
27 * * *
28 § 5928. Effective date of merger or consolidation.
29 Upon the filing of the articles of merger or the articles of
30 consolidation in the Department of State[,] or upon the
20030S0276B0283 - 86 -
1 effective date specified in the plan of merger or consolidation,
2 whichever is later, the merger or consolidation shall be
3 effective. The merger or consolidation of one or more domestic
4 nonprofit corporations into a foreign nonprofit corporation
5 shall be effective according to the provisions of law of the
6 jurisdiction in which [such] the foreign corporation is
7 incorporated, but not until articles of merger or articles of
8 consolidation have been adopted and filed, as provided in this
9 subchapter.
10 § 5930. Voluntary transfer of corporate assets.
11 (a) General rule.--[A nonprofit corporation shall not sell,
12 lease away or exchange all, or substantially all, its property
13 and assets, with or without good will, unless and until a plan
14 of sale, lease or exchange of assets with respect thereto shall
15 have been adopted by the corporation in the manner provided in
16 this subchapter with respect to the adoption of a plan of
17 merger.] A sale, lease, exchange or other disposition of all, or
18 substantially all, the property and assets, with or without
19 goodwill, of a nonprofit corporation, if not made pursuant to
20 Subchapter D (relating to division), may be made only pursuant
21 to a plan of asset transfer. The property or assets of a direct
22 or indirect subsidiary corporation that is controlled by a
23 parent corporation shall also be deemed the property or assets
24 of the parent corporation for the purposes of this subsection.
25 The plan of asset transfer shall set forth the terms and
26 consideration of the sale, lease, exchange or other disposition
27 or may authorize the board of directors or other body to fix any
28 or all of the terms and conditions, including the consideration
29 to be received by the corporation therefor. Any of the terms of
30 the plan may be made dependent upon facts ascertainable outside
20030S0276B0283 - 87 -
1 of the plan if the manner in which the facts will operate upon
2 the terms of the plan is set forth in the plan. The plan of
3 asset transfer shall be proposed and adopted, and may be amended
4 after its adoption and terminated, by a nonprofit corporation in
5 the manner provided in this subchapter for the proposal,
6 adoption, amendment and termination of a plan of merger. There
7 shall be included in, or enclosed with, the notice of the
8 meeting of members to act on the plan a copy or summary of the
9 plan. In order to make effective any plan [of sale, lease or
10 exchange of assets] so adopted, it shall not be necessary to
11 file any articles or other document in the Department of State,
12 but the corporation shall comply with the requirements of
13 section [5547(b)] 5547(c) (relating to nondiversion of certain
14 property).
15 (b) Exceptions.--Subsection (a) [of this section] shall not
16 apply to a sale, lease [away or], exchange or other disposition
17 of all, or substantially all, the property and assets of a
18 nonprofit corporation [when made in connection with the
19 dissolution or liquidation of the corporation. Such a
20 transaction shall be governed by the provisions of Subchapter F
21 (relating to voluntary dissolution and winding up) or Subchapter
22 G (relating to involuntary liquidation and dissolution), as the
23 case may be.]:
24 (1) that directly or indirectly owns all of the
25 outstanding shares or other ownership interest of another
26 corporation to the other corporation;
27 (2) when made in connection with the dissolution or
28 liquidation of the corporation, which transaction shall be
29 governed by the provisions of Subchapter F (relating to
30 voluntary dissolution and winding up) or G (relating to
20030S0276B0283 - 88 -
1 involuntary liquidation and dissolution), as the case may be;
2 or
3 (3) when made in connection with a transaction pursuant
4 to which all the assets sold, leased, exchanged or otherwise
5 disposed of are simultaneously leased back to the
6 corporation.
7 (c) Mortgage.--A mortgage [or], pledge or grant of a
8 security interest or dedication of property to the repayment of
9 indebtedness, with or without recourse, shall not be deemed a
10 sale, lease [or], exchange or other disposition for the purposes
11 of this section.
12 (d) Restrictions.--[Nothing in this] This section shall not
13 be construed to authorize the conversion or exchange of property
14 or assets in fraud of corporate creditors or in violation of
15 law.
16 § 5951. Division authorized.
17 (a) Division of domestic corporation.--Any domestic
18 nonprofit corporation may, in the manner provided in this
19 subchapter, be divided into two or more domestic nonprofit
20 corporations incorporated or to be incorporated under this
21 article, or into one or more [such] domestic nonprofit
22 corporations and one or more foreign nonprofit corporations
23 [not-for-profit] to be incorporated under the laws of another
24 jurisdiction or jurisdictions, or into two or more [of such]
25 foreign nonprofit corporations [not-for-profit], if the [law or]
26 laws of [such] the other jurisdictions [authorized such]
27 authorize the division.
28 (b) Division of foreign corporation.--Any foreign nonprofit
29 corporation [not-for-profit] may, in the manner provided in this
30 subchapter, be divided into one or more domestic nonprofit
20030S0276B0283 - 89 -
1 corporations to be incorporated under this [article] subpart and
2 one or more foreign nonprofit corporations [not-for-profit]
3 incorporated or to be incorporated under the laws of another
4 jurisdiction or jurisdictions, or into two or more [of such]
5 domestic nonprofit corporations, if such foreign nonprofit
6 corporation [not-for-profit] is authorized under the laws of the
7 jurisdiction under which it is incorporated to effect [such] a
8 division.
9 (c) Surviving and new corporations.--The corporation
10 effecting a division, if it [shall survive] survives the
11 division, is [hereinafter] designated in this subchapter as the
12 surviving corporation. All corporations originally incorporated
13 by a division are [hereinafter] designated in this subchapter as
14 new corporations. The surviving corporation, if any, and the new
15 corporation or corporations are [hereinafter] collectively
16 designated in this subchapter as the resulting corporations.
17 § 5956. Effective date of division.
18 Upon the filing of articles of division in the Department of
19 State[,] or upon the effective date specified in the plan of
20 division, whichever is later, the division shall become
21 effective. The division of a domestic nonprofit corporation into
22 one or more foreign nonprofit corporations [not-for-profit] or
23 the division of a foreign nonprofit corporation [not-for-profit]
24 shall be effective according to the laws of the jurisdictions
25 where [such] the foreign corporations are or are to be
26 incorporated and, in the case of a foreign domiciliary
27 corporation, the provisions of this subpart to the extent
28 provided by section 6145 (relating to applicability of certain
29 safeguards to foreign domiciliary corporations), but not until
30 articles of division have been adopted and filed[,] as provided
20030S0276B0283 - 90 -
1 in this subchapter.
2 § 5957. Effect of division.
3 * * *
4 (b) Property rights; allocations of assets and
5 liabilities.--
6 (1) Except as otherwise provided by order, if any,
7 obtained pursuant to section 5547(b) (relating to
8 nondiversion of certain property):
9 (i) All the property, real, personal and mixed, and
10 franchises of the dividing corporation, and all debts due
11 on whatever account to it, including subscriptions for
12 membership and other choses in action belonging to it,
13 shall, to the extent allocations of assets are
14 contemplated by the plan of division, be deemed without
15 further action to be allocated to and vested in the
16 resulting corporations on such a manner and basis and
17 with such effect as is specified in the plan, or per
18 capita among the resulting corporations, as tenants in
19 common, if no specification is made in the plan, and the
20 title to any real estate, or interest therein, vested in
21 any of the corporations shall not revert or be in any way
22 impaired by reason of the division.
23 (ii) Upon the division becoming effective, the
24 resulting corporations shall each thenceforth be
25 responsible as separate and distinct corporations only
26 for such liabilities as each corporation may undertake or
27 incur in its own name, but shall be liable for the
28 liabilities of the dividing corporation in the manner and
29 on the basis provided in [paragraphs (4) and (5)]
30 subparagraphs (iv) and (v).
20030S0276B0283 - 91 -
1 (iii) Liens upon the property of the dividing
2 corporation shall not be impaired by the division.
3 (iv) To the extent allocations of liabilities are
4 contemplated by the plan of division, the liabilities of
5 the dividing corporation shall be deemed without further
6 action to be allocated to and become the liabilities of
7 the resulting corporations on such a manner and basis and
8 with such effect as is specified in the plan; and one or
9 more, but less than all, of the resulting corporations
10 shall be free of the liabilities of the dividing
11 corporation to the extent, if any, specified in the plan,
12 if in either case:
13 (A) no fraud on members without voting rights or
14 violation of law shall be effected thereby; and
15 (B) the plan does not constitute a fraudulent
16 transfer under 12 Pa.C.S. Ch. 51 (relating to
17 fraudulent transfers).
18 (v) If the conditions in subparagraph (iv) for
19 freeing one or more of the resulting corporations from
20 the liabilities of the dividing corporation or for
21 allocating some or all of the liabilities of the dividing
22 corporation are not satisfied, the liabilities of the
23 dividing corporation as to which those conditions are not
24 satisfied shall not be affected by the division nor shall
25 the rights of creditors thereunder be impaired by the
26 division and any claim existing or action or proceeding
27 pending by or against the corporation with respect to
28 those liabilities may be prosecuted to judgment as if the
29 division had not taken place, or the resulting
30 corporations may be proceeded against or substituted in
20030S0276B0283 - 92 -
1 place of the dividing corporation as joint and several
2 obligors on those liabilities, regardless of any
3 provision of the plan of division apportioning the
4 liabilities of the dividing corporation.
5 (2) It shall not be necessary for a plan of division to
6 list each individual asset or liability of the dividing
7 corporation to be allocated to a new corporation so long as
8 those assets and liabilities are described in a reasonable
9 manner.
10 (3) Each new corporation shall hold any assets and
11 liabilities allocated to it as the successor to the dividing
12 corporation, and those assets and liabilities shall not be
13 deemed to have been assigned to the new corporation in any
14 manner, whether directly or indirectly or by operation of
15 law.
16 * * *
17 (h) Conflict of laws.--It is the intent of the General
18 Assembly that:
19 (1) The effect of a division of a domestic [business]
20 nonprofit corporation shall be governed solely by the laws of
21 this Commonwealth and any other jurisdiction under the laws
22 of which any of the resulting corporations is incorporated.
23 (2) The effect of a division on the assets and
24 liabilities of the dividing corporation shall be governed
25 solely by the laws of this Commonwealth and any other
26 jurisdiction under the laws of which any of the resulting
27 corporations is incorporated.
28 (3) The validity of any allocations of assets or
29 liabilities by a plan of division of a domestic [business]
30 nonprofit corporation, regardless of whether [or not] any of
20030S0276B0283 - 93 -
1 the new corporations is a foreign [business] nonprofit
2 corporation, shall be governed solely by the laws of this
3 Commonwealth.
4 (4) In addition to the express provisions of this
5 subsection, this subchapter shall otherwise generally be
6 granted the protection of full faith and credit under the
7 Constitution of the United States.
8 § 5965. Effective date of conversion.
9 Upon the filing of articles of conversion in the Department
10 of State, or upon the effective date specified in the plan of
11 conversion, whichever is later, the conversion shall become
12 effective.
13 § 5973. Notice of meeting of members.
14 (a) General rule.--[Written notice] Notice of the meeting of
15 members that will consider the advisability of voluntarily
16 dissolving a nonprofit corporation shall be given to each member
17 of record entitled to vote thereon [and the purpose shall be
18 included]. The purpose of the meeting shall be stated in the
19 notice [of the meeting].
20 (b) Cross reference.--See Subchapter A of Chapter 57
21 (relating to notice and meetings generally).
22 § 5975. Predissolution provision for liabilities.
23 * * *
24 (c) Winding up and distribution.--The corporation shall, as
25 speedily as possible, proceed to collect all sums due it,
26 convert into cash all corporate assets the conversion of which
27 into cash is required to discharge its liabilities and, out of
28 the assets of the corporation, discharge or make adequate
29 provision for the discharge of all liabilities of the
30 corporation, according to their respective priorities. Except as
20030S0276B0283 - 94 -
1 otherwise provided in a bylaw adopted by the members or in this
2 subpart or by any other provision of law, any surplus remaining
3 after paying or providing for all liabilities of the corporation
4 shall be distributed to the shareholders, if any, pro rata, or
5 if there be no shareholders, among the members per capita. See
6 section [1972(a)] 5972(a) (relating to proposal of voluntary
7 dissolution).
8 § 5976. Judicial supervision of proceedings.
9 (a) General rule.--A nonprofit corporation that has elected
10 to proceed under section [1975] 5975 (relating to predissolution
11 provision for liabilities), at any time during the winding up
12 proceedings, may apply to the court to have the proceedings
13 continued under the supervision of the court and thereafter the
14 proceedings shall continue under the supervision of the court as
15 provided in Subchapter G (relating to involuntary liquidation
16 and dissolution).
17 * * *
18 § 5980. Dissolution by domestication.
19 Whenever a domestic nonprofit corporation has domesticated
20 itself under the laws of another jurisdiction by action similar
21 to that provided under section 6161 (relating to domestication)
22 and has authorized that action by the vote required under this
23 subchapter for the approval of a proposal that the corporation
24 dissolve voluntarily, the corporation may surrender its charter
25 under the laws of this Commonwealth by filing in the Department
26 of State articles of dissolution under this subchapter
27 containing the statements specified under section 5977(b)(1)
28 through (4) (relating to articles of dissolution). If the
29 corporation as domesticated in the other jurisdiction qualifies
30 to do business in this Commonwealth either prior to or
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1 simultaneously with the filing of the articles of dissolution
2 under this section, the corporation shall not be required to
3 file with the articles of dissolution the tax clearance
4 certificates that would otherwise be required under section 139
5 (relating to tax clearance of certain fundamental transactions).
6 § 5981. Proceedings upon [petition] application of member[,
7 etc.] or director.
8 [The court may, upon petition] Upon application filed by a
9 member or director of a nonprofit corporation, the court may
10 entertain proceedings for the involuntary winding up and
11 dissolution of the corporation[,] when any of the following
12 [are] is made to appear:
13 (1) [That the] The objects of the corporation have
14 wholly failed[;], or are entirely abandoned, or [that] their
15 accomplishment is impracticable.
16 (2) [That the] The acts of the directors, or those in
17 control of the corporation, are illegal, oppressive[,] or
18 fraudulent[,] and [that] it is beneficial to the interests of
19 the members that the corporation be wound up and dissolved.
20 (3) [That the] The corporate assets are being misapplied
21 or wasted[,] and [that] it is beneficial to the interests of
22 the members that the corporation be wound up and dissolved.
23 (4) [That the] The directors or other body are
24 deadlocked in the direction of the management of the
25 [corporate] business and affairs of the corporation and the
26 members are unable to break the deadlock[,] and [that]
27 irreparable injury to the corporation is being suffered or is
28 threatened by reason thereof. The court shall not appoint a
29 receiver or grant other similar relief under this paragraph
30 if the members by agreement or otherwise have provided for
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1 the appointment of a provisional director or member of an
2 other body or other means for the resolution of a deadlock
3 but the court shall enforce the remedy so provided if
4 appropriate.
5 § 5982. Proceedings upon [petition] application of creditor.
6 [The court may, upon petition] Upon application filed by a
7 creditor of a nonprofit corporation whose claim has either been
8 reduced to judgment and an execution thereon returned
9 unsatisfied[,] or whose claim is admitted by the corporation,
10 the court may entertain proceedings for the involuntary winding
11 up and dissolution of the corporation when, in either case, it
12 is made to appear that the corporation is unable to [pay its
13 debts and obligations] discharge its liabilities in the regular
14 course of business, as they mature, or is unable to afford
15 reasonable security to those who may deal with it.
16 § 5983. Proceedings upon petition of superior religious
17 organization.
18 The court may, in the case of any nonprofit corporation
19 organized for the support of public worship, upon [petition
20 filed by] application of the diocesan convention, presbytery,
21 synod, conference, council, or other supervising or controlling
22 organization of which the corporation is a member or with which
23 it is in allegiance and to which it is subordinate, entertain
24 proceedings for the involuntary winding up and dissolution of
25 the corporation when it is made to appear that by reason of
26 shifting population, withdrawal of membership[,] or any other
27 cause whatsoever, the corporation has ceased to support public
28 worship within the intent and meaning of its articles[,] and the
29 dissolution of the corporation may be effected without prejudice
30 to the public welfare and the interests of the members of the
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1 corporation.
2 § 5984. Appointment of receiver pendente lite and other interim
3 powers.
4 Upon the filing of [a petition] an application under this
5 subchapter, the court [shall have all the ordinary powers of a
6 court of equity to] may issue injunctions, [to] appoint a
7 receiver [or receivers,] pendente lite[,] with such powers and
8 duties as the court from time to time may direct[,] and [to take
9 such other proceedings] proceed as may be requisite to preserve
10 the corporate assets wherever situated and to carry on the
11 business of the corporation until a full hearing can be had.
12 § 5986. Qualifications of receivers.
13 A receiver shall in all cases be a [resident of this
14 Commonwealth,] natural person of full age or a corporation
15 authorized to act as receiver, which corporation, if so
16 authorized, may be a domestic corporation for profit or not-for-
17 profit or a foreign corporation for profit or not-for-profit
18 authorized to do business in this Commonwealth, and shall give
19 such bond, if any, as the court may direct, with such sureties,
20 if any, as the court may require.
21 § 5987. Proofs of claims.
22 (a) General rule.--In a proceeding under this subchapter,
23 the court may require all creditors of the nonprofit corporation
24 to file with the [prothonotary] office of the clerk of the court
25 of common pleas, or with the receiver, in such form as the court
26 may prescribe, verified proofs[, under oath,] of their
27 respective claims. If the court requires the filing of claims,
28 it shall fix a date, which shall not be less than [four months]
29 120 days from the date of the order, as the last day for filing
30 of claims[,] and shall prescribe the notice that shall be given
20030S0276B0283 - 98 -
1 to creditors and claimants of the date so fixed. Prior to or
2 after the date so fixed, the court may extend the time for the
3 filing of claims. Creditors and claimants [failing to] who do
4 not file proofs of claim on or before the date so fixed may be
5 barred, by order of court, from participating in the
6 distribution of the assets of the corporation.
7 (b) Cross reference.--See section 5979 (relating to survival
8 of remedies and rights after dissolution).
9 § 5988. Discontinuance of proceedings; reorganization.
10 [The proceedings under this subchapter may be discontinued at
11 any time during the winding up proceedings, in the following
12 manner:
13 (1) If the proceedings shall have been instituted by a
14 member or director and it is made to appear to the court that
15 the deadlock in the corporate affairs has been broken or the
16 management or control of the corporation has been changed,
17 the court, in its discretion, may dismiss the proceeding and
18 direct the receiver to redeliver to the corporation all its
19 remaining assets.
20 (2) If the proceedings shall have been instituted by a
21 creditor and it is made to appear that the debts of the
22 corporation have been paid or provided for, and that there
23 remain or can be obtained sufficient funds to enable the
24 corporation to resume its business, the court, in its
25 discretion, may dismiss the proceeding and direct the
26 receiver to redeliver to the corporation all its remaining
27 assets.
28 (3) When a compromise or reorganization of the
29 corporation is proposed, whether the proceedings shall have
30 been instituted by a member or director or by a creditor, the
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1 court, upon the summary application of any member, director,
2 creditor, or receiver, may order a meeting of the creditors,
3 or members to be summoned in such manner as the court may
4 direct. If a majority in number, representing 75% in value of
5 the creditors or if 75% of the members present in person, or
6 if a majority in number, representing 75% in value of any
7 class of creditors, or if 75% of the members of any class
8 present in person, as the case may be, agree to any
9 compromise or reorganization of the corporation, such
10 compromise or reorganization, if approved by the court as
11 fair and feasible, shall be binding on all creditors or on
12 all members, or both, or on the class of creditors or class
13 of members, or both, as the case may be, and also on the
14 corporation and its receiver, if any.
15 (4) If the proceedings shall have been instituted by a
16 superior religious organization and it is made to appear that
17 appropriate arrangements for the conduct of the affairs of
18 the corporation have been made, the court, in its discretion,
19 may dismiss the proceedings and direct the receiver to
20 redeliver to the corporation its remaining assets.]
21 The proceedings under this subchapter may be discontinued at
22 any time when it is established that cause for liquidation no
23 longer exists. In that event, the court shall dismiss the
24 proceedings and direct the receiver to redeliver to the
25 nonprofit corporation all its remaining property and assets.
26 § 6101. Application of article.
27 * * *
28 (c) Admitted foreign fraternal benefit society exclusion.--
29 This article shall not apply to any foreign corporation not-for-
30 profit qualified to do business in this Commonwealth under
20030S0276B0283 - 100 -
1 section [603] 605 of the act of [July 29, 1977 (P.L.105, No.38)]
2 December 14, 1992 (P.L.835, No.134), known as the Fraternal
3 Benefit [Society] Societies Code.
4 § 6102. Foreign domiciliary corporations.
5 A foreign nonprofit corporation is a foreign domiciliary
6 corporation if it is a corporation:
7 (1) which derived more than one-half of its revenues for
8 the preceding three fiscal years, or such portion thereof as
9 the corporation was in existence, from sources in this
10 Commonwealth and was at any time during that period doing
11 business in this Commonwealth on the basis of the most
12 minimal contacts with this Commonwealth permitted under the
13 Constitution of the United States; or
14 (2) at least a majority of the bona fide members of
15 which are residents of this Commonwealth.
16 § 6103. Acquisition of foreign domiciliary corporation status.
17 (a) General rule.--A foreign nonprofit corporation shall
18 become a foreign domiciliary corporation under section 6102
19 (relating to foreign domiciliary corporations) on the first day
20 of the month following the month in which the corporation first
21 has knowledge that either test has been met or upon entry of an
22 order by any court of competent jurisdiction declaring that
23 either test has been met.
24 (b) Newly incorporated corporations.--Where the test or
25 tests under section 6102 are met at the time of the admission of
26 the first members of the corporation and continuously
27 thereafter, foreign domiciliary corporation status when
28 established shall be retroactive to the incorporation of the
29 corporation.
30 § 6104. Termination of foreign domiciliary corporation status.
20030S0276B0283 - 101 -
1 A foreign domiciliary corporation shall cease to have that
2 status on the first day of the month following the month in
3 which the corporation first has knowledge that it no longer
4 meets either test under section 6102 (relating to foreign
5 domiciliary corporations) or upon entry of an order of any court
6 of competent jurisdiction declaring that the corporation no
7 longer meets either test.
8 § 6122. Excluded activities.
9 (a) General rule.--Without excluding other activities which
10 may not constitute doing business in this Commonwealth, a
11 foreign nonprofit corporation shall not be considered to be
12 doing business in this Commonwealth for the purposes of this
13 subchapter by reason of carrying on in this Commonwealth any one
14 or more of the following acts:
15 (1) Maintaining or defending any action or
16 administrative or arbitration proceeding or effecting the
17 settlement thereof or the settlement of claims or disputes.
18 (2) Holding meetings of its directors, other body or
19 members or carrying on other activities concerning its
20 internal affairs.
21 (3) Maintaining bank accounts.
22 (4) Maintaining offices or agencies for the transfer,
23 exchange and registration of its memberships or securities,
24 or appointing and maintaining trustees or depositories with
25 relation to its memberships or securities.
26 (5) Granting funds.
27 (6) Distributing information to its members.
28 (7) Creating as borrower or lender, acquiring or
29 incurring obligations or mortgages or other security
30 interests in real or personal property.
20030S0276B0283 - 102 -
1 (8) Securing or collecting debts or enforcing any rights
2 in property securing them.
3 (9) Transacting any business in interstate or foreign
4 commerce.
5 (10) Conducting an isolated transaction completed within
6 a period of 30 days and not in the course of a number of
7 repeated transactions of like nature.
8 (11) Inspecting, appraising and acquiring real estate
9 and mortgages and other liens thereon and personal property
10 and security interests therein, and holding, leasing,
11 conveying and transferring them, as fiduciary or otherwise.
12 (b) Exceptions.--The specification of activities in
13 subsection (a) does not establish a standard for activities that
14 may subject a foreign corporation to:
15 (1) Service of process under any statute or general
16 rule.
17 (2) Taxation by the Commonwealth or any political
18 subdivision thereof.
19 (3) The provisions of section 6145 (relating to
20 applicability of certain safeguards to foreign domiciliary
21 corporations).
22 § 6123. Requirements for foreign corporation names.
23 (a) General rule.--The Department of State shall not issue a
24 certificate of authority to any foreign nonprofit corporation
25 that, except as provided in subsection (b), has a name that is
26 rendered unavailable for use by a domestic nonprofit corporation
27 by any provision of section 5303(a), (b) or (c) (relating to
28 corporate name).
29 (b) Exceptions.--
30 (1) The provisions of section 5303(b) (relating to
20030S0276B0283 - 103 -
1 duplicate use of names) shall not prevent the issuance of a
2 certificate of authority to a foreign nonprofit corporation
3 setting forth a name that is [confusingly similar to] not
4 distinguishable upon the records of the department from the
5 name of any other domestic or foreign corporation for profit
6 or [corporation] not-for-profit, [or of any domestic or
7 foreign limited partnership that has filed a certificate or
8 qualified under Chapter 85 (relating to limited partnerships)
9 or corresponding provisions of prior law,] or of any
10 corporation or other association then registered under 54
11 Pa.C.S. Ch. 5 (relating to corporate and other association
12 names) or to any name reserved or registered as provided in
13 this part, if the foreign nonprofit corporation applying for
14 a certificate of authority files in the department [one of
15 the following:
16 (i) A] a resolution of its board of directors or
17 other body adopting a fictitious name for use in
18 transacting business in this Commonwealth, which
19 fictitious name is [not confusingly similar to]
20 distinguishable upon the records of the department from
21 the name of the other corporation or other association
22 [or to] and from any name reserved or registered as
23 provided in this part [and] that is otherwise available
24 for use by a domestic nonprofit corporation.
25 [(ii) The written consent of the other corporation
26 or other association or holder of a reserved or
27 registered name to use the same or confusingly similar
28 name and one or more words are added to make the name
29 applied for distinguishable from the other name.]
30 (2) The provisions of section 5303(c) (relating to
20030S0276B0283 - 104 -
1 required approvals or conditions) shall not prevent the
2 issuance of a certificate of authority to a foreign nonprofit
3 corporation setting forth a name that is prohibited by that
4 subsection if the foreign nonprofit corporation applying for
5 a certificate of authority files in the department a
6 resolution of its board of directors or other body adopting a
7 fictitious name for use in transacting business in this
8 Commonwealth that is available for use by a domestic
9 nonprofit corporation.
10 § 6141. Penalty for doing business without certificate of
11 authority.
12 (a) Right to bring actions suspended.--[No] A nonqualified
13 foreign nonprofit corporation doing business in this
14 Commonwealth within the meaning of Subchapter B [of this
15 chapter] (relating to qualification) shall not be permitted to
16 maintain any action or proceeding in any court of this
17 Commonwealth until [such] the corporation [shall have] has
18 obtained a certificate of authority. Nor, except as provided in
19 subsection (b) [of this section], shall any action or proceeding
20 be maintained in any court of this Commonwealth by any successor
21 or assignee of [such] the corporation on any right, claim or
22 demand arising out of the doing of business by [such] the
23 corporation in this Commonwealth until a certificate of
24 authority [shall have] has been obtained by [such] the
25 corporation or by a corporation [which] that has acquired all or
26 substantially all of its assets.
27 (b) Contracts, property and defense against actions
28 unaffected.--The failure of a foreign nonprofit corporation to
29 obtain a certificate of authority to transact business in this
30 Commonwealth shall not impair the validity of any contract or
20030S0276B0283 - 105 -
1 act of [such] the corporation [and], shall not prevent [such]
2 the corporation from defending any action in any court of this
3 Commonwealth and shall not render escheatable any of its real or
4 personal property.
5 [(b) Title to real property.--The title to any real estate
6 situate in this Commonwealth which is derived through any
7 nonqualified foreign corporation not authorized under the laws
8 of this Commonwealth to hold the same, and which has vested or
9 vests in any foreign corporation for profit or not-for-profit
10 authorized to hold such real estate or in any citizen or
11 citizens of the United States or domestic corporation for profit
12 or not-for-profit shall be good and valid and free and clear of
13 any right of escheat by the Commonwealth; and the holder thereof
14 may convey an estate indefeasible as to any right of escheat
15 which the Commonwealth might otherwise have by reason of the
16 unauthorized holding and conveyance by such nonqualified foreign
17 corporation.]
18 § 6142. General powers and duties of qualified foreign
19 corporations.
20 (a) General rule.--A qualified foreign nonprofit
21 corporation, so long as its certificate of authority [shall] is
22 not [be] revoked, shall enjoy the same rights and privileges as
23 a domestic nonprofit corporation, but no more, and, except as in
24 this [part] subpart otherwise provided, shall be subject to the
25 same liabilities, restrictions, duties and penalties now in
26 force or hereafter imposed upon domestic nonprofit corporations,
27 to the same extent as if it had been incorporated under this
28 [part to transact the business set forth in its certificate of
29 authority] subpart.
30 (b) Agricultural lands.--Interests in agricultural land
20030S0276B0283 - 106 -
1 shall be subject to the restrictions of, and escheatable as
2 provided by the act of April 6, 1980 (P.L.102, No.39), referred
3 to as the Agricultural Land Acquisition by Aliens Law.
4 § 6143. General powers and duties of nonqualified foreign
5 corporations.
6 (a) Acquisition of real and personal property.--Every
7 nonqualified foreign nonprofit corporation[, the activities of
8 which in this Commonwealth do not constitute doing business in
9 this Commonwealth for the purposes of Subchapter B of this
10 chapter (relating to qualification),] may acquire, hold,
11 mortgage, lease and transfer real and personal property in this
12 Commonwealth, in the same manner and subject to the same
13 limitations as [domestic] a qualified foreign nonprofit
14 [corporations] corporation.
15 (b) Duties.--[A] Except as provided in section 6141(a)
16 (relating to right to bring actions suspended), a nonqualified
17 foreign nonprofit corporation doing business in this
18 Commonwealth within the meaning of Subchapter B [of this
19 chapter] (relating to qualification) shall be subject to the
20 same liabilities, restrictions, duties and penalties now or
21 hereafter imposed upon a qualified foreign nonprofit
22 corporation.
23 § 6145. Applicability of certain safeguards to foreign
24 domiciliary corporations.
25 [(a) Application.--This section shall be applicable to any
26 qualified or nonqualified foreign corporation:
27 (1) which derived more than one-half of its revenues for
28 the preceding three fiscal years, or such portion thereof as
29 the corporation was in existence, from sources within this
30 Commonwealth and was at any time during such period doing
20030S0276B0283 - 107 -
1 business within this Commonwealth on the basis of the most
2 minimal contacts with this Commonwealth permitted under the
3 Constitution of the United States; or
4 (2) at least a majority of the bona fide members of
5 which are residents of this Commonwealth.
6 (b)] (a) Internal affairs doctrine not applicable.--The
7 General Assembly hereby finds and determines that [the] foreign
8 domiciliary corporations [to which this section applies]
9 substantially affect this Commonwealth. [No court] The courts of
10 this Commonwealth shall [hereafter] not dismiss or stay any
11 action or proceeding brought by a member[, director, officer or
12 agent of such a] or representative of a foreign domiciliary
13 corporation, as such, against [such] the corporation or any one
14 or more of the members[, directors, officers or agents] or
15 representatives thereof, as such, on the ground that [such] the
16 corporation is a foreign corporation not-for-profit or that the
17 cause of action relates to the internal affairs thereof, but
18 every such action shall proceed with like effect as if [such]
19 the corporation were a domestic corporation. Except as provided
20 in subsection [(c) of this section] (b), the court having
21 jurisdiction of the action or proceeding shall apply the law of
22 the jurisdiction under which the foreign domiciliary corporation
23 was incorporated.
24 [(c)] (b) Minimum safeguards.--The following provisions of
25 this subpart shall be applicable to foreign domiciliary
26 corporations [to which this section applies], except that
27 nothing in this subsection shall require the filing of any
28 document in the Department of State as a prerequisite to the
29 validity of any corporate action or the doing of any corporate
30 action by the foreign domiciliary corporation which is
20030S0276B0283 - 108 -
1 impossible under the laws of its domiciliary jurisdiction:
2 [(1)] Section 5504(b) (relating to adoption and contents
3 of bylaws).
4 [(2)] Section 5508 (relating to corporate records;
5 inspection).
6 [(3)] Section [5553] 5554 (relating to annual report of
7 directors or other body).
8 [(4)] Section 5743 (relating to mandatory
9 indemnification).
10 [(5)] Section 5755 (relating to time of holding meetings
11 of members).
12 [(6)] Section 5758(e) (relating to voting lists).
13 [(7)] Section [5759(b) (relating to minimum
14 requirements] 5759(c) (relating to revocation).
15 [(8)] Section [5762] 5765 (relating to judges of
16 election).
17 [(9)] Section [5764] 5767 (relating to appointment of
18 custodian of corporation on deadlock or other cause).
19 [(10)] Section [5766(b)] 5769(b) (relating to
20 expulsion).
21 [(11) Subchapter G of Chapter 57 (relating to judicial
22 supervision of corporate action).]
23 [(12)] Chapter 59 (relating to fundamental changes).
24 For the purposes of this subsection, corporate action shall not
25 be deemed to be impossible under the laws of the domiciliary
26 jurisdiction of a foreign corporation merely because prohibited
27 or restricted by the terms of the articles, certificate of
28 incorporation, bylaws or other organic law of the corporation,
29 but the court may require the corporation to amend such organic
30 law so as to be consistent with the minimum safeguards
20030S0276B0283 - 109 -
1 prescribed by this subsection.
2 [(d)] (c) Section exclusive.--[No provision of this article]
3 The provisions of this subpart, other than the provisions of
4 this section, shall not be construed to regulate the
5 incorporation or internal affairs of a foreign corporation not-
6 for-profit.
7 § 8202. Definitions.
8 The following words and phrases when used in this chapter
9 shall have the meanings given to them in this section unless the
10 context clearly indicates otherwise:
11 * * *
12 "Restricted professional partnership." A domestic or foreign
13 registered limited liability partnership that renders one or
14 more restricted professional services.
15 "Restricted professional services." The term shall have the
16 meaning specified in section 8903 (relating to definitions and
17 index of definitions).
18 § 8204. Limitation on liability of partners.
19 (a) General rule.--Except as provided in subsection (b)[,
20 a]:
21 (1) A partner in a registered limited liability
22 partnership that is not a restricted professional partnership
23 shall not be [individually] liable directly or indirectly,
24 whether by way of indemnification, contribution, assessment
25 or otherwise, for debts and obligations of, or chargeable to,
26 the partnership, whether sounding in contract or tort or
27 otherwise, that arise from any negligent or wrongful acts or
28 misconduct committed by another partner or other
29 representative of the partnership while the registration of
30 the partnership under this subchapter is in effect.
20030S0276B0283 - 110 -
1 (2) A partner in a restricted professional partnership
2 shall not be liable directly or indirectly, whether by way of
3 indemnification, contribution, assessment or otherwise, under
4 an order of a court or in any other manner for a debt,
5 obligation or liability of the partnership of any kind
6 arising while the partnership has the status of a restricted
7 professional partnership or for acts of another partner or
8 other representative of the partnership committed while the
9 partnership has the status of a restricted professional
10 partnership.
11 (b) Exceptions.--
12 (2) Subsection (a) shall not affect the liability of a
13 partner:
14 (i) Individually for any negligent or wrongful acts
15 or misconduct committed by him or by any person under his
16 direct supervision and control.
17 (ii) For any debts or obligations of the
18 partnership[:
19 (A) arising from any cause other than those
20 specified in subsection (a); or
21 (B)] as to which the partner has agreed in
22 writing to be liable.
23 (iii) To the extent expressly undertaken in the
24 partnership agreement or the certificate of limited
25 partnership.
26 (3) Subsection (a) shall not affect in any way:
27 (i) the liability of the partnership itself for all
28 its debts and obligations;
29 (ii) the availability of the entire assets of the
30 partnership to satisfy its debts and obligations; or
20030S0276B0283 - 111 -
1 (iii) any obligation undertaken by a partner in
2 writing to individually indemnify another partner of the
3 partnership or to individually contribute toward a
4 liability of another partner.
5 (4) Subsection (a)(1) shall not affect the liability of
6 a partner for any debts or obligations of the partnership
7 arising from any cause other than those specified in
8 subsection (a)(1).
9 (5) Subsection (a)(2) shall not apply to debts or
10 obligations arising, or acts committed, before the effective
11 date of subsection (a)(2).
12 (c) Continuation of limited liability.--Neither the
13 termination of the registration of a partnership under this
14 subchapter nor the dissolution of the partnership shall affect
15 the limitation on the liability of a partner in the partnership
16 under this section with respect to negligent or wrongful acts or
17 misconduct occurring while the registration under this
18 subchapter was in effect.
19 (c.1) Proper parties.--A partner in a registered limited
20 liability partnership is not a proper party to an action or
21 proceeding by or against the partnership, the object of which is
22 to recover damages or enforce obligations for which the partner
23 is not liable under this section.
24 (d) Cross reference.--See section 103 (relating to
25 subordination of title to regulatory laws).
26 § 8205. Liability of withdrawing partner.
27 (a) General rule.--Except as provided in subsection (b), if
28 the business of a registered limited liability partnership is
29 continued without liquidation of the partnership affairs
30 following the dissolution of the partnership as a result of the
20030S0276B0283 - 112 -
1 withdrawal for any reason of a partner, the withdrawing partner
2 shall not be [individually] liable directly or indirectly,
3 whether by way of indemnification, contribution, assessment or
4 otherwise, under an order of a court or in any other manner for
5 any of the debts [and], obligations or liabilities of any kind
6 of either the dissolved partnership or any partnership
7 continuing the business if a statement of withdrawal is filed as
8 provided in this section.
9 (b) Exceptions.--Subsection (a) shall not affect the
10 liability of a partner:
11 (1) Individually for any negligent or wrongful acts or
12 misconduct committed by him or by any person under his direct
13 supervision and control.
14 (2) For any debts or obligations of the partnership as
15 to which the withdrawing partner has agreed in writing to be
16 liable.
17 (3) To the partnership for damages if the partnership
18 agreement prohibits the withdrawal of the partner or the
19 withdrawal otherwise violates the partnership agreement.
20 (4) Under section 8334 (relating to partner accountable
21 as fiduciary).
22 (5) To the extent a debt or obligation of the
23 partnership has been expressly undertaken by the partner in
24 the partnership agreement or the certificate of limited
25 partnership.
26 (6) If the partnership subsequently dissolves within one
27 year after the date of withdrawal of the partner and the
28 business of the partnership is not continued following such
29 subsequent dissolution. This paragraph shall not be
30 applicable in the case of a withdrawal caused by:
20030S0276B0283 - 113 -
1 (i) the death of the partner; or
2 (ii) the retirement of the partner pursuant to a
3 retirement policy of the dissolved partnership that has
4 been in effect prior to the retirement of the partner for
5 the shorter of one year or the period that the
6 partnership has been in existence.
7 (7) For any obligation undertaken by a partner in
8 writing to individually indemnify another partner of the
9 partnership or to individually contribute toward a liability
10 of another partner.
11 (c) Statement of withdrawal.--A statement of withdrawal
12 shall be executed by the withdrawing partner or his personal
13 representative and shall set forth:
14 (1) The name of the registered limited liability
15 partnership.
16 (2) The name of the withdrawing partner.
17 (d) Filing and effectiveness.--The statement of withdrawal
18 shall be filed in the Department of State and shall be effective
19 upon filing. The withdrawing partner shall send a copy of the
20 filed statement of withdrawal to the registered limited
21 liability partnership.
22 (e) Permissive filing.--Filing under this section is
23 permissive, and failure to make a filing under this section by a
24 partner entitled to do so shall not affect the right of that
25 partner to the limitation on liability provided by section 8204
26 (relating to limitation on liability of partners).
27 (f) Constructive notice.--Filing under this section shall
28 constitute constructive notice that the partner has withdrawn
29 from the partnership and is entitled to the protection from
30 liability provided by this section.
20030S0276B0283 - 114 -
1 (g) Variation of section.--A written provision of the
2 partnership agreement may restrict or condition the application
3 of this section to some or all of the partners of the
4 partnership.
5 (h) Application of section.--
6 (1) A partner in a foreign registered limited liability
7 partnership, regardless of whether or not it has registered
8 to do business in this Commonwealth under section 8211
9 (relating to foreign registered limited liability
10 partnerships), shall not be entitled to make a filing under
11 this section with regard to that partnership.
12 (2) This section shall not apply to a restricted
13 professional partnership.
14 (h.1) Proper parties.--A partner in a registered limited
15 liability partnership is not a proper party to an action or
16 proceeding by or against the partnership, the object of which is
17 to recover damages or enforce obligations for which the partner
18 is not liable under this section.
19 (i) Cross references.--See sections 134 (relating to
20 docketing statement) and 135 (relating to requirements to be met
21 by filed documents).
22 § 8211. Foreign registered limited liability partnerships.
23 * * *
24 (c) Exception.--The liability of the partners in a foreign
25 registered limited liability partnership shall be governed by
26 the laws of the jurisdiction under which it is organized, except
27 that the partners in a foreign registered limited liability
28 partnership that is not a restricted professional partnership
29 shall not be entitled to greater protection from liability than
30 is available to the partners in a domestic registered limited
20030S0276B0283 - 115 -
1 liability partnership that is not a restricted professional
2 partnership.
3 § 8221. Annual registration.
4 (a) General rule.--Every domestic registered limited
5 liability partnership in existence on December 31 of any year
6 and every foreign registered limited liability partnership that
7 is registered to do business in this Commonwealth on December 31
8 of any year shall file in the Department of State with respect
9 to that year, and on or before April 15 of the following year, a
10 certificate of annual registration on a form provided by the
11 department, signed by a general partner and accompanied by the
12 annual registration fee prescribed by subsection (b). The
13 department shall not charge a fee other than the annual
14 registration fee for filing the certificate of annual
15 registration.
16 (b) Annual registration fee.--
17 (1) The annual registration fee to be paid when filing a
18 certificate of annual registration shall be equal to [a] the
19 base fee [of $200] set forth in paragraph (2) or (3) times
20 the number of persons who were general partners of the
21 partnership on December 31 of the year with respect to which
22 the certificate of annual registration is being filed and
23 who:
24 (i) in the case of a natural person, had his
25 principal residence on that date in this Commonwealth; or
26 (ii) in the case of any other person, was
27 incorporated or otherwise organized or existing on that
28 date under the laws of this Commonwealth.
29 (2) The base fee [of $200] for a partnership that is not
30 a restricted professional partnership shall be $240 and shall
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1 be increased on December 31, [1997] 2003, and December 31 of
2 every third year thereafter by the percentage increase in the
3 Consumer Price Index for Urban Workers during the most recent
4 three calendar years for which that index is available on the
5 date of adjustment. Each adjustment under this paragraph
6 shall be rounded up to the nearest $10.
7 (3) The base fee for a restricted professional
8 partnership shall be $300 and shall be increased on December
9 31, 2006, and December 31 of every third year thereafter by
10 the percentage increase in the Consumer Price Index for Urban
11 Workers during the most recent three calendar years for which
12 that index is available on the date of adjustment. Each
13 adjustment under this paragraph shall be rounded up to the
14 nearest $10.
15 (c) Notice of annual registration.--Not later than February
16 1 of each year, the department shall give notice to every
17 partnership required to file a certificate of annual
18 registration with respect to the preceding year of the
19 requirement to file the certificate. The notice shall state the
20 amount of the base fee payable under subsection (b)(1), as
21 adjusted pursuant to subsection (b)(2), if applicable, and shall
22 be accompanied by the form of certificate of annual registration
23 to be filed. Failure by the department to give notice to any
24 party, or failure by any party to receive notice, of the annual
25 registration requirement shall not relieve the party of the
26 obligation to file the certificate of annual registration.
27 (d) Credit to Corporation Bureau Restricted Account.--The
28 annual registration fee shall not be deemed to be an amount
29 received by the department under Subchapter C of Chapter 1 for
30 purposes of section 155 (relating to disposition of funds),
20030S0276B0283 - 117 -
1 except that $25 of the fee shall be credited to the Corporation
2 Bureau Restricted Account.
3 (e) Failure to pay annual fee.--
4 (1) Failure to file the certificate of annual
5 registration required by this section for five consecutive
6 years shall result in the automatic termination of the status
7 of the registered limited liability partnership as such. In
8 addition, any annual registration fee that is not paid when
9 due shall be a lien in the manner provided in this subsection
10 from the time the annual registration fee is due and payable.
11 If a certificate of annual registration is not filed within
12 30 days after the date on which it is due, the department
13 shall assess a penalty of $500 against the partnership, which
14 shall also be a lien in the manner provided in this
15 subsection. The imposition of that penalty shall not be
16 construed to relieve the partnership from liability for any
17 other penalty or interest provided for under other applicable
18 law.
19 (2) If the annual registration fee paid by a registered
20 limited liability partnership is subsequently determined to
21 be less than should have been paid because it was based on an
22 incorrect number of general partners or was otherwise
23 incorrectly computed, that fact shall not affect the
24 existence or status of the registered limited liability
25 partnership as such, but the amount of the additional annual
26 registration fee that should have been paid shall be a lien
27 in the manner provided in this subsection from the time the
28 incorrect payment is discovered by the department.
29 (3) The annual registration fee shall bear simple
30 interest from the date that it becomes due and payable until
20030S0276B0283 - 118 -
1 paid. The interest rate shall be that provided for in section
2 806 of the act of April 9, 1929 (P.L.343, No.176), known as
3 The Fiscal Code, with respect to unpaid taxes. The penalty
4 provided for in paragraph (1) shall not bear interest. The
5 payment of interest shall not relieve the registered limited
6 liability partnership from liability for any other penalty or
7 interest provided for under other applicable law.
8 (4) The lien created by this subsection shall attach to
9 all of the property and proceeds thereof of the registered
10 limited liability partnership in which a security interest
11 can be perfected in whole or in part by filing in the
12 department under 13 Pa.C.S. Div. 9 (relating to secured
13 transactions; sales of accounts, contract rights and chattel
14 paper), whether the property and proceeds are owned by the
15 partnership at the time the annual registration fee or any
16 penalty or interest becomes due and payable or whether the
17 property and proceeds are acquired thereafter. Except as
18 otherwise provided by statute, the lien created by this
19 subsection shall have priority over all other liens, security
20 interests or other charges, except liens for taxes or other
21 charges due the Commonwealth. The lien created by this
22 subsection shall be entered on the records of the department
23 and indexed in the same manner as a financing statement filed
24 under 13 Pa.C.S. Div. 9. At the time an annual registration
25 fee, penalty or interest that has resulted in the creation of
26 a lien under this subsection is paid, the department shall
27 terminate the lien with respect to that annual registration
28 fee, penalty or interest without requiring a separate filing
29 by the partnership for that purpose.
30 (5) If the annual registration fee paid by a registered
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1 limited liability partnership is subsequently determined to
2 be more than should have been paid for any reason, no refund
3 of the additional fee shall be made.
4 (6) Termination of the status of a registered limited
5 liability partnership as such, whether voluntarily or
6 involuntarily, shall not release it from the obligation to
7 pay any accrued fees, penalties and interest and shall not
8 release the lien created by this subsection.
9 (f) Exception for bankrupt partnerships.--A partnership that
10 would otherwise be required to pay the annual registration fee
11 set forth in subsection (b) shall not be required to pay that
12 fee with respect to any year during any part of which the
13 partnership is a bankrupt as defined in section 8903 (relating
14 to definitions and index of definitions). The partnership shall,
15 instead, indicate on its certificate of annual registration for
16 that year that it is exempt from payment of the annual
17 registration fee pursuant to this subsection. If the partnership
18 fails to file timely a certificate of annual registration, a
19 lien shall be entered on the records of the department pursuant
20 to subsection (e) which shall not be removed until the
21 partnership files a certificate of annual registration
22 indicating its entitlement to an exemption from payment of the
23 annual registration fee as provided in this subsection. See
24 section 8201(e) (relating to scope).
25 § 8304. Rules of construction.
26 (a) * * *
27 (c) Validation of prohibition of assignments.--
28 (1) The provisions of 13 Pa.C.S. §§ 9406 (relating to
29 discharge of account debtor; notification of assignment;
30 identification and proof of of assignment; restrictions on
20030S0276B0283 - 120 -
1 assignments of accounts, chattel paper, payment intangibles
2 and promissory notes ineffective) and 9408 (relating to
3 restrictions on assignment of promissory notes, health-care-
4 insurance receivables and certain general intangibles
5 ineffective) shall not apply to any interest in a domestic
6 partnership, including any right, power and interest arising
7 under a partnership agreement or this part.
8 (2) This subsection shall be construed to prevail over
9 13 Pa.C.S. §§ 9406 and 9408.
10 § 8562. Assignment of partnership interest.
11 (a) General rule.--Except as otherwise provided in the
12 partnership agreement:
13 (1) a partnership interest is assignable in whole or in
14 part;
15 (2) an assignment of a partnership interest does not
16 dissolve a limited partnership or entitle the assignee to
17 become or to exercise any rights of a partner;
18 (3) an assignment entitles the assignee to share in such
19 profits and losses, to receive such distributions, and to
20 receive such allocations of income, gain, loss, deduction, or
21 credit or similar item to which the assignor was entitled, to
22 the extent assigned; [and]
23 (4) a partner ceases to be a partner and to have the
24 power to exercise any rights or powers of a partner upon
25 assignment of all of his partnership interest[.]; and
26 (5) the pledge of, or granting of a security interest,
27 lien or other encumbrance in or against, any or all of the
28 partnership interest of a partner shall not cause the partner
29 to cease to be a partner or to have the power to exercise any
30 rights or powers of a partner.
20030S0276B0283 - 121 -
1 * * *
2 (d) Validation of prohibition of assignments.--
3 (1) The provisions of 13 Pa.C.S. §§ 9406 (relating to
4 discharge of account debtor; notification of assignment;
5 identification and proof of assignment; restrictions on
6 assignments of accounts, chattel paper, payment intangibles
7 and promissory notes ineffective) and 9408 (relating to
8 restrictions on assignment of promissory notes, health-care-
9 insurance receivables and certain general intangibles
10 ineffective) shall not apply to any interest in a domestic
11 limited partnership, including any right, power and interest
12 arising under a partnership agreement or this part.
13 (2) This section shall be construed to prevail over 13
14 Pa.C.S. §§ 9406 and 9408.
15 § 8909. Validation of prohibitions of assignments.
16 (a) Secured transactions.--The provisions of 13 Pa.C.S. §§
17 9406 (relating to discharge of account debtor; notification of
18 assignment; identification and proof of assignment; restrictions
19 on assignments of accounts, chattel paper, payment intangibles
20 and promissory notes ineffective) and 9408 (relating to
21 restrictions on assignment of promissory notes, health-care-
22 insurance receivables and certain general intangibles
23 ineffective) shall not apply to any interest in a domestic
24 limited liability company, including any right, power and
25 interest arising under an operating agreement or this part.
26 (b) Construction.--This subsection shall be construed to
27 prevail over 13 Pa.C.S. §§ 9406 and 9408.
28 § 8916. Operating agreement.
29 (a) General rule.--The operating agreement of a limited
30 liability company need not be in writing except where this
20030S0276B0283 - 122 -
1 chapter refers to a written provision of the operating
2 agreement. If a written operating agreement provides that it
3 cannot be amended or modified except in writing, an oral
4 agreement, amendment or modification shall not be enforceable.
5 The certificate of organization or operating agreement may not
6 authorize an oral agreement on any subject that this chapter
7 requires to be dealt with in writing. See section 107(b)
8 (relating to form of records).
9 (b) Freedom of contract.--An operating agreement may contain
10 any provision adopted by the members for the regulation of the
11 internal affairs of a limited liability company [adopted by the
12 members], whether or not specifically authorized by or in
13 contravention of this chapter, except where this chapter:
14 (1) refers only to a rule as set forth in the
15 certificate of organization; or
16 (2) expressly provides that the operating agreement
17 shall not relax or contravene any provision on a specified
18 subject.
19 * * *
20 § 8941. Management.
21 * * *
22 (b) Managers.--The certificate of organization may provide
23 that management of a company shall be vested, to the extent
24 provided in, or pursuant to, the certificate of organization, in
25 one or more managers.
26 * * *
27 § 8948. Limitation on dissociation [or assignment] of
28 membership interest.
29 [Notwithstanding anything to the contrary set forth in this
30 part, an operating agreement may provide that a member may not]
20030S0276B0283 - 123 -
1 (a) General rule.--A member may voluntarily dissociate from
2 [the] a limited liability company [or assign his membership
3 interest] prior to the dissolution and winding-up of the
4 company[, and an attempt by a member to dissociate voluntarily
5 from the company or to assign his membership interest in
6 violation of the operating agreement shall be ineffective.] only
7 at the time or upon the happening of events specified in writing
8 in the operating agreement.
9 (b) Transitional rule.--This section applies to all limited
10 liability companies formed on or after January 1, 2004. If the
11 operating agreement of a company formed before January 1, 2004,
12 did not on December 31, 2003, specify in writing the time or the
13 events upon the happening of which a member could dissociate or
14 a definite time for the dissolution and winding-up of the
15 company, the provisions of this section that were in effect
16 prior to January 1, 2004, shall apply until such time, if any,
17 as the operating agreement is amended in writing after January
18 1, 2004, to specify:
19 (1) a time or the events upon the happening of which a
20 member may dissociate;
21 (2) a definite time for the dissolution and winding-up
22 of the company; or
23 (3) that this section as effective January 1, 2004,
24 shall apply to the company.
25 § 8971. Dissolution.
26 (a) General rule.--A limited liability company is dissolved
27 and its affairs shall be wound up upon the happening of the
28 first to occur of the following events:
29 (1) At the time or upon the happening of events
30 specified in the certificate of organization.
20030S0276B0283 - 124 -
1 (2) At the time or upon the happening of events
2 specified in writing in the operating agreement.
3 (3) Except as otherwise provided in the operating
4 agreement, by the [unanimous written agreement] vote or
5 consent of [all] the members.
6 [(4) Except as otherwise provided in writing in the
7 operating agreement, upon a member becoming a bankrupt or
8 executing an assignment for the benefit of creditors or the
9 death, retirement, insanity, resignation, expulsion or
10 dissolution of a member or the occurrence of any other event
11 that terminates the continued membership of a member in the
12 company unless the business of the company is continued by
13 the vote or consent of a majority in interest, or such
14 greater number as shall be provided in writing in the
15 operating agreement, of the remaining members given within
16 180 days following such event.]
17 (5) Entry of an order of judicial dissolution under
18 section 8972 (relating to judicial dissolution).
19 (b) Perpetual existence.--[The certificate of organization
20 may provide that the company shall have perpetual existence, in
21 which case subsection (a)(4) shall not be applicable to the
22 company.] Except as provided in writing in the operating
23 agreement, a limited liability company has perpetual existence,
24 subject to the power of the General Assembly under the
25 Constitution of Pennsylvania.
26 § 8974. Distribution of assets upon dissolution.
27 (a) General rule.--In settling accounts after dissolution,
28 the liabilities of the limited liability company shall be
29 entitled to payment in the following order:
30 (1) Those to creditors, including members or managers
20030S0276B0283 - 125 -
1 who are creditors, in the order of priority as provided by
2 law, in satisfaction of the liabilities of the company,
3 whether by payment or the making of [reasonable] adequate
4 provision for payment thereof, other than liabilities for
5 distributions to members under section 8932 (relating to
6 distributions and allocation of profits and losses) or 8933
7 (relating to distributions upon an event of dissociation).
8 (2) Unless otherwise provided in the operating
9 agreement, to members and former members in satisfaction of
10 liabilities for distributions under section 8932 or 8933.
11 (3) Unless otherwise provided in the operating
12 agreement, to members in respect of:
13 (i) Their contributions to capital.
14 (ii) Their share of the profits and other
15 compensation by way of income on their contributions.
16 (b) Provision for claims.--A company that has dissolved
17 shall pay or make [reasonable] adequate provision to pay all
18 claims and obligations, including all contingent, conditional or
19 unmatured claims and obligations, known to the company and all
20 claims and obligations that are known to the company but for
21 which the identity of the claimant is unknown. If there are
22 sufficient assets, such claims and obligations shall be paid in
23 full, and any such provision for payment made shall be made in
24 full. If there are insufficient assets, such claims and
25 obligations shall be paid or provided for according to their
26 priority and, among claims and obligations of equal priority,
27 ratably to the extent of assets available therefor. Unless
28 otherwise provided in the operating agreement, any remaining
29 assets shall be distributed as provided in this chapter. Any
30 liquidating trustee or other person winding up the affairs of a
20030S0276B0283 - 126 -
1 company who has complied with this section shall not be
2 personally liable to the claimants of the dissolved company by
3 reason of his actions in winding up the company.
4 § 8975. Certificate of dissolution.
5 (a) General rule.--When all debts, liabilities and
6 obligations of the limited liability company have been paid and
7 discharged or adequate provision has been made therefor and all
8 of the remaining property and assets of the company have been
9 distributed to the members, or in case its assets are not
10 sufficient to discharge its debts, liabilities and obligations,
11 when all the assets have been fairly and equitably applied, as
12 far as they will go, to the payment of such debts, liabilities
13 and obligations, a certificate of dissolution shall be executed
14 by the company. The certificate of dissolution shall set forth:
15 (1) The name of the company.
16 (2) [That] A statement that:
17 (i) all debts, obligations and liabilities of the
18 company have been paid and discharged or that adequate
19 provision has been made therefor[.]; or
20 (ii) the assets of the company are not sufficient to
21 discharge its debts, liabilities and obligations, and
22 that all the assets of the company have been fairly and
23 equitably applied, as far as they will go, to the payment
24 of such debts, liabilities and obligations.
25 (3) That all the remaining property and assets of the
26 company have been distributed among its members in accordance
27 with their respective rights and interests.
28 (4) That there are no actions pending against the
29 company in any court or that adequate provision has been made
30 for the satisfaction of any judgment that may be entered
20030S0276B0283 - 127 -
1 against it in any pending action.
2 * * *
3 CHAPTER 91
4 UNINCORPORATED ASSOCIATIONS GENERALLY
5 SUBCHAPTER A
6 GENERAL PROVISIONS
7 * * *
8 SUBCHAPTER B
9 UNIFORM UNINCORPORATED NONPROFIT
10 ASSOCIATION ACT
11 Sec.
12 9121. Short title and application of subchapter.
13 9122. Definitions.
14 9123. Territorial application.
15 9124. Acquisition of property.
16 9125. Statement of authority as to real property.
17 9126. Status; liability in tort and contract.
18 9127. Capacity to assert and defend; standing.
19 9128. Effect of judgment or order.
20 9129. Disposition of personal property of inactive nonprofit
21 association.
22 9130. Appointment of agent to receive service of process.
23 9131. Claim not abated by change of members or officers.
24 § 9121. Short title and application of subchapter.
25 (a) Short title.--This subchapter shall be known and may be
26 cited as the Uniform Unincorporated Nonprofit Association Act.
27 (b) Application of subchapter generally.--This subchapter
28 shall apply to every nonprofit association heretofore or
29 hereafter organized.
30 (c) Transitional provisions concerning property.--
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1 (1) If, before (the Legislative Reference Bureau shall
2 insert here the effective date of this subchapter), an estate
3 or interest in real or personal property was purportedly
4 transferred to a nonprofit association, on (the Legislative
5 Reference Bureau shall insert here the effective date of this
6 subchapter) the estate or interest vests in the nonprofit
7 association unless the parties have treated the transfer as
8 ineffective.
9 (2) If, before (the Legislative Reference Bureau shall
10 insert here the effective date of this subchapter), the
11 transfer vested the estate or interest in another person to
12 hold the estate or interest as a fiduciary for the benefit of
13 the nonprofit association, its members, or both, on or after
14 (the Legislative Reference Bureau shall insert here the
15 effective date of this subchapter) the fiduciary may transfer
16 the estate or interest to the nonprofit association in its
17 name, or the nonprofit association, by appropriate
18 proceedings, may require that the estate or interest be
19 transferred to it in its name.
20 (d) Savings provision.--This subchapter replaces existing
21 law with respect to matters covered by this subchapter but does
22 not affect other law respecting nonprofit associations.
23 (e) Cross reference.--See section 5331 (relating to
24 incorporation of unincorporated associations).
25 § 9122. Definitions.
26 The following words and phrases when used in this subchapter
27 shall have the meanings given to them in this section unless the
28 context clearly indicates otherwise:
29 "Member." A person who, under the rules or practices of a
30 nonprofit association, may participate in the selection of
20030S0276B0283 - 129 -
1 persons authorized to manage the affairs of the nonprofit
2 association or in the development of policy of the nonprofit
3 association.
4 "Nonprofit association." An unincorporated organization
5 consisting of two or more members joined by mutual consent for a
6 common, nonprofit purpose. However, joint tenancy, tenancy in
7 common, or tenancy by the entireties does not by itself
8 establish a nonprofit association, even if the co-owners share
9 use of the property for a nonprofit purpose.
10 § 9123. Territorial application.
11 Real and personal property in this Commonwealth may be
12 acquired, held, encumbered and transferred by a nonprofit
13 association, whether or not the nonprofit association or a
14 member has any other relationship to this Commonwealth.
15 § 9124. Acquisition of property.
16 (a) General rule.--A nonprofit association in its name may
17 acquire, hold, encumber or transfer an estate or interest in
18 real or personal property.
19 (b) Testamentary and fiduciary dispositions.--A nonprofit
20 association may be a legatee, devisee or beneficiary of a trust
21 or contract.
22 § 9125. Statement of authority as to real property.
23 (a) General rule.--A nonprofit association may sign and
24 record a statement of authority to encumber or transfer an
25 estate or interest in real property in the name of the nonprofit
26 association.
27 (b) Transfer by authorized person of record.--An estate or
28 interest in real property in the name of a nonprofit association
29 may be encumbered or transferred by a person so authorized in a
30 statement of authority recorded in the office of the recorder of
20030S0276B0283 - 130 -
1 deeds for the county in which a transfer of the property would
2 be recorded.
3 (c) Contents of statement.--A statement of authority must
4 set forth:
5 (1) The name of the nonprofit association.
6 (2) The address in this Commonwealth, including the
7 street address, if any, of the nonprofit association; or, if
8 the nonprofit association does not have an address in this
9 Commonwealth, its address out of State.
10 (3) The name or title of a person authorized to encumber
11 or transfer an estate or interest in real property held in
12 the name of the nonprofit association.
13 (4) The action, procedure or vote of the nonprofit
14 association that authorizes the person to encumber or
15 transfer the real property of the nonprofit association and
16 that authorizes the person to execute the statement of
17 authority.
18 (d) Formality.--A statement of authority must be signed in
19 the same manner as a deed by a person who is not the person
20 authorized to encumber or transfer the estate or interest.
21 (e) Recording fee.--The recorder of deeds may collect a fee
22 for recording a statement of authority in the amount authorized
23 for recording a transfer of real property, but the mere
24 recording of a statement of authority shall not constitute a
25 transfer of an interest in the real property for the purpose of
26 the taxation of real property transfers.
27 (f) Amendment.--An amendment, including a cancellation or
28 extension, of a statement of authority must meet the
29 requirements for signing and recording of an original statement.
30 Unless canceled earlier, a recorded statement of authority or
20030S0276B0283 - 131 -
1 its most recent amendment is canceled by operation of law five
2 years after the date of the most recent recording.
3 (g) Effect of filing.--If the record title to real property
4 is in the name of a nonprofit association and a statement of
5 authority is recorded in the office of the recorder of deeds for
6 the county in which a transfer of the real property would be
7 recorded, the authority of the person named in the statement of
8 authority is conclusive in favor of a person who gives value
9 without notice that the person lacks authority.
10 § 9126. Status; liability in tort and contract.
11 (a) General rule.--A nonprofit association is a legal entity
12 separate from its members.
13 (b) Limited contract liability.--A person is not liable for
14 a breach of contract by a nonprofit association merely because
15 the person is a member, is authorized to participate in the
16 management of the affairs of the nonprofit association or is a
17 person considered to be a member by the nonprofit association.
18 (c) Limited tort liability generally.--A person is not
19 liable for a tortious act for which a nonprofit association is
20 liable merely because the person is a member, is authorized to
21 participate in the management of the affairs of the nonprofit
22 association or is a person considered as a member by the
23 nonprofit association.
24 (d) Limitation on imputed tort liability.--A tortious act of
25 a member or other person for which a nonprofit association is
26 liable is not imputed to a person merely because the person is a
27 member of the nonprofit association, is authorized to
28 participate in the management of the affairs of the nonprofit
29 association or is a person considered as a member by the
30 nonprofit association.
20030S0276B0283 - 132 -
1 (e) Claims by or against members.--A member of, or a person
2 considered to be a member by, a nonprofit association may assert
3 a claim against the nonprofit association. A nonprofit
4 association may assert a claim against a member or a person
5 considered to be a member by the nonprofit association.
6 § 9127. Capacity to assert and defend; standing.
7 (a) General rule.--A nonprofit association, in its name, may
8 institute, defend, intervene or participate in a judicial,
9 administrative or other governmental proceeding or in an
10 arbitration, mediation or any other form of alternative dispute
11 resolution.
12 (b) Representational status.--A nonprofit association may
13 assert a claim in its name on behalf of its members if one or
14 more members of the nonprofit association have standing to
15 assert a claim in their own right, the interests the nonprofit
16 association seeks to protect are germane to its purposes and
17 neither the claim asserted nor the relief requested requires the
18 participation of a member.
19 § 9128. Effect of judgment or order.
20 A judgment or order against a nonprofit association is not by
21 itself a judgment or order against a member.
22 § 9129. Disposition of personal property of inactive nonprofit
23 association.
24 If a nonprofit association has been inactive for three years
25 or longer, a person in possession or control of personal
26 property of the nonprofit association may transfer the property:
27 (1) if a document of a nonprofit association specifies a
28 person to whom transfer is to be made under these
29 circumstances, to that person; or
30 (2) if no person is so specified, to a nonprofit
20030S0276B0283 - 133 -
1 association or nonprofit corporation pursuing broadly similar
2 purposes, or to a government or governmental subdivision,
3 agency or instrumentality.
4 § 9130. Appointment of agent to receive service of process.
5 (a) General rule.--A nonprofit association may file in the
6 Department of State a statement appointing an agent authorized
7 to receive service of process.
8 (b) Contents of statement.--A statement appointing an agent
9 must set forth:
10 (1) The name of the nonprofit association.
11 (2) The address in this Commonwealth, including the
12 street address, if any, of the nonprofit association, or, if
13 the nonprofit association does not have an address in this
14 Commonwealth, its address out of State.
15 (3) The name of the person in this Commonwealth
16 authorized to receive service of process and the person's
17 address, including the street address, in this Commonwealth.
18 (c) Execution.--A statement appointing an agent to receive
19 service of process must be signed by a person authorized to
20 manage the affairs of the nonprofit association. The statement
21 must also be signed by the person appointed agent, who thereby
22 accepts the appointment. The appointed agent may resign by
23 filing a resignation in the department and giving notice to the
24 nonprofit association.
25 (d) Amendment.--An amendment, including a cancellation, of a
26 statement appointing an agent to receive service of process must
27 meet the requirements for execution of an original statement.
28 (e) Cross references.--See sections 134 (relating to
29 docketing statement) and 135 (relating to requirements to be met
30 by filed documents).
20030S0276B0283 - 134 -
1 § 9131. Claim not abated by change of members or officers.
2 A claim for relief against a nonprofit association does not
3 abate merely because of a change in its members or persons
4 authorized to manage the affairs of the association.
5 Section 3. Effect of reenactments.
6 (a) General rule.--Notwithstanding 1 Pa.C.S. § 1957
7 (relating to ineffective provisions not revived by reenactment
8 in amendatory statutes), it is hereby declared to be the intent
9 of the act of December 21, 1988 (P.L.1444, No.177), known as the
10 General Association Act of 1988, the act of December 19, 1990
11 (P.L.834, No.198), known as the GAA Amendments Act of 1990, the
12 act of December 18, 1992 (P.L.1333, No.169), known as the GAA
13 Amendments Act of 1992, the act of June 22, 2001 (P.L.418,
14 No.34), known as the GAA Amendments Act of 2001, and this act
15 cumulatively to restore all provisions of 15 Pa.C.S. (relating
16 to corporations and unincorporated associations) added by the
17 act of November 15, 1972 (P.L.1063, No.271), entitled "An act
18 amending the act of November 25, 1970 (P.L.230), entitled 'An
19 act codifying and compiling a part of the law of the
20 Commonwealth,' adding provisions relating to burial grounds,
21 corporations, including corporations not-for-profit, educational
22 institutions, private police, certain charitable or eleemosynary
23 institutions, certain nonprofit insurers, service of process on
24 certain nonresident persons, names, prescribing penalties and
25 making repeals," to their status prior to the partial repeal
26 effected by section 905 of the act of July 29, 1977 (P.L.105,
27 No.38), known as the Fraternal Benefit Society Code, except as
28 otherwise expressly provided by such provisions as reenacted and
29 amended by the General Association Act of 1988, the GAA
30 Amendments Act of 1990, the GAA Amendments Act of 1992, the GAA
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1 Amendments Act of 2001, and this act.
2 (b) Effective date.--The provisions of this section shall be
3 retroactive to the effective date of the act of July 29, 1977
4 (P.L.105, No.38), known as the Fraternal Benefit Society Code.
5 Section 4. Repeals.
6 The following acts and parts of acts are repealed:
7 Act of April 27, 1855 (P.L.365, No.383), entitled "An act
8 extending the right of Trial by Jury to certain cases."
9 Act of April 18, 1949 (P.L.583, No.123), entitled "An act to
10 further amend the act, approved the fifth day of May, one
11 thousand nine hundred thirty-three (Pamphlet Laws 289), entitled
12 'An act relating to nonprofit corporations; defining and
13 providing for the organization, merger, consolidation, and
14 dissolution of such corporations; conferring certain rights,
15 powers, duties, and immunities upon them and their officers and
16 members; prescribing the conditions on which such corporations
17 may exercise their powers; providing for the inclusion of
18 certain existing corporations of the first class within the
19 provisions of this act; prescribing the terms and conditions
20 upon which foreign nonprofit corporations may be admitted or may
21 continue to do business within the Commonwealth; conferring
22 powers and imposing duties on the courts of common pleas,
23 prothonotaries of such courts, recorders of deeds, and certain
24 State departments, commissions, and officers; authorizing
25 certain local public officers and State departments to collect
26 fees for services required to be rendered by this act; imposing
27 penalties; and repealing certain acts and parts of acts relating
28 to corporations,' by making further provisions relating to
29 nonprofit medical service corporations; by extending the
30 provisions of said act relating to the furnishing of medical
20030S0276B0283 - 136 -
1 services by nonprofit medical service corporations so as to
2 include the furnishing of osteopathic services by doctors of
3 osteopathy to subscribers and their dependents, and by providing
4 that the articles of incorporation of existing nonprofit medical
5 service corporations are amended by the provisions of this act
6 so as to authorize the furnishing of such osteopathic services
7 by doctors of osteopathy."
8 Act of May 12, 1949 (P.L.1274, No.379), entitled "An act to
9 further amend the act, approved the fifth day of May, one
10 thousand nine hundred thirty-three (Pamphlet Laws 289), entitled
11 'An act relating to nonprofit corporations; defining and
12 providing for the organization, merger, consolidation, and
13 dissolution of such corporations; conferring certain rights,
14 powers, duties, and immunities upon them and their officers and
15 members; prescribing the conditions on which such corporations
16 may exercise their powers; providing for the inclusion of
17 certain existing corporations of the first class within the
18 provisions of this act; prescribing the terms and conditions
19 upon which foreign nonprofit corporations may be admitted or may
20 continue to do business within the Commonwealth; conferring
21 powers and imposing duties on the courts of common pleas,
22 prothonotaries of such courts, recorders of deeds, and certain
23 State departments, commissions, and officers; authorizing
24 certain local public officers and State departments to collect
25 fees for services required to be rendered by this act; imposing
26 penalties; and repealing certain acts and parts of acts relating
27 to corporations,' by making further provisions relating to
28 nonprofit medical service corporations; by extending the
29 provisions of said act relating to the furnishing of medical
30 services by nonprofit medical service corporations so as to
20030S0276B0283 - 137 -
1 include the furnishing of certain dental services to subscribers
2 and their dependents; and by providing that the articles of
3 incorporation of existing nonprofit medical service corporations
4 are amended by the provisions of this act so as to authorize the
5 furnishing of such dental services by doctors of dental
6 surgery."
7 Act of December 9, 1955 (P.L.818, No.238), entitled "An act
8 amending the act of May five, one thousand nine hundred thirty-
9 three (Pamphlet Laws 289), entitled 'An act relating to
10 nonprofit corporations; defining and providing for the
11 organization, merger, consolidation, and dissolution of such
12 corporations; conferring certain rights, powers, duties, and
13 immunities upon them and their officers and members; prescribing
14 the conditions on which such corporations may exercise their
15 powers; providing for the inclusion of certain existing
16 corporations of the first class within the provisions of this
17 act; prescribing the terms and conditions upon which foreign
18 nonprofit corporations may be admitted or may continue to do
19 business within the Commonwealth; conferring powers and imposing
20 duties on the courts of common pleas, prothonotaries of such
21 courts, recorders of deeds, and certain State departments,
22 commissions, and officers; authorizing certain local public
23 officers and State departments to collect fees for services
24 required to be rendered by this act; imposing penalties; and
25 repealing certain acts and parts of acts relating to
26 corporations,' providing for the incorporation and regulation of
27 nonprofit dental service corporations furnishing dental services
28 only to certain subscribers and their dependents."
29 Act of September 30, 1965 (P.L.570, No.294), entitled "An act
30 amending the act of May 5, 1933 (P.L.289), entitled 'An act
20030S0276B0283 - 138 -
1 relating to nonprofit corporations; defining and providing for
2 the organization, merger, consolidation, and dissolution of such
3 corporations; conferring certain rights, powers, duties, and
4 immunities upon them and their officers and members; prescribing
5 the conditions on which such corporations may exercise their
6 powers; providing for the inclusion of certain existing
7 corporations of the first class within the provisions of this
8 act; prescribing the terms and conditions upon which foreign
9 nonprofit corporations may be admitted or may continue to do
10 business within the Commonwealth; conferring powers and imposing
11 duties on the courts of common pleas, prothonotaries of such
12 courts, recorders of deeds, and certain State departments,
13 commissions, and officers; authorizing certain local public
14 officers and State departments to collect fees for services
15 required to be rendered by this act; imposing penalties; and
16 repealing certain acts and parts of acts relating to
17 corporations,' requiring approval by the State Registration
18 Board for Professional Engineers prior to the use of certain
19 words in corporate names."
20 Act of December 27, 1965 (P.L.1250, No.507), entitled "An act
21 amending the act of May 5, 1933 (P.L.289), entitled 'An act
22 relating to nonprofit corporations; defining and providing for
23 the organization, merger, consolidation, and dissolution of such
24 corporations; conferring certain rights, powers, duties, and
25 immunities upon them and their officers and members; prescribing
26 the conditions on which such corporations may exercise their
27 powers; providing for the inclusion of certain existing
28 corporations of the first class within the provisions of this
29 act; prescribing the terms and conditions upon which foreign
30 nonprofit corporations may be admitted or may continue to do
20030S0276B0283 - 139 -
1 business within the Commonwealth; conferring powers and imposing
2 duties on the courts of common pleas, prothonotaries of such
3 courts, recorders of deeds, and certain State departments,
4 commissions, and officers; authorizing certain local public
5 officers and State departments to collect fees for services
6 required to be rendered by this act; imposing penalties; and
7 repealing certain acts and parts of acts relating to
8 corporations,' making further provisions relating to nonprofit
9 medical, dental and osteopathic service corporations; extending
10 the provisions of said act relating to the furnishing of
11 medical, dental and osteopathic services by nonprofit medical,
12 dental and osteopathic service corporations so as to include the
13 furnishing of optometric services to subscribers and their
14 dependents, and providing that the articles of incorporation of
15 existing nonprofit medical, dental and osteopathic service
16 corporations are amended by the provisions of this act so as to
17 authorize the furnishing of optometric services by doctors of
18 optometry."
19 Section 2 of the act of November 15, 1972 (P.L.1063, No.271),
20 entitled "An act amending the act of November 25, 1970 (No.230),
21 entitled 'An act codifying and compiling a part of the law of
22 the Commonwealth,' adding provisions relating to burial grounds,
23 corporations, including corporations not-for-profit, educational
24 institutions, private police, certain charitable or eleemosynary
25 institutions, certain nonprofit insurers, service of process on
26 certain nonresident persons, names, prescribing penalties and
27 making repeals."
28 Section 5. Effective date.
29 This act shall take effect in 60 days.
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1 SOURCE NOTES
2 The source notes for section 2 or this act adding 15 Pa.C.S.
3 Subch. 91-B are as follows:
4 15 Pa.C.S. § 9121: Subsection (a) patterned after Uniform
5 Unincorporated Nonprofit Association Act §15. Subsection (c)
6 patterned after Uniform Unincorporated Nonprofit Association Act
7 §19. Subsection (d) patterned after Uniform Unincorporated
8 Nonprofit Association Act §18(c).
9 15 Pa.C.S. § 9122: Patterned after Uniform Unincorporated
10 Nonprofit Association Act §1. Definitions in the Uniform Act of
11 "person" and "state" omitted as supplied by the definitions of
12 those terms in 1 Pa.C.S. §1991.
13 15 Pa.C.S. § 9123: Patterned after Uniform Unincorporated
14 Nonprofit Association Act §3.
15 15 Pa.C.S. § 9124: Patterned after Uniform Unincorporated
16 Nonprofit Association Act §4.
17 15 Pa.C.S. § 9125: Patterned after Uniform Unincorporated
18 Nonprofit Association Act §5. The last clause of subsection (e)
19 is a clarification of existing law.
20 15 Pa.C.S. § 9126: Patterned after Uniform Unincorporated
21 Nonprofit Association Act §6. The words "or omission" in the
22 Uniform Act are omitted as supplied by the definition of "act"
23 in 15 Pa.C.S. § 102. As to subsection (e), compare Pa.R.Civ.P.
24 2154.
25 15 Pa.C.S. § 9127: Patterned after Uniform Unincorporated
26 Nonprofit Association Act §7.
27 15 Pa.C.S. § 9128: Patterned after Uniform Unincorporated
28 Nonprofit Association Act §8.
29 15 Pa.C.S. § 9129: Patterned after Uniform Unincorporated
30 Nonprofit Association Act §9.
31 15 Pa.C.S. § 9130: Patterned after Uniform Unincorporated
32 Nonprofit Association Act § 10. The person named in the filing
33 will be subject to service of process under Pa.R.Civ.P. 423(2).
34 Subsection (d) of the Uniform Act omitted as supplied by 15
35 Pa.C.S. § 153(a)(15). Compare Uniform Act §13.
36 15 Pa.C.S. § 9131: Patterned after Uniform Unincorporated
37 Nonprofit Association Act §11.
38 The provisions repealed by section 4 of this act are supplied
39 by this act as follows:
40 Repealed Section Unofficial Superseding
41 Act Citation Provision of
42 Title 15
43 1949, No.123 1,2 - Repealed 1972
44 3 15 P.S. § 7004 note 40 Pa.C.S. § 6322(f)
45 4 - Effective date
46 1949, No.379 1-3 - Repealed 1972
47 4 - Effective date
48 1955, No.238 1,2 - Repealed 1972
49 3 15 P.S. § 7220 note Obsolete
50 4 - Effective date
51 1965, No.294 1,2 - Repealed 1972
52 3 15 P.S. § 7202 note Obsolete
53 4 - Effective date
54 1965, No.507 1-5 - Repealed 1972
55 6 15 P.S. § 7004 note 40 Pa.C.S. § 6322(f)
56 1972, No.271 2 Former 15 Pa.C.S. Obsolete
57 § 101 note
58 15 Pa.C.S. § 5303 Obsolete
59 note
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